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With regard to workers' rights and citizens' rights, which everyone has, as the hon. Gentleman knows, the ordinary trade union member has far more rights now than previously. The ordinary citizen now has a greater chance to become a capitalist than ever before. We should like to extend that to other countries, as would many other member states.

Mr. Julian Brazier (Canterbury) : In seeking assistance from our friends and allies in Europe, did my right hon. Friend the Prime Minister reflect on how much easier that task must have been 10 years ago for her predecessor when he could fully rely on her, the Leader of the Opposition at the time, to maintain a fully united front against terrorism? Will she further reflect on the fact that, whatever may take place in this House, the British people are right behind her right across the political spectrum?

The Prime Minister : Judging from the post-bag after the Bruges speech and from the many signs that we have had after returning from Rhodes, I accept what my hon. Friend says.

Mr. D. N. Campbell-Savours (Workington) : The Prime Minister said earlier that she had been fighting terrorism in every way. When she met Mr. Haughey, did she refer to k and r--kidnap and

ransom--insurance? Is there not a huge hole in the Prevention of Terrorism (Temporary Provisions) Bill in so far as it does not ban that practice which is a major source of funds for the paramilitary groups in Northern Ireland?

The Prime Minister : That matter has come up on several previous occasions. We have considered it and, at the moment, as the hon. Gentleman is aware, even if we refuse to have it in this country, some of it would go elsewhere. We must have agreement across countries that that is not acceptable. If we could achieve that, that would be very effective. I agree with the hon. Gentleman and am wholly against the taking out of any such insurance.

Mr. Ian Bruce (Dorset, South) : Does my right hon. Friend agree that we have no mandate for bringing forward a united states of Europe, for the equalisation of taxes, or for social tinkering? When the British people voted in the referendum many years ago, they supported a free market in Europe. They still support that. The British people support my right hon. Friend as the leader within Europe of that free market principle.

The Prime Minister : I accept that we signed up to a European Economic Community.

Mr. David Winnick (Walsall, North) : Like my hon. Friends, I am no less opposed to terrorism in Northern Ireland than the Prime Minister. However, on reflection, will the right hon. Lady consider that the manner in which she raised the Ryan case in this House and at the meeting with Mr. Haughey clearly caused the maximum of embarrassment and difficulty to our friends in the Irish Republic and gave a good deal of satisfaction to the IRA and its allies throughout Europe and the United States? Why did the Prime Minister act in a manner more characteristic of her junior Health Minister?

The Prime Minister : The hon. Gentleman is aware that I put the facts and will continue to do that. Bearing in mind that, under the extradition law of the Republic, the provisional warrant which the Irish Attorney-General can

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issue is for three days, it is perfectly clear that the Republic considers that the provisional warrant is for three days and that that is sufficient for it to take a decision whether the warrant should be backed or not.

Mr. Dennis Skinner (Bolsover) : Is the Prime Minister aware that the main reason why she has difficulty in speaking about the problems of the common pound, the common bank and common frontiers is that she made a rod for her own back when she urged her right hon. and hon. Friends to vote on a three-line Whip to carry through the legislation on the single European market? She does not kid Opposition Members when she goes across to those booze-ups like the one in Rhodes and conducts a private brawl to give the impression to the British people that she is really against the Common Market. She does not fool us about that. If she wants to resolve the problem of the common frontiers and all the rest, she should bring forward legislation to repeal the Single European Act and we will give her a chuck on.

The Prime Minister : As is customary from the hon. Gentleman, that was a very confused question. However, if he wants to have a brawl with anyone, he must choose someone who is used to brawling. He had better choose someone his own size.

Mr. Eddie McGrady (South Down) : I welcome the new-found conversion to a green policy and the decision to have a conference in the spring on the ozone layer and the greenhouse effect. Will the Prime Minister explain the apparent contradiction between that new-found concern and the fact that the Government have just announced a considerable reduction in the budget for the institute for research into the environment with the ensuing sacking or redundancy of 300 environmental scientists?

The Prime Minister : The amount for research on the environment, as the hon. Gentleman is aware, is determined by the advisory board which divides it between the scientific research councils, the Medical Research Council, the Natural Environment Research Council and the Agriculture and Food Research Council. The hon. Gentleman is aware that the amount available in real terms for basic research has increased and was increased further as a result of the Autumn Statement. If we had not had an effective amount for research, the British Antarctic survey would never have discovered the gap in the ozone layer.

Mr. Foulkes : What did they discover?

The Prime Minister : The ozone layer was discovered. I am surprised that the hon. Member did not know that.

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Mr. Tony Banks (Newham, North-West) : As most Heads of Government favour the abolition of border controls, would it be legally possible for this country to insist on maintaining border controls if other European countries abolish them?

What was the Prime Minister's opinion about a European federal police force?

The Prime Minister : Yes, it would because, apart from the border with the Republic for which we would have special reason to retain border controls, the external borders of the United Kingdom are international borders as well as internal borders. We must therefore retain our border controls at airports and ports. They will all maintain controls through ports and airports because that is the entry from the outside world. I said earlier that the Trevi Ministers meet frequently and they are moving closer together.

I am not certain whether a federal police force would be advisable. I believe that it would be very difficult to achieve because such a force would have to be answerable specifically to someone, and our present arrangement with co-operation between forces is better.

Mr. Kinnock : There have been several questions on the Criminal Law Jurisdiction Act, which the Prime Minister does not seem to have answered with the necessary clarity. Is she aware that, for the reasons given by my right hon. Friend the Member for Morley and Leeds, South (Mr. Rees), we can understand that, on the conspiracy allegations made against Patrick Ryan, the legal advice may have been that they could not be pressed effectively under the Criminal Law Jurisdiction Act? However, is that the advice that the right hon. Lady has received on the other two allegations against Patrick Ryan--possession of explosives and handling of explosives? Is she saying that if she cannot get everything--including bringing Patrick Ryan from Ireland to this country--she will not take legal means to achieve anything?

The Prime Minister : No, I am not saying that. As I told the right hon. Gentleman, my legal advice is that only two of the four charges would come under that Act. The right hon. Gentleman is making an assumption about which two they are, although I have not told him that. If he wants more specific answers, he knows full well that he must obtain legal advice from the proper officer--my right hon. and learned Friend the Attorney-General or my hon and learned Friend the Solicitor-General.

Let me make it perfectly clear that we believe, nevertheless, in a policy of extradition and that it is far better to extradite people to stand trial in the country in which the offences have been committed.

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Scottish Enterprise

4.22 pm

The Secretary of State for Scotland (Mr. Malcolm Rifkind) : With permission, Mr. Speaker, I should like to make a statement about the White Paper on Scottish Enterprise, laid before Parliament today. The proposals set out in this paper will further strengthen the Scottish economy to meet the challenges of the 1990s by integrating the Government's support for training and for enterprise creation into a new body, Scottish Enterprise.

The Government have already transformed the British economy and given new confidence to industry, commerce and, indeed, the whole business community. We have reformed industrial relations legislation, stimulated increases in productivity, pushed forward a programme of deregulation, and opened up many sectors of the economy to competition through our privatisation programme and by other means. As a result, unemployment is now in sharp decline and enterprise is flourishing.

As these processes have gained in momentum, our two main instruments of direct support to the business of wealth creation in Scotland have seen a change of emphasis. The Scottish Development Agency, in its early years preoccupied with the problems of declining and elderly industries, now has the more positive purposes of accommodating, advising, informing, financing, attracting and developing enterprise, as well as a continuing commitment to renewing our environment. The Training Agency has coped admirably with the difficult and demanding task of alleviating the worst ills of unemployment, but it is now increasingly engaged in the aim of uprating and updating the skills of new entrants to the labour market, of unemployed adults and, indeed, of those in jobs.

As we enter the 1990s, two challenges face us. One is that of international competition, typified by the single European market in 1992. Skills of the highest order will be required at every level as firms increasingly look outward. The other challenge is the prospect of skill shortages. Continued growth is offering the unemployed wider opportunities, while the number of young entrants to the labour market is set to decline in Scotland, as elsewhere.

These challenges are combining to bring into sharp focus the need for a new and integrated approach. Enterprise creation and the growth of existing businesses are inextricably bound up with developing the skills of the work force. Industry is now prospering and able to shoulder its full responsibility for investing in the skills of its work force. Employers have to rediscover fully a sense of ownership of the system of training and enterprise creation. It is my hope that the proposals I am announcing today will constitute a quantum leap forward in this process.

Our proposals involve the creation of a new national body, Scottish Enterprise, whose main role will be to consider strategic issues relating to enterprise, employment creation and training and a network of employer- led local agencies, which will be responsible for stimulating the growth of self-sustaining enterprise, encouraging the creation of viable jobs and improving the skills of the work force in each area.

Scottish Enterprise will be a powerful agent for change. The statutory functions and powers of Scottish Enterprise

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will be broadly like those in the Scottish Development Agency Act 1975, as amended, together with the powers in the Employment and Training Act 1973, as amended. Consequently, Scottish Enterprise will have a wide-ranging remit to enable it to continue the process of building the enterprise culture in Scotland.

It will continue the vital ongoing work of the SDA, but in addition, and for the first time, training in Scotland will be delivered through a Scottish body, working within a training policy framework for Great Britain agreed with my right hon. Friend the Secretary of State for Employment, but answerable to and provided with its resources by the Secretary of State for Scotland. Broadly speaking, Scottish Enterprise can be expected to receive the level of funding which would otherwise have been provided both for the Scottish Development Agency and for training programmes in Scotland. In the current year, that would amount to the best part of £500 million. The challenge for Scottish Enterprise and for the Scottish Office will be to use this enhanced role to meet the needs of business in Scotland in the 1990s.

A radical feature of our proposals is the creation of a comprehensive network of employer-led local agencies. Such local agencies will offer a one-door approach to employers and the wider community and will enable provision to be more closely attuned to the needs of the local labour market. They will allow local employers and others a much greater say in the delivery of services in their areas for training and enterprise creation. The opportunity is there to forge strong partnerships at local level and to provide a powerful focus for effecting local change. Local agency functions will include analysing the local labour market, developing training plans, subcontracting training work and monitoring performance, encouraging employers to increase their investment in training and providing business advice and support. Local agencies will, therefore, be responsible for the delivery of training tailored to meet local needs while operating within the framework of national policy.

Once local agencies have gained in strength and confidence, and shown themselves capable of taking on wider responsibilities, certain functions at present carried out by the Scottish Development Agency may be devolved to them. There are attractions in delegating as much authority as possible to the local level. However, in certain of its areas of operation, a national remit and powers have proved a major strength of the agency. A balance will have to be struck between local and central powers which enables the retention of present strengths as well as the desired improvement of local delivery. The Government have not yet come to a conclusion as to where this balance should lie and would welcome the views of all those concerned. To set up the local agencies proposed, the Government will issue a prospectus inviting local employers to come forward with others from the community, such as people from enterprise trusts, colleges, training providers, trade unions, local authorities and voluntary organisations, to form the board of management in each area. We would expect two thirds or more of the membership to come from the senior ranks of private sector business. The Government are committed to giving the employers who will lead local agencies real

responsibilities and the power to take the main decisions within a framework that ensures

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public accountability. We are confident that within each community there are local employers and others who can rise to this exciting new challenge.

I am aware that these proposals will touch directly the lives of many people in Scotland : trainees, trainers, those already involved in enterprise support and, of course, the staff of the two bodies that are to merge. The success of Scottish Enterprise and of the local agencies will depend greatly upon the quality of their staff. For that reason, the Government believe that many of the staff in both the SDA and the Training Agency will choose to continue their present work with either Scottish Enterprise or the local agencies. I should now like to draw attention to the position in the highlands and islands. We have in mind that the same principles outlined for Scottish Enterprise and the local agencies should apply there. Local employers should be given the opportunity to take a similar role as elsewhere. Of course, the geographical and economic characteristics of the north and west are different and we recognise the distinctive value of the contribution made by the Highlands and Islands Development Board to the regeneration of its area. We take the view that future arrangements must build on success to date. This points to the retention of a distinctive body for the highlands and islands and we put forward three options : to set up a new body, Highland Enterprise, incorporating the HIDB's functions together with responsibility for training ; to retain the HIDB as it is and invite Scottish Enterprise to set up local agencies for training services in the highlands and islands ; or to invite the HIDB to act as a local agency with Scottish Enterprise for training provision. We look forward to hearing the views of those who live and work in the highlands and islands on these options.

In conclusion, I take pride both in pointing to the achievements of the past and in presenting a White Paper which opens up challenging new vistas for the future. In so doing, I pay tribute to the contribution of Bill Hughes of the Scottish CBI who has stimulated public interest and debate in these ideas. I have been delighted by the widespread interest and enthusiasm for these proposals already obvious in public and private comment over recent weeks. It is clear that the people of Scotland are attracted to the new opportunities offered by this approach to training and enterprise creation. Important new responsibilities are proposed for the Scottish Office, for the staff of the Scottish Development Agency and for those involved in training, and especially for the Scottish business and industrial community.

We have not sought to answer all the questions at this stage. There will now follow a full consultation period until the end of March. I hope that everyone concerned with training and enterprise in Scotland will take the trouble to comment on these proposals so that together we can produce the best possible Scottish solution to Scottish needs.

Mr. Donald Dewar (Glasgow, Garscadden) : I cannot remember any announcement that has been so well trailed and heralded. When we received it, the statement had been well decorated with public relations copy, including a fetching picture of a well-known Glasgow public house. The Secretary of State has done well in the cliche business in the past few minutes. There was one really purple

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passage at the beginning, which says something for the right hon. and learned Gentleman's courage, or at least for his brass neck. However, it is not clear how much substance there is behind the style. I suspect that those who were alarmed by the advance publicity will be at least temporarily relieved and that those who wanted a real attack on the problems of industrial training will be bitterly disappointed.

I shall start with the positive, because there is a positive side. I agree with the Secretary of State and welcome the need for a Scottish dimension to training. There should be a means of tailoring schemes to our needs in Scotland. I welcome the transfer of responsibility to the Scottish Office, although I note that the Department of Employment will still call the shots on national schemes. Will the Secretary of State note that one test for the new organisation when it is in being will be its ability, working with the Scottish Office, to influence the development of employment training and new training schemes?

There is an assumption in the White Paper that training is done for, not by, industry. There is no attack on the sad failure of industry in this country, which has left us trailing so far behind our principal competitors. At some point the Government must think seriously about the responsibility of industry, not just in terms of seconding an occasional executive to a local agency, but of tackling training in its own plants and factories with determination and the necessary resources.

The Secretary of State said that local agencies will be employer-led. We will expect them to represent the community generally. There must be a partnership, and few of us are convinced that there is an army of bright business men ready to enrol. In any event, whatever contribution employers may make to the new structure, they cannot have exclusive jurisdiction. The trade unions and local education authorities must have their place--not just a nod in passing.

There was also an assumption in the White Paper that the new structure will be funded simply by aggregating the existing budgets of the Scottish Development Agency and the Training Agency in Scotland. I take it from that that there is to be no new money to back the new proposals. The Secretary of State must accept that adequate funding is essential if the quality is to be established and maintained. Our European competitors do that and do it well. Why should we not do the same? The Secretary of State talks about the challenge of 1992, but there will simply be window dressing if the investment is not made.

Training will obviously impact heavily on the Scottish Development Agency. Many of us feel that the case for combining the SDA and the Training Agency is not proven. Does the Secretary of State recall that the Opposition set down a number of tests which should be met? I should like to ask the Secretary of State a number of specific questions. Will Locate in Scotland be affected in any way by the new arrangements? Will the ability of the Scottish Development Agency to stimulate investment, back growth and provide risk capital be in any way inhibited? Will the agency be able to mount local task forces and initiatives, linking with local authorities and the community, such as we have seen in Dundee, GEAR, Greenock and the Garnock valley? What happens to the Scottish Development Agency's decentralised structure? Will it continue, given that the agency's functions appear to be largely unaffected, at least at this stage? Does the

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Secretary of State accept that we shall want to look closely at the impact of any transfer of function to local bodies, which may be proposed at some future date? Finally, will the Secretary of State give an assurance that, whatever option is selected, the Highlands and Islands Development Board will be in a position to carry on with its distinctive and valued work?

The Secretary of State made a lengthy statement, full of complex hints and suggestions. Inevitably there are worries about the loss of the SDA name--a trade mark built on years of well-tried success. The House is entitled to ask the Secretary of State why we should fall into line with the copywriters of his noble Friend Lord Young at the Department of Trade and Industry and why we should accept that sort of Thatcherian rhetoric in Scotland? I should have thought that the name Scottish Development Agency might have been preserved, even if the restructuring was to go ahead.

We are entitled to look closely at what we are getting in return. It may simply be a minor reform of the training structure--perhaps more of a lost opportunity than anything else. Does the Secretary of State accept that, despite its title, his White Paper says nothing about enterprise creation and says less on training than had been promised? The Secretary of State described his scheme as "a quantum leap". Whatever it is, it is certainly not that.

Mr. Rifkind : I thank the hon. Gentleman for at least a good proportion of his response, which has consisted of some perfectly relevant questions that I shall now seek to answer. I thank him especially for his welcome of the proposal in the White Paper that there should be a Scottish dimension to training and that responsibility for training in Scotland should become part of the responsibilities of the Scottish Office.

The hon. Gentleman made one point with which I entirely agree--that training should ultimately be the responsibility of industry itself, and that Scottish industry, and industry in the United Kingdom as a whole, has been sadly reluctant to acknowledge its responsibilities in that sphere to the extent that is found in other countries in Western Europe. It is enormously encouraging that many of the ideas in the White Paper have come from Scottish industry and the chairman of the Scottish CBI, and that those representing industry in Scotland have already stated publicly that they welcome the idea of industry being expected to take more responsibility for the provision of training. That suggests that in Scotland industry is well aware of the relevance of the points raised by the hon. Gentleman, and that points the right road forward.

The hon. Gentleman asked about the composition of the local agencies and whether local authorities would have a role to play. He will see from the White Paper that that point is specifically covered. It states that, of course, local authorities as employers may have a contribution to make in their locality and that there is nothing to stop them and other bodies from coming forward, together with the private sector, and putting forward proposals for the creation of local agencies.

The hon. Gentleman asked about funding. He will agree that the funding of Scottish Enterprise, which is to be about £500 million, is not exactly small beer. It is an enormous sum, of which £350 million represents what is currently being spent on training in Scotland. That

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illustrates the seriousness with which the Government have approached the needs of training in Scotland over the past few years.

The hon. Gentleman asked specifically about Locate in Scotland. I can give him a categoric assurance that the work of Locate in Scotland will not be affected by any of the proposals in the White Paper. Locate in Scotland is concerned with inward investment, and its role and the way in which it operates will not be in any way diminished, damaged or affected by the proposals.

The hon. Gentleman asked whether the decentralised structure that the Scottish Development Agency has introduced in the past 18 months will be affected by the proposals. It is unlikely that it will be, but that will be a matter for the agency to decide in the next few months. The agency has chosen to decentralise its responsibilities to a more local level, and that has been widely welcomed. As the hon. Gentleman recognised, there is nothing in the proposal that need interfere with that process unless the agency itself were determined, for some reason, to choose otherwise.

In both the statement and the White Paper, I specifically acknowledged the hon. Gentleman's point about the Highland and Islands Development Board. I shall simply add that the principle behind the proposals is to encourage local diversity with regard to the provision of training. There is no reason why training in Dundee should be identical to training in Aberdeen or in Glasgow, because in many respects it is important to identify the needs of local economies within the national framework so that local training can be tailored to those requirements.

If that is true of individual localities in the central belt, the same principle clearly has to apply when considering proposals for the highlands and islands which have an economic framework and sparsity of population which is peculiar within the United Kingdom, never mind within Scotland. From that it follows that, although the same principles might be relevant in the highlands and islands, we are as anxious as the hon. Gentleman to ensure that the community in that part of Scotland should make its own contribution to identifying the way in which these principles can best be adapted to the economic circumstances of that part of Scotland.

Sir Hector Monro (Dumfries) : Does my right hon. and learned Friend agree that, in the context of a fall in unemployment of 70,000 in Scotland in the past two years, that will provide a tremendous opportunity for youngsters and people of all ages to take a leap forward in training and skills and that it will accelerate the opportunity to provide more jobs in Scotland?

In the context of devolving Scottish Enterprise to the regions, will my right hon. and learned Friend say a little more about the integration of the enterprise trusts, the Scottish Development Agency regional offices, the Training Agency and the regional councils' economic development and planning committees? Are they to work together to provide more jobs, bearing in mind that in doing so they will need largely increased financial resources?

Mr. Rifkind : Of course I pay tribute to the work of the enterprise trusts. When I visited my hon. Friend's constituency and met members of his local enterprise trust in Dumfries, they said that they were very excited about the ideas that were then being discussed in the press--ideas

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of a kind similar to those that I have set out today. I have no doubt that the success of the enterprise trust movement throughout Scotland illustrates that large numbers of people who are actively involved in industry are both willing and enthusiastic about making their contribution to the economic development of their localities. This proposal will provide them with an opportunity to have not merely an advisory role but a role in the execution and implementation of training in their localities. That can only benefit the local economy.

Mrs. Ray Michie (Argyll and Bute) : Does the Secretary of State accept that training that is employer-led--presumably by many friends of the Government--does not mix well with the development role of the Scottish Development Agency? Scotland will be worried to hear that the Scottish Development Agency's name and reputation, which have been built up over the years, are to disappear overnight. Will the Secretary of State also make a commitment that the Highlands and Islands Development Board will remain master in its own area and will not lose its social commitment to the people of that area?

Mr. Rifkind : On the first part of the hon. Lady's question, I think that she might not have properly understood the proposals. I suggest that she ought to read the White Paper before suggesting that employer-led local agencies do not mix well with the development role of the Scottish Development Agency. Over the last few years, the SDA has made it clear that it sees the encouragement and development of local, employer-led initiatives in the localities within the various parts of Scotland as crucial to its objective ; otherwise, it will be wasting its time. I am quite sure that that is its view now. We recognise that there is a continuing need for a distinctive body, such as the Highlands and Islands Development Board, to serve the needs of the highlands and islands. When the hon. Lady has had an opportunity to read that part of the White Paper which deals with the matter, I think she will acknowledge that that requirement and that concern have been fully met.

Mr. Bill Walker (Tayside, North) : Is my right hon. and learned Friend aware that many people in Scotland will welcome the statement? Those who have been involved in training and in the running of businesses will regard it as the first sensible approach that there has been for a long time towards meeting the needs of industry. The divorce of training from the development of an industry has meant that bureaucratic machines have been dealing with two interrelated activities that were dependent on each other. The proposal will remove that problem, and it is to be welcomed.

During the consultations on the future role of training in the Highlands and Islands Development Board area, will he bear in mind that a large part of the Scottish highlands is not included in the HIDB area? Those who live south of the Drumochter pass in my constituency will expect training activities, incentives and management to be the same on both sides of the Drumochter pass.

Mr. Rifkind : On the latter part of my hon. Friend's question, we have said that the same principles should apply. We shall examine whether it will be possible, in the

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much more sparsely populated areas of north and west Scotland, to have the same structure of local agencies as might be appropriate either in the central belt of Scotland or even in constituencies, such as that of my hon. Friend, which, compared with parts of Sutherland or Inverness-shire, are more populated. Moreover, the structure of their local business communities is much more substantial. We hope that the same principles will apply. We shall seek the views of those who live in the highlands and islands about how best these principles can be adapted to their circumstances.

Mr. Ernie Ross (Dundee, West) : The Secretary of State pays tribute in the statement to Bill Hughes for his initiative, but the right hon. and learned Gentleman knows that the original idea came from the private industry councils in the United States, where the main thrust of private industry councils is training. As my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) said, we welcome the determination to bring training back into the Scottish forum. In his statement the Secretary of State refers to a "one-door approach." He must know that the Dundee project is a one-door approach. I remind the House that that project was started by a Tory-controlled regional council, a Labour-controlled district council and the Scottish Development Agency. It is one of the best examples of how industry can be encouraged to come into an area. Will the Secretary of State assure us that the one-door approach of the Dundee project will not be lost in this initiative?

Mr. Rifkind : I can give the hon. Gentleman that assurance. I envisage that Scottish Enterprise will be directly involved in matters of national Scottish significance and that it may also be directly involved at its headquarters with projects which, although they may have only a local, geographical remit, may be of such significance to the overall Scottish economy as to justify that degree of involvement. Proposals about decentralising the functions of the SDA will continue with Scottish Enterprise unless and until it is demonstrated that they could be more sensibly dealt with at purely local level. We want to examine the best ways of delivering locally those services that can benefit the local economy. However, important projects will continue to have the same opportunities as they have now.

Mr. Alex Salmond (Banff and Buchan) : Does the Secretary of State understand the concern that, under the guise of the welcome devolution of Training Agency functions to Scotland, we may be seeing the filleting of the Scottish Development Agency and perhaps of the Highlands and Islands Development Board? What core functions and how many jobs does the Secretary of State expect will be held at the centre of what succeeds the SDA and even, perhaps, the HIDB? Will the Secretary of State either confirm or deny that recruitment for the membership of local agencies is already under way? If not, what status does Sir Hector Laing's letter to enterprise boards, looking for likely candidates, have? Does he understand that there is a great deal of concern that the professionalism of the SDA and of the HIDB may be replaced by the patronage of the Conservative party?

Mr. Rifkind : On the hon. Gentleman's latter point, I have not seen any such letter, nor was I aware of the

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possible existence of such a letter until I saw a newspaper report which, in every other respect, was inaccurate and which, for all I know, may have been inaccurate in that respect as well. Sir Hector Laing is involved with Scotbic, which has been involved with an enterprise trust. I suggest that the hon. Gentleman ought to address that question to Scotbic and find out what letters may or may not have been sent. I have no idea whether such a letter exists. I have not seen such a letter. The only knowledge that I have as to whether such a letter might exist is certain newspaper reports, which I presume are the source of the hon. Gentleman's information. Scotbic is not part of the Scottish Office. If it wishes to send letters, that is entirely a matter for Scotbic. No doubt it can provide the hon. Gentleman with the information that he seeks.

As for the staff who now work for the Scottish Development Agency and the Highlands and Islands Development Board at their headquarters, the hon. Gentleman will be aware that over the last year or so the number of staff has been reduced--in the case of the SDA, because it decided to decentralise some of its functions to its regional offices in various parts of Scotland. I do not envisage any of the proposals in the White Paper as likely to have a direct effect on the number of staff employed in the headquarters of the Scottish Development Agency.

Mr. Tony Favell (Stockport) : Does my right hon. and learned Friend agree that the spirit of enterprise comes from within and that it is difficult to impose it from without? For that reason, may I urge my right hon. and learned Friend to make the local agencies independent? Four years ago in Stockport the president of the chamber of commerce, a Scotsman, Ernest Petrie, started our local enterprise agency. Since then, there has been a burst of activity in Stockport and jobs and self-employment have been created. There has been no grant and no development agency, and unemployment is now less than 6 per cent. If there are 10 Scotsmen half as good as Mr. Petrie still in Scotland, that country has a great future.

Mr. Rifkind : I thank my hon. Friend, and, in answering his remarks, I shall also deal with the point raised by the hon. Member for Banff and Buchan (Mr. Salmond) who talked about patronage. Contrary to certain press reports, the Secretary of State for Scotland will not appoint either the chairmen or the members of the local agencies. They will come fron the local community. As I understand it, that is how they operate in my hon. Friend's constituency.

Mr. Dick Douglas (Dunfermline, West) : Will the Secretary of State reflect a little? In a way we are all indebted to Bill Hughes for launching this venture. Those of us who have had discussions with Mr. Hughes recognise that his views were extremely embryonic. However, the responsibility for the White Paper lies with the Secretary of State alone. Will he reflect on the fact that one of the difficulties of employer- dominated training is that employers tend to train for jobs as they are, not jobs as they are likely to be? For example, if we had had employer- dominated training in Clydeside, we might still be training riveters if there were ships to build, and in Dundee we might still be training jute workers. The relationship between training, education and the future development of industry must be discussed, and there is little in the White Paper about that. Does the Secretary of State accept that it is extremely difficult to reconcile the two roles of initiating new

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ventures and training? Those two matters are not as co-related as they appear to be in the White Paper. Will the Secretary of State address that issue ; and does he accept that, although we welcome the devolution element, we are anxious to see more money and effort put into it?

Mr. Rifkind : I understand the hon. Gentleman's point. He said that he did not believe that training should be left to employers. However, he will recall that his hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) said that industry should accept responsibility for providing training for its employees. That view is certainly shared throughout Western Europe. We acknowledge that training must be provided, and we believe that a partnership of the type proposed is the best way to do it. In addition, we envisage local agencies preparing economic profiles of their localities showing the likely skill shortages over the next few years and identifying--at a time when demographic changes will lead to fewer youngsters being available for employment--the type of training necessary to ensure that the youngsters and other local people get the jobs available and that local industry obtains the people with the necessary skills.

For example, it is worrying that, with continuing high unemployment, a recent survey by the Scottish CBI identified that 15 per cent. of its members report skill shortages and an inability to recruit those with the necessary skills. That problem must be eliminated. Several Hon. Members rose--

Mr. Speaker : Order. I shall endeavour to call all those hon. Members who are rising, but will they please ask briefer questions because that leads to briefer answers?

Mr. Alexander Eadie (Midlothian) : The right hon. and learned Gentleman must be aware that nobody could quarrel with some of the language in the White Paper--for example, where it says that we should be prepared for the future, where it refers to "Scottishness," and so on, and, on page 27, where it says that the document is for discussion by the general populace in Scotland. Does the right hon. and learned Gentleman agree that it would be a good idea to help to retain the industry that already exists in Scotland? Is he aware that for the first time in a hundred years the Scottish coal mining industry is depleted and that all the planning, engineering and service industries will be dealt with south of the border? We have lost the Scottish coal mining industry as an indigenous industry for the first time in a hundred years. Will the Secretary of State look into that?

Mr. Rifkind : I am delighted that the hon. Gentleman was unable to find anything with which to quarrel in the White Paper, because on other occasions he has not found that too difficult. It is true that the deep- mined coal sector has been going through a difficult time. However, I am sure that the hon. Gentleman will acknowledge that there has been more growth in opencast mining in Scotland than in any other part of the United Kingdom and that it is now responsible for half the coal produced north of the border. Therefore, even within the coal industry, which has difficulties and problems, there have been areas of significant growth.

Mr. Adam Ingram (East Kilbride) : Only a few weeks ago the Secretary of State issued a consultative document on the future of Scotland's new towns. Does not today's

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statement prejudge the efforts that have been made in looking for suitable alternatives to replace the new towns as job attraction agencies?

Mr. Rifkind : I hope not. If the hon. Gentleman is concerned that it might, I should be delighted to hear the detailed reasons for his worry. I see nothing in the White Paper that is incompatible with the consultative document.

Mr. Dennis Canavan (Falkirk, West) : How can the Secretary of State expect us to believe his assurance that Scottish Enterprise will be broadly based in view of the blatant abuse of patronage powers by the Government to invent what looks like a job creation scheme for failed Scottish Tory Members of Parliament, such as Ancram, Fletcher, Anna McCurley, Peter Fraser and Uncle Tom Cobbleigh and all?

Mr. Rifkind : The hon. Gentleman finds it difficult to accept that appointments to important public positions in Scotland should go to those best qualified to occupy them.

Mr. Norman Hogg (Cumbernauld and Kilsyth) : Will the Secretary of State explain how the local agencies will relate to the enterprise trusts and the development corporations, to which my hon. Friend the Member for East Kilbride (Mr. Ingram) referred? It is important that that should be clarified.

Mr. Rifkind : The hon. Gentleman has raised important questions. Clearly, the enterprise trusts have been successful in attracting a significant number of people in local industry to serve in the local community and identify opportunities for economic growth and development. I am sure that many of those people would wish to serve on the local agencies. It might be that some of the enterprise trusts would put themselves forward as possible local agencies. We would like to explore those ideas with people who have experience in those matters.

As regards new towns, the responsibility for training has until now been the responsibility of the Training Commission--now the Training Agency--on a national basis. Clearly, if training is now to be delivered locally in the way we have suggested, there is no reason why that could not apply equally in the new towns. I accept that the new towns are in a special position and, as I said to the hon. Member for East Kilbride (Mr. Ingram), I shall be happy to hear the hon. Gentleman's views on any particular problems of which we should be aware.

Mr. John Home Robertson (East Lothian) : Will the Secretary of State, for once, acknowledge the excellent work being done by local authorities in many parts of Scotland, including my constituency, in promoting industry and enterprise in their areas? I accept that the new training agencies may need to be slightly more broadly based than the local district council areas in Scotland now, but does he accept that the suggestion that Edinburgh and East Lothian should be regarded as a local area for enterprise creation in the future may not be greeted enthusiastically in my constituency?

Mr. Rifkind : Those who draft the boundaries for the local agencies will be happy to hear the hon. Gentleman's views. I am happy to acknowledge the contribution of local authorities. Indeed, it is referred to in the White Paper, which says :

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"it is encouraging that many local authorities are already increasingly choosing to work in partnership with private sector interests to generate local economic development."

Mr. James Wallace (Orkney and Shetland) : As well as training duties, the Secretary of State has said that he sees local agencies as having a role in providing a local economic audit or profile. How does he see the local area agencies, particularly in areas such as mine, being resourced for an administrative purpose.

Mr. Rifkind : We anticipate that the bulk of their funds--in some cases a high proportion of funds--will come from Scottish Enterprise. The local agency will present to Scottish Enterprise its proposals on the needs and training requirements of the local economy. If Scottish Enterprise were satisfied that the local agency consisted of people who were fit and proper to be responsible for the implementation of training policy and that they had sensible proposals which would involve the proper use of public funds, Scottish Enterprise would enter into a contractual relationship with the local agency for the delivery of the services.

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