Catalogue description Ministry of Labour and successors: Special Areas

Constraints on local authority expenditure imposed in 1932 exacerbated the problems of areas in Britain, commonly referred to as 'depressed areas', where unemployment was exceptionally high. Demands for greater Exchequer assistance to these areas led the Cabinet to approve the appointment of four investigators to study the dimensions of the problem of mass unemployment and to make recommendations for its alleviation. Reports of the investigators were discussed by an inter-departmental committee, recommendations were made to the Cabinet and the Special Areas (Development and Improvement) Act of 1935 was passed as a result.

Two commissioners, one for Scotland and one for England and Wales, were appointed with powers to initiate new schemes designed to stimulate the introduction of new industries into specifically designated 'special areas'. The former was responsible to the Secretary of State for Scotland, the latter to the Ministry of Labour. Although initially their activities were circumscribed by a tight budget and strict conditions governing expenditure (no direct help could be given, for instance, to any profitmaking enterprise), their powers were extended in 1937 to allow them to provide factory premises and financial inducements to firms willing to open works in these areas.

In this way state responsibility for regional development was recognised in principle, however little these early schemes achieved in practice. A commitment to a long term regional policy was implicit in the appointment of the Royal Commission on the Geographical Distribution of the Industrial Population in 1937, which reported in 1940 (Barlow Report: Cmd 6153 1940). Under the Distribution of Industry Act 1945, the commissioners were abolished and the Special Areas were renamed Development Areas. General responsibility for regional policy and the distribution of industry passed to the Board of Trade.

Although the work of the commissioners was under the general direction of the Ministry of Labour, the nature of their activities meant that they also operated in conjunction with the Ministry of Health, the Board of Trade, the Ministry of Agriculture and the Unemployment Assistance Board, while control of the Special Areas Fund remained in the hands of the Treasury.