4.33 p.m.

Mr. Robert Sheldon (Ashton-under-Lyne)

I beg to move, That this House, noting with alarm that the North-West Region has suffered increased unemployment which has almost doubled in the past two years, and deeply concerned at the lack of job opportunities caused by the contraction of cotton, coalmining, and now, steel and heavy engineering, fears that the Government's belated and forced reversal of economic and regional policies will be applied with insufficient determination to remedy a desperate condition; and condemns the damaging and reactionary nature of the Government's social, housing and industrial policies as applied in the Region. The last debate we had on the North-West was initiated by Mr. Speaker, who was then on the Opposition benches. That was in December, five years ago. It occurred after the Hunt Committee was set up but before it had reported. I mention that to give an indication of how rare it is that we have these debates in the House. Because there are so many of my hon. and right hon. Friends and hon. Members who want to speak I think it will be necessary to ask, as I am sure Mr. Speaker would ask, for a considerable degree of brevity by all speakers.

Hon, Members

Hear, hear.

Mr. Sheldon

I see that I have the approval of the House so far.

The problems of the North-West have increased since the debate nearly five years ago. For those of us to whom the North-West is our home it is with a great deal of sadness and even bitterness that we see what has happened during the intervening years.

As the Hunt Report says, the North-West is the oldest industrial area in the world. In the mills and factories were produced the wealth that enabled us to play an imperial rôle. The British Empire produced the trade and the North-West produced the wealth that made it work. In the 19th century half the exports of the country came from the mills and factories of our part of the country, and whole countries and even continents were clothed by the products of our factories. Africa, India, China, South America, Australia—all were clothed from the vast production that came from the cotton industry, created by the native genius of those working in the mills throughout the North-West.

It was at that time that our industrial landscape took shape, and it is the fault of those who created it, but even more it is the fault of those who came after, that it remains as it does today, the monument to the energy of the industrial pioneers and those who subsequently did not see fit to make the improvements necessary in the light of improving standards in living conditions. We note today that the Secretary of State for the Environment is undertaking a study of the North-West which I understand will cost £250,000. I also understand that this will be ready some time next year. I would be pleased if we could be told how this study is going on.

One thing we know is that the North-West Region has had studies in plenty. Basically, the problems are known, and, while we are always anxious to find out more of the details of these problems and how they can be dealt with, at the end of the day it is not studies but action that will be needed. The basic problem of the North-West is the problem of declining industry. The trouble is that in many of the areas where we thought we had achieved some diversification of industry we find that firms are closing.

We know the problems of the cotton industry, with the Board of Trade in our opinion too anxious to consider its world rôle and not anxious enough to consider the peculiar problems of an industry too open to receive the imports of countries which are balanced by the exports of those other parts of the United Kingdom. In dealing with these problems we have many of my hon. Friends—the hon. Members for West Houghton (Mr. J. T. Price), for Oldham, East (Mr. James Lamond), Oldham, West (Mr. Meacher) and Heywood and Royton (Mr. Joel Barnett)—who are deeply interested in this. In particular I wish to mention the late Jack McCann who used to raise and deal with these problems. The House will miss him very much in these debates. He was a man much liked, much loved, who will be very greatly missed over the following years.

We know too, of the problems of the coal industry, the pit closures, which are changing the economy of a number of our towns in the North-West, and if my hon. Friends the Members for Ince (Mr. McGuire) and Wigan (Mr. Fitch) and other of my hon. Friends are fortunate enough to be called I am sure that they will wish to expand on this. Added to this problem we have the closure of the steel mills of Irlam and Openshaw, which my right hon. Friend the Member for Newton (Mr. Frederick Lee) and my hon. Friend the Member for Manchester, Openshaw (Mr. Charles R. Morris) and others will wish to refer.

Not only do we see these newer industries closing and suffering unemployment problems but we also see those industries involving a high level of skill declining. In particular we note with deep regret the contraction of our heavy engineering industry which provided most of the prosperity in the post-war years. The effect of the decline on industries has given rise to very grave fears about the kind of industries which are still in difficulties, which we hoped would be the expanding industries of the future.

Let me give an illustration of the kind of problems facing us. In 1969, the last full year in which the Labour Government was in office, the unemployment figure was 73,000. In June, 1972, the last month for which we have figures, we had a figure of 136,000, nearly double. I do not want to make only party points but it is absolutely clear that the problems with which the Labour Government coped, not with the degree of success that we would have wished to see—at least we succeeded in keeping the position reasonably stable—have returned and the position has been seriously weakened over the past two years.

Mrs. Elaine Kellett-Bowman (Lancaster)

rose—

Mr. Sheldon

I hope that I shall not have to give way very much because I have asked that everyone should keep their speeches as brief as possible to provide time for as many hon. Members as possible to take part.

Mrs. Kellett-Bowman

Is the hon. Gentleman aware that in my constituency unemployment more than doubled, from 340 to 855, during the time of the Labour Government?

Mr. Sheldon

It would be interesting to know the figures since the Government came to office. But the important point is that, although there has been a welcome fall in unemployment in the North-West during the past six months, we have had only one-third of the fall in unemployment which has happened in the rest of the country. If there were some unspecified and unguessed-at time lag responsible for this, perhaps there would not be the same reason for concern. But nobody is able to show that there is any such time lag in operation. The level of national vacancies has increased by 51½ per cent. in the past six months, whereas in the North-West it has been less than half that amount. Therefore, even if the national economic situation improves slightly, we are getting nothing like that level of improvement in the North-West.

The North-West had a big problem during the whole of the 1950s and 1960s; namely, the problem of the cotton and coal industries. But it is much worse now. What frightens us in the North-West is that a new scale of problems seems to be arising. In the past there has been diversity as different parts of the region had different degrees of success or failure. In the past the problems of Preston were not the same as those of Manchester; the problems of Liverpool were not the same as those of North-East Lancashire. Today unemployment is the problem of all parts of Lancashire and Cheshire.

When the North-West Group of Labour Members of Parliament voted last year in favour of intermediate area status for the North-West, the problem of unemployment and of over-capacity was affecting all parts. We welcome, as the whole of the North-West does, the giving of intermediate area status, but it must be remembered that it was the increasing scale of the problem which made that status necessary—in fact, essential.

The North-West has suffered too long from the consequences of mergers. I am not against mergers. They can be very valuable and can bring increased efficiency. There can be an increasing concentration of production whereby costs can be reduced. But what we object to is that concentrations of industry have resulted in the closing of plants and the North-West has been much more affected than other areas where firms have merged with firms in the North-West. This might be partly because of the outdated industrial premises in the North-West. However, it must be partly due to the fact that the factories which remained open tended to be nearer to the head office, and the head office was not often situated in the North-West.

Coupled with this change is the decline in job opportunities, which is continuing. When I was an engineering apprentice some years ago, I heard stories about apprentices who were fired as soon as they reached the age of 21 because of the surplus of labour and the fact that the older man with greater experience was the better worker to employ. I always thought, and I still think, that this is the cruellest unemployment of all—the discarding of a young man just when he has learned his craft and is ready to put it to proper use. The scars of this kind of unemployment are sharper and more long-lasting possibly than any other. I know of two large national organisations where young boys have been fired at the age of 21 or have been informed that they will not be kept in employment when their apprenticeship ends.

But it is not simply job opportunities in industry which are required; we need job opportunities in office employment. This is one of the most rapidly expanding areas of opportunity, and we have to take it very seriously. Here I should like to quote from the North-West Industrial Development Association's memorandum. I pay tribute to the work of the association, doing, as it does, the work of keeping before people engaged in industry and in the region the problems and perhaps providing some of the solutions for the economic difficulties in the North-West. The association states: A serious weakness in the new package of regional measures is, in the Association's view, the complete absence of any strong initiative by the Government to promote office development in the North-West and other assisted areas. We are awaiting the report on the potential for decentralising Civil Service work, and we look forward to early action in this respect. But this is a serious weakness. There has been a massive increase in clerical work and in pay in the London area. For example, female clerical workers in the London area earn 18 per cent, more than those doing similar work in the North-West. There is much scope for an increase in office employment in our region.

However, one of the major problems confronting us is industrial dereliction. Those who may not be familiar with our part of the country will be familiar with the kind of landscape which is rapidly disappearing but which is still present in many areas. The North-West Industrial Development Association has called for an increase in the industrial dereliction grant to local authorities to 100 per cent. I am happy to support that. I fail to see why responsibility for the industrial slag-heaps and decayed buildings in the areas should be charged to the region concerned. They were the faults of the past. I must ask: who benefited from these outrages? It was not the people of Lancashire and Cheshire. It was the country which benefited, and the country must restore the area.

I welcome Operation Eyesore. I pay tribute to the introduction of the scheme. It needs to be pursued with vigour and more resources. When one goes around the North-West and talks to the people, one is struck by the fact that they feel that they are worse off than those in other parts of the country. This shows itself in pay. Earnings and wage rates in the North-West are lower than they are in more favoured parts of the country. This is known by the people concerned. The assertion, frequently made by the Government, that high unemployment is due to high wages is offensive to North-West workers when they compare their pay with the pay which is obtainable elsewhere. When the Foreign Secretary talks about greedy workers he causes a great deal of anger.

The trouble is that we have double standards. There is a standard for the businessman, for whom high profits and high earnings are good. This is held by the community to be efficient. It is said that they are the basis of our system and that this is the proper use of resources. When he makes high profits and consequential high earnings, he is, apparently, efficient and good. When the workers try to obtain high earnings, this is bad; this is greed.

It is these double standards which people find so objectionable. We must not have two standards—one for the employer and one for the employee. We are one people, and the same standards must apply to both. We are one country, and the same rewards should be given to each of the regions. The people in the North-West are not inferior in any way; they are not inadequate. It is not like Italy where there are under-educated people and non-industrial populations and people have difficulty of assimilation in an industrial environment.

Our region is still the industrial heart of the country and the people have industrial skills which they are ready and willing to use. The North-West has work patterns which are highly relevant to modern needs, with tradition based on our women going out to work, with shifts readily manned, and with all the advantages of an industrial working population used to and willing to do the kind of work which industry requires to be done.

Despite all this, and despite the considerable industrial diversification which we have achieved, we are still faced with the industrial problems which I have described. The terrible, unanswerable reality is that the regions are in decline. It is not a question of some regions going up and some going down. Apart from London and the South-West, they are all in decline. It is because the pull of London and the South-East is too strong. Part of the reason is that the heads of our industrial companies too often situate themselves in London and the South-East. Too many industrial decisions affecting our future are being taken elsewhere. Management is too remote. That does not happen in other countries but it is one of the things peculiar to Britain.

Out of the top 100 industrial companies in Britain, 84 have their headquarters in London. In America, 29 out of the top 100 have their headquarters in New York, the fiancial capital. Europe, with the exception of France, is similarly diversified, with head offices dispersed. Whereas General Motors is in Detroit, British Leyland is in Berkeley Square; whereas Daimler-Benz is in Stuttgart, Ford and Chrysler are in London; whereas du Pont is in Maryland, ICI is in London; whereas Burlington Industries, the biggest textile group in America, has its headquarters in North Carolina, not only Courtaulds but Carrington and Vyella have their headquarters in London. It is impossible to understand why other countries operate on the basis that their headquarters are where their manufacturing capacity is but this country does not. Other countries have had more success than we have had, and there may be something to learn from them.

To sum up—

Mr. Frank Allaun (Salford, East)

Before my hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon) sums up, I hope that he will say something about the announced removal of the ceiling on cotton imports this January, which is a direct consequence of entering the Common Market and will crucify Lancashire cotton towns. How some people can still defend it I do not know. The quota must be restored on 1st January, otherwise we shall be in a terrible mess. I hope that my hon. Friend will strongly pursue the Minister on this point.

Mr. Sheldon

That was to be my next sentence. I am grateful to my hon. Friend the Member for Salford, East (Mr. Frank Allaun) for reinforcing the point.

I shall now sum up. First, the problems which we have discovered over the past few years have largely been increased by the Government. The "lame duck" philosophy, which may have had its disadvantages elsewhere, has been more disadvantageous to our region. Firms have closed down which will never reopen. Some of the solutions that the Government are proposing and have proposed are valuable. I am not willing to hide my welcome for many of their solutions, but they have to be considered in relation to the problems which the Government themselves have created and increased.

What is required by way of a solution? First, one of the important ways in which we have to deal with these problems is to reduce the pull of London, whether by disincentives or some other means. Next textile quotas must be introduced where they are not in force and must be reduced where they are too high. Here I must declare a personal interest.

The well-being of the textile industry is necessary for the North-West as it is for the whole of the country. That industry is happy and willing to compete on equal terms with the European Community, but it does not want to have handicaps which industries in other countries do not bear. Hon. Members representing North-West constituencies have asked for a meeting with the Secretary of State for Trade and Industry, consisting of trade unionists and Members of Parliament, to discuss that problem. We hope that the Secretary of State will agree, because it is a crucial issue. The industry has suffered repeatedly because the Department has pursued policies which may be advantageous to other industries but are deeply disadvantageous not only to the textile industry but to the whole of the North-West Region.

Next, we want to see dereliction grants increased to 100 per cent. so that the community as a whole will pay for chat which was created in its name, to the advantage of those who have suffered for so long. We now—my hon. Friend the Member for Ince certainly knows—that there are local authority areas where almost half the land is derelict. It is impossible for such local authorities to find the resources to improve the amenities of their areas.

We also want to see selective assistance given under the Industry Bill, related closely to unemployment. Blanket inducements may be valuable but they have limitations. We want to see money specifically given to creating viable jobs in the areas of greatest need. Finally, there needs to be a strong initiative to promote office development in the North-West.

At the end of this debate, it would be wrong if anyone had the impression that I or any of my hon. Friends have come to this House to beg for money. Today in industrial Britain there is a distortion based on no industrial logic. There are men with skills and the willingness to use them in one part of the country and there are decisions frequently taken at the other end. This debate is about reducing that distortion by means of Government action, and we and the people of the North-West ask that that be done.

4.58 p.m.

The Minister for Industrial Development (Mr. Christopher Chataway)

I beg to move, to leave out from "House" to the end of the Question and to add instead thereof, welcomes the recent decision of Her Majesty's Government to schedule the whole of the North-West Region as an Intermediate Area; recognises the extensive action already taken to produce greater economic growth and improvement in environmental conditions; and endorses the regional policies of Her Majesty's Government designed to spread national prosperity more evenly. The hon. Member for Ashton-under-Lyne (Mr. Sheldon) commendably said a great deal in a short time. I shall do my best to follow him, at least in not using up too much time because I recognise that many right hon. and hon. Members want to speak. I hope that nobody on that account will criticise me if I do not mention certain topics. Inevitably, I shall have to leave out a number of matters of importance.

I do not find myself in a large measure of disagreement with the hon. Gentleman's prescriptions. The policy which he was urging to deal with regional development is close to Government thinking and practice. However, at times I quarrel with his diagnosis, which was alarmist.

The Motion can be fairly said to portray a picture of the North-West as hopelessly and helplessly slithering into decline. That is not the position. It is an area of great resources and potential. I shall describe some of the opportunities which exist for the area and show that there are not merely clear signs that the downward trend has been checked but positive signs of recovery.

We are concerned with the industrial and human problems of one region. We all know that the difficulties of the North-West have largely been caused over recent years by a low level of national economic activity. The hon. Gentleman said that he was not anxious to score only party points, and I hope that all hon. Members recognise that the national problems of recent years have been international in origin. It is fair to acknowledge that the situation which we took over a couple of years ago was deteriorating more seriously than was recognised.

The Government have, of course, undertaken more extensive measures than ever before to increase demand. Critics may now argue, with the advantages of hindsight, that, despite the unprecedented scale of that stimulation, it should have been produced even earlier. Having said that, I wonder whether anybody on either side of the House would seriously contest that the squeezes and the stagnation of Labour's years in office have had no effect in the past two years. There is certainly a striking contrast between the inheritance of this Government and that of the Labour Government in the health of the regions. Six months after taking office the Labour Chancellor of the Exchequer was able to say that things in the North-West were absolutely booming and that investment was going ahead very fast. We could not at any point have said that about the situation that we found in the regions.

The index of production for May, the provisional June figure for retail sales and the reports that are coming in from many industries in nearly every region show that the economy is now reviving firmly, but very few people would take the view that the fact that we have had a long, hard struggle to produce that revival has nothing to do with the policies that immediately preceded our taking office. I do not want to dwell on this topic, but it is perhaps of importance to refer briefly to some of the alternative solutions that are now being posed by hon. Gentlemen opposite.

The hon. Member for Ashton-under-Lyne made a very moderate speech, but there has just been published the "Labour Programme for Britain". Hon. Gentlemen opposite, I know, are as anxious as we are to assist in the regeneration of the regions and of the North-West by stimulating investment and encouraging a growing confidence, but what sort of encouragement to investors does that programme contain? It is clear on almost every page that Labour means to return to a policy of rapidly rising taxation and squeezed profit margins. Labour promises again to set up an agency— to integrate industries and firms into the public sector". Labour threatens overseas companies which are considering investing in this country with a range of measures specially directed against multi-national companies. I do not need to say that in the North-West, as in other regions, investment by foreign companies is extremely important. The suggestion in the Labour programme that the Government would require to take equity in the parent company of multi-national companies, as well as to appoint a director to the parent board, would, if it were taken seriously, hardly induce Ford, General Motors and others who play an important part in creating employment in the North-West to expand their activities. Fortunately, however, I believe that most of this will not be taken seriously, and I hope that the hon. Member for Ashton-under-Lyne and others who have a firm grasp of realities will be able to do something about this programme before too long.

I turn now to the problems that particularly face the North-West. The region has experienced major structural changes over this past decade and more. Since 1959 employment in cotton textiles has halved. There have been big job losses in coal mining and in steel. Employment has been reduced, too, in shipbuilding and repairing, clothing and particular sectors of engineering, notably electric plant and machine tools. In some of these areas there is the prospect of further contraction.

There is, I know, much concern about the rationalisation of the steel industry and the British Steel Corporation's recent announcement about Irlam. I think, too, it is generally recognised on both sides of the House that if our steel industry is to be competitive this process of rationalisation cannot be halted. During phase 1 of the closure of Irlam, although 1,900 jobs were lost to the beginning of 1972, the great majority of the people who were displaced were absorbed into other industries. Against a background now of rising economic activity and falling unemployment, there are prospects of absorbing even more effectively those who are to be released from Irlam over the next two years.

Nobody can be in any doubt about the human problems that are posed by these changes. The figures I have given for the changes that the North-West has had to face over the last 10 years and more give some indication of the scale of the problem in the region. I hope that nobody is in any doubt of the importance of ensuring that new jobs are created in the region to compensate for those lost by the BSC's reorganisation and by several other such factors.

Much has been said—and the hon. Member for Salford, East (Mr. Frank Allaun) referred to it in his intervention—about anxieties in the textile industry over arrangements within the Common Market. We have taken on board the industry's views about imports of low-cost cotton yarn, and the hon. Member for Ashton-under-Lyne referred to discussions that I hope can be arranged in due course. There are negotiations due in the autumn about quotas on cotton textiles. The problems relating to imports of man-made fibres and polyester cotton in particular are at present under active consideration by the Government.

We should not forget that the textile industry as a whole has made it clear that it welcomes entry into the Common Market and is confident of its ability to compete with the textile industries of Europe. Looking back over the experience of the decade, one recognises that there has been an encouraging growth in activity in many other industries.

Mr. Frank Allaun

Will the right hon. Gentleman answer the question? Do the Government intend to go ahead on 1st January with the proposal to remove the ceiling on textile imports? He must be aware that the textile unions are desperately concerned about this. The cotton industry has lost 300,000 jobs in 20 years, and this proposal would wipe out the remainder of the cotton industry. Whether or not we join the Common Market—of course, I hope that we do not—I hope that the Government at least will not comply with this condition of the Common Market because it will be critical not only to the cotton industry but to the light engineering industry which supplies the cotton industry.

Mr. Chataway

Generally speaking, we shall retain our existing rights to control imports of cotton textiles from developing countries. There are already Community arrangements with certain countries for restraining their exports. There are anxieties about cotton yarn, but the larger question is the principle of a comprehensive policy for restriction of textile imports into the whole enlarged EEC. There is clearly a balance to be struck between fair dealings with the developing countries and the protection of our own industry, for very good reasons. On entry into the Common Market some areas of the textile industry will benefit and some will not, but the textile industry as a whole has made it clear that it welcomes entry and sees considerable opportunities.

Mr. Charles R. Morris (Manchester, Openshaw)

Is the Minister saying that the Government are prepared to sacrifice the yarn and spinning sections of the textile industry? That is the implication of the statement he has just made.

Mr. Chataway

No, I have not said anything to the House that is not known and has not been said on several previous occasions. I was correcting the impression given by the hon. Member for Salford, East, I am sure inadvertently, that all quotas came off cotton textiles. That is not so.

Mr. Morris

What about yarn?

Mr. Chataway

Cotton yarn is on the EEC common liberalisation list and this has been know for many months.

Mr. Morris

rose—

Mr. Chataway

I am telling the hon. Gentleman that nothing I have said has changed a position which has been known for a very long time. I have indicated the areas in which we are having discussions, and I hope he will forgive me if I turn to other areas. I am sure the House will not want my speech to be too long.

Looking back over the experience of the 1960s and late 1950s, we recognise that in the North-West there has been an encouraging growth in activity in many other industries. The engineering industry as a whole has grown, despite weak areas. The oil and chemical industries have invested heavily and, although there are some immediate investment problems, it is to be hoped that the substantial production gains of the past will continue. The food and drink industries are contributing useful gains. Most of the compensating industrial growth has come from established industry, but 60,000 jobs, principally in the motor industry, have been created since 1959 by newcomers to the region. Furthermore, much new employment has been contributed by the service industries.

Taking the whole of the past decade, it is clear that the region has had some real success in absorbing large structural losses and has a well diversified economy, but it has problems enough to justify its assisted area status. I have no doubt that investment is needed to cater for the manpower released by the declining industries.

The more recent figures are encouraging. It is true that the peak in unemploy- ment came later in the North-West than to the rest of the country and that recovery also appears to have been a few months behind the rest of Britain. Leaving aside the figures for 1972, which were distorted by the coal strike, the national rate of unemployment began to decline after January, 1972, whereas the North-West did not see a turn-round until April. But by June unemployment in the North-West had fallen by 15,000 as compared with the corresponding April figure. On the other side of the coin, the number of unfilled vacancies in the North-West has been rising since January, 1972, and in June of this year the figure stood at 15,400, which was 3,000 more than in January.

It is against this rising trend that the region now faces the opportunities provided by the Government's new package of regional measures. I wish to draw attention to a few of the more important features of these measures. First, the scale of incentives offered to investment in the assisted areas is greater than ever before compared to the rest of the country. There are regional development grants of 20 per cent. to be paid towards the cost of buildings in qualifying industries throughout the region and 20 per cent. of plant and machinery costs are payable in addition in the development area and in Skelmersdale, and these are very substantial. This means that if these grants are taken together with tax relief it will enable profitable companies to recover more than half their expenditure on industrial projects in the development areas and 36 per cent. of expenditure on new buildings in the intermediate area.

Secondly—and this is a particularly important feature in the North-West—there is no discrimination against existing firms. Existing firms are enabled to modernise by abolishing the job link; that is to say, by no longer requiring that new employment must be created in order for an area to obtain assistance. The opportunity is now given to older industries in the North-West, of which there are many, to modernise their buildings. I believe that this can be of very great importance to the environment and in safeguarding employment for the future.

Thirdly, there are the provisions for selective assistance which will provide a flexible means of encouraging development in strategic industries and in areas within the region. I agree with the hon. Member for Ashton-under-Lyne that there is an important function for selective assistance for the service industries. It cannot make sense to give a general grant to all service industries, because the majority are not mobile. Their existence and expansion depend on the level of economic activity in the area. There are some service industries, and headquarter officers are a good example, which are potentially mobile and which, given some help, may be induced to come into the region. It is of considerable importance that the region should attract more office development. I envisage this as a use to which the power in Clause 7 of the Industry Bill can be put.

Another important feature of the new arrangements is that there should be a greater level of devolution to the region than ever before. The Department's regional organisation in Manchester has been strengthened. The post of regional director has been upgraded, and the director will shortly be assisted by a regional industrial director from industry. The regional organisation, assisted by the Regional Industrial Development Board, will have a great measure of decision-making.

Mr. Michael McGuire (Ince)

Has the right hon. Gentleman considered the request from the North-West that it should be given a grant for propaganda purposes? Certain areas have been given grants for this purpose, and we should like to know whether the Minister will look favourably at our request.

Mr. Chataway

I am considering this proposal from the North-West Industrial Development Association. A number of considerations are involved and we must look at the division of function between Government authorised bodies in the promotion of the region. I am prepared to look at the proposal.

There is now clear evidence that industry is very much interested in the North-West and in these new measures. At the end of last week, 1,131 firm inquiries were all recorded in my Department's regional office in Manchester. Among these are many which could have important employment implications.

Another indicator is the number of applications for industrial development certificates. Since late March this year IDC approvals in the North-West have been very substantially higher than those for the corresponding period last year; the number is 30 per cent. higher. The area of factory space involved is 100 per cent. higher, and, most important, the estimates by applications of the number of new jobs is nearly 100 per cent. higher.

There are also signs of growing interest among service employers in the North-West as the gap between rents in London and the North-West widens. The Government have their part to play in providing greater office facilities and office jobs in the regions. Some 28,000 jobs have already moved from London, and another 19,000 are to follow. The computer PAYE centre at Bootle is going ahead, and a further fundamental review of possible dispersal of Government offices is nearing completion. It is hoped that conclusions will be available towards the end of the year.

My hon. Friend the Under-Secretary of State for the Environment in winding up will deal with a number of developments for which his Department is responsible. It is worth noting that the past two years have seen an unprecedented effort by the Government in terms of home improvement, clearance of derelict land and road building. In the last financial year, 29,000 cash grants for home improvements were given in the North-West compared with 8,600 in 1969–70. The road building programme built up to a peak of more than £65 million a year last year and is currently running at about £45 million. In the clearance of derelict land there has been an effort on a remarkable scale. The total approved programme is now 2,600 acres costing some £6¼ million. It should be remembered that in the development areas 85 per cent. of the cost of that programme is met by the Government, and in the intermediate areas 75 per cent. When the hon. Member for Ashton-under-Lyne suggests that the 85 per cent. should be 100 per cent. he has to consider whether it is not desirable to have some local authority involvement. With rate support grant, which is given on the 15 per cent. which remains to be paid in the development area, it is a fairly modest proportion of the total cost which is now being met by the local authorities.

Mr. Sheldon

But even when a local authority has its land restored it still has to spend a considerable amount of money afterwards.

Mr. Chataway

Yes, but the point is that the difference between 85 per cent. and 100 per cent., in view of the fact that rate support grant is available, is pretty modest.

Mr. Laurance Reed (Bolton, East)

My right hon. Friend seems to be attempting to justify the discrepancy between 85 per cent. in development areas and 75 per cent. alsewhere. However, Liverpool has a very small amount of waste acres whereas an area east of Wigan has no less than 33 per cent. of its land classified as derelict area. Surely the grant should be equal throughout the area. Should not the element of discrimination between one part of Lancashire and another be ended?

Mr. Chataway

I do not want to engage in an argument with my hon. Friend about the relative needs of two places. But the general principle is right that there should be a differentiation between development areas and intermediate areas since the capacity of development areas to meet the costs involved is on the whole less than that of intermediate areas. However, my hon. Friend the Under-Secretary of State for the Environment may wish to reply further to that question.

All these measures, together with the expansion of training opportunities in the region, mean that the region now has a very great deal to offer industry. Shortly it will be served by one of the finest motorway and traffic systems in the country with fast roads to all parts and fast urban roads to ensure rapid access. Ring way, with growing freight and international passenger traffic, is the country's second highest airport. Merseyside's new dock at Seaforth and the introduction of modern handling methods at Manchester promise an important advance in the ports. The region's labour force has almost every kind of skill and industrial experience. There is no justification therefore, for selling the North-West short.

I do not believe that the Opposition's Motion gives encouragement to the recovery which is now getting under way. I hope that in due course it will be rejected. I hope, too, that there will be a general recognition in the debate of the progress being achieved in the North-West and of the substantial opportunities which are now available.

5.30 p.m.

Mr. Frederick Lee (Newton)

May I first take up the point made by the right hon. Gentleman about dereliction? Perhaps I might remind him that the Lancashire coalfield, with the exception of St. Helens, is outside the Lancashire development area. That is almost unique. Where-ever development areas are based on the contraction of the coal industry, invariably they are special development areas, let alone ordinary development areas. Until three years ago we in Lancashire did not even have St. Helens in the development area. For that reason we have never had the increased aid which the hon. Member for Bolton, East (Mr. Laurance Reed) commented upon, and, therefore, our dereliction problem is more severe because of our lack of development area status.

The right hon. Gentleman also referred to the aid which intermediate status should bring. Again I remind him that the development area policy pre-supposes heavy unemployment in some areas and full employment in others. This is the assumption of mobile industry. When there are high rates of unemployment throughout practically the whole country there is not the same mobility of industry as existed previously. While I hope that the right hon. Gentleman is proved right in what he said, I suggest to him that unless there is a general improvement in employment levels throughout the country there will not be the kind of mobility that we both hope to see coming into the North-West Region.

My hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon) reminded the House that Lancashire was probably the oldest industrial area in the world. At a time when great industrial changes have to be made, areas such as Lancashire suffer the worst. In my constituency, Stephenson had his wagon headquarters. In my time I have seen that go. I have also seen the coal mines go to a great degree, and now steel is in considerable trouble. I make no party point when I say that we have reached a phase where we see great institutions and firms leaving small areas which are utterly dependent upon them for their economic life. We cannot be satisfied that they should wave us a fond farewell and leave us to pick up the pieces. We have reached the stage where those in boardrooms, whether in nationalised or private industries, should take account of the social consequences of their decisions.

During this phase it senems to me that both industrialists and Governments have proved themselves far more adept at eliminating jobs than at creating them. This is one of the enormous problems that we face. As the process of modernising our older industries continues the balance between the elimination and the creation of jobs will tilt adversely for reasons which I shall try to give in a moment.

Although we have seen heavy investment in the public sector we have been disappointed at the low level of investment in the private sector. When, as we hope, that picks up we shall see the swing of labour intensive industries to capital intensive industries. That is the object of the exercise. It may be that in the older industrial areas the process will show results out of all proportion to what they would show in industries which are more modern in their base than we are.

The Minister referred to improvement in the unemployment position. We welcome it. I agree there has been some small improvement from the disgraceful levels of a few months ago. But we must remember that we are now at the very height of seasonal employment. We are in the second half of July. I know from personal experience during my days at the old Ministry of Labour that the decline will begin two months from now. When we look at an unemployment level of 800,000 in July we must keep in mind the decline in seasonal employment which is the usual pattern from September onwards. We must not be too complacent because we seem to be a little better off at the moment than we were a short time ago.

For these reasons, the Government should do more in the sense of defining who accepts social responsibility for these great removals from which Irlam is suffering.

Recently the Secretary of State said that it was the responsibility of industry to look after these matters. Is it or is it not? I believe there is responsibility on both the Government and industry in this respect. The nationalised industries argue "If you want us to be viable, do not put social costs on us." However, when they go to the Government, they are told that it is the responsibility of the industry. This cannot go on. We must have a clear definition about who accepts social responsibility for the great changes which are now taking place.

I will not go over the whole history of Irlam's development. However the whole economy and atmosphere of the area revolved on the steel industry and the fact that 5,000 of its inhabitants were based there. Therefore, its economy relied utterly upon it. The British Steel Corporation chooses to go at a time when the Lancashire Tar Distillers in the same area has said that there will be 130 redundancies during the year.

I have proved beyond doubt the profitability of Irlam. Its markets are within a 50-mile radius. Steel scrap is available for the electric arc furnaces, and so on. Following the decision of the BSC I asked for an independent inquiry about the viability of the Irlam Works. I would stand by the result of such an inquiry whether it should be closed or remain open. Having met the BSC, I am convinced that some of the gentlemen concerned are more worried about their £200 million investment at Scunthorpe, which may not be looking so rosy as it once did when it was a gleam in an engineer's eye, and are determined to eliminate steel producing capacity in other parts of the country. Therefore, I again ask the Minister to accept the need for an independent inquiry about the viability of Irlam.

The obvious alternative to employment in the Irlam Steel Works is in Trafford Park, once the biggest industrial estate in the world. There were 30,000 people employed in Metropolitan Vickers alone before Mr. Weinstock decided we had too many there. There was a great alternative for Irlam people there, but now that is in decline. Therefore, the alternative about which the Minister was confident quite frankly does not now exist.

Yesterday I had a near miss with a Question I wanted to ask the Department. It referred to the use of Section 15 of the Iron and Steel Act, 1967. Section 15 gives the Minister power to stop development in the private sector which would be inimical of the development programme of the BSC. The Minister intimated that he would not use Section 15. He argued that it is the Government's policy to encourage investment and so increase efficiency in both sectors of the steel industry.

I call in aid an article from the Observer of 11th June, 1972, which describes therise of what is described as "mini" steel works. The article states: Two Midland companies, F. H. Lloyd and Cooper Industries, announced plans last week to build a £3 million, 100,000 ton a year, mini steel works in the West Midlands. It then refers to Richard Johnson and Nephew in the area of my hon. Friend the Member for Manchester, Openshaw (Mr. Charles R. Morris).

It continues: Tucked away in a corner of Kent, Sheerness Steel Company's £10 million, 57 acre works is now in operation, only 15 months after construction began. It's the first steel works to be built in the South-east of England, well away from the traditional steel producing areas. But then the whole idea of the mini steel works marks a sharp break from conventional steel industry thinking. So, whilst thousands of steel workers throughout the development areas face unemployment, we see the rise in the South-East of the mini steel works whose capacity I shall refer to again in my quotation from the Observer article. It does not seem to make sense, especially as we have a report which predicts that the BSC will be confined to 28 million tons annually, that thousands of steel workers should be thrown on the unemployment heap. We see mini steel works being added to the private sector. The Secretary of State, who has power to stop this development, refuses point blank to use Section 15 of the 1967 Act.

The article goes on to deal with technical points with which I will not weary the House. However, it makes this point, which is worth consideration: Sheerness's 200,000 tons a year of steel bars may seem a flea-bite compared with the BSC's annual output of 25 million tons. But Sheerness's 200,000 tons a year output of reinforcing bars compares with BSC's output in this sector of about 700,000 tons a year. So they are coming precious near to the same kind of production of bars as the BSC.

Next Gerry Heffernan, a Canadian steel maker and one of the pioneers of the 'mini'. heard of the project, flew over to Britain and joined forces with Learmond, now deputy chairman and sales director of Sheerness. The Canadian Government, faced with a domestic depression, offered a 10-year, $13 million loan on condition that the bulk of the plant's equipment was made in Canada. To complete the financial package, £2,650,000 of Sheerness loan stock and Ordinary shares was placed with institutional investors. Overall North American interests have a 64 per cent. stake while British investors hold the rest. I am not complaining about foreign investment. I am pointing out that we are now seeing, as is predicted, the mini steel mill very much on the upsurge. Literally dozens of people are hoping to open steel mills in the private sector of the British steel industry. This is sheer lunacy. How can the BSC hope to look at its programme objectively when duplication on that scale is taking place? Section 15 was put into the 1967 Act to prevent that very thing. This is a question not for the BSC but for the Government. It may be that the BSC's policies are wrong—I think they are wrong in this respect—but on this issue it is a straight question for the Government. The Secretary of State has complete responsibility for deciding whether to use Section 15. It is sheer nonsense, sheer hypocrisy, for any Minister who says he is greatly concerned about what is happening throughout the places where steel has been made for so many years and where men have given their lives to the steel industry to allow duplication in places where there is no steel-making history while men are being thrown on the unemployment scrap heap in the way I have described.

I believe that the House is entitled to an answer on this. Before the debate ends we should ask why the Minister will not use Section 15. I assure him that there is great concern about this matter not only in Irlam but on this side of the House and throughout the country. I hope that by the time he comes to winding up the debate the hon. Gentleman will have received some information from the Department of Trade and Industry on what we consider to be one of the most vital matters imaginable.

5.40 p.m.

Sir Robert Cary (Manchester, Withington)

I shall observe the mood of the debate and be brief.

It is a pleasure to follow the speech of the right hon. Member for Newton (Mr. Frederick Lee), because the cause between us is a common one centred upon Irlam Steel Works. But before I come to that may I join in the tribute paid by the hon. Member for Ashton-under-Lyne (Mr. Sheldon) to the late Jack McCann, who was a personal friend of mine. For 10 years it was my privilege to represent the Eccles division of Lancashire, and I knew Jack as a young man and saw him become mayor of that borough in 1955. He made a good contribution to local government, he made a splendid contribution to the House of Commons, and his going is to be regretted by us all.

I agree with so much of what was said by the hon. Member for Ashton-under-Lyne and by the right hon. Member for Newton that it is difficult to find those points of fundamental disagreement which divide the House of Commons on the whole future of the North-Western area. The right hon. Gentleman matched industrial efficiency with social consequences, and this seems to be vital in all industrial policy in an industrialised country like ours.

The old objectives of profitability in industry, to get on or get out, to make and thrive or to fall, can no longer be the yardsticks by which one approaches an industrial society. The Government are striving within their own competence to match industrial efficiency and take into account the social consequences which may ensue in old and ancient areas like the North-West whose capital assets, in many respects, are out of date and have to be replaced.

I agree with the hon. Member for Ashton-under-Lyne that one of the obvious symptoms, or failures, is our monitoring of personnel and great concentration of administrative and industrial labour which, in the nationalised sector, is under the immediate control of the Government, and not diversifying more in other areas of the country. This constant concentration into the South-East has been a bad phase in the last 20 years and has done intrinsic harm to areas which I have been privileged to represent for more than 30 years. I have seen the changing pattern during the last 30 to 40 years, and we must now make efforts not only to rehabilitate but to rebuild the area and fortify its people with the energy, bite and skill which enabled the people there to make such a great contribution in years gone by.

I have only one preoccupation in this debate, apart from the general welfare of the Lancashire-Cheshire border which I am privileged to represent. It is the subject which dominated the speech of the right hon. Member for Newton. I cannot have a better text than that which appeared in a document circulated to all hon. Members by the North-West Industrial Development Association. One sentence in it is sufficient: Of the redundancies announced which have yet to take effect, the second phase of the British Steel Corporation's move to close the steelworks at Irlam gives most cause for concern. Over 2,300 jobs are at stake, the closure being due to take place sometime in 1973. This is another serious body blow to the Manchester area. Following the closure of Metropolitan-Vickers, which was mentioned by the right hon. Gentleman, the complete shutdown of the Irlam Steel Works is one of the worst body blows that we can suffer, but in saying that I cannot support the gloom of the Sunday Times, which referred to it as The town that waits to die". That is not the way in which the matter should be dealt with. I had the privilege of being the companion of the right hon. Member for Newton when, following a communication from Lord Melchett, the Chairman of the British Steel Corporation, we attended that final meeting in the offices at Irlam to hear the corporation's verdict about its future. Fortunately, it is not to be 1973. I think that the right hon. Gentleman will agree with me that the one plus mark was an extension by another year to 1974.

Mr. Frederick Lee

Two years.

Sir R. Cary

Two years. So we now have to years' grace in which to prepare ourselves to create a new Irlam. On the occasion to which I have referred I was to have been accompanied by my hon. Friend and Colleague the Member for Stretford (Mr. Churchill) but another urgent parliamentary engagement prevented his attending. I was, however, able to bring back to him the decisions which we heard from Mr. Morley and his colleagues, who told us what had been decided.

I was a little comforted in some ways. In the first phase we lost 1,900 to 2,000 jobs. In fairness to the Government it must be said that the pump priming which has gone on in that area the last 12 months has brought about the situation that out of the total of 1,950 men discharged only 280 are now registered as unemployed.

Mr. Frederick Lee

I am not certain that that is the right figure. That is the number at the Irlam employment exchange. The area around also suffered intensely, and it would need a breakdown of the figures at the other employment exchanges to get the correct number.

Sir R. Cary

I appreciate what the right hon. Gentleman has in mind, but I felt assured by the lowness of the figure, even though it was taken off a limited employment exchange register, when Mr. Morley, speaking on behalf of the corporation, said: Even if we gave you your wish and installed two arc electric furnaces we should provide employment for only about 500 men. Five hundred men is not the full loaf that we wanted. We hoped that with the installation of two electric arc furnaces we could give employment to 2,000 men. But, in any case, if the employment situation in the area is to improve steadily, I would accept two electric arc furnaces giving employment to 500 men with the happy thought that the surplus labour created, which would be the younger element, could within reason find alternative jobs in the area.

Therefore, I come back to the point that an inquiry would be justified into the Irlam situation. We have two years of time on our side. The problem of the hon. Member for Manchester, Openshaw (Mr. Charles R. Morris) has been solved in the steel works with which he is concerned because another firm, in Sheffield, has come in and is diverting some of its work. The Irlam problem is concentrated in the township of Irlam, and I beg my hon. Friend the Under-Secretary to consider the plea made by the right hon. Member for Newton. The only contribution that I make to this debate is that I add my plea in support of his.

I liked the opening sentiments expressed by the hon. Member for Ashton-under-Lyne. I have seen a lot of the Lancashire- Cheshire border in 40 years. I went to that area with David Maxwell Fyfe as a candidate in the early 1930s, in the deep trenches of mass unemployment. There were 3 million unemployed in the country. It was a back-breaking agony which I hope we shall escape. A year ago when it appeared that unemployment was reaching a certain level, when we got to the 1 million mark, the old fears began to assert themselves, but the swift action of the Chancellor of the Exchequer and the Government produced a scale of remedies—palliatives, if one likes—particularly in the development areas, in the form of regional grants. This is one remedy to which the Germans are objecting, or about which, at least, they are seeking information. There have been some rather intimidating headlines in the Press. But this is the hinge upon which we hope to do so much to rebuild the Lancashire-Cheshire border. I hope that what is printed in some newspapers represents no more than a scare.

I was privileged some years ago to attend a gathering in the Manchester town hall, when we gave the freedom of that great city to Lord Simon of Wythenshawe. In his speech of acceptance he said that the one thing he regretted most as a citizen of that city was that when he looked out of the windows of the town hall he did not see a garden city spread at his feet but instead broken-down offices and warehouses. The Germans have learned this lesson through their city guilds. All too frequently our cities have been used as areas of extraction. If a new wealth is to be created on the skills of our people, the areas to benefit most should be those in which the money was made and in which the people thrive. We have a civic duty to dedicate ourselves in rebuilding our country, in replacing outworn capital assets and in doing the honourable and straightforward thing, not to some external god of our own imagination but to the great working force which is the hinge on which our industrial might has always dwelt—the ordinary people in the street.

5.55 p.m.

Mr. Arthur Davidson (Accrington)

When I spoke in our last debate on the North-West I managed to speak for a quick three minutes at the end of the debate. I hope to be almost as quick this time, although I have a somewhat more prestigious position which I do not like to waste. However, I shall be brief.

I want to talk about the problems of North-East Lancashire. I want to stress the words "North-East Lancashire" so that the Minister does not fall into the trap into which so many people who are not over-familiar with the area fall, in thinking that the problems of the North-West and of Lancashire mean the problems of Greater Liverpool and Greater Manchester. They do not by any means. It is true that in North-East Lancashire we suffer from many of the same problems. The only difference is that we have them to a greater degree than the other part of the North-West and the other parts of Lancashire. We suffer from the same problems of dereliction, only more so. We suffer particularly from the same annoying problem of the drift-away of young people, only to a far greater degree.

The greatest indictment that I can make against the Government is this. Over the last two years, for month after month, the Government have succeeded in producing in an area of traditionally low unemployment, in North-East Lancashire, the highest unemployment figures since the war. In my area the largest factory has been on short time for the last few months. The Minister will know—it is mentioned in the document which has been referred to earlier—that only last month one of the largest employers of labour, J. and T. Rothwell, has closed down with a resultant loss of 300 workers, many of whom will leave the area and will seek work elsewhere.

I know what Ministers will say. They will say that it is all due to greedy workers and bad labour relations. I find it particularly offensive that people who are doing all right and have always done all right should refer to workers as greedy and grabbing. My hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon) mentioned, quite rightly, that the wage rates in the North-West are on average lower than those in most other parts of the country. That is true, but in North-East Lancashire they are even lower than in other parts of Lancashire and other parts of the North-West. As my hon. Friends will know, labour relations in North-East Lancashire have always been traditionally good. Yet in an area of excellent labour relations and of low wages, one of the largest factories has had to close down in the last few months.

It is all very well for the Minister, as he is entitled to do, to come out with optimistic statements about the statistics of unfilled vacancies and that sort of thing. Optimistic statistics cannot disguise what people feel and what they are suffering, and anyone who has lived in North-East Lancashire in recent months knows that throughout the area there is a deep sense of insecurity about jobs. People can feel and smell unemployment in the air because it is there, and it is lingering.

A particular problem arising out of the aftermath of the closure of J. and T. Rothwell concerns apprentices. I do not expect an answer from him tonight, but I must put this matter to the Minister. Forty apprentices will shortly lose their jobs as a result of the closure. The majority of them have not managed to find alternative employment—this applies especially to platers and welders—and the prospect for them is gloomy. In the upper age group, there is a particular problem because, unless these boys can complete their apprenticeship in their chosen trade, they will lose their designation as skilled craftsmen and will have to take dead-end jobs, jobs without any future, jobs fit only for unqualified people.

There is also the question of their technical training. It has been put to me by the Amalgamated Union of Engineering Workers—I put it to the Minister for his consideration—that the Engineering Industry Training Board and the Department of Employment should jointly sponsor these apprentices for at least the next 12 months so that, until such time as they can obtain other jobs, their technical training may continue without a break. This is especially important for those already half-way through their modular training. I hope that the Minister will convey that suggestion to his right hon. Friend at the Department of Employment as a constructive and sensible proposal to help these boys out of a serious difficulty.

The plea has been made, not only by the North-East Lancashire Development Committee, that North-East Lancashire should be given full development area status. I do not quarrel with the Government's decision to grant intermediate area status to other parts of Lancashire. That would be churlish, and it would be out of keeping with the feeling of people in North-East Lancashire. But I remind the House that North-East Lancashire was given intermediate area status by the Labour Government originally because it suffered from some special problems—I do not wish to go into them now—and it needed special incentives, particularly for new industries to develop.

Now that the rest of Lancashire has been upgraded—I see the Under-Secretary of State smiling, and I know what is in his mind: he thinks that I am always asking for more—the differential has gone, and the inducements and incentives for industries to open up in North-East Lancashire have now, as it were, disappeared because the same incentives are there throughout the rest of the county. This is a genuine plea made with great force by the North-East Lancashire Development Committee, and I ask the Minister to take it seriously.

Now, the question of intermediate area status for the new town. Statements were repeatedly made from the Government Front Bench that the mid-Lancashire new town was not to be given intermediate area status until the problems of North-East Lancashire had been solved. The hon. and learned Member for Darwen (Mr. Fletcher-Cooke) raised this point with great force in an Adjournment debate. Why are we now told that the new town is to be given intermediate area status? Plainly, this will be unnecessarily damaging to North-East Lancashire, and I ask that the decision be revoked.

6.4 p.m.

Mr. David Waddington (Nelson and Colne)

I suppose that in politics one should never be satisfied but—I speak with studied moderation—I think that the Opposition's Motion is, to put it mildly, somewhat ungenerous. It is interesting to compare the tone of the Motion with the reaction in Lancashire to the Government's recent policy decisions. It is of particular interest, for example, to compare the rather churlish, bad-tempered and ungenerous tone of the Motion with the letter written by the chairman of the North-West Industrial Development Association to my right hon. Friend the Prime Minister after the new Government measures were announced at the end of April.

Alderman Tweedale wrote to the Prime Minister in these terms: There can be no doubt that the proposed changes in policy go to a considerable way towards meeting the recommendations put for-fard by the Association over a number of years to successive Governments. In particular, we are very pleased that assisted area status has now rightly and fairly been granted to all parts of the North-West and that industrial development will in future be actively fostered by the Govrnment throughout the Region. He went on to say, again as spokesman for the North-West Industrial Development Association: We also welcome the measures introduced to help tackle the problem of industrial obsolescence in our old industrial towns" and he concluded: I hope you will make a further visit to the North-West in the near future, when the Association will be delighted to entertain you and to have an opportunity of thanking you face to face for the action your Government have taken to help the North-West. I waited with interest to see the terms of the Motion. One is always glad to have a debate on the problems of the North-West—for one thing, it seems to be one of the few occasions when I can manage to make a speech at a reasonable hour, perhaps because there are not quite so many hon. Members anxious to get to their feet—but I was surprised and somewhat dismayed to read the wording which the Opposition had put down.

North-East Lancashire is not specifically mentioned in the Motion—I make no criticism of the Opposition for that—but I wish to say a few words about that area, the one which I know best and an area which has been recognised as one facing particular problems over the past few years.

Certain people in North-East Lancashire have expressed concern at the fact that, as a result of the whole of Lancashire having either intermediate area or development area status, North-East Lancashire has lost the special advantage which it has had over the rest of Lancashire, apart from Merseyside, since 1969. In my view, however, we in North-East Lancashire have little reason to complain about this relatively small margin of advantage being taken from us.

One should cast one's mind back over recent history to the setting up of the Hunt Committee and the time when it reported to the then Government. First, what the Government have done is what the North-East Lancashire Development Committee was itself calling for immediately after publication of the Hunt Report in 1969. Second, the North-East Lancashire towns are themselves members of the North-West Industrial Development Association and, as I have said, that association has expressed itself as delighted at the recent policy decision announced by the Government, especially the decision to make the whole of Lancashire outside Merseyside an intermediate area.

Mr. Frederick Lee

The development council was very worried about the Hunt Report because it talked about de-scheduling Merseyside.

Mr. Waddington

Yes, but what the North-West Industrial Development Association called for at that time was what it has now got. The Hunt Committee said that, in order to provide the funds for making the whole of Lancashire an intermediate area, Merseyside should be descheduled. The North-West Industrial Development Association has now got what it probably thought that it would never get, that is, both its cake and its ha'penny.

Thirdly, one has to remember that no one, no one living in North-East Lancashire and no Member of Parliament for North-East Lancashire, can say with his hand on his heart that the towns of South Lancashire do not suffer far worse problems of dereliction than we do in the North-East. No one from North-East Lancashire can seriously say with his hand on his heart that other towns, in South-East Lancashire particularly, do not have very much worse housing conditions than we suffer in the towns of North-East Lancashire.

Of course it is not surprising that there is still great concern in North-East Lancashire about the impact that the new town is likely to have on the industrial future of North-East Lancashire, but many of the steps proposed in the impact report have already been taken. In particular, the Calder Valley road is no longer a dream and it should be completed by 1977, three years before the consultants said that the full impact of the new town would be felt in the area. Secondly, the consultants stressed the need for comprehensive renewal and rehabilitation of the urban fabric and that is going on apace in North-East Lancashire.

I cross swords with my hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke) in believing that the Government have reason to resent the suggestion that is made from time to time that they are in breach of faith because the new town area is now in the intermediate area which, as I have said, covers the whole of Lancashire, apart from the Merseyside development area. If the Hunt Committee's recommendations were to be implemented, it is impossible to see how Preston, Chorley and Leyland alone of all the towns in Lancashire could be set apart from the rest of the Lancashire intermediate area, and even more difficult to see how, if they had been artifically separated from the whole of the rest of Lancashire, that would have been of any benefit at all to towns like Burnley, Nelson and Colne.

Presumably, the only result of the exclusion of the new town area from the Lancashire intermediate area would have been intensive industrial development a few yards over the artificial boundary but still as close as possible to the M6, which would have been the obvious place to put new industry. There would have been no difficulty about putting new industry there because of the unfortunate decision taken by the last Government to include the country area between Blackburn and Preston in the intermediate area, a decision which in turn led to what I still regard as the foolish planning decision of the present Government at the beginning of their term of office allowing Whit-bread's to build its new brewery in the open countryside.

Mr. Laurance Reed

Accepting the view that it was not possible to exclude the new town from intermediate status, could not the whole concept of the new town have been abandoned? Very few people in the area wanted it and the decision to have it was taken against the near-unanimous advice of Conservative Members from the area. We did not want it.

Mr. Waddington

I am certainly not prepared to argue that with my hon. Friend because I agree with him. If I had thought that it was feasible after the Government got back to power to scrap the whole concept of the new town, I should have urged the Government to do just that. But it is an unfortunate fact of life that over the years planning decisions had been taken on the basis that the new town would come into existence in that part of Lancashire, and planning decisions had been made which after the summer of 1970 it would have been impossible to reverse. As my hon. Friend well appreciates, there was the additional difficulty that the Government had made it perfectly plain that all pleas from Lancashire for more public investment in the county would fall on deaf ears if we turned down the obvious prospect of more public investment in Lancashire resulting from the setting up of the new town.

But that is not the case that I am arguing now. The case I am arguing now is that to talk about the exclusion of the new town area from the intermediate area, which covers the whole of the rest of Lancashire, apart from Merseyside, is a nonsense and it would not do any good if by some strange device the area were to be excluded from the intermediate area.

What of the situation in North-East Lancashire? One thing is absolutely plain: North-East Lancashire has benefitted and is benefiting enormously from the policies pursued over the last two years. For instance, the 75 per cent. house improvement grants are already beginning to have effect on the appearance of our towns. I can go through Nelson and see on the ground the result of those policies. My only regret is that there is no way under the Act by which the Government could give one or two authorities in North-East Lancashire which are still not making anything like full use of the Act a hearty kick in the backside.

Secondly, the dereliction grants are being used to good effect; Operation Eyesore has created an immediate impression. One can go through the towns of North-East Lancashire and see dowdy old buildings suddenly sparkling and clean again with all their stonework showing up to the best advantage.

Thirdly, there are the industrial incentives which have been available since 1969 and which have helped to bring new industry to the area. The hon. Member for Accrington (Mr. Arthur Davidson) is perfectly entitled to plead the special problems of Accrington, and I know that Accrington has been faced with special problems as the result of one closure; all of us have found in our constituencies that the whole atmosphere can change as the result of one closure. But employment statistics can be distorted as a result of one closure. We must face the fact that unemployment figures in North-East Lancashire as a whole are much better than those for the region as a whole. We must not overstate our case.

Mr. Arthur Davidson

Nor must the hon. and learned Gentleman mis-state my case. He implies that the problems of Accrington stem from one factory closure, but that is not so. As he knows, there have been several factory closures in Accrington, redundancies and a great deal of short time.

Mr. Waddington

One must be careful not to over-state the case, and I could not agree with the extraordinary demand by the North-East Lancashire Development Committee that the Government should make North-East Lancashire a development area. The unemployment rate in North-East Lancashire is lower than that in the North-West area as a whole. One does no good to one's case and no good to North-East Lancashire if one goes around crying "Doom" and saying that the problems are much worse than they are. My personal view is that what we should be doing is not crying "Doom" but going out and selling ourselves.

or instance, we should be pointing out that ours is a fine part of the country in which to live, that one can be in the centre of a town and yet within only a few hundred yards of beautiful countryside. We should be pointing out that land prices and house prices are still relatively low compared with other parts of the country. We should be pointing out that we have excellent schools and colleges of further education, hospitals and recreational facilities. Above all, we should be pointing out that we have a work force that is second to none, that has an excellent record of industrial relations and is willing to adapt itself to the sort of industrial change with which we have had to cope in North-East Lancashire in the last 20 to 30 years.

Mr. Alfred Morris (Manchester, Wythenshawe)

The hon. and learned Member has spoken of unemployment among people in North-East Lancashire and in the North-West as a whole. There is a far more sombre aspect. The incidence of unemployment among severely disabled people seeking work is 16.3 per cent. in the North-West of England, which is much higher than for the country as a whole.

I know that the hon. Gentleman shares my interest in seeking to make life better for disabled people. Would he not agree that in this debate the position of disabled people in the North-West should be strongly urged?

Mr. Waddington

I am grateful for that intervention, because the hon. Gentleman has now been able to make that valid comment. I can assure him that it was not left out of my speech and it would not be left out of the speech of any Member because it was considered of little importance but simply because of the pressures of time. I entirely agree that all of us should explore the possibilities of getting more and more disabled people placed in industry.

Of course, there is more that the Government can do. I support the call for Government encouragement of office development in the assisted areas, the call for higher dereliction grants, the call for more public investment in the county as a whole, the call made by the North-East Lanacashire Development Committee for the provision of more advance factories in North-East Lancashire and the call for selective assistance for specific industries under the new legislation. But at the end of the day our prosperity is bound up very closely with the prosperity of the country as a whole, and the Government's policy of reduced taxation and economic expansion gives us in the North-West vast opportunities which we should now grasp with both hands.

6.20 p.m.

Mr. James Lamond (Oldham, East)

I wish to concentrate on the textile industry, but first I should like to say something about the point made by the hon. and learned Member for Nelson and Colne (Mr. Waddington) about the letter from Councillor Arnold Tweedale, chairman of the NorthWest Industrial Development Association. It is true that Councillor Tweedale wrote to the Prime Minister to thank him for what had been done but it would have been churlish for him to do anything other, because the Association had been pressing for a long time for those things to be done. It recognises that what has been done will be of value to the area, although it has been quite a long time in coming about. Therefore, we must not quote the letter as an indication that all is well in the North-West