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Volume 927: debated on Tuesday 1 March 1977

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Minimum Wage


asked the Secretary of State for Employment if he will communicate with the relevant interests with a view to introducing a national minimum wage; and if he will make a statement.

Since the Government took office, the most practical approach to the problem of low pay has been the special provision included in the TUC guidelines for negotiators. We have been glad to endorse these provisions and we are taking steps to improve enforcement of existing statutory minimum pay in wages council industries.

Is my hon. Friend aware that from time to time in the House there is criticism that some people are better off on social security than when they are working? Would he not agree that this is due not to the fact that the social security scales are too high but to the fact that many workers' wages are too low? Will he therefore take the initiative to ensure that a national minimum wage is fixed above the level of social security scales to correct this anomaly?

I think that there is widespread recognition of the problem to which my hon. Friend has referred. With respect to my hon. Friend, however, I suggest that perhaps the way he has proposed is not the right way to tackle it. Wages policy alone will not eliminate the problem; social security benefits and fiscal policies have their rôle to play too.

Since the cost of raising a family is so much larger than the cost of a household with only one or two people, would it not be better to solve the problem of poverty in families where the breadwinner is in employment by raising family allowances?

I agree with the hon. Gentleman that blanket provision across the board, by its failure to discriminate, will not tackle the pockets of poverty which undeniably exist. It is better to have a discriminatory approach in the provision of social security benefits, perhaps supplemented by fiscal policies. The hon. Gentleman will recognise that social security benefit policies are not matters for me.

Can my hon. Friend say what additional and urgent steps are being taken to make sure that employers obey the law in respect of people who are subject to wages council orders?

The House will have seen the widespread publicity which has rightly been accorded to the blitzes, as they have been described, launched by my hon. Friend the Under-Secretary of State. These have exposed the extent of underpayment and have most beneficially concentrated the attention of those directly concerned on the need to comply with the statutory minima. My hon. Friend has now launched a series of talks with the TUC, the CBI and other interests to see how much further this can be carried out and made effective. In the meantime, proposals for further blitzes are, I understand, on the agenda.

Is it not a fact that if a national minimum wage was established at a high enough level to get over the problem that people with large families can in certain circumstances get a higher take-home income when they are out of work than when they are in work, the net effect of such a high minimum wage would be to destroy a large number of jobs?

I am not sure that I want to enter into a dialogue with the hon. Gentleman on that aspect. In countries where a national minimum wage has been introduced, there has been a speedy restoration of the differential that it set out to eliminate in the first place. An inter departmental committee was set up in the late 1960s to inquire into a national minimum wage and its possible effects. A report was published by the Department of Employment in 1969, and many of the areas which have been subject to questions are dealt with in that report. Perhaps we might usefully refresh our memories by looking at it again.

Large Cities And Towns


asked the Secretary of State for Employment to what factors he attributes the rise in unemployment in large cities and towns since the present administration took office in 1974.


asked the Secretary of State for Employment to what factors he attributes the rise in unemployment in large cities and towns since the present administration took office in 1974.


asked the Secretary of State for Employment to what factors he attributes the rise in unemployment in large cities and towns since the present administration took office in 1974.

The extent of the rise in unemployment that has taken place since February 1974 varies considerably between different cities and towns. These increases are in part a reflection of the present economic recession and in part a reflection of more fundamental changes taking place in the structure of employment.

These changes in the structure of employment—which reflect partly national trends and partly factors that are special to the larger conurbations—have led to an underlying increase in unemployment, which has been going on for between 10 and 15 years.

Does the right hon. Gentleman expect the House to believe that the Government's economic, industrial and financial policies have nothing to do with the increase in unemployment in virtually every town and city in the country?

Many of the Government's policies have sustained a considerable amount of employment in the large conurbations and the cities. The increase in the number of people employed in the public services has particularly helped.

Will the right hon. Gentleman learn from the Government's mistakes and accept that the unending increase in taxation legislation has placed an appalling burden on small businesses? Will he also recognise that a large number of jobs have been lost in the small business sector as a result?

We are, of course, concerned about the loss of jobs in any part of the economy, including the small business sector. This is an area that I am studying with a view to seeing how far measures operated by my Department may be adapted or even built upon to provide some assistance.

Does the Secretary of State realise that the Government's regional policies are completely unrealistic in attempting to deal with the appalling unemployment problems of the conurbations? Is he aware that every time he goes to the Dispatch Box the situation gets worse? Will he now have another close look at regional policy and see that the limited resources are concentrated upon those urban areas which are suffering the greatest hardship?

To take a minor point first, the situation does not get worse every time that I come to the Dispatch Box. On several occasions recently there has been a drop in the number of unemployed. In so far as we can identify a special problem with conurbations, I know that the hon. Gentleman will appreciate that the fall in manufacturing employment has been faster in the conurbations than in the country generally. It is that to which we have to devote attention in pursuing an industrial and economic strategy to deal with the unemployment problem.

Does my right hon. Friend agree that a figure of 80,000 unemployed in the city of Liverpool means that Liverpool is now becoming a disaster area? Apart from the question of the Government changing their basic economic and industrial strategy, which is essential, cannot something now be done at least to convene a conference on Merseyside, where serious proposals might be put forward aimed at bringing down the high level of unemployment?

Certainly on Merseyside, as in Sunderland, there is a serious unemployment problem. A committee of Ministers is well advanced in studying the special problems of conurbation areas taking into account the special employment problems. I hope to be able to announce very shortly in the House some development of my Department's measures which will have a bearing on this as well as on other matters.

Will my right hon. Friend not agree that the temporary employment subsidy has saved 181,000 jobs in towns and cities and elsewhere? Ought not that scheme to be extended, at least until the end of this year?

The extension of the temporary employment subsidy is one of the major matters being considered by the Department of Employment. There has been a considerable uptake in the subsidy over the past few months during which the scheme has been operating. We shall shortly be facing the problem of certain firms whose 12-months' subsidy is coming to an end. This matter is under urgent review.

Does the target of 700,000 unemployed by 1978 still represent Government policy, or is there now some new Government target?

No. The Government have not adopted any new target. We are aiming to bring unemployment down in that period as rapidly as we can.

Training (Northern Region)


asked the Secretary of State for Employment what measures he is taking to promote the development of industrial training in the Northern Region.

The Northern Region has seven skillcentres plus three annexes, providing 2,013 training places in all. I am informed by the Manpower Services Commission that this is a higher proportion of skillcentre places to working population than in any other region and is considered adequate for the present needs of the region. In addition, over 4,500 people were receiving training in January 1977 in colleges of further education and employers' establishments. The Training Services Agency will continue to make use of spare capacity in local colleges of further education and employers' establishments to develop industrial training.

I am grateful to my hon. Friend for that detailed answer. Is he aware that there is a widespread feeling in the Northern Region that there is a greater need for group schemes, especially to cater for the smaller engineering employer in some of the more scattered areas of the region, some of whom, among other things, experience financial difficulties in making provision for training? Will my hon. Friend look into that?

That is a valuable and useful contribution. As my hon. Friend said, some of the firms are likely to be particularly benefited by such group schemes. I shall draw my hon. Friend's remarks to the attention of the Chairman of the Engineering Industry Training Board. No doubt he will be interested and will be in touch with my hon. Friend. I shall also draw my hon. Friend's remarks to the attention of the Training Services Agency.

Several Hon. Members rose

Is it not a fact that there is an apparent reluctance on the part of people throughout the country to enter training centres to learn skills that would get them jobs in the engineering industry, such as capstan lathe-setting and operating, and milling and grinding? Is it not the case that there is a considerable shortage of people with these skills and that, once trained, such people could get employment almost immediately? What steps can the Minister take to stimulate people into undertaking this type of training?

It is true that in some areas there are such shortages of skilled engineeering craftsmen. However, there are difficulties in matching the needs of one region in terms of the vacancies there with the surplus of manpower in another. It is here that the Employment Services Agency has a rôle to play in enabling greater mobility of labour.

Will my hon. Friend take into account the fact that the Northern Region has always been heavily handicapped by unemployment and a lack of training services? While he is building up the efficiency of the training services and the number of training places in the region, will he also try to bring up the Yorkshire and Humberside Region to the same standard?

My hon. Friend, who has a constituency adjacent to mine, will be delighted to learn that it is hoped that the Doncaster skillcentre will be open this year.

Manpower Services Commission


asked the Secretary of State for Employment when he last met the chairman of the Manpower Services Commission.

Was my right hon. Friend able to discuss with the chairman the particularly difficult situation concerning training opportunities for girls, bearing in mind two points: first the reduction in college of education places, particularly as this affects opportunities for girls and secondly the deplorable record of British industry over the past decade in offering day-release facilities for girls?

Training was one of the subjects that I discussed with the chairman. My hon. Friend will be pleased to learn that the Training Services Agency has identified training in certain vocations for girls as a priority area. However, I point out that we are giving considerable support—about £55 million worth—to training in industry and that there is no sex discrimination in this form of vocational training. I am sure that a number of young male engineering apprentices will not object to a few female workmates.

While I do not wish to deny the importance of training, may I ask the Secretary of State to take note of what is happening at the Bristol West Dock, where the ratepayers have put in millions of pounds to build a new dock, which has not started operating because of an industrial dispute? Will the right hon. Gentleman give his immediate attention to this problem and use the good offices of his Department to try to get things going?

I am not quite sure how that supplementary question relates to the original Question. One of the many reasons why we have devoted so much time and attention to improving industrial relations is that some disputes can produce a loss of work. There has been an overall improvement, and I would have thought that that would have been welcomed by the hon. Gentleman.

School Leavers (London)

asked the Secretary of State for Employment how many young people who left school in 1976 or earlier are still unemployed in South-East London.

On 13th January 1977, the latest date on which the unemployed were analysed by age groups, 7,103 young people under 20 years of age, of whom 2,675 were school leavers, who are defined as those still seeking their first employment, were registered as unemployed in South-East London. By 10th February 1977 the number of school leavers unemployed had fallen to 2,190. The statistics do not identify the date of leaving school but it is known that most of these were 1976 summer term leavers.

Does my hon. Friend agree that these scandalous figures show that South-East London is in quite as bad a position as many of the regions? Does he not agree that it is disgraceful that we should be paying thousands of youngsters to do nothing? Is he aware that the form of unemployment benefit often discourages young people from going back to school or from getting further training? Will the Government come forward with an opportunity guarantee to see that youngsters who cannot find jobs are given something useful to do from the time they leave school?

The figures are very disturbing, but they are much more disturbing in Lambeth, Lewisham and Southwark than they are in Bexley, Bromley and Croydon. There is a very big difference between these areas. The idea that my hon. Friend put forward is in line with the social contract aim to provide further education opportunities for all young people, disabled or not. This idea is being examined by the Manpower Services Commission, and we are looking forward to getting its observations on this aim as quickly as possible.

Can the Minister tell the House whether discussions are taking place with the Department of Education and Science to discover what educational skills school leavers have, and whether there is a high correlation between lack of achievement and ability and the failure to get jobs?

We do not need discussions or inquiries to establish that. There is a very strong correlation between unemployed youngsters and those with a lack of training and qualifications.

Will the Minister take very seriously the remarks of his hon. Friend the Member for Lewisham, West (Mr. Price)? The whole House feels that the various methods we have at the moment for helping school leavers are not adequate and are not likely to be so over the next few years. What is required is a comprehensive training scheme to enable young people to go from school to some form of training that they feel is worth while and that the country can afford.

Because we believe that very stronely, we have the Manpower Services Commission working on the feasibility of such a programme at present. The real problem is not with the school leaver—there has been a dramatic fall in the number of school leavers unemployed—but with unemployment among young people under 20 who are unqualified and untrained.

Is my hon. Friend satisfied with the standard of equipment that youngsters receiving craft apprentice training are being forced to use? Is he aware that at the Percival Whitley College at Halifax youngsters are serving apprenticeships on clapped-out machinery the like of which they would never meet in private industry? Will he have discussions to ensure that craft apprentices are given proper equipment on which to serve their apprenticeships?

The mass of complaints that I receive are centred on the fact that training is very often on machinery that is far better than that used outside in private industry. When I visit my hon. Friend's constituency I will look into this problem.

Safety Officers


asked the Secretary of State for Employment when he proposes to implement the regulations in the Health and Safety at Work Act etc. 1974 providing for the appointment of union-nominated safety officers; and if he will make a statement.

As my hon. Friend the Minister of State for Employment told the House on 1st February, the regulations will come into operation on 1st October 1978, and, as I told my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) yesterday, they are now being printed and should be laid before Parliament by the end of March.

I appreciate that reply. Why have the Government adopted such a leisurely approach to such an urgent problem? Surely a delay of three months is excessive.

I do not think that we have adopted a leisurely approach. We would like to see the regulations brought in earlier. The Government have given this matter the closest possible scrutiny, but we must have regard to the current expenditure restraints. The position does not preclude the making of voluntary arrangements, and the Government would welcome that because we believe that there should be a lead-in period. Discussions with shop stewards in the regions show that there is a need for further preparations and clarification before the regulations become effective.

What discussions has the Minister had with shop floor supervisors and junior management? Their morale is very low at present. What representations has he received from industrial groups to delay these regulations and stop the irritant to industrial relations at supervisory level?

Before the hon. Gentleman distorts the facts, he should at least get them right. I have received no representations against the regulations from industry or industrialists. The CBI and the TUC together as members of the Health and Safety Commission have expressed a desire for the implementation of the regulations. There has been a very long period of consultation on the document issued by the Health and Safety Commission, so there is no foundation at all in the hon. Member's remarks.

How many men and women have lost their lives or received serious injury in industrial accidents in the past 12 months? What representations has the Minister received from the trade unions on the setting up of safety committees?

I will write to my hon. Friend about the first point and give him the exact figures. Of course, we received many representations prior to the period in which my hon. Friend made his announcement of the regulations being laid. There was considerable disappointment that we were not going ahead with them immediately. But the TUC has accepted the date that we announced, and so has the Commission. In fact, we have had very few representations about the date.

Textile Industry


asked the Sec retary of State for Employment by what number the labour force engaged in the textile industry has decreased during the last 10 years.

Between June 1966 and June 1976 the number of employees in employment in the textiles industry in Great Britain decreased by 221,000.

Is my hon. Friend aware that, despite the greatly diminished number of people employed in the industry, over the same period the output has been increased by some 30 per cent.? Does he recognise that this applies gen- erally throughout manufacturing industry and that it is time that the Government reappraised their approach by reducing the length of the working week and the working lifetime?

The increase in productivity is needed to maintain the present level of employment. Certainly, my right hon. Friend the Prime Minister has said that we should perhaps look, together with other countries, at the whole question of the working week.

Does my hon. Friend agree that the measure that has been of greatest help to the textile and footwear industries is the temporary employment subsidy? I was pleased to hear the Secretary of State say that an early decision would be taken on this issue. Can my hon. Friend give more precise details as many firms and employers are depending on it for the future?

The decision on the temporary employment subsidy will have to take place in the context of the Budget, because it is of enormous importance to British industry at present. Some 40,000 jobs have been saved in the textile industry.

Will my hon. Friend convey these figures to the Secretary of State for Trade and ask him to bear them in mind when he is arranging negotiations for a new Multifibre Arrangement? Such an agreement badly needs strengthening in the interests of textile workers in this country.

Certainly, my right hon. Friend is well aware of the problems that the textile industry has faced over the last 10 years. He will do all he can, against this background, to get the best possible arrangement for the textile industry.

Deaf Persons


asked the Secretary of State for Employment what action he is taking to facilitate the employment of deaf people.

I am informed by the Manpower Services Commission that the Employment Service Agency, together with the Training Services Agency, provides a comprehensive range of services to help all disabled people, including deaf people, to get jobs. These services include the specialist attention of over 500 disablement resettlement officers, who advise about suitable employment; rehabilitation and in-depth assessment and guidance at any of the Agency's 26 employment rehabilitation centres; the loan of certain special aids to employment if these are required; and the training courses available under the Training Opportunities Scheme.

Deaf people who possess the requisite qualifications for entry to professional or degree courses are also eligible for help under the Training Services Agency's professional training scheme.

I am grateful for that reply. Does not the Minister agree that employers underestimate the capabilities, particularly in technical respects, of deaf people? Since the Department employs placement officers for the blind, will the hon. Gentleman consider using them to facilitate the employment of deaf people?

I agree that many employers undervalue disabled people generally, not only people who are deaf. We hope to be able to assist the situation by publishing a guide to employers that will shortly be produced by the Manpower Services Commission.

The difficulty about employing specialist officers is that such staff would have to be spread thinly. It would mean that they would not have the detailed knowledge of local jobs that is most important in the placing of disabled people.

Is not my hon. Friend talking a lot of nonsense when he says that a range of services is available, if he means skilled services? Will he bear in mind that, because of the depth of discrimination against deaf people and the subtlety of the problems they face, we require the services of skilled, energetic resettlement officers for the disabled? Will he do somethig about the matter instead of offering bromides in answer to legitimate questions?

I cannot accept that my answers were bromides. I believe that resettlement officers for the disabled are doing a good and skilled job. I have already given the reason why we do not accept that specialists in this area of activity would make the best contribution.

Does the Minister know what percentage of registered disabled people are deaf and are at the same time unemployed?

What progress has been made with the proposed scheme to make financial grants to employers who engage a certain category of disabled people?

I am pleased to be able to inform the House that a scheme of grants to employers for adaptation of premises and equipment will be brought into operation by the Manpower Services Commission in the financial year 1977–78. Up to £500,000 is provided in the Estimate. A general condition of the scheme will involve grants for modifications related to the needs of individual disabled people, and grants are considered to be essential to the resettlement of individuals with the employers concerned.

Newcastle Upon Tyne


asked the Secretary of State for Employment by how much unemployment has risen in Newcastle since February 1974.

Between February 1974 and February 1977, the numbers registered as unemployed in Newcastle upon Tyne and Walker employment office areas increased by 4,665.

I recognise that that represents a deplorable increase. Although in the region generally off the peg advance factories, such as recently announced, will help as a whole, does the Minister recognise that there is still an employment problem in city centres? Is he aware that small and medium-size businesses face increasing difficulties in employment because of problems of taxation, congestion and legislation, which make employment more difficult? Will he use his best endeavours with his governmental colleagues to do something for employers in urban areas?

I am well aware of the difficult situation in many of our inner city areas. The hon. Member will know that this is a matter for the Department of Industry, but I shall draw his remarks to that Department's attention.

Is it not a fact that the reason why the figures for unemployed school leavers in urban areas appear to have dropped dramatically is that once school leavers have taken advantage of the Government bonanza they then go to swell the adult unemployment figures? Will the Minister reintroduce the figures for young people so that the House can see the catastrophic situation which has arisen?

In a later reply I shall be giving figures related to the age distribution among the unemployed. I agree that there is a severe problem of unemployment among people under the age of 20. In an earlier reply I corrected the right hon. Member for Lowestoft (Mr. Prior), who said that this problem was most marked among school leavers.

Older Workers (Survey)


asked the Secretary of State for Employment when his Department expects to have the result of the inquiry into why older workers give up or carry on working; and if he will make a statement.

My Department and the Department of Health and Social Security have jointly commissioned this survey from the Office of Population Censuses and Surveys with a view to increasing our understanding of the factors which influence older people to go on working, cease work or modify the nature and amount of work they do. We also hope to find out how their decisions are affected by the various rules which govern the receipt of the national insurance retirement pension. Initial results are expected at the end of this year, with further analyses in the first half of 1978.

As the survey has been jointly conducted with the Department of Health and Social Security, is the Department of Employment using it as a means by which it can make a formal recommendation for the age of retirement to be lowered? If that is not the case, to what practical use will this expensive research be put?

It is not particularly expensive as a piece of research. The estimated cost of the survey is £157,000. There are pressures for a more positive policy in this area involving earlier or more flexible retirement, age discrimination legislation, and generally more protection for older workers. I believe that the survey will be of value in disclosing the facts on those matters.

Does my hon. Friend accept that a major contribution to the solution of our unemployment problems would be made if there were an early extension of the job-swap scheme to all parts of the country and if it were to include other age groups within its compass?

This matter was discussed on Second Reading of the Bill, and if a few more Members are present in Committee we shall be able to discuss the matter generally then.

Construction Industry


asked the Secretary of State for Employment whether he will make a further statement on the level of unemployment in the construction industry; and what proposals he has for reducing it at least to the level of March 1974.

The latest available quarterly figures for the industry in Great Britain are those for August 1976, when 193.800 workers were registered as unemployed. Questions about future programmes of construction work should be addressed to my right hon. Friend the Secretary of State for the Environment. The Government's special employment measures are available to help workers in the construction industry who are unemployed or threatened with redundancy.

Since the work load in the construction industry is so abysmal and is growing steadily worse, will the Government at least insist that the report from the economic development council for building advocating more home ownership—a report which has been suppressed because it may be politically embarrassing—is published as soon as possible?

That is a matter for the NEDC. As for what the report will or will not disclose, I do not know the answer to that matter any more than does the hon. Gentleman, except what has been reported speculatively in the Press. We should find the facts before we make sweeping allegations of that nature.

Does my hon. Friend accept that the construction workers are sick and tired of always being hit by slumps? Is it not time that the Government got down to arranging some sort of crash programme to insist that the construction industry must build more houses, help in home improvements and assist local authorities to take their plans out of pigeon-holes to ensure that more use is made of construction workers on public buildings?

I share my hon. Friend's concern about unemployment in the construction industry. I hope that he will take some small comfort from the recent fall in interest rates, which is expected to lead to an increased demand for building in the private sector and has considerably improved the competitive position in the building societies. I hope that that will give some comfort and help to the building industry.

Will the Minister discuss with the Secretary of State for Industry and the Chancellor of the Exchequer the case for increasing development grants for new industrial building to promote construction and renovation in older areas? If necessary, will he consider making reductions in grants on new machinery to offset the cost as a switch in balance would be beneficial?

Of course, the hon. Gentleman knows that these matters are readily recognised by the Secretary of State for Industry. But it is equally recognised that the Government's industrial and economic strategy is one of providing for more assistance in the measures that are being taken in terms of Sections 7 and 8 of the Industry Act. I hope that in that way the Department of Industry will be able to express a positive response to the kind of strategy of which the hon. Gentleman spoke.

Does my hon. Friend realise that by cutting public spending he will automatically cut back on manufacturing industry? Does he not appreciate that the six-month moratorium on public utilities that arose out of the last set of measures in December and the housing cut-back of last July are throwing pipe-workers out of work and putting them on short time in North Derbyshire, in the Stanton and Staveley areas, and other regions throughout the country? If the Minister really wants to put things on a sound basis and footing, should he not stop listening to Members of the Opposition who are demanding public spending cuts?

My hon. Friend will recall that when my right hon. Friend the Chancellor of the Exchequer made his statement in December he made it quite clear that the programme that he was then announcing would not of itself lead to increased unemployment and that any increase in unemployment would be the result of other factors, such as the general state of the world economy. Our aim must be to achieve a general strengthening of the economy and to provide a sound basis for construction and other industries.

Northern Region


asked the Secretary of State for Employment whether he is satisfied with the level of unemployment in the Northern Region.

No. That is why in addition to the allocation of an extra £145 million for training purposes, the Government have introduced a number of special measures to alleviate the worst effects of unemployment. These include the temporary employment subsidy, the job creation programme, the work experience scheme, the recruitment subsidy for school leavers, the youth employment subsidy, the job release scheme, and the strengthening of the careers service. So far, these measures have benefited more than 28,000 workers in the Northern Region.

I thank my hon. Friend for that answer. In view of the high level of unemployment in the Northern Region, should not the Government consider introducing a new regional incentive to make up for the withdrawal of the regional employment premium?

The policy of the Government is quite clear. We intend to provide selective assistance to industry rather than assistance on the basis of geography.

Does not my hon. Friend realise that the sudden abolition of the regional employment premium has caused serious anxiety in the area? Is there not a need—in addition to the temporary measures that the Minister has mentioned—for some long-term industrial grant linked with the employment provisions of the industrial projects?

With the announcement of the abolition of the regional employment premium, which will not end before the end of March, came an expansion of the temporary employment subsidy. The Northern Region has already had 10,762 jobs saved by the temporary employment subsidy and the area stands to benefit from its extension.

Is the Minister satisfied with the level of employment on Humberside? Since the Minister was unable to go there himself, will he confer with the Minister of State, who will be visiting Hull this weekend? In the light of that consultation, will he make a statement next week about our difficulties on Humberside?

It was not a question of my not wanting to go to Hull. I am not satisfied with the level of unemployment in any part of the United Kingdom and my hon. Friend will bear that in mind when he makes his visit.

Job Creation


asked the Secretary of State for Employment how many new jobs he estimates need to be created by 1980 to provide employment for those coming on to the labour market, either for the first time, through technological innovation, or increased productivity.

If present trends continue, we estimate that about 140,000 additional people each year may be seeking employment. No reliable estimates exist of the employment effects of technological innovation or increased productivity.

Is my hon. Friend aware that estimates have been made that about 2 million new jobs will be needed to take account of the factors mentioned in the Question? Does he agree that the country's track record in creating new jobs, particularly in manufacturing industry, has left a great deal to be desired? Does the Minister also agree that sustained public expenditure cuts over a long period will aggravate and not improve the situation?

My hon. Friend knows that public expenditure restraint is an integral part of the Government's economic and industrial strategy, and we believe that that strategy is the right road to full employment.

City Of London



asked the Prime Minister when he last visited the City of London.


I last visited the City of London on 16th February when I attended the annual dinner of the British Overseas Trade Board and its Advisory Council.

Is the Prime Minister aware that both the City of London and British industry are gravely concerned about the fragile condition of British Leyland? Does the Prime Minister recall that in 1975 the Government said that future public money for British Leyland would depend on better industrial relations and increased productivity? Does he not agree that industrial relations at Leyland are in a parlous state and that production is only one-third of total capacity? When will the Government decide that enough is enough?

The hon. Gentleman has called attention to a serious problem. The funds that were made available by the Government and that are committed will of course continue to be made available, but there must be a review of the situation before further funds are committed. As the hon. Gentleman may know, the Secretary of State for Industry yesterday had a lettter from the National Enterprise Board. The Government are giving serious consideration to this and my right hon. Friend will make a statement as soon as we have been able to conclude our deliberations.

On industrial relations, I recognise the difficulties that have arisen as a result of the pay policy of the past two years and that the policy has created difficulties with differentials, but it has been a necessary step in overcoming inflation. I say to those who are concerned about differentials that perhaps the biggest differential of all is between the man who is in a job and the man who is out of one, and some of them could be out of one.

Is not the most helpful thing the Prime Minister could say to British Leyland that stage 3 of the policy will be more flexible? Would it not be the supreme irony and very sad if the social contract in the end was responsible for bringing down British Leyland?

I am grateful for the first part of the hon. Gentleman's question because it gives me an opportunity to say that the discussions with the trade union movement will clearly have to be on the basis of a more flexible policy than there has been during the past two years. I have made this clear from the Dispatch Box time after time, and I hope that this will be understood in British Leyland.

As the TUC does not wish to come to a conclusion on this matter until after the Budget, it is not possible for us to reach finality now. I hope that those in British Leyland who feel that they have a genuine grievance—and I do not deny that—will remember that the agreement runs out in August and that thereafter—and possibly before then if an agreement is concluded—there will be an opportunity to get greater flexibility. The Secretary of State for Industry is considering the position of Leyland and he will make a statement to the House as soon as he can.

Is the Prime Minister aware that last month foreign-made cars accounted for 43 per cent. of the home market? Given that choice and preference of the taxpayer, how much longer does the Prime Minister think that the British taxpayer will be willing to pour money into British Leyland to produce cars that are increasingly not wanted at home and to support a company that is, regrettably, giving a worse name to British industry every day?

I hope that we shall not carry that point too far, because I am sure that the hon. Gentleman does not want to pour scorn on an important British national asset. British Leyland's record last year was that the company failed to produce about 200,000 cars that had been included in its plan. I hope that Leyland understands that not only European car manufacturers but the Japanese are simply waiting to pour cars into this country for every car that we fail to produce.

When he visits the City of London will the Prime Minister discuss with what is probably the wealthiest local authority in the world the situation of tenants living in the Barbican, who not protected by the Rent Acts and who are in dire need because there is no willingness on behalf of the City of London to protect the interests of these people?

Perhaps my hon. Friend will put that question to the appropriate Minister. I shall draw it to his attention, but I am not sure that it is a responsibility for a Minister.

Will the right hon. Gentleman give no credence to the new myth that the problems of British Leyland are due to the pay policy? Is he aware that the problems of Leyland pre-dated the present policy and the last Government's pay policy? Will he also not go to the City of London for advice on how to run Leyland, because the City has already virtually destroyed the company? Will he look at Meriden, which has not been disrupted by the pay policy, and draw the appropriate conclusion?

I shall take all those considerations into account with pleasure. I have never thought that there was any particular connection between the Question on the Order Paper and the supplementaries that I am asked, so the hon. Gentleman can be certain that I shall not be going to the City for that purpose.

Is the right hon. Gentleman aware that we are asking whether the problems of Leyland do not demonstrate the weaknesses of his two main pillars of policy, the social contract and the industrial strategy? Are they not mutually incompatible? Does he not agree that we are getting neither the production from the nation as a whole nor the productivity that we need because we have neither a pay policy that allows for differentials nor a taxation policy that permits of incentives?

The right hon. Lady is adding to her consistent policy of a completely negative approach on all these questions. She is aware that although she failed to support the incomes policy, some of her spokesmen did, including the Opposition spokesman on Treasury policy. I do not know why she should go back on his policy in this matter. The right hon. Lady is consistently negative on this matter and on industrial strategy. She is consistently negative on industrial democracy and consistently negative on devolution. Indeed, it is difficult to know what she stands for on any single issue.

Is not the right hon. Gentleman aware that the negative thing is to refuse differentials and the negative thing is to refuse incentives? Does he not realise that the positive thing is to give differentials for skill and the positive thing is to give incentives? Only in this way shall we get the positive results that his Government will never get.

The only way in which the right hon. Lady exceeds her capacity for a negative approach is in her capacity for stating the obvious. The Government's position on differentials has been made completely clear. I made it clear in my answer to the hon. Member for Surrey, North-West (Mr. Grylls), who asked a constructive question on this matter earlier. The right hon. Lady is not trying to help industrial relations in this matter; nor is she concerned with the future welfare of British industry. She has only one concern—naked ambition.

Royal Commission On Legal Services


asked the Prime Minister if he will appoint a further person to the Royal Commission on Legal Services.


asked the Prime Minister if he will recommend the appointment of an additional member to the Royal Commission on Legal Services.

In view of all that has happened since the Prime Minister appointed a Mr. Joseph Haines to the Royal Commission, including the publicaaion of a scandalous breach of confidence in a recent book, is he still convinced that Mr. Haines is a suitable person to sit in judgment on the British legal profession?

In view of that reply, will the Prime Minister tell the House by what criteria he judges whether a man is suitable to sit in judgment on the legal profession?

When I look at the hon. Gentleman, I have no doubts as to what is suitable.

Will the right hon. Gentleman confirm that, among other things, the Royal Commission will have to consider the arrangements foe determining the remuneration of the profession? Since one of the members, Mr. Haines, appears to get his remuneration by selling confidences to the highest bidder and since the legal profession exists, and only subsists, on the basis of trust and confidence between client and lawyer, does the right hen. Gentleman think that this gentleman has very much to offer?

The right hon. Gentleman has suffered a great deal from personal obloquy and should be the last person to pursue that sort of vendetta against someone else.

Does my right hon. Friend agree that the ex-Leader of the Liberal Party is the last person who should be raising matters of this sort, because he was the man who opened supermarkets on the South Coast and got money from pensioners and others—

The right hon. Gentleman was not referring to an hon. Member of the House or I should have intervened earlier.

On a point of order, Mr. Speaker. I have never opened a supermarket or anything else on the South Coast.

It is a well-known fact that the right hon. Gentleman was involved in opening supermarkets and being paid appearance money by London and County Securities Limited when he was a director of that company and when the auditor had already published the result of his investigation on the accounts and the books of the company had been in default.

Chancellor Of The Exchequer


asked the Prime Minister if he will list the responsibilities which he has allocated to the Chancellor of the Exchequer.

The Chancellor of the Exchequer is responsible for all Treasury business, including the direction of economic and financial policy and the control of public expenditure. He is the Minister responsible for the Inland Revenue and Customs and Excise and some other smaller Departments. The Chancellor is also Chairman of NEDC and a governor of the International Monetary Fund.

Can my right hon. Friend give the House his views on the proposal by the Cabinet Secretary for splitting the Treasury into different parts and, in particular, on the proposal, which had the support of his two predecessors, for putting the public expenditure part of the Treasury into the Civil Service Department?

I have been reading the evidence with very great interest and watching some of the articles appearing in the Press. I shall continue to give these matters my full consideration and if I have any change to propose I shall inform the House.

Will the right hon. Gentleman take this opportunity to tell the House and the country what he has so far refused to tell us, namely, what are the responsibilities between himself and the Chancellor of the Exchequer in view of his position as economic overlord, about which we have heard so much but seen so little?

I repeat that I have taken over no responsibilities from the Chancellor of the Exchequer, but I am still First Lord of the Treasury.

The problem of unemployment is one that afflicts the whole of the Western industrialised world. I propose to discuss these matters with President Carter when I visit the United States next week and also to raise them at the Rome European Council, because it is clear that no one nation can return to full employment on its own. It will require international effort and we shall bend all our efforts to secure that at the earliest possible moment.

Does the Prime Minister recall a letter that the Chancellor of the Exchequer wrote on 15th December 1976 to the managing director of the International Monetary Fund in which he stated that it would be a continuing part of the Government's strategy to reduce the share of resources taken by the public sector? Will the right hon. Gentleman take this opportunity of confirming that that is still an essential element of Government strategy?

Yes, we shall keep to the formula agreed with the International Monetary Fund. If circumstances change, we shall have other discussions with it. If the circumstances change, the arrangements can be changed.

If the rate of inflation is likely to rise to 17 per cent. year on year together with massive unemployment, the two things happening together, does that not suggest that the Treasury has failed in its purpose? Is it not time to reconsider the dismantling of the Treasury? If we are serious about job creation, should we not have an economic directorate to replace the parts of the Treasury that have singularly failed to intervene in the economy and done nothing to put right the shortcomings of a free market system?

Although there may be advantages in changing the machinery of the Treasury and in making other combinations, I express no view on that this afternoon. I do not think that will solve the fundamental economic problems that we face, although it may make for a better organising of them.

As a result of the depreciation of sterling last autumn, together with the increase in food prices, inflation will be at a higher level than we had expected or were working for in the first half of this year, but I repeat as strongly as I can that if we can get a third round in the wages agreement, on the present forecasts and from what we can see of matters such as the strength of sterling and the price of imported commodities and food and raw materials, there is every reason for there to be a substantial falling away in the rate of inflation in the second half of this year and the first half of 1978.

Is the Chancellor of the Exchequer still responsible for devising the formula by which the current rate of inflation is dinned into the public's mind? If so, by how much is it reduced from the 84 per cent., which is the figure that he gave us so clearly during the last election?

The figure of 8·4 per cent. has been explained many times as a short-term forecast over a period of three months. I try to give the House the most accurate forecasts but I regret to say that, as others have discovered before me and no doubt will discover after me, they are usually wrong. However, we must try to take some account of what is forecast. The best forecast that I can give the House now is the one that I have already given, namely, an increase during the first half of this year and a rapid falling away from the middle of 1977 to the middle of 1978.

Does the Prime Minister agree that it would be quite wrong for his hon. Friend the Member for Tottenham (Mr. Atkinson) to blame the Treasury for the high rate of inflation and the high rate of unemployment? Would it not be better if the Government considered their own record and did the necessary thing?

I do not think that it would be altogether fair to blame the Treasury. I blame the previous Government. The right hon. Gentleman was a distinguished ornament of a Government who printed money like a drunken sailor on his first night ashore. At least his Government hold this record, namely, that the rate of expansion of the money supply under the Administration of which he was an ornament has never been exceeded in this country before. Thank heavens a Labour Government came in and started to put matters right.

New Member

The following Member took and subscribed the Oath:

Peter Leonard Brooke, Esq., for City of London and Westminster, South.