Kali Mountford (Colne Valley): I am glad to have the opportunity to discuss such an important issue and I am grateful that so many hon. Members have turned out on such a cold and frosty morning to take part in the debate. Now is the right time to consider the new structure that was recently announced by my right hon. Friend the Secretary of State for Trade and Industry, as well as the changes that we anticipate will be made to grant support. The case for grant support is crucial to textiles and it is one to which I shall return.
We are in a post-Doha world and the matters arising from that are also crucial to the textile industry. What makes now a good time to review progress are the recommendations of the textile clothing strategy group. That group was formed in 1998 by the Department of Trade and Industry and it issued a draft consultation report in March 2000. Since then, it has produced other reports and its latest report that was issued earlier this year entitled "Making it Happen" is what we would like to see happen in the textile industry.
The Transport and General Workers Union plays a vital role in the development of textile strategy. I thank Peter Booth, a union representative, for his work and for the information that he has given me about the current state of the industry in preparation for today's debate. He told me that, at a recent TGWU conference, more than 90 per cent. of the textile delegates reported mill closures and job losses in the industry. Even at a time of rising employment, I am sure that we all agree that all job losses and mill closures are sad. We must examine closely the reasons why any industry starts to fail.
There have been job losses and mill closures in my constituency of Colne Valley. Within a week of one factory closing, however, a new purchaser was found for the factory and new jobs were introduced. Thanks to the help and support of the employment agencies, Kirklees council and Jobcentre Plus, each of those who worked in the mill were found jobs elsewhere. We could ask, "What is the problem?" For me, it is that the industry is still in decline. Last year's Red Book showed only two industries in declinerecession decline, not a slow down in growthtextiles and steel. That is important.
Textile production is still a major business in this country. It contributes 0.7 per cent. of gross domestic product, a fact that must not be ignored. People in the industry say, "If only we had the same voice as other manufacturers, we would be listened to." As it is, our textile producers are struggling, as are German and French textile producers. However, the Italian market is a completely different model. One of the TCSG's
Huddersfield's Textile Centre of Excellence is convinced that we can learn a lot from the Italians. It found the Italian manufacturers to be especially helpful and forthcoming. They say that the key to success is co-operation and collaboration within the industry. I despair of some mill owners in my constituency. I do not believe that they have the right frame of mind to be able to collaborate with others. A sense of isolationism and a bunker mentality persist in some sectors.
In Colne Valley, there is a wide range of textile producers, making knitted garments, frilly lacy things, haberdashery, heavy woollens and carpets. We have all the flavours of textile production. We also have the patriarchal background of the industry, which results in producers not talking to one another for fear of people finding out what their company is doing and how it is performing.
Happily, not all producers are wedded to the past and there are good stories to tell. However, some producers still resist trade union membership, and an attempt to get trade unions into some factories failed abysmally. There are those who do not want to fill in DTI forms because they find them too difficult; those who do not want anyone else to know the background to their business; those who still have looms and machines that were built in 1947 rather than 2002; and those who have not invested in new design or produced anything different in the past 50 years. For those producers, the future will be very grim indeed. The industry must adapt and change and the Government must be aware of how they can help the industry to do so.
Money can always help, but how it is spent is crucial. I cannot argue with the Government's investment of £80 million in the industry since 1997, or with the £8 million that was spent between 2001 and 2002 on market development, employment training, the supply chain, design skills, e-commerce and export support. All of that is good; but I question whether we have gone far enough.
The problem for many producers in Colne Valley is that many schemes apply only to certain areasin particular, to objective 1 and 2 areas. At present, Huddersfield's Textile Centre of Excellence is developing a local action plan. The centre needs to extend its premises, for which it has received £500,000 from Yorkshire Forward, the regional development agency, but it cannot go ahead because of state aid rules. Development in Colne Valley is being stymied. Many businesses in Colne Valley are in exactly the same position as businesses that are inside objective 1 and 2 areas. Their market conditions are the same; the conditions inside the companies are the same; the sort of help that they need is the same; and the population of workers is the same. However, they are outside the boundary and therefore not eligible for some of the support and help that is available to other companies. Producers feel that the system contains inequitiesinequities that have arisen because of the rules, so those rules will determine which businesses will survive and flourish and which will fail.
I wish to thank the Textile Centre of Excellence in Huddersfield, because it provides an excellent service to local companies by visiting them and helping to fill in the forms, but firms have ask for such help, and often there is a divorce between the help available and the mentality of producers who will not always seek it. Frankly, the system should not be so difficult in the first place.
I hope that the Minister will understand how textile businesses work and how difficult it has been for them during the current grant aid review. The industry seeks not only a level playing field in Europe, but throughout the world. Doha rightly points out that western industries cannot succeed by ensuring third-world failure, and I hope that we all accept that developing nations must be on an equal economic footing to be able to work their way out of poverty. It must therefore be right for British and other western industries to compete not on the lowest common denominator, but on quality.
If the industry is to be supported, however, artificial barriers must not be constructed against British textile exports. For example, in evidence from the International Monetary Fund to the Treasury Committee recently, we discovered that the United States applies for export barriers as if it were a third-world nation. One throws up one's arms in horror to think that the US considers itself to be a third-world country when it comes to export barriers. It cannot be right.
Huddersfield's Textile Centre of Excellence can provide a good model for the rest of the industry. It can show how we can move it forward into a new millennium, leave some traditional, backward-looking thinking behind and build a new and innovative industry. Yorkshire Forward has contributed a budget of £963, 000 over a two-year period. Not all of that will be spent in Huddersfield, but a large amount will be spent in west Yorkshire, as that is the base of the Yorkshire textile industry.
The Textile Centre of Excellence has a seven-point plan that builds on the proposals in "Making it Happen", a report produced by the TCSG, for which I am grateful. But there is a plethoraI have brought only a small number of them as an exampleof different reports and plans from different parts of the industry. Different organisations represent different bits of the industry that have grown over the years.
The firstand, from looking at the wide range of reports, the most essentialpart of the plan is to bring all of the strands together. The industry needs a single voice. Disparate and separate voices can cry lonely into
The second strand to the plan is to develop a Yorkshire label. We should be proud of the products that we sell, but I recently visited a factory with excellent quality woollen products that were being sold as Scottish. I am told that the wool came from Scottish sheep, so it can be argued that it was ethical, although there were some pretty good Yorkshire sheep grazing nearby. Nevertheless, the company preferred to sell its product as Scottish. That must be wrong. There is nothing wrong with the Scots being proud of their product, but why are Yorkshire producers not proud that their products are made in Huddersfield or Yorkshire? It is something that we must change. If we are not prepared to go out in the rest of the world and to be proud of the product that we are selling, why should the rest of world be proud to buy it?
Mr. Archy Kirkwood (Roxburgh and Berwickshire): I agree with the hon. Lady, who makes the point eloquently. That is true within various parts of the United Kingdom, but it is also true of international intellectual property rights. Perhaps the Department could spend a little time ensuring that those rights, which exist throughout various parts of the United Kingdom industry, are protected globally.
Kali Mountford : The hon. Gentleman makes an excellent point that I could illustrate by describing a movement from woollens to technical textiles in my constituency. A manufacturer succeeded in registering a product but because of market conditions and because it required investment in new machinery and meant applying for grants, the owner decided to close the business. I was particularly concerned when his son took it to Africa. I do not object to the growth of businesses in Africa, but the new product could have been developed and made in Britain. The productit is called Leospring; look out for it because it is excellentcould one day change how we address ecological problems, such as oil spills, and it does not produce smoke, so imagine the difference that it could make if it were woven into the seat coverings of planes. It is an outstanding technical advance for textiles, and we have lost out because it will not be made in Britain. I hope that the product will be made one day because it will give advantages to us all, but it is a real pity that it could not be made in Britain.
That leads to the third strand of the plan, which is skills development, because we could not invent or produce such fantastic products as Leospring without skills. However, there are several gaps in the development of skills in the textiles industry. The Government have invested £2 million in strategic training for the apparel and textiles project. That project was widely welcomed but it ended in June this year. Many organisations, including the TGWU, are calling for an extension of the STAT project. However, in Huddersfield at least, there has been a response to fill the
We cannot continue to be backward looking. If any hon. Members present were to visit a local textile business, they would find that many people working there would be over 40 or, in many cases, over 50. It is very difficult to find any 20 to 30-year-olds working in mills. However, I am pleased that young people are now coming straight from school to train in the field and that there are new links with universities. There was a time when universities withdrew their training courses in textiles. There is now a development of links between the local university and the centre of excellence to provide degree-level courses, which must be right.
That brings me to the futures programme, which is the fourth part of the plan. The Department of Trade and Industry has agreed in principleso I hope that it is not improper to say this nowto give £309,000 to a scheme that will cover west Yorkshire, the north-west, the north-east, the east midlands and Scotland. The scheme will allow companies to be selected for a one-year programme during which they will receive the expert advice that they need but cannot usually afford. People from the companies will attend seminars with experts at least once a quarter in order to receive the advice and mentoring that they need to keep their businesses on track and up to date. Additionally, grants of between £15,000 and £20,000 are available as cash for participating companies to help them to develop and grow. The object of the plan is to take companies out of the past, and to encourage a movement away from old-fashioned practices and toward the use of modern production techniques. That will secure the future of the industry.
The fifth and most exciting part of the plan is the incubator unit. A thousand fashion and design students graduate each year in our area20 per cent. of the United Kingdom total. Hardly any of those graduates stay in Yorkshire; most of them go to London, or go abroad. The centre is now working with the universities and is helping graduates to create their own start-up businesses.
Too many of the catwalk shows have featured quite mad designs that no normal person would want to wear, with models walking down the catwalk wrapped up like Christmas turkeys. We want to buy well-tailored, well-designed, wearable clothing, in which we can go to work and in which we feel comfortable when we go out in the evening. We do not want clothes in which we would feel uncomfortable even when sitting down. We need designers who stay close to producers and work with them to produce a synergy between good quality cloth and good quality design. Accordingly, the centre provides work space, help with portfolios and the technology with which to produce computer-aided designs. The centre intends, through the use of local market intelligence, to set up 12 companies each year. Those could grow design and fashion knowledge that is useful to the industry and create a local outlet for the
The centre is also part of the manufacturing leadership programme, which is developing qualifications in manufacturing to degree level. That is not specifically an innovation of the textile industry. It is important for the textiles industry that students understand that manufacturing is a business and that they develop the leadership skills that are needed by all manufacturers. I would recommend that programme to anyone from Yorkshire who is listening. My copy of that programme shows that each faculty should work with the universities and with companies to develop the leadership skills that are obviously needed and to break out of the bunker mentality that we have been used to. The industry is also a significant consumer of energy and it has found it difficult to respond to demands for reduced energy consumption. The industry does not want to be anti-ecology, but it finds the climate change levy particularly onerous.
I have in my hand a note from the Textile Services Association, which is a vital part of the industry. The industry uses a lot of energy and water, from the beginning of the production process, in all its component parts, including laundering, right up to the end. The industry also uses many chemicals in its production processes and it is right to try to control the effects of production on the local ecology. It can, however, be costly for a producer if it has worked hard to reduce its energy consumption but cannot recoup any of the costs through national insurance contributions. The Textile Services Association will attest to that. The centre of excellence, however, tells me that it has been able to help in many cases and has shown some factories how to reduce both consumption and production costs. Much has been learned, but there is still a lot more to do.
The Textile Centre of Excellence has £160,000 to spend in the region to show companies how to respond to the climate change levy. Companies tell me that they are finding it difficult to save money, but the centre says that it can help. The levy needs closer consideration and it should look at it in more detail, so that we can help companies through a period in which we expect them to adjust.
Yorkshire Forward has made available just £150,000 for innovation, and £80,000 has already been allocated to one company, but at least that money is being made available. I have already mentioned the product called Leospring, which, sadly, Huddersfield lost. Such products must be given some support if we are to develop them. If there is to be innovation, there must be support, otherwise there will be a sad lack of innovative products in our country.
I discussed the future of textiles with Bill Macbeth, the outstanding managing director of the Huddersfield Textile Centre of Excellence. Hon. Members can tell from my speech how much I admire the work of that body. Bill Macbeth says that we must change our attitude to textiles. He has certainly inspired me. He says that textiles is a sexy industry. I was not sure whether I would be allowed to say that, but I have done so now. That sexy industryI think that I would prefer to call it excitingshould be forward looking. If the industry drags its heels, and comes kicking and screaming into this millennium, its future will be bleak. However, if the
Mr. David Tredinnick (Bosworth): I congratulate the hon. Member for Colne Valley (Kali Mountford) on securing the debate and on speaking so eloquently in defence of a beleaguered industry. She must have read Hansard before she became a Member of Parliament, because her predecessor, Graham Riddick, was a great champion of the industry, too.
I am interested to hear that the hon. Lady regards the industry as sexy. When I first went to Hinckley in my constituency in 1987, I was invited to attend the "Hinckley Makes It" show, and I was somewhat surprised to see some of the ladies from the factory modelling the local products. I expressed my surprise to the organiser of the show, a lovely man who played a great part in the local industry, Mr. Bill Randells, and he said, "David, you must understand; Hinckley makes progressive underwear." I am not sure what should be read into that.
The Government's approach to hosiery, knitwear and textiles closely mirrors the No. 10 press officeboth are totally out of control. I shall not indulge in a lot of corny puns on spin and spinning, but if ever there was an industry to which the maxim of all spin and no delivery should be applied, it is this one. I see the Minister smiling and moving around in his seat; perhaps he is feeling uneasy. He must know, in his heart of hearts, that the Government promised so much for the industry when they came to power, and they have done so little.
I am entertained to know that I am speaking before the cashmere kids. I had never heard that term before, and I did not realise that the cashmere industry had an informal group dedicated to its support that goes by that name.
I represent a famous hosiery and knitwear town in the east midlands, Hinckley, which at one time had 150 factories. It used to have perhaps the highest income per family in Europe, because all the ladies of the town worked in the factories, and many of the men crossed the Watling street boundary into the west midlands to work in the car industry. The textile industry is still thought of as a key industry in Hinckley and the east midlands, but it has suffered grievously. The hon.
Mr. Tredinnick : It is an old technique of parties in Government to try to blame previous Governments for their own misfortune, but one would have thought that a Government who have been in power since 1997 could do better than merely blame the previous Tory Government, because the fact is that they have done next to nothing for this industry.
There have been many reports; there is another one this year. Fludes is a factory in my constituency. The Secretary of State, the right hon. Member for Leicester, West (Ms Hewitt), paid a surprise visit to Fludes, a factory in my constituency, to help to promote the innovative socks that it is making for travellers who might suffer from deep-vein thrombosis. [Interruption.] I am not so uncharitable that I will not also mention the hon. Member for Leicester, East (Keith Vaz), even though he does not represent my party. During the visit to Fludes, the managing director of the factory said that the Government put all the emphasis on the relocation of employees after they have lost their jobs. They are backing other industries, and nothing is being done to keep the jobs that exist in this industry, which is why we are seeing this catastrophic decline. The industry is in a very serious situation.
The hon. Member for Colne Valley mentioned the export of jobs. When Pex in my constituency shut down, the idea was that all the equipment would go to Romania. We are suffering from an export of jobs. One of the reasons for that is that it is almost impossible for companies to reinvestto bring in the new machinery that the hon. Lady so eloquently said that they needbecause they are not receiving any help from the Treasury. It also provided absolutely no help to the Textile Services Association when it made representations about the climate change levy. The association said:
The industry must get added value for products: that is the way forward for it, but to achieve that it will need more equipment. Some companies in Hinckley, such as Davenports, have made great efforts to bring in new equipment at great expensewithout any help from the Treasuryso that they can compete with the Italians, who are very effective. That is how the industry can move forwardby adding value.
Some companies in Hinckley are now having to outwork in China. They make some products there, and then bring them back and re-label them. It is regrettable that that has been the way forward for some companies, but at least they are still in business.
Courses at North Warwickshire and Hinckley college have been shut down: the ones that used to train the mechanics who maintain the equipment have gone during the tenure of this Government. The overriding problem is that too much emphasis is put on helping those who are leaving the industry, and not enough is put on helping those who are in the industry and who want to stay in it, and on creating new jobs.
Judy Mallaber (Amber Valley): I am very disappointed by the contribution of the hon. Member for Bosworth (Mr. Tredinnick). I had no intention of getting into a party political debate; the situation is too serious for that.
When the Conservatives were in government, half a million jobs were lost in the industry and no action was taken to bring the parts of the industry together to try to develop a strategy for the future. We are going through a period of incredible globalisation and industrial changea new industrial revolution. I will come back to that point.
Yesterday, I spoke with Julian Ellis, who chairs the group under the east Midlands regional organisation that looks after the technical textile sector for the industry. He said that the Government could not be doing more, and that it is now up to the firms in that sector to take action. We are going through great difficulties, and now is not the time to talk about party political issues. The textile and clothing strategy group was set up precisely because, after 1997, Ministers talked to different sides of the industry and said, "We cannot tell you what to do. Please come together and tell us what you need and your recommendations for where the industry should go." I hoped that the hon. Gentleman would at least recognise that, because I wanted to start by paying tribute to the group's work. It is a model partnership between trade unions, employers, trade associations and academics working with, and supported by, the Government.
As I said, we have many difficulties. We face a global problem and a change in the operation of the industry. It is the job of those participating in this debate and those of us in the all-party group to stress that the industry has a future. That was one of our main purposes, in addition to ensuring that we had a national strategy and that action would be taken on its recommendations. That is why we are here today.
The industry is still important. As my hon. Friend the Member for Colne Valley (Kali Mountford) said, it still accounts for 0.78 per cent. of gross domestic product, £15 billion in sales and £6.5 billion in exports, and it employs 250,000 people, so it is still a key player in this country. However, the industry does not have the profile that it should have, and part of our job is to ensure that it has that profile.
The industry is having an incredibly difficult time. Some 75,000 people work in the industry in the east midlands, and there are 2,500 companies, but we have lost 20,000 jobs in the past 10 years and we lost many more before then. We recognise those problems: I believe that the constituency of every hon. Member present has experienced pain as a result of those difficulties. We are going through a relentless globalisation process, and it is very difficult to compete internationally. We must consider those areas where we can still compete and find new ways of competing, new products and new sections of the industry. We face competition and the removal of tariffs, which is a very hard process.
This Thursday, I hope to attend a farewell function for many of the people who are to lose their jobs at a Richard Roberts factory, which is just up the road from where I live. It is a former Charnos factory, and the factory manager lives just a few doors down from me. The hon. Member for Bosworth spoke about the help that is given to people who lose their jobs. Like my hon. Friend the Member for Colne Valley, I pay tribute to the work that Jobcentre Plus has done, because most people from the factory have managed to find new jobs.
Interestingly, the only factory that Richard Roberts maintains in the region is the one with a niche marketthe firm in Kirkby in Ashfield that makes cashmere products that are sold to Saks Fifth Avenue. That is the only factory where the company can maintain a high-value product in this country and still compete. This is a serious problem: how can we transfer to new areas, where competition can still exist?
Many of the traumas in my constituency came with the job losses at Coats Viyella. In September 2000, we lost 5,000 jobs across the region, which caused us serious trauma. A major economic driver in my area over the next few years will be the development of the world heritage site in the Derwent valley. Ironically, that was the heart of where the Arkwright and Strutt mills were
Technical textiles are a particularly important sector and we should recognise that we are world leaders in it. I have recently had the sad job of talking to people who are losing their jobs in one traditional part of the industry that has been unable to compete. By contrast, last weekend I went to see the latest James Bond movie: Nottingham university was consulted about the Aston Martin car's amazing trick of turning over a million times on the ice. A technical process within the textiles industrya 3-d braiding processwas used to create and strengthen parts in the chassis of Bond's high-performance car. That lies behind the thrills and spills of the James Bond movie and highlights the important work of our local university. One hopes that the process will be used in other cars to make them safer.
Mr. Michael Moore (Tweeddale, Ettrick and Lauderdale): Will the hon. Lady acknowledge the great promotional tool of the latest Bond movie for the entire textile sector, recalling that the cashmere sweater worn by Bond comes from Ballantyne of Innerleithen?
Judy Mallaber : I will certainly acknowledge that. Yet another aspect of that enjoyable movie is that it features a female spy who is as good as James Bondand the baddie came from the east midlands, too. The movie is good for demonstrating many things.
Staying with cars, when I first visited Advanced Composites in my constituency, I was amazed to hear that all its material for Formula 1 cars was textile-based. I found it hard to believe, but that is indeed the case, and it shows another important application of the textiles industry.
I mentioned earlier the chairman of the group of technical textiles companies in the east midlands. Those companies are involved in the production of surgical implants, which utilises historic embroidery techniques. His company is also taking part in a £1 million Government-funded project examining urinary incontinence: it is producing a collapsible tract to be inserted into people's bladders to facilitate the use of cathetersyet another example of extraordinary and amazing developments from technical textiles. As I said earlier, the company felt that the Government were providing help through the TCSG. Will the Minister give an assurance that continued funding will be available to that important sector, which should not be allowed to fall short because of lack of investment?
Many positive developments are taking place within the industry, but I have some questions about how best to implement the recommendations in the report. People in the industry have asked me to put some questions to Ministers. First, the relaxation of the three-times rule is welcome, but what action is being taken to
Secondly, on public procurement, the Government have been seeking to make the rules more beneficial to British companies. However, all too often there is a feeling that price rather than quality is being consideredI have been given the example of blankets provided for our troops by the MOD. There is also a question of transparency in the tender process in this industry and elsewhere. People do not know, for example, how to get on to the approved list for tenders.
The subject of my third questionthe STAT programmewas referred to by my hon. Friend the Member for Colne Valley. I am delighted that the industry has done so well in achieving trailblazer status for the sector skills council. That is a great tribute to the work done by partners in the industry, but we still want the STAT programme to be continued. It could be a model for other industries; it is employer-based and has enabled companies to work with business advisers to establish their training needs rather than having to adapt their training to the courses available. Some 91 companies have benefited; 1,800 jobs have been secured, 2,500 employees have new skills, and new jobs were created in 41 per cent. of the companies involved.
I would be pleased if the Minister could clarify the follow-up scheme. I tabled questions to the three relevant Departments, and was disappointed that one of themnot the Minister'stold me that we did not need the STAT programme now that we had the sector skills council. The reality is quite the reverse: the council needs to be able to promote and develop this flexible programme. I would also like the Minister to give a commitment on its funding
I have also been asked what happened to the designer study. Earlier this year at London fashion week, which I attended, the Secretary of State for Trade and Industry launched a study of the fashion design sector and its impact on the wider textiles and clothing industry. Is that being taken forward, and what help is available for it?
The Minister responsible for the textiles and clothing industry recently re-launched the second phase of the designer forum in Nottingham in the east midlands, which provides facilities and information for designers on fashion trends, start-up units, incubator units and so on. It would be helpful to know how that ties in with the study that Ministers are conducting.
On my next point, I understand that the joint industry fashion team was a Treasury initiative to encourage and help companies to move from the informal economy into the formal economy, and to let them know that they would not be closed down because of previous problems of taxation or the minimum wage. The Evening Standard has reported recently on how Arcadiaa company that has been very involved in Government projects in the industrywas found to have been taking goods produced in sweatshops by workers receiving less than the minimum wage. The initiative is therefore very important.
Stevensons raised with me the difficulty of ensuring coherence in the programmes that we are developing in our regions and hoped that the strategy developed by the clothing and textiles group would be taken forward. A considerable amount of work is now being done in my region and in that of my hon. Friend the Member for Colne Valley to set up structures to co-ordinate the work that is being done in the industry. However, it can still be confusing for companies in the region to work out exactly how they access that help, and it is important that we provide that information.
I shall end with an example that illustrates the need to take the industry forward. The person who chairs the east midlands cluster within the region runs a company called Swiss Tour, which manufactures specialised netting, from mosquito nets to parachute lining. It even produces netting that can block mobile phone calls and other wonderful things. Interestingly, that technology has been developed from Nottingham's old lace-making machines, which were invented two centuries ago to replace hand lace making. The problem is how to move on from traditional manufacturing while keeping as much of it as we can. I agree with the hon. Member for Bosworth that that means not just giving assistance to those who lose their jobs, however important that is, but also seeing what can be done to make companies move into new niche markets and areas where they can compete. We can assist them in that, but we also need to keep our eye on the current industrial revolution, which can take us into a new sector in the future. It will probably not be called "textiles". The technical textiles people are setting up their own trade association. It is doubtful that people will realise that many of the products are based on textiles technology, but that is how the industry is developing. There is a huge amount of work to do and a painful process to go through. I hope that the Minister can deal with some of the points that I have raised.
Mr. Michael Moore (Tweeddale, Ettrick and Lauderdale): This has been an important debate and I congratulate the hon. Member for Colne Valley (Kali Mountford), my colleague on the all-party group on clothing, textiles and footwear, on securing it. I pay tribute to the hon. Lady for the work that she does on the Committee and to the hon. Member for Amber Valley (Judy Mallaber), whose chairmanship of the group makes it highly effective. The hon. Lady has kept us focused on the activities of the textile sector for the past few years.
I am glad that the Minister is in his place. He dubbed my hon. Friend the Member for Roxburgh and Berwickshire (Mr. Kirkwood) and I the cashmere kids, I presume on the basis of the work that we did during the
For all the pessimism that exists in the textile sector, it remains one of Britain's strongest manufacturing sectors, especially in my constituency. It is a vibrant sector that needs to succeed and I believe that it will do so, through innovation and by enhancing its competitiveness. There is no doubt that the textile industry has a future. I worry that in the House and in other forums we are tempted to talk the industry down and look for problems, which are self-evident and present in most manufacturing sectors. The textiles industry still has a huge impact on the economy and without it south-east Scotland and the borders would be in great difficulty.
The main aspects of the textile sector, be they knitwear apparel, weaving or technical textiles, are represented within south-east Scotland. Each of them has seen huge changes in recent years. Over decades, the nature of the competition faced by individual companies in the United Kingdom, especially from overseas, has changed out of all recognition. Inevitably, that means that regardless of the state of the world economy or particular parts of it, the sector will always be subject to the buffetings of the world economy with the extreme competitiveness that that introduces. Globalisation may be a reasonably recent concern for people across the world, but the textile sector has coped with it for a hundred years or more. We must not shy away from the challenges that it faces, nor should we worry that the only route is downwards.
The marketplace has changed. That has been noticeable in many of the products that are produced in my constituency. There has been a shift in recent years towards the different niches of the market. For example, the cashmere sector has moved to the high fashion end of the market. As a recent local trade publication put it, borders manufacturers no longer sell just gold button cardigans and twin sets. I take slight issue with the hon. Member for Colne Valley, who talked about the catwalk and asked whether it was relevant to everyday people. It is relevant in that it shows how design and innovation is increasingly important for British companies, particularly those that I represent. It may not be the stuff that anyone here might want to or could wear, but it shows what the industry can do and it spills out into the more mainstream markets that we see as important commercially and otherwise.
Kali Mountford : Does the hon. Gentleman recall the sort of catwalk shows that there were in the past? One of my favourite designers was Paul Costelloe, whose fine tailoring was very innovative. It may have been a little extreme for the average person, but it was wearable
Mr. Moore : I am getting a little out of my depth as a fashion consultant or guru. I defer to the hon. Lady's greater expertise. It is important that the industry shows off the best of its potential in whatever sector. I hope that it will continue to do so. My constituency does not just produce high fashion cashmere. We also produce goods in a diverse range of fields. One small manufacturer, Robert Noble and Replin Fabrics, makes aircraft seat and carpet fabrics that go into Boeing jets throughout the world. Too few people in the borders understand that, let alone elsewhere. It is a good example of a small company that has diversified and is reaping the rewards as a result.
My hon. Friend the Member for Roxburgh and Berwickshire and I recently carried out a survey of local manufacturers, and the textile sector obviously featured heavily. The techniques that manufacturers have to adopt nowadays range widely across the spectrum. Some seem still to be living in a 19th century museum but others are state of the art and software driven and are unrecognisable from earlier days. Each company has its niche and each has its expertise, and the importance of investment for all of them needs to be stressed.
One of the key issues facing all of these local businesses, regardless of their sector or their manufacturing base, is the need to encourage young people into the industry. The skills shortage in the textile sector is massive. A recent report in the borders entitled "Where are the young people?" put its finger on the dangers facing the local industry. It will not run out of customers or struggle with cash flows: it will have no one to employ. That goes back to the point with which I started. Part of the difficulty is not that there are no young people, although that is an increasing problem in the borders, but that they do not like the image of the industry. They are not happy with the one that is portrayed in public. All of us here and elsewhere have a responsibility not to talk the industry down, but to promote it so that young people and others can see a viable future in it for themselves.
Further applications for research and development will ensure success in the future. Heriot-Watt university in my constituency successfully took part in the Faraday partnerships. It has undertaken much research that, it must be hoped, will be recognised for its academic excellence and will spin out into industry. It is clear from the university's recent briefings that the work that it is doing is highly respected. My anxiety, however, is that it does not generate the spin-offs of new jobs and new markets for businesses in the borders and elsewhere in Scotland. So far, that is the missing link in the partnership, and I hope that the Government will encourage Heriot-Watt university and others to work more proactively to ensure that there are local spin-offs from the excellent work that they are doing.
Time is running short, but I return to the point to which I referred obliquely. I draw the Minister's attention to the importance of world trade to the industry, and to the need for fair rules of competition. We all acknowledge that the multi-fibre arrangement is
Dr. Vincent Cable (Twickenham): I congratulate the hon. Member for Colne Valley (Kali Mountford), who made an effective case for her constituents. It was also heart-warmingly positive, forward looking and outward lookingnot the face of the textile industry that I have experienced. In the 1970s and early 1980s, I worked with developing-country negotiators to try to help them to receive better quota treatment under the multi-fibre arrangement. In those days, the face of the British textile industry was very different; it was defensive, inward looking, and obsessed by external competition and by building barriers to it. Courtaulds and Carrington Viyella were investing heavily in upstream weaving and spinning and in trying to secure quotas to protect their industry. The face that the hon. Lady presented today was altogether more positive and forward looking, which I appreciate.
The hon. Lady and other speakers helpfully highlighted the extent to which we are dealing with a diverse industry. We can argue that the textile industry is, in a sense, merely a lobbying group. It is very diverse with very different sets of problems. There is an enormous difference between, for example, upstream spinning and weaving, which is capital intensive, and the garment makers.
The knitwear industry is a different story; Members representing the east midlands and the Scottish borders spoke about its importance. Even in that industry, the knitwear producers are very protective of their sub-industries. The people who make socks and stockings have little to do with the people who knit garments and who use different technologies and materials. In view of such diversity, it is useful for us to remind ourselves, as several hon. Members have done, that it is not all doom and gloom.
There are some very positive stories in "the industry". The hon. Member for Amber Valley (Judy Mallaber) reminded us of the success of industrial textiles, especially household furnishings. Many people in niche markets in the garment sector, which 20 years ago seemed a hopeless case, are doing very well. My hon. Friend the Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore) rightly reminded us how innovative and successful Scottish producers in the cashmere sector are proving to be. They are using new designs, new technologies and better materials, which is how we should view the industry.
The same applies to the communities. As a teenager, I went round the West Riding playing and watching football and rugby league. It was often depressing going to towns such as Batley and Halifax, but they are now
The figures clearly show that the textile industry is in relative decline. That is nothing new; it has been in relative decline for 150 years. However, that is not surprising because it was the industry that led the industrial revolution. It has been declining relative to the economy as a whole and relative to manufacturing, while other industries have gradually replaced it.
Over the past few years the contraction of output has speeded up. This is not to apportion blame, but that contraction is probably because of the exchange rate as much as anything else. When the exchange rate has appreciated by roughly 25 per cent. in real terms since the mid 1990s, and when many parts of the industry are concerned with competition in exports and imports, and are very price-sensitive, prices and the exchange rate will clearly be important. I suspect that the exchange rate is the factor that most explains the increase in the pressures of competition on the industry. However, even if that exchange rate factor did not exist, globalisation would still be a factor bringing its own pressures, as the hon. Member for Amber Valley reminded us.
I wish to discuss two policy issues. The first concerns trade policy. There is now consensus that the MFA has to be phased out. However, it is worth while reminding ourselves what a pervasive influence trade protection has had in the textile industry. That goes back a long way. Those who know their economic history will know that the first big industrial riots in London took place at the end of the 17th century just before the reign of Queen Anne. The riots were over textile imports. The whole of Whitehall was burned to the ground by rioting workers demanding controls on calico imports from India. People protested about the unfairness of so-called coolie labourcheap labour. They demanded, and got, quotas. That remained the nature of British industry for many decades, only dying out for technological reasons.
We have had quota protection in British industry since the early 1960s. The long-term agreement became the multi-fibre arrangement in 1974. We were told that that was temporary and that only a few years were needed to get the house in order. Then, in 1979, it was multi-fibre arrangement 2, and things were extended and extended. It is worth while remembering how unbelievably complex the system is. Apart from the common agricultural policy, it is the most complex system of managing trade in the world. There are hundreds of clauses for hundreds of countries and categories of products. Indeed, apart from Gosplan, it is the most managed system of international trade that has ever existed, and it is right that it should go. The lesson has been that, when trade is protected, as in the MFA, it is very difficult to get rid of it. Moreover, in the long run it does not work. All the efforts that have gone into protecting the textile industry in rich countries ultimately turn out to be futile. There have been many successful companies but they are not in the sectors that were protected against import competition. The exercise was largely futile and immensely costly. I hope that the Minister will confirm that the Government are committed to working towards the phasing out of the arrangement. I understand that the commitment is to
As my hon. Friend the Member for Tweeddale, Ettrick and Lauderdale pointed out, elements of genuine unfairness remain. There are problems with dumping and a lack of reciprocity, especially with the United States. It is right that the Government should be vigilant on those issues.
The second policy issue that I wish to discuss concerns industrial assistance. What is the most sensible and helpful way in which the Government can help an industry that is trying to adapt in difficult circumstances? There are basically two ways. The first is through subsidies and industrial assistance. A lot of money has gone into the textile industry. I think that about £100 million has gone in during the past 10 years, and an awful lot more went into Lancashire and Yorkshire textiles in the 1970s. I am sceptical about the value of that assistance and I should be interested to hear any evaluation that has been made of the outcome. However, I welcome the more useful, subtle and forward-looking approach adopted in the 12-point programme. Those measures are extremely well thought through, sensible and business oriented. They bring the industry together in a sensible way and I commend the people who put the programme together. It is the way in which a forward-looking and outward-looking industry can prosper.
Mr. Henry Bellingham (North-West Norfolk): I congratulate the hon. Member for Colne Valley (Kali Mountford) on initiating the debate and on her well thought out and extremely impressive contribution. She described the decline that the industry has faced, which has been relentless. In the past 10 years, whereas the growth rate in all industries has been plus 2.1 per cent., the growth rate in the textile industry has been minus 3.2 per cent. That has obviously been reflected in the number of jobs and the balance of trade. We have seen substantial decline.
The hon. Member for Amber Valley (Judy Mallaber) mentioned globalisation, but I was pleased with the amount of positive talk about the future in the debate and how we can move forward with hope. One of the biggest problems has been companies and manufacturers sourcing products abroad. More such sourcing abroad of the lower value, high volume goodssuch as trainers and jeansis inevitable. Companies have moved production to China, Africa and the sub-continent. Dr. Martens recently announced the loss of 2,000 jobs, which is devastating for the communities that supplied the labour for its factories.
The ladies' cardigan manufacturer, Dewhirst corporate clothing, announced the loss of 350 jobs last summer when it closed its plant and relocated to Morocco. An especially poignant and brutal truth was brought home to the workers in that factory because they were sent out to Morocco to help set up the factory and train the staff there. They then saw their own jobs exported.
We should examine what the Government have done. My hon. Friend the Member for Bosworth (Mr. Tredinnick) was critical and talked about the lack of any determined, meaningful or clear strategy by the Government, but we should look at what they have done. The Opposition welcomed the textile and clothing strategy group report and the Government's response to it. We also welcomed the updated response that was published a year ago.
The hon. Member for Amber Valley mentioned recommendation 19 and the suspension of the three-times rule for support to companies attending trade fairs, which is vital. I hope that the Minister will tell us what the Government will do to make matters easier on that front.
Recommendation 37 relates to the progress of the new centre of excellence and the need for it to be monitored closely and for its success to be built on. Will the Minister tell us what is happening about that? Recommendation 40 was that the Department of Trade and Industry should establish a flexible fund to support individual companies that undertake small-scale innovation and development work. That is very important, so will the Minister give us an idea of what the Government have done about that recommendation?
I am worried that although we have had a period of buoyant economic conditions and economic growth, manufacturing is undoubtedly in severe recession. It will become even more important for the Government to examine the recommendations and to ensure that they put in place anything that they can within their remit and resources.
There are other areas in which even if the industry is asking for too much positive help, the Government must not hinder it. The hon. Member for Amber Valley mentioned procurement, and I believe that the Government have positively hindered the industry through their procurement policies. I know that this is outside the Minister's remit, but there was mention of the procurement of Army blankets from abroad. Six months ago, an order for boots and uniforms was sent to a German manufacturer. I am aware of the EU
Several hon. Members mentioned the climate change levy. I entirely agree with a point made about the Textile Services Association because the key question relating to the climate change levy is whether manufacturers can recoup the money through national insurance contribution reductions. If the answer is no, the Government should take action. Perhaps we should consider moving forward for such cases with an emissions trading scheme, which has been popular and successful on the continent.
Some burdens and pieces of red tape, such as EU directives and regulations, are outside the Government's control. However, the Government have been driving forward several pieces of social legislation. I do not claim for a moment that each burden and extra pressure will be a show stopper, but we hear from every single trade association in every single industry that the combined weight of the burdens on business is making life much more difficult.
During last week and the week before that, we considered two statutory instruments arising from the Employment Act 2002. One related to maternity and paternity pay after adoption, which Conservatives Members support, but last week we considered a statutory instrument on flexible contracts, which gives all employees the right to demand a flexible contract if they have a child under six or a disabled child under 18. That might not worry a larger firm but many small firms in the textiles sector will find it difficult to cope with demands from perhaps five out of 10 employees for a flexible contract. The employees might deserve a flexible contract but if firms are trying to meet an order in the run up to Christmas or another especially busy time, the smaller firms will suffer every time.
Smaller firms, especially, will also suffer from the agency workers directive. To be fair to the Government, they have done their best to resist and water down the directive. However, the directive will almost certainly go through. It has been passed by the European Parliament and it is now before the Council of Ministers. It will give agency workersor tempsthe right to demand a full contract. In fact, the European Parliament insisted that that right should exist after day one, but I know that the Council of Ministers is confident that it can extend the period to six weeks. However, even a six-week period will affect many agency workers. They will have the right to demand parity. It is sometimes easy to justify paying a temp as much as an employee on a full contract. However, there will be plenty of situations in which a temporary member of staff does not have the same experience or skills and who does not qualify in any circumstances for the same level of pay. Many people who work as temps are highly skilled and qualified. They do not want such contractual rights, nor do the employers. I urge the Minister to resist the directive. I know that his socialist colleagues in the European Parliament have voted it through, but I hope that hon. Members who know Labour Members of the European Parliament will talk to them about the damage that the directive will do to business.
The Government must look carefully at those areas within their responsibility that they can control and relieve some of the burdens and red tape. We can then look forward to a bright future. The key to such a framework is that the Government deliver upon it. I hope that the Minister will give us some hope in that direction this morning.
The Minister for Energy and Construction (Mr. Brian Wilson) : I add my congratulations, Mr. Cook, to those that have already been expressed to my hon. Friend the Member for Colne Valley (Kali Mountford) for initiating a debate on such an important industry. The subject certainly deserves an airing in Parliament. It is particularly welcome that she looked on the positive side of the industry. In fact, the whole tone of the debate has been positive, whereas so often in the past it has been a procession of doom and gloom. I come to the debate as a late substitute, but I have a long-standing interest in the industry and it is good to renew my acquaintance with such issues. When innocently fumbling with my tie earlier, I was relieved to find that it was made in Nottingham. I was surprised about that; it is my fig leaf for today.
It is worth bearing in mind that the textile industry is not a piece of industrial archaeology. It contributes 0.8 per cent. of GDP; it accounts for £15 billion in sales and it employs about 250,000 people. It is interesting that exports last year were to the tune of more than £7 billion. The hon. Member for Twickenham (Dr. Cable) made good points about the history of protectionism in the industry, but the other side of the coineven in current circumstancesis that we sell £7 billion worth of goods from that sector overseas. It is the old story that protectionism cuts both ways and we need such markets just as other economies need our market. That is why my Department is committed to working with such an important and dynamic sector and helping it to remain competitive, both domestically and globally.
For the first time in a generation, there is an industry-led national strategy for the future of the sector, which has been drawn up by the textile clothing strategy group. It was established in 1999 to examine the major issues affecting the textile and clothing industry, and to identify actions that would improve its viability and competitiveness. The report was launched in June 2000. It contained several recommendations aimed at the industry and the Government to help the sector meet the global challenges that it faces. Since then, we have expanded our effort to address all the recommendations in the TCSG's strategy that called for action by the Government alone or the Government in partnership with the industry.
The group's follow-up report "Making it Happen", which was launched in July this year, records the actions taken by the Government and the industry to help United Kingdom textile and clothing manufacturers compete more successfully. They include £1.5 million towards a £3.8 million textiles and clothing industry forum programme, developing projects to promote world-class best practice to improve the performance of the industry throughout the entire supply chain; £2 million support to target retraining for the industry through the strategic training for an apparel textiles programme, with a follow-on programme now in the
Mr. Deputy Speaker [Mr. Frank Cook] : Order. I have allowed two such references to me; I cannot allow a third. When establishing this parallel Chamber, the House decided that the four senior Chairmen of the Chairmen's Panel should , while occupying the Chair, be addressed as Mr. Deputy Speaker.
My hon. Friend the Member for Colne Valley and the spokesman for the official Opposition asked about what had happened to the study of the comparison with the Italian industry. That is an interesting and important line of inquiry because Italy is not a third-world country that pays knock-down wages, and yet it has extremely successful textile, clothing and footwear industries. The TCSG identified that important lessons could be learned from studying that industry, and the Department of Trade and Industry has undertaken a comparative study of the UK and Italian textile and clothing industries. The initial findings of that will be made available in the new year. The principal focus of the research has been on wool and worsted fabrics and men's suits, which are important for the UK industry and with regard to which Italian manufacturers have been particularly successful. When it is completed, the study and its conclusions will be widely disseminated to the industry.
I was interested by the comments on public procurement. The Government cannot pursue a buy British policy. They must observe European Union rules and Treasury value-for-money guidelines. However, I emphasise that value for money is not the same as cheapest is best, and although we recognise that there is a legal framework and that there are inhibitions on a buy British policy, there is also scope to work within that frameworkparticularly on the basis of value-for-money criteriato help the UK textile and clothing companies to compete better in tendering for public service contracts. Value for money must be the key criterion, but that does not necessarily mean that one looks for the lowest price all the time.
Technical textiles are one part of the industry that is booming. As my hon. Friend the Member for Amber Valley (Judy Mallaber) said, a significant factor in its growth is the increasing use of textiles in industrial applications that were originally the province of metals and plastics and of the automotive, aviation, construction, defence, health care, information technology and other industries. I will not list the various amounts of money that are going into this, but it adds up to a very significant contribution, and it is forging links with sectors such as higher education and research and training organisations. The Faraday partnerships are one of the routes through which that money can be channelled.
The hon. Member for Bosworth (Mr. Tredinnick) said that the Government were entirely responsible for the decline of this industry. That is one of the most absurd statements that we will hear this weekor any week. Classically, the textile industry has been subject to the forces of globalisation. The historical analysis of the
That leads on to the point that was made by the hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore). He generously referred to my role with regard to the cashmere industry. I enjoyed that: I found it interesting, and it was ultimately rewarding because of the outcomes that were achieved. Anyone who was to look at what has happened in that industry as a micro-example of what can be done in the industry in general would learn many lessons.
The cashmere industry employs hundreds of peoplemaybe thousands. It is not a cottage industry; it is a very substantial economic contributor. It is also sexy, attractive and international, and it has all the status and economic benefits that flow from those attributes. If that can be done in the borders with cashmere, scores of other niches can be established throughout the United Kingdom. That will allow the industry to continue to be important and valuable. The industry will not, as it did before, succeed through the mass production of items that can clearly be produced more cheaply elsewhere, but that does not mean that there cannot be a healthy textile, clothing and footwear industry. I believe that the industry will be design and quality-led, rather than mass-production-led. There is much to be done, but with the industry and the Government working together, we will achieve it.