INTRODUCTION

The 1980s were a period of economic volatility. The Conservative government, elected in 1979, pursued a host of free-market reforms, including privatisation, reducing the powers of trade unions, deregulation and lower income tax rates. Despite considerable lobbying from the regional and district councils, the government withdrew Assisted Area Status from the Scottish Borders in 1982, which resulted in the region no longer being eligible for government or European Community regional economic development funds. This meant that financial inducements were no longer available to incoming firms and for investment projects by existing companies. Compared to the rest of Scotland, the Borders had a relatively low proportion of overseas manufacturing investment, reflecting its lack of success in attracting inward investment.

Despite continuous lobbying of government, supported by local Members of Parliament, particularly Sir David Steel, the Conservative government would not be persuaded that the Scottish Borders deserved development area status. The government's attitude is amply illustrated in the views expressed by George Younger, former Scottish Secretary on a visit to Hawick in 1987 when he suggested that: ‘The Borders is a good example of how an area can fend for itself. With a certain amount of help from the local authorities and the SDA, the Borders people have done their own thing successfully’. His comments incensed Galashiels Councillor Drew Tulley, who would subsequently become Chairman of the Planning and Development Committee, who demanded that a further attempt should be made to put forward a case for the reinstatement of development area status.

In April 1985, the Borders lost priority status for European Social Fund (ESF) assistance, which limited the amount available for vocational training. However, the Borders, along with other rural areas in the UK, remained eligible for assistance under the Guidance Section of the European Agricultural Guidance and Guarantee Fund (EAGGF), which was used to provide support for the agricultural industry through initiatives such as the Less Favoured Farming Areas, Farm/Woodland Initiative, Set Aside and Farm Diversification Scheme and direct support for projects involving the processing and marketing of agricultural and fishery products, such as grain drying and storage, potato grading and storage, egg packing, vegetable and fish processing.