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Mr. Deputy Speaker (Mr. Harold Walker) : Order. Interventions should be brief.

Mr. Arbuthnot : Hon. Members on both sides of the House have recognised the need for a far greater emphasis on training than in the past. I am not clear whether the

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hon. Gentleman believes that only the Government should be responsible for training or that industry should place more emphasis on training. In 1978-79 about two thirds of the money that went into the Scottish Development Agency came from the Government and the other third came from business and the economy that it produced. In view of the wide support for the changes that are being introduced in the Bill, in view of the support of the Churches, the trade unions, the SDA and the vast majority of the 420

representations that have been received, it is more surprising that the party, or parties opposite--I have now heard the Liberal party's view--have set their faces so firmly against it and, as my right hon. and learned Friend the Secretary of State said, have stood in splendid isolation in opposing the Bill.

Mrs. Fyfe : Is the hon. Gentleman aware that the Scottish TUC is so concerned about the plans for training in Scotland that it has proposed setting up an independent body to monitor the carrying out of that training because it cannot trust the Government to do that properly?

Mr. Arbuthnot : The STUC has generally welcomed the Bill. Obviously, it disagrees on some issues, as do many others who have produced representations generally in support of the Bill. But the broad feeling in Scotland is that the Bill and the White Paper are along the right lines. The Labour party is sadly isolated if it says that the principle of the Bill is flawed. But is the Labour party saying that? Do Labour Back Benchers agree with the suggestion of the hon. Member for Glasgow, Garscadden (Mr. Dewar) that the Bill should be opposed? When my right hon. and learned Friend asked whether it was the detail rather than the broad principle of the Bill that was objected to, the hon. Member for Fife, Central (Mr. McLeish) nodded his head. In that case, he and his colleagues should examine their conscience, support the Bill on Second Reading and propose detailed amendments in Committee. If they do not do that, they will risk being accused of petty opposition for the sake of it, and rightly so. They also risk being trampled in the rush of local authorities and local trade unions eager to take part in the local enterprise companies. They are putting forward applications to take part. If the Labour party is not to be trampled in that rush, it should consider changing its stance. The local trade unions and local authorities are eager to endorse the principle of this excellent Bill.

8.5 pm

Mr. Adam Ingram (East Kilbride) : I do not intend to comment in detail on part I of the Bill which deals with Scottish Enterprise, but I fully endorse the points made in relation to that by my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar). I represent the first Scottish new town and I have lived in East Kilbride for the past 20 years. Therefore, I want to confine my remarks principally to part II, which deals with the winding up and dissolution of the new town development corporations.

The residents of the new towns expected and deserved something better than an imprecise three-clause addition to another piece of legislation, sneaked out in an unacceptable way over the Christmas and new year holiday period. The way in which that was done, and the lack of detail contained within the measure relating to the new towns, treats the 25,000 people who live in the new towns with nothing short of contempt.

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The Secretary of State and the Minister with responsibility for the new towns appear to forget that Scottish new towns are places where people are born, brought up, and educated and in which they live and work. They are total communities in which one in 20 of the Scottish people live and work.

Why have we not been presented with a proper piece of legislation which takes account of the ongoing housing needs of the new towns? Why have we not been presented with a Bill which takes account of the benefits gained by having the overall community environment planned and run by bodies with a degree of democratic accountability? Why have we not had a piece of legislation which recognises the economic benefits to be gained from having a democratically accountable body responsible for the economic development of the new town areas? Why should five new towns find themselves being privatised and run differently from every other town, city or community in Britain? Two key areas give major cause for concern--housing and economic development. The future of new town tenants and those who would have expected to be housed by the new town development corporations in the future remains decidely uncertain. The real fears and worries of tenants will be increased by what the Bill does not say as by what it does say.

As other hon. Members have said, in the past year the Government have commissioned an independent survey on the attitudes of new town residents to housing choice within the new towns. It makes salutary reading. I shall not go into that in detail, but I want to take one prime aspect. In reply to one question, two thirds of tenants said that the district council would be their preferred landlord on wind up. Only 8 per cent. said that they would choose a housing association, 9 per cent. a housing co-operative, 5 per cent. Scottish Homes and 1 per cent. a development corporation buy-out. No one said that they would choose a private landlord. That is a clear expression of tenant choice--something that the Government claim is their overriding and highest priority.

If the Government are so committed to tenant choice, why does not the Bill contain a simple clause stating that at any time prior to or during the winding up process tenants' wishes will be respected and that they will be able freely to choose their own landlord? One simple clause would put at ease the worries of all tenants living in development corporation houses. I suspect that such a clause was not inserted because the Secretary of State and the Minister knew that tenants would choose their district councils and did not want to offer them that choice.

At present, development corporations in East Kilbride, Glenrothes and Livingston are planning to transfer their housing stocks to private management agencies, and they have not asked tenants for their views on that development. Recently I tabled a parliamentary question asking the Minister whether he would be prepared to advise or instruct development corporations to consult tenants prior to any transfer to management agencies of new town housing stock. His simple and stark answer was no. Tenants are being given little choice, and the management structure is being transferred over their heads. We are left with a public housing authority that takes no account of tenants' wishes, and a Secretary of State and Minister who are not prepared to defend tenants' interests. When the Bill is enacted, I envisage the Secretary of State

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establishing in each new town an office on whose door will be the sign "Tenants' choice--no inquiries please." Even the people of Romania are not prepared to put up with that kind of thing any more. What is happening even before the Bill is on the statute book will occur to an even greater and more dramatic extent when it is law. Tenants will have the choice only of accepting what the Government say is right for them--and if they do not like it, they can get out. I refer to people who have lived for years and decades in new towns, and who have brought up their families there and are now seeing their children marry and bringing up their own children.

The Bill is silent on which body will be responsible for new towns' ongoing housing needs. Existing new build programmes are inadequate to meet the current requirements of new town areas. The situation has deteriorated steadily over the years and seems likely to become an even greater problem in the years ahead. Figures from Shelter reveal an alarming increase in the number of homeless and the extent of waiting list problems in new town areas. In my own new town of East Kilbride, the number of homeless doubled in the seven years between 1981 and 1988--increasing from just over 2,000 to more than 4,000--as a consequence of Government policies. No one else can give development corporations the authority to build new houses. Such instructions have not been forthcoming in recent years, even with the lifting of the moratorium after considerable pressure was placed on the Scottish Office by Scottish local authorities and tenant representatives. The Bill makes no provision either for local authorities to fulfil their statutory obligations to the homeless and to other special needs groups. The proper solution would be to provide for a transfer of the relevant special needs housing stock to district councils. That would set to rest the worries and fears of those already living in special needs housing and the many on the waiting lists for such accommodation--as well as of the many thousands of homeless in new towns who are searching for a home within the community but cannot obtain one because of circumstances outwith their control. There is no mention in the Bill of the way in which the relative success of new towns in recent years will be maintained. Other hon. Members have mentioned that in recent years 40 per cent. or more of inward investment in Scotland has gone to new town areas. That success is built on long-term planning, investing for the future, and the careful use of public assets in developing new town areas. Those assets have been developed at considerable public expense and managed successfully over the years through a form of democratic accountability in partnership, to a greater or lesser extent, with local authorities. That formula for success and the experience that has been built up will now be cast aside.

Although the Bill says nothing about the successors to the development corporations, the White Paper does. It makes it clear that the successor bodies will be run on a private sector basis and will be profit driven. Instead of the existing bodies dedicated to long-term development, there will be groups of entrepreneurs with an eye on the main chance and a fast buck who will be more dedicated to getting what they can out of new towns-- probably by asset stripping--than to what they can put into them. Now

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is the wrong time--with increasing competition for inward investment not just within Britain but across Europe, and for economic development--for the Government to throw away the major business expertise that exists within new towns and to dispose of well integrated, developed and properly planned industrial and commercial assets to the highest bidder. Even then there is doubt as to whether they will go to the highest bidder.

The Bill's failure to provide for local authority involvement in the successor bodies also gives cause for concern. Local authorities will have a role, albeit minimal, in Scottish Enterprise and in local enterprise companies, but they will be denied a similar involvement in local development boards. Why should that be so? Why should local authorities or democratically elected councillors be denied a place on the local enterprise boards, when there is acceptance that at least some form of local authority representation should be permitted in respect of local enterprise companies? In the case of East Kilbride and Glenrothes, there is a fear that the development corporations will be wound up before Scottish Enterprise is up and running and has a chance to establish itself. To subject new towns to a changing and uncertain environment could prove disastrous not just for their areas and their wider communities but for the whole of the Scottish economic scene.

Everyone associated with new towns takes pride in the housing, social, industrial and commercial environment that they provide. Those of us who live in new towns are proud to do so, but nothing in clauses 30, 31 and 32 gives cause for hope in their future. Those three clauses are analogous to the three-card trick, but instead of it being a case of finding the lady, it is a matter of finding the Government's commitment to democratic accountability and freedom of choice. We all know what happens to the lady in the three-card trick : it is shown briefly and then palmed by the con man.

Fortunately, the people of the new towns will not be conned by the Secretary of State. They know that they will not have even a chance of glimpsing freedom of choice in respect of housing or democratic control over their communities' commercial and industrial assets. That is why the people of the new towns strongly oppose the Bill and why I, as a new town Member of Parliament, give them my full support.

8.18 pm

Mr. Alex Salmond (Banff and Buchan) : The debate had an unusual start, when the speech of the Secretary of State for Scotland was disrupted by the hon. Member for Tayside, North (Mr. Walker). I was glad that the hon. Member for Tayside, North did not get shown the red card--not so much because we would have missed his speech later but because, rather embarrassingly, I would have been constrained for the first time to support Mr. Speaker's ruling on such a matter. The right hon. Member for Ayr (Mr. Younger), making one of his first speeches as a Back Bencher on a Scottish subject, paid a handsome tribute to the work of the Scottish Development Agency, the Highlands and Islands Development Board, and new town development corporations. His tribute was so handsome that I wonder why he so enthusiastically supports legislation that abolishes those institutions. That is an important point. Opposition Members are entitled to be certain, before we

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endorse or support the legislation, that what replaces those institutions will be more effective than the SDA, the HIDB and the new towns have been. Criticisms along those lines are not carping and minor but substantial and major.

There is no doubt that the legislation has been oversold and that occurred from its genesis when the progenitor of the scheme, Mr. Bill Hughes, the vice-chairman of the Conservative party in Scotland, boasted that it would eliminate Scottish unemployment within a matter of years. If claims of that sort were to be brought to fulfilment, there would have to be something in the scheme--either in its finance, its function or its performance--that would allow such extravagant claims a semblance of reality. If we consider the issues in turn we will find nothing in the legislation that could meet such an ambitious target.

As other right hon. and hon. Members have pointed out, no new money is being made available for investment work or training in Scotland. The best that can be said is that finance under the legislation will be broadly equivalent to what is available at present. There is a real danger that a diminution of finance is on the agenda. One might reasonably expect that private employers taking a larger funding role in training in the future is part and parcel of the Government's logic of privatisation of the training services.

Opposition Members are entitled therefore to ask for guarantees that the hints of an expanded budget that the Secretary of State for Scotland was prepared to give in a television programme will be transformed into legislation. Perhaps, when the Minister replies, he will tell us what will happen to the funding pattern of the SDA, the HIDB and training under the Scottish Enterprise proposal. Nor is there any great change in the functions that will be undertaken by the new system. The Secretary of State has made great play of the devolution of the training services to the new Scottish Enterprise organisation. As other hon. Members have said, when one analyses those training services, one sees that 95 per cent. of the funding will remain dominated by programmes determined by the United Kingdom Department of Employment. All the Secretary of State had to say when he was questioned about whether that represents a "Scottish solution to Scottish needs" was that it would be a problem if Scottish qualifications were different from those in England. Does that not also apply to the present Scottish education system? There does not seem to be any problem with Scottish labour mobility into England--just the opposite. The key priority is that training qualifications should be appropriate to the needs of the economy in which they function.

If the scheme was a genuine Scottish solution to Scottish needs there would not be a superficial devolution of training programmes but the right to evolve training programmes that are appropriate to Scottish conditions.

When we consider the likely performance of the new agencies, we are entitled to ask why the new set-up will be better than the old one. For example, the Scottish Development Agency has just undergone a major reorganisation and decentralisation of its functions. How will the investment function of Scottish Enterprise perform better than the SDA, with a similar decentralisation by area?

A number of hon. Members have criticised certain aspects of the SDA's performance in the past, but on the whole, and one can only judge these things in that way, it would probably be the virtually unanimous view of the

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House that the SDA has performed well under the circumstances. Why should we expect the new organisation to perform its investment function better than the SDA or the HIDB did in the past? We already know that 95 per cent. of the training schemes will be United Kingdom dominated. The Government are placing their faith in the intervention and introduction of private sector employers into the organisation. They will dominate local enterprise schemes by a ratio of two thirds to one third. What is the training track record of that section of the Scottish community and why does it lead us to expect that their performance within Scottish Enterprise will be dramatically better than their performance within their own companies? The Government claim that they have a consensus on the proposals, but I do not see that one exists. There is certainly a consensus in favour of devolution of training to Scotland, but, as Hamish Morrison, chief executive of the Scottish Council has said, that is "more apparent than real."

There is a large measure of agreement that there should be integration of training and investment because they are closely interrelated. However, that should not mean that the existing institutions--the SDA and the HIDB-- should have to be dismantled. Why was it not possible to use the new area structure of the SDA as the basis for the new organisation, and, underneath that, along the model of the present local enterprise trusts, have agencies that would deliver local training needs from the training budget?

In my constituency the proposal from Banff and Buchan Enterprise made the important point that training needs are not likely to be identified best on a Grampian level. They are more likely to be identified in the same way that local enterprise trusts identify them at the moment--at a really localised level with detailed knowledge of the local economy. We could have kept the best aspects of the SDA and its structure as well as integrating the training requirements. Any agreement in principle that there may have been at one time about the proposals has been shattered by the total imbalance in the structure of the proposed organisation. There is a real danger and a suspicion that these proposals will mean the replacement of the professionalism of the SDA with the patronage of the Conservative party.

The Secretary of State for Scotland said that he does not appoint local enterprise companies. That is true. He appoints the committee that vets the local enterprise companies. He also appoints Scottish Enterprise, which monitors the performance of local enterprise companies. Therefore, there is a real danger that that is effectively an extension of Scottish Office patronage into an area which, in the past, was administered professionally.

The SDA and the HIDB are the latest in a list of Scottish institutions that have been attacked by a range of policies. Education local authorities and the Health Service have also been subject to reorganisation and restructuring, often for no good reason, at the hands of the Government.

We should consider why the two thirds bias towards the private sector is wrong. First, it is wrong because it fails to realise that local employers are in competition for scarce labour resources. Take the Grampian example. There will be a maximum of eight private sector local employers in the new Grampian Enterprise organisation. What about the many other private sector employers within the region?

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Will they not have any input into the organisation? Secondly, the scheme devalues the role of local authorities. They are not just major employers ; they are major providers of training services through local authority colleges. Again, in the Grampian example there is a maximum of four places available to non-private sector sources. Therefore, the odds must be against even one councillor from, say, Banff and Buchan becoming a member of the new organisation. The proposals belittle the legitimate training role of local authorities.

The third problem is the lack of effective trade union representation, particularly in training. There is a potential conflict of interests between employers, and between employer and employee. The union movement should be properly represented to ensure that people are confident that they are being trained to enhance their skills, and not because it suits one part of the private sector. There will be no consensus support for the Bill until the present proposals, which are biased in favour of the private sector, are replaced by proposals that provide for a genuine partnership between private sector, local authorities and trade unions. I agree with much of what was said about new towns by the hon. Member for Cumbernauld and Kilsyth (Mr. Hogg), although I cannot endorse his architectural attack on the Scottish National party. In view of his past comments on such matters, the hon. Gentleman probably did not give us the complete picture of Cumbernauld's architecture, and in any case I do not know a great deal about that subject.

One of the tenants who lobbied hon. Members today gave me a copy of a letter sent on behalf of the Minister of State in June 1988. The letter dealt with the position of new town tenants following the abolition of the new town corporations, and stated--as Ministers have stated before--that the Secretary of State

"will take full account of the views and wishes of the tenants concerned before reaching his decision."

Various surveys and expressions of opinion have made two things clear. First, in general the district council represents the most favoured landlord for new town tenants ; secondly, private sector landlords were the least popular choice--so unpopular, indeed, that they barely registered in the surveys. I feel that we are entitled to a definite statement that each new town tenant will at least be given the option of moving into district council tenure when the new town corporations are finally wound up.

Significantly, the former Secretary of State, the right hon. Member for Ayr, did not seem to be aware of the amount of evasion, convoluted logic and survey-rubbishing in which the Minister of State has been engaged. The Minister's statements have led us all to suspect that district council tenure is the last option that he wants to offer, but we believe that the new town tenants should be given the freedom of choice that they were originally promised. I want to make two specific comments on the Scottish Enterprise legislation, followed by a more general point. First, have the Government considered the fact that European social fund applications are processed through the Department of Employment? Will that task be devolved to the Scottish Office, to the SDA or to Scottish Enterprise?

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Secondly, let me ask on behalf of my hon. Friend the Member for Moray (Mrs. Ewing) whether the Government have considered the anomalous position of her constituency and Moray district. At present, some 25 per cent. of population is in the Highlands and Islands Enterprise area, with about 75 per cent. in the Scottish Enterprise area. My hon. Friend argues that the whole of her constituency and district should be brought within the Highlands area, with the important proviso that funding should take account of the increase in population.

Finally, let me make my general point. There is no doubt that labour supply factors can be important to economic success, and over the next two or three years certain industries in Scotland are likely to face severe labour shortages in jobs that require key skills. Construction is an obvious example, because of the current oil boom. Economic structure and demand are also important, however. I wonder whether the Secretary of State or the Minister watched a BBC television programme last Friday in which a successful Scottish business man, Mr. David Murray, was asked for his views on the outlook for the next decade. Far from replying that he believed that the Scottish Enterprise proposals would lead to some great Scottish economic renaissance, Mr. Murray expressed regret about the erosion of indigenous ownership in the Scottish economy, and pointed to the damage done to Scotland's economic prospects by penal interest rates that are designed not for Scottish economic conditions, but for the overheated economy of the south-east of England.

Until we have a real economic policy that provides a genuine Scottish solution to Scottish needs, the Scottish Enterprise proposals will be at best irrelevant and at worst damaging. Several Hon. Members rose --

Mr. Deputy Speaker (Mr. Harold Walker) : Order. Four hon. Members have sat here for a long time trying to catch my eye. I understand that the Front-Bench Members wish to reply to the debate at 9.20 pm, which leaves 43 minutes. I hope that the arithmetic will not be lost on hon. Members.

8.37 pm

Sir Nicholas Fairbairn (Perth and Kinross) : I think that hon. Members on both sides of the House will agree that we have heard a rare speech from the hon. Member for Banff and Buchan (Mr. Salmond), a Scottish National Party Member. It was not constructive ; we would not expect it to be. It was not instructive either. What was rare about it was the fact that it was not even destructive, and I am sure that we all learnt very little from it.

I was impressed to note that the only titter that we have heard throughout the debate came from Labour Members when the hon. Member for East Kilbride (Mr. Ingram) said that even the Romanians would not stand for the Government's proposals. Let us not forget the principal new town housing policy of President Ceausescu : he bulldozed all the villages and forced people to live in Socialist new towns. I have just returned from a visit to the Socialist new towns of Warsaw, Witowice in Czechoslovakia and East Berlin, and I can understand why the Romanians would not want Socialist new towns. I was horrified by what was said by the hon. Member for Cunninghame, South (Mr. Lambie) about human beings

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who had had the effrontery to buy their own houses. His remark may well rank in the history of Socialism, along with "We are the masters now": he said that "we" had been left with only 4,000 houses. Who are "we"? Are not houses meant to belong to people? Why should we arrogantly assume that they wish a Socialist organisation, which has been left with only 4,000 houses, to be perpetuated?

Dr. Godman : There are only 4,000 left.

Sir Nicholas Fairbairn : There is only one in my constituency. Why does the hon. Gentleman say that only 4,000 are left? I pay tribute to him for his kindness and his compliment to me in allowing me to be a member of his committee, even though my peccadilloes were always put into shadow by his own.

The hon. Member for Dundee, West (Mr. Ross) made an interesting point when he asked us to give an example of a factory or industry that had not been destroyed in Scotland. He should be the last person to ask such a question. Ron Todd prevented the most important modern factory that Scotland could ever have had from coming to Dundee. The Opposition want bureaucracy to continue in its most strangling form. The successes which the Minister of State and my right hon. and learned Friend the Secretary of State have brought about for the Scottish Development Agency will be increased by the Bill. Enterprise companies in Perthshire and Fife are enthusiastic about the Bill, but they are frightened that the regional councils or the Socialist district councils will attempt to make the magnet of the city of Dundee do down the city of Perth. We want the enterprise companies to benefit small towns and villages in Scotland by developing tourism and trade.

The most essential element for future employment is training. I read the Dumfries Courier every day. It is the only newspaper that still carries advertisements on its front page, with the news in the middle. Each day there are probably two advertisements in the "Situations Wanted" column. There are probably 200 advertisements in the "Situations Vacant" column. At the other end of the newspaper there are sophisticated advertisements, usually between 50 and 100. The reason for that large number of vacancies is not because people do not want to work ; it is because we do not have trained people to do the work that is available. It is work that they would like to do.

People need to be trained and encouraged to be flexible so as to be able to adapt to changes in working practices. The development of skills is the most important manifestation of education in all its variety. The Bill combines training with what is, for Scotland, a unique benefit--one Government agency to which any person who wishes to invest in Scotland can go, knowing that everybody whom he will need to consult will be under the same roof. He will not have to visit different departments and different officials, as happens in England.

I was in New York last year where I helped to promote the Scottish trade exhibition. American business men told me that, apart from Scotland, there was no place in Europe to which they could go where they would meet under one roof all the people that they needed to see. If training is to be combined with the Scottish Development Agency, we shall be able to attract industry to Scotland. Industrialists will not then prefer to go to other European countries.

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8.45 pm

Mr. Ernie Ross (Dundee, West) : The hon. and learned Member for Perth and Kinross, (Sir N. Fairbairn) made a rather obscure reference to his hon. Friend the Member for Wanstead and Woodford (Mr. Arbuthnot). The hon. Member for Wanstead and Woodford publicly insulted the Scottish Development Agency by saying that in the past it had supported lame ducks. I invited him to name one of the lame ducks that the SDA had supported. We do not know what would have happened in the case mentioned by the hon. and learned Member for Perth and Kinross, because the SDA was not involved. It can hardly, therefore, be described as a lame duck ; it never even got there. However, I invite the Minister to give an example of one of the lame ducks that the SDA is supposed to have supported. I am not aware of any lame ducks. I am sure that the SDA would feel insulted if it thought that it was supporting lame ducks.

The Bill will lead to the axing of one organisation that has a good track record in Scotland. It was the envy of English Members of Parliament on the Employment Select Committee who toured Scotland with me last year and examined the work of the SDA and other agencies.

The SDA has been investigated regularly by the Treasury and the Industry Department for Scotland. According to the most recent investigation, published in February 1987, the SDA's

"high standing with the Scottish business community and financial institutions, the generally supportive attitudes of the local authorities and its reputation beyond Scotland are also indicative of the Agency's performance What the Agency primarily supplies is an integrated delivery mechanism At a time of continuing rapid structural change in the Scottish economy, there remains a real advantage in having a flexible economic development instrument directty answerable to the Secretary of State Conversely, the Agency's position at arm's length from the Government has contributed to its achievements, notably in its ability to form constructive partnerships with local authorities and to adopt a distinctive action-orientated and opportunistic style of operation."

According to a training organisation based in Sheffield, just under a quarter of all employers had a training plan in 1986-87. However, the SDA, which has taken positive initiatives in Scotland, is to be brought under the control of people who are training fewer than 50 per cent. of their employees. A clear case can be made for the SDA to be allowed to carry out its own distinctive role, according to the devolved form of management that the agency devised for itself last year.

A particular Scottish influence needs to be reflected in any training policy. The Secretary of State sought comfort in the support of the STUC, but he failed to tell the House that the STUC had said that if training in Scotland was to be taken seriously, it had to reflect the Scottish experience and not simply be dictated by the national policies decided by the Secretary of State for Employment. We know all about that in Scotland. Dundee was used for pilot projects for the many schemes which failed miserably. That is why the Government had to look outside Britain and to the United States for examples of how to organise training.

There have been various references to who was the author of this or that policy. According to the Scottish Office, when the Employment Select Committee was in Scotland in June 1988,

"The genesis of the White Paper resulted from a suggestion by Bill Hughes of the CBI (Scotland) about the benefit of bringing together the SDA and the training agency. This attracted the attention of the Prime Minister and"--

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--someone whom I cannot identify--

"was asked by the Secretary of State for Scotland to look at the suggestion. The Prime Minister explicitly adopted the proposal in a speech made to the CBI (Scotland) in September."

That is just a pile of nonsense. What really happened was that the former Secretary of State for Employment, the right hon. Member for Sutton Coldfield (Sir N. Fowler), visited the United States, doing the same tour as the Select Committee, saw private industry councils in America and picked up the idea of getting women back into employment by paying for child care. We are tired of hearing that the Government invented that idea as well, because we all know that it came directly from employment practices in the United States. Although I do not think that I shall be on the Standing Committee, I hope that it will examine the experience in the United States. The Committee will need to consider the successes and the failures. There are always successes such as Bill Hughes' brilliant idea, although when my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) led a delegation to meet Mr. Hughes, who is also a director of Grampian Holdings, we knew more about the training initiative than he did. It appeared that he had not been paying attention to Kay Stratton who had worked for Senator Dukakis in Boston and who had brought the idea over when she became a personal adviser to the former Secretary of State for Employment. Obviously he listened briefly to Kay Stratton and then had to be filled in later by the person who worked on the proposal so that the Prime Minister could make the speech to the CBI in Scotland in September.

Initially private industry in America sent minions instead of chief executives to private industry councils in America which took off only when the chief executives became involved. The United States became aware of the demographic time bomb and realised that they needed to get people back into employment. They needed the people whom the American system had failed--the blacks, the ethnic minorities and the women. That is why they began those projects. In the mid-1980s corporate conscience was developing in the United States. Corporate conscience meant that capitalists, instead of looking at the figures at the end of the year to ensure that a firm's accounts were in the black, were quite prepared for it to slip slightly into the red if it was spending money on training people and bringing them back into employment to ensure that the company would prosper in the years when there would be a gap in the work force because of the demographic time bomb and the flattening-out of the baby boom. I hope that the Standing Committee will look at the experience in the United States. There are good and bad examples, but, without some guarantee of a corporate conscience, some of the local enterprise companies will make the same mistakes that were made in the United States.

The private industry councils in the United States showed great concern for ethnic minorities and for those who had fallen through the safety net. When the Employment Select Committee went to Scotland, we examined the failure of employment training to deal with those young people who used to be called "mode B" youngsters on the YTS. They ended up on community programmes having to be employed by organisations such

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as Goodwill Enterprises. The Select Committee saw no real evidence that the young people who were disappearing from the community programmes like snow off a dyke on a summer's day were being picked up by other schemes. Given the employers' domination of local enterprise companies, they are hardly likely to be concerned with training people without the necessary basic skills. When the Minister replies to the debate, we need to hear that the Government are concerned and have particular proposals for dealing with that problem. The private industry councils in the United States had to concentrate on that if they were to be meaningful in the community. My hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman) referred to the role of the Scottish tourist board which gave evidence to the Employment Select Committee on 13 December 1989. When I asked Tom Band and his colleague what they had done to ensure that there would be sufficient representation from the tourist boards and the tourist industry in the local enterprise companies, he said that one or two people were involved in Scottish tourist board activities. However, the Highlands and Islands Development Board and the Scottish Industry Department's evidence to the Select Committee on tourism make it quite clear that tourism will be the main employer in certain parts of Scotland. Someone who concentrates on tourism obviously has different concerns from someone who concentrates on industry. We must be assured that the needs of the tourist industry in Scotland will be recognised by the local enterprise companies.

I know that a number of my hon. Friends are still trying to catch your eye, Mr. Deputy Speaker, but I should like briefly to return to one of the most important aspects of training. Earlier, I asked the Secretary of State for Scotland a question, which cleverly he did not answer ; the Minister of State, Scottish Office may do so when he replies to the debate. The difference between local enterprise companies and the training and enterprise councils in Scotland and England is the performance contract. In the United States, before training managers are paid, the people whom they train must be in employment. We need to know from the Minister whether the local enterprise companies will have to agree such a contract with the central board before they gain control of training finance. If we are not given that guarantee, there will be serious doubts about whether that training will be meaningful.

8.59 pm

Mr. Mike Watson (Glasgow, Central) : One of the main failings of the Bill is that it represents an abdication of responsibility by the Government. It seeks to encourage others to carry out training rather than the Government financing it themselves. That will not surprise those who have watched the Government in recent years. None of the United Kingdom's main competitors does not have a major responsibility for publicly funded training. They know the value and importance of training in an advanced and advancing economy, but it appears that the Government are content to leave that vital function, like so many others, to the vagaries of the market.

United Kingdom employers--and Scotland is no exception--have shown over many years that they have little inclination to take training seriously, at least when it costs them money or lost production. Unfortunately, that

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applies evenly across the spectrum in Scotland, from manufacturing industry to the service sector and particularly to insurance companies. Given the low priority that the private sector consistently gives to training its work force, on what basis can it or should it be assumed that it can be galvanised to take on a leadership role in training provision?

The Secretary of State was quite happy to refer to the support of the Convention of Scottish Local Authorities, but it said : "Scottish employers have been unwilling to invest in training programmes ; they have not taken a pro-active role in respect of the unemployed ; and they have not been prepared to assist in long term planning. It is unlikely, therefore, that employers will be able to deliver on their own the strategy as outlined by the Government." Yet, quite perversely, the private sector has been given an in-built guaranteed majority on Scottish Enterprise and Highlands and Islands Enterprise and on the local enterprise companies. Surveys in Scotland have shown that fewer than one in three employers have a training plan or training targets, yet they are to be given two of the three places on local enterprise committees. They have clearly illustrated an inability to plan or even to appreciate the value of training, yet they are to be entrusted with the responsibility for planning and implementing training programmes for entire communities or areas. If there is a logic in that, it is beyond my wit to find it.

Local authorities, education departments, trade unions and voluntary bodies make no provision to ensure that they are able to make the positive contribution that they are clearly qualified to make. Indeed, the voluntary sector in Scotland currently provides one third of all employment training places involving a budget of more than £40 million annually. Surely such expertise should be taken advantage of, or treated as the undoubted resource that it is, to allow the voluntary sector a guaranteed role in the local enterprise companies. Surely it should be regarded as a partner, not a client. To do otherwise is simply wasteful.

Local authorities in Scotland have promoted economic development with conspicuous success in recent years. The Glasgow eastern area renewal, the Dundee project and the Govan initiative, which were all mentioned earlier, are good examples of local economic regeneration and the creation of jobs on both sides of Scotland. They are examples of projects in which vast investment was demand-led and often involved the channelling of resources to areas of deprivation. Where is the incentive in this legislation for the private sector to channel investment into such areas? The White Paper made no mention--nor, as far as I could detect, did the Secretary of State--of the long-term unemployed, many of whom are poorly educated, live in poor housing and feel alienated from the real world. Who will want to invest in them?

That begs the question about the intention of the Bill to tackle the chronic problem of long-term unemployment, which has been mentioned too infrequently in the debate. It seems much more likely that the local enterprise companies will be content to churn out trained workers for the hi-tech industries. To do that would be to betray the thousands of Scots who desperately want real training to enable them to re-enter the job market. Unemployment remains a major blight on Scotland's economic landscape. That is especially true of youth unemployment, which, in the west of Scotland, stands at 25 per cent. One in four of all young people seeking work cannot find it.

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For that reason, how employment training and the youth training scheme will be dealt with under Scottish Enterprise needs urgent clarification. The employment training scheme continues to be virtually ignored in Scotland, where employers have almost no interest in it. When they have taken it up, it has been well exposed in the media that there have been many abuses of public funds and of the training needs of thousands of Scots who find themselves used as cheap labour. The Secretary of State should spell out clearly whether local enterprise companies will have the right to opt out of employment training and the YTS in favour of real training initiatives or whether, as many of us suspect, they will be welded irrevocably to the United Kingdomwide task force of the Secretary of State for Employment, which fails completely to take account of local needs.

The establishment of Scottish Enterprise will mean the disappearance of the Scottish Development Agency. It is clear that over the past 10 years the Government have found it difficult to accept the successes that the SDA has achieved. The roots of that go back to 1975, when the SDA was established by the Labour Government, which is clearly a sore point for those currently in control at the Scottish Office. Having cut the funding of the SDA by 25 per cent. in real terms over the past decade and still having failed to damage it seriously, the Government have resorted to getting rid of it by subsuming it in Scottish Enterprise.

In doing so, the Government are discarding wantonly several vital assets. As we have heard today, many of the high-calibre staff of the SDA have been leaving for some time because they are dismayed by the prospects that face them under the Bill. Even more damagingly, the establishment of Scottish Enterprise and the local enterprise companies will destroy the strategic Scotlandwide analysis of economic development, leaving a dangerous vacuum at the centre. The central role that the SDA has carried out successfully will also be lost. The Convention of Scottish Local Authorities, in its submission, to which the Secretary of State referred, said :

"the convention's view is that the national bodies should retain sufficient responsibilities centrally to provide the strategic context for the rational and effective development of the LECs." That is a vital resource, which should not be allowed to be discarded.

A more tangible disposal of assets can be seen in the decision to dispose of the portfolio of investments that the SDA has assembled to underwrite its initiatives. Taken in totality, the plans represent nothing less than a criminal waste of talent and resources for the people of Scotland. Unfortunately, they are yet another example of the Government's narrow thinking in an area where additional public resources channelled to those with expertise and experience allied to the necessary will could have achieved so much more.

In his opening remarks, the Secretary of State encouraged Opposition Members to amend the Bill in Committee. It remains to be seen whether it will be possible to insert some safeguards or whether, as has so often been the case, the minds of the Secretary of State and his colleagues are already firmly closed on this issue.

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9.8 pm

Mrs. Maria Fyfe (Glasgow, Maryhill) : Earlier today I asked the right hon. Member for Ayr (Mr. Younger) how he expected that we should get enough employers from a sufficient variety of enterprise to conduct training when the unemployment level in some areas was so high. I reminded him that unemployment in Glasgow was especially high. I must add now that the current unemployment level in Glasgow is 52,000. In Scotland as a whole, there are 40 travel-to-work areas where the unemployment level is higher than the United Kingdom average. In those circumstances, how will training be conducted for the industries that do not exist in some localities yet are needed for the economic regeneration of the country as a whole? We have been putting that point all day, and we are still waiting for an answer. I also worry about the thoroughness of training and the wider education of those who are being trained for industry. It seems obvious to the Opposition that the local enterprise companies will naturally be tempted to concentrate on the narrow needs of the employers who are running the enterprise companies.

In recognition of that, and in an attempt to overcome the narrow interests of particular employers, craft training has in the past been conducted at work, in the firm, and craft apprentices have gone out for training to local further education colleges where they could learn how other companies performed various tasks. Hon. Members will appreciate why we are now worried lest the scope of training is narrowed to such an extent that any training that is given is inadequate.

Nothing has been said about the wider education implications of what is proposed for young trainees, remembering the importance of training for their future. If they are trained simply to carry out narrow tasks, without having a wider idea of craft skills--I shall not go into the question of time being spent on their general education--they will be less able to transfer such skills as they have elsewhere, to other employers. That will, in turn, make them less able to conduct themselves as good adult citizens, effectively promoting their own rights. We are concerned about those and other dangers.

It is incredible that local employers are to be put at the forefront of the proposed scheme, with local authorities and people who have spent their lives in education being pushed to the back, their views and experience not receiving consideration. Running training courses is not something for amateurs. To set achievable targets for learners, to devise suitable written lessons and practical work and to test students' achievements are matters in which success has not always been achieved, even in the circumstances I have described, when we have brought together local authorities, educationists and employers.

I have witnessed students failing courses partly through their own immaturity but partly through inadequate standards being set for them and the poor monitoring of their performance. Instead of responding to the worries that we have on those scores and improving the present system, it seems that the Government are creating a system under which those shortcomings will be even more likely to occur because of inadequacies in monitoring and shortcomings in devising lessons. Unless there is a preponderance of people with experience of preparing lessons, marking exams and running courses, we shall continue to worry about the

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outcome of the new scheme. In tandem with what is proposed, industrial training boards have been abolished. That gives us more reason to worry about the future.

Several other aspects of the same problem have not received much airing in the debate. Clause 16 of the Bill says that it would be unlawful to discriminate against any person providing training. Such a provision is to be welcomed, but how does the Minister square that with the views of the former Secretary of State for Employment, who has denied the child care allowance to married women who apply for training?

It seems incredible that when a married woman with three children under five whose husband's pay could not stretch to three lots of child care appealed against being refused child allowance for training, and then won her case at an industrial tribunal, the Government threw the might of the state against that solitary woman and appealed against the tribunal's decision. That step was taken by the bunch we see on the Government Benches who say that they are interested in equality of opportunity and in women having equal rights to training-- [Interruption.] Is the Minister not even interested in listening to the points that I am making?

I would be interested to hear about the track record of those who will be running local schemes, in particular their track record on training opportunities and securing jobs for women. I dare say that some of them are adequate, but one is left wondering whether such matters have been examined in a coherent way.

Does the Minister intend to establish a body to monitor his proposals? If so, may we be told? Not a word has been said about how the scheme will be monitored. We are left to worry lest, as usual, women's job and training opportunities are limited in the main to a narrow range of skills and low- paid jobs with little opportunity for women to obtain the traditional skills which have normally been held by men.

If women are to receive proper employment and training opportunities, the whole issue must be examined more seriously than the Government have shown any signs of doing so far. It is all the more vital that the Scottish Trades Union Congress proposal to set up an independent body to examine the scheme is acted upon. The Ministers have shown no sign of taking any interest in those matters. They have not even seen fit to mention them tonight. That is how interested they are in the training of girls and women in Scotland.

The Minister of State, Scottish Office (Mr. Ian Lang) : I shall not use up too much time. Not only was I listening to the hon. Lady, but if she looks at clause 2(4)(a) she will find that specific provision is made to

"include arrangements for encouraging increases in the opportunities for training that are available to women and girls or to disabled persons".

Mrs. Fyfe : That proves that the Minister did not listen to what I said earlier. I said that if married women are not given an allowance for child care clauses 2 and 16 will be utterly meaningless. They are just words unless they are followed through with proper child care allowances for married women in particular. When the Minister says that opportunities will be given to women, let him spell them out. Local enterprise companies have been talked about for months, yet no ground has been broken in terms of training opportunities for women. If the Minister can give concrete examples in his reply, I shall be all ears. For all

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