House of Commons Hansard Debates for 16 Oct 1991

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Such a claim is about as relevant as trying to blame primitive man for the Government's present condition. The Government are caught in the constipation that they have created for themselves. I note that the Secretary of State for Employment smiles through it all. I have some other propositions for the Government. Do they honestly believe that they have created an economy that is as successful as their amendment suggests? I would bet a pound to a penny--a lot of people have had their pounds taken off them and only have pennies left--that, if things were as good as the amendment suggests, the Government would have had the general election in November. Gosh almighty, the Government would have had that election and the hon. Member for Hartlepool, instead of walking into the Chamber for a restful night, would have been sitting at home retired.

There are the Government, bless them, clinging on. They have nearly lost their grip. They hope that something somewhere will retrieve the situation and will get the headlines so as to cover up the awful mess that they have created. Do they honestly believe that the record number of bankruptcies in this country is something that industry will forget about? Do they honestly believe that all those people who have had their houses repossessed will forget all about that when it comes to the contrived date of the next general election? When the unemployed go down to the supermarkets or the cheapest places where they can buy food--many are forced into that these days--will they say, "I understand about this inflation business that I have been hearing about on the telly"? Inflation may be coming down, but in the shops the prices are going up. Will those people be amused for one moment when the local authorities, having been rate-capped and all the rest of it, put up their rents by between £3 and £4 a week?

The Government turn round to people and say, "Don't you be greedy now, fellas. Don't be asking for pay increases of any more than 4.5 per cent." Do they honestly believe that the unemployed will forgive them for the torture that they have gone through and the fact that their expectations have been smashed to the ground? Do they believe that the students will forget that during this past holiday they could not get a button to live on? Those young people form the most generous young generation that I have known in all my adult life. They are creative young people who have been pushed by the Government's legislative requirements to go from one town to the next looking for jobs.

Do the Government think that people in the poverty trap who must pay the poll tax and do not know how to get the money together will forgive them? I remember in particular one man who showed me his room. It measured some 12 ft by 5 ft, and he had to have everything in it, but he was paying more poll tax than me. What a crazy world the Conservative party has brought about. It has been like going back to the dark ages.

We do not have a listening Government. There have been some fine people in the Conservative party, but they have been caught up in a dogma that has not been in tune with the mood of the times. For example, after all the years following the war, I should have thought that the manner in which the Government closed down coal mines would have been avoided. If only they had done what we preached. If a mine must close, we have sufficient knowledge and experience of the geology, the market and the technology to consider the decision, but allow a period

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of some two years in which to regenerate industries in the area. Instead, the Government decide to close a mine and then start to regenerate the area. Those are simple little things that need to be observed.

Only one reference to transport has been made today. Transport is a vital part--indeed it is the bloodstream--of the economy, where Britain does everything wrong. We do not emulate, as we preach from time to time, what is done in Europe. In France and Germany, for example, electronic signalling, stations, track and the general infrastructure are all considered to be part of the social capital. They do not enter the question of finance as they do in Britain. As a result, those countries have a better system and can match up to their freight carriage requirements. They spend several billion pounds a year on developing their railways, whereas in this country £700 million-worth of public service obligation grant will be reduced to some £300 million. That is a pathetic record.

This debate should continue for at least another two or three days, because there is so much to be said and so many challenges to be made. The Government preach a performance that is in the minds of the Walter Mittys of politics. The Conservative party's record is rotten, rotten, rotten.

9.9 pm

Mr. Tony Blair (Sedgefield) : The purpose of this debate is to hold the Government to account for the long-term damage that they have done to Britain's industrial base and for the short-term effects of a recession which has seen almost 1 million more people join the dole queue since it began, and to say that a Government with such a shameful record over almost 13 long years no longer have any right to claim the trust of the British people.

Over the past year we have lost almost 300,000 jobs in manufacturing, 150,000 jobs in the service industries, including 60, 000 jobs in banking, and 70,000 jobs in the retail industry. In the construction industry alone, another 100,000 jobs have been lost. Until today, we have had this year the fastest rising unemployment not only in Europe but in the whole of the western world. That has occurred not just in every sector of industry, but in every region in Britain. In the south, unemployment has risen by 129 per cent ; in the south-west it has risen by 91 per cent., in East Anglia it has risen by 79 per cent., in London it has risen by 78 per cent. and in the midlands it has risen by more than 60 per cent. As my hon. Friends-- particularly those with constituencies in the north, Scotland and Wales-- have said, the light of recovery from the first Tory recession has barely flickered long enough to be perceptible before being snuffed out by the weight of the second Tory recession. In every part of Britain, in every type of occupation at the workplace, businesses have collapsed, redundancies have been declared and human lives have been blighted. What did the Conservative party tell us at its conference last week? In the light of that record, the Government ask us to trust them. Let us tell them that the men and women who are the victims of the recession do not trust them, but feel a deep and genuine sense of betrayal at what has happened to them. It is not true, as the Government also tell us, that every other country has suffered equally. In many countries--for example, Germany-- unemployment

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has fallen this year. Unemployment has fallen in the Netherlands and even in Spain. Unemployment in Japan remains at 2 per cent., in Portugal it remains at 4 per cent. and in the United States, where it has risen, it is now falling.

In the past year, unemployment in Britain has risen by a greater extent than in the rest of the European Community put together. According to the International Monetary Fund, Britain has not merely experienced the sharpest rise in unemployment, but suffered the largest fall in employment and next year, 1992, we will be the only country of the major countries of the Organisation for Economic Co-operation and Development to suffer a fall in employment. What has been the attitude of the Secretary of State for Employment? In a debate in the House barely a year ago he said that the scale of what the Government had achieved was far too often taken for granted and that their record on jobs was unequalled in Europe and the envy of much of the world. He said that with impeccable timing, as the next month we became the only country in the EEC to have rising unemployment. As unemployment began to rise, so did the excuses, and the more unemployment rose, the more tortuous and facile the excuses became.

Last May, the Secretary of State told us not to worry because unemployment was rising only in the south. In July, when unemployment began to rise everywhere, he told us that it was concentrated among men, not women. In November, when unemployment stopped that unlikely piece of positive discrimination, he said that the numbers of long-term unemployed were still falling. When, in February, the numbers of long-term unemployed also rose, he opined that it was only the underlying rate of unemployment that mattered, not the increases. When, in May, unemployment fell by less than in April he claimed that it was now an established, downward monthly trend. When, in July, it rose by more than in May or June, he said that he had really meant a three-monthly trend, not a monthly one.

Throughout that period there were plenty of excuses, but not one word of apology. Not one initiative was introduced and there was not one word of admission that unemployment was now rising north and south, among men and women, in services and manufacturing industry and in the long term and short term. If the policies of the Government are not changed, unemployment will carry on rising not just to the end of this year but into 1992.

Mr. Howard : Is the hon. Gentleman's definition of an initiative one that is not boycotted by the TUC? Unless he is using that definition, what he has just suggested about initiatives is a travesty of the truth.

Mr. Blair : We shall come to the employment action scheme, but first I must point out that for 18 months unemployment rose by more than 800,000, yet the Secretary of State did not lift a finger to help the unemployed during that time. More recently he has excelled himself and thrown all caution to the wind. Clearly, he belongs to the school of political thought that believes that the less credible someone's position, the more extravagant the claims in support of it.

Last week on the "Today" programme the right hon. and learned Gentleman was asked by Mr. Brian Redhead

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about the 1,000 jobs to be lost at the Ford motor company. Did he accept that as a problem, a result of the difficulties caused in the economy? He said :

"Well, I think people understand, Brian, that in a dynamic economy you have to have change."

So : record job losses, rising bankruptcies, soaring business failures are all evidence of a dynamic economy. One almost felt as if the right hon. and learned Gentleman thought it unreasonable of the Ford work force not to be celebrating.

There is no bad news, therefore, that is not good news ; no disaster that is not, on reflection, a triumph ; no evidence of recession that is not, after all, a sign of recovery. And this is the party that asks us to trust it.

No doubt the 400 jobs lost yesterday at the Norwich Union are evidence of a dynamic economy ; likewise the closure of Rolls-Royce in Crewe, the 400 jobs lost at Asda, the 300 jobs at Hawker Siddley, the 740 jobs lost the week before at Ferguson television, the 1,000 lost at Eagle Star and the 300 job losses announced in this debate by a Labour Member. Are these really evidence of a dynamic economy? When, after the next election, the Secretary of State loses his job perhaps he will call that the result of a dynamic economy--it is certainly the only guarantee that we shall get one.

Sir Julian Ridsdale : Will the hon. Gentleman be generous enough to admit that this month Nissan is creating 1,000 new jobs in the north-east?

Mr. Blair : Of course we welcome new jobs, but if I will welcome them, will the hon. Gentleman in turn condemn the Government for allowing unemployment to rise by 750,000?

Trust us, says the Secretary of State. What does he offer to back up this exhortation? He offers us employment action, a scheme which is to reach its peak in March next year and which is then to be run down within a year. It has places for at most 26,000--representing fewer than half those involved in one month's increase in unemployment. It represents fewer than 50 places per constituency at a time when most constituencies will have lost more than 2,000 or 3, 000 jobs in the course of the recession.

Mr. Riddick : Having just welcomed the news of the new jobs created by Nissan, will the hon. Gentleman take this opportunity to condemn the TUC for describing Japanese inward investment as "alien"?

Mr. Blair : Not only does the Labour party welcome inward investment, but if the hon. Gentleman comes to my constituency he will see that the single biggest investment there this year will be placed by Fujitsu at Newton Aycliffe--an investment welcomed by Labour local authorities and the trade union movement.

Employment action does not pay the rate for the job ; it pays benefit plus £10. It was launched during the Tory party conference and the only well-funded part of the scheme was its advertising campaign, in the form of posters that say, "I can work, I can work, I will work, I will work"--as if the problem of the unemployed were the unemployed themselves, not the recession created by Ministers. It is not the will to work that our unemployed lack, it is the opportunity to work, and that is what the Government should give them. In the past year almost 1 million people have gone on the dole, vacancies at job centres have halved, and the increase in those claiming benefit is running at more than

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2,000 a day. The Government scheme is woefully inadequate and utterly cynical in the gap between what it can achieve and what is claimed for it, and it shows beyond any doubt that the Government who are responsible for this recession have turned their back on its casualties.

Ministers say, "Trust us." What stands out above all else is not just the depth of the recession, which the Government promised would never happen, but the fact that they have learnt nothing from the recession. Far from disowning the policies that brought the recession, the Chancellor makes it clear that he will repeat them at the earliest opportunity. Over the past few years our central case has been that the mistakes that led to this recession were not merely temporary errors of judgment by an over-confident Chancellor in 1988 but are the mistakes made over 13 years of Conservative government for which all Ministers bear responsibility. Over that time Britain had the bonus over all its competitors of North sea oil, and squandered it. As other countries invested we merely consumed, and the long -term interests of industry were sacrificed to the short-term politics of an unsustainable boom.

In those 13 years manufacturing investment per person grew three times as fast in the Netherlands, twice as fast in Italy and France, and half as fast again in Germany and Japan. It even grew faster in Korea and Singapore than in Britain. Over those 13 years, manufacturing investment in the United Kingdom has declined while it has risen in every other EC country. It rose by 52 per cent. in France, by 48 per cent. in Germany and by 73 per cent. in Italy. Manufacturing output in Britain has risen by 6 per cent. in those 13 years, but it has risen by 62 per cent. in Japan, by 32 per cent. in the United States, and by 26 per cent. in Germany, and is higher in every other OECD country except Greece.

Is not the lesson of those 13 years clear? Unless we change course now and recognise the neglect of our industrial base and take steps to remedy it, and unless, above all, we invest in the skills and talent of our people, we will never achieve the stable growth or enjoy the long-term steady progress that is the hallmark of any successful modern economy. That is our challenge to the Government. The true dividing line, the real test of competent economic management, is between the Labour party, which has policies for industry and believes in it, and the party which has spent 13 years undermining it. In this, the second Tory recession, we are not seeing a cleaning out of old, inefficient industry or the removal of old, outdated skills. We are losing capacity that we cannot afford to lose and skills that we desperately need to keep. What grounds do the Government have for asking us to trust them in future when they have failed so dismally in the past?

"Trust us with training," they say. Over the past three or four years the training budget has gone down by 23 per cent.--a £1.5 billion cut. I invite the Government to name another country in the Community that would cut its investment in training a year before the single market takes effect. The Government say, "Trust us with industry" which now receives barely one third of the support that it received 10 years ago.

Mr. Howard : Before the hon. Gentleman leaves the subject of training I hope that he will give a specific answer to a specific question. When did the hon. Gentleman make representations to the Transport and General Workers

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Union, which sponsors him, to reverse its boycott of youth training, employment training and the training and enterprise councils?

Mr. Blair : If the Secretary of State spent half the time that he uses to make pathetic attacks on the trade unions in helping training, Britain would be much better off. The Labour party has made its position clear. My colleagues and I have said throughout the past two years that we would not be doing what the right hon. and learned Gentleman is doing with the youth training programme, which is cutting it.

The right hon. and learned Gentleman says, "Trust us, the Government, with unemployment." Surely the most revealing attitude towards unemployment was set out in the letter from the Chief Secretary to the Treasury to the Secretary of State about his Department's budget. It tells us how much we can trust the Government. Let us leave aside the massive cuts that are proposed and consider what the letter tells us about the Government's attitude to training. The Chief Secretary said :

"I see no automatic link between higher unemployment and the need for further Government provision for training."

Is that what we were told by Ministers when the Government launched employment training? The letter continues :

"Employment training offers particularly poor value for money. Nor do I believe that even the recession can account for the failure rate of over 70 per cent. which you project for next year."

Is that right? Is that projected? Has the right hon. and learned Gentleman fought against the terms of the letter? Will he tell us? Is employment training to be starved again of the resources that are required? Is there to be cut upon cut? Should we trust the Government with employment training when they have introduced cuts?

Does the right hon. and learned Gentleman agree with what the Chief Secretary writes about the Government's programme and the higher technology national training initiative, the only initiative dealing with skill shortages and higher technology that the Government have? What is suggested? I talk of an initiative that has apparently helped about 7,000 people over the past couple of years. That is the number who have gained from it. The Chief Secretary says that it should be scrapped. Is it to be scrapped? Are we to be told whether the initiative is to be sacrificed as a result of the Government's short-term approach?

Career development loans have benefited 16,000 people. The Secretary of State says, "Trust us." According to the Chief Secretary's letter, these loans, too, are to be scrapped. The business enterprise training programme is designed to help employers with their training courses. The Government say that that, too, should be scrapped. Is not that the clearest warning to the unemployed and to industry that whatever the Government say in public, in private their commitment to training is as skin deep as their commitment to industry?

The Government say, "Trust the people." I say that the real issue is why the people should trust a Government with such a record.

Mr. Allen McKay (Barnsley, West and Penistone) : Has my hon. Friend considered the fate of Astra Services and the training centres? Has he considered what has been

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done to a loyal work force, many of whose members have provided long service? My hon. Friend will be aware that £11.7 million was provided to retain the civil service rates of redundancies and retirement, which were then blatantly disregarded. The result is that some of my constituents are losing about £27,000 each. Will the £11.7 million of taxpayers' money be paid back or will it go into the directors' pockets?

Mr. Blair : My hon. Friend is prescient. I was about to refer to skill centres.

As I have said, the Government ask us to trust them. They do so on the basis of their record. Let us consider what has happened to the 60 skill centres that Britain used to have. It was only a year ago that the 60 centres--centres of excellence for training--were privatised. We, the Opposition, opposed that privatisation and warned against it. Forty-seven of those 60 went to the company called Astra Services. It is a new company. At the time, the Secretary of State said :

"These proposals will be seen to be giving them tremendous opportunity for the future, enabling them to build on the excellence of the centres and ensuring that they can provide training of even higher quality."

I have a copy of a letter that Astra Services sent to its staff. I believe that it was to this that my hon. Friend the Member for Barnsley, West and Penistone (Mr. McKay) was referring. The company is announcing that it is having to scrap the voluntary redundancy scheme for its employees and that it may have to make compulsory redundancies among its own trainers. The reason that is given for this is cuts in Government funding and the recession, which makes it more difficult for the company to exist as a centre of training excellence.

Is that right? Are trainers really to be made redundant at a time of critical provision for Britain? Is the company to be allowed to do that? What explanation does the Secretary of State have, bearing in mind the assurances that we were given that the centres would improve and the reality of what is now taking place?

Worse, four of those skill centres were sold to a consortium headed by a Mr. Lakin. Those four skill centres were dotted around the country, again providing training that we desperately need, but I am told tonight that they are now in liquidation. Is that right? If so, why were we told at the time of privatisation that they had a great new future when we now see them laying off trainers and some even going into receivership and liquidation? "Trust us," the Government say.

The information technology centres, giving information technology training to the unemployed, provide a vital service. Many of my right hon. and hon. Friends will have such centres in their constituency. A year ago the Opposition warned that cuts would put those centres at risk. Today we have been told that within the past few months 40 of those centres have not merely faced cuts but have closed altogether, and at many others there are now substantial queues for the young and unemployed.

The list is endless. Cobalt UK in York has closed with 13 staff made redundant, along with Jobstream in Nottingham and South Durham Enterprise. ApexTrust has closed 17 of its centres. The National Council for Voluntary Organisations reports that 2,000 trainers have been made redundant in the past year. Yet the Government say that we should trust them with the nation's training.

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Because unemployment is rising, matters will get worse. I challenge the Secretary of State to tell us tonight whether it is true that many young and unemployed people are not being given the guaranteed training places which the Government promised but are being shoved from the dole queue to the benefit queue to the training queue ; being forced to queue up for the training that they were promised.

Mr. Ian Bruce (South Dorset) : Will the hon. Gentleman give way?

Mr. Blair : No, I am sorry, but I must get on.

Today the Secretary of State will be sent a letter from the National Joint Council for the Building Industry, comprising both employers and unions, telling him of a 45 per cent. cut in new apprentices for the building industry--2,000 fewer to be given training now and due to funding cuts the construction industry training board will have some 6,000 fewer trainees.

We see the collapse in those training programmes, the closure of training centres and the cuts in Government provision. Every responsibility has been shirked, every promise broken, every trust betrayed. That is the Government's record for which we hold them to account. Why should we trust them to improve the nation's training when they have cut its spending and despise even their own initiatives? Why should we trust them to bring down unemployment when the Ministers who created it are entirely without policies to combat it? Why should we trust them to revitalise and regenerate Britain's industrial base when for 13 years they have undermined it and even questioned its importance?

Trust in the first year of a Government may be built on promises, but after 13 years it must be built on the Government's record. Why should the public buy the Government's promises when it already knows the Government's record? They do not deserve our trust and they know it. If the Government were confident of the nation's trust this would not be the first Opposition day of a new parliamentary term but the opening day of a general election campaign to decide the government of Britain. The only reason that it is not is the same reason that there was no election in March, June or October. It is because the Government dare not call an election, precisely because they know that they do not have the trust of the British people, so they sit on, clinging with no purpose, no direction, no motivation except fear of action, desperately looking for something to give them the impression that they still exist as a Government.

The Government's business has been derailed by indecision. They are led by a Cabinet stuck in a political waiting room and presided over by a Prime Minister with neither a timetable nor a destination. They are Her Majesty's Opposition in waiting. Whenever they have the courage to call an election it is the Opposition who will have the people's trust to win it.

9.34 pm

The Secretary of State for Employment (Mr. Michael Howard) : Perhaps the least edifying part of the debate has been the way in which the hon. Members for Dunfermline, East (Mr. Brown) and for Sedgefield (Mr. Blair) vied with each other to spread bad news and to run our country down. The way to get ahead in the Labour party is to run our country down, to find some unflattering comparisons

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that put British industry, British products, and British workers in an unfavourable light, and to gloat over them with gruesome glee. Both hon. Gentlemen made much of what has happened to the economy in the past year. They may care to recall that, on average, each day since the Government first took office in 1979, 220 jobs have been created, 440 new businesses have been founded, and new homes purchased by 880 families.

I will deal straight away with the facts about British manufacturing industry--the facts about output, productivity, profitability, and exports, which Labour always chooses to ignore. It is typical of the Opposition to confine their arguments to those statistics which relate exclusively to the recent recession. We all know that there has been a recession in Britain, and we all know that recessions are painful, so Opposition Members have hardly added to the sum total of human knowledge with their litany of woe. It is important to look at the whole picture over the period since this Government came to office to put the situation in context. If one looks at that picture, one finds that the output of our manufacturing industries has increased under this Government. It fell under Labour. The profitability of our manufacturing industries increased seven times faster in the 10 years to 1989--the latest period for which figures are available--than it did under Labour. In the 1960s and 1970s, Britain was bottom of the international league in the growth of manufacturing productivity, but from 1980 to 1990 this country's manufacturing productivity grew on average by 4.7 per cent. per year--the fastest growth rate of all the major industrialised countries. To put it another way, under Labour manufacturing productivity grew by only 7 per cent., whereas under a Conservative Government it has grown by nearly 50 per cent.--at an annual growth rate two and a half times greater than that achieved under Labour. It is already clear that manufacturing productivity has been increasing again, even during the recession. That is an excellent sign for the future.

Manufacturing exports did not increase at all under Labour. Under this Government, they have increased since 1979 by more than half, at an average rate of 3.5 per cent. a year. According to the latest United Nations figures, since 1983 Britain's exports of manufactured goods grew faster than those of all our competitors in the major exporting countries. If Labour Members really cared about what is happening in this country, they would listen to these figures, take them seriously, and take them on board instead of just looking for the bad news to try to run our country down.

Mr. Ian Bruce : Did my right hon. and learned Friend note, as I did, how much was said by the hon. Member for Sedgefield (Mr. Blair) in the course of 34 minutes about Labour's policies--namely, nothing? Has my right hon. and learned Friend received any representations from Labour Members to do away with wages councils? Negotiations between employers and trade unions produced a figure of £2.75 per hour for 18-year-olds, but Labour Members, who say that they believe in wages councils, are proposing a figure of £3.40 at today's values, increasing to £4.20 as soon as possible.

Mr. Howard : My hon. Friend the Member for South Dorset (Mr. Bruce) is right to point to the paucity of

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policies from the hon. Member for Sedgefield in particular, but we are used to that. We gave up hope long ago of Opposition Members advocating imaginative policies. The hon. Member for Sedgefield said that we had no policies and then ran through a long list of the initiatives that we have introduced and bemoaned the fact that he thinks that they will be cut. I shall not be deflected from the good news about the Government's record, and about what has been happening to manufacturing industry.

Perhaps Opposition Members would care to reflect on manufacturing exports. Perhaps they think that those are of no account and they are not interested in what has been happening to them. The average growth in the value of Britain's manufacturing exports between 1983 and 1990 was 13.9 per cent.-- higher than the 11.5 per cent. of the United States, higher than the 10 per cent. of Japan, and higher than those of Germany, France and Italy. We have halted decades of decline in Britain's share of the world trade in manufactures. Last year it rose for the second year running.

It is worth noting--Conservative Members will pay attention to the fact-- that that is a truly remarkable achievement. It is not only the reversal of a trend that has been running throughout this century. It comes at a time when the competition from other countries involved in exporting manufactured goods is steadily increasing--in Europe, in Latin America, in Asia. Yet now, despite the ever-increasing presence in manufacturing exports of Taiwan, South Korea and others, and on top of that of Japan, Germany, and the United States, we are increasing Britain's share of that trade. And in the three months to August we recorded a surplus in manufacturing trade for the first time in nine years. That in anyone's terms is a record of success.

Mr. Robin Corbett (Birmingham, Erdington) : If that is the case, can the Secretary of State explain why the Jaguar body plant in my constituency is working only three weeks out of every four and why, half a mile up the road, a GKN subsidiary, Hardy Spicer, which makes front-wheel drives, is on similar short-time working? Is that a success?

Mr. Howard : Has it escaped the notice of the hon. Member for Birmingham, Erdington (Mr. Corbett) that the United States, which is the most important market for Jaguar, has been undergoing its own recession? Has he not paid any attention to what has been happening to the United States? Is he not aware of what has been happening in the countries which have been Jaguar's markets? The same applies to many other countries. The hon. Gentleman's question disqualifies him, by the depth of his ignorance, from playing a serious role in these debates.

Mr. Tony Worthington (Clydebank and Milngavie) : Will the hon. Gentleman give way?

Mr. Howard : No, I want to press on.

Britain's manufacturers themselves are much more confident about their performance and their prospects. A recent survey by Investors in Industry showed that no fewer than 83 per cent. of respondents thought that British manufacturers were better able to cope with the recent recession than that of ten years ago.

The CBI has spoken of "the transformation" of British manufacturing industry in the 1980s. It is the common

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consensus of those who actually work in Britain's manufacturing industries that they are incomparably better placed to face the 1990s than they were at the beginning of the 1980s. The only doubting Thomases are those like Opposition Front-Bench Members who by background and inclination are more at home on the picket line than on the production line.

With regard to manufacturing employment, it is true--I wish it were otherwise--that employment in manufacturing is falling, but that is hardly a new phenomenon. It has been in decline for a quarter of a century, since 1966. And it is still the case that on the latest available figures there are more people employed in manufacturing industry in Britain than in either France or Italy.

The fact remains that there are still substantially more jobs in the British economy overall than there were in 1979--and more than 2.5 million more than there were as recently as eight years ago. Furthermore, there are clear signs of new manufacturing jobs being created during the next few years. Many of those jobs will be home grown. Many will be the fruits of foreign investment. In the 1990s we shall continue to build on the record American and Japanese investment in manufacturing in this country which we secured in the 1980s.

Earlier, my right hon. Friend the Secretary of State for Trade and Industry referred to a Nomura Research Institute survey which showed that Japanese investment alone would--over just the next four years--create nearly half a million jobs, contribute £4 billion to our trade balance and add 2 per cent. to Britain's gross national product. Cumulative Japanese manufacturing investment will increase from £1.3 billion in 1990 to £7 billion by 1995. It will increase the output of cars produced by Japanese companies in the United Kingdom from 78,000 in 1990 to 458,000 in 1995.

That investment should be welcomed by hon. Members on both sides of the House. We know, however, that some people in our country still regard Japanese investment in our manufacturing industry as unwelcome. The Opposition Front Bench refused to answer my hon. Friend's question about the TUC vote in September on a motion which described that investment as "alien". The hon. Member for Sedgefield refused to respond.

There the Opposition sit, looking for all the world like a gang that has just been arrested--determined to say nothing that would incriminate them, and ready to pounce on the first of their number who grasses on the boss.

Mr. Brian Wilson (Cunninghame, North) : Will the Secretary of State give way ?

Mr. Howard : When I last gave way to the hon. Gentleman, he asked a question so frivolous and irrelevant that I made a firm resolution not to give way to him again.

Our manufacturing industries are immeasurably stronger today than they were 12 years ago, and their prospects are excellent. Of course we have experienced difficulties ; of course no recession is ever welcome. What is astonishing, however, is that Labour Members, who are ever eager to pick over the entrails of recession, are so much more reluctant to talk about its cause. They are equally reluctant to acknowledge that the recession is a world-wide phenomenon. Unemployment is rising in every

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European Community country except Spain, and in every country in the European Free Trade Association, and it is higher today than it was a year ago in every G7 country.

I do not deny that part of the cause of the recession lies closer to home ; nor do I deny that some of our recent problems stemmed from mistakes that were made in 1987 and 1988. With the benefit of hindsight, it is possible to see that interest rates were cut too far and too fast in the aftermath of the world-wide stock market crash. That, of course, is why the Opposition are so reluctant to discuss the causes of the recession. What were they demanding at the time? Still further and still faster cuts in interest rates.

The right hon. and learned Member for Monklands, East (Mr. Smith) had only just become shadow Chancellor in October 1987, but he was already stuck in the groove in which he has remained ever since--the belief that interest rates are invariably too high, and should always be cut by 1 per cent. His belief in the panacea of a 1 per cent. interest rate cut was being trotted out even then.

It is clear that if the right hon. and learned Member for Monklands, East-- Mr. One Per Cent.--had been in office at that time, the inflationary surge that we have faced over the past two years would have been much worse, the task of reversing it would have been much more difficult, and the problems that we are now overcoming would have been infinitely more acute. That is the reality. The Opposition's policies would have made matters very much worse had they been in office--and, as I shall show in a moment, they would make matters very much worse if Labour were to take office at any time in the future.

The hon. Member for Sedgefield talked about training. I agree with his remarks to the extent that it is indeed clear that the future performance of our economy in general, and of our industries in particular, will be greatly enhanced by our national training efforts. As ever, however, the hon. Gentleman then presented a grossly misleading and misrepresentative picture of what is happening to training in this country. Having accused us of taking no initiatives, he then proceeded to list all the initiatives that we had taken, and to express his fear that they might be cut. What the hon. Gentleman engaged in was a systematic slander of all those involved in the training revolution that is currently under way, and of the new training and enterprise councils--one of the most exciting initiatives that the country has ever seen, and one that the hon. Gentleman claims to support.

Mr. Blair : Does the right hon. and learned Gentleman think that it was a mistake to cut £1.5 billion off his training budget over the last few years?

Mr. Howard : Unlike the hon. Gentleman, who consistently refused to answer the questions that were put to him, I will answer that question directly. What we did--the hon. Gentleman knows it well--was to look again at the way in which we help unemployed people back to work and to appreciate that, although training is an important way to help them, it is not the only way and not always the best way to help them. We are providing more help to unemployed people, but in different ways. That is why we have a wider range of measures than ever before to help unemployed people back to work.

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Mr. Blair : So that we get this clear, is the right hon. and learned Gentleman accepting that in real terms the training budget has declined over the last few years in the way that I have described?

Mr. Howard : I have told the hon. Gentleman exactly what happened. I told him that we looked at the way in which we were helping unemployed people back to work. We are determined to make that help as effective as possible. That is exactly what we are doing and the hon. Gentleman knows it well.

As for the reality of the training picture, let us look first at what the private sector is doing. In the six years to 1990 the number of employees receiving job-related training rose by 85 per cent. The latest CBI surveys continue to show that three and a half times as many employers expect to maintain or increase their spending on training as expect to cut it, even during the present economic difficulties. Only latest week, the last survey of employers showed that no fewer than 92 per cent. of employers have maintained or increased their off-the-job training since last year. We know, too, that the quality of training is improving steadily. Gone are the days of rigid, centralised time-serving apprenticeships. Instead we have a much more flexible and dynamic training system which is steadily increasing the proportion of the work force who have qualifications. Between 1984 and 1990 the number of people with a qualification increased by a quarter to nearly 75 per cent. of all economically active people of working age. The number who hold a qualification at A-level or above increased by a fifth to nearly one out of every two people available for work.

Earlier this month an academic report comparing the training provision available to young people in Britain and in Germany concluded that young people in Britain benefit from training that is more flexible and more relevant to the world of work than that in Germany. Progress on training is now being made every day. This morning I presented the first Investors in People awards to 28 of Britain's companies, each of which has reached this very challenging standard of commitment to and quality of training. I was able to announce that a further 500 companies have also committed themselves to reaching the Investors in People standard. That is a major step forward in employer commitment to training. It is part of a steadily and sharply improving picture. If anyone were in doubt about the magnitude and momentum of the training revolution that is under way in this country, I wish they had been present at this morning's event just across Parliament square. It would have done the hon. Member for Dunfermline, East the world of good if he had spent his morning there instead of preparinng his cheapskate speech, which served only to reveal the depth of his ignorance of the training that has taken place in this country.

The most damaging single policy for British industry put forward by the Labour party is, of course, its absurd commitment to a national statutory minimum wage. My warnings--that that policy would destroy hundreds of thousands of jobs--have been backed by an ever-increasing chorus of expert opinion. The hon. Member for Sedgefield has tripped, twisted and turned on this issue time and again. Earlier this year he wrote a now notorious letter to The Independent in which he said :

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