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The Prime Minister: My hon. Friend will know that we have received a lot of inward investment here and we continue to do so. However, he is entirely right in that we do not want people to come here for reasons of low wages and, by and large, that is not why they are coming. They want to come here. If we can show that we have an educated and skilled work force that is adaptable to the forces of economic change and if we can make the improvements in our education and welfare systems that the Government are undertaking, we can attract more inward investment to this country and not less.
Mr. A. J. Beith (Berwick-upon-Tweed): While welcoming the involvement of the European investment bank in new lending and the emphasis on small business, labour market flexibility and a genuine internal market, may I ask when we will get the comparable statistics of which the statement speaks, so that we can compare properly unemployment figures in our and neighbouring countries, bearing in mind what the previous Government did to the employment figures?
Does the Prime Minister recognise that regional funds will continue to be vital to the older industrial areas, such as the coal mining and textile areas in Britain, if we are to create jobs there and that the amount of increased investment that we will need in education and training is beyond anything that has been committed so far?
Finally, does the right hon. Gentleman fully support the wording in the presidential statement, for which I presume he is also responsible, that proceeding to the third stage of economic and monetary union will indeed be conducive to stability, growth and employment?
The Prime Minister:
In relation to the figures given and to comparable figures, the national action plans should provide some basis for proper comparison, although I agree that there is a longer-term problem in that statistics are compiled in different ways in the individual countries. There is a separate European initiative to bring those statistics into line with one another, which is on-going, as they say. In due course, we should get a better series of comparable statistics than those we have.
On industrial restructuring, there is a very different approach here, which is to accept that there will be restructuring in Europe. Obviously there can be a debate about how far monetary union will be conducive to economic stability, but the one thing that people are sure about is that with a single currency in Europe there will undoubtedly be enormous transparency of costs. That will of itself force an enormous amount of restructuring. The approach set out here is not to try to ward off that restructuring, but instead to cope with it by bringing new investment into the areas where it is taking place and ensuring that we have the measures in place for the long-term unemployed in particular, who will require retraining in the longer term.
As for education and investment, I do not want to go over what we say at every Question Time on Wednesday, but we are putting a substantial additional sum of money into our schools next year with the school repairs programme of £1.3 billion. If the right hon. Gentleman will forgive me for pointing it out once again, that is more money than the Liberal Democrats asked for before the election.
Mr. Tam Dalyell (Linlithgow):
Did any of the Prime Minister's European colleagues offer so much as a scintilla of regret that we were not joining the single currency in 1999?
The Prime Minister:
I have to say that it was not a subject discussed by us at the meeting.
Mr. James Paice (South-East Cambridgeshire):
To what does the Prime Minister attribute the fall in British unemployment?
Hon. Members:
A Labour Government.
The Prime Minister:
Yes. It is correct that British unemployment has come down, though I have to say that there are still other countries in Europe that are committed to the social chapter. Indeed, they have a minimum wage and have lower unemployment rates than in Britain. We have always said that we must focus on those households with people of non-pensioner age which have nobody working. That is why I say that we still have a long way to go in this country, which is why we have introduced the new deal for the unemployed.
Ms Diane Abbott (Hackney, North and Stoke Newington):
If the Prime Minister supports one of the
The Prime Minister:
I do not think that Conservative Members are in a position to put those questions to us, as they were the ones who introduced the benefit cuts. If my hon. Friend looks at the Budget proposals put forward by the Chancellor in July, she will see that single parents are given specific additional help with child care to help them find work. Measures are being put in place to take people off benefit and into work. However, it is extremely important that we keep within the tough spending guidelines that we have set, because they are right. Whatever irresponsibility may have occurred on the part of the previous Government, it does not occur here.
Mrs. Angela Browning (Tiverton and Honiton):
If the Prime Minister thinks that the minimum wage has nothing to do with unemployment figures, to what does he attribute the high youth unemployment in France and particularly in Spain, where it is nearly 40 per cent? Does he think that the minimum wage has nothing whatever to do with unemployment?
The Prime Minister:
If one looks at France, for example, a criticism that we have made is that if the minimum wage is applied in full, even to young people in training, it can cause problems for young people. That is why we have said that that will not happen here. There are many countries with lower unemployment rates than Britain that have minimum wages. Austria, the Netherlands and the United States of America all have minimum wages but lower unemployment rates than Britain. It is important to introduce a minimum wage sensibly and make it part of a general system of reform, so that this country does not end up, as we did under the previous Government, spending £3 billion a year through family credit subsidising low pay. That is not a sensible use of public resources. It is far better to introduce a proper minimum wage and ensure that people are paid at the proper rate for the job.
Mr. Dennis Skinner (Bolsover):
Does my right hon. Friend agree that, in view of what has been happening in the Asian economies in the past few months and particularly the past few days, we want to hear no lectures of the kind that we heard constantly from the last Government about using undiluted market forces to resolve the problems of the economy and particularly jobs? Many areas of Britain--some 20 or 30 in total--used to have old smokestack industries that were closed by the Tory Government, who are still downsizing the Tory party. Even if there were an economic upturn over and above what is happening today, there is a legacy in each of those areas: the last five or six years of pit closures meant that hardly a single miner had another job to go to, and the social fabric is in decay. We need to deal with those issues, not by means of a European job summit but through old-fashioned intervention from this Labour
The Prime Minister:
I agree with my hon. Friend. Inevitably, no matter how well the economy is doing in general terms, some areas will be left behind by industrial restructuring and change. That is why the jobs summit focused specifically, as a separate item almost, on those who will be long-term unemployed and who cannot get back into work simply because of the general upturn in economic circumstances. Of course, that is why we have the welfare to work new deal programme here. It is precisely to help to tackle some of those pockets of structural long-term and youth unemployment. It is precisely by investing in their skills and through additional resources to improve the education system that we shall give those people a better chance and a better opportunity.
That is what I would call the third way. It is not old-style intervention, but it is intervention and a recognition that markets fail. We should live in a market economy and we want a dynamic market economy, but in some areas the market will fail. One of the things that mark out the Government from their predecessor is that we recognise that, and are prepared to intervene where that is necessary.
Mrs. Margaret Ewing (Moray):
Was there any consideration at the summit of the issue of structural funds? They have been extremely important in areas such as mine, which benefits from objective 1 and objective 5b in the creation of employment. What is the Government's attitude to the continuation of structural funds and will the Prime Minister guarantee that this matter will at least be discussed in Cardiff in June?
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