HC Deb 02 July 1959 vol 608 cc620-739

Motion made, and Question proposed, That this House takes note of the Report on Industry and Employment in Scotland and Scottish Roads, 1958 (Command Paper No. 706).—[Mr. Maclay.]

3.43 p.m.

Mr. James H. Hoy (Edinburgh, Leith)

The debate this afternoon is a continuation of the one we started a month ago. Before referring to that debate, may I remind the House that a year ago I had the opportunity of opening a similar debate? On that occasion I came in for a considerable amount of criticism from some back benchers opposite, criticism, let me say, that was not repeated either by the President of the Board of Trade or by the Secretary of State for Scotland.

In the debate a month ago attention was called to the increase in unemployment in Scotland, where the figure had risen from 55,000 in 1957 to 77,500 in 1958. During the debate the President of the Board of Trade said that this increase was part of the price that we had to pay for steadying prices and for steadying the £. Having done that, we could now look forward to an expansion in industry and a corresponding fall in the number of unemployed.

Since then we have had the benefit of two speeches from the Chancellor of the Exchequer. One was delivered at a garden fete in Elgin. This speech was not regarded as being in very good taste by either the Scottish Press or the Scottish people. The right hon. Gentleman described us as being a rather expensive part of the community, but one that he was prepared to tolerate. We thought that was carrying his humour a little too far. If the right hon. Gentleman cares to consult the opinions of the Scottish people on his speech, I recommend him to read the leader in the Scotsman of the following day. I am sure that that will leave him in no dubiety about how Scotland felt about that rather patronising speech.

Mr. James Stuart (Moray and Nairn)

I listened to the whole speech. If, like a right hon. Member the hon. Gentleman opposite at Question Time to-day, the hon. Gentleman has no sense of humour, it is a pity.

Mr. Hoy

The right hon. Gentleman may have thought that it was humorous, but the Scottish people did not regard it as a good speech; and the Scottish Press took the same view. If the right hon. Gentleman himself had been able to deliver it he would have been just as bored with it as he was with one of his own on a previous occasion.

The Chancellor then made a further speech, in this House, when he was dealing with the unemployment figures. That speech was not so much a speech of information as one made for the hustings. It was a speech which followed one delivered by the Minister of Labour at the Tory Women's Conference last week. In the course of his speech the Minister of Labour said, "Was it not awful that unemployment should be used for political purposes?" Having said that he went on to do exactly that, to use unemployment for political purposes.

We are getting a little tired of this confidence trick of the Minister of Labour who thinks, or wants people to think, that he is really clever because he forecasts a tremendous increase in the figures of unemployment, higher than anything we have had before, and then thinks it is clever if he is proved to be right. The Minister knows that he will be right before he starts, because these figures are the result of the Government's policy. The President of the Board of Trade made that quite clear when he said that that was the price we had to pay for steadying the £ and restricting the cost of living. Unemployment is rising as a direct result of the Government's policy.

There might be some credit for the Government if they had restricted the cost of living, but they have not done so. Since the Government came to power the cost of living has gone up to the highest point that it has ever been. Having got it to the highest point, apparently they think that they ought to take some credit for keeping it there.

What a contrast there is between the programme presented to the electorate and the Government's performance! It was in Scotland that the Home Secretary delivered his speech at the hustings, saying that the Conservative Party would not reduce subsidies on food until it had decreased the cost of living. I leave it to the people to judge.

The Chancellor now seems to be indulging in the same sort of trick. Speaking in the House on Monday he said that unemployment in Scotland had been reduced by one-third since its peak. He seemed to regard this as an achievement. I would ask the Secretary of State: who put the unemployment figures up to their peak? This tremendous incease in unemployment has taken place under the Conservative Government.

Let us look a little more closely at the figures which, apparently, give the Chancellor so much satisfaction—a satisfaction which is not shared by the Scottish people. What are the figures he is boasting about? Between 1957 and 1958 unemployment in Scotland rose by 22,500, and in June of this year the figure stood at 85,296. Even worse, from a Scottish point of view, is the fact that 9,000 of that increase is represented by men of 18 years of age or over. The Chancellor is seeking to convey to the people that we are making great inroads into this problem, and that there is a period of great prosperity ahead, but the Government's policy leaves Scotland with 10,000 more unemployed than there were twelve months ago.

Today, unemployment in Scotland stands at 4.4 per cent.—the highest in Great Britain. For every person unemployed in London and the south-eastern area, four people are unemployed in Scotland. The hard fact is that with one-eleventh of the insured population of Britain, Scotland has one-fifth of its unemployed. These are appalling figures, and I wonder whether any of those hon. Members opposite who were so anxious to belittle this situation a year ago would care to rise today and justify what has happened during the last twelve months. These figures may give joy to the Chancellor—and they may give an opportunity to the Minister of Labour to deliver a slick speech—but I can assure the Secretary of State that they bring the greatest dissatisfaction to the Scottish people.

Bad as these figures are, there is one other matter that we must take into account when considering the problem, namely, the number of people registered as employed. Even on the 1958 figures, 48,000 fewer people were employed in Scotland than was the case in the previous year. Since then there has been a further decline, of considerably more than 200,000, in the number of people insured for employment in Britain. These figures were given both by the Minister of Labour and by the President of the Board of Trade. If Scotland's share of that works out similarly to what it has in the past, it means that Scotland will have 50,000 fewer people available for employment than she had a year ago. Although the Government have got the unemployment figures down to 4 per cent., 100,000 fewer people have become available for employment in Scotland in the last two years. That is a very serious position, and the Secretary of State had better take note of it before it goes too far.

As if that were not bad enough, we have since had some news which does not encourage us to think that Scotland is sharing in this so-called recovery. Last week, Scottish Aviation told 400 of its workers that they would be receiving notices of dismissal. I am told that those notices were received today. This is not unskilled labour; it includes technical and administrative staff. That does not spell future prosperity for that part of Scotland.

In addition to that, Standard Maclean Limited is to close down part of its Lanarkshire factory. The firm issued notices on Friday. This factory, which is in Hamilton, makes window frames, and is part of a bigger combine in England. Notice has been given to 250 male workers, but that is the minimum number. As the Parliamentary Secretary to the Board of Trade knows, in all probability the figure will rise to 350 by the end of this or the following week.

Not very long ago the Parliamentary Secretary said that the Government had no information that large English firms were taking action to close their Scottish branches and to concentrate on their English production.

The Parliamentary Secretary to the Board of Trade (Mr. John Rodgers) indicated assent.

Mr. Hoy

What happened about this firm? Only three weeks ago the Board of Trade said that it could go ahead with its extension, but instead of extending its factory it is giving notice to at least 250, and perhaps 350, of its men. The unemployment figures given by the Chancellor on Monday are already out of date, since another 750 men in Scotland have received, or will receive, notice.

This cannot go on. We must remember that the heavy industries, upon which Scotland has been so dependent, are in a state of decline. Let hon. Members consider what is happening in the mining industry, in heavy engineering, and in shipbuilding. In all those industries there is a decline. In my constituency, which has had a splendid record in labour relations, and where the shipyards have turned out ships for all parts of the world, to the satisfaction of all their customers, men who were not unemployed even in the black 1930s are now signing on at the labour exchanges. If there is any further decline in these basic industries, what other employment opportunities will be available for the people of Scotland?

We are entitled to ask the Secretary of State what is being done to meet this situation. The position has been admirably summed up by the bulletin of the Scottish Council (Development and Industry). I shall quote from it, because the Secretary of State had many nice things to say about its chairman in a similar debate a month or two ago. I do not claim that the points made in the bulletin are original; indeed, they are points which have been put by my hon. and right hon. Friends over the years.

The bulletin says: The absence of the more rapidly growing industries and the inevitable contraction of some established industries account for the intractability of the Scottish employment problem It will not be solved by short-term or limited measures. The successes of the last two decades demonstrate what can be done by a combination of forceful voluntary effort and resolute Government action. On the Scottish Industrial Estates 66,000 new jobs have been created. Completely new sectors of industry have been founded—by existing companies, as in the Scottish Electronic Scheme, and by importation, as, for example, the office machinery and earth-moving equipment industries. It is clear, however, that the official policies and provisions as they now stand, and the voluntary endeavours to promote industrial development and a balanced economy in Scotland, despite their considerable successes, do not meet the present and continuing need for expansion of employment in Scotland. That sums it up. It is what we have been attempting to say over the years. We have not had very much response from the Government. My mind goes back to the days when the late Sir Stafford Cripps was battling with industrial estates to persuade people to build the factories which were then being built. Scotland should be for ever grateful to that immediate post-war period which laid the foundation for the 66,000 new jobs which are filled today. We must have that type of action if we are to overcome our present difficulty.

The Scottish Council (Development and Industry) also made certain suggestions to the Government, and it has submitted them to the Secretary of State for Scotland. We agree, broadly, with those suggestions. They are suggestions which have been made from this side of the House times without number, and in the course of many visits during the last Christmas and new year Recess the Scottish Industry and Employment Group of the Parliamentary Labour Party was hammering those very questions with the Scottish Council, with the Scottish Board for Industry, with the Economic Committee of the S.T.U.C., and many others.

What does the Scottish Council (Development and Industry) ask for? It asks for new and advance factories. The Minister will say that they have given us one factory as a trial. Scotland's days for trials are past. We have had plenty of factories without trying them out. We want factories. It has also suggested restricting factory rents. We had to raise with the Parliamentary Secretary to the Board of Trade the policy of restricting these rents if we were to encourage new industry to come to Scotland. It asks for investment allowances and for an acceleration and expansion of road programmes. It is still asking what is to happen to the graving dock at Greenock.

Cannot decisions be made about these matters? This is the programme being asked for. It is the programme we have attempted to stimulate over a long period, but it has taken the Government a very long time to decide what they will do.

I turn to another important suggestion which will help Scottish industry. The Scottish Trades Union Congress suggested to the Scottish Council (Development and Industry) that it should send a delegation to Russia to see whether further trade could be stimulated between Russia and Scotland. I know that the Scottish Council has replied that it is agreeable. It agreed in principle, but it did not think that a delegation could be sent before next winter. But next winter may be too late.

In pre-war days the port of Leith, which I represent, carried on a considerable trade with the Baltic countries, and there was a considerable trade with Russia in both directions. Since the war there has been trade with Russia: ships have been arriving carrying timber and grain. There used to be a lucrative and regular trade between the port of Leith and Russia. We are told now that, as a result of the recent trade delegation to Russia, London and Hull have been nominated as the ports to handle the trade.

If that is true, we want to know now whether Scotland has been by-passed once more. Is a port such as Leith, with its fine record, to be ignored? Those running the business of the port of Leith have done their best to create trade between the two countries, but if action of this kind is to be taken all their efforts will be in vain.

In view of the considerable trade which took place between Russia and Scotland—a fair amount of it is going on today, because there is an agreement between the Scottish Co-operative Wholesale Society and certain other firms and Russia—we are asking for Government assistance to attract trade to our country. We should like a reply as to what arrangements have been made about the carrying of this trade. We are not the only ones asking for some Government assistance. I ask the Government to think about all the assistance which has been asked for by private enterprise.

During the last debate it was made clear not only by my hon. Friends, but by hon. Members opposite—although I am sure that many of them did not like to have to admit it—that Scotland's economy can be restored and her future assured only by Government action and money. I do not think that anyone will demur from that. I remind the Government of all the help which has been asked for in the form of Government money, whether it has been by Colvilles, the Cunard Company, or anyone else.

Even the hon. Member for Glasgow, Pollok (Mr. George), who professes to be such a rugged individualist, wanted Government money and asked for it for private enterprise. In the debate on unemployment three and a half months ago the hon. Member said: There is not enough capital in Scotland to make a quick change in the diversification of industry. We have too few companies in Scotland with millions of pounds to expend. We have to do two things with State money. We must go South, and, by presenting a picture of profit, helped by State money, we must induce two or three of the English giant businesses to expand in Scotland—the electrical industry, the motor vehicle industry, and the consumer goods industry."—[OFFICIAL REPORT, 18th March, 1959; Vol. 602, c. 508–9.] That statement leaves no room for any ambiguity. The State, and the State alone, apparently can provide the solution to our problems. If that is so, it is not too much to ask that the State will have some say in the direction of these industries and of their policies.

I suggest that the case made by my hon. Friends a month ago, which will be supported by those of them who speak today, to which I have had the privilege of lending a few words of support, is the only one which can provide a future for Scotland. The suggestions I have made must be carried out if Scotland is to have a secure economic future. Around the strip mill and in the plastic industry new works must be built. Employment must be provided for the Scots of the future. That is the least that Scotland can ask. Anything less than that can only spell failure. If it is failure, I dread to think what will happen to the people of Scotland. If the Government cannot do this, let them clear out and make way for a Government who can.

4.10 p.m.

The Economic Secretary to the Treasury (Mr. F. J. Erroll)

Before I turn to the main burden of my remarks I would say to the hon. Member for Edinburgh, Leith (Mr. Hoy) that some of the principal points of detail which he raised will be referred to by my right hon. Friend the Secretary of State for Scotland when he winds up the debate tonight. My right hon. Friend particularly asked me to say that he will make reference to the problem of shipping from Russia and the Port of Leith, to which the hon. Member made such special reference. A further point is about the unemployment figures, to which the hon. Gentleman referred and which, in detail, will be commented upon by my right hon. Friend.

Miss Margaret Herbison (Lanarkshire, North)

Cannot the Economic Secretary give us information about areas in Scotland where there has been an increase in unemployment between May and June? It is of the greatest importance that we should have the information now, for the debate.

Mr. Erroll

I could not do this straight away, but I will see whether it is possible for the hon. Lady to have the figures before the end of the debate.

All the evidence published in recent months shows that Britain has made a substantial economic recovery and that a period of steady economic expansion is now under way. The hard fact remains, however, as was made clear not only by the hon. Member for Leith today, but also by those who spoke in the debate a month ago, that Scotland has not shared in this recovery to anything like the same extent.

Nevertheless, I think that there are hopeful signs. I was agreeably surprised to see the tone of the Glasgow Herald supplement, "Industry and Commerce" which was published on 1st June. While giving full prominence to the dark spots in also included headlines such as: A change of mood: All set for expansion". Exports: Scotland's broadening range". I do not want to make too much of that—[HON. MEMBERS: "Hear, hear."]—but I am entitled to point to some of the favourable as well as to some of the unfavourable features. I will not burke the unfavourable features. I will refer to them fully, but I am entitled to refer to the favourable ones.

Mr. William Ross (Kilmarnock)

The hon. Gentleman has referred only to headlines. If he had read the article I think that he would have found that the headlines referred to the position in Britain.

Mr. Erroll

I was careful not to quote the headlines which referred to the position in Britain as a whole. There was one on the front page, but I saw that it referred to Britain as a whole and not to Scotland, so I deliberately did not refer to it. I do my "prep" as well as the hon. Gentleman.

I do not want the House to get the impression that the Government are in any way complacent about the position in Scotland. Far from it. We are disappointed that Scotland has not shared fully in the general return to economic prosperity, and I shall suggest why this has been so and will outline the Government's attitude.

Although industry as a whole has benefited from the economic expansion of the last six months, the fact remains that there are still certain industries which have not fared so well. This has a special relevance to Scotland. The production of motor vehicles, for example, and consumer goods, domestic house building and light industry generally have been increasing, and indeed, for motor cars, in particular, waiting lists are beginning to appear once more.

In heavy industry the position is much more uneven. There has been some recovery in the steel industry, but the heavy end of the industry is still working well under capacity. Shipbuilding has not recovered, although the big yards have a large number of orders on hand. The demand for coal remains sluggish. Certain sections of the capital goods industries are still working well below capacity. This pattern is accentuated in Scotland owing to the preponderance of heavy industry in relation to light industry, which is such a well-known feature of the Scottish scene.

I should remind the House that light industries in England have had their bad as well as their good times. Only two years ago the motor car industry was going through a very difficult time. I am sure that it would be wrong, even if it were possible, to try to base Scotland's industry entirely on light industrial manufacture, because Scotland would then be even more vulnerable to swings of the economic pendulum than before. The right objective to pursue is to strive to maintain Scotland's heavy industries while, at the same time, securing much greater diversification by the introduction both of light industries, some of which could use the products of the heavier industries themselves, and of more commercial firms.

This is not a new problem for Scotland—[HON. MEMBERS: "Hear, hear."]—as I am sure many hon. Members would agree. [An HON. MEMBER: "We have heard that before."] At least the House is hearing a different voice saying it, so that is something. It has been a Government problem for the last thirty years, and successive Administrations have done their best to solve it. I have many figures which might be quoted, but I will refer only to the figures of employment provided by new factory building in Scotland since 1945. Almost 100,000 additional new jobs had been so provided up to the third quarter of 1958. Taking the two periods of six years 1945–51, and 1952 to the third quarter of 1958, about 50,700 jobs were provided in the first period and almost 49,000 in the second period. And, of course, more jobs have been provided since the third quarter of 1958 and in the first part of 1959.

This shows that both Administrations since the war have shared equally in the task, and in the success achieved, in providing additional jobs.

Between those two periods there has been a change of emphasis. During the first period, 20,000 jobs were privately financed while, during the second period, the figure was 31,000. I regard this as a very good sign. We want privately-financed industry to develop in Scotland as well as industry financed by the Government. It would be a sorry day for Scotland if no one were prepared to develop there without some form of Government assistance.

My right hon. Friend the President of the Board of Trade uses his powers under the Distribution of Industry Act, and the Town and Country Planning Acts, and the help of his regional officers, to steer industries away from the south-east part of England and the congested Birmingham area into those parts of Britain where such new industry is needed; and in the context of today's debate I have Scotland particularly in mind. His policy, as he has explained on many occasions, is a firm one, but, short of compulsory direction of industry, and, therefore, of key workers and managements, it must rightly remain a policy of persuasion.

The hard fact remains that some industrialsts are reluctant to set up light industries in Scotland because they feel that, apart from the local Scottish markets, they are a long way from the large consumer markets, such as Lancashire, Yorkshire, London and Birmingham. We are doing our best to get over this difficulty by pointing to the number of successful Scottish enterprises the goods from which, made in Scotland, are household words all over England. If I may quote one or two examples, which I am sure will be familiar to hon. Members, there are Penguin biscuits, Timex watches and clocks and Remington shavers, among others.

Mr. Cyril Bence (Dunbartonshire, East)

Is that all?

Mr. Erroll

I did not want to make my speech a dull one, with successive quotations from long lists, but I picked out one or two which struck me particularly.

Furthermore, the introduction of the new British Railways overnight freight services, such as the "Condor", will greatly improve the opportunities for Scottish manufacturers to place their goods on sale in the big consumer markets in London and the surrounding suburbs.

I should like to remind the House in more detail of what British Railways are doing to provide improved freight services from Scotland. It is an impressive list. The "Condor" service, in particular, is a remarkable one. The service started on 16th March this year and provides one service each day in each direction. A new method of charging has been adopted whereby British Railways hire a container to the customer at a flat rate and the customer can put in what goods he likes provided they do not exceed a maximum weight.

All that the customer has to do is to put the goods into the container which is taken on one day for delivery in London the following morning at a flat rate. That is a very useful development. [An HON. MEMBER: "It has not been late once."] I hear an hon. Member saying that it has not been late once. There is also an extension of the "Assured Arrival" service now to Newcastle and Gateshead from Edinburgh and Glasgow. There is also an export express service between Glasgow and Liverpool Docks giving an arrival the following morning; and a rather specialist new train, the "Blue Spot Fish Special", which consists of specially fitted vans having roller bearing axles, which runs between Aberdeen and London, giving an earlier arrival in London.

There are other improvements in the service which are too detailed to mention now. All this shows that British Railways are doing a big job to make it possible for manufacturers in Scotland to bring their goods rapidly to consumer markets in Lancashire, Yorkshire and the Midlands.

Similarly, the major road reconstruction between Glasgow and Carlisle referred to in the Scottish Roads Report will greatly improve the movement of long-distance lorry traffic which is such an important part today of our internal distribution system. The parallel development of roads in England will provide excellent facilities for both east and west coast traffic from Scotland with interchange via the Birmingham links.

Mr. Thomas Fraser (Hamilton)

It will not.

Mr. Enroll

The hon. Member may say that it will not, but I am assured that it will. The hon. Member had a good chance to make points in the earlier debate. I beg to differ from what he says.

Mr. Thomas Steele (Dunbartonshire, West)

Is the hon. Gentleman aware that some of the works programme for this particular road, announced by the Secretary of State for Scotland before the last General Election, has not yet been started?

Mr. Erroll

It is going on as fast as it can.

Mr. E. G. Willis (Edinburgh, East)

But it is not good enough.

Mr. Fraser

Is the hon. Gentleman aware—he hardly can be, because he is not familiar with this subject, but some of us actually live on this road—that the part of the Glasgow—Carlisle road which goes through industrial Lanarkshire and my constituency has had no work done on it and that all the work between Lesmahagow and Carlisle will only speed up traffic going into the bottleneck between Larkhall and Glasgow?

Mr. Erroll

It is always difficult to effect a road improvement in a heavily built-up area. My constituency is one of those and there is great difficulty there about bottlenecks in Altrincham and Sale.

That should have been done before, but at least it is being done now. The point is that not only will this improvement of opportunities for fast road transport of goods from Scotland link up with parallel roads in England, but it will provide excellent facilities for both east and west coast traffic with the interchange via the Birmingham links. These transport facilities, both by rail and by road, are an important matter, because they will go a long way towards removing the so-called geographical handicap which—wrongly, in my view—has held back a number of industrialists from going to Scotland to set up new factories.

There is one important new development to which I should refer. That is the new strip mill which is being built at Ravenscraig. I need hardly remind the House of the number of consumer industries which require steel strip and sheet. When I was Parliamentary Secretary to the Board of Trade I had something to do with the siting of the new Pressed Steel plant near Swansea. We were responsible for persuading the company to go to West South Wales to a site near Swansea, and one of the factors which influenced the company was that it would be able to draw upon adequate supplies of steel from the nearby strip mills of the Steel Company of Wales. Obviously, I cannot go into the precise economics of this particular project, but I can say that this advantage went some way towards offsetting the additional cost of transporting the finished products to the main areas of consumption.

Now that Scotland will be able to offer, in the relatively near future, abundant supplies of steel strip and sheet, I feel confident that the Board of Trade will be able to persuade companies wishing to expand to look favourably on setting up in Scotland in much the same way as Pressed Steel was persuaded to set up in West South Wales. Indeed, one company is already showing how successfully refrigerators, for example, can be made in Scotland. I refer to the Astral Company of Dundee, which rented a Board of Trade factory in 1948 and which, with a further extension now nearing completion, will have expanded just over fourfold. In addition, building work has now started on a large new factory for this firm which with existing capacity will give a total production space thirteen times greater than that with which it first started in Dundee.

What one company has done so successfully I am sure other companies will be able to do with the added stimulus of locally available supplies of strip. As the improved transport facilities—both road and rail—which I have mentioned, become better known, the old geographical handicap, so to speak, should greatly diminish in importance.

Nor should we forget—although I know that this is traversing familiar ground—that a considerable amount of quite new industry has already been introduced to Scotland. The hon. Member for Leith referred to the manufacture of office machinery at Dundee and Greenock and to earth moving machinery. There are the firms of Caterpillar and Euclid, in North Lanarkshire and such varied products as those made by Playtex, at Port Glasgow, and the Sunbeam Electric Company, at East Kilbride. This effort on the part of the Government, industry, the Scottish Council, and others, has, regrettably, not been enough to reduce Scotland's level of unemployment to that which now prevails in England as a whole. We accept the need for more effort, and we are working as hard as we can to bring new industry to Scotland and to expand existing ones.

The objective remains the same, namely, to ensure a continuing high level of activity for heavy industry while, at the same time, diversifying the Scottish industrial scene by the introduction of a widening range of light industries. While it is proper that we should concentrate on the provision of additional manufacturing industry, it is important to remember the increased amount of employment which is provided nowadays by service industries and offices. By using the telephone and other modern methods of transmitting information over long distances there is no reason why more office work, for example, should not be done in Scotland rather than in the congested areas of London and the Midlands.

It is not easy to persuade firms whose employment roll largely consists of office workers to consider hiving off a substantial portion of their routine work to a different part of the country. Of course, as I must remind hon. Members, the Government have no powers in a form similar to the industrial development certificate to help in bringing about a changed outlook in this matter.

Mr. Hoy

The Government certainly have power over their own offices. May I remind the hon. Gentleman that the Department of Scientific and Industrial Research for Britain was sited at East Kilbride because of the action of the Labour Government. Cannot he take similar action with regard to that other type of work?

Mr. Enroll

The Government have a fairly good record of decentralisation. It has large offices at Newcastle and further offices at Blackpool, so there is a considerable measure of decentralisation from London. We may not have been able to get as much to Scotland as we should have liked, but we have a good record compared with private industry in this matter. I hope that we shall be able to see more office work being decentralised into Scotland.

This development of office work is worth paying increasing attention to because it is not without significance that unemployment in Edinburgh, with relatively little heavy industry, has, over the years, generally been lower than that of the surrounding industrial districts. I suggest that some part of this must be due to the many head offices of Scottish insurance, banking and investment trust companies which operate there and contribute very substantially, no doubt, to our invisible export balance.

Edinburgh's favourable position is also doubtless due to the employment created by the tourist trade. Time will not permit me to say much about that industry, but it is growing in size and importance every year and Scotland is getting its full share of that growth. It will bring additional employment not only in summer, but also in winter; and, in fact, the severity of Scotland's winter may prove in its own way to be something of a tourist attraction as more and more people begin to realise the possibilities of winter sport, which I think hon. Members will accept is an attraction to people to go there in the winter.

Mr. John Rankin (Glasgow, Govan)

It is not an attraction for us.

Mr. Enroll

The visitors themselves need to be serviced and looked after and all that helps to bring employment.

We do not want to think only of manufacturing industry. I know that that must be a main feature, but we want to look at the other subsidiary sources of employment which can all help to make their contribution to a high level of prosperity.

I should like to remind the House of the action which the Government had taken in the field of public investment. The Chancellor of the Exchequer stated in the debate on the Address on 3rd November last that a review of public investment was held during the course of last summer and this resulted in a series of specific but limited relaxations designed to stimulate employment during this coming winter, particularly in those areas which were suffering most heavily from unemployment."—[OFFICIAL REPORT, 3rd November, 1958; Vol. 594, c. 641.] In the case of Scotland, as my right hon. Friend the Secretary of State pointed out on 10th March, these measures were expected to lead to the expenditure of nearly £10 million of additional money by local authorities, Government Departments and other public bodies in Scotland, the expenditure to be incurred by 31st March, 1960.

Perhaps I should mention how the figure of additional expenditure is made up: schools, technical education, etc., £2,800,000; housing. £2,100,000; hospitals, £1,150,000; electricity boards, £1 million; trunk and classified roads, £310,000: miscellaneous local government services, £600,000, and a number of other items, bringing the grand total to £9,675,000. This additional expenditure should produce a useful stimulus to employment.

Nor is this all. The total of public investment in Great Britain for 1959–60 is £1,607 million. Many of the programmes included in this total cover the whole of Great Britain and the Scottish share is not known—[HON. MEMBERS: "Oh."]—with sufficient precision to make a comparison. Of those which can be separated, such as electricity, roads, local authority housing, water, sewerage, education and hospitals, the Scottish share is about one-seventh. This does not seem unreasonable in view of the fact that Scotland's share of the population is nearer one-tenth.

Dr. J. Dickson Mabon (Greenock)


Mr. Erroll

It is not rubbish. I am saying that Scotland has a good share on a population basis of public sector investment.

I should have thought that hon. Gentlemen opposite would have been rather pleased, but it seems that I find myself in some difficulty in this debate, because when I say something which is obviously to Scotland's advantage hon. Gentlemen opposite seem to dislike what I am saying. I should have thought that it would have been something that would have pleased hon. Gentlemen opposite. At least, it ought to be regarded as a helpful direction in the allocation of resources.

Mr. Willis

Would the hon. Gentleman tell us what percentage of research expenditure we are getting and what percentage of expenditure on defence services we are getting? Will he tell us some of the things that are not so very favourable to Scotland?

Mr. Erroll

The defence services would not come under the heading of public sector investment. I was dealing here with public sector investment, because that represents civil expenditure on the public sector by Government Departments and local authorities, which I thought was a fair way of doing it.

I am glad to have the opportunity of speaking this afternoon because there is one matter for which the Treasury has direct responsibility—one form of Government aid—and, therefore, I want to say something about the financial assistance provided by the Distribution of Industry (Industrial Finance) Act, 1958, and to bring the figures up to date. Since our last debate, on 3rd June, the number of applications and the number of approvals has continued to rise. Up to 30th June, 106 firm and eligible applications had been received in respect of Scotland, 27 of these have been favourably recommended by the Advisory Committee, 8 have been rejected, and 71 are still being examined. The total value of assistance offered in the 27 successful applications is £774,520. Apart from £7,750 provided by way of annual grant, this assistance took the form of loans at moderate rates of interest, repayable on terms tailored to suit the individual needs of the applicant.

This should help to produce almost 1,000 new jobs of a permanent character for Scotland. The loans offered range from as little as £220 in one case to £400,000 at the other end of the scale. I should like to have been able to give the House more exact and precise details concerning individual applications, but these applications are made in confidence and, for reasons which I shall give in a moment, it is most important that we should maintain the confidential relationship between the individual borrower and the Government, who are the lenders. I shall try to explain it.

Dealing with the unsuccessful cases first, the firm or individual whose application for assistance is turned down often feels very sore at not being given any reason for the rejection of his application. Quite frequently, the Member of Parliament concerned is brought in, and he, too, quite understandably, feels frustrated when I am unable to make available to him the Committee's reasons for rejecting the application.

The principal difficulty is that we would have to be prepared to give the reasons in respect of every application that had failed. In some cases, the standing of the firm might be in question and it would be embarrassing to have to explain this. To refuse could be equally embarrassing. In other cases, the commercial prospects of the firm might be considered less favourable than the applicant imagined. D.A.T.A.C. has to form a view on this, and disagreement with the applicant on such a difficult subject could only lead to further argument of a fruitless character. If we were to give the reasons in some cases and not in others, it might be inferred, wrongly perhaps, that in those cases where the information was withheld there was something known against the applicant which could not be made public.

Hon. Members may ask why we should not at least make available information about applications which have been successful. After all, they, at least, passed all the tests, and, it may be said, as those applicants are receiving assistance from the Treasury, surely Members of the House of Commons should have the right to know all about them. I mention these matters in some detail, because the subject of D.A.T.A.C. aid was referred to a great deal in the debate a month ago and I know that it is something about which a large number of hon. Members are concerned.

It is the fact that, in some cases, successful applicants make known the assistance they are receiving, but there are others—these others are important, too—who wish to keep the matter confidential for good reasons of their own. They may not wish to draw attention to their financial position, or they may not wish their plans for expansion to be made known to their competitors until the last possible moment.

Were it to become the general rule that details of all successful applications would be published, then some firms, I know, would not dream of applying for assistance. In fact, I know of more than one firm which was doubtful about applying because it felt that its plans would become known to a wider circle of people. It was only when the confidential nature of the scheme was fully explained to it that the firm decided to go ahead with its application.

I should like to tell hon. Members more about the details of the scheme, and I know that there are hon. Members who would like to have more information about individual cases in which they are interested, but I do not think that it would be right to jeopardise the chances of even one successful project, just because we insisted upon information being made available in all cases. We should not be at all pleased if we knew that, let us say, 50 or 100 men had remained unemployed in a particular locality, simply because a firm which would have gone there preferred not to apply because it feared that its commercial development, its financial standing, or other private information would become public property.

Mr. T. Fraser

This may be a very interesting part of the Economic Secretary's speech to some hon. Members, but I am not aware that hon. Members on either side of the House have been pressing the Government to disclose this kind of information about individual applications for D.A.T.A.C. advances. I have never heard this demand expressed in our debates.

Mr. Erroll

I would have referred to one case in particular, a case put forward by the hon. Member for the Western Isles (Mr. Malcolm MacMillan), but as he is not in his place today I thought that I would not refer to it. Also, other hon. Members have approached me privately or have put Questions and supplementary questions about individual applications. I thought that this would be a useful opportunity to explain the reasons for our attitude. I am sorry that the hon. Member for Hamilton (Mr. T. Fraser) is not aware of the point. It is, I a matter which, I know, interests many hon. Members, because they have approached me, and I thought that a minute or two devoted to the subject would be time well spent.

However, I can speak in fairly broad general terms without any risk of a breach of confidence. I can tell the House that rather more than half the present total of Scottish applications and appreciably more than half the total approvals relate to undertakings in the Highlands and Islands. The number of applications received from the Highlands and Islands up to 30th June—I do not think that the hon. Gentleman will know this—is 58. Of these, 19 have been approved, and six rejected. The remaining 33 are still being examined.

Mr. J. Grimond (Orkney and Shetland)

Can the Economic Secretary tell us the value of the money offered by D.A.T.A.C. to the Highlands and Islands?

Mr. Erroll

I am just coming to that. I had anticipated the hon. Gentleman's interest in the matter, which is not altogether shared by other hon. Members on those benches.

The total of assistance offered in the 19 successful cases is £174,300, of which £7,750 is in the form of annual grants. This assistance is likely to produce 425 new jobs in the Highlands and Islands.

Mr. Rankin

As many as that?

Mr. Erroll

Yes, 425 new jobs in the Highlands and Islands.

The aim of the Act is expressly to help to relieve unemployment and not particular industries, and the assistance which has been offered is, therefore, not classified according to the amount given to individual types of business. The Act has been framed to allow assistance to be given to all kinds of trade or business which will help to relieve local unemployment. The assistance offered to Scottish businesses covers a representative range of activity including fish marketing and processing, tweed weaving and textile manufacture, joinery and building, a sawmill, tailoring, light engineering, hotels and tourist amenities, and a garage.

Over the period of rather less than a year during which the Act has been in force, the results suggest that it has a useful function to perform in Scotland, and particularly in the Highlands and Islands. The assistance provided helps to ensure that sound projects capable of relieving unemployment locally are not shelved because of inability to raise capital from the normal sources of finance. Of course, I must point out that the Treasury can give assistance under the Act only if applicants produce sound proposals which meet the statutory conditions for assistance. We expect a little response from those who are to benefit.

My right hon. Friend the President of the Board of Trade, with the help of his regional officers, is doing a great deal to make known the assistance which is available. A leaflet describing the scheme has been very widely distributed and all responses and inquiries are followed up rapidly.

Mr. T. Fraser

One would think that this was a new scheme. It has been in operation since 1945. All that the Act passed last year did was to extend the facilities to high unemployment areas outside Development Areas.

Mr. Erroll

If the hon. Gentleman had studied it in more detail, he would have seen that it did very much more than that. It enabled assistance to be provided for all sorts of businesses and industries which could not have benefited under the 1945 Act.

Mr. Fraserindicated dissent.

Mr. Erroll

Yes it did. The results which I have been stating go a long way to prove how valuable this extension of the old Act is proving to be. While the scheme is wide enough to finance large and spectacular projects, I believe that its main achievement—a very valuable one—will be to help small and medium-sized projects, mainly situated in remote localities, whose unemployment, although not very great in total, represents a large percentage of the local population.

I thought it worth taking up the time of the House for a few minutes to explain the workings of the scheme in full detail and to show, particularly, what great use has been made of the scheme in Scotland. It is an important measure of help which has not hitherto been available in the form in which it is now available, and it provides added evidence to show that the Government mean business in what they say.

Mr. Fraser


Mr. Erroll

Yes, we mean business. I say quite frankly that nobody can pretend that it is easy to raise the level of employment in Scotland to the level we should all like to see. Successive Governments have had this difficulty. But we are quite sure that it should not be impossible. Diversification of employment and industry remains our continuing policy. We are prepared to introduce new methods where we think they are appropriate, as exemplified by the D.A.T.A.C. scheme. We believe that a judicious combination of Government assistance and private enterprise can make our policy a success.

4.50 p.m.

Mr. Cyril Bence (Dunbartonshire, East)

It is now almost eight years since I became a Member of this House and each year since then I have listened to this annual debate on industry and employment in Scotland. When I first came to the House and started to put Questions to Ministers I was told that one could question a Minister only if he was responsible for the matter to which the Question related. Therefore, I assume that the Government are responsible, and accept responsibility, for industry and employment and for the social and economic conditions of the people of Scotland. That is a very big responsibility.

For a number of years now we have had an extension of the process, started under a Labour Government, of encouraging and assisting industries in this country. While some expansion was taking place in the south, we never had assistance in Scotland and Wales which suffered badly between the wars. It seems that now, fourteen years after the end of the war, we shall have to create throughout Scotland and Wales National Assistance Board local offices with two entrances, one for the ordinary citizens and one for private enterprise. That seems to be the pattern. The extraordinary thing is that in the eight years during which the Government have been in office, on balance, more industry has moved out of Scotland than has come in. Let us be fair about this. We are concerned, especially in Scotland, with economic activity whoever may be responsible for it. But there has been a retreat of economic activity from Scotland and a good deal of it has been withdrawn by the Government.

This Government have sponsored the removal from Scotland of economic activity. They have taken the Royal Ordnance Factory at Dalmuir. All the work which was done at Dalmuir is now done in the south. It is no use telling me that another Scottish company has taken over, because this transfer of economic activity is happening within Scotland. It is not bringing in new activity.

There is the case of Rosyth and the torpedo factory at Greenock. The new activity there represents a transfer within Scotland. It is not a case of bringing in new economic activity. In fact, as fast as these transfers take place, some industry goes out of Scotland, and the rate of disinvestment is tremendous. I have here a list from July, 1958. I could produce a much bigger one, but I have this list which dates from July.

Mr. E. G. Willis (Edinburgh, East)

Read it.

Mr. Bence

It is a terrific list.

Mr. Willis

Never mind, read it.

Mr. Bench

There is the Blacknes Engineering Works at Dundee; John Honeyman & Company, Cupar; Sanquar Brickworks; Clyde Paper Company, Milngavie, and the railway workshops at Inverness. This is all disinvestment from one organisation to another. It is all work being taken out of Scotland. Wick-man Hillington have gone back to near Coventry. J. and E. Hall, Limited, will take over Thermotanks in Glasgow. W. D. Marcus, Hawick, has been taken over by Boardman Mander. What is to happen there? Those of us who have spent our lives in industry know that when one company takes over another, especially a weaker company, it is in order to wind it up. If the other company is stronger, there is an amalgamation.

I understand that the Burntisland Shipyard is closing down. According to my information Glasgow Railway Engineering has been taken over by Beardmore Axles to be wound up, and Beardmore Axles is controlled by Beardmore's.

My information is that Yorkshire Tar Distillers is making a bid to take over Scottish Tar Distillers and to concentrate all the tar distillery work in York shire, near Leeds. I understand that the chairman and vice-chairman of the Scottish Gas Board are directors of Scottish Tar Distillers and if the deal goes through, I have no doubt that they will become directors of Yorkshire Tar Distillers. Here we have a Government in office—

Mr. George Lawson (Motherwell)

Has my hon. Friend finished his list, because I have here the case of Hurst Nelson and Company, at Motherwell, employing more than 600 men, which was taken over by Charles Roberts and Company, of Wakefield. It was said at the time that they would make a better firm of it, but it is now closed down.

Mr. Bence

I am glad my hon. Friend mentioned that case. It is the last but one on my list. I have eliminated a lot and I was proposing to eliminate that one, because I felt sure my hon. Friend would mention it if he had an opportunity to speak in this debate.

There is the Crown Cork Company of Scotstoun. That has gone, with 600 workers redundant. So we have the extraordinary picture that during the last eight years this Government have tried, by legislation and all sorts of inducements, and by extending the activities of the National Assistance Board to investors, to get industry to come to Scotland; while at the same time they have been watching industry go out of Scotland. As I have said once before, we have never had such comings and goings in the history of this country since the grand old Duke of York marched 10,000 men up the hill and then marched them down again.

The Secretary of State for Scotland (Mr. John Maclay)

The hon. Member is making an interesting speech, but I think it would be useful if he made clear whether what he is saying is based on speculation or fact. Some of the things he has said are facts, but is not some of this speculation? Will the hon. Gentleman say whether it is speculation or fact?

Mr. Bence

There are variations. In some cases, as the result of a take-over, there has been redundancy. In other cases firms have closed down, and the machinery has been removed. I said that. I do not wish to go through it all, but I have here details of companies where in some cases there were redundancies. In one case they amounted to 140. In another the factory has closed completely. The cases vary, but every case represents a decline in economic activity, and that is the point. Not one of these firms is expanding. They are all declining and redundancies are created. The economic activity is being reduced.

I could mention the Inverness Railway Workshops as another case. I have a statement here which was issued by the general council of the railway trade unions. At the top of the second page appears this sort of statement by the British Transport Commission: Railway workshops will continue to be used for the manufacture of equipment and components for which they are laid down. Many of these workshops are in the same condition as they were a hundred years ago. In other railway workshops and establishments in the south of England modernisation is going on, but apparently in Scotland these workshops will be maintained as they are now laid out. In such condition they are hopelessly inadequate to carry out the repairs, maintenance and servicing, and the manufacture of modern railway equipment. It seems to me that the British Transport Commission is going in for modernisation down south and "paralysation" in the north. If we retain what has been in existence for over a hundred years we shall certainly paralyse the show.

After eight years in office it is fantastic for the Government to say that they are doing everything they can to induce more economic activity in Scotland when their Parliamentary institutions are failing to do anything to expand economic activity and in fact are allowing conditions to persist which may result in a decrease in economic activity.

Quite honestly, I do not believe that the social and economic problem in Scotland can ever be solved by private enterprise as we understand it. In speech after speech, hon. Gentlemen opposite continually emphasise—they may as well admit it—that they have come to the realisation that private employers or private industry associated together under the company laws do not operate for the purpose of solving social problems but for the purpose of making money legitimately. I admit quite frankly that engineers, scientists, chartered accountants and financiers may get together and form a limited liability company out of which they make money and that by so doing they may make a contribution to social welfare and well-being. But one cannot expect private enterprise to establish itself primarily for the purpose of solving a social problem. That is primarily the responsibility of the Government and not of private enterprise.

Many of the problems with which we are faced have admittedly arisen out of the laissez. faire system of the nineteenth century. There is the imbalance of population in different parts of the country. All the economic forces tend to compel private enterprise to make that imbalance worse.

Is there any hon. Member with money to invest who would invest it in Scotland in preference to investing it down South?

Mr. Michael Noble (Argyll)

I would.

Mr. Bence

The hon Gentleman is different from a good many other people. He has his heart in the Highlands. He has some of his money in his sporran, but the vast majority of bankers and financiers in Scotland have their money not in their sporrans but in the hip pockets of a pair of striped trousers in Lombard Street, London. I am not blaming them for it. Naturally, that is how they work under commercial law, and now they come along for help through the National Assistance Board which we are setting up for private enterprise. We want them to solve the social problems which they have created and we give them National Assistance with which to solve it. We tax them and everyone else to get the National Assistance to give to them, and as fast as they go up to Scotland others come out and the problem is as bad as ever.

This is a chaotic system. Obviously the only way in which we can solve the social and economic disequilibrium in the country is by public investment in those areas which are suffering from it.

I know one manufacturer, I know him very well, who is established in London. His company is to build a factory in Manchester. Here is the terrible dilemma in which the company finds itself. It has speeded up production in its London factory, but what it gains by its new techniques it loses by the choking of the railways and roads in the London area. When the company's production engineers work out the processes in the Manchester branch they discover that, owing to the high density of population here, for that plant to be economic it has to be sent back to London. That means that after having had a job to get it out the company has another job to get it in again. That is the problem with which we in this small island of 50 million people are faced.

The Economic Secretary to the Treasury said that a great asset to Scotland is its hard weather. Is he thinking of full employment for plumbers and snow shifters on the roads in winter? Is he hoping to help Scotland by heavier snowfalls and more frost?

Mr. Erroll

I am very sorry that my little joke went rather astray. Apparently my right hon. Friend the Chancellor had similar trouble at Elgin. All I was pointing out was that the hard winter which is normally a disadvantage was in the best interest of the tourist industry, which I think is something that should be developed.

Mr. Bence

God forbid that tourists should be attracted to Scotland at the great disadvantage of the rest of us who live there. It may be all right for the hon. Gentleman to go skiing in the Cairngorms, but not at the expense of my having to dig myself out of my bungalow.

To return to a more serious note. Members of my own union are affected by this problem. Many engineers will have to go south. Thousands of them in the last five years have been forced to leave Scotland to work for various enterprises down south, from London down to Plymouth and Portsmouth and up as far as Manchester, Northampton and Bedford. I receive letters every week from engineers who have been forced out of Scotland.

I could go on for a long time pointing out some of the many ill effects on Scotland which though not felt today may be felt in twenty or thirty years' time. When economic activity falls in a given area the facilities for training the technologists of the future fall as well. They decline within the industry itself. I do not say that they decline in the educational institutions—they certainly do not—but we get a decline within the industrial institutions when there is a decline in economic activity. Many of us in the engineering industry experienced this between the wars.

I know that some people in Scotland, and no doubt some in this House, think that the Secretary of State has not been trying within the Cabinet. I would not say that he has not been trying. I think that he really tries. But most of the Scottish Members are howling. The Scottish Industrial Council for Industry is howling. All his fans in Scotland are howling at him. They are like the fans at a football match. They do not howl for the centre forward to be dropped because he is not trying to get goals, but because he has not scored any. That has been the position of the Secretary of State and of his predecessors since 1951.

Mr. Grimond

He has been transferred.

Mr. Bence

I do not think that he has been transferred. Although I am not a Rugby fan, I know more about it than about Association football, and therefore I am not au fait with the terms.

Mr. W. R. Williams (Manchester, Openshaw)

Transferred at the end of the season.

Mr. Bence

Whether it was a free transfer or a sale, I do not know.

With all due respect to the Secretary of State as a person, I must say that, despite all his efforts and those of the Department in Scotland, and even of the Chancellor of the Exchequer and the Prime Minister as well—reading the Glasgow Herald, the Scotsman and other papers one would question whether or not they had achieved the necessary economic activity in Scotland—that activity today is less than it was ten years ago. The number of employers is smaller. Indeed, the industrial capital which has gone into Scotland in the last fourteen years has been, in the main, American capital. It is certainly not British.

In the last debate which we had on this subject the Secretary of State said that a good deal of this trouble in Scotland must be solved by the people of Scotland themselves. I could not agree with him more. But which people? Can the ordinary man in the street solve the problem? Surely the Secretary of State meant the financiers, the heads of big insurance companies and the big business chiefs in Scotland.

He must have meant those who take more savings per head of the population in Scotland then any others in the British Isles. But do they invest in Scotland? Of course not. They invest as little as possible there. The rest comes south. These are the people to whom the right hon. Gentleman appeals, but they have only to get a take-over bid from Firth Brown's of Sheffield or some other great concern down here to get out and take their profit, notwithstanding the fact that Scottish industry may go out of existence.

After eight years of this annual ritual—as I now regard it—this academic debate on industry and employment in Scotland, we still have this attempt to create the idea that private enterprise can redress the social imbalance in the different parts of the United Kingdom. The idea that one can get near-full employment in Scotland only if there is over-full employment in London and the Midlands is not good enough for me. I am a Welshman who comes from England.

Why should we in Wales and Scotland have to depend on there being 30 men after 100 jobs in England before we can see 20 jobs for 20 men in Scotland? To have to depend for full employment in Scotland on over-full employment further south makes us second-class citizens. It also lowers the opportunities our children have of different forms of occupation and training. It means that we have a standard entirely different from that enjoyed by people south of the Border.

London is a terrific magnet. With the fall in employment in Scotland, the people there take that single ticket from Glasgow Central Station, or Waverley Station, Edinburgh, and come here. They find that the wages are better, and they never go back. The problem gets worse. The gulf between the two employment standards is wider in 1959 than it was in 1952. D.A.T.A.C. does its best—we know some of its difficulties—but we shall not narrow the gap by financing people to go back north. As the gap widens, those people will demand an ever-bigger price to help solve the Government's problem of this social disequilibrium.

I know that it is a waste of time to appeal to a Government who have come to the end of their term of office. They will go out of office soon. After all, they have had eight years of it, and have failed completely. They know the social and economic problems just as well as we do, and they know that private economic enterprise cannot solve them. They know that it can be done only by the use of the resources of the whole of the community—of the taxpayers.

They are now weakening a little and are calling on the taxpayers, but they should have thought of all this years ago. They should have had these ideas long ago, in which case we might not now be facing this problem. For this Government, it is too late. All I hope is that when we take over—as I think we shall in the very near future—we will at any rate make a start to redress the frightful economically and socially unbalanced society in which we live at present.

5.15 p.m.

Major Sir William Anstruther-Gray (Berwick and East Lothian)

I agree with one thing that the hon. Member for Dunbartonshire, East (Mr. Bence) said, and that was when he stated that he was satisfied that my right hon. Friend the Secretary of State for Scotland did at least try. My experience is that my right hon. Friend tries very hard, and not just in a vague and general way. He takes up individual points with full knowledge, and I wish to take advantage of that fact to raise this afternoon, very briefly, one or two points that affect my constituency. I am quite confident that he will know the problems that are involved, and I very much hope that he will be able to give me a reply.

First, as he will know, I represent East Lothian, and the town of Dunbar is in East Lothian. I do not ask for any special preference for the town—I shall not pitch my note so high. All I shall do is to ask the Government not to make Dunbar's problems more difficult than they are. We have been trying to attract industry to Dunbar, and it was thought that it might be possible for the town council to buy the Castle Park Barracks as a possible site for new industry. Negotiations for the purchase were entered into with the War Office, but it proved difficult to come to terms. I have now heard, to my concern, that the War Office may dispose of this site to the Scottish Office, and that the Scottish Office may use the site for a new home for juvenile delinquents. A detention centre is how I would describe it.

I do not say that such a place is not very necessary somewhere. We all want to do the best we can to try to correct young people who have gone astray, but when we are debating unemployment one must take into account the effect that such a place will have on the employment which Dunbar is able to provide. Very prominent amongst the forms of employment there is that connected with the entertainment of holiday traffic. It must be obvious to my right hon. Friend and to anyone who considers the matter that it is not at all a good attraction to a holiday town to have within it a juvenile delinquents' detention centre. When parents are thinking where to take their children for a holiday, they do not want to go near a centre of that kind.

It is difficult to over-rate the difficulties that will arise. I do not suppose that the juvenile delinquents would escape, but this site is in the centre of a town and quite near to the harbour and to the swimming pool. This is not at all a good way to encourage the holiday spirit in people, nor is it at all kind to the juvenile delinquents. It is not kind to put in close proximity those enjoying their holiday—laughing, and swimming and splashng about in the swimming pool and enjoying themselves generally—and those who are suffering strict discipline. I think that I have said enough to let the House and my right hon. Friend know that there is a good deal in what I say, and I ask my right hon. Friend now not to go so far as to have a public inquiry but to give a decision on this project before it is too late.

There is another and more general matter that affects all who represent constituencies that may not be in the depressed areas. In saying that, I know that the hon. Lady the Member for Lanarkshire, North (Miss Herbison) and her hon. Friends will not think that I do not fully appreciate the difficulties in those areas where there is great unemployment, and where pits have gone out of commission. One pit has closed down in my constituency, but the problem there is no so severe as in other areas. In this matter I urge the House to keep a sense of balance.

All areas in Scotland want to develop new industries. If it is made too clear that the only places where a new industry can be given preference or any advantages are those in Development Areas, and that no advantages at all will go to places outside Development Areas, it will be very difficult for a county like East Lothian to attract its share of new industry. It might be said that that is as may be, but let us bear in mind that the Scottish Office has, rightly I think, because I voted for it, produced a Bill to allow the overspill population of Glasgow to be distributed throughout Scotland. Haddington is one of the burghs which has agreed to take some overspill from Glasgow.

I would say to my right hon. Friend that provided that employment goes with the overspill population of Glasgow, well and good, but I hope that at all costs he will avoid sending the overspill people from Glasgow into Haddington before we are quite sure that industry will be there ready to give them employment. It must also be industry which has a very good chance of continuing for a number of years, and not one which there is the slightest danger may break down and cause these people, who have shifted their homes to another place, to be unemployed and unhappy outside their former surroundings.

I am speaking very briefly, because I see on both sides of the House a large number of hon. Members who want to speak. Having been a Scottish Member for a long time, I wish that we could get back to the old system on Scottish Supply Days, when we all agreed to make short speeches, as a result of which we were all able to take part. It was much better for our constituents and also for ourselves.

Let me mention another town. I am sure that my right hon. Friend will know this problem, too, as will his Joint Under-Secretaries. It is the fishing town of Elyemouth in Berwickshire. I know that fishing is not specifically among the subjects that we are debating today, but employment is, and so is unemployment. My right hon. Friend will know that although Eyemouth is a most suitable port in almost every way, there is one very serious snag, which is that the harbour cannot be used for 24 hours out of the 24.

At certain low tides, it is not possible to get either in or out, and this is a very serious shortcoming, which I am sure modern engineering can perfectly well overcome. Great efforts have been made to find a plan that would be satisfactory. The Scottish Office has a plan now, and the Harbour Trust has approved it, although there are still details to be gone into before it is completely agreed between the two bodies. At the end of the day, of course, it will be expensive, and I cannot pretend to my right hon. Friend that it is not so.

Suppose a new harbour is built. Suppose we get a harbour capable of use every hour of the day, both in and out. It certainly will make fishing boats use the harbour more than they do at present, and that could have repercussions on the town itself. It might give us a greater chance of a freezing plant, fish meal factories, and perhaps also canning, and might allow a certain coastal trade to develop. I do not want to put the claim too high, but it is clear that this would be a good plan. It is quite clearly a plan in which there is nothing new, with nothing extraordinary about it. It is obvious to everybody that the town would be better for having a 24-hour harbour.

One hears a lot of schemes put to the Government by hon. Members on both sides hoping, and rather pretending, that they will be very effective. This is a scheme which will absolutely certainly do some good. I therefore ask my right hon. Friend, since he knows that Berwickshire is a county with a small population, a small rateable value, and is hard put to it to keep pace with modern administrative costs, to give the most sympathetic consideration to that scheme for Eyemouth harbour.

5.25 p.m.

Mr. John Taylor (West Lothian)

I will not comment on what was said by the hon. and gallant Member for Berwick and East Lothian (Sir W. Anstruther-Gray), except to say that I think he is optimistic in imagining that another port is likely to open for general traffic on the east coast of Scotland so near the existing port of Berwick, and with Leith just round the corner, so to speak. His hopes will be just as likely to be dashed as were my own in the other part of the county, West Lothian, which I represent, when I tried to save Bo'ness docks from extinction.

The one fact which arises at this stage of the debate is that, in spite of all the efforts which the Government are making—and it would have been a most astounding situation if, in Scotland, any Government of the day had made no efforts at all—to bring new employment, we are still confronted with the fact that our unemployment rate is double that of the United Kingdom. This situation has grown chronic. It is a disease to which we have almost become accustomed, but we must ask, as so many hon. Members have asked so many times, whether we must always continue to be in this drastic and inferior position. Can we be content with the grim fact that for every unemployed person in England there are at least two in Scotland, at any time, slump or boom? Must we be content always to shrug our shoulders and say that it is a pity, but that, owing to Scotland's preponderance of heavy industry, it is just one of those things which, like the weather, cannot be helped, and that what cannot be cured must be endured?

The time has come when we must say "No" firmly and definitely to all these questions, because there is no logical reason or justification for this condition of double disability for Scottish workers. If it is really true, and I doubt it very much, that it is the preponderance of heavy industry in Scotland which causes this situation, then clearly the Government should take action to adjust the industrial balance.

In my opinion, what is wrong is not the over-reliance on heavy industry, but mainly, simply and clearly, the lack of sufficient industry of any kind to provide full employment for the Scottish people. There is just not enough industry in Scotland. That is the problem. We have a laissez-faire economy in the United Kingdom at the moment which produces this astounding spectacle—this really crazy state of affairs—in which areas around London are chock-a-block with factories and firms are fighting for space to build more. We have local authorities in those areas at their wits' end to find room for the houses, the schools and the hospitals to cope with the ever-growing numbers who flood into their areas to work in those factories.

At the same time, in large areas in Scotland, we have stagnating industry, derelict factory buildings, a gradual but relentless slowing down of the pulse of industry and a growing number of gaunt, empty, silent and ugly industrial establishments, crumbling monuments to a decade of lost opportunities—lost because of the Government's failure to plan our national resources.

That is not an over-painted picture. There are areas in Scotland where this is happening. There are hon. Members opposite who well know this; indeed, we have just listened to a speech from one who has admitted that his area is not severely affected and who rather apologised to my hon. Friend the Member for Lanarkshire, North (Miss Herbison), recognising that the problem in her constituency is vastly different. The only complaint which the hon. and gallant Gentleman could level at the moment was by entering a caveat against the use of barracks as a home for juvenile delinquents. I agree with him. I do not think a former barracks is a good place for juvenile delinquents. That was one of a number of comparatively minor problems of that nature which the hon. and gallant Gentleman mentioned. But take a constituency like mine in which there has been no industrial development at all for ten years. On the contrary, there has been and is at the moment industrial decline and decay.

Due to what I can only describe as the stubborn stupidity of the Treasury—and I am sorry that the Economic Secretary to the Treasury has now gone from our midst—the shale oil industry has been forced to contract to half its former size and continues to exist only by a near miracle. In a neighbouring constituency, coal mining is a contracting industry. The viewpoint of those still engaged in it is met, on the whole, with a cynical unconcern, particularly by many Ministers who ought to view with alarm the waste of manpower and skill consequent on the decline of a once great industry on which the industrial strength of our nation has so long depended.

This week in my constituency the dock and harbour of Bo'ness has closed down. As one who once earned a precarious and laborious living as a dock labourer, I cannot convey to the House the feeling of sadness and desolation engendered by the knowledge that a once busy harbour has reached the end of its service to the country, that the cranes will no longer rattle their loads in and out of the holds of the ships, that ships will no longer cross the harbour bar, that the dock will silt up, be stripped of its equipment, its buildings left to the rats and to decay, and that the dock gates will be closed and strapped so that no vessel will ever pass between them again. I had intended to go to Bo'ness on Tuesday to attend the last rites, but at the last minute my heart failed me. I thought it would be too sad a spectacle.

Also in my constituency we have a lively and enterprising engineering industry, but it has to scour the world for orders in a never-ending struggle to maintain continuity of employment, and it is still never able to guarantee to its workers that they will have full employment all the year. It is never confidently free from that kind of hidden unemployment known as short-time working. There are derelict pottery and moribund hosiery factories. All these circumstances, and others which I could mention, of a general and gradual decline in the major industries as well as in some of the minor ones have been taking place over the last ten years. Tradesmen and shopkeepers of all kinds are alarmed because of falling receipts over the counters, and overall there is a general atmosphere of industrial ebb tide.

In those circumstances, I cannot enter this debate today or consider the Government's White Paper with any detached equanimity. I cannot be expected to listen to the Government's propaganda in the Press, on the radio, on posters and in this House with anything but cynicism, if not anger. For many of my constituents the claims of prosperity and boom are a fraud, a sham and a lie. Local authorities, notably the county council and Whitburn Burgh Council, have joined with me in trying to persuade and urge one Ministry or another to co-operate in reversing this decline, and trying to get across the message that there exists a special responsibility to avoid the creation of a graveyard area. All these endeavours have hitherto been fruitless.

Now the county council has decided to build factories, if it can find tenants for them. Once more I urge the Government, in this enterprise, to try hard to help the county council to find the tenants, to give a helping hand with more urgency and to steer industries into this and surrounding areas, for not only my constituency but neighbouring constituencies are similarly affected.

We are asked in the Motion to take note of the Government's White Paper. The one fact of which I can take note is that it gives no indication that there is any policy for tackling such problems as exist in my constituency and those similarly situated, those which have a declining industry with no alternative employment and no immediate indication that there will be such alternative employment in the future. I am not advocating that we ought to buttress artificially industries of past generations whose products, operations and methods are being by-passed in the current technological revolution. I am not advocating that a dying industry should be kept alive if there is no further need for it, but it is my submission that in these days of change the Government have the duty so to arrange matters that no area becomes an industrial graveyard.

Old industries should be replaced before they die, and some regard should be had to the ancillary and human problems created by permitting derelict areas to develop. The ancillary problems are those of shopkeepers and others who depend on local industry. The human problems are those of the families of industrially displaced persons in areas with no alternative jobs to offer them hope of a restart in life. I will not dwell on the human problems because it is so difficult to remain objective in one's approach if the emotions of compassion or indignation are roused. I have every right to feel indignation at the way my constituents, and others like them, are being treated.

I would mention in passing the financial aspect of this matter. Surely in the long run it is cheaper to incur the cost of steering new industries and building advance factories than to have a large section of the community drawing unemployment benefit and National Assistance, and drawing on public funds of one kind and another, apart altogether from the fact that if we find jobs rather than National Assistance people's human dignity is preserved. I recognise that the Government have no power except that of persuasion, but I urge that this power of persuasion is used with extra vigour and urgency in areas of this kind.

The D.A.T.A.C. yardstick of 5 per cent. unemployment over a period is all very well, but in small industrial communities where there is often a large group of small towns, such as in my own constituency and in the constituency of my hon. Friend the Member for Lanarkshire, North, an employment exchange does not serve only the population of the town in which it happens to be. There is a hinterland of residential and agricultural population which is included in the total number of employed persons in the area, and to register a figure of 5 per cent. in a town it is necessary to have 7 per cent. or 8 per cent. in the town that is affected. Therefore, this yardstick is not always fair, and some regard ought to be had to the communities as communities, rather than areas and districts.

May I refer to another point which is germane to the debate? It is the fact that hon. Members on both sides of the House have had representations from the Scottish paper-making industry in the last few days. This industry is alarmed at the possible effect on the industry of the proposed Free Trade Area agreement. Because of the circumstances which I have outlined, I am naturally very much concerned that there should be no additional unemployment in my constituency, particularly in industries which hitherto have been fairly steadfast in their employment potential. Any additional unemployment of any kind naturally fills me with alarm, even in prospect.

There are three well-known paper-making firms in my constituency. The factors which those firms have brought to our notice—and I think that I speak for hon. Members on both sides of the House—are that the products of the Scandinavian paper and board factories would remain subject to duty in the six Common Market countries but would be freed from duty in the United Kingdom. The result of this would be a considerable increase in imports of paper and board to the United Kingdom and a consequent decrease in indigenous production.

Industries likely to be adversely affected by such treaties have been told in earlier debates that they should adapt their buildings and plant to other uses, but the plant and machinery of a paper mill cannot be adapted for any purpose except that of making paper or board, and that advice is therefore useless in their case. If mills in my constituency are so affected, there is no alternative employment in the area for the people displaced. The mills are extensive users of coal and such other materials as chemicals, felts and machine wire, and the effect will be widespread over many other industries in Scotland.

Their case, therefore, is that the result of such an agreement will not be freer trade but restricted trade for the paper-making industry, which is so extensive in Scotland. I understand that representatives of the industry are to meet the Paymaster-General next week and I have no doubt that they will put their case to the Government, but perhaps I may express the hope that the Secretary of State will impress upon his Cabinet colleagues that this industry is important in Scotland, and not merely in my constituency, and that there is a need for such safeguards in any agreement or treaty as will avoid serious effects on an industry of such value and hitherto of such pride to Scotland, because we have always been proud of the high quality of the products of our paper mills.

I content myself with that, because there are obviously many other hon. Members wishing to speak in the debate. I make a plea, again, for extra, urgent and carefully detailed attention to those areas where the industries are in danger, where employment is less than it was and is steadily growing less every year, and where no alternative work is available. I think that such areas merit additional, careful and urgent attention, and I hope that it will be given to them as one of the results of the debate.

5.43 p.m.

Sir Thomas Moore (Ayr)

It has been very interesting to listen to the first three speeches from the Opposition. First, we heard from the hon. Member for Edinburgh, Leith (Mr. Hoy), who painted a broad picture of industrial conditions in Scotland but became so exaggerated and so grossly distorted in his picture that he ceased to carry any conviction. Next, we heard from the hon. Member for Dunbartonshire, East (Mr. Bence), who was more concerned to concentrate on an attack on private enterprise, ignoring the fact that it is only through the vitality and success of private enterprise that we can maintain our high standard of living.

Mr. Rankin

Heaven help us.

Sir T. Moore

At times the hon. Member for Dunbartonshire, East did not seem to be fully aware of the facts.

The third speaker was the hon. Member for West Lothian (Mr. J. Taylor). His was an entirely different type of speech. The impression which he left on me was one of sympathy for his constituency and for those who were feeling the effects of and fall in employment and the halt in industrial expansion. I propose leaving it to my right hon. Friend to deal with other speeches and, after some years of comparative quiescence on the subject of Prestwick Airport, to address my few observations to that subject. I hope that the House will be patient with me in dealing with it once more.

I do not propose to refer to the question of the tunnel versus the loop road in connection with the main runway, since that is both confused and controversial, and in any case it will have little effect on either industry or employment in Scotland. I will, therefore, concentrate my remarks on the present position of Scottish Aviation Limited.

As the House is aware, or, at any rate, as Scottish hon. Members are aware, this company is the only design and manufacturing unit for aircraft in Scotland. It was created by our former colleague, the Duke of Hamilton, and his friend, David McIntyre—the first conquerors of Mount Everest—just after the last war, when their operational enterprise in Scotland and elsewhere had been crushed by nationalisation. Through the fortunate acquisition of a brilliant and imaginative designer they produced the Prestwick Pioneer, a single-engined machine, later followed by the Twin, which, as its name implies, has two engines. These machines had at the time of their design and manufacture the unusual advantage of being able to take off and land in practically their own length. They were and are, therefore, particularly suitable for use in jungle, forest and desert operations, or wherever no airfields of any kind were available.

I know that I am repeating what is old history to hon. Members, but I want the House to appreciate the background to my final few remarks. After many set-backs, these aircraft achieved recognition by the Aeronautics Board and were also accepted by the Ministry of Supply, as suitable for the Services. Since that time 44 single Pioneers and 70 Twins have been manufactured and sold, some to the R.A.F. for service in Malaya, Borneo and elsewhere, some direct to colonial Governments and some even to foreign Governments.

As a consequence, the number of people employed at Prestwick by Scottish Aviation Limited rose to 2,400; and what appeared to all of us to be a flourishing industry had been established, a fact of which Scotland was properly proud. Here I want to pay tribute—even though this may not be palatable to the Opposition—to the Government and their predecessors, in particular the Treasury, the Ministry of Supply and the Secretary of State for Scotland, for the constant interest, encouragement and tangible assistance which they gave and have continued to give to the company.

Unfortunately, sad times have come upon this gallant little enterprise. It is difficult precisely to state the reasons, except that other manufacturers have recognised the unique advantages of the Pioneer. Therefore, possibly through strong competition or possibly through the untimely death of that amazing personality and salesman, David McIntyre, orders have fallen off to such an extent that this company has now only two aircraft in production and only seven on order. The tragic and, I suppose, inevitable result is that 600 employees, as the hon. Member for Leith said, have already been put off and this very day 400 more are due to receive their notices.

I would impress on the House, although no doubt some hon. Members already know it, that among these men are some of the most highly skilled craftsmen in the industry, whether in Scotland or England. At first, when orders began to fall off, which was about a year ago, it was possible for men to find equivalent employment in England. Although, naturally, they were deeply distressed at having to uproot themselves, with or without their families, many went south of the Border. Today, unhappily, owing to a general recession in the aircraft industry, even that avenue for their further employment has been closed. The ultimate result is that our only native industry of its kind in Scotland, excellently managed as it is, with first-class industrial and labour relations and a splendid team of workers, designers, engineers and draftsmen, is in danger of extinction.

What can be done about it? Steady orders for two machines a month would be needed to keep even the reduced staff fully employed. With the original number of employees the capacity was four machines a month, and orders for that number—one a week—would be required if the firm is to get back to its old standard of employment and output. It is not a great number with the world as its market, but it means a lot to Prestwick and Ayrshire and, indeed, to Scotland as a whole.

The Secretary of State for the Colonies has done much to bring to the notice of the territories over which he has authority the advantages of the Pioneer for use in those countries. The Secretary of State for Commonwealth Relations has also done the same with regard to the countries with which he has contact. The Minister of Supply has proved a most helpful channel for the Services, while the Secretary of State for Scotland—and I should like to pay a special tribute to him here—has been a tower of supporting strength, although he has been somewhat circumscribed in his efforts by the statutory tentacles which were spread over B.E.A. in Scotland when nationalisation first came into operation.

These, however, are all individual efforts by individual Ministers and Departments. I cannot help thinking that if all these eager, ardent spirits in the Government were brought together in a Government committee presided over by the Secretary of State for Scotland, plus, possibly, the Board of Trade, and they could meet regularly and actively with all the authority of the Government behind them, they would find a field or fields in which the sale of this aircraft could be stimulated and guided. If they could find a way of furthering the sale of these machines they would, I am convinced, save this pioneer company and its Pioneer planes. I believe that it is within their power to succeed, and if they did they would certainly earn the deepest gratitude of the people of Scotland including, I venture to say, that of the hon. Member or Ayr.

I therefore beg the Government to give us some hope in this matter.

5.56 p.m.

Mr. G. M. Thomson (Dundee, East)

I sympathise with the hon. Member for Ayr (Sir T. Moore), and even more with the workers in the aviation industry whose difficulties he has described, but if the hopes of the workers in the aviation industry in Prestwick depend on the ardour and eagerness of Ministers then the hopes of the hon. Gentleman are not likely to be fulfilled.

I must also say that one of the compensations for sitting through debates on Scottish industry is the eternal spectacle of all hon. Members opposite—the apostles of private enterprise on the political platforms outside—coming here and, in speech after speech, explaining, I believe irrefutably, that the only hope for their constituents and for the prosperity and full employment of the areas which they represent is increased Government intervention and much more Government planning. These debates prove, if they prove nothing else, that the Socialist case in Scotland should be accepted by everybody, no matter what they declare their own political allegiance to be.

It has been said by the Economic Secretary that Scotland's difficulty is that employment continues to run at twice the United Kingdom level. The Minister rather gave the impression that this was something which had continued evenly, whatever Administration was in office. I think that there are two misconceptions about this which the Minister did not make completely clear.

First, although unemployment today in Scotland is still running at about twice the United Kingdom level, it is at a far higher level than it was during the period of the Labour Government. We have had the spectacle of the Chancellor giving us what is now the Tory theme tune, namely, that Scottish unemployment has come down by one-third in recent months. Everyone in Scotland is supposed to cheer this, but what has happened is that the Tories have put up unemployment in Scotland deliberately a very great deal and are now trying to claim what credit they can out of bringing it down a very great deal less.

I got into trouble with the Secretary of State for Scotland, during a previous debate for suggesting that the Government were trying to accustom people to a considerably lower level of so-called full employment, but the events of the last few months tend to prove that what I said then was right. I do not think that many Scottish people are deceived by the Government. I certainly do not think that the 25,000 Scottish workers today signing on for the dole who were in jobs under the Labour Government will be deceived by them.

Secondly, although unemployment runs at twice the United Kingdom level, this conceals the fact that there is a steady and gradual but inexorably widening gap between the living standards of Scottish people generally and the living standards of those in the Midlands and Southern England. There is also a steadily and gradually widening gap in their job opportunities. This is the big problem which hon. Members on both sides of the House who represent Scottish constituencies must face. This widening gap is due to deep-seated and historic economic forces. There are two main forces. The first is that the old coal-and-iron basis of our economy which gave Scotland its supremacy in the twentieth century is disappearing. This is leaving the heavy industries of Scotland in a particularly vulnerable position.

The other point is this. In the words of the distinguished economist, Mr. Colin Clark, himself of Scottish descent, there is the unmistakable fact that in the industrial world in which we now live there is a strong tendency for populations to be highly concentrated in certain limited areas. This phenomenon is not confined to our country.

It is a world-wide phenomenon, but we see it particularly in the United Kingdom. More and more, the development of industry becomes concentrated in the great industrial belt which runs from London, up through the Midlands and into the southern Lancashire-Yorkshire area. I am told that the economic geographers call this a coffin because of its shape on the map. That is a most appropriate expression as far as the isolated fringe areas like Central Scotland, South Wales and Cumberland, are concerned, because the more that these forces develop, the more they spell the death knell of the hopes of people in Scotland for a decent future and for what I regard as the elementary right of every Scot, to expect that he and his children should be able to live out their lives in Scotland with decent jobs and prospects.

The question is: what can we do about this? We must not underestimate the strength of these forces. They should not be underrated by the Front Bench, either on this side of the House or on the Government side. First, there are the ordinary market forces and the fact that competitive transport costs and the like make it difficult to establish successful industries far away from the big markets of the south.

There are, however, other less economic factors, the human factors which provide severe obstacles. There is room for a student of economics to write a learned thesis on what might be called the "Economics of Convenience," the first chapter of which might well be entitled, "The influence on the location of industry of the managing director's wife." There must be a number of industries that might otherwise have come to Dundee, Greenock, or North Lanark which have not arrived there because, for some peculiar reason which I cannot fathom, the managing director's wife prefers to live in Stratford-on-Avon or Henley-on-Thames, rather than in Dundee or Greenock.

There is also the practical problem that the big industries are like the big fleas which attract other fleas to live upon them. Big industries set up a whole complex of ancillary firms which are of great practical convenience in providing spare parts and accessories. It is much easier to lift a telephone and make a local call in Birmingham than to try from Dundee to get refrigerator handles from the Midlands of England. These are difficulties which must be faced.

I want to suggest some or the ways in which these forces can be overcome. I will illustrate them by examples from my own constituency, partly because I am anxious to draw attention to these things, but also because they are reasonably representative of the kind of problem that we find in running an effective distribution of industry policy. Clearly, the basic problem is to get a big enough stick and a sufficiently juicy carrot. We must have a vigorous Government effort to stop industries going up in the congested areas of the south and a big enough incentive to attract them to the other areas. The background of this must be a climate of steady economic expansion.

I have never believed that there was any danger of our returning to the sort of slump of the 'thirties, but so long as we have a Conservative Government we will go on having the slightly more sophisticated and more humane boom and slump of recent years. This by itself makes it difficult to encourage industrialists to come to the Development Areas. It is for this reason that I put as my first suggestion to the Secretary of State that a much more vigorous effort must be made to stop the rot in the existing industries in the Development Areas.

It is much easier in some ways to save existing jobs than to create new ones. I think particularly of the jute industry of Dundee, which, fortunately, is now enjoying more prosperity. It is, however, a precarious prosperity. If at any moment the Government took a further sudden step in removing Government control from the jute industry, there could be immediate massive unemployment in that industry. The Government obstinately refuse to put the jute industry out of this agonising uncertainty. This side of the House has made a firm pledge that when we are in Government, we will continue the protection of the State to ensure continuity of employment in the jute industry and the voters of Dundee will shortly make their choice between these two positions.

I want to refer to another of the basic industries in a number of the Development Areas, and that is shipbuilding. In Dundee, the local shipbuilding yard—the Caledon Yard—is still one of the biggest employers of labour. It has now laid its last keel, there are no further orders on the order book and unless something happens during the months immediately ahead there will be steadily increasing redundancy in the shipbuilding industry in Dundee which will more than cancel out the modest increases in employment that have been obtained by Government effort during the last twelve months or so. I plead with the Government to do everything they can to stop this. If it is possible for Dundee to have its fair share of new naval orders, the fact that Dundee has this unemployment problem should be borne in mind by the Government.

I think, also, of the fact that the Government are considering making a big capital donation, a piece of lavish National Assistance, to the Cunard Company. If £100 million, or whatever it is, is to be given to the Cunard Line to assist it to build the new liners, I hope that this money will be regarded as an instrument of economic policy and used to spread jobs to those parts of Scotland where they are needed. I hope that it will prove practicable that some of the subcontracting on these liners might be done by some of the smaller yards in Scotland, including the Caledon. There are, of course, others and in Fife the same situation exists. This is a much better justification for that kind of Government assistance to the Cunard Company than simple questions of national prestige. National prestige in great ocean liners comes down in the end to subsidising the first-class fares of American millionaires and British businessmen. I hope, therefore, that something can be done in that direction.

Then there is the question of encouraging the traditional industries in the Development Areas with Government help to diversify themselves. For some time, I have urged that the jute industry should go into the paper bag business, since this is its principal competitor. I notice that two jute firms in Dundee have now decided to take my advice, but in a somewhat embarrassing and astonishing form. They have decided to set up a paper bag factory with Dundee and some Swedish capital, apparently somewhere in England. This is a good example of how some of the people in private enterprise in Scotland exercise their patriotism.

I want to know from the Government whether a serious effort has been made by these firms to get the Board of Trade to give them the necessary help that would have allowed this undertaking to have been set up in Dundee, so that the capital which has been made out of the efforts of the Dundee people should be used to provide new jobs for the Dundee people. If this has not been done, what are the Government doing about any application for an industrial development certificate for this kind of undertaking down in England? This raises important issues that could, no doubt, be found also in other constituencies.

Communications should not be underestimated as a means of attracting industry to difficult Development Areas. In Dundee, I refer particularly to the improved road communications by means of the building of a Tay road bridge and to a regular air service between Dundee and London, from Leuchars or Errol airports. These are not simply constituency points, although I make them with all the force I can command.

I think that it is generally agreed by all who have studied these problems that road communications, in particular, are a vital element if we are to keep transport costs competitive. When it comes to air transport, most firms have to maintain their sales offices down in London and it is a serious occupational hazard for an industrialist who is tempted to come to Dundee to find that he has to face two nights of travel in sleepers if he wants to conduct his business between his London and Dundee offices. These two transport factors could do a great deal to overcome some of the handicaps that Dundee faces.

Finally, there is the whole question of a really vigorous effort by the Government to overcome the general handicaps inherent in a Development Area. All the Government Departments and agencies ought really to be on their toes about these, and there is no sort of evidence that there is that sense of urgency felt by the Government. It is probably unreasonable to expect them to have it because the whole Development Area operation is completely contrary to their whole philosophy.

I would mention one small example of the kind of thing I have in mind. There is to be a new refrigerator factory in Dundee, and its construction has been started. It is a £500,000 building project. I understand that the contract for the project has gone to English building contractors although at least one of the Dundee firms which submitted tenders for the contract put in a tender within £3,000 of the English figure—within £3,000 on a £500,000 contract. I am not suggesting that these contracts should be given locally if public losses were to accrue in consequence, but I think that in a situation like that the benefit of the doubt ought to have been given to a local contracting firm, so that the maximum amount of employment and the maximum amount of purchasing power arising from this kind of project could have gone to the area itself.

I mention this not because anything can be done about this case, but because we have another big factory about to come in for the National Cash Register Company. I hope that when the tenders for that are being considered by Scottish Industrial Estates it will bear in mind the necessity of having a distribution of industry policy which is being fought on all possible fronts.

We have got to have vigour all round all the time. Our main charge against the Government is that what little they and doing now is too little and too late. They have vacillated in all these policies. It is only a year or two ago that Lord Bilsland was saying in another place that the Government had made the Distribution of Industry Act virtually inoperative.

The gap we are discussing between Scotland and other parts of the United Kingdom is fundamental and enduring. It does not merely occur and disappear and recur but is always there, and it does not appear that the Government have ever realised this. It has been said that we have been having these debates year after year and that we always say the same things. We are coming to an end of these debates, and coming to a time when we can have real hope of getting action by the Government—but not this Government. In a short time we shall have the opportunity of turning them out of office and of putting into power a party which, as part of its basic economic philosophy, believes in the planned distribution of industry and of the good living conditions which go with it.

6.12 p.m.

Mr. Michael Clark Hutchison (Edinburgh, South)

I hope that the hon. Member for Dundee, East (Mr. G. M. Thomson) will forgive me if I do not follow him exactly, because I want to draw attention to some different points. First, I find myself in agreement with my hon. Friend the Member for Fife, East (Sir J. Henderson-Stewart) in wanting a general survey of industry in Scotland and of its prospects. I believe that some such review would indeed be useful.

Mr. Rankin

It could have been useful if thought about seven years ago.

Mr. Clark Hutchison

I was not in the House seven years ago.

The body charged with making this survey should be the Scottish Council (Development and Industry). It is a highly respected and efficient organisation, and if it has not sufficient staff, outside people of the highest quality can be co-opted and some additional funds made available.

Mr. Willis

The Scottish Council has already presented a report and suggestions to the Government, and, of course, has expressed its disappointment at the Government's reception of them. The fact is that the Government did not do anything about them. Would there be any guarantee that the Government would do anything about this proposed survey by the Scottish Council?

Mr. Clark Hutchison

The survey which it has made so far is not along the lines my hon. Friend was suggesting in a previous speech.

There are some aspects which I should like to mention. All of us tend in our speeches, inside the House and outside it, to say, for example, that transport costs are things which militate against industry coming to Scotland. Are they? Railway freight charges are higher in certain instances, but sea transport around our coasts is perfectly good. We have Aberdeen, Dundee, Leith, Glasgow. All these are nearer likely areas of development in Scotland than the Midlands of England are to the coast. I should like very definite facts and figures on how much transport costs really interfere with industry coming to Scotland, or expanding.

I should like, further, to see a competent review by experts of the difference between local rates in Scotland and in England, building costs and several other matters. If we can have a table showing the pros and cons then we shall have absolutely definite data upon which we can build future suggestions and ideas.

It seems to me that Scotland has several aces in her hands. They must be played properly. For example, we have pure water, pure air, space, first-class labour, much better food than England, electric power readily available, massive possibilities for recreation and sport. All these things can be used, and they must be of interest to industry generally. So let us have all these items tabulated, and then, on that, we can base our suggestions for the future.

I have one other point to make which concerns the trading agreement between the outer Seven nations and how this may affect industry in Scotland and particularly the paper industry. We all want to see an expansion of trade. I certainly do, but I must sound a note of warning on this matter. Reduction of the tariffs would help certain industries—for example, engineering, motor cars, chemicals—but all those are doing pretty well at the moment. I cannot really support a policy, or regard it as sensible, which aids some industries which are already doing well and is likely to knock other industries around a bit, particularly paper, which is going to feel the draught of competition very much.

I would remind the House that in Scotland the paper industry is concentrated primarily on very high quality paper and papers for industrial use. There are 55 mills. They employ 15,000 people, use 1½ million tons of coal a year and provide extra employment in the chemical and transport industries. The first mill was established over three and a half centuries ago.

The Swedish people have already caused great difficulties to the industry with their competition, particularly in respect of newsprint, and our exports have suffered. The Swedes have several advantages—timber, pulp and paper on their doorstep. They have very cheap electrical power. What the industry in Scotland fears is further integration on the part of the Scandinavian mills and much heavier competition all round. One trump card which they have is that they control all the pulp we need. Those are the facts which give rise to misgivings among the paper manufacturers in Scotland.

There is the further point that if the Swedes are faced with increased tariffs in the Common Market countries they will be more eager to export to the United Kingdom, and they will go in not only for newsprint but for high-grade paper as well. It may be suggested that our industry can make financial arrangements with the Scandinavian industries or have bigger combines or some sort of cartel. That sounds very nice, but it is not practicable because the Swedes have everything in their favour at the moment and they need not worry about any representations from us or any moves by our Scottish companies.

I ask my right hon. Friend to study this matter extremely carefully and to discuss it with his colleagues in the Cabinet. I hope that he will listen most carefully to the representations which are to be made next week. The answer may be freer trade up to a point, based on the value or tonnage of trading over the past few years and the application of a quota, or it may be to reduce the tariff very slowly over a number of years. I do not know, but I very much hope that my right hon. Friend will not be bitten by this free trade bug which has seemed to affect the Treasury and the Board of Trade from time to time. I am glad to say that I have never been a member of the Liberal Party and I do not really believe in free trade. I repeat that I hope that my right hon. Friend will listen carefully to the representations that will be made to him.

6.22 p.m.

Mrs. Jean Mann (Coatbridge and Airdrie)

I have some trepidation in entering into the debate and also some pleasure. It will be the last time that I shall speak in the House of Commons about my constituency. On the other hand, I have a wonderful feeling that this time I shall be free of any suspicion of making a political, vote-catching speech. I shall not be personally affected in any way by the result of the General Election, apart from party feelings.

I had hoped that I should be able to take part in the debate, because my constituency has the largest rate of unemployment in Scotland. It has been said several times today that the employment situation in Scotland is twice as bad as it is in England, but in Coatbridge and Airdrie it is six times as bad as the Scottish average. My people—and I must apologise for using the personal pronoun for I am very far from being a Moses—register at Coatbridge and Airdrie Employment Exchange. We have heard a great deal about the decline of the mines and their closing. It may be my fault or it may be yours, Mr. Speaker, that I have not caught your eye often enough, but we have heard very little about the decline of heavy industry, and that is what primarily affects my constituents.

I had hoped that the Economic Secretary to the Treasury would have been able to shed a little light on this dismal problem. I had hoped even that he might have been able to say something about the experimental factory and the other factories which he has intimated will be coming to Coatbridge. Instead, he talked about the importance of the tourist industry. In Coatbridge we regard the tourist industry, and I do so particularly, as an industry of great importance and as one of prestige.

We are very proud of Scotland, very proud that all its beauty should be known world-wide. But it was with some humour, mixed with depression, that I read that the noble Lord the Minister of State for Scotland, addressing the Highlands and Islands Advisory Panel, had announced a new chief for the Highlands, a superman.

The noble Lord announced that Mr. Hugh Fraser was to devote his attention to the problems of the Highlands. He said: He is a man of action and is already working on the problem. I wonder whether he is following the example of others who work on Scottish problems. I understand that he is the chief of 60 businesses in Scotland, and has now included the Glasgow Herald, the Glasgow Evening Times, and the Glasgow Bulletin and all the subsidiary newspapers attached to that firm.

It might be said that Hugh Fraser himself may be the cause of a great deal of Scotland's unemployment when one man can look after so many jobs. That is not all. He travels to Carlisle as well. He goes up Sauchiehall Street, down Buchanan Street, and along Argyll Street to Carlisle where he has Binn's, and he supervises, in addition, John Barker, Derry & Toms, and Pontings, to say nothing of his exertions to get hold of Harrods. The Highlands are not a dying area according to the noble Lord the Minister of Sate, but are brimful of opportunities waiting to be seized The noble Lord has appointed the right man if it is a case of seizure. Are the Highlands to be subject to a take-over bid? One wonders how long it will be before the House of Commons itself will be taken over. I would say to my colleagues and friends, whom I hope are on both sides of the House, "Watch, therefore, that your lamps be kept trimmed and burning, for you know neither the day nor the hour when the House of Fraser cometh."

The tourist industry is important. Scotland has great versatility and a great potential. It not merely attracts tourists and has the finest scenery in the world, but it has had a record United Kingdom output in the basic industries. I can remember that when my party was on the opposite side of the House I received a reply at Question Time of which I was very proud, to the effect that the Clyde was responsible for 38 per cent. of United Kingdom shipbuilding. For heavy industry the figure was 28 per cent. We were then on the up and up.

I am sorry to say that that is not now the case. Officials in Coatbridge have prepared some information for me. I am greatly indebted to them for working overtime on this subject and for often meeting me after hours, even on a Sunday afternoon, and always being available to help me at any time. I am sorry to say that the present position is not very hopeful. Hon. Members will remember that a year ago we were reaching the peak of depression and we had deputations to Edinburgh and to London, and so on. We were promised factories.

I now compare the figures for the end of June with the dreadful figures of last year. By the end of June last year, the unemployment figures had soared from a total of 1,025 to 2,070, but by this time last week they had reached 2,126. In building and civil engineering alone, the unemployment figure for last year had soared to 146, but in June this year it had reached 277. In Airdrie the position is worse, the figure for building and civil engineering being 156 compared with 110 a year ago.

In tube manufacturing in Airdrie it is still rising, 76 last week against 70 last year. The wholly unemployed in steel sheet rolling showed an increase of 100 per cent. with a decrease of 50 per cent. in those temporarily stopped. In the heavier steel industries, steel manufacture and rerolling. May's figure was 272 against 293 last week. In Airdrie the corresponding figure was 142 last week compared with 97 in May.

I met some of the employers, although some of them would not meet me. Some of them, like Sr Andrew McCance, who have the ear of the Prime Minister and representatives of Stewarts and Lloyds are coming to meet me. I know that Stewarts and Lloyds are not exceedingly busy, but they are busy in Corby and not busy in Coatbridge, as the figures show. I understand that the reason is that the firm makes smaller pipes in Corby while in Coatbridge they have always made very large pipelines and were affected by the events at Suez. They are still in the doldrums. Other employers such as Anderson Bros., and the heavy engineering firm of Morrison Leith Ltd., blame the shipbuilding depression and say that they are suffering the effects of shipping being in the doldrums.

I do not know the answer and we do not appear to have an answer. Mr. Parker of the Scottish Coal Board has said that there will be jobs for all the miners displaced in Scotland, but the jobs are probably for men of the wrong age and are in the wrong places. I do not see even that ray of hope for the heavy industries of Coatbridge.

If I were asked whether we were not benefitting from the steel strip mill, I could only quote Sir Andrew McCance, who has said that he can offer no hope for Coatbridge and Airdrie and that Motherwell and district has a sufficient reservoir of labour for his firm's requirements.

It is with some regret that I say that this kind of speech must be my last speech about my constituency. Some of my constituents are bitterly disappointed that I have intimated that I am to retire. To get me to reconsider my decision, some of them have told me that I am leaving them with this problem. I am very depressed at the thought of that. I am glad that my constituency was chosen as the site for the experimental factory and very glad to hear from the Parliamentary Secretary to the Board of Trade that two other factories are to be built and that two more are in prospect. I hope that we shall hear some encouraging details about these factories. How soon is the experimental factory to be built? What are the prospects?

Coatbridge has a population of 50,000 and is dependent on heavy industry, with a history of unemployment going back to 1931, when our unemployment rate was the highest in Scotland, actually reaching 56 per cent. It is natural that we should have grave doubts about the future and that we should be very anxious to see that some hope is given for the future, some diversification of industry which will bring about that end which all men and women want, a purpose and work. I hope that I shall hear a reply which will bring that hope to my constituency.

6.38 p.m.

Mr. Patrick Maitland (Lanark)

I am particularly happy, as I am by profession a journalist, that it should fall to me to follow the hon. Lady the Member for Coatbridge and Airdrie (Mrs. Mann) who has just made her farewell speech, because one of the many characteristics of her speeches, which both sides of the House have always enjoyed, is her infallible instinct for the headlines. I am sure that I speak for all hon. Members when I say with absolute sincerity that we shall miss her very much.

The unfailing courtesy of the hon. Lady is common knowledge. Her endless good humour which taunts us on both sides of the House, her tremendous humanity, her pleadings from the bottom of her heart about all the people in her constituency have moved us and made her, as she rightly said, a friend of Members on both sides of the House. I, for one, shall always miss what I shall call the mellifluous tones of her voice which have particularly endeared her to hon. Members.

Speeches from hon. Members opposite in the debates today and a month ago have been something of a litany about the degree to which the State could or should intervene in industry and the degree to which it should enjoy a position of control. I do not want to labour this aspect but to come on to matters which I believe to be less sterile and more constructive. It is, however, fair to ask how far the Labour Party during six years of office took charge of Scottish industry. How far did it plan Scottish industrial resources, and how far, if it did so, did it bring satisfactory results?

If Scottish industry is controlled, at the end of the day its life would still depend on access to overseas markets. How far would State control of Scottish industry, by whatever means, assist those industries to conquer markets overseas? I reckon that the calculation that I have made many times is substantially sound. For every £1 million worth of overseas orders for capital goods received by this country there is directly created about 1,000 jobs for a year, and indirectly, on the principle of Keynes' multiplier effect, many more. I do not know how State control would stimulate Scotland's capacity to do better in overseas markets. Certainly the example of one nationalised industry which has given to us a tremendous example of disinvestment is not much of an advertisement for State control. The National Coal Board's disinvestment has been substantial and is not, in itself, a great justification either for State control, or for the capacity of a State-controlled enterprise to control markets at home, let alone oversea.

Mr. A. Woodburn (Clackmannan and East Stirlingshire)

State control is not on trial at the moment. In Scotland private industry has had 150 years to prove itself. The charge that has been made today is that, whether or not it is due to private industry, the fact is that private industry is not able to provide work and prosperity for the people of Scotland. So far every hon. Member opposite has been asking for assistance for private industry. It is not for us to say anything about State control. If the hon. Gentleman believes in private industry, he should tell us how it will work; otherwise the prospect is very black indeed even if the hon. Gentleman's picture is correct.

Mr. Maitland

That point at issue is how far Government investment in private enterprise should be accompanied by a measure of Government control. That was the issue that was put with some force and vigour by the Opposition in the first of these two-day debates. My view is that the Government's attitude is right. It is that when private industry needs this, it should be assisted on a loan basis without Government control, because I do not believe that State control facilitates the conquest of markets oversea.

I wish to join with others in paying tribute to the imaginative approach of my hon. Friend the Member for Fife, East (Sir J. Henderson-Stewart). There is a strong case for a special study to draw up a five-year plan or programme for Scotland. I believe that because Scottish conditions are different from those in the rest of the United Kingdom. I believe it because the present D.A.T.A.C. policy, and the present application of the distribution of industry policy, is a United Kingdom and not a Scottish policy. I believe it because if special treatment is possible for Ulster, the same should be possible for Scotland. I believe it because the present application of the distribution of industry policy does not take account of the problem of depopulation and the consequential ruin that goes with it.

The opening paragraphs of the Report that we are invited to take note of today refer to population and employment. In the language that we are accustomed to in these reports we are always told that population is rising, and we may sometimes be told that employment is rising also. Of course, we are not told that this year. But, above all, we are not told anything about depopulation in some areas. That is my first criticism of the Report.

In the House and in the Scottish Grand Committee we are accustomed to talking about the depopulation of the Highlands. Those of us who represent Lowland constituencies are accustomed to hearing this theme discussed ad nauseam. While we are constantly being reminded of the needs of the Highlands, and it is admitted by the Government that there is a case for trying to steer industry to the Highlands; we are not told—and the Government do not seem to recognise this and never have, on either side of the House—of the need to try to steer industry to the Lowland areas.

I have a great deal of sympathy for the gallant battle fought by my hon. Friend the Member for Caithness and Sutherland (Sir D. Robertson) who has sat as an Independent in this House for some time. I have much sympathy with his courage and independence because I have sat as an Independent Unionist myself and it takes some courage to do so. I am sorry that he is not here at the moment but I hope that he will come back to the party soon and pull his weight with the rest of us.

What are we to do and what is being done about the depopulation of the Lowlands? In a document that was circulated in time for the first of these two-day debates, I notice that the Scottish Council made a point about the need to relate assistance to industry to the problem of depopulation. On page 3 of this Memorandum it says: The Council accordingly recommends that more extensive official facilities, defined blow, should be provided in the following areas. The Memorandum mentions a number of counties in various parts of Scotland and adds: Areas of persistent high employment or rapid depopulation. I have mentioned this problem of depopulation year after year in what the hon. Member for Dunbartonshire, East (Mr. Bence) referred to as these "ritual debates". One of the tragedies of these debates is that we seem to make the same speeches year after year. The only difference is that the hon. Member for West Lothian (Mr. J. Taylor), who I am glad is still in his seat, this year had to recite a sort of solemn requiem about Bo'ness, whereas in previous years he was still pleading for the place to be kept alive.

I have mentioned Leadhills in the debates year after year. It has been losing population. Tarbrax is another place that was almost completely depopulated. If there were no American soldiers in Scotland the houses there would be virtually unoccupied. The village of Forth, which is known to hon. Members opposite, has lost some 300 families in the last six years. That might well amount to something like 1,200 people. The landward area which I represent—the Upper Ward of Lanarkshire—has lost something like fifty families a year for the last ten years. Finally, we have Douglas which has been losing one-third of its population and half its employment within a matter months.

In the light of this problem of depopulation, I agree with the Government's broad overspill policy which I must in fairness say was not originated by this Government. It was a development of the Clyde Valley plan contrived by the Government of hon. Members opposite, but I heartily support the principle of this essentially bi-partisan overspill programme.

I only regret that in paragraphs 38 to 41 of the Report on Industry and Employment in Scotland there is some glossing over of the difficulties. It is true that a number of town councils and one or two new town Corporations have made overspill arrangements with Glasgow, but even with the East Kilbride Development Corporation there are puzzling delays in regard to the conclusion of an overspill agreement. We all know that, in general, county councils are holding back from concluding these overspill agreements, and it is certainly the case that the Lanark County Council, despite an urgent plea from the District Council of Douglas, is holding back from concluding one. This problem of the holding back of county councils is not faced in the Report.

Mr. Emrys Hughes (South Ayrshire) rose

Mr. Maitland

I am sorry. Time is short, and others want to speak. I have a good deal to say. I did not interrupt anybody in our last debate and I am sure that the hon. Member will forbear.

Mr. T. Fraser

The hon. Gentleman has made an important statement. He said that Lanark County Council was delaying the conclusion of an overspill agreement.

Mr. Maitland

No. I said that the East Kilbride Development Corporation had not concluded such an agreement, and that there was some delay. I understand that the Lanark County Council is holding back completely from the very idea of an overspill agreement.

I say that it is important for my right hon. Friend to face the fact that this overspill policy will work only if efforts are made to convince local authorities —primarily county authorities—that an overspill agreement does not mean importing unemployment. I hope that my right hon. Friend will take steps to that end.

The distribution of industry policy, which has been the principal subject matter of this two-day debate, is touched upon in paragraph 25, which gives us figures in respect of new factory building and extensions. For the whole of Scotland, the difference between 1957 and 1958 is only 80,000 sq. ft. In 1957 the figure was 4,046,000 sq. ft. and in 1958 it was 3,968,000. That is for the whole of Scotland, but in respect of the Development Areas there is a sharp decline, amounting to 15 per cent., from 3,013,000 sq. ft. to 2,548,000. There has been a fall off of nearly 500,000 sq. ft. in new building in the Development Areas. In part, no doubt, that reflects the recession—and none will deny that there has been a recession, even though it is normal for the Opposition to try to blame us for it in a pre-election period.

There is no doubt that Scotland has been suffering because of a hesitation on the part of American industry to invest over here, owing to the doubtful position of the United Kingdom in relation to Europe. I have discussed this question with American industrialists, who have told me that owing to the breakdown of the project for a European Free Trade Area, to gird the Common Market with another trading area, there has been a great deal of holding back on the part of American capital in the last year.

Now although the paper interests in Scotland make the case they must make, in self-defence, about the difficulties that threaten them with regard to a trading area with the Outer Seven, I hope they will not speak too loud too soon, but will first view the whole thing in perspective. If the project for the Outer Seven matures, it might be easier to get some new American investment in Scotland, to our general advantage.

There is one other facet of the difficulty of securing development. I should like to illustrate it by referring to a particular case, although I do not want to name anybody, for good reasons. It sometimes happens that industrialists or investors are deterred from developing a certain project by political considerations. I can think of a case of a firm which was distressed and disappointed at the quite unfair and unworthy criticism which which was made of it locally in Carluke, in regard to its reopening of factory premises which it had been using as a store. Narking, critical remarks may just make the difference between the company saying, "All right, we will open up that factory", and saying, "We will keep it as a store". That is a danger which has occurred in Scottish affairs more than once in the last year or two, and is no doubt to be expected as a General Election approaches and people's tempers rise. But it is a factor in the encouragement of investment which we should do well to watch, in the interests of all our people.

The figures for factories for 1957—of 3 million sq. ft. in Development Areas and 4 million sq. ft. overall—are not good enough. The annual Survey of the Clydesdale Bank for 1958, referring to the volume of factory building, says: It appears likely that if existing factories are to be replaced and provision made for an expansion in industrial employment in Scotland as well as for some transfer of population from Glasgow to other centres, the completion of new factory buildings will have to be sustained at, if not exceed, the annual figure of close on 5 million sq. ft. that was recorded in 1957. In its Memorandum, the Scottish Council estimates that a yearly figure of 6 million sq. ft. rather than 5 million sq. ft., should be the target.

This brings me to a serious question concerning our general distribution of industry policy. I wonder whether it is rightly conceived. There is a very apt comment upon it in the editorial of the June issue of Town and Country Planning. The leading article is headed, "Work to the Workers?" It is concerned with the D.A.T.A.C. scheme to try to stimulate new employment in areas of high and persistent unemployment, rather than space it more widely, and it says: The general goal of 'bringing work to the workers' continues to possess a potent appeal, but the details of its application are slowly changing. The latest Government measure proposes help for all areas whose unemployment rate is judged excessive. … In all of this there is much that is wise, but some things, too, that are short-sighted. In the first place, the need for achieving a healthier balance of growth between the main regions of Great Britain still exists and has great importance. … It would certainly be wise to make renewed efforts to encourage industrial growth in Northern England, Scotland and Wales. … And any subsidisation devoted to this purpose can reasonably be regarded as some offset to the heavy though often concealed subsidisation (on costlier public services, higher public salaries and wages, cultural subsidies, etc.) provided for London. … It does not follow that 'work to the workers' is invariably a sound principle. It may seem politically rewarding to try and mop up pockets of unemployment wherever they occur, and this no doubt explains the renewed and closer attention paid to the subject by both main parties. But it is still more important to locate the new industries in places where they can operate efficiently and where their workers can enjoy good living conditions and healthy surroundings. This is not possible if new employment is pumped into already closely congested areas such as Merseyside or Clydeside. … It is time to review the development area programme, and its recent modifications, from the viewpoint of creating really satisfactory regional economies. By considering the region, rather than the localised zones of unemployment, it is possible to find the best growing-points for industry and population, and to plan transport improvements, public services, and other matters accordingly. Yet, the entire distribution of industry policy which the present Government inherited from the Labour Government of 1945—I appreciated the intervention of the hon. Member for Hamilton (Mr. T. Fraser)—is now cramped and limited, as I understand it, by the criterion established for the D.A.T.A.C. schemes.

No doubt my hon. Friend the Economic Secretary to the Treasury will recognise his own words which I wish to quote from a letter of 8th May which he wrote to me. He said: Many places in Development Areas now have a lower rate of unemployment than that of places outside the Development Areas. Of course, but, we are talking about depopulation, which I contend is a consideration we should have very much in mind. My hon. Friend the Parliamentary Secretary to the Board of Trade wrote to me on 8th May: I am afraid we must stand by the decision that priority must be given to areas which at present are unfortunate enough to have high unemployment. I am sure that my hon. Friend the Financial Secretary to the Treasury will not mind my quoting from his letters. He seemed to put it succinctly in a letter of 29th May in which he said: It is contrary to Government policy, in view of the new Act specially introduced in 1958 to deal with local unemployment, to make use of the Treasury powers under Section 4 of the 1945 Act to give assistance for reasons of unemployment in places which do not qualify for assistance under the 1958 Act. I can hold out no hope of a reversal of this policy in the case of Douglas. That letter was in reply to a letter of mine drawing attention to the powers under the 1945 Act, for the Secretary of State to make grants and loans for basic services and for the Treasury to give financial help to industrial undertakings and for the Board of Trade to build subsidised factories.

I concede that the Government have come a little way toward breaking down the limitations of their D.A.T.A.C. definition. I appreciate the replies which I received on 14th May and 2nd June. I had asked whether D.A.T.A.C. assistance would be given to firms which established their undertakings outside what is technically defined as a D.A.T.A.C. area. On 2nd June I was told … applications for financial assistance by any firm would be considered, provided it would offer employment to workers in an adjacent D.A.T.A.C. area."—[OFFICIAL REPORT, 2nd June, 1959; Vol. 606, c. 19.] That represents an advance. But I must also draw the attention of my hon. Friend to the fact that it was a step back from the Answer given to me on 14th May when he said: Such applications would be fully considered if they would help employment in the adjoining D.A.T.A.C. areas."—[OFFICIAL REPORT, 14th May, 1959; Vol. 605, c. 1411.] There is an important distinction here. Suppose a factory is established outside a D.A.T.A.C. area and draws its employees from people living outside the area. That may well be a help to employment inside the D.A.T.A.C. area, because the people now travelling to the D.A.T.A.C. area to work would be able to work at home and thus more jobs would be created inside the D.A.T.A.C. area. I hope that the Government will study the point with some care. I raise it now with emphasis, and I seek the indulgence of the House in pressing this, because I have a particular project in mind, concerning the use of raw materials mined outside a D.A.T.A.C. area.

Would a project established to process that raw material qualify for D.A.T.A.C. help only if the plant is set up inside a D.A.T.A.C. area, which would involve heavy transport costs for conveying the raw material to the factory? Or would it qualify if the whole thing was established near the source of the raw material; in which case it would be a more economic proposition, employing local people who would be able to work there instead of travelling into a D.A.T.A.C. area, and so easing the position within the D.A.T.A.C. area?

I commend this point to my right hon. Friend the Secretary of State. I appreciate the sympathy which he has shown so far to the whole problem, but I ask him to bear this in mind and I am happy that he is present in the Chamber because he has given much attention to my constant pleas on this subject.

This question of travelling to work is more important than it would appear. I was present when the Parliamentary Secretary to the Board of Trade paid a very welcome, if all too brief, visit to Lanark some months ago and met two of our district councils. The point was made then about the need for industry locally, to save people from having to travel to work. But I got the feeling that in the rush of the occasion the Parliamentary Secretary did not fully appreciate the point which was being made. It is that if people are to spend say, £1 a week—or it may be 30s.—on travelling to work somewhere else, that money is being spent on an activity which is wholly unproductive, namely, transport. What I referred to earlier as the Keynes multiplier effect does not come into operation. But if that money stayed in the pockets of the people who earned it, and it was used for local expenditure on consumer goods, it would have a work-creating effect. Meantime, the demand for transport to travel elsewhere is siphoning capital into something which is not in itself productive. Therefore, I plead with the Government to give further thought to the whole question of the implication of the D.A.T.A.C. area definitions on travelling in the kind of case which I have listed, and whether it is economic to keep the application of the 1945 Act so narrowly to the D.A.T.A.C. definitions of 1958.

We have been told that D.A.T.A.C. applications take up to three months to process. I know that it would be a great mistake to do the job in a shoddy manner, but there is a degree of uncertainty in some quarters where applications have been pending for some time. I hope that the Treasury can do something to speed them up. Then there is a limitation under the D.A.T.A.C. scheme that a firm already established does not apparently quality for grant help, it the application of the money will be of a revenue-producing character. Apparently a firm can get a grant to help with facilities like an approach road, or a parking area, or for strengthening the structure of the factory, or to provide canteens and amenities of that sort, which are all valuable but do not stimulate employment.

I wonder whether the Government are adopting too narrow a policy in their application of their own D.A.T.A.C. rules. If a firm is established, but feels that it would be unwise to expand beyond a certain tempo with its own resources, and if at the same time expansion beyond that tempo would create new employment, surely that would create grounds for giving grant help, even though the factory or firm might eventually derive a profit from it.

There is also the question of steering Government orders. I have in mind a light engineering factory which is doing excellent work and which despite the limitations of D.A.T.A.C., could expand if it had a sufficient flow of orders coming in. I beleive that Government orders could be steered to this factory. My hon. Friends in the Government know all about this because I have spoken about it on a number of occasions. If Government orders were steered in that direction it would be a useful and fecund activity.

I believe that the distribution of industry policy, as at present conducted, is inadequate. I believe there to be a whole range of other considerations which should be borne in mind, for example, the steering of orders and the anticipation of things like colliery closures. Apparently, the twenty colliery closures came on us like a clap of thunder and there was very little national planning in anticipation of it. That is the sort of matter which would naturally come within the purview of the kind of study proposed by my hon. Friend the Minister for Fife, East. There are questions like the guiding of industry in relation to the problems of transport. The general overall argument put out so well by the Scottish Council was a strong, sound economic argument, that very considerable sums could have been spent in the last few years on redevelopment as well as on unemployment relief.

All these matters would be proper subjects for the study that my hon. Friend suggested. That is why I plead with the Government to take due note of his suggestions. Although I have spoken in a mildly critical, but I hope objective, way of the Government who I so ardently support—now that I am no longer independent—I know that my right hon. Friend the Secretary of State for Scotland and his colleagues have given a lot of attention to these problems. I think they are unduly restricting themselves by their definitions, and I hope that they will see fit to break away from those definitions and initiate a Scottish policy for Scotland.

7.12 p.m.

Miss Margaret Herbison (Lanarkshire, North)

The hon. Member for Lanark (Mr. Patrick Maitland) finds himself in very great difficulty today. His speech was a criticism of his own Government, yet in the last few sentences he told us that he was an ardent supporter of this Government. He spent a fair amount of time in going over the Questions which he has raised in the House about Douglas and how D.A.T.A.C. might apply to it. He seemed to get a ray of hope from a number of Answers, some of which seemed contradictory.

In North Lanarkshire I do not have these problems about D.A.T.A.C. My area has been badly hit, like Douglas, but as it is a Development Area all the provisions of the Distribution of Industry Acts apply. Just as the hon. Member has found in Douglas, so I have found in my area, that nothing has happened to take care of the problems. The hon. Gentleman said that the 20 closures seemed to come about without previous knowledge or plan.

I have a speech here which I made in a similar debate on 14th July, 1953, in which I pointed out to the Government what the National Coal Board had said about what was to happen in Lanarkshire in ten years' time. What was predicted is exactly what has happened. If the Government had realised the effect of National Coal Board planning and what was to happen in the mining industry of Scotland they could have taken steps to mitigate the social evils that have arisen.

The only other point I will take up from the speech of the hon. Member for Lanark is the criticism of the speech of my hon. Friend the Member for Dunbartonshire, East (Mr. Bence), that when my hon. Friend was talking about disinvestment he did not speak of the National Coal Board. Of course, he could not when he was dealing with disinvestment. Never at any time in the history of the coal industry has so much capital investment gone into it in Scotland as in the period from 1947. Some of the closures would not have come so quickly had it not been that the Government, by pulling back production in this country, hastened the closure of pits. I have no doubt that it was the Government's economic policy almost alone that brought about the sudden closure of the pit in Douglas and the others in my constituency.

I now turn to other matters. In Scotland we have about 9 per cent. of the population of the United Kingdom, but, according to the latest figures published only this week, we also have 20 6 per cent. of the country's unemployed. A much more serious figure relates to boys under 18 years of age. Scotland has 27.6 per cent., or more than a quarter, of all the young men unemployed in the United Kingdom and 18 per cent. of the girls under 18 years of age who are unemployed. These are shocking figures. Many of these young people are school leavers. I have in my constituency school leavers who have been unemployed since their school closed this time last year and others who have been unemployed since their schools closed at Christmas or at Easter. What a tragedy it is for a boy or girl leaving school to have no work and to have to roam the streets, feeling completely unwanted.

As to unemployment in my constituency, I would refer again to the speech I made in 1953, in which I warned the Government that if they did not take action in certain areas we should be faced with almost total dereliction. On 11th May, 1959, I was told by the Minister of Labour that in the area covered by the Shotts Employment Exchange—including a number of places that have been hit by the closures—5.1 per cent. of the insured population are unemployed. Why I interrupted the Economic Secretary to ask in which areas there had been an increase of unemployment from May to June was that the Minister of Labour sent me figures for this area for 15th June. They show that, far from having decreased over the last month, unemployment has increased.

There is an even blacker side to the picture. The Government did away with Section 62 of the National Insurance Act, which means that in an area like mine where there is no alternative employment, a time comes when unemployment benefit can no longer be paid to unemployed men and women. Apart from the latest closures, who are the men who are unemployed? Mainly miners, a percentage of whom, very often, are suffering from pneumoconiosis.

I began to wonder how many workers in the area covered by the Shotts Employment Exchange were in receipt of sickness benefit, and I asked for the figures. They show that in this area we have approximately 700 insured workers who have been in receipt of sickness benefit for six months or more. That means that we have over 5 per cent. unemployed, but we have an additional 9 per cent. in receipt of sickness benefit for more than six months. The Government may say that these people are not fit for work, but I say that if the majority of them were in the London area or in the Midlands they would be working. They may not be able to work fifty-two weeks a year, but they would be able to hold down a light job, although at times they might be off work and on sickness benefit because of pneumoconiosis. I am convinced that if they lived in an area of full employment many of them would be in a job today.

The opportunity for jobs for youths in the area is almost nil. Before the schools closed on Tuesday of this week there were within that one area of villages covered by the Shotts Employment Exchange fifty-five boys and girls without a job. I interviewed the youth employment officer and he had the figures of those who left the junior secondary schools in the area on Tuesday of this week. There would be 102 boys and girls leaving and ready for a job. Carrying out his duty, he notified all the employers in the area asking for information of jobs which they had available and by Friday of last week he had received a number of replies, but not a single job was available from all those employers. That shows how serious the position is. Not only are there the 102 leaving junior secondary schools, but there are a number of senior secondary schools also in this area where I was unable to obtain the figures of school-leavers. The reason given by the youth employment officer was the suspension of recruitment for the mines, but it is even more serious than that because the mines and the mining industry are now disappearing completely from that area.

I have dealt with unemployment and those who are long-term recipients of sickness benefit, but in all these debates during the period of office of the present Government I have never at any time based my case for alternative industry coming to the area on the figures of unemployment. I can do that today, but I prefer to base it on what is to be the future of the area.

A number of years ago I brought a very high-powered deputation from Lanarkshire County Council to meet Ministers in London to discuss employment for this area. On Friday of last week the Secretary of State received a deputation in St. Andrew's House. He received it very courteously and listened carefully to what it had to say, and he had officials from the various Ministries present. He saw how responsible were the people who came with me and how representative they were of all the different aspects of life in that area. He came out and saw about 100 men and women, good people whose only desire was to ensure that their villages should have a life in the future.

From January, 1947, to May, 1959, in the central east area of the National Coal Board there has been a reduction of 2,400 in the number of miners employed. That is in one district which covers the area about which I have been speaking and part of the area represented by my hon. Friend the Member for West Lothian (Mr. J. Taylor). There has been a reduction of 17.2 per cent. of mining jobs there. In the Shotts, Cleland and Salsburgh area, six collieries and two mines have closed since 1947 and 2,161 mining jobs in that small area alone have disappeared. On the exchange books covering the Shotts area there are 101 miners unemployed. It is quite wrong to say that the National Coal Board can provide work for all the miners when pits close, because of the men who worked in Southfield, the latest pit to close, over sixty miners are still without a job. Calderhead Colliery closed in August last year, almost a year ago, and of those living in my area—the only ones about whom I have information—fifteen are still unemployed.

Yesterday, in answer to a supplementary question by my right hon. Friend the Member for Blyth (Mr. Robens), the Minister of Labour said: I am glad that the right hon. Gentleman has emphasised that aspect of the matter, because the social effect of closures must be studied along with the economic effects."—[OFFICIAL REPORT, 1st July. 1959; Vol. 608, c. 442.] Surely the Minister of Labour must know that I and other hon. Members have year after year been emphasising the dire social effects of what is happening through the closing of pits in our constituencies. It is not only the closure of pits in this area which is serious, but in Newmains the Coltness Ironworks closed during the time of this Government and more than 600 further jobs disappeared. Again, since the end of the war, pig iron production in Shotts disappeared. What have we got in place of all those 3,000 to 4,000 jobs which have disappeared? We have in their place one industry, which certainly is thriving at present, but it is employing only 460 people. The hon. Member for Lanark may fight as hard as he likes to get D.A.T.A.C. to apply to Douglas. We have not got that fight—D.A.T.A.C. applies to our area—but we have not got the industry. This requires urgent action by the Government which they are not willing to take.

I turn to the reduction in the number of people living in the area. The earliest figures I could get from the Minister show that in 1952 the number of insured workers covered by the Shotts Employment Exchange was 8,860. In 1958 the total was 7,510. The total has been further reduced since then for every week families are moving out of the area. In those six years there has been a total reduction of the insured population of 15.2 per cent. If nothing is done about it, I warn the Government that the area will become completely derelict.

I want to take a few minutes more to refer to the other end of my constituency. My hon. Friend the Member for Coatbridge and Airdrie (Mrs. Mann) dealt very fully with the question of employment in her constituency and with the percentage of unemployed. I have the greatest difficulty, except in the case of the Shotts Employment Exchange which is the only one which covers my area, in getting the figures, as does the hon. Member for Lanark.

Mr. Patrick Maitland indicated assent.

Miss Herbison

The hon. Member nods his head. He has the same difficulty. Many of my villages in North Lanark are covered by the Airdrie Employment Exchange and the Coatbridge Employment Exchange. There are in the steel works at Gartcosh 600 fewer men working today than there were two years ago. In the brickworks at Glenboig there has been great redundancy. The paper mills at Calder-cruix have made representations to me, which I took up with the President of the Board of Trade, and I was informed about the meeting that was to take place with the Minister soon. There was redundancy in these paper mills last year. There is nothing in that area at all so far to provide alternative work.

The Minister today spoke about how the production of steel strip would encourage industry to come to our country. It is only by planning beforehand that we shall get it. We are getting a very much smaller production of strip steel than Wales is getting in its new strip steel mill. It is of the greatest importance that we should use all of our powers under the Distribution of Industry Act in order to plan for factory space to be made available there when steel strip begins to come from the Ravenscraig mill.

I have raised this matter before. At this end of my constituency the finished product will come from the strip mill in Gartcosh, and I understand that this week building is beginning in Gartcosh. It is a very big area. I beg the Government to put more planning into it. We are getting near the end of this Parliament. We on this side of the House have pleaded for something to be done for Scotland. I have very little faith that this Government will do much about the problems raised by myself or by the hon. Member for Lanark. My great hope is that, if an election comes in October, we shall have a Labour Government which knows the needs of South Lanark, North Lanark and the rest of Scotland, and a Government who will ensure that there will be a real distribution of industry policy for those good, active people with plenty of initiative in my constituency who are ready to work hard at any type of work that is provided.

7.34 p.m.

Mr. Michael Noble (Argyll)

I am sure that the hon. Lady for Lanarkshire, North (Miss Herbison) will not expect me to follow her on the problems and difficulties of Lanarkshire.

As a black face sheep farmer, I know the dangers of going anywhere near Lanark market, where a nod at the wrong moment can cost one thousands. As a farmer, I also share a pride in the work of Scottish farmers as a whole in increasing productivity and in their greatly increased efficiency over the last twenty-five years. That increase in efficiency has, unfortunately, produced one result which is not perhaps for the benefit of those of whom we are speaking in the debate today. We have employed 25,000 fewer people on the land in the last twenty years due almost entirely to our increased efficiency. The loss of these people has been a great sorrow to the countryside, and we should like very much to be able to draw back some of those from the towns, thereby helping them in their problems of unemployment and of housing.

I should have liked to have said to the hon. Gentleman the Member for Dundee, East (Mr. G. M. Thomson), had he been in his place, that if he is getting his student to write a chapter on the importance in employment of the preferences of the manager's wife, he should include among the places which the manager's wife apparently does not like, not only Dundee, but Argyllshire, because it is not easy to get people to bring industry into the Highlands, and it is not easy for those of us engaged in agriculture to employ a great many more people.

There is only one hope in that direction. That is if, in future, as I think may be possible, we can break through what seems at the moment to be the top level of the stocking of our hill ground. If we can, I think that it will probably come only through the use of aeroplanes for spraying the bracken and putting on fertilisers. This, perhaps, may be of some help to Scottish Aviation in its ideas.

I feel that it is possible to get a number of industries back to the Highlands and particularly those based on the raw materials that we produce there. If we are to do that, the outstanding opportunity which seems to be available at the moment—because it is the outstanding raw material which is available—is the introduction of mills to deal with timber. I hope that hon. Gentlemen opposite who heard me speaking briefly on this subject upstairs this morning will forgive me if I develop it a little further by saying this. The forests in Scotland, planted both by the Forestry Commission and by private owners, are growing up fast. It is quite possible that in the near future a great deal more timber may have to be imported from Russia in return for extra trade with her, and from the Scandinavian countries, if the problems which my hon. Friend the Member for Lanark (Mr. Patrick Maitland) suggested come about.

If that is so, it seems to me that the right policy for the Government now is to encourage the setting up of pulp mills, chip mills and other types of mills, whichever are the most suitable, and that those mills should be on or near the coast, so that the raw material from abroad can come immediately to those mills and keep them operating now, and so that, in a few years' time, the timber that we are producing and which is visibly growing on the hills of Scotland will have a market close at hand to take it. I feel, also, that if we can look upon this primarily as a problem of sea transport, we can revolutionise the whole of our transport ideas concerning particularly the north and west coasts.

These are fairly scattered areas, but there is a possibility of great areas of ground being planted where, at the moment, there is no way of getting the timber out. A big plan on those lines could do much to bring immediate help to Highland areas and to give encouragement to more planting of trees. It would also help by starting a movement to get other ancillary industries in the area.

I am sorry that the Economic Secretary to the Treasury is not in his place, because I wished to point out to him the problems of quarrying in parts of the Western Highlands, for instance, sand near Lochaline or diatomite or kyanite or others of the new minerals which are being found and which I hope will be used. Wherever there are mining and quarrying enterprises in existence, there is a genuine feeling of sorrow that the suggested Amendments to the Finance Bill, which have been placed on the Notice Paper during the last two or three years, have not yet been accepted by the Government. Some help could be given to these quarrying industries to make them more profitable and more likely to employ additional labour.

The last subject on which I want to touch has been mentioned several times in the debate. I refer to D.A.T.A.C. Earlier today, when the Economic Secretary gave the number of jobs which would be made available by schemes already approved—a figure of 425—there were signs of misery from the Opposition, who thought that it was an insignificant total. I assure them that while 425 jobs may be very small beer in such constituencies as Lanark and other constituencies in the big industrial belt, the position is quite different in the Highlands. In the first place, this is only a start, and it can be extremely important.

In many areas of my constituency, if I could get a small industry going which would employ 20 people and pay them a good living wage, the effect of it would spread far beyond those 20 people. It would involve the shopkeepers and all the other people who go to make up a community. Once depopulation reaches a certain level it is impossible for a community to live, as it were, by taking in its own washing. There is a great future for a number of small industries, helped and supported by D.A.T.A.C. and employing perhaps only 20 to 50 people each. They would bring a sense of community life to the Highlands without spoiling in any way their essential beauty.

May I stress to the Economic Secretary the importance of getting the D.A.T.A.C. schemes through as quickly as is reasonable? I do not think that any of us want schemes rushed through without proper thought, with the possibility of their collapse after a few months, but I know of schemes in my constituency in respect of which applications have been made for many months, certainly more than six months. It may well be that because they are small people they are not presenting the facts of their case in the most businesslike and efficient way. Some of the fault may lie with them. Nevertheless, I beg the Economic Secretary to make sure that the D.A.T.A.C. staff is adequate to obtain the necessary technical information and to take a decision as quickly as possible. In many of these cases if the delay is too long, the whole scheme may fall to the ground.

I have spoken for as long as I think one ought to speak in a debate in which many other hon. Members want to take part. The Opposition have taunted us many times today on the fact that we are expecting Government aid. We do expect it. It is common ground between us that in many cases Government aid should be given and that there is nothing disgraceful or disreputable in asking for it. Nevertheless, we believe that it is possible for the Government to give aid in the form of loans, or in whatever way is needed, and for private enterprise to run the industry. We have been most successful in agriculture, but, in spite of the Government help which has been given to agriculture, I do not think that hon. Members opposite want to nationalise agriculture.

There is not much between the two sides of the House on this matter, and I think that the argument which has bubbled up several times today is not a serious argument between us.

7.47 p.m.

Mr. William Hannan (Glasgow, Maryhill)

I think that the hon. Member for Argyll (Mr. M. Noble) is right to say that there is no divergence of principle between us in the matter of at least affording some assistance to these areas. Our objection is to the claim made by some hon. Members opposite that private enterprise alone is responsible for any improvement which may have come about in our economic position, particularly since it was the same private enterprise, as a result of Government policy, which first of all created the recession. On a subsequent improvement taking place, it is claimed by some people that we should all fall down in adulation of the very private enterprise which created the recession in the first place.

I could not agree more with him than when he spoke of the necessity for ancillary industries to forestry in the Highlands. We have debated that subject this morning and I will not develop it at great length, but I concede the point which he made, and if the Government will pay greater attention to this matter in the future I am sure that it will bring great comfort to all of us who want to see greater progress made in the north of Scotland.

On this point I would draw attention to the development of the canals in the North. Such development, as mentioned by the Bowes Committee on Inland Waterways, would greatly assist. I am sorry that in their White Paper the Government have not been more forthright and have not gone further than is shown in paragraph 19, which reads: The recommendations concerning the Caledonian and Crinan Canals and the main line of the Forth and Clyde Canal raise important issues and are being further considered by the Government. After all the previous Reports and inquiries, I should have thought that the Government would already have made up their mind that this was the last Report and would have accepted the Bowes recommendations that these two canals, the Crinan and the Caledonian, should be maintained as a social service. That was the recommendation of the Bowes Report. Moreover, the Bowes Committee said that the Crinan Canal ought to be deepened and widened in prospect of the development not only of industry but also of forestry, in that way helping to facilitate shipping on the western seaboard.

To that extent I agree with the hon. Member, but the matter goes a little further, because Glasgow Corporation has recently been faced with the problem of the desolation of the Forth and Clyde Canal and the Monkland Canal. I do not usually raise constituency points in debates of this kind. I think that there is a main overall trend of economic policy to be followed as far as we humanly can, on one side or the other, but this point is not related merely to Glasgow and the surrounding area. It goes right across the narrow waist of Scotland—for 40 miles.

It is true that aesthetic problems may be raised, but in these modern days, with the expansion of transport between Edinburgh and Glasgow and with diesel engines which make the journey in 45 minutes, it seems to me that there is less need for these canals. I, for my part, and such local authorities in the area as Glasgow and Falkirk, all press the Government to make the decision that these canals should be in-filled at the earliest possible moment. It would facilitate traffic. It would allow development and planning to be carried out all in the one vast field.

The Glasgow local authority, at least, would be very anxious to start in-filling the Monkland Canal. I am sure that my hon. Friend the Member for Coatbridge and Airdrie (Mrs. Mann) will agree that the Monkland Canal is a disgrace and that something should be done. But the Government, in paragraph 11 of the White Paper, go only so far as to say: If work proposed to be done in carrying out redevelopment schemes is eligible for Government grant under existing legislation, applications will be sympathetically considered. That is not good enough. This is a national problem, and the Government must be more forthcoming in what financial aid they are prepared to extend to local authorities, who in this way could provide useful work which would stand the test of time and would fit into the improvement of Scotland's labour position in the future.

I am sorry that the Economic Secretary to the Treasury is not present. When he referred in his speech to the Glasgow Herald, my hon. Friend the Member for Kilmarnock (Mr. Ross) was quick to point out to him that the body of the article did not relate to the headlines. My hon. Friend the Member for Coatbridge and Airdrie then revealed who is now in charge of the Glasgow Herald, which, perhaps, explained a good deal to the Economic Secretary. It was a bad choice to use the Glasgow Herald, because that is the greatest apologist in Scotland for the Government.

Let the Economic Secretary change his bed reading and read the Scotsman editorial of Monday, as suggested by my hon. Friend the Member for Edinburgh, Leith (Mr. Hoy). He will find that the theme of his own speech, which was akin to that of the Chancellor of the Exchequer at Elgin on Saturday, was completely answered and shattered by Monday's leading article in the Scotsman.

The Economic Secretary chided us and rather made fun of the fact that we seemed to be displeased that, although Scotland has one-tenth of the total population of Great Britain, we were receiving one-seventh of the resources. I will not go into the details, but the leader in the Scotsman is very apt on that point and shows that it is simply because of the geographical conditions and the distances prevailing in Scotland that we expect and need that great proportion of the nation's resources.

I do not want to enter into the usual detailed argument about figures of unemployment. There has been a deterioration in Scotland ever since 1951. In 1957, the average monthly rate of unemployment was 56,000. In 1958, it was 81,000. This year, even including the improved figures for May and June, the average monthly rate is 102,500. I do not think that the Government can even claim that the improvement in May and June is sufficient to justify the ebullient claims made by the Minister of Labour and the Chancellor of the Exchequer recently. The hard, dominant feature of Scotland's unemployment figures is that, as has been claimed by so many of my hon. Friends, whether in recession or out of recession, they are twice those of the average for the rest of the country.

The Government have not faced up to that central feature. Apparently they will not recognise it. Further, they will not recognise that it calls for extraordinary measures. In our last debate the Parliamentary Secretary to the Ministry of Labour began his speech by being very disarming and placatory to my hon. Friend the Member for Hamilton (Mr. T. Fraser). He said "Let us talk of the things on which we are agreed. We share the concern of the hon. Member". Sharing concern does not offer any solution to the problem. It is a very nice way to say it, but one must be brutal and say that that concern has been prevalent in Scotland for years, but the Government, even in the dying days of this Parliament, have not yet offered us any solution.

The Parliamentary Secretary went on to say that the Government were agreed that the problem of better distribution of industry in Scotland is not new. It is not new, but after seven years' rule by this Government no fundamental programme has been offered to Scotland. The Parliamentary Secretary then said that the Government and the Opposition were probably agreed on the reasons which had led to the increase in unemployment. I do not think that we are agreed on the reasons for the increase. Certainly, we are not agreed on the motive which lay behind it. What is lacking is a courageous decision to take some action. The Government have signally failed to do that.

If the Government asked me what the Labour Party suggest they should do, I should say that just as a beginning they should consider the plans and suggestions offered by my hon. Friend as convenor of the Opposition's industry group over a long period and which have been summarised in the proposals submitted by the Scottish Council (Development and Industry). I will not repeat those proposals, because they have been mentioned already and are well known.

The one fact we should like the Government to remember always when they are claiming these advances and reductions in unemployment is this. With 85,000 unemployed in Scotland in June, that is a reduction from the previous month of about 9,000. In June, 1958, there were 76,000 unemployed. In June, 1957, there were 49,000 unemployed. It is no use the Government deliberately increasing unemployment and then, when a reduction takes place, asking us and the electorate to extend some adulation and to admire their handiwork. The question is: who created the unemployment? Moreover, seasonal influences are more responsible for the decrease in unemployment than any deliberate action of the Government.

I wish to mention the incidence of unemployment as it affects our young people in Scotland. The numbers decreased last month as compared with the previous month. At 4,000 the figure is still more than twice what it was in June, 1957, when there were only 1,800 unemployed. That is the hard fact with which the Government have not yet reckoned. In the White Paper it is made perfectly clear that, with almost twice as many young people unemployed today as there were in 1957, the opportunities of employment have been halved. Therefore, we have doubled the number of young people looking for half the number of jobs.

Will the Government, even now, reconsider their attitude to the problem of young persons, apprenticeships, etc., in Scotland. We know that they have formed a Central Industrial Council for the training of young people for apprenticeships and the rest, but what they have added is that this is the responsibility of industry alone. They themselves accept no responsibility in this matter.

That will not do. The Government must extend to industry and to the trade unions financial assistance to ensure that in these days, when Britain needs an increasing number of young people of skill and technique to meet the challenge of the modern world and of other countries who are taking these measures, they, too, play their part in encouraging industry in this way.

There is one other problem, which has already been mentioned by at least the hon. Member for Edinburgh, South (Mr. M. Clark Hutchison). I heard only the latter remarks of my hon. Friend the Member for West Lothian (Mr. J. Taylor), so whether he was dealing fully with the problem of the paper industry, I do not know. Hon. Members will know that discussions have recently been held in Stockholm concerning the formation of a "little" Free Trade Area consisting of the Scandinavian countries and ourselves. The aim, which may be perfectly laudable, is to develop an industrial free market between ourselves to gain strength in bargaining power to negotiate with the Common Marker countries.

Another purpose is to bring down tariffs as quickly as possible. The vital factor is increased trade. While those may be desirable objectives, I should like to draw the attention of the President of the Board of Trade and of the Secretary of State for Scotland to this proposal and ask them seriously to consider whether the consequences might not be quite disastrous.

There are two paper mills in my constituency, Edward Collins & Sons, Ltd., of Kelvindale, and the Dalsholm Paper Co., Ltd., both of them excellent and reasonably large mills employing 200 to 400 people. A letter to me from Edward Collins & Sons, Ltd., states: … we are seriously concerned by the latest development towards what is being referred to as a 'Little Free Trade Area' … The proposal … is fraught with the gravest danger to the British paper and board industry, particularly that section of it which is located in Scotland. Here I interpolate that if in the future we extend and take advantage of our forestry industry to produce pulp in Scotland, there may be even greater consequences than my correspondent suggests.

The writer continues: Our industry would have been adversely affected by the general European Free Trade Area originally proposed, since his would have opened the home market to our chief competitors, who, at the same time, control one of the main sources of our raw materials. The new proposal is infinitely more dangerous, however, since it would open our market while leaving Scandinavian paper and board subject to duties in the Common Market countries. My other correspondent has this to say: We would like to bring to your notice the disastrous effect which the establishment of the proposed Little Free Trade Area would have on the paper mills in this country, and in the employment provided by these mills. … In 1957, the Scandinavian countries … exported 570,000 tons of paper and paper board to the United Kingdom and 871,000 tons to the Common Market countries. Those are some of the details which my correspondents would like the Government to bear in mind when considering the whole problem before any final decisions are made in this matter.

There is another direction in which the Government, by their own direct action and control over Departments, can help in Scotland. The White Paper on Industry and Employment in Scotland, for example, refers to the fact that while Scotland had over 9 per cent. of the total industrial labour force in Great Britain, only 2.7 per cent. of the research and development workers in the whole country work in Scotland.

Bearing that in mind, I wonder whether the Secretary of State will consult a table, which appeared in HANSARD of 24th March this year, at c. 1098, showing the allocation of new works of £10,000 and over erected by the Ministry of Works in the United Kingdom. If he looks particularly at the section which refers to research establishments, including Royal Ordnance factories for the Ministry of Supply, the Atomic Energy Authority, the Admiralty, the Department of Scientific and Industrial Research and the Ministry of Agriculture, Fisheries and Food, he will find the following amazing figures, which I ask the House to note.

In the United Kingdom, the number of schemes started since 1st January, 1957, totalled 104, to an estimated cost of £21,300,000. My hon. Friend the Member for Glasgow, Central (Mr. McInnes), to whom I am indebted for this information, asked what proportion of the new works of £10,000 and over had been erected by the Ministry of Works in Scotland. The astounding answer was that of the 104 establishments, only three were in Scotland and that of the estimated total of £21,300,000, the value in Scotland was only £241,500. If my arithmetic is correct, that will be found to amount to 1 per cent. of the total of the works provided by the Ministry.

In those facts and figures, which no one will gainsay, there is a wealth and depth of feeling and criticism which bears out the contention of my hon. Friends on this side that even in instances when the Government themselves, through their own Departments, can influence and direct work to Scotland, they are signally failing to do it and to discharge their duty. The only time when Scotland was helped in this direction was by the Labour Government in the establishment of the Department of Scientific and Industrial Research, at East Kilbride, and by Ferranti; and there are others. It is the publicly-owned industries which are building up research and from and to which private enterprise in many instances is getting and giving great assistance.

I conclude with that appeal. I hope that the revelation of these figures concerning this one item alone will make the Government sit up and that they will ask the other Departments to conduct a searching examination to ascertain in what other directions they can assist in providing work in Scotland. That will obviate the need for the Secretary of State to have to admit, as he did in the last debate, that in 1958 38 per cent. of Scottish graduate scientists and 59 per cent. of her graduate engineers left Scotland.

That trend has been going on for a number of years. It gives great offence to many of us who are interested in education to see the university quadrangles being transferred into feeing fairs and lavish offers being made to young students even before they graduate, offers of attractive jobs elsewhere than in Scotland.

That is something which the Government should consider. The best way in which they can do so is to provide the facilities and the work in the attractive professions, so that our young people will want to stay in Scotland and to provide for their families an education and background where they most want to stay, thereby ensuring that attractions elsewhere do not force them to leave Scotland and add to our emigration figures.

8.10 p.m.

Mr. Patrick Wolrige-Gordon (Aberdeenshire, East)

Ever since my arrival in this House, this subject of industry and employment has been one which has been discussed very regularly. There is, therefore, very little that is new to say, and I do not want to make a long speech this evening.

We all know what the position is and we all tend to describe it on the evidence of our own constituencies. These discussions tend to be slightly repetitive and not, so far as I can gather, very effective, since we are all more or less round the same table and asking for the same pieces of cake.

What I want to discuss, therefore, is not what we are dealing with, but why we have to deal with it. In this connection I should like to associate myself with my hon. Friends on this side of the House who are anxious for some kind of inquiry into the matter. Why should Scotland always have to deal with an unemployment percentage approximately double that of England? It is extremely difficult to find out. I have been trying to do so for quite a long time now—six months or so—and I have had several different answers.

Sometimes, I am told, it is the accommodation, the buildings or the rent, but it is not true, particularly in relation to the concessions now available under D.A.T.A.C. Sometimes people will say - Englishmen in particular—that it is the labour involved, but this is also a heresy. Scottish labour is second to none. More often, I am told, it is transport and the vast distances from the markets which have to be faced by firms situated so far north. But distance is relative, and we do not need a market on our doorstep in order to operate efficiently and with profit. We are not, comparatively speaking, all that much further away from markets than industry in the South, and, particularly if we want to export, all we need are good harbours, and there is no shortage of these in the north of Scotland.

So far as transport itself is concerned, as often as I am told that it is crippling industry I am also told, in fact, that in some cases transport costs are merely a fraction of a penny of the overheads involved. Indeed, the whole question of transport in connection with this problem is very complex and largely unknown. For instance, in the Scottish Grand Committee this morning we were discussing forestry, and in reading up for that debate I discovered that while it costs £20 to send timber from the South to Inverness, it costs only £10 to import the same amount from Scandinavia. If Scandinavian timber comes in by sea, why cannot our coastal traffic compete effectively and at the same rates with trans-North Sea shipping? At least, we should be able to help our own products to complete on equal terms with foreign products in the English market.

It is clear that, facing the realities and the necessities of markets in the South, the north of Scotland—in which I personally am particularly interested—is not the most suitable natural investment ground for certain industries. But the problems which an industrialist has to face there are not insuperable, and I do not think that anything is to be gained by pretending that they are. I deplore this continued exploitation of the unemployment problem by various parties for political reasons, because all it does, as far as I can see, is to create a general feeling of uncertainty and unrest in the areas involved.

In a free economy, which does not depend on Government assistance all the time, and which I sincerely hope we shall always have, the first essential for prosperity, for increased production and for investment is confidence. If we continually attack what is, after all, compared with the rest of Europe, not an unfavourable position, we are going far towards destroying the first essential which we need so much—confidence.

It seems to me that the main barrier against investment in the north of Scotland is a psychological one. As I have said, the physical ones are not insuperable. They have been and are continuing to be surmounted. My hon. Friend the Economic Secretary to the Treasury mentioned three firms in particular, and I have several in my own constituency which are even now expanding and continuing to expand very successfully, and are trading in markets in the south of England. These problems can be beaten and are being beaten, and I hope very much that they will continue to be beaten. I personally refuse to join in the dirge about the situation usually indulged in by hon. Members opposite. It sounds to me very much like the pibroch, lonely and haunting, in the political wilderness.

At the same time, I think something more specific could be done to investigate the kind of factors which are affecting the present position in the country. I have been trying to find out for a very long time exactly what it is that goes wrong, and while I have had a number of different opinions, I can truthfully say that I have not had one single conclusive one. At any rate, there has been nothing specific enough to offer me any satisfaction, and I think that there is a case for some kind of inquiry into the various factors affecting the success or failure of particularised industries or firms. Until we know exactly what the problem is, surely we cannot deal with it at all, either by Government assistance or through private enterprise.

There is one final thing I should like to say which, more or less, follows from the speeches of the hon. Lady the Member for Coatbridge and Airdrie (Mrs. Mann) and the hon. Member for Dundee, East (Mr. G. M. Thomson). This is connected with a very good series of articles in the Aberdeen Press and Journal, which newspaper has been conducting a survey of the Aberdeenshire families in Corby. I have no idea why we should not have a Corby in the north of Scotland. Why should these families come down to England in order to find conditions of work which they need? I do not see why we should not have some kind of effectively industrialised belt in the north of Scotland, a kind of industrial centre which would be able to absorb and, at the same time, stimulate the creative ingenuity and skills of the people in that part of the country. We have everything up there, including a great enthusiasm for work, and there is no reason why it should not be a great success in this case. Further, following on what was said by the hon. Member for Dundee, East, who spoke of big firms attracting small firms, I can see no reason why that kind of success should not bring still more in its train.

8.20 p.m.

Mr. John Rankin (Glasgow, Govan)

I am sure that when the hon. Member for Aberdeenshire, East (Mr. Wolrige Gordon) reads his speech tomorrow he will feel that he would like to alter some of the things he has said. While it may be true that God is in his heaven in East Aberdeenshire it is not true of many other parts of Scotland, and particularly of that part of which I should like to speak—

Mr. Wolrige-Gordon

I did not mean to imply that God was in his heaven in East Aberdeenshire. What I meant was that, comparatively with other European countries, our position was not quite as bad as hon. Gentlemen opposite try to make out.

Mr. Rankin

That is a qualification already, before the hon. Member has read his speech, but the hon. Gentleman led us to believe that though God might not be in his heaven in East Aberdeenshire, all was well. That is not true of Scotland as a whole.

I want to refer, in particular, to the shipbuilding industry. It is an industry of tremendous importance to Scotland, including East Aberdeenshire, because, when it is healthy, engineering, the electrical industries, painting, plumbing, furnishing, and a whole host of other dependent occupations are also in a sound and prosperous condition. One out of every 12 persons employed in Scotland is dependent on this great key industry. In Clydeside, the figure is even more impressive, because in my area one out of every eight persons depends on shipbuilding in one way and another to earn his or her daily bread.

At the moment, that industry is on the decline, not because of any dirge that has been sung by the workers, or because of anything expressed here, but because of conditions over which the workers in the industry and, indeed, many of the employers, too, have no control. That decline is well illustrated by these figures. In 1930, the United Kingdom launched 1,472,000 tons of shipping, equal to 51.9 per cent. of the world output. Last year, the United Kingdom launched 1,402,000, a diminution of 70,000 tons which represents a changed percentage that is revolutionary in its significance. The United Kingdom percentage is now only 15.1 per cent. of the world total.

Last year, Japan launched over 2 million tons, and we now have a whole host of maritime countries entering this market—Germany, Sweden, the Netherlands, Italy, France, Norway, Denmark, Poland, Spain and the United States of America. Every one of them has increased its output over that of 1957. And while Britain's output fell in 1957 by 12,000 tons. Scotland's output fell by 50,000 tons.

In addition, it is worth noting that last year the biggest ship launched in the United Kingdom was the "British Duchess", from Clydebank, a vessel of 42,000 tons deadweight. In that same year Japan launched the "Universe Apollo" of 100,000 tons deadweight, three other ships of 50,000 tons gross weight, one of 31,000 tons, and three of over 30,000 tons. Germany, the United States of America and these other countries I have named also launched bigger ships. According to the American Maritime Commission The United Kingdom has been eliminated as a competing shipbuilding centre, and it is not foreseeable that it will become a serious contender in the near future. From those facts, two questions emerge. First, can the present high rate of world shipbuilding be maintained? Secondly, can we retain our position—or regain our position in the forefront of the world's shipbuilders—should there be a slump? To find the answer to the first question, we must take into account the present state of world trade. In 1958, the world's fleet stood at the biggest-ever figure of 110 million tons, but it was not fully utilised. Even if trade were restored to its 1957 level and the fleets were fully occupied the 1958 level of shipbuilding could not be maintained. I should like to ask the hon. Member for Aberdeenshire, East to think over those things, and not to criticise us as lightly as he has just done.

If we assume that the average life of a ship is twenty years, to renew the existing world fleet would mean an annual output of 5½ million tons. Before the war, the normal output was 3 million tons. That 5½ million tons is a maximum possible figure that no responsible shipbuilding authority—and I have consulted knowledgeable people on this matter—believes to be a practical estimate of world shipbuilding needs in the future. We therefore arrive at the conclusion that there will be a very drastic fall-off of shipbuilding orders in the near future, and Dr. Dennis Reddick, Deputy Manager of Harland & Wolff, confirmed this view when he wrote the article in the Glasgow Herald Trade Review to which the Economic Secretary referred.

Dr. Dickson Mabon

But he did not read that to us.

Mr. Rankin

He did not do so, because it would not have been to his advantage.

If the shipbuilding requirements of the future are confined to replacement programmes, because there is no purpose in building new ships in this state of affairs, the existing shipbuilding industry will be employed to the extent of only 50 per cent. The Secretary of State knows something about this. We are perfectly entitled to do what the back benchers on the other side have not done so far; ask the Government what they intend to do in this situation.

In spite of improved techniques and more than £100 million invested in modernisation, the launching output over the country as a whole—I am, of course, referring to the United Kingdom, because we cannot consider Scotland as a separate entity in this matter—has been practically static for the last five years. In that period there have been remarkable developments abroad, particularly in Japan and Germany.

Holland is expanding her shipbuilding capacity. Portugal is developing its second six-year development plan to expand its capacity. A new yard is opening in Brazil, and a new yard is about to be opened by Mr. Niarchos in Greece, which will include a German floating dock to take ships of up to 65,000 tons deadweight—something which those of us concerned with Clydeside will not see for long years to come if this Government, unfortunately, remains in power.

The Iron Curtain countries are expanding their industry, perhaps due to their inability to get contracts placed here. Let us remember that the Germans are now building 10 factory ships which we refused because of the cold war. Last year, Norway opened its biggest building dock and ships up to 65,000 tons can be built there, while provision has been made to expand it to take ships of up to 120,000 tons. In Japan, the fourteenth short shipbuilding plan is now in operation. Even Communist China claims that the fast building times which have been announced by the Japanese have been surpassed by China. Three years ago, when I was in China, they were only thinking about launching into shipbuilding, and now they are claiming that in speed of construction they can beat anything else in the whole world.

That is the situation which confronts us, and it is the situation which has led to the decline in shipbuilding in Scotland, which has led to the fear that is developing in the shipbuilding yards. In the June issue of British Shipping this is said: There comes a time in the history of an industry when warning signs point unmistakably to danger ahead. It said that that stage was reached years ago.

The Government are hardly awake even now to the danger which exists. This is emphasised by the position of Liberia. Ten years ago Liberia, as a maritime nation, was represented by a single ship of 1,000 tons. Today, Liberia has the second largest trading fleet in the whole world, registered under her own flag and totalling 11 million tons gross.

I want to quote one figure just to illustrate how this set of conditions is bearing back on our industry. I return to my own area, Clydeside, which has been recognised and accepted as the greatest shipbuilding area in the whole world. In my division I have Harland and Wolff's, Fairfield's, and Stevens, of Linthouse—yards which are known all over the world. Every one of them today fears the danger of unemployment.

Unemployment on Clydeside is not confined to Clydeside because, as I have said already, the ramifications of the shipbuilding industry are so vast. Unemployment on Clydeside would affect the whole of Scotland, including East Aberdeenshire. Orders received from overseas in 1955 were 188,000 tons and last year they were down to 2,000 tons. That is a shattering thing to happen, and we must do something about it.

I want to look at one or two things which we might do. I am leaving out some of the figures which I should have liked to put, but they are fairly well known and the problem which I am stating is generally accepted. As a result of what is happening to industry, something is also happening to the individuals concerned. We are now engaged in great plans for educating people to go into industry, but if we do not have the jobs we shall not use fully the skills and aptitudes which we are helping to create.

Therefore, in a way, there are two problems here—the problem of physical unemployment, the losing of a job, and also the problem of mental unemployment, or under-employment in some cases, due to the fact that mechanisation and modernisation have expanded so far that the educational endowments with which people enter industry today are not being fully utilised.

Recognition of this puts a question mark against the whole structure of the type of society in which we live. If we do not recognise this problem, the frustration which can develop may well result in an industrial retardation which would be dangerous for us as a nation. Accepting the problem stated, what are some of the things that we must do? We are living in a changing society where redundancy would seem to be inevitable. The first thing that we must do is to safeguard the standards of working men and women who are in industry. For that reason, I suggest to the Secretary of State that in safeguarding the in dividual he must think, of the problem of compensation on the termination of employment.

This idea is not exactly new. It has been adopted in some countries. In Belgium, it was adopted by legislative enactment. In other countries, like the United States, it has been adopted by collective agreements. In this country it is already accepted and practised on a small scale by ad hoc settlements in many private industries and by agreement in a great many public industries. Something on a much wider scale is now needed. It is now a national problem and not one which can be left to the good will of individual employers.

I urge this on the Secretary of State, because it is important and because he need not be timorous about it, since he has good support. In November, 1950, a Private Member's Bill was introduced by the present Parliamentary Secretary to the Ministry of Labour, who was with us earlier today, but who is no longer in his place. It was supported by the present Minister of Labour, the present Paymaster-General, the present Government Chief Whip and an ex-Chancellor of the Government, the right hon. Gentleman the Member for Monmouth (Mr. P. Thorneycroft). In prosecuting the idea before the Cabinet, the right hon. Gentleman should have some powerful allies on his side. The purpose of that Bill was "to entitle certain wage earners to a statement setting out the conditions of their employment and the terms upon which, if their employment were terminated, they should be compensated."

That is important, because there is a conflict between a workman's desire for security in his job and the national need for mobility of labour. That conflict is possibly at the bottom of many of the troubles affecting us today. There is nothing new in this proposal, because it has already been accepted in certain quarters. Lieut.-Colonel Kingsmill, who was threatened with the loss of his job, has been promised that if he does lose it, he will get £60,000 compensation. Sir Charles Colston, of Hoovers, got £83,000: Sir Frank Spriggs, of Hawker-Siddeley, got £75,000; and Mr. George Pate of Albion Motors got £60,000—all tax-free. If the principle is good in those cases, it must be equally good when applied to the community as a whole.

Because of the state of shipping and shipbuilding, the Government, the trade unions, the shipowners and the shipbuilders have got to get together. They have to think out what can be done. I have already suggested that, but I cannot find a Minister, at any rate at Question Time, who has responsibility for a matter of this sort. I am now putting it to the Secretary of State. World capacity to produce ships is now three times more than world demand for ships. Therefore, we have, first, to think of a policy of scrapping ships beyond an agreed age Secondly, we have to think what we can do with the scrapped ships, and I suggest that the steel mills are waiting for them, because there is a demand for steel. Thirdly, we have to think of revising the strategic list.

This afternoon I put a Question to the President of the Board of Trade on this matter, reminding him that last autumn he removed Dakota aircraft from the strategic list, which he regarded as a great achievement. He might as well have removed Noah's Ark and imagined that that would in any way help trade with Russia. Last weekend the Russians flew the TU114 from Moscow to New York, nearly 5,000 miles, in a little over 11 hours non-stop. Yet the right hon. Gentleman thinks that we are making progress when we remove the Dakota aircraft from the list of banned exports on strategic grounds.

My fourth suggestion is that we must have fuller employment of our scientific "know-how". We have a great background of scientific knowledge. In many ways we are ahead of most nations in the world today, but we are not fully using that knowledge. If we were, we would have not only more employment, but it would be more highly skilled employment that would make greater use of those abilities and attainments which many workmen in industry today have.

Next, we must try and reach international agreements. At present, there are restrictions and reservations in favour of national shipping all over the world. There are preferences in port charges and there are artificial aids through licensing control. Every one of those things threatens British shipping and British shipbuilding. We must get some sort of agreement on this by the creation or the expansion of the powers of an international agency which I know already exists with regard to rates and fares. We must try to expand its powers.

We have the International Civil Aviation Organisation and the International Air Transport Association in relation to airways doing good, useful work. We now want something of that nature for the seaways, to try to relate the increase in the amount of tonnage afloat to the requirements of world trade.

Those are suggestions which the Secretary of State must consider. The first suggestion that I made about terminal compensation is urgent, because if unemployment spreads there will be serious danger. We cannot expect people always to behave quietly when their very existence is at stake. I hope that when the Secretary of State replies he will give his views on what he proposes to do about the suggestions that I have made. My suggestions are not cures. They are attempts to relieve the dangers which lie ahead of us if the unemployment situation is allowed to get out of hand.

8.49 p.m.

Sir James Henderson-Stewart (Fife, East)

The House was good enough to listen to me when we discussed this White Paper on a previous occasion. I do not therefore complain that very little time is left now for me to speak. I am glad that my right hon. Friend the Secretary of State is present tonight, because it may be that I can amplify a little the proposals which I made on the earlier occasion.

This debate, like the previous one, has taken the usual form. On the whole, the Opposition have painted a rather dreary picture of Scottish conditions. The hon. Member for Coatbridge and Airdrie (Mrs. Mann), who made a very moving speech, was speaking of her home conditions, and she is entitled to tell the House what she thought, but the general picture has been exaggerated and has left out of account much of the fine work done by the Government and other agencies in the last few years. I wish that there had been time for me to produce a more balanced picture.

Tonight I am concerned with the question of what we should do in the future. Everybody has agreed that something is wrong. There is a consistently larger percentage of unemployment in Scotland than in England. There must be some reason for it, as my hon. Friend the Member for Aberdeenshire, East (Mr. Wolrige-Gordon) said. What is that reason? Many inquiries have been carried out into individual aspects of the Scottish problem, but there has never been a comprehensive survey of the state of our economy as a whole. It is partly because of that that there is not available to the country and the Government the body of advice that should be available.

Mr. Bence

The Cairncross Committee.

Sir J. Henderson-Stewart

That dealt with only one aspect of the matter. We must have a proper survey, taking into account all the matters affecting Scotland.

The hon. Member for Glasgow, Govan (Mr. Rankin) made an interesting speech on the shipping industry. It is a questionable whether, in the years immediately ahead, we shall continue to enjoy great prosperity in that industry. It surely cannot be right that Scotland should drift into this new age without having seriously thought of what might happen. If things did not go successfully in shipbuilding, as the hon. Member for Govan said, great parts of Scotland would be adversely affected.

What is the future of the coal industry in Scotland? Day by day we hear of the closures of pits, and the chairman of the Coal Board has indicated that there will be further closures. Is there a long-term plan for coal? Is it likely to affect the general economy of Scotland? There is also the problem of foreign investment. It is assumed by the Scottish Council that there will be a continuation of American investment in Scotland, or that investment will come from some other country. Can we count upon that in the years immediately ahead? What happens if the Common Market does not develop as we should like to see it develop?

These are some of the broad and fundamental problems which some skilled body of Scotsmen should be examining now, with a view to charting the future course of our economy. It is not enough to say, "We will put up a few more factories, in the hope that somebody will fill them." That-is not a policy. We hope that factories will grow up round the great strip mill development. I fervently hope they will. But this aim will not be achieved by our saying, "There will be a factory here and another factory there." Plans must be made. [HON. MEMBERS: "Hear, hear."] I hope that I am not being misunderstood. I do not mean plans made and carried through by central Government alone.

Mr. Willis

Who will do it?

Sir J. Henderson-Stewart

I am striving to get a consensus of opinion of skilled men in Scotland—the kind of commission that I have suggested on the previous occasion. We want men who will sit down and think out the problem of Scotland's economic and industrial development in the course of the next five or ten years. It may be Government enterprise or local authority enterprise; it may well be mostly private enterprise.

I think we waste the time of the House by pursuing the barren argument about whether something is capitalism or Socialism. The truth is that we are faced with very hard conditions which we have to examine and we must produce some severely practical solution. We have long passed the age of laissez-faire; similarly we have long passed the age of depending on nationalisation which in one election after another has proved no good—[HON. MEMBERS: "No."] Yes, the truth is, as hon. Members opposite know perfectly well, that if we are to make a success of the industry of Scotland and indeed of the rest of the country, there will have to be a synthesis of effort, a co-operation of effort—private enterprise, local authority and Government—and we must all play a part. [HON. MEMBERS: "Hear, hear."] I am glad that we all agree; because this is precisely what the Government are trying to do now.

I hope, therefore, that we shall not waste time on barren, useless, academic arguments. I want a commission of inquiry which will be strictly practical, carried out by men with knowledge and understanding of the development of Scotland in the future. I think it would be helpful to the nation to have such a commission appointed by the Government, with strong and broad terms of reference to cover the whole economic future of the country.

I am sorry that it is necessary for me to concertina this argument because of the lack of time. I hope that my right hon. Friend will consider this suggestion which I make with complete sincerity, as he will know. Such an inquiry would be valuable to the country, and were it properly manned, I think it could be completed in eighteen months. I hope that out of such an inquiry would come a blue-print for Scotland's future in the next five or ten years, indicating the broad lines along which the nation should move as a whole. I hope we shall not turn that idea down because it is something new; or because it has not been tried before; or because it does not line up with one philosophy or another. I am asking for a strictly practical, businesslike, thorough examination of Scotland's problems so that we may create a viable economy for the future.

8.58 p.m.

Mr. William Ross (Kilmarnock)

It is probable that this will be the last survey of Scottish industry and the employment and prospects for our people which will be conducted in this Parliament. But there would appear to be a feeling—at least the hon. Member for Fife, East (Sir J. Henderson-Stewart) seemed to indicate it—that this is not the last but the first survey. May I remind the hon. Member and his hon. Friends that consistently since 1951, when the economic well-being of Scotland passed to the control of the party opposite, we have had a debate such as this year after year. We on this side have instituted the habit of devoting each year not one but two days to those debates.

As I listened to the speech of the hon. Member for Fife, East I could not help recollecting the first debate that we had on the subject of industry in Scotland—in 1952. The hon. Gentleman should remember it too, because he was the Minister who answered. I wonder whether he remembers what he said; but, much more important, does he remember the questions that were asked him? The opening speech of that debate was made by the late Hector McNeil. I will give in his own words what the hon. Member for Fife, East said then. He said: The right hon. Gentleman finished on a note of inquiry and of imagination. He was searching for the answer to Scotland's long-term future. … He asked: What is our future"— I would ask the House to note these words of the hon. Gentleman— what new industries should we seek to get, what sort of technical staff should we establish, what is our strategy? That is exactly the kind of thing that the hon. Member for Fife, East is now suggesting should be done. In the debate of 1952 he instanced his own constituency and referred to his own knowledge of the mining industry. He said: I know that problem. It may be that we can do something about it. I should certainly like to be able to do something about it. He was the Minister responsible. Seven years later he is asking for the establishment of something which he then had it in his power to achieve.

Sir J. Henderson-Stewart

Much has been done since then.

Mr. Ross

We will come to that. I want to remind the hon. Gentleman of what he said in 1952 about what has been done in the post-war years, done by the Labour Government. He said: There is and has been throughout the post-war years great confidence and buoyancy in Scotland—far more than I see in other parts of the country; it is due, I am sure—and I do not deny credit to Government agencies and officials—to this unique voluntary co-operative effort on the part of Scotsmen and women of all grades and classes … It has served Scotland well, and I am sure that if we can continue with that spirit … there is no doubt about the future of our country."—[OFFICIAL REPORT, 10th July, 1952; Vol. 503. c. 1555–7.] The economic destiny of Scotland has been in the hands of the hon. and right hon. Friends of the hon. Member for Fife, East since that time. Here is the position. In 1952 we had a similar debate to the one we are holding tonight. Then the figure of unemployment for Scotland was 42,300. Here we are, in the last July of nearly eight years under a Tory Government, and the unemployment figure is 85,200, more than double what it was then. That is what the hon. Gentleman and his hon. Friends have been able to achieve.

Mr. William Hamilton (Fife, West)

Answer that one.

Mr. Ross

I could give the hon. Member for Fife, East quotations from his replies in 1953, 1954, and so on.

We kept asking for that overall plan for Scotland. I and my hon. Friends remember that before the debate we had in 1953 we saw the Minister of Labour, now Lord Monckton, the Minister of Supply, the President of the Board of Trade and the then Secretary of State for Scotland, the right hon. Member for Moray and Nairn (Mr. J. Stuart), and asked them to prepare a blue-print for Scotland to show what it would be like ten years ahead. We were interested then, as we are now, not merely in unemployment but in employment and the future of Scotland. Our alarm is not at the failure of Scotland and the downfall of Scotland, but at the impotence or indifference of the party opposite to take the steps which must be taken if Scotland's destiny is to be assured. What we fear is our people going through another period of hardship and travail before what today is obvious comes to be done.

In January, 1953, the winter peak figures of unemployment were 81,000. Here is the great achievement up-to-date. The Chancellor of the Exchequer, in that strange and quiet visit to Elgin, told us that the unemployment figures have gone down steadily since January of this year. He added that he felt they would go down again when the figures were issued, a few days later, for June. The figures have been issued for June. This year, after seven and a half years of Toryism, the figures are 85,200. The summer low, after eight years of Toryism, is higher than the winter peak of 1953—a very considerable achievement. The hon. Member for Ayr (Sir T. Moore) said we painted a gloomy picture.

Mr. Willis

He was almost crying.

Mr. Ross

He nearly had the whole House crying. His was the gloomiest speech we have heard. He was taking us to task for painting a gloomy picture, but it is against this worsening position, against this constant demand year after year for the production of an effective policy and plan for Scotland and the failure to get it, that the picture we have painted today has to be judged.

If we were at the end of the road, it would not be so bad, but we know quite well that even with 85,000 unemployed that improvement last month of 9,000 is not an improvement that will last These pompous predictions of the obvious are getting me down a wee bit. The Minister announces in the month of May that the unemployment figures will fall next month. That is not surprising as they have fallen in the summer ever since figures were taken. But it is equally true that they have risen in the winter. We go back to the speech in 1953 of the man who was responsible for making the speech made by the hon. Member for Fife, East today, the man who now is Minister of Labour and who then was Parliamentary Secretary to the Minister of Transport. He was quite honest—1 wonder if the Secretary of State will be as honest tonight—to point out that the inevitable decline of the figures in the summer would be followed by the inevitable climb of the figures in the winter.

I am going to do a little bit of prediction of the obvious. Even with the present policies of the Government, or lack of them, we are going to have 100,000 unemployed in Scotland this winter. I wonder if the Economic Secretary to the Treasury or the Secretary of State for Scotland is prepared to deny that? Let me tell them what is happening in respect of Scottish employment at present, this week, next week, next month, even this year and so far as we can see ahead, in respect of some industry. In Burntisland shipyard a hundred men are being paid off. They are not included in the figures which we have already got. This is gloom to come. Let us have no more Treasury humour about it because for the men involved it will be a pretty dismal summer.

Mr. Hamilton

Does my hon. Friend recall that I described the case of a skilled man who was sacked in Burntisland a fortnight ago and who asked me to write to new towns in England to get him a job because he could not get one in Scotland?

Mr. Ross

We have this position on the railways and in the workshops in Inverurie. I wonder whether what is happening in this part of Aberdeenshire did not reach the ears of the young hon. Member for Aberdeenshire, East (Mr. Wolrige-Gordon). We have the position in Cowlairs, St. Rollox and Kilmarnock. There are 400 men faced with redundancy, though redundancy on the railways means not only men losing their jobs but being transferred to other areas. There are men who have already left Aberdeenshire, and who are working in Swindon. This is another avenue of local employment that is closed to young people.

From Prestwick we have the sad news of 400 people of the staff of Scottish Aviation Ltd. joining the 600 who have already been sacked. There is no redundancy scheme for them. There is no placing them in other industries. Private enterprise does not accept the obligations accepted by nationalised industry. I agree with most of what was said by the hon. Member for Ayr. Is it not a tragedy for Scotland that the Government are prepared to allow this to happen to this valuable team which has produced a valuable product and one whose efficiency and worthiness has been recognised by the Air Force of this country, the Air Force in Malaya, and by companies throughout the world? I am not at all satisfied that enough has been done. I recognise the failings of this private company. It is all very well for the hon. Gentleman to tell us that we are wrong in suggesting that the Government should do something about this and for him also to insist that Scotland's future should depend on the vitality of private enterprise. Look at the result.

Here we have a company whose entire sales department apparently consisted of one man. The jobs of these 2,500 people depended on that and they are jeopardised by one unhappy event. I ask the Secretary of State, even at this late hour, to do something to ensure the growth and build-up of that aircraft industry in Prestwick. It is one such industry that we can point to in Scotland. Let us remember the money poured into the aircraft industry in the South. It is not just a question of the Pioneer aircraft. The Pioneer will go on. What we require in Prestwick is something after the Pioneer. That is what these men should have been doing and working on, supported by the Government. They have not had that support.

I have a long list to show where unemployment is growing. There are still men to be paid off in the Royal Ordnance Factory at Irvine. There are men out, not included in these figures, in the dockyard at Irvine. I wonder if the Secretary of State knows the latest news from I.C.I. at Stevenston. The works manager called the men together last Friday and told them that the safety fuse department and the black powder department were to close down. In one case it employs about 350 men and in the other case about 150 men. He said that the work was being transferred, not to England, but in one case to a factory being built in Africa and in another case a factory being built in India. This is looking ahead a year or two years. But anyone who knows what has already happened in I.C.I. over the past year, and who knows how the whole life of Northern Ayrshire was dominated by I.C.I., realises that the outlook is black. In Ayrshire, we already have over 5,800 unemployed. In the old industrial district we have 3,500. It will be well over 4,000 unemployed as a result of this week's events.

Against these figures we measure the Government's policy. I asked the President of the Board of Trade how many new projects had been started in the Ayrshire Development Area in the last year. I was told that there had been two new projects which, when completed, would provide jobs for 178 people. Can anyone wonder that we are alarmed and despondent? We are also told that Massey-Harris-Ferguson of Kilmarnock intends to transfer its engineering department from Kilmarnock to Coventry. Yet another team of engineers and draughtsmen is to be lost to Ayrshire. These are fifty valuable men. Another 100 engineers are involved but they will probably be found work within the production unit. But we shall have a production unit whereas previously we had a creative unit. There is always a danger, which is in the minds of certain people, that it might be easier for them to close down the Kilmarnock branch of the factory.

This is centralisation of a department. We should blame the Government, not private enterprise, for it. My hon. Friend the Member for Greenock (Dr. Dickson Mabon) will remember the unavailing fight he had against centralisation in respect of Admiralty departments. Cannot we have some centralisation of these jobs in Scotland? Why should we not centralise engineering departments in Scotland, the home of engineering? When we put these suggestions to the Government they say, "We must leave this to the commercial judgment of private enterprise." We remember the tragedy of Scotland's lost opportunities before the war, the stagnation and the decay and the misery, which we knew as a result of a Government which did not believe in interfering with private enterprise. Have we to learn that lesson all over again?

I return to my list, my catalogue not of things which have happened but of things which are to happen. First, there is Donibristle, where 100 men are still to be paid off. There is Standard-McLean at Hamilton, 250 men. There is Bo'ness dock. Although the men employed there will be on the register at Grangemouth, it will probably mean a loss of earnings to many people.

Mr. J. Taylor

Probably about 100 of those who work in the timber yard which the docks supply will be displaced.

Mr. Ross

There are also the Menzies Leith ship repair works, thirty men to go there. We learned from the newspapers the other day that George Brown of Greenock have launched their last ship. More unemployment there. We have the serious situation in mining. We have the railway situation, apart from railway workshops, with the closing of the branch lines. We have the loss of employment of about 140 people due to the changes being made between Inverness and Wick. They are in remote areas where it is difficult to find jobs. All the time the Secretary of State will not take the necessary steps to use what influence he has to ensure that the Government's approach to Scotland recognises the obvious fact that Scotland requires a different policy from the rest of the country.

Now I come to the Economic Secretary, if I can find his rigmarole. He said that Britain's economic recovery was taking place, but Scotland had not shared in the recovery. Not only has it not shared in the recovery, but the measures taken by the Government to create unemployment, in which they succeeded, hit Scotland harder than the rest of the country. Not only are we not recovering so quickly, but we were knocked further down. Surely the obvious arises from that. In their overall general policies the Government should recognise the vulnerability of Scotland, and it should be sheltered in the general economic policies, in relation to defence cuts, and the like.

We were told of the rather facetious attitude adopted by the Chancellor of the Exchequer at the open air rally at Elgin. He told the people of Scotland that we were expensive luxuries, that we cost the Treasury a lot and that we received more than our share of certain things. There is another thing of which we receive more than our share, namely, unemployment. Last year we lost 4,000 jobs as the direct result of calculated cuts by the Government. That information was received in reply to a Question which I tabled to the President of the Board of Trade. The loss of 4,000 jobs is the result of direct Government action in this respect—naval workshops, Royal Ordnance Factories, etc. This is what I mean by saying that, recognising our vulnerability, there should be a different policy. The position is not good. The Economic Secretary quoted the headlines of the Glasgow Herald supplement. He should have gone a little further and quoted from the article. Mr. D. J. Robertson, Senior Lecturer in Political Economy at the University of Glasgow, said: A brief look at existing Scottish industry suggests a decline in the number of jobs available in some sectors rather than growth. Some of Scotland's basic existing industry seems more likely to decline than expand in the next few years, whilst our immigrants from England and America can hardly be predicted as becoming more numerous. That is the outlook as foreshadowed by Mr. Robertson. The outlook in shipbuilding was well stated by my hon. Friend the Member for Glasgow, Govan (Mr. Rankin). The outlook for steel was mentioned by my hon. Friend the Member for Coatbridge and Airdrie (Mrs. Mann). I personally deeply and sincerely regret—I am sure that I am speaking for the rest of my colleagues—that the speech my hon. Friend made tonight was her swansong. I have known the hon. Lady, and she has known me, since I was a boy. I have known her speak on platforms all over Scotland, particularly in the Low Green at Ayr. Always she has been fighting outside for the same cause as that for which she has been fighting inside this House, and I am convinced that she will carry the banner of that fight with her even after she leaves the House.

Tonight she spoke about the condition of steel. I have here a report from Mr. Bell, the manager of the iron and steel works of Stewart & Lloyds. The Clydesdale factory, the company's Lanarkshire steel and tube works, manufactures the heavy tube and pipe used for oilwell pipeline and refining construction. He says in his report that the international situation is complex. That is putting it mildly. We have heard talk about the humour of the speech of the Chancellor of the Exchequer at Elgin. The only humorous part was where he said to the assembled populace: I am sure you want to leave our international affairs in the experienced hands of Mr. Macmillan and Mr. Lloyd —these stars of stage, screen and Suez. Mr. Bell continued: There is no firm indication of any early revival in demand for casing, tubing and line pipe for the oil industry. The 1959 prospects are not favourable and reduction in turnover in 1959 as compared with 1958 would not be surprising. For Lanarkshire, therefore, the position will be worse, resulting directly from something in which the Secretary of State has a hand, because he speaks for Scotland in the Cabinet, even in foreign affairs and vital decisions. Suez led inevitably to Iraq, and Iraq has meant a halt to the expansion of the oil companies in their great capital projects which directly affect Scotland. That is the international situation—the Middle East—that the Chancellor talked about. Scotland has indeed suffered from the party opposite.

The Economic Secretary said that this was no new problem. That was no new statement. In 1953, the present Minister of Transport and Civil Aviation, when Parliamentary Secretary to the Ministry of Labour and National Service said exactly the same thing. The only thing that the hon. Gentleman spared us today and which we usually get from the Dispatch Box when somebody comes into a Scottish debate was the usual sort of rather facetious, patronising pleasantries. We were spared that today.

Mr. Erroll

I did not do that.

Mr. Ross

I had my criticism of his speech all ready—"Patronising pleasantries, followed by a restatement of the well-known, a dessertation on specialised subjects of interest to the hon. Gentleman himself and a proclamation of the Government's unflagging interest in Scotland." I wrote this out yesterday. The only thing in which I was wrong was the patronising pleasantries. After reading what the Scotsman had to say about the Chancellor of the Exchequer, the Economic Secretary thought he had better skip that.

The present Minister of Transport and Civil Aviation, when Parliamentary Secretary to the Ministry of Labour and National Service, said that what was required was new thinking. That was six years ago. Our alarm is that we have never got that new thinking. Today, the position is worse than ever, with Scotland in the position that its basic industries—coal, shipbuilding and steel—are in the way of such change and contraction that Scotland's present population will not be employed. Is the future of our young people to be emigration or, according to the new Highland policy? Are they to become caterers, cooks and bottle-washers? Is that to be our future?

I am indeed disappointed. I hope that we do not get from the Secretary of State the sort of wishy-washy replies that we had before. The Economic Secretary wondered why we got rather tired of his dissertation on D.A.T.A.C. The reason is that I can say in one sentence what he took twenty minutes to say. What he meant to tell us was that the Board of Trade had received fifteen more applications, that seven of them had been recommended and that £30,000 more was involved. That was what he took twenty minutes to say. We got most of this from the Secretary of State last time, and it is not good enough.

The Government's policy does not measure up in any way to what needs to be done, because we see private enterprise too often content to hold out the begging bowl, while we get from back benchers opposite criticism of the nationalised industries, though the Economic Secretary showed us today that the nationalised industries of the people are going ahead, despite the difficulties placed in their way—

Sir W. Anstruther-Gray

The Coal Board?

Mr. Ross

Yes, the Coal Board, which is opening pits today—

Sir W. Anstruther-Gray

It is shutting down pits.

Mr. Ross

—the first to be opened in this century. New pits are being opened by the Coal Board.

I feel that what we want at this late stage is not a policy from the Government, but just their resignation. They just have not got the courage to solve this dilemma. They want a plan, they need a plan, but a plan is not enough. It has to be implemented, and the implementation of that plan can only come from a Government who have the courage to act. They are not prepared to take the obvious step of putting the plan into force so that we in Scotland may benefit from that plan. We cannot rely on the irresponsibility of private enterprise, as even I.C.I. will close down in Ardeer and build factories in India. It has no responsibility to Scotland. It has responsibility only to profit and to its shareholders.

The policies of the Government in no way measure up to the needs of Scotland. We need a Government who are prepared to accept responsibility for the well-being of this nation—both its social and its industrial well-being. It is essential that they should have a plan and that they should retain and use the power to intervene, guide, stimulate, establish and foster industry, consistent with an overall vision of a strategic policy.

I think there will be more than one swan-song tonight. I think we shall have a swan-song from the Secretary of State. His successor has already been picked.

Mr. Patrick Maitland


Mr. Ross

As for the right hon. Gentleman, I only want to say this of him. [Interruption.] The longer the interruptions, the longer I will stand here. The right hon. Gentleman has had his opportunities. He has not effectively used them. He should have spoken for Scotland in the Cabinet. It is all very well for him to say that he did on the steel strip mill. We have had such a glowing tribute about it from the Economic Secretary to the Treasury that we wonder why it took so long to get it. The right hon. Gentleman's hon. Friends will look back in sorrow, while we on this side will look back in anger, when he himself goes down, not Unwept, unhonoured and unsung. He will go down "unwept and unsung," but he probably will be honoured—in another place.

9.34 p.m.

The Secretary of State for Scotland (Mr. John Maclay)

I, too, have made a forecast of what the speech of the hon. Member for Kilmarnock (Mr. Ross) would be. The trouble about these debates is that we are getting a bit too inbred. The same people are arguing with each other day in and day out, week in and week out, month after month and year after year, and we always know what each other will say. I was wondering at half past nine, when I understood that the hon. Member for Kilmarnock would sit down, though he has exceeded his time, why he had left out his usual winding-up reference to myself. In fact, I felt almost encouraged, because I had not had the usual personal attack on myself. Now, however, the hon. Gentleman has completed the job, so that his speech is exactly what I expected.

This debate has been highly constructive, even more highly constructive than the earlier debate, but I must put in balance the Scottish scene. Practically all hon. Members opposite have spoken with justice on the detailed problems in their own constituencies and the detailed problems affecting industries in Scotland, but not one has spoken of the things that are happening in Scotland that are extremely good.

If I now turn for a few minutes to the brighter side, it is not because I am complacent about the bad parts in the Scottish scene, but because I think that it is extraordinarily dangerous, in a debate like this, for it to go out from the House of Commons that we Scots think only gloom, gloom, gloom about our own country. That is very bad and very dangerous. We have our problems, and it is right that we should recognise them. It is right that we should argue about them and press the Government of the day to deal with them, but it is equally right to look on what is good and what can develop and is developing; to hold out hope for the future, and not adopt the attitude of despair we have witnessed today.

One or two hon. Members, thinking of the future, made constructive speeches. Anybody who has had any experience of trying to encourage industrialists to move into a country, an area, or a town within an area knows that they can be very much influenced by what they gather from reading the Press and from the general atmosphere surrounding an area. If they get the feeling that the inhabitants of Scotland themselves think that we are down and out, who will come to us? For goodness' sake, let us keep the thing in proportion and not talk gloom all the time.

Why do we not talk more about the tremendous developments at Grange mouth, and of the Finnart extension, just opened, making this the first harbour in Britain to take 100,000-ton tankers? Why do we not talk more about the contracts placed by British Railways with the North British Company for locomotives? Then there are Hunterston and Dounreay. Chapelcross is now supplying electricity into the grid—[HON. MEMBERS: "All nationalised."] I do not care a hoot whether they are nationalised or not if they are contributing to the well-being of Scotland; and I agree with my hon. Friend the Member for Fife, East (Sir J. Henderson-Stewart) that this nationalisation argument should be put out of the way for the time being. It is not useful on an occasion like this. I did not intro duce it. I was listing the good things that were happening—

Mr. Woodburn

When the Conservative Party is arguing all over the place against nationalisation, and undermining it, it forces us to introduce these things into the discussion.

Mr. Maclay

I said that I did not care a hoot whether some of the projects I mentioned were nationalised, but I personally feel that it would be disastrous to have any further measures of nationalisation. I say that for this very good reason. The real problem to-day is not so much who owns things, but how to get the best management, and if anyone tells me that we have solved the management problem in the nationalised industries I just do not believe it. It still remains an acute problem.

An hon. Member opposite murmurs, "What about private industry?" In private industry we get a very flexible management. How else could we have come through the last two extremely difficult years with our unemployment figures, bad as they were, a great deal better than they were in any country in the free Western world, except France? That is true. During those years, nobody has been able to touch us on that score.

I could go through a whole range of good things that are happening, but I will mention only one more, because it is typical of what can happen in the future. Probably not every hon. Member opposite read a very interesting article in the Scotsman of 30th June, otherwise they would not all be so gloomy. In Peterhead, the Cleveland Twist Drill Company makes a fine quality product and is exporting it to all parts of the world, regardless of all problems of distance caused by being located in Peterhead. We have there the Peterhead Gear Manufacturing Company doing exactly the same thing—overcoming all these difficulties we hear so much about, by private enterprise at its very best, helped by the Government in the appropriate way, with a proper balance being followed. We have got Crosse and Blackwell carrying out food processing there, canning which used to be done in the South.

These are not developments which are going South. Here is not the risk, as hon. Members opposite have described it, of the joining up of companies, of amalgamations, meaning that these things are going South. This is not a one-way traffic. Quite a lot of things are coming North from the South. I have myself opened a factory where was concentrated the production of the whole organisation—in one Scottish factory. There is an enterprise coming from Coventry to Brechin, coming north, and doing very important work which is being concentrated there. There are other works. I have a longish list of these, but I am not going on with it now, because I have not enough time. But this is not a one-way traffic.

The reason I interrupted the hon. Member for Dunbartonshire, East (Mr. Bence) when he was speaking was that I felt that he was painting a rather too dangerously gloomy picture of the things which were going to happen—at least, I thought he was. These are things which need not happen. They are things we want to avoid.

Having said that I would say I agree with hon. Members opposite that everything we want to happen in Scotland is not happening. I was puzzled by the final attack by the hon. Member for Kilmarnock. I was not puzzled by his attack, for I knew it would come, but there was a part by which I was puzzled. I was puzzled by the fact that he sounded as though the party opposite has another policy, has a new policy. But what is it? [HON. MEMBERS: "What is it?"] Is there a new policy? Let us get straight what it is. Is it for more advance factories?

Dr. Dickson Mabon


Mr. Maclay

What is it? I have read of all these things said by the party opposite.

Mr. Hamilton

We want to hear the right hon. Gentleman's policy.

Mr. Maclay

I have read the statements of the party opposite, and, to tell the truth and to be quite frank, both parties have been working along broadly the same lines, knowing that the basic problem is the diversification of industry in Scotland.

Mr. Hamilton

Let us hear the right hon. Gentleman's policy.

Mr. Maclay

We have got this figure, which I greatly regret and deplore. The figure of unemployed is 31,000 less today than at the peak winter figure, but it is still about double that of the United Kingdom average.

Mr. T. Fraser

More than double.

Mr. Maclay

Just over double.

Why have we got it? I think the diagnosis is fairly clear. It has often been made in the House. We are still over-concentrated on the heavy industries. Undoubtedly, we have got to go on working for diversification of industry.

The hon. Member for Kilmarnock made it sound very easy, but he did not say what he would do to achieve the results he described. Does he intend to direct industry? No, of course he does not. He will not get up there and say that the policy of his party is to direct industry to Scotland. What will right hon. and hon. Members opposite do? They will put forward various forms of inducement in precisely the same way we are trying to do, because that is the practical way of doing it. Let us not, for goodness' sake, get into a political auction ring on this, each party offering a little more than the other and saying, "We are the better people." [Interruption.] It was a rhetorical question I asked. It is permissible to put rhetorical questions into speeches.

Mr. Lawson rose

Mr. Maclay

Time is short.

Mr. Speaker


Mr. Maclay

I give way a good deal, as hon. Members know. I cannot give way now. Time is short.

Mr. Lawson

On a point of order. The right hon. Gentleman definitely asked a question, Mr. Speaker, and if an hon. Member is prepared to give the answer to the question is it not in order that he should be permitted to do so?

Mr. Speaker

Certainly not, unless the Minister gives way. The question was a rhetorical question.

Mr. Lawson rose

Mr. Speaker

Order. I would ask the hon. Member to remember that there is only limited time at the disposal of the Secretary of State. A lot has been said, and I think that we ought to allow him to reply.

Mr. Lawson

Further to the point of order, Mr. Speaker. I have been present all the afternoon. I have been here much longer today than the Secretary of State. [HON. MEMBERS: "No."] The Secretary of State threw out a challenge to hon. Members on this side of the House. There was a definite challenge, and so far—

Mr. Speaker

Order. The hon. Member is not entitled to take up that challenge unless the Minister gives way.

Mr. Maclay

I will get on. It was quite clear that what I was asking was a rhetorical question as to what the hon. Member's speech meant. I will leave the House to judge for itself whether my question was justified.

I want to deal with many other things. One is the suggestion made by my hon. Friend the Member for Fife, East (Sir J. Henderson-Stewart) in the last debate, and again today, about the possibility of an overall inquiry. I have, of course, had other communications on this subject from various individual Members, and I have had talks with a number of people. I am, of course, considering, and will go on considering, all these suggestions with the greatest care, but I am quite certain that no hon. Member who knows the work of the Scottish Council would wish to do other than express the highest regard for the devotion and effectiveness with which it carries out its work. I am certain that that is the view of my hon. Friend the Member for Fife, East.

Hon. Members will recall that the Scottish Council's objects include maintaining a continuous survey of industrial developments and trends and arranging for such inquiries and research into particular problems affecting the well-being of the people of Scotland as may be desirable from time to time. From the information so obtained, the Scottish Council's remit is to advise the Secretary of State in regard to the industrial, commercial and economic problems of Scotland on which action may be needed. The Council has carried out a large number of inquiries, many, I agree, in particular areas and into particular industries, but also into the general economic position and the general prospects in Scotland. I would emphasise, as it may not be fully realised, that this process is practically continuous. My own contacts with the Scottish Council, and those of my Department and other Departments concerned, are equally continuous. I feel certain that no one would want to suggest that there should be unnecessary duplication of work or function. I will, of course, discuss with the Council the various suggestions made and will continue to think very carefully about how best to apply the constructive thought given to this problem by my hon. Friend the Member for Fife, East and other hon. Members. In the light of discussions with the Scottish Council, it may well emerge that further lines of inquiry can and should be immediately developed.

I would emphasise that, in addition to the work of its own full-time expert staff, there is nothing I know of to pre-vent the Council calling in the widest range of advisers and consultants, be it individuals, firms, universities, or any other body which can help. One thing that is quite certain is that the Government are more than anxious that the best brains in Scotland, and elsewhere, too, should be continuously applied to the solution of our industrial problems. I make clear that I consider these are grave still. We must do a great deal of constructive thinking about how best to achieve the diversity of industry that we must have, and we intend to go on to the best of our ability in search of means of getting that diversity.

Mr. Ross

The right hon. Gentleman will appreciate that the Scottish Council put a plan to him, he replied, brushing it off, and the Council's reply was The Secretary of State's reply showed no appreciation of the fundamentals of the problem. What is the good of giving the Council more to do in this respect and then paying no attention to what it says?

Mr. Maclay

I thought that the hon. Member would be asking that question. I had thought that he would have asked it in his speech and I was about to deal with the matter in my speech. I know that the reply given to the Scottish Council has been described in the Press as disappointing, but it has not been published yet.

Briefly, this is the position. It is true that the Government have not been able to accept all the Council's recommendations, but, as I told the Council, we fully share its concern about the need for further diversification of industry and a reduction of unemployment in Scotland. We believe that the measures which have already been introduced can be of substantial assistance to a solution of our problems, and what has been done in the last year has been of substantial assistance. Of course, we are constantly studying how to improve those methods.

The Council suggested, for example, that there should be an increase of 2 million square feet a year in the rate of Government factory building. The difficulty, if one is being responsible about this matter, is that while that may be a very desirable target, there is simply not the demand at present for a large amount of space of that kind. Indeed, as I have said before, there is a substantial amount of space lying empty. We expect that as a result of the general upturn in world economic activity and the measures which the Government have taken to stimulate our own economy, demand will revive, and as demand for factories rises, there should be no difficulty in meeting it. Similar considerations apply to the building of advance factories, and to a "float" of advance factory space being permanently available. We have been over the argument about advance factories very often.

I am terrified that there will not be enough time to deal with the speech of the hon. Lady the Member for Lanarkshire, North (Miss Herbison), and I will here interject that I have carefully considered the representations which were made by the deputation which she brought to see me and whose courtesy I greatly appreciate, as I do the extremely lucid and able way in which it put its case. I am still considering everything that was said by them.

We have this one advance factory building in Scotland, and we must watch the situation. It may well be that there should be more advance factories, but so long as we have a pool of a substantial number of existing factories lying empty, it is extraordinarily difficult to justify going on with a big programme. I assure the hon. Lady that we are watching the position very carefully in her area and in comparable areas.

There is one other point which was raised by the Scottish Council and with which I should deal this evening. The Council made a most interesting suggestion about investment allowances at a special rate in Scotland. In my reply, I pointed out that, as everybody knew, those allowances were introduced throughout the United Kingdom in the last Budget. I realise that that does not form a direct inducement to firms to set up in Scotland, but it has to be clear that no amount of special inducement to firms to go to Scotland will be of any use unless the United Kingdom economy is expanding. Such an expansion, which these allowances should stimulate, is bound to be of some benefit to Scotland. Differential investment allowances, as any hon. Member who considers it will realise, raise fundamental problems of policy which would have to be carefully considered before one could commit oneself to that kind of proposal, which is a completely new kind of proposal affecting taxation.

I conclude my comments on the Scottish Council by saying that I believe that the Council is now considering what further representations it should make to the Government in the light of my reply. I have been in close touch with my colleagues in the Government who are particularly concerned with the matters raised in the Scottish Council's memorandum, and my right hon. Friend the President of the Board of Trade has told me that if the Council so wishes he would be willing to join with me in meeting it to discuss its further representations.

Of course, we realise that there is an acute problem in areas, such as that represented by the hon. Lady the Member for Lanarkshire, North, which are undergoing a structural change in industry. I can say only that we will go on working in every way we can to find means of attracting new industry to her area. It is eligible for all the various types of assistance, which I need not detail again today. It is a problem of finding a firm willing to go there. That raises our policy with regard to I.D.C.s. This matter has often been discussed on the Floor of the House. We are pursuing a very tough I.D.C. policy to prevent people developing firms in areas where there is already an over-concentration of industry, and we will continue to do so.

I should like to add to what has been said by other hon. Members about the swan-song of the hon. Lady the Member for Coatbridge and Airdrie (Mrs. Mann). I have known her for a number of years, and I think we have a remote family connection of some sort through a meeting between her family and mine a long time before that. As Secretary of State I have found her as persistent, annoying and encouraging an hon. Member as one could hope for in the House of Commons. Undoubtedly, a Secretary of State would be astounded if any hon. Member who was doing the job that the hon. Lady does for her constituency was not a very considerable irritation, because that is what a good Member ought to be. I add to the expressions of our great sorrow that this is to be the hon. Lady's swan song.

My hon. and gallant Friend the Member for Berwick and East Lothian (Sir W. Anstruther-Gray) raised two specific points. One was about Dunbar. We listened carefully to my hon. and gallant Friend's able summary of why some of the inhabitants of Dunbar were concerned about the possibility of juvenile delinquents coming to that town I assure him that I have carefully noted what he said. On the question of Eye-mouth harbour, a study has been made of whether modifications can be made of the overall plan that has been put forward so as to make it a more practical proposition.

I am sorry that I cannot go through a lot of other detailed points. To the hon. Member for West Lothian (Mr. J. Taylor) I say that I am arranging, as perhaps he knows, to receive a deputation from the county council before the end of the month, when some of the acute problems of his area will be discussed.

On the question of Russian trade raised by the hon. Member for Edinburgh, Leith (Mr. Hoy), I understand that there was nothing in the agreement about designating ports. What happened was that before the Russian Trade Mission went abroad there had been discussions about setting up a regular liner service. The regular liner service was arranged quite independently of the delegation. There are no designated ports, but that service, which was worked out on a commercial basis, is based on London with Hull as an alternative port of call. As the hon. Member knows, it is up to the Government to do everything they can to use all the trade possibilities that may come out of the Russian agreement. Arrangements have been made through the Scottish Office for the Ministry of Transport to see representatives of the Leith Harbour Board, to advise them how best to get Leith more directly involved in trade between us and Russia.

We have to work together on improving Scotland economically. I do not mean that we have to give up our political disagreements, but I know from experience during the last three years that this is work where Members of Parliament, working with their local authorities and with industries in their constituencies, can make immense progress faster than the central Government can. All of us have a part to play, the private firms, the central Government, the local authorities and Members of Parliament. Let us do everything in our power to encourage people to come, but do not let us have excessive gloom or they will not come.

Question put and agreed to.

Resolved, That this House takes note of the Report on Industry and Employment in Scotland and Scottish Roads, 1958 (Command Paper No. 706).

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