SCOTTISH HIGHLANDS AND ISLANDS DEVELOPMENT

HL Deb 27 January 1971 vol 314 cc953-1053

2.45 p.m.

THE EARL OF PERTH rose to draw attention to the work of the Highlands and Islands Development Board; and to move for Papers. The noble Earl said: My Lords, I beg to move the Motion standing in my name. I think that this is the first Scottish debate since the death of Lord Bilsland, and so it is appropriate to pay tribute to the great work that the noble Lord did for Scotland. Certainly since the war the economic changes that have taken place in Scotland have been largely the work of the late Lord Bilsland, carried through on his initiation and with his encouragement. As your Lordships know, he was the founder of the Scottish Development Council and was also largely instrumental in bringing many American industries into the country. The achievements of the Council are undoubtedly his achievements. So we are all going to miss him, with his great charm, modesty and wisdom, and I feel that his death is a great loss.

My Lords, if I may, I will say a few words about how this Motion came to be put down in its present form. Some of your Lordships will know that it was originally in the name of the noble Duke, the Duke of Atholl; but he is speaking from the Government Benches and the Government were not able to give time for this debate—and, from their point of view, I can understand the reasons for this. Neither the Labour Benches nor the Liberal Benches were able to come to our rescue; therefore we were left with the possibility of having the Motion put down from the Cross-Benches. This led to seeking a Peer who was a Cross-Bencher to put down the Motion, and that is why I am leading this afternoon, although there are others who are far more qualified to speak. I should like to say to my fellow Cross-Benchers how grateful we are for their appreciation of the importance of this subject of the Highlands and Islands and their development; and the fact that there are at least 18 speakers to-day shows that this action is greatly appreciated.

The debate is particularly appropriate because the Board have completed nearly five years' work, and also because there is to be a change of direction in the Board's work, or at any rate a change of directors. But first let me refer to the knighthood of Professor Grieve, or more properly Sir Robert Grieve, which I feel gives satisfactory recognition of the hard and valuable work that he and others on the Board have done for the Highlands and Islands.

I do not intend to go into any details of the Report save in two respects: S.E.T., and the Report's recognition of the importance of concentrating much effort on what I should like to call "natural resources" in its wider sense. Let me touch on the latter subject first and say that I entirely agree that it is right to encourage what comes naturally; for example, sea fisheries. If your Lordships will look at the figures in the Report in Appendix VII, you will see that it shows that the landings of fish in the last five years have very nearly doubled. Their value amounts now to the formidable figure of over £7 million. Of that figure no less than £2.3 million is from shell fish, landings of which have in fact gone up nearly three times in value in the last five years. Sea fishing is a sturdy, hard profession demanding initiative, courage and independence; and, as we all know, these are the qualities that the Highlanders have in full measure. I am sure that special attention should be given to encouraging one aspect of the fisheries; namely, the cultivation of shell fish. A great deal can be done here—far more than has been done in the past—and we all know how good is a Scottish lobster!

Again, many of those in the regions have full employment for only part of the year. At other times they use their skills in other ways—for example, in converting wool into tweed; and making jerseys, or even ties. I am wearing one this afternoon, and I hope that will encourage others to do the same. The design and especially the marketing, as the Report emphasises, are essential to the real success of this sort of business and such bodies as the Highland Home Industries and others which undertake this marketing should be given every help.

Lastly, and most important, and perhaps most obvious, there is the tourist trade. We all know the great scenic beauties which are apparent in Scotland in the summer and the opportunities that exist for every kind of outdoor pursuit—hiking, or whatever sport it may be. Then in the winter we have the winter sports, so that in two seasons—one could really say in all seasons—the tourist trade could be developed in Scotland. Yesterday a very important aspect of the tourist trade was debated in your Lordships' House when the question of caravans was discussed. There is no need to go further into that matter, except to express the hope, or perhaps voice the certainty, that the Government will study with the greatest attention what was said during that debate and will consider what action is necessary. The other points about tourism I am only too pleased to leave to others to discuss.

Now, my Lords, I come to the nonsense—I use the word advisedly—of S.E.T. in the Highlands. Some of your Lordships may recall that whenever I have had the chance I have raised this matter, and have done my best to draw attention to the fact that this is the stupidest tax ever devised for the Highlands and Islands and their development. A large percentage of the wage-earners in the area still come into the service category, and taxing them, with the idea that as a result they will go into some form of productive industry, is, to those who know the facts, really ridiculous. The only benefit I can see which might come from the tax is that it might produce, for example, a few more prosperous workers in the Midlands. If ever there was a case of taxing the poor for the benefit of the rich, this is it.

For this reason, I was particularly encouraged to read paragraphs 35, 36 and 37 of the Report. The Board dared, somewhat timorously, to analyse the effects of S.E.T. and, to use modern jargon, "Surprise, surprise!" they found that it: … conflicts sharply with policies of regional development in the Highlands. … The Board dared further; they sent a copy of their analysis to the Secretary of State for Scotland, suggesting that some alleviation of the burden on the Highlands was desirable in principle. The Minister's reply was very full and considered—at least I hope so—but it was, "No."

I have given the noble Baroness, Lady Tweedsmuir of Belhelvie, the Minister of State at the Scottish Office, notice that I proposed to raise this issue to-day, but I can hardly expect that in the short time which has elapsed she will give a firm answer. I would however ask her to be certain that the Secretary of State for Scotland reads the analysis of the Board on this question. Indeed, my Lords, could not the analysis be made public for us all to read, so that we may judge of the effects of the tax on the Highlands? However, I am encouraged to hope that in due time we may have from the Secretary of State for Scotland an answer which is the right one. We know that the Government dislike S.E.T. and are committed to its eventual abolition. Where could they start better than in the Highlands and Islands? I am sure that there would be strong objection from officialdom. The officials would say, "This would set a very strong precedent of regional exemption from a national tax, and it will never do." But, my Lords, let common sense and fair play override principle.

I would end by wishing good luck and success to the new Chairman (I understand that he is here to-day, and therefore will be taking note of what many of your Lordships say) and to members of the Board in their very human and very difficult task. For this task I can imagine no better start, and proof that the Government really care about the Highlands and Islands, than that they should abolish S.E.T. for the region; and do it quickly. My Lords, I beg to move for Papers.

2.56 p.m.

LORD HUGHES

My Lords, may I start by expressing thanks to the noble Earl, Lord Perth, for once again giving us the opportunity to debate life in the Highlands through the medium of consideration of the Report of the Highlands and Islands Development Board. I would also say that it is a matter of regret to me, as it was to him, that the first matter to which he had occasion to refer was the recent death of the noble Lord, Lord Bilsland. I am sure that all in Scotland and in your Lordships' House, and many others as well, would wish to associate themselves with the tribute which the noble Earl paid to Lord Bilsland who was a pioneer in so many things in Scotland. We used to enjoy his contributions to debates in this House and he will be seriously missed in Scotland, even although it is now some years since he was actively engaged in the work which occupied so much of his time over so long a period.

I do not intend to follow the noble Earl, Lord Perth, very far in what proved to be the main subject of his remarks, because, although the Highlands and Islands Board did, as he said, concern themselves with the operation of the selective employment tax, a full discussion of that is not, I think, properly to be undertaken in a consideration of the work of the Highlands and Islands Development Board. It may have been their aspiration, but it certainly was not their work. I would, however, give the noble Earl a modicum of support. The emphasis in his latter remarks about the selective employment tax was upon its eventual abolition, and it seems to me that since the General Election greater stress is being placed by the Government on "eventual" than on "abolition".

The support which I would offer the noble Earl is that I think he is wrong in expressing doubt about regional exceptions to a national tax. In fact, it is in the field of the selective employment tax itself that there have been either regional or district exemptions, because the exemptions accorded to hotels were allocated to specific areas; and if in their detailed examination of their Election pledges in relation to the selective employment tax the Government find that "eventual" becomes even more important than "abolition", I would strongly support the allocation of such abolition as is possible to selected areas—and obviously the Highlands of Scotland would have a very high priority.

My Lords, to come specifically to the problems of the Highlands, from the middle of the last century at least the Highland story was one of continuing decline. It was not just a decline in some particular subject, but it was over the whole field of Highland activity: in the number of people who lived there; in the occupations which they followed, whether in agriculture, in commerce or in industry. This was not because of lack of effort by successive Governments to deal with it. Particularly from the beginning of this century, legislation was passed and money was poured into efforts to deal with the Highlands problem. But most of this was either totally unsuccessful or met with such limited success that it could be regarded as practically a total failure; and some of the efforts were such failures that they do not even spring to mind in the 'seventies.

I suppose that, of pre-war activities, those which could be regarded as having had some measure of success were the Crofters Commission and the North of Scotland Hydro-Electric Board. The latter, particularly, had substantial success in attracting industry into the Highlands. But, of course, they were restricted in what they could do. First of all, the attraction of industry was but a secondary object of the Hydro-Electric Board. I think their particular credit is that in a secondary effort they did so much, having regard to the fact that their expenditure in that direction sometimes resulted in their spending more money than was perhaps absolutely necessary for the production of electricity. But I never heard any criticism of the Hydro-Electric Board's expenditure in these directions, and successive chairmen—Tom Johnston, and the noble Lord, Lord Strathclyde, in particular—regarded the promotion of Highland industry as being a most important part of their work.

It is not surprising, therefore, having regard to that background, that people in the Highlands did not immediately acclaim the creation of the Highlands and Islands Development Board as meaning the end of their troubles. Perhaps they were justifiably sceptical about it; or perhaps, in the Asquithian phrase, they preferred to "wait and see". In the language of recent times, the Highlands could be described (and they still remained after the war) as a "lame duck". Some people in the first year of the Board's existence were hostile to the whole idea of the Board; and some of them, at least, gave the impression that they would not have been too sorry if it had turned out to be another Highland failure. Fortunately, this was not so. This does not mean that the Board have not had their critics. What human institution in the Highlands could be free from criticism? In fact, I am quite satisfied that even the Almighty himself has to accept that he is not immune from Highland criticism: so the Board could not expect to do better in that direction.

Yet the story of the Highlands and Islands Development Board is really one of comparatively overwhelming success. That seems to be a contradiction in terms, but I hope that it conveys my meaning. To say "overwhelming" is perhaps to put it a little too strongly, and yet just to put it as "success" is not giving sufficient credit to the Board for the work that they have done in something less than five years.

Perhaps I may look at some of the effects of their work. First of all, there is the matter of population. Nothing has more impressed the people of Scotland about the way in which their economy suffered in comparison with the rest of the country than the steady reduction in population through migration. The Highlands and Islands were particularly subject to this. Yet in the last year, on which the Board report, the number of people in the Highlands and Islands fell by a mere 65. This is indeed in Highland terms real progress; and I hope that in the years that lie ahead we shall be able to go into positive rather than negative figures, and that a mere 65 reduction may in due course be replaced by an increase in population. The figures of population alteration, of course, were not uniform: some areas still showed further falls, and others, particularly urban areas, showed an increase in population. What I found in the Board's Report of particular encouragement, however, was that these figures were arrived at in spite of the fact that the birth rate in the Highlands and Islands was lower than previously and the death rate was unchanged. The importance in the position, therefore, arises from the reduction in the number of people leaving the area: in fact, in the year 1969 it was estimated that this had fallen to only about 800.

I do not intend to say much about agriculture and forestry, because with a long list of speakers I am certain that these subjects will be adequately dealt with by people who are much better qualified to talk of them than I am. I had two years helping to run the Agriculture and Fisheries Department in the Scottish Office, but I do not claim that that has made me qualified to speak with any degree of expertise on the subject. I would rather leave it at that than to go on to it and perhaps prove that my suspicions are well founded.

I should like to say something about fishing, as the noble Earl, Lord Perth, did, because this is a field in which the Board have had a considerable degree of success. They noted that the year had been a good one for fishing generally; but they had made it part of their business to try to ensure that Highland fishermen should participate to a greater degree than they had done in years not very far back, when most of the fishing was from other parts of Scotland, even although the fish were caught in waters adjoining the Highlands.

The financial assistance which the Board gave in the year was to enable another 40 boats to be acquired, both new and second-hand, bringing the total added with Board assistance over the years to 126, 92 of which were fishing boats. There was also investment by the Board, as well as by private enterprise, in various fish processing on shore. That, I think, is most essential, because fishing cannot succeed by the activity of the boats alone: it must be backed by reasonable enterprise on shore, and it is good that the Board have appreciated the importance of this. I will not go into details, because I assume that most noble Lords taking part in the debate will have read the Report of the Board, and it is well detailed. Sufficient to say that this year's investment of £250,000 brings their total investment in fishing to more than £2 million, and as a result of it 1,000 jobs for fishermen have either been saved or, in most part, created as a result of these efforts.

I am sure that the references which the noble Earl made to tourism will figure fairly prominently in our debate. I do not want to go into it in great detail, although it is the case that the Board have made a particular effort to help stimulate tourism in the Highlands. Presumably later in the year we shall have the opportunity of discussing the first year's activity of the Tourist Board, and it seems to me that we might well have a worthwhile debate on tourism in Scotland when we can consider both the activities of the Highlands and Islands Board and the Scottish Tourist Board, and the way in which these two organisations are managing to work in harness in the furtherance of this very useful effort.

It is in industry and commerce that the greatest task faced the Highland Board because these were the directions in which the Highlands were most deficient. The industry which came to the Highlands came hitherto as a result of the work of the Hydro-Electric Board, with the notable exceptions of the pulp mill at Fort William, and the nuclear enterprise at Dounreay. Therefore, there was a great deal to be done. It is in the Board's activities in industrial promotion to which I wish to especially direct your Lordships' attention.

What do the figures up to the end of 1969 show? Having regard to the population distribution in the Highlands, it is not surprising that the Board regarded it as proper that they should direct their attention particularly to the attraction of small industries and small manufacturing processes. Up to the end of 1969, the Board had helped to bring into the area, or to start in the area, 259 establishments with jobs, fortunately mostly for men, totalling some 1,600: £1.8 million came from the Board, and £1.2 million came from the firms themselves. A total investment in these manufacturing enterprises of £3 million was no insignificant figure. There has been a continuous increase in manufacturing jobs shown in 1969. Your Lordships will agree that it is good to see that they have broken into the science-based industries, although in a very small way. It is an especial pleasure to me, as a former Chairman of Glenrothes Development Board—and Glenrothes in recent years was described as the "electronic capital of Scotland"—to see that the Board are making a very special effort to bring electronics industries into the Highland area, having regard to the weight and value ratio of these products.

If I may stray out of the Highlands for a moment, I remember that after the official opening of an electronics plant in Glenrothes, the chairman of the American company had a meeting with the technical Press, who had been invited in very large numbers. One reporter asked the chairman, having regard to the fact that there was practically no market for their products in Scotland, why he had elected to set up the plant in Fife. The answer was that the weight of their production was so small that given a satisfactory postal service (not perhaps a happy matter to refer to at the present time) they could, without inconvenience, have located the factory on the moon, because the first week's production could be sent off by parcel post.

So the Board are well advised to consider the importance of such an industry which does not necessarily have to start in a large way. One of the largest American concerns in this field, now employing more than 30,000 people, started less than a quarter of a century ago in the garage of its founder, with himself as the sole worker. There have been failures, of course, and it is right that the Board, in their Report, should remind us that they have a task to try to encourage into the Highlands industries which would perhaps not merit the support of ordinary financial resources. If that is the case, then obviously they are taking greater risks than would be normal. If there are to be greater risks than normal, then the possibility of some degree of failure must be greater than normal. What is most satisfactory is that, expressed as a percentage, the failure is less than 3 per cent. If the Board were ever to change their policy and seek to guarantee themselves against failure, a great deal of the 97 per cent. of success would disappear at the same time as the 3 per cent. of failure. Therefore, in this field especially, the Board are to be congratulated in their efforts over their wide range of duties and powers.

In the beginning the Board received a fair number of sneers from those who did not believe that it was possible for them to succeed. It is correct to say that some of those who, three years or so ago, were sneering are now silent or, even better, in some cases have changed from sneers to cheers. On this side of the House in particular we will give the Board every encouragement in ever-expanding efforts, and I hope—and I believe I shall not hope in vain—that the Government will do the same.

Government policy in general is a switching away from grants and loans. People are being expected to do without Government help in many ways. I think the phrase is that they are "expected to stand on their own feet". The inference is that if the lame ducks fall down they will be allowed to lie down. In Scotland generally this has in some measure—will not put it any stronger than that—contributed to the appalling unemployment figures of this month. It is essential, therefore, that the Government give a firm assurance, and I hope that the noble Baroness, Lady Tweedsmuir of Belhelvie, either in her first speech or in her second speech—because I have no doubt she will receive leave to speak for a second time—will give a firm assurance that these policies of withdrawal of public support through grants and loans will not be applied to the activities of the Highlands and Islands Development Board. If the Government do not continue the present policies, neither the Highlands in particular nor Scotland in general will readily forgive them.

3.18 p.m.

THE MINISTER OF STATE, SCOTTISH OFFICE (BARONESS TWEEDSMUIR OF BELHELVIE)

My Lords, we are indeed indebted to the noble Earl, Lord Perth, for having given us the opportunity twice in the past six months to have major debates upon Scotland. In July it was an industrial debate on Oceanspan, and now to-day the debate is on the largely rural areas of the Scottish Highlands and Islands. I should like to join with the noble Earl at once, and also with the noble Lord, Lord Hughes, in paying tribute to the noble Lord, Lord Bilsland, who was one of the great Scottish figures and whom I knew fairly well. At one time we were both asked to stand as Rector of Glasgow University. I regret to say that we were both defeated with about the same number of votes.

I am fortunate to have met members both of the old Board in early September, and of the new Board in late November. As the Highlands and Islands cover 47 per cent. of the land surface of Scotland and contain only 5 per cent. of her population—in other words, just under 280,000 people—any development board have a very difficult task. This is the first time that a Conservative Minister has spoken on the Highlands and Islands Development Board and the Act of 1965, and I will try, as the noble Lord, Lord Hughes, has done, to give a fair picture, both good and bad, of the difficulties and the opportunities of the Board over the past five years, and the kind of problems that the new Board have to face.

But first of all, before we come to the detailed question of the Board, I should like to take up the particular question—a very important one indeed—of which the noble Earl, Lord Perth, was good enough to give me notice and which he asked this afternoon. That was when and if the selective employment tax is going to be abolished. He asked whether I would draw the attention of the Secretary of State to the words on this matter in the Fourth Annual Report of the H.I.D.B. I can go further than that and repeat the firm assurance that has been given by the Government as a whole that S.E.T. will be abolished. The time and manner is, of course, for my right honourable friend the Chancellor of the Exchequer and not for me.

I think the noble Lord, Lord Hughes, will agree that some of the doubts which were expressed by some people about this Board were in some respects warnings which led to a conclusion which nobody could deny: that the old Board had a shaky start. Maybe it was because in the early days, in their anxiety to achieve Highland development, they started, or helped others to start, sometimes against their own better judgment, on some ventures without always thinking through the implications and without always thoroughly assessing the financial requirements or the possibility of delays or other difficulties. Nevertheless, a great deal has been done since those early days to tackle these problems.

One can now say that in the first five years of their existence the old Board achieved a general acceptance in the Highlands, weathering, in the process, some nasty storms; and much credit should be given to the personality of the first Chairman, Sir Robert Grieve. It is true to say that the Board have given what is almost a novel feeling of confidence in the future of the Highlands and have made people everywhere realise that the Highlands and Islands are suitable for new industry; and, indeed, many new jobs have been created. Therefore I am sure that all noble Lords in this House, from wherever they come, would wish the new Chairman, Sir Andrew Gilchrist, and the new Board members, together with those who were there before, every possible success in their next term of office, just begun.

I suggest that their first task will be to consolidate the gains which have been made in the first five years, and the Government are quite sure that they are determined to do this. Before long a White Paper on the reorganisation of local government in Scotland will be published. The H.I.D.B.—if I may use this short term instead of the whole "Highlands and Islands Development Board"—have been given an assurance about their future in relation to any new Highlands Regional Authority. It certainly would not be wise to ask the Board to demit office as soon as the Highlands Regional Authority is established, because, in any case, with the Parliamentary timetable of consultation, legislation and running the new and old local authority systems in harness for a year, reorganisation could not be complete until 1975. So we expect that the Board will still be in charge of Highland development throughout the 'seventies.

As the House knows, the H.I.D.B. are financed by grant-in-aid from the Scottish Development Department and they keep receipts from loan repayments. The Board assist by grants, loans or equity holdings, industrial and commercial projects over a very wide range of productive and service industries, including tourism in their area. The noble Lord, Lord Hughes, quoted some figures. I should like to quote them slightly differently. They are about the achievements. In the first five years up to October, 1970, the Board have approved grant and loan assistance of £7.6 million, which was matched by a similar amount from private sources. Assistance has been given to 1,424 projects, expected to provide 5,200 jobs. The percentages of assistance to jobs are as follows: manufacturing, 32 per cent., which provided 45 per cent. new jobs; fisheries and agriculture, 26 per cent., which provided 16 per cent. new jobs; tourism and transport, 29 per cent., which provided 25 per cent. new jobs, and various purposes 13 per cent., which provided 14 per cent. new jobs.

Assistance by the Board is comparable to that available in development areas through the Department of Trade and Industry under the Local Employment Acts, but the Board can give, in addition, a special supplementary grant in special circumstances, subject to a maximum of £10,000 or 20 per cent. of the total cost of the project, whichever is the greater. The Board can also give in exceptional cases assistance involving a contribution of as much as 70 per cent. from the public sector, compared with the usual 50 per cent., provided that the average over all the cases handled by the Board in the year does not exceed 50 per cent. Therefore in that way the Board have a slight edge over other development areas.

There are special arrangements for fisheries and also for agriculture which are set out in Appendix XII of the Board's Fourth Report. On agriculture, the object has been to try to avoid duplication but to leave the Board free to lend money for agricultural development or to deal with agricultural cases under their own arrangements where extra employment can be created.

The new industrial incentives which were announced in October by the Government and which are known to the House in no way affect the status and power of the H.I.D.B.; nor do they affect the provision of money for purposes for which the Board were established. In addition, it has now been decided that the Board can go ahead with a programme for building advance factories on sites chosen in consultation with local planning authorities and on land which must have been zoned for industrial use. It is felt that this should be really useful in trying to encourage developments, both large and small.

The noble Lord, Lord Hughes, referred to the bad debts figure published in the Report as 3 per cent. Unfortunately, it is more than that. The Board have explained that this figure was unrealistically low because it took no account of probable or possible losses. The current figure, therefore, taking account of these as well as known losses, is just under 10 per cent. This relatively high figure is largely explained by the difficulties to date in finding really good management and financial experience for projects which in themselves have considerable potential. The Board feel that at about 10 per cent. the loss figure is at its peak and they are sure that it will come down and perhaps stabilise at about 7 per cent. I would certainly agree with the noble Lord, Lord Hughes, that some risks must be taken in the Highlands. In many ways this particular Board take the place of some of the banks which used to back individuals and individual projects many years ago. If we are to try to reverse the lack of jobs in the Highlands we must realise that risks have to be taken. But I understand that the Board are determined that they will be reasonable risks, and they will follow a tough policy with ventures which show no signs of becoming viable.

It is true to say that during the last five years the H.I.D.B. have put into perspective the real possibilities for Highland development. Both the old Board and the new believe that, while agriculture should be developed, it can make little contribution to increased employment. Forestry can help only in the long term when timber is mature and timber-processing industries can be established. Fishing is very important, and I would agree that there has been considerable success in some of, the Board's ventures and assistance in the fishing industry.

Tourism has been a marked success, but the real requirement is the introduction of manufacturing industry and small industries based on local skills and experience. It is quite true that wherever one goes the question is asked, "Could we not have an electronics industry here?". But I would agree with the noble Earl, Lord Perth, who said he hoped that much of the work of the Highlands Board would be devoted to trying to encourage industries which are based on natural resources; and I agree with him about the Highland lobster, of which I partook in the Western Isles.

Although the siting of the aluminium smelter at Invergordon was a Government decision, and finance for it came direct from Central Government, the Board helped considerably to bring this about. The first ingot of aluminium is expected to be poured in the spring of this year, and production should eventually rise to about 100,000 tons per year and provide employment for about 600 people. But as the House knows, such large-scale enterprises are capital intensive and do not in themselves bring much further employment to the area. Nevertheless, the roads and other facilities which these require may in the long run make them attractive to smaller ventures.

It is, however, in the small scattered communities and in the Isles, with an exceptionally high unemployment rate, that the Board have always felt most need to encourage industry based on local skills. Of course the major problem is that of sea transport and charges to the Islands. As the House knows, the H.I.D.B. suggested a new basis for charging in 1968. The Government have asked the Board to produce a case showing the effect of the cost of transport on existing and prospective industries and to find out whether it was transport or some other considerations that are the prime factor. The Board have commissioned a team from Aberdeen University, headed by Professor Gaskin, to provide this factual evidence, and the results should be ready in April.

In the meantime, proposals by the Scottish Transport Group are being thoroughly studied. We are well aware of the dissatisfaction felt in many quarters about the services to the Scottish Islands, both in quality and in cost. The last major attempt to modernise services was in 1964, when a Conservative Government provided three new vehicle ferries for the Western Isles. All the three main operators concerned have now come to the conclusion that a switch from conventional services to roll-on, roll-oft services is essential. We expect to receive proposals from the Scottish Transport Group very soon, in the context of their annual investment review.

My Lords, I feel that I must return to the question of unemployment, particularly in Lewis, which has the highest rate in Scotland—23 per cent., or 1,924 people out of a total insured population of 5,466. There are special problems, and I am glad to note that the noble Lord, Lord Hughes, was temperate in his comment on unemployment, because indeed it could not have happened overnight. It may be that the last Government had something to do with it.

LORD HUGHES

My Lords, will the noble Baroness permit me to interrupt? She has at least advanced on her right honourable friend, who is still in the process of believing that everything bad is entirely the responsibility of the late Government.

BARONESS TWEEDSMUIR OF BELHELVIE

My Lords, as the noble Lord, Lord Hughes, is always congratulating me on bringing measures before your Lordships' House which have been started or devised by former Governments I think he should also take responsibility for those things which were not so good.

To return to Lewis, the Harris tweed industry is of course in the grip of a recession, and it is therefore very important to reinforce small developments. Ross and Cromarty County Council have appointed an officer solely responsible for the promotion of industrial and economic development on Lewis, and Sir Andrew Gilchrist will visit Lewis with his senior officers next Monday. I was fortunate enough to pay an official visit to the Western Isles in September. I have always found that there is no substitute at all for meeting people in their own areas. I learned a great deal, and I was lucky to go because it is about the only part of Scotland, apart from the Far North West, which I had not had a chance to visit.

Lastly, my Lords, I should like to say something about publicity. The Board's estimates for the year include £350,000 for reasearch surveys and publicity. Expenditure by the Board on their major industrial promotion campaign is now running at about £98,000. This included a film called The Top Country, which noble Lords may have seen at the H.I.D.B. exhibition in London this autumn. I personally thought the film excellent, except for the start, which showed an aeroplane arriving at Inverness on a wet tarmac under a lowering sky. I think that if I had been the producer I would have chosen one of those many days we have when the sun is shining the whole time.

LORD HUGHES

During the six summer months, my Lords!

LORD SHEPHERD

Yes, my Lords, we remember them well.

BARONESS TWEEDSMUIR OF BELHELVIE

My Lords, I understand that the Board now intend to be much more specific in the promotion. They will try to reach particular groups of people who are likely developers, and they will specialise in certain regions—for instance, in the Midlands and the East Midlands. They have pruned their estimates for publicity during the next year, believing that publicity which is too widely spread may not achieve the same effect as that achieved if specific areas and problems are tackled. In so far as a campaign of this nature can be assessed to date, the Board are pleased because the first phase produced 839 business inquiries. The Board had included in their target for the current campaign West Germany and the United States of America, but were persuaded to abstain from this while the Government considered the best methods for the promotion of Scotland as a whole—for example, the Scottish Council's proposal to strengthen its publicity and promotion effort and to create the Scotland West Agency. My Lords, I hope that I have not spoken too long. I have tried to give the House a fair picture of what the old Board have tried to do and what are the opportunities—great indeed—lying ahead of the new Board. I look forward to this debate very much because I believe it to be an important one, and I shall listen with the greatest care to the advice which your Lordships may offer.

3.38 p.m.

LORD RANKEILLOUR

My Lords, I venture to address your Lordships for the first time in this, my maiden speech. As is well known, we in the Highlands have several main factors of concern which must be aired on this occasion in order that they are fully understood and can be constructively rectified. Probably the principal one is depopulation. This problem has no immediate democratic solution. We must just try to stem the exodus by the introduction of more forms of employment, more projects, more things to do. If we do not succeed in a relatively short time, then public and syndicate tree planters may well turn the Highlands back into one vast forest. It will be no use crying, for it will have been entirely our own fault. The crofting counties have such a wonderful latent potential for sport, entertainment and sight-seeing that it would be a cardinal error, at this moment in time, to allow these great assets to slip through our hands by our inactivity.

We are called a development area, but with a few major exceptions we are nothing of the kind. Far too many restrictions, often on a personal level, block progress. This has to go; we need men of vision. Whatever we do we must do on a useful scale, for we have the space for it, the will and the inclination. We vitally need good, small hotels in the Highlands, run by imaginative people willing to please their visitors, rather than looking upon them as a tiresome burden. These places would tend to attract school-leavers who might otherwise be out of a job or abandoning the nation altogether. There is absolutely no use whatsoever in advertising the Highlands and then producing insufficient and below par accommodation. Visitors to the hills tend to expect something new and exciting and are often bitterly disappointed by their reception. Many Highland hoteliers have realised this and done something about it, but much more needs to be worked out, and into this framework must be woven the futures of hundreds of Highland people, especially the young and the retired.

Now we come to forestry. This word always engenders very mixed feelings in our countryside among the crofters, farmers and landowners. We feel that too much tree planting, often wastefully situated and carried out, is throttling our agricultural efforts, and fencing off, in the process, great areas of land which never again can be used as useful grazing. We visualise, to our distaste, a new Caledonian Forest which in the act of growing will squeeze out farming and free enterprise and fence itself in, to the detriment of tourist and inhabitant alike. Far too much good land is going under trees in our territory, while the poorer survives untouched, and that, to the countryman, is heresy. If there must be trees in the Highlands, let them be situated in useful positions, to the benefit of the inhabitants, and in anything but block plantations, which are an offence to the eye. Among many other responsibilities, the Forestry Commission must plan their plantations with imagination and foresight, so that in years to come the sons do not condemn their fathers for malpractice.

At this point I must say something about the crofters. There seems to have been, for some years now, and growing steadily, the insidious talk that these fairly independent men are on the way out; and good riddance! I am thankful to say that I do not think that this is the case, and hope that it will never come to pass. The Highland crofter parts most unwillingly with his land and his crofthouse, as these are the fundamentals of his work and life, which is not unnatural. We would all do the same, if we were in a similar position. When our livelihood, or at least part of it, lies at our front door, indeed what more foolish act could we do than turn our back on it and drift to the polluted towns with their unfamiliar patterns of existence? True, it has been done since the Industrial Revolution, but there were always the others left behind, and not all of them were the ancients. The same pertains to-day. It is a way of life, the kernel of a special system indigenous to the Highlands, if to nowhere else, and important to our economy.

It is time now for a word on the destruction of the countryside. Since the war the ever-increasing need for widened roads, new houses and factories, improvement of services, and so many other moves that one's mind reels, seems to have galvanised this Kingdom into the wildest spree of jerry-building madness the land has ever known since wattle was in fashion. Somewhere down this road, in the Highlands, a halt must be called before it is far too late, in order to preserve historic buildings, old graveyards, bridges, even roads, lest they become only a memory. The major reason for this is that our nation depends very considerably upon its beauty, history and roots. If mad progress is allowed to continue unchecked, the world will not want to tour our heritage, as by then we will have none.

My Lords, no region likes to come under the eagle eye of a Development Board, but now that they have arrived let them be of use. It is quite true, naturally, that the Highlands vitally need money to build up their economy, hindered as it is by its scattered communities, but at the same time the bulk of red tape must go to the wall. Of course, inevitably there has to be some paper work to go with the lending of capital, but great efforts must be made by the Board to avoid holding up projects of individual people, who easily become discouraged by endless impersonal forms delving into their souls. Remember, my Lords, we are not talking of overcrowded Southern England or Wales (where, incidentally, the threat of a Board has been removed), but of a complete nation, within the United Kingdom, with a very small and scattered population. So our projects in the Highlands need to get off the ground fast and smoothly, unhindered by officialdom so far as is possible, for nothing kills incentive and enthusiasm quicker than the forced inactivity of fertile minds.

The Highlands can no longer be ignored, for by their size alone we can offer unrivalled opportunities in the field of sport and recreation. But I would say this. It would be unwise for the Highland Board to think that they are going to rule us henceforth. Guide us, yes; aid us, yes; indirectly benefit from us, yes. But rule us, never. However, I should like to see the Board encourage and exhort the Highland people to set up small, often very small, industries with the help of modern electric tools, which are so prevalent these days, in order to augment their crofting or farming income by fabricating small components and making objects for big industry. To this end it would be useful if the Board ran special weekly programmes on television, showing projects which could be undertaken by the modern cottage industrialists; that is, mini-industries in operation; and a comprehensive visual survey of indigenous resources which could be utilised. These should include the long-neglected peat industry, as well as the by-products of the pulp mill and British Aluminium Company at Fort William and elsewhere.

You may gather, my Lords, that I am concentrating my speech upon the welfare of the people of the countryside rather than upon the towns, as I feel that the latter, with their intensive population, should be able to cope with their own problems. It is well for the Board to remember that when they speak so glibly of maintaining the open spaces, keeping the rivers and other waterways free of pollution, opening up the Highlands for the benefit of the increasing tourists, they should keep in mind that most of the territory is private property in one form or another. The Board will, therefore, have to induce the owners to comply in throwing open their lands to inspectors, plodders and hordes.

My Lords, the Highlands are a vast area of ranches, estates, farms, crofts and houses belonging to people who like its peace and solitude. If the Board or any other organisation are allowed to destroy this pattern we shall find ourselves destroying the last frontier. Therefore we who love the hills, and live there, intend to keep a weather eye on the Highlands and Islands Development Board, lest they campaign for ever-increasing powers which might go against the interests of the Highland people. So far, it has been a moderately free nation during this century. Let us keep it that way, for history shows that outside influences have always caused upheaval and disorder. That is not to say that we do not want to progress; but progression must be made in decorous fashion, for the Highland nation will not benefit by the wild expenditure of Board money for such things as white elephant, grant-assisted mammoth hotels. No, there must be much more spreading of the load. For instance, individual crofters should be offered the opportunity to expand their facilities and accommodation for tourists—often a matter of only a few hundred pounds, but a sum that appears to be disliked by the Board. We do not require a nurse, or a saviour, or a dictator, but if this beast is to remain with us then it must be yoked to the plough of our intentions, rather than the other way around.

When I speak of the Highlands, I speak of people, Highland people, people who matter to me. If they can be helped to help themselves, from the youngster to the retired shepherd, then I think that their future will encompass more benefits than ever hitherto and perhaps give them a fuller and more interesting life: for many of the joys which you in the South accept as part of your way of existence are virtually unknown, in fact and substance, North of the Highland line in the hinterland. Perhaps they would not be missed in any case, but that is not our decision. The Highlanders must make up their own minds, but they must have the same opportunities as elsewhere in the United Kingdom, whatever the difference in population, distance and land size. So the Board will have to mould the Highland people, history, farming, forestry, advanced cottage industry, tourism, planning, transport, big business and the Gaelic language, into a useful and constructive campaign, which cannot afford to fail. My Lords and my noble kinsmen, I thank you for listening to me so patiently. The emotive subject of the countryside is well known to all of you, but let us keep a steady eye on future Highland progress and dampen the ardour of the second-bester.

3.50 p.m.

VISCOUNT THURSO

My Lords, I feel a very new boy to be given the privilege of welcoming a maiden speech such as we have heard from the noble Lord, Lord Rankeillour. He has shown to us his keen interest in, and his deep feeling for, the Highlands. I was particularly touched by his plea for the crofters and for the people of the Highlands. I hope that we shall hear frequently from him on Highland subjects now that he has taken the plunge.

I am indeed grateful to the noble Earl, Lord Perth, for having introduced this debate upon the Highlands Board. I am only sorry to hear that we on these Benches were slow in coming to the rescue. I hasten to assure your Lordships that if at any time we can help in any way to bring to the notice of your Lordships' House matters pertaining to the Highlands we shall certainly endeavour to do so.

Yesterday when I spoke in your Lordships' House I promised to be brief, and I think I was. To-day, I do not necessarily make such a promise, but I will try to be to the point. This is by far the most important debate to which a Highland member of your Lordships' House can contribute in any year. This year, as we lave already heard, is of special significance, looking forward as it does to the work which lies ahead of a new Board, under a new Chairman, reporting to a new Government. I hope that we do the subject justice. If we are to do so, it would be wise to start by reminding ourselves of what we expected the Board to be when we set it up; in what conditions the Board was expected to work; what its objectives were to be, and how we expected the Board to set about achieving these objectives.

However, before examining the immediate past I should like to go back further, to examine some of the history and root causes of the situation with which the Highlands Board was set up to deal. I hasten to assure your Lordships that I am not going to indulge in the sort of emotive verbiage which fluttered, like confetti, around the Palace of Westminster at the time of the debates in 1965, when the Highlands Development Board was originally set up. But I believe that we need to get the record straight so that we can see what it is normally supposed to be dealing with. Let us, therefore, leave out of our discussion the repressive measures after the '45, the Clearance, and the emigrant ships sailing to the New World, and let us look simply at a large but remote part of Britain, hard in soil and climate, but tolerably well developed by its own inhabitants at the end of the 18th and the beginning of the 19th centuries.

Large farms had been created on the better land, and new and improved stock and crops brought in to stock them. The representatives at Westminster had managed to screw some money out of the Government. That it had originally been Highland money matters little, but I note it in passing. This money was used to build the first ever roads and harbours leading to the far North and along the East Coast. Dutchmen were brought in to teach the people to cure herring, and ancillary industries like ropeworks, coopering, shipbuilding, net making and so forth, grew up around the booming herring ports of the East Coast. Other light industries were set up: lint mills, meal mills, wool mills, distilleries and flagstone quarries throve. The railway came in, and with it the beginning of a tourist trade, even though it did consist of English and Lowland Scots sportsmen who showed us, somewhat to our surprise, that people were prepared to pay for shooting and fishing in our more desolate parts. Every village had its village trades offering employment alternative to agriculture and fishing. There were the weaver, the tailor, the bootmaker, the blacksmith, the baker and even the dominie and the minister.

So what happened? Just the same thing happened as happened in Lancashire and Tyneside, or in Clydeside and Dundee: people simply sat back and thought it was all going on for ever. When the economic tide began to set against them, at first they did not believe it. Then they did not know what to do; and finally they were sucked down by the undertow of lost assets and dwindling capital. Not wicked, not lazy or feckless people, but just human. My Lords, I make no apology for spending so much time on this interpretation of the past, because I believe that your Lordships will probably never have heard the Highlands problem put in quite this way before. I believe that this is a more realistic approach than the emotional one, and a much more helpful approach if we are to get together to solve the Highlands problem.

Let us look, therefore, at the situation which obtained in 1965. The village industries had gone, swept away by the advance of the multiples and mail order firms. Even the dominie and the minister were going with the closure of rural schools and the amalgamation of parishes. The linen industry had long since collapsed, and many of the wool mills had gone under, while the meal mills had shut down one by one in the face of obsolescence and competition from cornflakes. The flagstones which had once proudly paved the streets of Newcastle, Paris, and even Sydney, had been made obsolete by cement and tarmac, The herring had left the East Coast fishing grounds, and much smaller number of white fish boats had taken the place of the proud drifter fleets. Only in the Minch were the "silver darlings" still being found.

Agriculture had been screwed harder and harder at successive Price Reviews over nearly twenty years to increase productivity—a national trend, but one which meant a continual drain of workers from the land. Farms which once employed six, eight or ten pairs of horses were being worked by two men on tractors. Even in public works jobs where fifteen or twenty men would have dug a ditch with pick and shovel, one man with a JCB digger would do it in a fraction of the time. Only tourism and a few new industries—particularly Dounreay—shone like jewels in the general gloom of dwindling job opportunities. So we set up the Highlands and Islands Development Board to try to stem the tide, and to try to turn it.

What did we think the Board was going to be? The description that I like best is a quotation from Franklin D. Roosevelt who, in speaking about the Tennessee Valley Authority, described it as: a corporation clothed with the power of government but possessed of the flexibility and intiative of a private enterprise.' What did we get, my Lords? We got a Government agency possessed of the flexibility and initiative of a Government agency. In what conditions was the Board supposed to work? We on these Benches had hoped, in conditions of reasonable freedom, not, as has proved to be the case, firmly tied to the apron strings of the Secretary of State for Scotland. What were to be the objectives of the Board? Other than the somewhat vague objective of promoting the economic and social advance of the Highlands and Islands, neither the Board nor the last Government ever committed themselves to a target.

Frequently I pressed the last Board to commit themselves to a target, particularly on population trends, but they certainly never gave us any population target figures. No wonder!, when the population has dropped to the lowest figure ever, and has dropped steadily each year for the last four years. No wonder!, when the unemployment figures remain obdurately at twice the Scottish rate and three times the Great Britain rate. Yet population is the key to it all. We should have targets of population, even if we do not hit them; otherwise we do not know where we want to start putting the emphasis, nor do we have a proper yardstick with which to measure success. We must find people to replace those who have been squeezed off the farms and out of the village industries. We must find these people the work, so as to hold them in the Highlands.

Finally, I ask how the Board should set about its task. First, I believe it should divest itself of unnecessary responsibilities. In its Report the Board tells us of the £1½ million that is spent on grants and loans, but a very great deal of that £1½ million spent on grants and loans would have been spent if the Board had never existed at all. It would have been spent, as we have already been told by other speakers, through the Board of Trade, through the Scottish Country Industries Development Trust, or some other agency. The Highlands Board was meant to be an extra instrument—something over and above the existing Government agencies—for aiding development by grant and loan. It was meant to give flexibility and deal with cases outside the scope of the Board of Trade, at the same time sweeping away a mass of advisory bodies. In fact, the Highlands Board has taken on the work of the Scottish Country Industries Development Trust, the Board of Trade to a large extent, and the Scottish Tourist Board entirely, in the Highland area. It will get bogged down in the day-to-day running of these jobs instead of being the extra, the planner and the catalyst.

The setting up of what amounts to two Tourist Boards in Scotland is especially farcical. I would rather see one good, active and professional Tourist Board for the whole country, with adequate funds. The Highlands Development Board should watch over the planning and development aspects of tourism in so far as they affect its area, and step in with advice or extra help where such advice or extra help is needed. It should ginger up the Tourist Board, but it should not have to take over doing its work for it. That means duplication in all sorts of ways.

The Board should prune, too, its unnecessary side-shoots. I never understood the purpose of an appointed Consultative Council when elected town and county councils were there already to give advice and information. At £400 per meeting, I would economise by getting rid of the Consultative Council. Then, having got itself down to fighting weight, and having mobilised its allies in the shape of the Board of Trade, the Tourist Board and the local authorities, and having added the Scottish Country Industries Development Trust once more to their number, the H.I.D.B. should launch its campaign by attacking carefully selected targets in force.

It should not be afraid to be selective. Better to succeed effectively in one county or one town than just to fail by a whisker all over the Highlands. I am not saying that it has failed, but Sir Robert Grieve's rather apologetic foreword to the Fourth Report makes it clear that it has not yet succeeded, and certainly not succeeded as well as Sir Robert himself would have liked. I agree that we should not castigate the Board for losses. This is an omelette which will not be made without breaking a few eggs. If we are to get manufacturing industry into the area, and particularly the more difficult and remoter parts, knowing all the difficulties that there are I am sure that we shall continue to have some failures; but we should not blame the Board for taking the risk, because that is what it is put there to be able to do.

It is time we stopped having the attitude towards the Board of "Don't shoot the pianist, he's doing his best". The Board should know by now that all the Highlands are behind it; they want it to succeed. The Highlands will follow the Board into the fray with every ounce of energy they possess if the Board shows the necessary leadership and attacks its objectives with vigour. The honeymoon is now over, and the new Board must show this leadership if the Highlands are not to be disillusioned.

The Highlands need have no sense of false modesty about what they have to offer, not merely to tourists but to incoming industry. Clean air, space, a conscientious labour force and co-operative local councils have all been found by incoming industrialists. The pulp mill and aluminium smelters of Fort William, A.I. Welders in Inverness, and the great Dounreay Atomic Energy Establishment are no mere flashes in the pan. There are other, smaller successes, too, to show what can be done. Only the pace of development is too slow. Therefore, let us wish the new Board all success in its efforts to increase that pace.

Let it make a real attack on transport problems. These are the greatest single disincentive to industrial growth in the Highlands. Let it make a real effort to get population and economic growth. Self-regenerative growth is what we want in the key growth areas; schemes like the Board's fisheries development policy are what we want to see. Real infrastructure being set up in key areas with advance factories that really are advance factories, with clearly stated targets, is what we want to see the new Board doing. My Lords, I hope that the new Secretary of State will unfetter the new Highlands Board and give it funds sufficient to let it give us this kind of leadership. If he does this, I predict that the Highlands could show the world how to regenerate a depressed area.

4.8 p.m.

THE EARL OF CROMARTIE

My Lords, before I come to my speech, I should like to congratulate the noble Lord, Lord Rankeillour, on his excellent maiden speech. It was very moving and impressive. I claim a little credit for it because I have been asking him for a long time to get up and say something about things that he knows about, and it seems that at last I have succeeded.

This is a debate of the greatest importance and interest to all who are in any way concerned with the future welfare of the Highlands of Scotland. I am most grateful to my noble friend Lord Perth and those who sit on the Cross Benches who have so generously given us time for this debate. I do not wish to hold a postmortem on the old Board, which since its inauguration has done very valuable work in the Highlands and has introduced a considerable amount of capital investment. Of course there were mistakes, some of a rather serious nature; but where is the Department of Government—indeed, Government itself—that never makes mistakes? The important thing is that mistakes should not be repeated.

So far as my own county was concerned, we received—and gave—a tremendous amount of co-operation; and assistance was forthcoming both from individual members and from the officials of both sides. It is necessary, however, that the Board, before embarking on major operations, should consult even more fully with local authorities within its sphere of operations. In this connection, local authorities can provide the Board with the local knowledge which should help it toward better results. By the same token, if the Board would take the trouble to approach landowners in a reasonable manner, I can assure it that in the great majority of cases it would be met with willing and valuable help. Let us remember that there are often several ways of achieving the desired objective, and if someone suggests another way that is not a rebuff and should not be treated as if it were.

If the Board is to succeed in one of its basic tasks, which would appear to be to act as a leader of the many agencies in the Highlands, both public and private, then it is necessary for it to give sufficient attention to methods of appropriate consultation. While a number of long-term inquiries into specific industries or natural resources, some of which are excellent, have been put in hand, it is not apparent that there is any general formulated policy for development work to ensure its long-term success. The closest liaison should be maintained between the local authorities and the Board, as the latter has available an extensive records and statistical section which can be of great assistance to local authorities.

As we all know, there has been some public criticism of the newly appointed Board, and though much of this can be put down to the fact that everything new is always criticised it seemed to many of us that there could well have been a stronger representation of members from, and closely associated with, the North-Western Highlands and Islands, whose problems differ so very widely from the Eastern seaboard of the Northern counties. As noble Lords have already heard from me and others, we are faced with a railway closure in the north-west—an act which has appeared to some as a deliberate attempt to make a large area of the Highlands non-viable, and which will once again force people from their native land and homes.

For some time there have been efforts, both official and unofficial, to make the Government realise the enormity of a decision to close that line, but not one squeak have we heard from those who are supposed to be the champions of the Highlands. We are told that it would be improper for the Board to take any action at present. For heaven's sake! my Lords, let the Board be improper in this vital matter, and by so doing show which side it is on. If it does not, it will run a grave risk of losing the support of the Highlanders for whom it is supposed to be fighting. Let the Board remember that the Highlands are very dependent on rural services, from both the economic and social points of view and that this applies to all services, road, sea, air—and rail. The Board must give more attention to the interests of the public and to the vital social and economic factors.

The small operator and small developer has a considerable part to play in the Highlands and is worthy of help. The Board has placed a considerable emphasis on the economic advantages of tourism, but here again it must realise that if its policies are to materialise it is essential that the necessary facilities are available to meet the increased demands which are likely to arise. If tourists are to be encouraged, then not only must transport facilities be available but also such essential facilities as sites for caravans, and camps, with adequate services. We were given from the Front Bench yesterday an impressive list of Government organisations which might help local authorities in Scotland in their endeavour to cope with the tourist caravan and lished by my noble friend Lord Lovat camping problems. But it was soon estab- that that information fell into the category of sounding brass and tinkling cymbals; and, if your Lordships will forgive a bad pun, there was precious little "brass" available from most of the sources mentioned.

If the Board will act for the Highlands and the people who live there, and show that it is so doing, it will have the cooperation of every man and woman there. Any sensible person must be aware that when public money is being used Government and Treasury must have overall control. But, as has already been mentioned, that control must not be so tight as to frustrate some long-term projects which, in the nature of things, will not at once pay off financially.

My Lords, many Highlands men and women have in the past, especially in two world wars, given tremendous service to Britain. Let us not forget that. Furthermore, the viability of the Highlands will be of future advantage to the whole of Britain. The Highlands and Islands Development Board can play a great part not in preserving a museum but in preserving a vital and happy country and people. If it will grasp not one but several nettles, we in the Highlands will wish it well and will help in every way we can.

4.16 p.m.

THE DUKE OF ATHOLL

My Lords, I should like to start by congratulating my noble friend Lord Rankeillour on his maiden speech, which we thoroughly enjoyed. I always think it is a little unfair that a maiden speech has to be non-controversial, since that is almost impossible to achieve. I am not sure that my noble friend entirely achieved it, but he came sufficiently near to be forgiven. I should like also to thank very much my noble friend Lord Perth for initiating this debate, and for almost taking over the Motion which I had originally put down. That gives me a chance, instead of making a general survey of the Report of the Highlands and Islands Development Board, which I think I should have had to do, of picking out some points to which I should like to draw your Lordships' attention. I should point out that I am standing in this position so that I can keep my noble friend the Minister of State and the representatives of the Highlands and Islands Development Board in my line of fire.

The first point that I should like to make is that there is a fear that the area in which the Board operates has been wrongly drawn. I have always felt that the distinction between crofter counties and other counties is entirely artificial, and the activities of the Board are tending to make it more difficult for the counties on the periphery of the Board's area but not within it to attract the industry which is as vitally needed there as it is in the area of the Board. So I should like to ask the Government to look once again at the geographical boundaries of the Board, and to consider extending its activities to those areas which in character are somewhat like the Board's area.

Coming to the work of the Board, I should first like to congratulate it on the success of its fishing schemes which are absolutely admirable. They bring employment to areas where it is most needed, and produce a peculiarly delicious form of food which is not only appreciated by everyone in this country, but earns us a considerable amount of foreign exchange in exports. The Board has done a great job of work and I hope it will continue to support the fishing industry to the maximum, particularly in the West of Scotland.

I should like to query one item which perhaps comes under the heading of fishing; that is, that in paragraph 159 of their Fourth Annual Report the Board mention an oyster hatchery project at Loch Creran in Argyll. I was wondering if there were any further details of this project, and whether, before financing it, or helping to finance it, the Board took into account the effect it may have had on other industries in that area, including the tourist industry. I do not think that we can look at these sort of projects in isolation. We have always to consider the effects that they may have on already-established industries in those particular areas.

My Lords, I was very pleased to hear the noble Lord, Lord Hughes, say that be thought that one of the best things the Board had done was the encouragement of small manufacturing industries in the Highlands. I agree with him entirely about this. I think that the few failures the Board has had in this field have been easily outweighed by the large number of successes. But I am not entirely happy—in fact, I am nothing like happy—about the Board's major project at Invergordon. It seems to me that there are immense dangers in this. It tends to draw people away from the already under-populated landward areas into the only area in the Highlands of Scotland which, before the activities of the Board, was reasonably well populated and had a fairly viable (in fact, very viable) agricultural industry. There is also the danger, with the particular industry that they have attracted there, of pollution, and I think that this is a risk which the Highlands can ill-afford to take. In the Highlands, we are so dependent on the tourist industry that if anything was to go wrong with the aluminium works I feel it could have a disastrous effect on what is one of our major money-spinners. Personally, I would welcome even less the petro-chemical works to invergordon because I think the dangers of pollution from them must be considerably greater than from the aluminium works. So I am not at all sad to learn that the advent of the petro-chemical works is not as likely as it once was.

My Lords, may I ask one further question about that part of the Highlands area before moving on elsewhere? What has happened about the Kildonan strath report? This was the first comprehensive land-use survey carried out by the Board, and I should be grateful if the Minister could bring us up to date on this. I should like also to ask whether, before this report was finished, full acount was taken of the sporting values. I rather feel that the sporting aspect of Kildonan strath was underrated in this report, and I think that since the report was published this has become even more apparent. Sporting values in Scotland are tending to increase at a much faster rate than either agriculture or forestry. One has only to look at the rents which one can now obtain, compared with those of twenty years ago, whereas the price of a hill lamb has stayed more or less static; and although the value of forestry has increased, I do not myself believe that it has increased at such a fast rate as sporting values. I should also like to point out that much of the sporting value is paid for in foreign currencies by visitors from abroad, and is therefore extremely important to us.

In addition, my Lords, I should like to say that I hope the powers contained in the Agriculture Act 1967 for Rural Development Board powers to be vested in the Highlands and Islands Development Board will be repealed. I do not like the final words of paragraph 196 of the Fourth Annual Report: We intend to examine carefully the implications of the vesting of such powers in the Board,… I hope that if the new Board are still examining this carefully they will come to the conclusion that they do not wish to acquire these powers, as I feel sure that people in the Highlands would resent the Board taking them. Incidentally, I should like to congratulate the people of Wales on putting up such a fine fight against their proposed Rural Development Board, and on the successful conclusion of that campaign. I only hope that the Highlanders would have put up an equally fine fight if they had been threatened with one of these Boards.

My Lords, I think the whole key to the Highlands is communications, and, if one thinks that, obviously one of the vital communications is the Perth-Inverness road. The little activity that there seems to be in improving that road rather appals me. We have had plans for by-passing Dunkeld, we have had plans for by-passing Pitlochry. In this case, the plans have been on the stocks for about ten years, but nothing seems to have happened; not one digger has actually got to these parts. The only bits on which there appear to be immense activity are the two straight bits either side of Ballinluig which they appear to be busy making three-track—a form of road which I thought had been abandoned all over this country about fifteen years ago as being too dangerous. But apparently this will do for this extremely important trunk road.

On communications, I should like to congratulate both Western Ferries and Logan Air on their successful forms of transport that they have initiated in the Islands of Scotland. I think that these two firms have brought a great deal of joy to people who live on Islay and Jura, in one case, and in Orkney and Shetland, in the other case. I should very much like to congratulate them on their initiative in starting these services. This brings me on to British European Airways. British European Airways run some commendable services in the Highlands and Islands which I know make a considerable loss but which, nevertheless, are extremely socially desirable. But the Report, in paragraph 201, makes some recommendations about these services, and one of their main recommendations is that a more effective network could be established by increasing the sector lengths operated by the larger aircraft and by using smaller aircraft on routes over which it is uneconomic to fly planes as large as the Viscount. They go on to suggest that a separate operating company should be set up on a tri-partite basis, involving B.E.A., a commercial air fleet operator and the Board, to take over and run all Highlands and Islands services and airfields. I wonder whether B.E.A. and the Government have considered this. I know that the Government are looking into the question of independent airlines, but this seems to me an excellent suggestion, and I would very much hope that something might come of it.

Lastly, the most important thing in the Highlands, as anywhere else, is the quality of life, and one of the things that appears to be part of the quality of life in this modern age is television. There are no cinemas (or hardly any) and no theatres in the Highlands, and I was very pleased that the Board devoted a paragraph of their Report to the question of television reception. It is paragraph 170. The B.B.C. is a State service, and one of the justifications for this State service is that it should provide lossmaking but socially desirable activities. Yet, my Lords, there is no B.B.C.2 in the Highlands of Scotland, and B.B.C.2, we all know, has the best programmes, or at any rate those of us who live in the Highland area consider that it does.

There is no colour television in the Highlands of Scotland; and there is even a threat to reduce the area which can receive B.B.C.1 when it goes over to U.H.F., 625 lines; and it seems to me to be all wrong that an area with no cinemas and no theatres should have a far worse service than appertains in the cities. I should have thought that a public service like the B.B.C. should have started by these areas where there is no alternative introducing B.B.C.2 in the Highlands; started by introducing a colour service in entertainment in the evening. But of course the real reason why people live and work in the Highlands of Scotland is the scenic beauty, the sense of timelessness and, for some, the isolation; and I hope that the activities of the Board in the long run will not destroy these sides of the good life of the Highlands of Scotland.

4.31 p.m.

LORD STRATHCONA AND MOUNT ROYAL

My Lords, a number of noble Lords have referred to public transport. I should like to leave the noble Duke on the road between Perth and Inverness and go out to the Western Islands, to which he referred briefly, and where, the Report tells us, between a quarter and one-third of the Highland population live. I hope your Lordships will bear with me if I concentrate my attention on one particular service, which is the service to the Isles of Islay, Jura and Colonsay where I make my home: first, because I know more about that service and, second, because I think that the experiences that we have had on this service illustrate some of the problems, and possibly some of the solutions capable of wider application elsewhere. I notice that the noble Lord, Lord Margadale, is to speak later. If I should say anything too outrageous I hope that he will correct me; but I am hopeful that we shall find ourselves in agreement.

In this area of Islay, Jura and Colon-say, until recently MacBraynes had a monopoly and, incidentally, a large subsidy to go with it. They have now been taken over by the Scottish Transport Group. Of course it has always been a favourite local sport to poke fun at MacBraynes, but it is not my intention to do so this afternoon. If any element of criticism enters into what I have to say, it is only in the hope of being able to identify some of the errors of the past so that we can get some guidance as to the direction in which we should go in the future.

The very existence of these Islands depends on finding the right solution to these transport problems. In the case of the smaller islands we must accept that some of the services are going to need an element of subsidy. This is implicit in the Board's remarks about what they call the "flexible road". I think that possibly this is just a little starry-eyed of the Board, but what they are trying to say is that we should regard these ferries as extensions of the roads. I feel that we can probably find some rural roads for which it would be as difficult to justify subsidies as it would be for some of these ferries. The problem, of course, is that the collective subsidy to the ferries is there for everybody to see and to criticise, which is not necessarily true of the small roads in the more remote parts of the country.

Nevertheless, I am going to suggest that the idea that all these services should necessarily come under the umbrella of something like the Scottish Transport Group, with its rather ponderous approach, has its dangers and is not necessarily the ideal solution. It seems to me that the Highlands Development Board would have a useful part to play here in putting the case and in encouraging local enterprises which could be fitted in to the broader pattern. On the Islay run, over the last few years, experience has shown that a smaller organisation can run at a profit in an area where it was previously thought that a subsidy was required for the service to operate at all. This is partly because of their more pragmatic approach, and because they are more sensitive to local requirements, but also because they have been untrammelled by the traditional attitudes which apply to some of the older steamer services. The impressive thing about this is that they have achieved a profit while at the same time reducing fares and improving the frequency of the service. This point has not gone unnoticed on the neighbouring island of Mull, which has not had the benefit of this kind of competition and corresponding reduction in charges.

Throughout all these services, the controlling factor must always be transport costs; for not only do they affect the cost of living of the people who are working in these areas but they directly affect the viability of any kind of commercial enterprise which the Highlands Development Board, or anyone else, may try to introduce, be it farming, tourism, spectacle making or weaving. We do not have the expertise to introduce an electronics factory in our part of the world, even if we had the postal services to carry the products of such a factory. In this connection I was delighted to hear the noble Baroness say that investigation was being made at Aberdeen University into the impact of transport costs on the possibility of introducing manufacturing industry into this part of the country.

What has happened in the case of the services to Islay and Jura is that, learning from experience in Norway, simple, easily handled ships have been introduced and are utilised to the full, running double day shifts with two separate crews. In passing, may I say that I tremble to think of the economics of the service operated by the Scottish Transport Group at the present time. I suspect that they are now making a substantial loss which will, in due time, appear in their figures. The elaborate amenities provided on some of these older vessels must be carefully scrutinised to see whether they are justifiable and cost effective. We are not in this part of the world looking for, or accustomed to, amenities like those on the North Atlantic services, or indeed the Dover—Calais service. Incidentally, I was glad to hear that this point was taken up by the noble Duke concerning the air services referred to in paragraph 201 of the Report we are discussing. The same thing applies there.

My Lords, what we need in this part of the country is bush services. I was impressed nearly a year ago to find bush services being operated by seaplanes around the Falkland Islands. I do not think they were economic; but certainly that represents the right approach to the problem. Logan Air, use small Islander planes, off bush airstrips, and this must be our pattern. The Sands of Barra are the appropriate landing grounds, rather than runways and facilities of the type seen at London Airport. Such services are much more likely to emanate from the smaller and more sensitive companies than from the big nationalised concerns. We want simple, even primitive, services which are cheap, rather than services which are made so expensive by elaboration that nobody can afford to travel on them, so that they become economically non-viable. I think that the choice in the Islands is just as stark as that. This point was referred to in the debate on rural communications, and it is not by any means unique to the West Coast or North Coast of Scotland.

But having sung the praises of the roll-on, roll-off ferries—again a point to which the noble Baroness referred—I should like to mention one complication which arises from this service. We must remember that many people in the Western Islands do not, at any rate at the moment, own a motor car licensed for or capable of going on to the mainland roads. This means that one can find oneself debouched at some distant terminal with no means of getting to the centres of better communications. A concrete example of this is provided by the service which operates in our part of the world, where to catch two out of the three services a week entails leaving Tarbert, 100 miles North-West of Glasgow, at 6 o'clock in the morning; and the last bus to catch that steamer leaves Glasgow at 3 o'clock on the previous afternoon. The waste of time caused by that kind of thing may be envisaged. In fact, my Lords, to use the word "service" of a steamer of that kind is, I think, a gross misnomer. Recently I was talking to a Member of the other place who has a house on Mull. He assures me that it is the popular belief that MacBrayne's employ a computer to make certain that as many as possible of the connecting services are missed by a few minutes by the steamers they operate to that island.

My Lords, to come back to the question of costs, I would urge the Scottish Transport Group to make certain that there is a proper cost analysis of all these costs, and the allocation of costs between the services. Paragraph 209 of this Report contains a masterly understatement of what was in fact a very burning local issue when the Board say that their advice was not taken. The underlying problem, I think, was the difficulty of getting reliable figures about the cost of the ships, both capital and running costs; the cost of the harbour installations and the cost of the associated roadworks. When it is difficult to get these costs the public must be forgiven for suspecting either that somebody is trying to prove a particular case or that somebody does not know because he has not done his homework. In the latter connection I tried hard to extract from the Postmaster General in the last Government the figures for the mail contract for the shipping service. I failed utterly. I do not want to add to the burdens of the G.P.O. at the present time, but this is merely an illustration of what I feel is not the right way in which to judge what sort of service is appropriate for the area.

This leads me to ask for a careful look at the question of how the grants and subsidies for the services are allocated. I believe that some of the irrational decisions that we have seen in the past have arisen directly from the complications in the way in which grants are given. The provision of piers is a classic example. In the last twenty or thirty years most of the piers have been built by the County Council, with the aid of grants, normally of 75 per cent., from the Central Government. Unfortunately, the County Council have not always had a close and forward-looking liaison about what kind of shipping service the piers are being built for. The result has been a formidable waste of public money in an area where there is far too little money to spread around in that kind of way.

I do not want to go into too much detail, but there have been three or four examples within the last ten years. A pier repaired at Islay at a cost of £50,000 has already been abandoned. More money was spent about 15 years ago on a pier at Jura and this I think is likely to be abandoned within the next two years. At my own home on Colonsay something of the order of £160,000 (which at the time someone described as "about £1,000 per skull") was spent on building a much-needed and greatly appreciated pier. Unfortunately, this pier is not suitable for roll-on, roll-off ferries, and is unnecessarily elaborate for such ferries. It was a very close-run thing (this again refers to paragraph 211), and it was only with the greatest reluctance, that the County Council was dissuaded at the last minute, and under the strongest pressure, from spending something of the order of a quarter of a million pounds on building a new pier on Loch Tarbert. The proposed pier has not been missed yet.

Meantime, my Lords, Western Ferries Limited, a small private company to which the noble Duke, the Duke of Atholl, referred, have built three terminals for themselves, without any grant at all, at a cost which is small compared with the kind of figures I have been talking about. From this I deduce that the sensible thing to do would be to ask the shipping companies to build the piers for themselves, on the same kind of basis as the county councils are doing it to-day. In that way they could build suitable terminals for the kind of ships they intend to operate. Reverting to the Highlands Development Board's suggestion, I would ask whether we could not regard the associated roads as trunk routes which would be subject to the same kind of grants from the Ministry as are the main roads in the rest of the country.

Fundamentally, what we are trying to do in all these cases is to get the maximum benefit from the money we spend, irrespective of which particular area the money comes from. Another way in which we might conceivably get the same benefit would be if we asked some of the smaller private operators to tender (if that is the right word) for the kind of subsidy they would require to deal with some of the more difficult transport problems in the area. In assessing what is required let us remember that the priorities by which we consider the kind of service put forward should be, first, cost secondly, frequency; thirdly, reliability; and fourthly, amenity. At the present time one has the impression that they start with amenity, and then go for reliability and frequency; and cost seems to be the last consideration in organising the shipping services. The Highlands Development Board said, and it cannot be put better: The present level of shipping charges places intolerable burdens on all forms of life in the Islands. That, my Lords, quite simply is the problem.

I am very glad to hear that we shall not have to wait very long to hear the result of the Scottish Transport Routes survey of the shipping services. When the results are produced, I hope we shall find that due weight has been given to the recommendations and suggestions of the Highlands Development Board. I also hope that careful consideration will be given to the ways in which the smaller and less sophisticated operators can play their part in fitting into the broad pattern, which I feel sure would be of great benefit to the whole region.

4.48 p.m.

THE EARL OF DUNDEE

My Lords, the first reason that I want to say a word or two is to express my thanks to the former Chairman of the Board, Sir Robert Grieve, for all that he has done. The noble Lord, Lord Hughes, implied that he started off with some unfair critics. I do not know who they were, but he certainly did have, if not tiresome critics, one or two colleagues whose activities did not always improve the public image of the Board. But I always thought that Sir Robert himself did exceedingly well, and I think we owe him a debt of gratitude for five years of service to the Scottish Highlands.

My next purpose is to say how delighted I was to hear that Sir Andrew Gilchrist had succeeded him as Chairman of the Board. When I was Minister of State for Foreign Affairs, six or seven years ago, Sir Andrew was sent out as Ambassador to Indonesia, about the time when the British Government, with the approval of the United Nations, made over our former colonies in the Island of Borneo to the new Republic of Malaysia. This infuriated President Sukarno, who wanted to annexe these territories for himself. He vented his spleen against Britain by withdrawing the police protection from the Embassy in Jakarta and then inciting a violent mob of Communist hooligans to attack the British Embassy day by day. On the first day 400 plate glass windows were smashed and Sir Andrew's car was pulled out of the garage and burnt. He was confronted by this violent mob, and if I may use his own words—I think I can remember them rightly—he said that he: "retorted upon the crowd with the bagpipes", which were played by his military attaché.

A day or two later the Chancellery was gutted by fire. The staff of the Embassy remained at their posts, although their lives were in constant danger throughout the whole of this period. They were heartened in the morning by the playing of the pipes, and their coolness and courage had a tremendous effect on public opinion in Indonesia. By the time Sir Andrew's term as Ambassador was concluded, two and a half years later, the Communist Party in Indonesia had been destroyed by the Indonesian army, and President Sukarno was eclipsed, deprived of his power and soon to be deposed.

By a rather curious coincidence, Sir Andrew's last post as Ambassador before that had been in Iceland, which happened to coincide with what was called the "fish war" in 1958, when his Embassy in Reykjavik was attacked and stoned by a mob of Icelandic Communists. I do not think that he had his bagpipes there then, but he opened a window and played a very loud gramophone record of bagpipe music, which I am told had the effect of dispersing his assailants.

In case your Lordships should draw the conclusion that the new Chairman of the Highlands Board is a man who always provokes antagonism, let me add that his last diplomatic post was as Ambassador to Dublin, where he contracted warm friendships with the Ministers in the Irish Government to whom he was accredited, which proved to be extremely valuable to all three Governments concerned, the United Kingdom Government, the Irish Republic Government in Dublin and the Stormont Government—as I am sure my noble friend Lord O'Neill of the Maine, who is here, will agree—when the present troubles in Ulster began.

For those reasons, I was a little surprised a few months ago when I saw in some Scottish newspapers certain objections to Sir Andrew's appointment to the Board on the ground that he is not a Highlander. It is true, I believe, that he was born in Lanarkshire in the Lowlands, but I understand that the name of Gilchrist is one of the most ancient names in the Highlands, and I can think of no one better fitted to be Chairman of the Highlands Board than this gay and stout-hearted Scot, who is never dismayed by dangerous odds and who always confronts his adversaries with Highland music.

The policy which he and the Board will have to try to help us with in the Highlands (I think all Parties are agreed on this), is first to create a larger population there, with a bigger proportion of young people who can find the kind of life that they want in their own country. The other purpose is to increase the economic wealth of the Highlands. I know your Lordships will at once agree that although these two objects can be combined, they are not the same, because productivity often means producing more wealth with fewer people. If you take the Board's initial paragraph on agriculture, you will find that they say: The development of the agricultural industry in the Highlands cannot be expected to make any significant net addition to the numbers employed in the industry. They go on to say: The Board's role must be to help to raise the productivity … to increase farm income and thus help encourage young people to stay in farming. This is a formidable task. In 1961 there were some 8,600 full-time farm workers in the region; by June, 1968 this figure had dropped to 4,800 and it is expected to level out at about 4,000. I suppose that by "level out" they mean that it will first drop to 4,000 and then stay there. I agree that it will drop to 4,000, but I am not sure about its staying there: I think it may go lower still. But whatever the future may be, as the population of the five crofting counties in the last Census was 273,000, it is clear from these figures that the effect on Highland population of improving Highland agriculture, while I am all in favour of it, is certainly minimal.

The Board have a great deal to say on industry in their Report, and I think it is most interesting. All I would comment is this. I should like to add my agreement to what both the noble Lord, Lord Hughes, and my noble friend the Duke of Atholl have said: I agree that the best thing the Highlands Board have done is in giving their successful support, either in maintaining existing small industries which would otherwise have died, or in creating new ones.

I remember Lord Thurso's father when he was the Member for Caithness and Sutherland telling the House of Commons with great pride about the coalmining in Brora, which he thought was a remarkable thing to have up there. This coal mine was going to be closed down a few years ago because the seam was worked out, but the mining community at Brora requested the Board to do something to keep it going. They said that they were willing to take over the mine themselves. The Board paid for boring and new prospecting, and unexpectedly rich new seams of coal were found. I had the privilege of going down this mine fifteen months ago with some of my friends from the House of Commons, and we all agreed that perhaps when in two or three generations' time all the coal mines in England, Wales and Southern Scotland had been worked out and come to an end, Brora might then be the only coal mine surviving in Britain.

It may be a good thing, also, to have one or two groups of larger industries, like the Moray Firth or the Fort William area; but I will not dispute about this with my noble friend the Duke of Atholl, because I do not live near there and my knowledge of the facts is not extensive enough for me to be able to speak on it with any certainty. I think that probably the Moray Firth area is considered a suitable place because of its good harbours, which are not found everywhere. There are very few places in the Highlands where you can have a large group of industries, and you must be careful where you put them. The great advantage of spending public money on encouraging the establishment of manufacturing industry compared with other occupations is that it creates more employment rather more quickly than other projects: and it is an urgent matter to get the trend of declining population in the Highlands not only stopped, but, as the noble Lord, Lord Hughes, has said, reversed.

I think that the Board's remarks on tourism are not quite so concise or well arranged as those on industry, but they make one thing clear; that is, that the need for more tourist accommodation is not keeping pace with the demand for it by tourists and that we ought to get a move on much more quickly. As your Lordships know, I have always taken the view that one of the main hindrances in the Highlands has been the selective employment tax, and I was delighted to hear what my noble friend Lord Perth said about this, and was even more delighted to hear what my noble friend Lady Tweedsmuir said. I know that she would not have been so chirpy without good reason. A Minister is not allowed to say these things unless the Chancellor of the Exchequer has been very definite indeed. Of course, she says that she cannot give us the time and manner. As for the manner, I should think that there is only one manner in which you can abolish a tax—either you have it or you do not have it. As for the time, that is a different matter, and although I know my noble friend Lady Tweedsmuir cannot anticipate the Budget Statement, she probably can anticipate that if the Government's promise to abolish S.E.T., is not fulfilled reasonably soon there will be quite a lot of people who will want to know the reason why.

I should like to refer to forestry. As your Lordships know, I have always argued that this is a most fundamental matter in the long run. The disadvantage I have always realised is that it is a very long run. Many years ago I gave the noble Lord, Lord Hughes, an example of the results of large-scale afforestation in the Highlands. There are few of them because so little large-scale afforestation was carried out anywhere until quite recently. The amount which the Forestry Commission were allowed to do between the wars was pitifully small in its extent. They had one big forestry estate at Dalavich. The land already had a lot of growing timber on it when the Commission took it over, and they proceeded to make quite a large forest there. The figures which I gave the noble Lord, Lord Hughes, six or seven years ago were from the Census of 1921, which showed a population in the whole parish of 55 persons, of whom 11 were children. This compares with the Census of 1961, the most recent one, which showed a population of 373 persons, of whom 126 were children. So the total number of people had been multiplied by seven, whereas the total number of children out of that figure had been multiplied by eleven and a half.

People often say, "The population problem is an urgent one. Why should we spend money now on planting trees for results which will not be realised for 50 years?" It is true you get some employment benefit from the actual planting of the trees. That is not the same as the benefit of rotational felling and replanting when the wood comes in to full thinning and felling production. I always reply that, although I admit that, supposing our great-grandfathers and our grandfathers had carried out the planting that they ought to have done in the Highlands sixty, seventy or eighty years ago, how grateful we should be to them now! Is it not right that we should take the action which will make our grandchildren and great-grandchildren as grate- ful to us as we should have been to our forebears if they had done what they ought to have done? Instead of having one Dalavich now, we should have 500 of them, and the problem of Highland depopulation would be virtually solved. I am not suggesting that forestry is the only solution. But, particularly in the Highlands, it is something for which we should go all out for and to which we should give priority.

I was always a little disappointed that the first survey which the Highlands Board undertook was in the Kildonan area. From the point of view of forestry, that is one of the least favourable areas in the North East of Scotland, where the soil and climate are such that it is possible to grow only a third-rate crop of pine trees which will not mature for about 90 years, whereas in the West Highlands—Argyll, Inverness, Ross and Cromarty; and many places outside the area of the Board—we have some of the best soil for quick growing conifers in the world. It is better than that in Austria, where they have a very fine timber economy; it is better even than that on the West Coast of North America. The resulting employment from the forests would be about 13 times what is now provided by sheep farming; and, of course, there are the ancillary industries, the factories for processing the timber, which will spring up.

I should like to conclude by saying that I agree with the noble Duke in what he said about the Rural Development Boards—indeed, I had intended to say this. I will not read out what is said on page 70 of the Report, but it is pointed out that if the Secretary of State exercised his power to give the Highlands and Islands Development Board the functions of Rural Development Boards, they would be able to stop people planting certain areas of land which, in the opinion of the Board, ought not to be planted but should be used for something else. That is not a positive function; it is a negative one. It is not getting a move on; it is stopping people from doing that. One point which I would very respectfully put to your Lordships on this matter of Highland timber planting is this. Do not ever stop people from planting. Do not force them to plant trees if they do not want to do so, but if any man ever wants to plant a tree, do not stop him from doing so.

5.8 p.m.

LORD MARGADALE

My Lords, I venture to address the House to-day for two reasons. First of all, nearly fifty years ago my father sat as a Member in another place, and the only speech that he made in 12 years was on the subject of shipping transport in the West Highlands. Secondly, I have been connected very intimately all my life with the island of Islay. I have read this Report with much interest, and also I have read a small brochure (for want of a better word) which I found in the night sleeper from Glasgow only last week which extols the potentials of the Highlands, and tells of something of the work of the Development Board. I should like to extend to the Development Board all good wishes in their work.

I should like to comment very briefly on some points, in a rather off the cuff fashion. If your Lordships look in the Report at the number of projects approved in 1969 (and there is also reference to the number of projects approved from 1965 to 1969), you will see that by far the smallest amount of Development Board grant has been given to agriculture, and the biggest amount has been given to tourism. I do not belittle the needs of tourism at all; that is very important, and can do a great job. As the noble Lord, Lord Hughes, said yesterday when talking about the delights of camping and caravanning, the tourist season is very short indeed. Traditionally it was July and August, and now it has stretched a little more both ways. Agriculture goes on all the year round, and employs people all the year round.

Although under another Appendix (I think No. XII) there are certain rules that other Departments, particularly the Department of Agriculture, have to be asked before any help can be given to anything connected with agriculture, I suggest that there is scope for further help to matters which are not covered by the Department of Agriculture—for instance, in the Islands, cattle pens for loading cattle on ships, usually nowadays in the middle of the night. At a time when many Islands are trying to go brucellosis-free it is becoming increasingly difficult to get stock to the markets. I refer to things of that kind.

Distilling is of course mentioned in the Report. It has done a remarkable job for our exports during the Board's existence. I am afraid that I am only a casual consumer, as other noble Lords may be; I am not connected with distilling in any way, but it does a great job and helps to keep constant employment going in those areas of the Highlands and Islands where it takes place. Those concerned should be congratulated on what they do.

I should now like to turn very briefly to transport or communications. I would say how much I support most of the speech of the noble Lord, Lord Strathcona and Mount Royal—he lives in the neighbouring Island of Colonsay off the North shore of Islay. The main point that he made was that the small islands must look to some form of Government support for their essential transport or they cannot keep going as an entity, an island. As one who happens to live on a bigger island, I should like to support him in that. He referred to the position of shipping and Western Ferries. Here I would declare an interest in that I am in a small way connected with Western Ferries.

The noble Baroness who spoke from the Government Bench referred to roll-on roll-off ferries, as have other speakers in the debate. These are very important. I am very glad that the Scottish Office has noted this and I thank her for talking about it. The fact remains that the roll-on roll-off ferries are in two categories; you either roll on aft or forward, usually aft, and one can sometimes do both on the same ship. But the piers necessary for them, as I think my noble friend Lord Strathcona pointed out, cost very much less than the traditional pier to which a ship ties up. There are some traditional ships still being made with roll-on roll-off facilities which are side loading. That entails a lift, and if there are a lot of motor cars to go on and off it takes so long that the ship cannot keep to its schedule. I am not a shipping engineer, but I suggest that this matter possibly needs tighter investigation, as it is cheaper all round for transport. Transport is the secret of the whole of the wellbeing of the Highlands and Islands, as I see it. If we help transport—I hope this point will not be forgotten by the Board or the Government—that will in fact help the whole of the Highlands and the Islands and the remote areas which have increased on-costs at every rise in transport costs.

Mention has been made of television by the noble Duke, the Duke of Atholl. I would say that this is a real, sore point in the Islands. There, one is lucky if one can receive Northern Ireland, and one can get practically nothing else. In view of the hoped-for return of populations to the Highlands and Islands, I hope that this matter will be looked into and dealt with quickly as soon as money is available.

Mention has been made of air transport. Certainly to the Island of Islay there is an excellent service by B.E.A. Viscount, but to many of us it seems that it would be more practical and more economic if a smaller plane went more frequently, rather than just one plane, which in the winter is usually pretty empty. It would help the economics of travel if that could be done. Again, I humbly suggest that this point might be looked at more closely.

Mention has also been made of forestry—I see the Chairman of the Forestry Commission, the noble Lord, Lord Taylor of Gryfe, in his place. I am interested in forestry and appreciate what forestry does for many areas, but having lived, whenever I can, on the Atlantic coast and seaboard I know that trees do blow down; and however regrettable that statement may be, it must be remembered.

5.16 p.m.

LORD HOY

My Lords, I have listened with great interest to the speech of the noble Lord, Lord Strathcona and Mount Royal. It is a tale of the lack of pier facilities on the Island of Colonsay. I remember that island with great enjoyment, because the first time I paid a visit to it the habit of unloading the boat was such that cattle went first, goods second, passengers last. As a consequence, I was detained on the island from Tuesday morning until Friday morning. Then I had to wend my way home by Iona, crossing over to Mull, from Mull to Oban, and by train to Edinburgh. The weather was absolutely delightful and the total cost had to be borne by the Lord Strathcona of that day. I cannot think of anyone who was entitled to a free holiday more than I was. I enjoyed it, and I only hope that the facilities will improve, because I have a warm regard for that particular island.

It seems a little time since the noble Lord, Lord Rankeillour, made his maiden speech, but as the first noble Lord on these Benches to follow him I take the opportunity of tendering congratulations from those who sit on these Benches. Like the noble Duke, the Duke of Atholl, I would hardly have regarded his speech as non-controversial, but at least it was delivered in a very pleasant voice and it showed sentiments we are not normally used to; and because of that it was refreshing.

The Highlands and Islands Development Board has done a first-class job of work. Indeed, in its last Report it pointed out that by an investment of something like £11 million it had provided more than 4,000 jobs to people in an area where employment is very scarce indeed. So it was taking jobs to an area of this country that is in more need of them than almost any other community. For that it ought to be commended. One remembers the difficulties with which the Board is faced in having to meet the needs of one-man businesses upwards. The difficulties are bound to multiply and I think the Board ought to be commended on the job it has done.

I should like to know from the noble Baroness who is to reply whether it is intended to extend the powers of the Crandon Island Development Board so that it is not quite so dependent on getting approval for any grants it has to make. This point was raised by the noble Earl, Lord Cromartie, in the course of his speech. It will be noted from the Report of the Select Committee on Scottish Affairs 1969–70 that this particular point was raised during the Committee's proceedings. The Board said that it felt it could do with more money. That is not unusual; I have never heard of a board that could not. But the Board also felt that it would like to have greater discretionary powers to use its existing money. This was objected to by the Minister of Technology at that time. Paragraph 27 says that the Secretary of State maintained that the problems of the Highlands and Islands are unique. It goes on to say: We agree; and we think that the Board must have special powers to deal with them. We have some doubts whether the present "edge" is in practice sufficient, and recommend that the question of increasing it should be further studied. The point raised is whether the total sum of which they can approve without getting grants from other Departments should go up from its present £50,000 to perhaps £100,000. When it first started, the sum was limited to £25,000, so while it has already doubled it may be that in these days of inflation that sum is also getting out of date and that something considerably more ought to be granted. I would say to the noble Baroness, Lady Tweedsmuir, that when the Committee presented this Report it was unanimous, and inasmuch as the present Under-Secretary of State at the Scottish Office, who is responsible for this particular Department, was a signatory to the Report, I expect she will get very little objection from that direction.

One of the things that is highlighted in the Report and has been mentioned by the noble Earl, Lord Perth, and others, is the fisheries development. Indeed, this particular aspect of their work was highlighted by the new Chairman, Sir Andrew Gilchrist, in an article which appeared in yesterday's Scotsman. It is a story that is really worth telling. Immediately there came to my mind the thought that, were the H.I.D.B. to go on doing this job, what grants would be available to people who applied for them? Are the new participants likely to be less favourably treated than those so far?—because as a result of an Order which will be promoted in your Lordships' House next week it is intended by the Government to cut the grant from 40 per cent. to 30 per cent. Obviously, this will have a considerable effect on certain fishing areas, but I should like to know whether it is intended to do the same with the fishermen inside the Highlands Development area, because not only has it improved the fishing facilities, not only has it made a more prosperous fishing industry, but as the noble Baroness will be well aware it has also created greater employment in boat-building yards inside that area.

Much work has been provided because of what has been undertaken by the Highlands and Islands Development Board with regard to the fishing industry. So I would be grateful if, before the debate ends, the noble Baroness could tell us —she was speaking obviously with the approval of the Treasury—specifically about S.E.T. I hope that she will be equally specific about what is a matter for the Scottish Office, and that she will be able to tell us that, irrespective of what might happen in other places, those who engage in the fishing industry in the Highland and Islands will not be penalised by any cut in the grant.

I welcome the new Board, and its Chairman, while paying tribute to his predecessor. And, if I may add just one other word in that respect, I should like to say a word of praise of Mr. Tom Fraser, the present Chairman of the North of Scotland Hydro-Electric Board, who also did a first-class job in transport; and I was grateful last week to hear the noble Earl, Lord Ferrers, convey his appreciation of the work he had done. We should like to know what are the new Board's plans for the future. In the same article in yesterday's Scotsman, Sir Andrew said that they had had numerous inquiries as a result of the publicity campaign, and indeed they were busy seeing what contribution they would be able to make to a solution of the problems in the Highlands and Islands. I wonder whether the Minister will be able to give us a little more information to-day as to what are the possibilities arising out of the 750 inquiries. Even if only between 5 and 10 per cent. of the schemes could be approved, that would be making a considerable contribution to solving the economic problems of this area.

Here I must part company with the noble Duke, the Duke of Atholl, and the noble Earl, Lord Dundee. They seem to be enthusiastic about having nothing at all to do with the Rural Development Board—indeed, the noble Duke went out of his way to congratulate the people of Wales on having abolished something they never had. All I want to do is to enter a word of caution.

The noble Lord, Lord Margadale had one complaint to make: he said that if the Board was failing in anything at all (though "failure" is perhaps not the right word) it was that it ought to give more attention to the agricultural content of the Highlands and Islands. That may well be, my Lords. But if in fact some further power was given to the Board through a Rural Development Board, it might well be able to undertake this task. I do not know whether there is any overlapping between the Highlands Development Board and the Rural Development Board. I would ask noble Lords not to close their minds to the idea before they have given it due examination. Let us see whether it cannot be improved; and, indeed, as a consequence we might be able to help the Crofters' Commission. I listened with a little warmth to the tribute paid by the noble Lord, Lord Rankeillour, to the crofters; but they, like other sections, are willing to take assistance if they can get it. And if assistance is required, even for social purposes, then there is a responsibility on the Government, even through the Board, to see that that assistance is given.

I should also like to raise one further matter, and that is the position of the liaison between the Board and the North of Scotland Hydro-Electric Board. The noble Lord, Lord Strathclyde, who is to speak after me is, of course, a very old Parliamentary colleague who rendered great service as Chairman of the Board, and I have no doubt he will make his own contribution. But if in fact development is to take place in many areas of the Highlands and Islands it is very much dependent on electricity supplies. Indeed, I know of one project which interests me (it concerns a firm in my old constituency) in which the part played by electricity will be of great importance; and it may well be that a closer union is necessary between these two Boards so that they could plan on a much broader basis the future development of the Highlands and Islands.

This is not to detract in any way from the work the Board has done, but obviously a tremendous amount of the time of its planning department has been taken up in meeting the requests from single areas. They are all important, but it may well be that as a consequence of this, time has been taken away from a long-term development plan. So I suggest that we might have some words on the future policy in this respect, and I am sure that all noble Lords in all parts of the House would be grateful to the noble Baroness, Lady Tweedsmuir, if she would provide them.

5.29 p.m.

LORD STRATHCLYDE

My Lords, I am quite sure that all Scottish Members of your Lordships' House are indeed most grateful to the noble Earl, Lord Perth, for having initiated this debate. We must all hope that it will be helpful to us as individuals, helpful to the Board and helpful to those of our fellow-countrymen who live in the Highlands and Islands. My interest in that part of our country stems from the fact that for a period of about eleven years I had the privilege of bearing some responsibility for its welfare. I feel it is proper that from time to time we should examine how the Board is fulfilling its remit. When a new agency such as the Highlands and Islands Development Board is set up, great things are expected of it. Everything is to change almost overnight, change for the better. Of course, that just does not happen, and then there is disappointment, which often turns to criticism, and that criticism is often unjustified and often unfair. I will try this afternoon not to offend in either of those directions.

When the Board was set up, I had for some years been the Chairman, as has been mentioned, of the North of Scotland Hydro-Electric Board. Your Lordships will know that the Hydro-Board Act laid down that the Board was to do everything it possibly could to improve the social and economic conditions of its area, an area which to-day extends to the greater part of Scotland, an area which lies North and West of a line roughly joining Dundee to Dumbarton. That was a duty which the Board took very seriously, and under Mr. Tom Johnston it created a section of its staff under its chief commercial officer to implement it. Mr. Johnston himself took a great interest and played a predominant part in its work. So over the years there was accumulated much information and experience as to the requirements of the people, the needs of its various areas, where certain policies might be successful, and, what to my mind is just as important, where they were not applicable and could not possibly succeed.

It was in those circumstances that Mr. Grieve, as he then was, called on me. We had a number of meetings in the early days, when I was able to assure him that he could rely on the full support of the Hydro Board. Mr. Bailey, who was the Board's chief commercial officer, was made available to him at all times and was, to a great extent, seconded to the new Board. I have always felt that more might have been made of both his knowledge and his experience. Nevertheless, one recognises that a new authority usually prefers to find its own way and to go ahead under its own steam.

Looking at the Board's Fourth Annual Report, I was indeed happy, as so many of your Lordships were, to see that so much was being done in regard to fishing. When I visited the West coast fishing ports after the war—that was in the early 'fifties—I was absolutely astonished to find that whereas in other days there had been a very considerable number of West coast boats working there, that was no longer the case. The crofter fishermen in fact had disappeared. The cost of boats had become too high, so I was told, to allow the crofter to give part of his time to his croft and part of his time to his boat. To be viable, his boat had to be employed full time. His place had been taken by perhaps larger boats from the North-East coast, mostly from the Moray Filth ports. That situation the Board is now seemingly rectifying, and I, together with other of your Lordships, am extremely glad of it.

There are many other of the Board's activities well worthy of commendation, but time does not permit me to deal with them this afternoon. I note, however, from the Report that in 1968–69 its expenditure amounted to some £2,300,000 and its staff exceeded 160. Possibly to-day those figures are considerably increased, maybe to £3 million and to a staff of 200. I wonder whether the Minister will be able to inform us on that subject when she comes to reply. That is a great deal of money, while the staff is also not inconsiderable.

Looking through the Report, I wondered whether all the matters which were being studied and investigated were really necessary and whether there was not being done over again work which had within recent years already been done. For example, I came across an investigation into the uses of peat, and my recollection is that only a very few years ago there was a Committee under Sir Edward Appleton which, over a period of years, investigated the possible uses of peat. Then I came upon another reference to an investigation into mineral resources. Have there not been two inquiries recently into that particular subject, one by a body that I think was called the Highland Panel, over which Lord Cameron presided, and the other by the Scottish Council (Development and Industry), which went fully into that matter? Here may I join with those of your Lordships who have already spoken of the great debt we owe to the late Lord Bilsland.

There are numerous paragraphs in the Report dealing with matters which I should have thought were adequately covered by other organisations and Government Departments. Some of them that struck my mind were land improvement and reclamation, forestry, agriculture, the infrastructure necessary to back up the development which is taking place on the shores of the Moray Firth and particularly in the Cromartie Firth. These and other matters are surely already in the competent hands of bodies such as the Scottish Development Board, the Department of Agriculture and Fisheries, the Home and Education Department, the Forestry Commission, the National Farmers' Union, the Scottish Council and the Landowners' Federation, to say nothing of the local authorities. I make that comment merely because I consider that you can have too many people fishing in the same pool. One may foul another's line and a very good fish may well be lost.

The noble Lord, Lord Hughes, has spoken of the part played by the Hydro Board in bringing industry to the Highlands. Truly, as the noble Lord said, the Board made great efforts to attract new industry and otherwise to help industries already established. I note in the Board's Annual Report a reference to the installation of a grain-drier in Easter Ross. Let me add that for more than 25 years the Hydro Board has been supplying grain and hay driers to farmers within their area, and, with these, supplying farmers and crofters alike with helpful advice. And the introduction of the fish farming also owes much to the Hydro Board.

In that connection, I hope that the newly-constituted Highlands and Islands Development Board will co-operate to the full with every authority working for the benefit of the Highlands and Islands, and not least with the Hydro Board, and that it will avoid a repetition of a most unfortunate incident which created a very bad impression in Birmingham. The incident occurred through the Highlands and Islands Development Board staging an exhibition in that city a few days after one staged by the Hydro Board, and to which the local Sunday paper, I understand called the Mercury, devoted a most scathing article, pointing out that for some eight years past the Hydro Board had been pursuing an active campaign to persuade industry which was having difficulty in finding room for development in Birmingham to move to Scotland, and supplying all such firms with details of suitable sites available and the help they could expect from the Government and local authorities, together with all other relevant information. Such an incident points to the need for more consultation and co-operation.

Though the Highlands and Islands Development Board should have passed through its teething troubles, it still will have many difficult tasks ahead, and every one of us must hope that it will successfully surmount them, to the great benefit of the Highlands and Islands, and indeed for the benefit of our country.

5.40 p.m.

LORD BALERNO

My Lords, I should like to join with other noble Lords in thanking the noble Earl, Lord Perth, for making this debate possible, and also his fellow Cross-Bench Peers for giving up their right to a debate this afternoon. The noble Lord, Lord Strathclyde, has spoken of the work of the late Sir Edward Appleton, Vice-Chancellor of Edinburgh University, on the big development in, I think, Caithness—or was it in Ross? This is an example of the work done by the Scottish universities in connection with the development of the Highlands. It goes back a long time and covers many aspects. I am particularly glad to see tabulated in Appendix XI the investigations and research.

Naturally, the University of Aberdeen has furnished the greater number of experts. The list of the works on which they have been helping the Board in the making of surveys is impressive. Strathclyde and the Heriot Watt Universities have also been called in aid on the tourist front, while the University of Glasgow is making a social survey of the Uist, and (just to show that we are not too parochial in Scotland) the aid of the University of Sheffield has been called in on a subtle development concerning the extraction of wax from peat.

It is of fundamental importance that these surveys be conducted, and I think that, by and large, the use of the universities and of other experts has been one of the most promising aspects of the work of the Highlands Development Board. The work which has been done at the Board's behest by Dr. R. H. S. Robertson on the discovery, and then utilisation of minerals is of the utmost importance. This is one of the most fundamental of natural resources. It is satisfying to know that a native Scot is carrying on this work with a predominantly Scottish team.

Fish farming is another important matter about which the Board have had to go beyond Scotland for expert advice. According to the Report, the Board have spent up to £130,000 on fish farming for both fresh water and salt water fish. The expert they employed for this job was one of the United States Government experts. To my knowledge, that field of fish farming has been practised on a fairly considerable scale in North America for at least 120 years. Considerable experience has been gained, and a great deal of scientific work has been done on the subjects both of the management and of feeding of fish. This work has been done mostly under Government subsidy, although a number of the fish farms have been instituted by individual States as well as by a great deal of private enterprise. In the United States and in Scandinavia, particularly in Norway, fish farming has developed rapidly. It was absolutely essential that the Board should go outside Scotland to obtain advice.

I was interested in what the noble Earl, Lord Dundee, said about forestry, and I support him. Without a continuing afforestation policy Scotland would be much the poorer, and any grouses which noble Lords may have in regard to forestry versus agriculture are completely and absolutely unnecessary. This is a matter of good will: we must have good will on both sides. I know that the Forestry Commission go out of their way to be helpful in this matter. There are bound to be clashes. Perhaps things could be made better were the Forestry Commission to remove their headquarters to some part of the Highlands. A little bit of development at Inverness, might, shall we say, help to smooth out local difficulties which are obviously cropping up in this debate.

I should not like your Lordships to have the idea that agriculture is of no importance in the Highlands—though some noble Lords may have reached that conclusion after hearing some of the speeches to-day. Agriculture is still the basic industry in the Highlands. Although in the immediate future, or even in the foreseeable future, it is not going to attract a great increase in the labour force, I should like to know where in Britain one expects to get any substantial increase in the labour force in agriculture. As agriculture is becoming more intensive and more efficient, it uses fewer men; and it has been increasing its efficiency at such a rate that fewer and fewer men are being employed. The fact that fewer men are being employed in agriculture in the Highlands does not imply that this industry is being inefficiently run or is of minor importance. There is still scope for increased production in the Highlands. There are areas where a more intensive form of livestock production could equally well be introduced as in other parts of the United Kingdom. It is also the nursery for the breeding stock which, crossed to suitable sires, will produce the animal for the ultimate market.

The noble Lord, Lord Margadale, mentioned brucellosis-free dairy cows and the supply of brucellosis-free dairy heifers. This is a good illustration of the possibilities in that direction. But I agree with the noble Lord that the cost of transporting animals can kill that potential industry. It is fundamental to its success, especially from the Islands' point of view, that transport should be efficient, even although the noble Lord, Lord Hoy, has to stay out and be stranded for an extra week on the Islands.

The noble Duke, the Duke of Atholl, spoke about the area of the Board being wrongly drawn. I can guess what part of the area of the Board he thought should be extended. I should like to put in a plea for an even more important extension of the Board's area, to include the Island of Arran. If any part of the Islands is suitable for inclusion and should have been included in the area of the Board from the outset, most certainly it is the Island of Arran. It is an island; it is Highland, and on one side is Kintyre, almost holding it in its arms. It is an island which has very considerable tribulation and difficulty to contend with: social difficulties and material difficulties. At the present moment, it is very much in the eye of the people in Scotland through its totally inadequate and inefficient transport services by the Island ferry, "Caledonia", in which nobody seems to have any confidence whatever: it has, indeed, been described as the "death boat". The venom is against its inefficient running, landing its passengers sometimes at Ardrossan and sometimes at Fairlie. It assures its passengers that they will get to Glasgow, but that is poor consolation for a person who has driven a car to Ardrossan and is then landed back at Fairlie and has a long way to go, on his feet, or by hitching a lift, to get back to where he had left his car.

When the Bill setting up the Board was going through the House I pressed the noble Lord, Lord Hughes, that this Island—this very "Highland" island—should be included in the Board's area. He gave very good reasons as to why that and other areas were not included in the first instance, because the Board had to find its feet, and that it could then extend. However, I would say that he made very encouraging noises that ultimately the island of Arran will be included, or has every chance of being included, in the area of the Board.

I wish the Board well in their operations. I think that, on the whole, after the first period of stickiness, they have got off to a good start. I can remember that when the Bill became law we wondered where on earth the Government were going to find a suitable man to be Chairman. They came up with an excellent choice, and we must be grateful to them and acknowledge that, if they had not got as good a man in the saddle when that crisis came, a year or two after the setting up of the Board, things might have been very different, and we should not now have been so congratulatory about what the Board have done. We owe a very big debt to Sir Robert Grieve for getting the Board started as he did. Also our good wishes go to Sir Andrew Gilchrist. If I may say so, I think that his appointment by the Secretary of State for Scotland was an inspired one.

5.54 p.m.

VISCOUNT MASSEREENE AND FERRARD

My Lords, I should like to start by apologising to the noble Earl, Lord Perth, for not being here when he made his speech. I was held up through unforeseen circumstances—and they really were unforeseen circumstances; I am not just making that up. I am going to relate my remarks chiefly to land use, and in so doing I do not underestimate the vast importance of manufacturing, tourism and fisheries in the Highland economy.

Before I go on to land use, may I first turn to Appendix IX of the Report? We see in this Appendix that manufacturing industry, tourism and fisheries, have provided the majority of estimated new jobs shown there during the time the Board has been going from 1965 to 1969. If we turn a page back—still in Appendix IX—we then find something rather interesting. We find that although manufacturing has created 1,600 estimated new jobs, tourism has created 1,200. The point is that whereas tourism has received free grants of £1 million, manufacturing industry has received free grants of only £400,000. We then get fisheries, which come third. Fisheries created estimated new jobs of 600. The interesting point is that agriculture has produced extra jobs in the last four years for only 50 people, while fisheries have produced jobs for 600 people and have received only double the amount of free grant that agriculture has. There is surely a moral here. I submit that the moral is that if you want to create jobs in the Highlands, and if that is the object of the Highlands Development Board, then we appear to get better value from manufacturing industry, fisheries and tourism—although tourism has been very expensive in capital grants.

May I now turn to land use? The noble Earl, Lord Dundee, quoted Paragraph 169, which is the start of the chapter on "Land Use" in the Report. I will not quote the noble Earl's words, because he read out this paragraph; but I should just like to quote this: The Board's role must be to help to raise the productivity of agricultural units, where this can be achieved economically". "Where" is the operative word. I do not want to throw a note of discord into these proceedings, but let us be practical. I do not believe it is possible to raise the productivity of hill sheep farming in the Western Highlands. I mean that you cannot raise it economically. You can raise the productivity if you are prepared to spend hundreds of thousands, and perhaps millions, of pounds. I sheep farm in the Western Highlands in quite a big way, but I say that you cannot raise productivity economically. I have seen tens of thousands spent on reclamation, liming and re-seeding, but in the high rainfall areas of the West it is not economic. You may be able to make two sheep graze where one grazed formerly, but it will not be economic. There may be one or two favoured areas where you can do that, but those areas are very few and far between.

As the noble Baroness indirectly pointed out, even if you can get two sheep to graze where one grazed formerly, you are not really going to employ many more men in agriculture. Therefore, while agreeing that hill sheep farming may be the main agricultural activity in the Highlands, I do not believe that it has any future except as a continual drain on the taxpayer. I am a sheep farmer and it goes against me to say that, but I really believe it to be the economic truth.

I would far rather see the Board concentrate on improving the better, lower lying land for the rearing of cattle, but here again one must be practical. At great expense you can drain the peat bogs and re-seed them, and you may be able to grow quite a decent crop of Timothy hay, for instance. But I doubt whether it would be economical. It would be more economical, from the nation's point of view, to give the Highlands cattle farmers far higher subsidies to offset the cost of their winter keep, and perhaps double or even treble their stock of cattle. To drain peat bogs to grow hay means an enormous capital expense without sufficient return.

I wholeheartedly support the Board about helping horticulture in the Highlands. With the great growth in the tourist trade this has a sound future in the Highlands. It is absurd how very difficult it is to-day to get a lettuce there. After all, the Highlands, particularly the Western Highlands, can grow the finest soft fruit in Britain. Perhaps, also, there could even be intensive poultry farming in certain high tourist areas. Another activity of the Board, where it is really on the right beam, is bulb growing. I know of one or two farms in East Kent which grow bulbs. It is highly profitable and the land is extremely valuable. I would draw attention to the Valley Strand project in North Uist which I believe has a great future. It is perfectly all right to spend £1,000, £2,000 or perhaps even more an acre reclaiming land for bulb growing. I have seen Valley Strand and it is eminently suitable and is an activity project which really makes economic sense. I wish it every success. That is far better than reclaiming a peat hog to grow hay which will have a negligible economic return.

I am a little worried about whether the local labour will co-operate. I have known projects to be started in the West which have had to employ outside labour. The island labour is very independent and does not like being disciplined and working to a stop-watch. There is a story which my grandfather told me and which I believe I told in this House three or four years ago. When Lord Leverhulme was spending a fortune in the Outer Hebrides, the local people would not co-operate with him. My grandfather, who was then the Member of Parliament for Argyll, was asked to go up there to reason with them, and he said that the reason why they did not want to co-operate was that they did not wish to go to a factory when a whistle blew. They wanted to work when they felt like it. Old customs die hard and there is still that custom in the West. But perhaps I am only putting out a red herring.

For the last two years I have been corresponding with the Bluepoint Oyster Corporation of America in Long Island, New York, to try to get them to take an interest in fish farming in Mull. They sent over a very high-powered representative for two or three visits and he came to the conclusion that, biologically, it was perfectly possible and made good sense. But there was one thing which worried him. He said that the local people had a "crofter" attitude, and I suppose he meant that they are not always too keen on work when there has to be strict discipline.

Paragraph 188 of the Report deals with an old subject of mine—venison. I am glad that the Board has come round to my way of thinking and agrees that there is probably a future in farming deer. But I am surprised that the Report mentioned only the high price of venison and did not refer to the large sums of money which foreign sportsmen will pay to shoot a stag. No one is going to pay to shoot a black-faced ewe, but some of these Dutchmen and Germans—not so much the Americans, because they are not so keen on walking—will pay £400 or £500 if they can shoot a decent stag. It is quite fantastic. Paragraph 188 states that the Rowett Research Institute is doubtful whether farming of deer could be done economically, but it has not taken into account the sportsmen; it has apparently based its figures on the price of venison. But even taking only the price of venison, I received 4s. a pound, all transport paid, this year for my venison, which is a lot more than I got for my mutton. I also had people pay me to shoot some of it; and you will not get anyone to pay you to shoot or skin a sheep. So I would impress upon the Board that there is a great future for red deer in the great rough, wild hills of the West. The Board is coming round to the idea gradually, but it still needs a lot of prodding. That is the only part of the world where you can stalk the indigenous red deer in his natural surroundings in the open. That is very much sought after by foreign sportsmen. It also takes place among the finest scenery in the world.

I know plenty of hill farms—I have them myself—which have a stocking rate of only one ewe to six, seven, eight or even ten acres. They have a lambing percentage of not more than 60 per cent. It is completely uneconomic. It would be vastly more profitable for the country to clear the sheep off and to give the land over to deer. But there is one great difficulty in implementing this policy, and that is where you have tenant sheep farmers. It is very difficult then, because you cannot turn them off. I was wondering whether, in such cases, the Highlanders' own Board could, along with the landowner, provide money to compensate the tenant for taking his sheep off the hill, and then help the tenant to branch out into some other farming activity—perhaps more intensive beef farming. He could stay on the farm, but we want to get the sheep off these sub-marginal hills. He could do more intensive beef farming; or, provided there is a big tourist trade in the vicinity, he could do pony trekking. Or he could go into horticulture. There are all sorts of things he could do.

I should like to compliment the Board on being the Fairy Godmother that it has been to the island I am interested in—Mull. Because, not counting the new hotel at Craigmoor, which I think is costing about £300,000, according to the Report, it has provided, in small grants, £160,000 to individuals in the island; and it estimates that that has created 80 new jobs. That is fair enough. If you spend a capital of £2,000 to create a job for somebody, I think that is reasonable. But there have been one or two instances—I am now talking of the island—where the money has been wasted. The Board must be very careful whom it gives the money to, because if you suddenly hand a man who has never had money before a free grant of £5,000, you may drive him to drink. He gets so elated that he goes totally mad; and the Board needs to be very careful to whom it hands large sums of money.

The other thing in which the Board has been of very great assistance in Mull is in its help to co-operative market associations and in this way improving the standard of calves. Any scheme devised to improve the marketing of livestock in the Islands deserves support because what happens is that the Island farmers send their stock to the mainland market, and the mainland dealers know well that the Island farmers cannot easily take their stock home. Therefore, if there is a surplus in the market, with a lot of cattle in, the dealers get the better of the farmers, who may receive very depressed prices. The dealers take advantage of their geographical situation.

Before I end (and I am going to end in five minutes) may I say that there is one thing that I am surprised is not mentioned in the Report? Perhaps it has been mentioned in a paragraph, but it has not been referred to in this debate, I think. That is the question of minerals. I am rather fortunate in that my estate is reckoned to be one of the most interesting geological parts of the world. We get geologists from all over the world coming there, of every nationality; and we get dozens of students. We also get a lot of other people tapping the rocks and making surveys, and I am very pleased to see them there, provided they do not do it too much in the stalking season, in September. I have mineral rights in Ireland. The situation is typically Irish: I do not own the land but I have the mineral rights. Ireland has been very go-ahead in this respect. She has attracted millions of dollars from abroad, from America and Canada, to exploit the minerals in Ireland; and she has done it by very great tax concessions. I am quite sure there are far more minerals in the Highlands than in Ireland: I am quite sure we are absolutely stacked with them. I happen to know that I have minerals. I also have sapphires—they are not first-class, and I am not telling you where they are; but they are quite good enough.

There are two things which have inhibited landowners who think they have minerals from exploiting them. The first is the tax position. They know that if they mine their minerals the money received will all go in tax; they will be lucky if they see a shilling out of it. The other thing that inhibits some landowners—not all, of course—is that they are frightened of spoiling the beauty of the scenery. And there they are quite right. It is not mentioned in this Report, but we have recently had certain fiscal changes which now make it more conducive to landowners and mining companies to exploit the minerals of the Highlands. Now you can have your royalties, divided as to 50 per cent. capital and 50 per cent. income. That is very helpful, I agree; but this does not compare with other countries. For instance, in South Africa you can have all your capital expenditure back before you pay any tax; and I understand that in the South of Ireland now you do not have to pay any tax for twenty years. That is rather over-generous I must say, but it must be very attractive to foreign companies.

LORD BALERNO

My Lords, may I interrupt the noble Viscount for a moment? Before he leaves the subject, may I ask him whether he has heard of Dr. R. H. S. Robertson, who is employed by the Board and is making this survey? Dr. Robertson has an international reputation, and he is employed searching for minerals all over the world. I think that we could not be better placed than with the arrangements which the Board are making on this score; and if minerals workable at an economic rate can be found, they will be found.

VISCOUNT MASSEREENE AND FERRARD

No, my Lords. I have actually corresponded with his department, and I know this very well. I do not wish to argue with the noble Lord, but I do not agree with him. You can certainly have surveys—and they have done a geological survey of my estate—but that is not good enough. It is only a survey of the surface soil. You cannot tell in chat way what is 2,000 or 3,000 feet down. The only way you can do that is by hardrock mining. You have to drill down with a diamond drill. You have to go down 3,000 or 4,000 feet, and it costs £2 a foot. It is very expensive.

You will not find these minerals through Boards or through civil servants or through students. I agree that it is useful for the students. They write hundreds of theses on my estate. I get many professors there; but they are not going to find minerals. If you want to find minerals you must look to the businessmen, to the big concerns, to the private individuals—and before you do that you must get your tax structure right. Providing you get your tax structure right, then I am sure that minerals in the Highlands will become the most job-attracting industry of all. For it must be remembered that for every man down the mine there are probably four or five, such as shopkeepers and the like, above.

My Lords, I must not speak any longer; but the noble Lord rather "asked for it", I am afraid. I am sorry if I have been a little hasty with him. But I should like to end by complimenting the Board I think that one or two noble Lords rather criticised them. They have a very difficult job. I know the Western Islands—the people are not all that easy. The Board have a very difficult job and on the whole I think they are doing pretty well.

6.31 p.m.

LORD TAYLOR OF GRYFE

My Lords, in the course of this debate there have been several references to forestry. I should explain that I shall not be tempted to discuss this subject because of the Rules of your Lordships' House which properly provide that the Minister responsible for forestry deals with forestry matters; but I felt that I should make this explanation because several noble Lords have been good enough to refer to the subject and to me personally.

I should assure your Lordships, however, that my interest and involvement in the Highlands is not exclusively concerned with forestry matters. Until fairly recently I was the Chairman of a large Scottish-owned organisation which is responsible for a good deal of distribution in the Highlands. I have a continuing interest in distribution in the Highlands and Islands and for that reason I welcomed the statement by the noble Baroness in connection with selective employment tax—because I have watched over the years a steady deterioration in distribution in the Highlands and a constant withdrawal of services to remote villages and remote communities because it is no longer possible for any commercial concern to send their shopping vans up the glens or to maintain shops in the small Highland villages.

The deterioration in distribution, the withdrawal of such services, makes it more and more difficult to get people to work in these remote areas, so for that reason I was delighted to hear the affirmation of the promise that selective employment tax would be withdrawn at the appropriate time. I do not minimise the difficulties of withdrawing this tax, which is a high revenue earner, but the intention at least is right and I am sure that in the Highlands it is much welcomed. I observe that the number of people employed in the Highlands in industry is only 12 per cent.; the balance are in various other services, so that the actual withdrawal of the regional employment premium at a later stage which is also indicated will not seriously affect the Highlands and the withdrawal of the selective employment tax is much more important in the context of the Highland economy.

The noble Viscount, Lord Thurso, invited us to go back to the beginnings so far as the Board is concerned. It may be that if we go back to the beginnings we might consider that four years is too short a period to assess the work and significance of the Highlands Board. But when preparing for this debate I went back to October, 1964, to the Report on Land Use which was prepared, as noble Lords may recall, by the Advisory Panel on the Highlands and Islands. They said: Because of its history and its different culture and tradition, this part of Scotland evokes strong emotional reactions. To some the Highlands and the Highlanders are no more than a wild periphery, ever depending on the benefits and bounty of the South and ever trailing behind in the advancing standard of living. To others, again, the more glaring hardships of the clearances have left a guilty need for some kind of restitution. Whatever the emotion may be, in dealing with this question there has been evidence of the deep concern of this House about the future of the Highlands. The Report goes on later to say: What have the Highlands to offer? Land; minerals; fish life, sea and river; natural wild animals for food … landscapes of infinite variety and beauty; space for recreation and health. … In brief a variety of material benefits and services which this country requires. I think it was understanding that need which caused us to establish the Highlands and Islands Development Board. At that time it was noted that there were something like thirty Government agencies involved in social and economic affairs concerning the Highlands.

The purpose of setting up the Board was to create one co-ordinating body which could encourage and stimulate and be the catalyst for Highland development. Although four years is a comparatively short period to assess the work of the Board, the indications are favourable and I think it could be said modestly by the Board that at least they have created some hope for the future of the Highlands. I think that some of the sponsors of the Board in the early stages expected too much from the Board, and perhaps it was this feeling that we must do something quickly that encouraged the Board to undertake certain developments at which they might have had a closer look. Nevertheless, the Board has been a coordinating body and a body to stimulate industrial and other developments.

I think, too, that the Board has settled down in the procedural sense. Inevitably when you create a new Board you see how it fits into the general pattern of Government and Government organisation. I was interested in the reference of the noble Lord, Lord Hoy, to the inhibitions and restrictions on the Board. I, too, read the Select Committee on Scottish Affairs Report, in fact last night. In reply to a question, Sir Robert Grieve said: I should like to say that we cannot really grumble about the inhibitions by the Scottish Office or the £50,000, which is the limit within which they operate. So I feel that the Board is now settled down to a pattern in which it can be effective.

I had the good fortune at the week-end to talk to the retired Chairman of the Highland and Islands Development Board. He now teaches in Glasgow University and can look at the performance of the Board with perhaps a greater degree of objectivity than he did, say, six months ago. I was impressed by the general philosophy of Sir Robert Grieve. First of all, he said that in setting up the Board they did not create a Highland plan, some great plan that people could be inspired by. He said that Highlanders have suffered enough from promises unfulfilled and so the creation of some great Highland Plan might have encouraged feelings among Highlanders that something highly dramatic was about to take place. They contented themselves in the first year of the Board—this is included in the first Annual Report of the Board—by developing a strategy which said that the schemes which will be undertaken will be a succession of small developments; and secondly, that there will be an emphasis on fishery development and also on tourism. I think that basic strategy is now beginning to be fulfilled by the Board.

The Moray Firth Development is in a rather special category. It is a kind of status symbol in the Highlands—proof that the Highlands are not so remote as some people think, and that such a development is possible. But it does not come within the general range of the kind of undertakings which will concern the Highlands and Islands Development Board. In looking through the Report of the Select Committee on Scottish Affairs I came across another interesting exchange. This, I think, indicates the right attitude to Highland development. One somewhat disillusioned Member of Parliament, who is not a Highland Member, said to Sir Robert in the Question and Answer session: Would you agree that projects should be carried out in the Highlands irrespective of their viability? The answer was, "No." The Member said: It is only existing by public subsidy; that is what it really means. I really meant to say that. Sir Robert replied: No. What we have in mind for the Highlands is a progressively more viable Highlands. That must of course mean that the work done in the Highlands should become more commercially viable. My Lords, I feel very strongly that we should not be looking forward to a continuation of the Highlands Board as being an organisation which will simply dispense public money indefinitely. The Highlanders are essentially a proud people and all Scots, I feel, share that trait. It is of no satisfaction to any people to feel that they are on the receiving end of a continuing subsidy. So the general philosophy of the Highlands Board and the new Board must be to encourage hope in the Highlands and to involve the Highland people in their own salvation; to work with people so that they may feel that they are contributing to their own economic and social salvation. I hope that that attitude will be continued by the new Board.

Inevitably the future of the Highlands will be affected by the regional policies of the Government, and the Government have changed the emphasis on incentives to industry and economic development in Scotland in general. It is too early to say whether the system of blanket overall investment grants is preferable in growth terms to the selectivity of the new system, and it may be that there will be a period of adjustment before we get that growth. But this affects the Scottish economy generally, rather than just the Highlands. For the new Chairman and for the new Board, to-day's debate must be a source of great encouragement. I was delighted to hear the continuing commitment of the Government so far as the Board is concerned, and I was delighted to listen to the many speeches in favour of the general work of the Board. There is a great deal to be done.

I believe that a lot of money can be spent uselessly on publicity, and I think it necessary that you should pinpoint what you are aiming at in any publicity campaign. If I may say so, I am now in possession of at least six copies of a very beautifully illustrated brochure, copies of which appear in my sleeper every night when I come from Glasgow down to London. It has made a profound impression on me; I have taken them to some of my friends in other walks of life and I am sure that the brochure is an excellent example of first-class printing and presentation. But I think it would be wise if the Board concerned itself with directing publicity in the areas where it is most likely to be productive. I hope that the Board will not mind my offering this minor criticism.

I would say, too, that the Board might be interested in an excellent publication from the Scottish Council (Development of Industry), which will shortly be printed, concerning the food industry in Scotland. Like many publications from this body, it is extremely useful, helpful and encouraging. This particular study which was undertaken by the Council insists that there are substantial opportunities in Scotland for the continued development of food processing industry based on naturally occurring raw materials. It goes into great detail as to these potentialities; and many of these possibilities exist in the Highlands of making use of natural resources which are available.

I would say, too, that in the light of the development of tourism and what is now commonly called the recreational explosion, the Highlands seem to be set fair. I am impressed when, like the noble Baroness, occasionally I visit the areas which I love and for which I have some responsibility. How wonderful it is now to go up through the glens and see the young people; not simply the development of first-class hotels at Aviemore which are important and making an excellent contribution to tourist development, but to see young people realising for the first time how important it is to have access to the hills and to the mountains and the ski slopes; and to see life beginning again in these areas because young people are growing a little tired of the grey staleness of city life and are finding it necessary for a full and a balanced life that they should enjoy the excitement and the adventure of the hills and the mountains. And so the Highlands and Islands Development Board can help this recreation explosion by catering not only for the more affluent tourist but also for the young people who are seeking such outlets in walking and climbing.

One final point. While we may become slightly obsessed at times with developments and fascinated by the number of jobs created and with this and that industrial scheme, I hope that the Board, in pursuit of industrial development, small-scale and large-scale, will remember their substantial amenity responsibility so far as the Highlands are concerned. It is important that the Highlands be not spoiled. This does not mean that people should be prohibited from going there. They will be encouraged to go there by the very fact that the country is beautiful, and I hope that it may remain so.

6.40 p.m.

THE EARL OF LAUDERDALE

My Lords, to Lord Taylor of Gryfe's reference to raw materials I shall be returning. But first I must say that we are greatly indebted to the noble Earl, Lord Perth, for once again initiating a Scottish debate. We must also congratulate ourselves on having at least got the much-feeling Lord Rankeillour on to his feet for a maiden speech which we have, I think, all shared in the agony of producing. It was delivered with real feeling; it included a happy choice of words and it was embellished with some merry strictures upon officialdom.

One of the pleasures of a Scottish debate is that it reminds one of the line in Macaulay's Horatius: Then none was for party, Then all were for the State. In a Scottish debate we are singularly united, and to-day, in particular, in congratulating Sir Andrew Gilchrist on his appointment and wishing him well. I have a certain interest in this (which may come as a surprise to him), in that his brother, known as Gilchrist of the Kerse, near Lesmahagow, was for many years a constituent of mine and a very faithful friend and supporter.

I suspect that I am not alone in detecting a new whiff and new sense and mood in the tone of the Board's attitude to their problems, shown by the article which Sir Andrew contributed to the Scotsman and which many of us read with much interest yesterday. There would seem to be some sign at last of turning back from this preoccupation with helping many tiny and uncertain projects, significant as they may be, towards larger strategic horizons, larger strategic purposes. Sir Andrew wrote: We need to keep in step with the modernisation of the means of transport". Further on he added: The time has come for us to assume the impact of the conditions"— that is of Europe— as a given fact … It is those two points in that article which I believe show a forward view to which I draw attention.

My Lords, in the last two years we have had strategic studies of almost every part of Scotland. There has been the study of Tayside to see how an imaginary 300,000 people could be lodged there, when the drift from Scotland continues as fast as ever. We have had the Gaskin Study on the North East; we have had a study on the South West, and indeed we have had the subject of our last Scottish debate, which was the "Oceanspan" Report by the Scottish Council. I begin by asking why cannot we have a strategic study of the growth point potential in the Highlands in the light of the points mentioned by Sir Andrew in his article: the modernisation of the means of transport, and the impact upon our economic geography of the foreshortening of communications with Europe? In line with the preferences of the noble Baroness, Lady Tweedsmuir, and the noble Earl, Lord Perth, that industries should be based on natural resources, I believe that such a strategic study—not just a drilling penetration for minerals, important as that may be in itself—should regard our natural resources in the very widest sense.

The first aspect of these that we should look at is our communications. On the road/rail pattern I draw the attention of your Lordships to a document called Fact Sheets on Britain, published by the Central Office of Information for British information services overseas (reference FSB E/9, of October, 1970), on railways. The map on the back shows no railway passenger route North of Glasgow, and no railway passenger route either West or North of Inverness. If that is accurate, let the Government confirm it; if it is inaccurate, let the Government put it right—because this is not the kind of information to send abroad to British information services describing our natural resources in terms of communications. Does this mean that the Glasgow/Fort William/Mallaig line and the Inverness/Wick/Thurso line are doomed, as well as the line to the West? I believe that there is a strong socio-strategic case for keeping these lines open: and I shall come back to this.

Then, my Lords, there is the natural resource that we have in terms of roads, or places where roads could be built. If one looks at the pattern of roads intended for the 'seventies, one sees the A.9, with a thick dotted line, heading North; but one sees no West-East communication whatsoever. Yet with oil under the North Sea off Aberdeen, surely Aberdeen is a growth point of the future. And with Fort William already blessed with a pulpmill and British Aluminium, surely that, too, is a growth point. There is no scheme to link the two, West and East. Bluntly, my Lords, what this means is opening up the route through Glen Feshie, between Kingcraif and Braemar, to join the A.9 to the A.93. It lacks only a dozen miles, and the locals have been clamouring for this for years.

But, my Lords, beware of Goethe's "Der Geist der stets verneint": the spirit that always denies! Beware the spirit that tends to deny within the Scottish office! It is no use talking about cost-benefit analysis of a road that is not there. It is no use trying to hide behind a lack of demand for a road that is not there. It is a question of the potential of growth at the two ends of this route which could be served by a crossway from West to East, and it is a question of recognising that this would be a developmental investment to generate growth. It should be considered in that way.

The next aspect of a strategic appreciation of our national resources is the Caldonian Canal. Its relevance is now renewed, one might say upgraded, by the new technologies of sea transport which offer a quite new opportunity. Barges now exist, and have been proved on the open sea on the West Coast of America, which can sail in fairly high seas and certainly on their known performance could be towed across the North Sea. Secondly, there are new kinds of ships, notably the LASH and the See-Bee, which carry barges on board, themselves loaded with goods, and which disgorge these at strategic points and send them to their destination up the narrow waterways and river-ways of the world. Two such ships already ply the Atlantic between the mouth of the Mississippi and the North Sea and the Mediterranean. Central Gulf lines of New Orleans, who are running these two LASH ships, have a terminal in the Medway. They were seeking another terminal in Britain and looked at the Humber. They wanted a mooring buoy for a 40,000 ton ship with a swinging circle of one-third of a mile.

I ask the noble Baroness to ask her advisers, and perhaps write to me later if she cannot get the answer at once: Did the Highlands and Islands Board, did the Scottish Office, did British Waterways, get on to this possibility with a view to getting a berth, a mooring buoy, for one of these LASH ships either in Loch Aber or Loch Linnhe? Barges of the draught and size concerned could go through the Caledonian Canal perfectly happily two at a time with a tug. Although the capital cost of such a mooring buoy would be £80,000, more or less, and its service and maintenance might be £25,000 a year, here is something of a technical character which could enhance our natural resources if the authorities would look at it.

It is not as if these two LASH ships are the last of their kind. More are on the way. The Holland-America line are planning a LASH ship for their Rhine Mississippi service. The Hapag-Lloyd line are doing the same for their service to the Great Lakes. Lykes Lines of New Orleans have three barge-carrying See-Bee ships on order for delivery at the end of this year or early in 1972. They may all be in the market for a British terminal which will link them by waterway to the heart of Europe. May I say that the water journey across the North Sea and into the Baltic takes you right to the heart of Russia down in the Caspian, so that it opens up a tremendous route of great significance for a new transport technology we could use to revive the Caledonian Canal and the Great Glen.

I believe that strategic studies of our natural resources should inquire what industries could be interested in the Great Glen, whether at Fort William, Fort Augustus or Inverness, with the prospect of easy barge transport either way for raw materials inwards and processed materials outwards. Could this be of interest either to British Aluminium or to Wiggins Teape? Could aluminium from the Cromarty Firth be barged down through the Caledonian Canal so that aluminium fabrication could be started up on the West coast? There are other natural resources that are worthy of study.

LORD HUGHES

My Lords, may I interrupt the noble Earl? What he is saying is intensely interesting, but I do not think all of us are as knowledgeable as he is on the subject. Would he perhaps explain a little what a LASH ship is?

THE EARL OF LAUDERDALE

My Lords, I am much obliged; I apologise. The LASH ship is a ship of about 40,000 or 50,000 tons, which carries its cargo stowed in barges on board, and on reaching a suitable destination the barges are disgorged and find their way to their destination, not from a big harbour, but up riverways or narrower waterways. The existence of the Caledonian Canal, offering a route to the North Sea and the Baltic—to say nothing of the Rhine—is, it seems to me, in this connection a natural source of great significance, in view of the development of the LASH ship and the parallel development of the See-Bee, which is not greatly different in its essentials.

Other natural resources worthy of study in a strategic context would include the geographic opportunities of the Kylesku Gorge on the West coast. A barrage crossing Kylesku, providing a route in place of the ferry, might be of considerable hydro-electric interest, in that engineering studies are now proceeding which seem to suggest that it is possible to generate electricity by tidal hydro power, not subject to the cycle of tides but on a continuous pattern. That is something the strategic study could look at.

Then there is the question of Dounreay. May I thank the noble Baroness, Lady Tweedsmuir, for one very long and interesting letter about this matter which I received from her the other day, following an earlier letter which was less informative. I am bound to say that the very fact that the points I made on this subject in the Oceanspan Debate in July were so misunderstood in her office and SO incorrectly answered the first time that it took her office, and other offices, three months to prepare a reply to my restatement of the points about the future of Dounreay, suggests that the H.I.D.B. and the Scottish Office do not seem to have in their fabric the kind of study personnel who are as au fait as one would wish.

The simple facts about Dounreay remain. The technical college at Thurso is "rarin' to go"; Dounreay is now admitted to have facilities for certain sorts of undergraduate training. So if Dounreay is run down, surely there is a case for using these facilities. Ormlie Lodge, Thurso, has 200 beds which will soon be vacant, so there are the residential facilities and the technical facilities all within a few miles. Surely this is the nucleus of a small but promising scientific higher educational establishment whose development could put some of our country's heavy capital investment in Caithness to further long-term use. It really is no answer, may I say with respect, to write that there is no demand for such an establishment at Thurso, when technical colleges all over Britain are bursting at the seams, and those who cannot get in have to fall back on the Open University. This argument does not stand.

My Lords, such are some of the strategic ideas relating to our natural resources which I believe deserve a careful study. I should like to end by endorsing Lord Thurso's critical point about the Highlands Board. It should be the extra body, the planning body, the catalyst; and I say to it, "Good fortune !" Under Sir Andrew Gilchrist I feel sure we can picture the words coming true: Forward and frolic glee was there, The will to do, the soul to dare".

6.55 p.m.

LORD LOVAT

My Lords, it is bad enough to come seventeenth in the batting order, but even worse when the speech you have prepared is delivered by the previous speaker. This is very much what has happened in my case, because I feel that the whole Highland economy, to be put on a viable basis with the South, must be geared up to a better transport system. One cannot say that often enough. It has been hinted at by speakers here to-night, but it has been talked about ever since I succeeded my father in this House; and that was 40 years ago. It has been the subject of every kind of Committee. The Cairncross Report, the Toothill Report, and others, all emphasised that we have to speed up our communications to survive in the Highlands. I firmly believe that this is half the answer to all the Board's problems here. The problems are numerous and manifest. I am not going to dwell on the past; I have been a critic of the Board. I welcome Sir Andrew with all my heart, and the Board has stood up to a great many insuperable tasks which were not envisaged at the lime of its formation. S.E.T. is the worst example.

The Transport Act has been a disaster in the inner areas of the North. The vans which used to supply the outback are no longer able to take the road; and if you are a farmer, as I am, it is a physical impossibility to get a cattle float to go to market. If there are only so many available, you have to take your turn; and you will be lucky to draw a float on the day you require it. It is the same with fertilisers, lime and all the rest. This was a terrible knock to the Highlands, but the Board have stuck it out in some way or other. The reduction in the Territorial Army—a subject which has not been referred to to-night—was also a severe blow to the Highlands. The drill hall in the village was the focal point of the community, and on every big estate young men stayed on simply to go to camp in their fortnight's holiday. But now they are drifting away. And this has happened since the Territorial Army was put on the scrapheap. We have suffered the same fate in the Highlands as the Gurkhas have in Nepal. I put it as strongly as that. This has meant a severe loss to the community, and a resulting depopulation. Whatever the noble Lord, Lord Hughes, said at the beginning of this debate, the landward area of the Highlands is still being depopulated, and the time has come when we must stop that state of affairs or we shall have failed in our duty as Highlanders and the Board also will have failed.

I hope the Board will forgive me for mentioning one matter with regard to communications—and this is possibly a reason why I quarrelled with Sir Robert Grieve. They are entirely wrong to disregard the value of land, in the sense of arable land. In the county of Inverness, the biggest county in Great Britain, rather less than 6 per cent. of the land is arable, yet not so long ago all the talk was of a linear city on the very arable land which should at all costs be preserved. I have accused Sir Robert of being an urban planner, and his planners of the Jack Holmes group of suffering from possibly the same problem. I hope that I do neither of them an injustice. If we want to speed up communications it would be far better to continue the route over the Forth Road Bridge, the Tay Road Bridge, with bridges across the Narrows of Kessock and across the Cromarty Firth, and the Meikle Ferry to link up with the North. This must be sense, for it means a difference of hours on the road.

The Black Isle, the most fertile part of Easter Ross, has something like 38,000 arable acres. That is far more than in Inverness-shire, but one has to make a journey of 25 miles to get to the market. This cannot be sense, but until very recently, I am sorry to say, it was the Board's policy: that producers should go the long way round, by Beauly and through the middle of Inverness. This cannot make sense at any level of planning; and I respectfully suggest that a linear city (or a "string of pearls", as it has since been described), with communities of 15,000 people who do not appear to have any chance of employment, is fanciful to a degree. It is a difficult point to distinguish where credulity ends and feasibility is proved utterly absurd. I hope that the noble Baroness on the Front Bench, in deciding the future of the A.9, will make it North and not the longest way round, where primordial man would have walked on his knuckles. This is something that I hope the Board will bear in mind.

I have only one more point to make, my Lords, and it is on the subject of agriculture. Of course there are different forms of agriculture. The Government must very soon tell us in the Highlands what the future for hill farming holds. I can assure the noble Baroness that we are at the crossroads in hill farming—and I speak with a certain authority on this subject, having been a pioneer of hill farming ever since I left the Army. We simply could not run cattle or sheep on the Highland hills to-day without subsidies. If this country goes into the Common Market, do we or do we not get those subsidies? Because without them a Highlands problem will very quickly be thrown on to the Board and on to the Government. We should hold these subsidies because the Highland hills are a reservoir for store cattle and sheep that can be fattened on the Lowlands; and the rise in the standard of living makes beef and mutton more important than they were in former days—we cannot have enough of them—and it is a form of livelihood that has a peculiar attraction to the Highlander and one for which he has great aptitude.

I do not think hill sheep are paying, even with subsidies; but more can be done with cattle. Perhaps if it is too much for the Board to consider this, the Government should think very much more closely of land reclamation from the sea. This is a well-worn theme on my part: I have made many speeches on this subject. But it can be done. There is no question about it. Taking the road the long way round the Beauly Firth is destroying something like 11,000 acres of arable land quite unnecessarily by driving a dual-carriageway through the best farms of a very limited coastal fringe of country. But there are something like 9,000 acres of the best alluvial soil in the Beauly and Cromarty Firths that have been washed down through the course of time over which the sea floods to a depth of only five or six feet. The Dutch, indeed, would have reclaimed these acres hundreds of years ago. The best farms on the estates that I know well were all won from the sea, when all one's forebears had was a spirit level and a spade.

I feel that the Board should give more thought to this matter; or, if it is too big a job for them, that Her Majesty's Government should take the matter up very seriously. As your Lordships well know, the town of Rotterdam is pumped entirely out of the sea, and sand has been the foundation of that very great ocean terminal. I believe that mistakes have been made, even in the Invergordon area, of taking the best arable land when other sources might have been made better use of. I hope that the Government will bear this in mind, even if it is too heavy a commitment for the Highlands and Islands Board. My last request, my Lords—and I make it with all sincerity and from the bottom of my heart—is that it is high time we had a Highland University. The Highland Capital, Inverness, is the obvious place to put it, and this would give the Board a very great boost.

7.4 p.m.

LORD BURTON

My Lords, I should like to start by adding my congratulations to my noble friend Lord Rankeillour; my thanks to the noble Earl for introducing the debate; and also my thanks to my noble friend the Duke of Atholl for his advice on a strategic position from which to speak, for if I can deliver half as powerful a speech as he did I shall be more than thankful. Some months ago I found the B.B.C. on the telephone wanting to know whether I could help them with a programme which they said they were doing on "The Highland Problem". I promptly asked them: Which one? After a most enjoyable dinner with the producer and the cameraman, I think perhaps it may have come to light that there are many Highland problems, and no one specific one. However, I have always maintained—and indeed this has been reinforced by many speakers to-day, particularly by my noble friend Lord Lovat—that the greatest problem is transport, and the difficulty of getting people and goods from one part of our scattered area to another. It used to be said that if you gave the Highlands decent roads you would let the people out and they would never return; but I hope that this fallacy has been banished for ever.

I think the last time there was any considerable discussion in this House on the Highland. Development Board was during a debate on the economy of Scotland some eighteen months ago. At that time, as to-day, the need for the major improvement of A.9, the Perth-Inverness road, was thumped home. I am quite confident that this is still the key to all Highland development, and I believe that a realisation of this fact is slowly dawning on the powers-that-be, for it seems that one of the first things this Government have done is to institute a survey of this road—not that we have not had a good many surveys already. We are hoping that, before very long, this action will be followed by reconstruction of this road.

Unfortunately, I fear that there is still thinking in St. Andrew's House that the criterion for spending money on a road is the existing traffic density. It was to be hoped that the Highland Development Board would dispel this thinking and point out the urgent necessity of getting our infrastructure right as an essential criterion to any development of the North. Alas, it appears that so far—I emphasise "so far", because we have hopes of the new Board—the Board have been mesmerised by the prospects of a second Clyde Valley in the Moray Firth area; and, apart from the Ullapool ferry (of which I should like to make more mention in a minute) they appear to have been completely unable to look at transport as a whole.

Take the second Report, done by the Jack Holmes Group, on the road North from Inverness. Nowhere in this Report can I find any mention of Caithness or Sutherland—a very large proportion of the Board's area—which appears to have been completely ignored in the calculations in this very voluminous Report we have. Again, there is a considerable flow of traffic coming up the Fort William—Inverness road, part of which goes further North, and absolutely no consideration has been given to this traffic. Transport being the key to the development of the Highlands, I intend to belabour the point, not so much for what the Board have done in this respect, but for what they have not done. They have failed to come down firmly and categorically to state that the Kyle-Inverness line should not be closed.

Indeed, as my noble friend Lord Cromartie has said, they have firmly declined publicly to state their views on the closure of this railway, but from talks which have taken place there is little doubt that they feel that, once the Ullapool-Stornoway ferry is operating, there will be no need for this line. As I think the Minister already knows, there are very mixed views on this proposed ferry. Ross and Cromarty County Council were divided when it was discussed, and indeed if one were to look at the Stornoway Gazette of a fortnight ago one would find that even Stornoway has woken up to the fact that such a ferry would be highly injurious to them. Inverness County Council have never been consulted as to their views, and I know that they would come down unanimously against such a ferry as it would probably be very damaging to transport facilities in the Inverness-shire islands.

It is, therefore, with bitter disappointment in many quarters that the announcement was received from the Secretary of State to go ahead with this project. He was roundly condemned in at least one of our local papers; and, in view of the many transport projects requiring finance, it seems a pity if money is to be wasted on a bad project over which there is much division. I hope that he will institute further inquiries and at least temporarily "hold his horses" on this project.

I am pleased to say that, at the present time, there appears to be excellent co-operation between the Ross and Cromarty and Inverness highway authorities. This perhaps is something new and unique between the two authorities, and may be we should thank the Highland Development Board for having been partly responsible, for having driven us into this position to defend ourselves against the advice which is being given by the Board on transport to the Secretary of State.

There is grave concern at the manner in which our transport system, particularly on the Western seaboard, is being looked at in a piecemeal fashion, and with little or no consultation with the local authorities. I was delighted to hear my noble friend Lord Strathcona reinforce my view that for the past number of years considerable sums of money have been wasted on piers which are no longer suitable for the type of boats that are using them.

Take another instance, the three West Coast rail terminals—Kyle, Mallaig and Oban. It appears that we are to have each railway dealt with individually, and it is believed to be the view of the Highlands and Islands Development Board that closure of the Mallaig line should be strongly resisted, but I am convinced that there is a far better case for the Kyle line than the Mallaig line. However, I must not launch forth into this or I would keep your Lordships far too long, but it is a matter of very grave concern in the Highlands.

We are getting a new bridge at Ballachulish, but although we are grateful for this, had our county council been consulted I think there is little doubt that we would have opted for a bridge at Kyle first. A bridge at Kyle would affect not only Skye but all the Ross-shire, and practically all the Inverness-shire islands as well. There are so many changes mooted for transport on our Western seaboard that the Inverness-shire Roads Committee last week unanimously agreed that it would be an excellent plan if the County Councils of Ross and Cromarty and Argyll and Inverness could get together to see how best the Western seaboard transport system could be planned.

Will the Secretary of State please listen to our joint representations before he goes ahead irrevocably with large changes in our transport system? We may be told that the transport group are doing this, but the transport group do not deal with railways, and if they are dealing comprehensively with our transport then we do not know what they are doing except that they plan to close many bus services—this also was published last week—unless the county councils are prepared to subsidise them through the rates. This method of subsidy was one of the many iniquities introduced by the previous Administration. The group would, anyway, be for the most part bus operators, and all we appear to get from bus companies are spiralling fares and diminishing services. Further, the noble Lord, Lord Strathcona, has amply displayed our views on the questionability of the efficiency of the transport group.

What is the Development Board doing about all this? We should like to know. Perhaps the three local authorities as a unified body may be treated with more respect over transport than we have been as individual authorities. I think perhaps the transport group were unlucky with the new Kyle ferry, but if this is to be an example of their ventures into sea transport, then the Board had better look to see how best the islands can be evacuated in a few years. For instance, however unlucky they were over the Kyle boat, they cannot be excused for installing upon it ramps which are now tearing the piers to pieces.

From the figures it would appear that our next biggest problem is unemployment. The Highlands always appear to have higher unemployment figures than elsewhere. There is no doubt that new jobs have been produced in the Highland area in recent years, and the noble Lord, Lord Hughes, gave some details of these. I would be churlish if I did not give the Board some credit for what they have done. On the other hand, the population continues to dwindle. The Board state that they have 7,000 people on their books for exercise "Counterdrift", but when one applies to them for an employee of almost any description, be it for an office worker, a mechanic, a saw-miller, a forester, a tractor driver, or a cattleman—you name it—they have not got one on their list. I do not think the Board have been able to produce a single suitable applicant for any of the many vacancies which we have offered. It seems that of the 7,000 names on the list, only 30 have been found jobs.

However, the new jobs which the Board have established have inevitably drawn away employees from the existing established industries, putting the existing industries in an increasingly difficult position. If a person is given the choice of a nice comfortable job in a warm building, where even the boy brewing the tea gets a higher wage than his rural counterpart, then it is scarcely surprising that people are leaving the land where, during the last year, work has had to start outside long before daylight. If evidence of this is required, one has only to look at Appendix VII of the Report to see the alarming drop in population in the landward areas—23,000 people since 1951, or 12 per cent. of the total.

I hope that the noble Lord, Lord Taylor of Gryfe, will not think it unfair of me if I mention forestry. In this respect, I must ask the Minister to look carefully at the forestry proposals for the Highland area, for with a great flourish a few months ago the Socialist Government announced a tremendous increase in the area to be planted with trees each year. This is all very well, but who is to look after these trees? There is no point in planting them if one cannot look after them, weed them, brash them and harvest them because one has no men to do this work, nor indeed is it any use if you cannot transport the very heavy loads to wherever they are to be manufactured. The Forestry Commission have managed their labour requirements so far through mechanisation and improving techniques, so in spite of their increased acreage they have required a lesser number of employees. One does not know how long this will go on. They are making efforts to effect further improvement, but I think the problem should be looked at.

On the other hand, private estates such as ourselves, who have had to build up our staff, have found the greatest difficulty in securing employees of any calibre at all. I have been looking for three forestry foremen for nearly a year now. The same applies in agriculture. Good men stay, but if you lose someone he is extremely difficult to replace. Unfortunately, these good men grow older and some of them disappear. My drystone dyker and drainer had to stop work as a result of an accident and I have been looking for a replacement for him for nearly two years now, but without success. I cannot get one. I must therefore query the statement in the Board's Report that an increasingly ambitious programme of afforestation will maintain employment. It is very doubtful. I think possibly a change in education is what is required.

It would be wrong if I did not join with the number of your Lordships who have congratulated the Board on the success they have had in encouraging the sea fishing industry. On the other hand, I hope that the greatest care is being taken that the increased fishing will not result in "killing the goose that lays the golden egg" by over-fishing our waters. I feel that there is a very real risk of this happening. In this respect, I know there is considerable concern in the Cameron Report, which I gather recommends doing away with much of the present protection of our inshore waters. This decision seems quite inexplicable and really quite out of character with Lord Cameron, who has been so highly regarded in the Highlands in the past.

I think the concern expressed in yesterday's debate on caravans was significant and showed the need for the shake-up which has taken place in the Board. In their Report they state that they consider the development of caravan sites as being of no priority. It is, however, gratifying to see that they appreciate the need for control of "wild" camping. It will be interesting to see the results of their study of camping holidays which they have promised. Much of this work has already been done by local authorities.

Another field in which they have dabbled, I fear without much knowledge, is in the supply of venison. They were firmly but politely told at a Conference in January, 1969, at the Rowatt Research Institute, that deer farming of the type envisaged by them was most unlikely to be a viable venture. It seems, however, that they have continued to some extent to dabble in this field. The need for proper marketing of our existing supplies of venison is still a present requirement.

Mention was made to-day of Valley Strand. I will only say that I should advise great caution on this project, and I believe that the new Board will look at it very carefully. We have heard of the Board's brochure, which appears on Glasgow sleepers, but why do we not get this on our train, the Royal Highlander? On the Highland trains we do not seem to get the facilities that are provided elsewhere.

Earlier, I made mention as to how the Board had been mesmerised by the proposed development in the Moray Firth area, and I think it would be quite wrong if I did not mention the Jack Holmes reports. Both these reports are riddled with inaccuracies. They apply the most appalling land use, but I do not think I need say more because my noble friend Lord Lovat has made this point most forcibly. Indeed, the first report was so castigated in the Highlands as a whole that it was thought no further attention would be paid to it. However, to our consternation it appears that more and more attention is being paid to it by the powers that be, and the second report, on page 3, has the audacity to state: the principles of the strategy had already been accepted in general by the people in the area and by the administrating authorities. I suppose there are none so deaf as those who will not hear!

Once again the trouble appears to have been the introduction of planners from the South, who have made no attempt at local consultation. They have invariably proposed building development on the best agricultural ground, when there is ample suitable rough ground elsewhere. On my own property alone they have picked out for development the best tenanted agricultural ground. If they had taken the trouble, or had the courtesy, to come and see me, I could have offered them equally suitable and far less productive land. I must ask my noble friend if she will please ensure that these reports are buried deep in the vaults of St. Andrew's House. Or, better still, that we have a ceremonial burning of them on the forecourt of the Development Department's premises, possibly with Sir Andrew playing his pipes.

On a more serious note, I must wind up on what I feel may be a controversial point and one perhaps unpopular with the Benches opposite; but the Government are seeking methods of saving money, and what better method of doing this than saving duplication in public Departments? My noble friend on the Front Bench has told us about the Government's proposals vis-à-vis the reorganisation of local government. May I suggest that the Government look through the work of the Development Board to see how much of that work could be better executed by the existing local authorities, who presumably will be taken over by the bigger authorities in due course? Indeed, it may well be that there are other quarters in which the Board are duplicating work done by other organisations, such as, particularly, the Tourist Board. Certainly in this sector, as the noble Viscount, Lord Thurso, said, there is urgent need for simplification, and great care must be taken to reduce the "empire building" which has been taking place. May I also offer my best wishes for success to the new Board, and say that, at best, if they had not been in existence then we probably should not have had this interesting debate to-day.

7.23 p.m.

LORD FERRIER

My Lords, something that the noble Lord, Lord Taylor of Gryfe, said tempts me to say a few words in this most interesting debate, because there are one or two points, if your Lordships can believe it, which have not been made. Before I come to the matter of forestry, there is the question of tourism, which has been referred to, and the fact that the Highlands do not require many great massive hotels; they want lots of little ones. The noble Lord, Lord Lovat, has mentioned the frightful handicap that some of the sections of the Transport Act have brought about in the Highlands, and I have reason to believe that that matter is being tackled. The S.E.T. has been mentioned, and the noble Baroness has given some assurance that that is due to disappear.

But nobody has mentioned the Catering Wages Act. This is another matter which is of utmost importance to the people in the Highlands who are trying to make small hostelries pay, and I think it has been established in this debate that small hostelries are of great importance. Could the Government look into that matter? Of course, it is not a simple one. It may mean some negotiation with the employees' side. But in a short season, in a summer with daylight far into the night, when people who are taking their holidays have the time to get out late in the evening, the fact that hotels, because of the Catering Wages Act, are unable to supply the services they would like to supply, makes it essential that the matter should be dealt with.

Several references have been made to the Kyle Railway. I have mentioned it before in previous debates, since when I have reason to believe that what is wrong is the British Railways' sums. The fact is that British Railways say that they lose so much on the railway, and unless that loss is made up by grant from the Secretary of State the railway is not viable and must be closed. I should like to see the incoming Board, to whom I wish the very best of good fortune, insist on seeing a cost/benefit account of the Kyle Railway in relation to the surrounding country and the problems of Skye and the Outer Islands, and not only insist on seeing it but let it be made known to the public.

Noble Lords have only to see the small article on page 13 of to-day's Glasgow Herald to get some indication of the sense of real anxiety which exists in the countryside there at the prospect of the closing of this railway. I do not believe it is in fact an economic arrangement, because surely the whole capital cost of the main structure has been written down to one pound, or 100p, years ago. Also, I should like to know whether the Defence Department has been taken into consultation over the matter of this vital link to which the noble Lord, Lord Lovat, and others have referred. From the Kyle Railway to tourism again, what about observation cars? Surely the observation cars should not have been taken off that line and the Mallaig line. Can they be re-established as part of the provision for tourists?

Now I come to the remarks of the noble Lord, Lord Taylor of Gryfe. He concluded by saying words to the effect, "Let the Board try to keep the Highlands beautiful". This brings me back to the maiden speech of the noble Lord, Lord Rankeillour, which impressed us so much with its sincerity, with its concern for the people and his love for the Highlands, so much so that the considerable quantity of Highland blood I have in my veins was deeply stirred. He asked why the Forestry Commission have to plant all their woods in squares. I am reminded of a forester whom I knew, who had retired when I went abroad. I was home on leave, and in his old age I took him out one day and asked him where he wanted to go. He said, "Over there on the hill". We went to the hill opposite to the side of the valley he had worked in all his life. He had never been there before. He said, "Yon chap was a landscape gairdner". And I said, "Who do you mean?", and he was referring to the owner of the land at the end of the 18th century. He went on to say, "Can ye no see that the woods are like the shadows of the clouds across the hills?". Could the Forestry people bear that story in mind?

7.28 p.m.

BARONESS TWEEDSMUIR OF BELHELVIE

My Lords, if I may, by leave, speak again, I will try to reply to as many points as possible that have been raised in this most interesting debate. May I, first of all, join all those who have congratulated the noble Lord, Lord Rankeillour on his maiden speech. I think we all felt—I certainly did—that it was given not only with great knowledge but also with great feeling, not only for the Highland people but also the Highland land. And the noble Lord ended with a plea that, in all we do in the Highlands, it is very important that we seek to preserve the character and the amenity of our country, which is one of the most superb in the world, so that one day our sons will not have reason to condemn their fathers.

The noble Viscount, Lord Thurso, gave a fascinating analysis of the history of the Highland problems. Much of what he said could be duplicated exactly in my own county of Aberdeenshire. He gave the example of flagstones. What about Aberdeen granite, which used to be seen all over the world? Much of what he said does, of course, linger behind all the comments made by noble Lords on both sides of the House. He did, however, say that we should try to devise a Board without what he called unnecessary responsibilities, that the Board should be a catalyst and that it should be particularly selective in what it did.

So far as abolishing the Consultative Council is concerned, which is what he asked for, I do not think I can give him such an assurance to-day.

So far as tourism and the role of the Scottish Tourist Board and the H.I.D.B. are concerned, I agree with him, and with the noble Lord, Lord Burton, that if possible, there should not be any overlapping. The Deputy Chairman, Sir James MacKay, is also a member of the Scottish Tourist Board, and we felt that that might help in this respect. The Board are really responsible for regional organisation beneath the Scottish Tourist Board as a whole, and I hope that the joint office, which they have, for reference to the appropriate Board of applications or requests for help does a great deal towards ensuring that there is no overlapping.

My noble friend Lord Cromartie said that he hoped the Board would consult the local authorities and the landowners and would listen to their advice. I, too, hope that they will; and I have a feeling that they will, because I am sure that there are so many people from different parts of the country and with their own special knowledge who have spoken to-day, that it would be most unwise of the new Board not to listen to this advice.

My noble friend Lord Cromartie was one of several noble Lords who referred to the suggested Kyle railway closure. He regretted that the Highlands and Islands Development Board have not seen fit, like their predecessor, to ask that this particular line should be kept open. The Board have made their position clear, in that as they are officially asked to advise the Secretary of State, they feel not only that they should listen to all the protests and representations that are being made from all quarters, but that they should also make studies of their own—which they are now doing—and then come forward formally to advise the Secretary of State.

My noble friend the Duke of Atholl spoke about a great many subjects and asked a great many questions. Particularly as I was right in the gleam of his eye, I feel that I am bound to try to answer some of them. He asked whether we could alter the geographical boundaries of the Board in order to take into account certain regions on the periphery. Another noble Lord suggested that the Island of Arran was certainly one place that should be included. It is laid down in the Act which affects the Board that any such amendment can be made by Order. I would suggest to noble Lords who are interested in this subject that it may be better to wait until we have the White Paper on local government reorganisation, and then consider any proposals for such boundary changes.

My noble friend asked about Invergordon and pollution. I understand that there is a tendency towards pollution with fluorine, but that a special monitoring process is being established to try to bring any pollution of this nature under control at a very early stage. He also asked about the Kildonan-Strath Report. This was handed to the Secretary of State in November and will be published next month. My right honourable friend has already told Sir Andrew Gilchrist that a good many of its recommendations can in fact be accepted.

The noble Lord, Lord Strathcona and Mount Royal, spoke of the Western Ferries Service to Colonsay, as did my noble friend Lord Margadale in relation to his home base of Islay. I certainly agree that there is a great difference between the type of ferry supplied by the Scottish Transport Group and that supplied by Western Ferries, who are trying to produce an altogether much cheaper, and therefore more economical service. I myself travelled in the ferry from Lochboisdale to Tarbert, Harris, particularly to see the facilities on a side-loading vehicle ferry. Having spent four years with the Cunard Shipping Company I was reminded in some ways of the "Queen Mary" and the "Queen Elizabeth"—very comfortable indeed, but perhaps not wholly suited to the modern day. It is certainly true that the Scottish Transport Group now realise that they must have modern roll-on, roll-off facilities, and in fact the points made by both noble Lords on this matter have been taken into account in the discussions.

The same two noble Lords spoke about the Islander air services—what I think the noble Lord, Lord Strathcona, called the "bush" services. As one who has had the advantage of travelling a good deal in Canada, using all kinds of bush services, I would agree that sometimes we try to go too much for the larger type of aircraft and larger air landing strip, with all the facilities necessary for a much more complete service. It was matters of this kind that were given in evidence to the Edwards Committee.

My noble friend Lord Dundee paid what I thought was a very nice tribute to Sir Andrew Gilchrist. I hope that when Sir Andrew reads it to-morrow he will feel that the description that he is both gay and courageous is something to start him off well in his new task. My noble friend also spoke with great knowledge, gained from personal experience, of forestry. We were lucky to have the noble Lord, Lord Taylor of Gryfe, speaking to us but, following the convention of this House, as I understand it, he took care not to speak about forestry itself.

The noble Lord, Lord Hoy, asked about the extension of powers of the Highlands and Islands Development Board, as indeed did the noble Lord, Lord Taylor—as to whether the limit of £50,000 which the Board now have, before having to seek the consent of the Secretary of State, could be raised. I can say to both noble Lords that this particular limit is to be re-examined this summer.

The noble Lord, Lord Hoy, referred to grants for fisheries and asked whether the cuts would also apply to the H.I.D.B. area. My Lords, the reductions in grant for fishing boats will apply to this area. The Highland fishermen receive grants from the White Fish Authority or the H.I.B., and loans from the H.I.D.B. The Board have still to consider how to operate their second five-year fisheries development scheme, and may well propose to increase their loans to compensate for this particular provision.

The noble Lord, Lord Strathclyde, spoke about the Hydro-Electric Boards, and in particular about the North of Scotland Board. The Chairman of the Highlands and Islands Board, Sir Andrew Gilchrist, and Sir Thomas Fraser know each other well. I understand that both were born in the village of Lesmahagow. And through the part-time membership of Colonel Mackenzie there is also coordination on the Board. The Hydro-Electric Boards are still doing some industrial promotion, but, as I said earlier, the Scottish Council pare considering all promotion in every field, in order to try to avoid the overlapping which has been mentioned.

My noble friends Lord Salerno and Lord Massereene and Ferrard referred to the overall question of minerals; whether there is an overlapping between the work which is being done by mining companies and that being done by Dr. Robertson. It is perfectly true that the Robertson survey is a survey in the real sense. It is not a hard-rock, deep-mining exercise. There are of course already some powerful and experienced mining companies undertaking hard-rock mining and core drilling in various parts of Scotland. From what one hears there is a real possibility of development in this particular area. My noble friend Lord Massereene and Ferrard referred to the small industries, particularly in the West, such as the growing of fresh fruit, poultry farming, and bulb growing which should be encouraged. Like him, I support this idea very much because in the Uists, for instance, there was a major complaint that bread which came from the mainland was stale on arrival, and that it came at high cost. I wondered why it was not possible to have local bakeries, as they do in Stornoway. In addition, I believe local dairies could be encouraged, if the right people could be found to run them in the relevant locality.

My noble friend Lord Lauderdale, with, if I may say so, his usual agile mind, spoke about a variety of matters. He always brings new thought to our debates, and I am glad that he mentioned the whole question of the LASH type of ship. He asked whether I would prefer to write to him rather than reply to him in detail on this matter. I gratefully accept his invitation. My noble friend Lord Lovat quite rightly said, as indeed did my noble friend Lord Burton, that transport is really the key to some of our problems in the Highlands area. I am sorry that they do not feel that the Jack Holmes group has really given the attention that it certainly intended to do to some of the areas which they mentioned. My noble friend Lord Burton, as convenor of the Roads Committee in Inverness, will know very well the stage which the discussions have reached on this particular group report. I would only say about the roads in the Highlands as a whole that it is proposed to spend in the seven crofting counties £3 million a year on trunk and principal roads over the next five years at least. So far as the A.9 in the Perth to Inverness area is concerned, it is our hope to spend, over the next two years, about three-quarters of a million pounds in improvements of various kinds. My noble friend Lord Ferrier came in at the last moment and asked particularly about the Catering Wages Act. I can only say to him at this moment that that is a question of which I shall take note, and I shall write to him in due course.

My noble friend Lord Lovat spoke about hill farming. I quite understand, having once been a hill farmer myself, the difficulties of costs in this particular branch of agriculture. I pointed out to those noble Lords who were interested in agriculture the rules in Appendix XII of the Highlands Board's Fourth Report. The reason why the Highlands Board, to date, has not spent so much on agriculture is because it does not wish to overlap with the Department of Agriculture, or indeed with the Crofters Commission. Nevertheless, my noble friend Lord Lovat will recall that in the adjustment of agricultural prices which was announced in October last by the present Government, the final price of fat cattle and sheep was increased, and that should have helped a little. At the same time, the Government made a substantial increase in the rate of hill sheep subsidy.

Lord Lovat was the only noble Lord to mention the disquiet which is felt in the Highland area about the position of the hill farming industry if we join the European Economic Community, and whether the special grants, which we have, and of which the subsidies in the Highland area alone amount to an annual total of £12 million, can continue. I think there is a good chance that these grants could be continued after entry. If it proved impossible to continue them in their present form, it seems very likely that equivalent assistance could be given in other ways. One thing is absolutely certain; that is, that hill farms, and particularly the poorer type of hill farm which predominates in parts of the Highlands, cannot survive without special assistance.

I should like to end this debate—I hope I have answered at any rate some of the points which have been raised—by referring to our possible entry into the European Economic Community, because I think my noble friend Lord Lovat was the only speaker who mentioned it. The position of any possible regional incentives is vital to our future. The Treaty of Rome states in Article 92: Aid intended to promote the economic development of regions where the standard of living is abnormally low, or where there exists serious unemployment, and aid intended to facilitate the development of certain economic regions may be deemed to be compatible with the Common Market. I think this is very important to us. Each State is responsible for regional policy, and each disposes of a wide range of economic measures in support of depressed regions. In actual fact, regional policy has not been raised as an issue by either side in the Brussels negotiations, and so far it looks unlikely that it will be raised by any of the Six in view of their own substantial commitments in this field.

I would thank your Lordships for letting me speak once again, and I would say that I hope that you feel that this debate has been useful. I am sure that the Highlands Board, when they read the debate again, will find your Lordships' advice of very great assistance, and I should like to thank all those who have taken part.

LORD HUGHES

My Lords, before the noble Earl rises to conclude, I should like to ask the noble Baroness about the reply which she made on the subject of the Catering Wages Act. I think she said it was quite obvious that she could not deal with that matter to-day; but the matter now having been raised, it is of much greater interest than just to the noble Lord who initiated it. If the noble Baroness writes to him only, the rest of us will not be aware of the position. May I suggest that when she is in a position to give him an answer she invites the noble Lord, Lord Ferrier, to put a Question down, so that she may then answer in the House and we shall all know whether she is saying "Yes", "No", or "Maybe".

BARONESS TWEEDSMUIR OF BELHELVIE

My Lords, in reply to the noble Lord I would point out that it is not really for me to comment on the Catering Wages Act, but I will certainly write to the noble Lord and ask him whether he wishes to put down a Question.

LORD FERRIER

My Lords, I should be delighted to do so. I only made the remark off the cuff because I happened to know that it was a serious matter. I will comply with what the noble Lord suggests.

7.48 p.m.

THE EARL OF PERTH

My Lords, I am proud to have had the good fortune to initiate this debate. I am proud because the noble Lords who spoke after me spoke so constructively, and with so much local knowledge, and, I know, so valuably for the Board, who have been listening to what has been said, and who have a task ahead of going on their way in a new direction. I am also delighted that this has been the occasion when my noble kinsman, Lord Rankeillour, make his maiden speech. It was a speech which was thoughtful, valuable and heartfelt. I hope that he will speak frequently from now on.

I was delighted that the noble Baroness said what she did about S.E.T., and I hope it will not be long before we find that—how shall I put it?—the toe is put into the water in the Highlands and Islands. A constant theme that ran through the whole of the debate was transport, natural resources; and several noble Lords made what I thought was a very important point about television and its bad reception. Some of your Lordships will have read of the gallant action of Colonel Michael Lyle who refused to pay his licence fee. He was prosecuted by the B.B.C. but got off with a "non-proven" verdict. Before your Lordships follow his example, I suggest that you carefully read exactly what was the basis on which he got off.

We have been talking about half of Scotland, and clearly the Board must walk warily between preservation and development. Furthermore, they have been warned not to interfere too much with the independence and pride of the Highlands. All the same, I know that I voice the wishes of your Lordships when I say to the Chairman and to the rest of the Board that I hope they prosper and succeed well in their task. My Lords, I beg leave to withdraw my Motion.

Motion for Papers, by leave, withdrawn.