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10.25 am

Mr. Michael Moore (Tweeddale, Ettrick and Lauderdale): Like the hon. Member for Oldham, East and Saddleworth (Mr. Woolas), I congratulate the hon. Member for Tiverton and Honiton (Mrs. Browning) on securing the debate and bringing this important matter before the House. I am especially grateful for the opportunity to participate in the debate, not least because of the significance of textiles to my area in the Scottish borders. In that area, as in many other parts of the country, there has been a gradual decline over several years in the number of jobs in the textiles sector. In the late 1960s, in an area with a population of 100,000, about 14,000 jobs depended on the industry; two years ago, the number of jobs was down to about 5,000. However, the textile industry still represents 50 per cent. of manufacturing jobs in the Scottish borders and in certain towns--not least, where I live in Innerleithen--96 per cent. of jobs are dependent on textiles. In the much larger town of Hawick, the figure is 88 per cent., which is still a large percentage.

Over the past couple of years, we in the borders have not needed to seek out troubles. There has been a range of job losses, in farming and electronics but, especially in textiles. Companies such as Claridge Mills, Ettrick and Yarrow Spinners, Laidlaw and Fairgrieve, Gardiners and, in the constituency of my hon. Friend the Member for Roxburgh and Berwickshire (Mr. Kirkwood), Pringle have all suffered significant job losses and some of the smaller companies are now closed. That is a roll call of some of the finest names in textiles in Scotland, perhaps even in the United Kingdom, and people are concerned about what the future holds for the industry, especially during the next few weeks and months.

The downward trend in textiles is understood. We have had a useful debate about the pressures on the industry, some of which, as was pointed out, have existed for more than 100 years. In each part of the country, there are successful businesses that are doing extremely well because they have turned themselves into world leaders, by adopting good business techniques and focusing on

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world-class products in niche markets. In my constituency, that process is assisted by the Scottish college of textiles, which has done much work on advanced and applied textile science and technology. The college has now successfully merged with Heriot-Watt university and we hope that its expertise and capability will be enhanced.

Although there have been job losses during the past 20 or 30 years, there have also been successes. Companies such as Lochcarron, currently based in Galashiels, have built themselves up and are now significant employers. During that period, the strength, resilience and development of the cashmere business in our area have been very noticeable. Although problems have been exacerbated by the recent levels of the pound and interest rates--perhaps, in due course, there will even be an effect caused by our non-participation in the euro--people understand that those are large issues on which there is legitimate debate. However, in the borders, people are perplexed about why a trade war between the United States and the European Union should have such a potentially devastating impact on our area--indeed, no one can understand it.

The banana war, as it is called, has nothing to do with the borders. It may relate to important principles of trade between the EU and the United States, but British and Scottish borders traders have been very fair competitors over the years. Whereas so much devastation has happened in our area as a result of outside factors involving decisions by companies in the middle of America or elsewhere to close huge factories, the current problem has nothing to do with economic trends. It seems to us that it is the result of pure spite and retaliation, which should have nothing to do with our area.

I should like to highlight the dependency of the borders on the cashmere sector. It is a highly successful sector. It has allowed itself to develop into premium-pricing areas. Cashmere from the borders features in all the top areas. In Tokyo, on Madison avenue, in London and Paris--you name it--Scottish borders cashmere will be in evidence. The cashmere sector employs 2,500 people, which is almost half the remaining jobs in textiles. It is estimated that there are £20 million-worth of exports a year to the United States alone. Fifty per cent. of EU cashmere exports to the United States come from the United Kingdom. It is estimated locally that as much as 90 per cent. of United Kingdom cashmere production comes from the borders.

As the hon. Member for Oldham, East and Saddleworth (Mr. Woolas) has said, the catastrophe looming in the industry arises because now is the buying season. Now the important decisions are being taken by American buyers about what they will stock in their shops in the next few months. While we hear much about how quickly trade wars can be stopped, the United States buyers are looking now at what prices they will be paying this spring or autumn. As they see the doubling of prices that they may be expected to pay, they look to local producers to share that pain. Some businesses that are very dependent on the United States for their business are contemplating either losing the business because they are no longer competitive or taking on absolutely massive risks by insulating the prices for their buyers.

The borders is only a small area of 100,000 people. Compared to some of the major conurbations in England and Scotland, it may not seem significant, but we have

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seen in so many sectors in the last while the devastation of small communities across the Scottish borders. People cannot comprehend why this particular trade development should put so many more jobs at risk. I am the first to acknowledge that some extremely complex negotiations are going on. I have been pleased at the way in which the Department of Trade and Industry and other Departments have been keen to brief me and my hon. Friend the Member for Roxburgh and Berwickshire (Mr. Kirkwood) on developments.

When I was across in Washington recently with the Select Committee on Scottish Affairs looking at inward investment, the British ambassador arranged for a meeting between me and members of the United States state department. We have had access to people to make our points in various parts of America, Britain and Brussels. I am under no illusions about the complexity of the arguments. However, we find that the confidence is going out of the industry by the day, and people are worrying about what the future holds.

We are not clear about what happened this week at the WTO. To all outside the arcane negotiations, it appears to have been a complete shambles. That is something that we in our part of the world cannot afford to sustain for much longer. I hope that the Minister will be able to update the House on the industry dispute and reinforce the efforts that he, his Department and other Ministers at whatever senior level are doing to ensure that this trade war, which has absolutely nothing to do with the Scottish borders, is ended before it ends jobs in the Scottish borders.

10.34 am

Mr. Terry Rooney (Bradford, North): I recognise the pressure on time so I will try to be brief. I congratulate the hon. Member for Tiverton and Honiton(Mrs. Browning) on securing this debate. It gives us an opportunity to talk about an important industry. I am from Bradford, which used to be the wool capital of the world. I am not sure what description is applied to it now. It has been devastated by what has happened to wool textiles in the past 20 years. My mother, father and two brothers have spent their working lives in textiles. Between them, they have 91 years' service, but unfortunately they also have 23 redundancies. Every reason for problems in the textiles industry has caused a redundancy in my family. I speak passionately, from personal experience of the problems.

My hon. Friend the Member for Oldham, East and Saddleworth (Mr. Woolas) said that there had been 100 years of decline in the textiles industry. Unlike him, I cannot go back that far, but I can look back at significant factors that have affected the wool textiles industry in the past three decades. I am afraid that the management of the industry have a lot to answer for over many years. They failed to be bright and proactive.

In the 1960s, managers decided that the industry could survive if it reduced its labour costs by importing labour from the Indian subcontinent. That would be the solution. There was no investment in plant, machinery, new products or new buildings. They simply reduced costs by bringing in labour from overseas. That obviously failed.

In the 1970s, the answer was seen to be mergers. They did not often involve redundancies, but dozens of smaller companies merged without cohesion, co-ordination or

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management plans for the future. Companies were merged simply to create bigger groups. In the 1980s, for whatever reasons, the industry suffered the most severe recession that it had ever seen and in West Yorkshire we lost 50,000 jobs. The list that the hon. Member for Tiverton and Honiton read out was impressive, but the county of West Yorkshire lost 50,000 jobs in that recession. That produced at last a hard-headed look by the industry at itself, its future and where it could go. As other hon. Members have commented, that refocus resulted in the industry going for the high added value markets, especially Japan and the United States. That brought other problems, to which I shall return.

After the recession there was serious investment in the industry. Sadly, in recent years that investment has fallen off, but in the late 1980s and early 1990s we began to see a plan of action. The hon. Member for Tiverton and Honiton mentioned the Transport and General Workers Union. It is what I have always called the National Union of Dyers, Bleachers and Textile Workers, which was subverted by dubious means into the monolith known as the TGWU. The textile workers section headquarters is in Bradford and always will be. It is about 100 yards from my constituency office and the general secretary is the greatest guy in Britain.

Three issues have had a long-term impact on the industry in the past 10 years. One is the multi-fibre arrangement and the previous Government's failure actively to enforce it and promote its future. The second is the Uruguay round of the general agreement on tariffs and trade. The textiles industry was sold out by the previous President of the Board of Trade, the right hon. Member for Henley (Mr. Heseltine), in order to reach an agreement for agriculture. The consequence of that was an agreement by the free traders of the previous Government that exports from Britain to the United States would have a 37 per cent. tariff imposed on them. So much for the free traders in Washington. The tariff would be reduced by 1 per cent. a year for 10 years. So the next time GATT is up for review, we shall start from a 27 per cent. tariff on exports to the United States.

The third issue was assisted area status. My hon. Friend the Member for Oldham, East and Saddleworth mentioned objective 2, but assisted area status has always had a bigger impact. In 1993, my city of Bradford had that status removed in order that Hastings, Yarmouth and places like that could get it. That had a massive impact on the possibility of helping textiles companies in temporary difficulties by giving them regional selective assistance. Many companies went to the wall that could have survived if they had received assistance for a temporary period. We want to live not in the past but in the future, but we need to know and understand how we got to the present position, so that the same mistakes are not made again.

I point out to my hon. Friend the Minister for Energy and Industry--who, as I said last month, was born in the same hospital as me--that we still face the problem that the Governments of Germany, Belgium and Italy are giving significant, illegal support to their textile industries. Either we take that illegal step, or we stop them taking it. I do not care which, but if our industry is to compete, it must do so on the same basis as theirs. In Germany, support is given through the lander, the local government, and is semi-hidden, but everybody knows it is going on. It is not fair; it is not right and it must stop.

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I support what my hon. Friend the Member for Oldham, East and Saddleworth said about the action plan for the industry. I hope that all sides in the industry seek to make that work. We need a much more focused effort on design, sales and marketing because our products are good, but other aspects have not always been as good. We need to sort out the supply chain and get all the links talking to each other so that they understand each other's needs and problems.

Our textile industry is a fine industry with superb products. We need to promote and sustain this £27 billion industry and its 350,000 jobs. We need not only to look to the future but to learn from the past.

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