LOCAL GOVERNMENT BILL

HC Deb 10 December 1957 vol 579 cc1085-208

Order read for resuming Adjourned Debate on Amendment to Question [9th December], That the Bill be now read a Second time.—[Mr. H. Brooke.]

Which Amendment was, to leave out from "That" to the end of the Question, and to add instead thereof: this House declines to give a Second Reading to a Bill which fails to meet the increasing financial difficulties of local authorities, does not fully rerate industry or give local authorities the full benefit of partial rerating and which, by the substitution of a general grant for existing grants, hampers the development of essential social services, particularly those of education and health."—[Mr. Bottomley.]

Question again proposed, That the words proposed to be left out stand part of the Question.

4.2 p.m.

Mr. Michael Stewart (Fulham)

In yesterday's debate we had the advantage of the opinions of Government Back Bench supporters on the Government's own Bill. Those opinions followed a certain general pattern. After a few stereotyped phrases in support of the general principles of the Bill, hon. Members opposite went on to explain why they found the Bill disagreeable either in a particular locality or to a particular service of which they had special knowledge or in which they had special interest. We had a series of vague, theoretical reasons as to why the Bill was good in general and sharp, precise reasons as to why it injured everybody in particular. I cannot think that the Minister of Education, who is to follow me in the debate, if he heard yesterday the speeches of my hon. Friends who represent Birmingham, Small Heath (Mr. Wheeldon) and Birmingham. All Saints (Mr. D. Howell) will tell us that there is great enthusiasm in the City of Birmingham for the passing of the Bill.

Since it is the Minister of Education who is to follow me, I propose to concentrate my remarks on the effect of Part I of the Bill on the education service. I do that without any derogation to the many other important matters in the Bill and on which, no doubt, many hon. Members will wish to speak. By general agreement, the effect of Part I on education is one of the major aspects of the Bill. It will be convenient, therefore, to concentrate our attention for a short time on that matter. Everyone who has discussed this question in the House or outside has been obliged to ask himself why the Government are making this substitution of block grant for percentage grant in education and certain other services.

Broadly, we have received from the Government two answers. When the Government speak with the voice and manner of Dr. Jekyll we are told that it is to give greater freedom to local authorities. No sooner has Dr. Jekyll finished speaking than up from the Tory Party Conference leaps Mr. Hyde with the suggestion that the real idea is to restrict expenditure in these services and to restrain extravagant local authorities.

Let us look at how much validity there is in the Dr. Jekyll argument of increased freedom. We have been told with great emphasis that it is a grave infringement of the freedom of local authorities to impose a percentage grant on them and that it implies a contemptuous attitude towards their sense of responsibility. Those who have opposed the percentage grant have been charged with having no trust in it and having too low an opinion of it. Surely it has taken the Government some time to find this out. For forty years, a truly biblical period, local authorities have lain in the supposed bondage and writhed under the supposed insult of a percentage grant.

Surprisingly enough, neither by the local education authorities nor, except tentatively and inconclusively, by Governments during those forty years, have attempts been made to deliver them from this bondage and insult. The quarters from which suggestions about block grant rather than percentage grant have come are such as to make us suppose that it is Mr. Hyde rather than Dr. Jekyll that informs this argument.

If local authorities are to be given greater freedom, in what sphere will it be given? Freedom is the right of choice. A man, council or institution has freedom in so far as he or it has a certain number of alternatives and can make a choice between them. Where does this supposed freedom lie? Will they be free, as the Minister of Housing and Local Government suggested, from certain niggling controls supposed to be associated with the percentage grant? The Minister has not told us what niggling controls these are. He has not brought forward any evidence of complaint from local authorities that the operation of the percentage grant is, by virtue of the controls required, vexatious to them. Not only has he not brought forward any evidence, but those who have searched for evidence have not found any. They have found that what evidence there may be points in the contrary direction.

The Institution of Municipal Treasurers and Accountants made an inquiry into this matter. The distinguished financial officers of great local authorities who examined the matter and the county boroughs, Metropolitan and Home Counties local authorities from whom they inquired all gave an answer which can be summarised in the words "Departmental inquiries "—that is to say, inquiries relating to the operation of the percentage grant. They said, "They are riot unreasonable and little inconvenience is caused by answering them." That is the considered answer of people who studied the matter.

It may well be true that there are certain controls exercised by the central Government that are both vexatious and unnecessary, but they are not to be found in association with the percentage grant. The Government have admitted that by proposing, among other measures, to undertake an overhaul of central controls in general. Good luck to them. If they can find any controls that could properly and reasonably be done away with, so much the better. But they have not found—and all the evidence is that they will not find—that such unnecessary and vexatious controls that exist will associate it as a matter of cause and effect with the operation of a percentage grant rather than a block grant.

Is the supposed freedom a freedom to choose how they will allocate the block grant between education and the ten other services mentioned in the Act to which it will apply? In theory, that freedom will exist, but if anyone supposes that it exists in practice I hope he will study the impressive speech made yesterday by my hon. Friend the Member for All Saints It will be remembered that he examined all those services. Before we even begin the examination we have to remember that the part of the block grant which is in any way related, or can be supposed to be related, to education is eight times as great as that related to all the other services covered, under the Act, by the block grant. If, therefore, local authorities try to exercise freedom in this sphere to cut down any of the other services to an impossible and unreasonable extent they will be able, as a result, to make only a minimal addition to their educational expenditure.

Is it suggested that people of nobler character and greater wisdom will be attracted into local government service by the reflection that it is now possible to decide to spend a little less on police vehicles and school crossing patrols and spend a little more on education? It will not be possible for them to make the economies on the other services. They might be able to do it the other way round, but is it the desire of the Minister of Education that they should exercise their freedom by spending less than they would have done otherwise on education so as to have more police vehicles, more road crossing patrols, or more of the items designated in the Schedule to the Bill?

Mr. Geoffrey Rippon (Norwich, South)

Or vice versa.

Mr. Stewart

I dealt with the vice versa situation earlier.

Does the freedom arise in relation to the attitude of local authorities to the different parts of the education service? Let us see what some of those parts are. The largest part—that which involves the greatest expenditure; which is most in the public eye, and which the average man thinks of first when the education service is mentioned—concerns the provision of the ordinary primary and secondary schools maintained by the local education authorities.

In what respects will the introduction of a block grant give a local authority greater freedom of real action in its management of its maintained primary and secondary schools? Among the most obvious and pressing things that need to be done in those schools are the recruiting of a greater number of teachers and an improvement in the size and quality of the buildings. The extent of the local authorities' freedom in those matters depends partly upon the mere facts of the case—such as the number of teachers available at any given time—and partly upon controls, suggestions or recommendations put forward in quite a different connection by the Ministry itself.

There is, for instance, the Minister's present attitude about the degree of restraint which authorities should exercise in the recruiting of teachers, so that some authorities do not do exceptionally well in comparison with others. A change from a percentage to a block grant cannot alter the Minister's attitude about the supply of teachers. If circumstances alter in that respect lie may be able to relax the restrictions which he at present urges upon local authorities, but that would be quite independent of the question whether a percentage or a block grant system were operating. The degree of restriction of a local authority is in no way connected with the grant, and its freedom will be in no way increased by a change from a percentage to a block grant system.

Similarly with buildings we have had few things more curious than the suggestion, in the speech of the Minister, that the Bill would give us an opportunity to discuss the education service I do not know whether he has noticed it, but the House has done that on many occasions, and will persist in doing it, Bill or no Bill. During those discussions the question of the Ministry's control over local authorities' educational building programmes has appeared very prominently. We know why it is necessary for the Minister to have a say in the matter, and that reason is not in the least altered by a change from a percentage to a block grant. In the major part of the education service this change will give local authorities no greater freedom than they enjoy at the present time.

What about the other parts of the education service? It is about these that some people who have studied the Bill very carefully have the greatest anxiety. Even if a local authority is not public spirited it will think twice before very seriously neglecting its schools—because a very considerable number of its citizens will notice and resent the fact. There are other parts of the education service which are quite as important to the nation in the long run, but which do not immediately affect so many people.

There is the question of the scale of maintenance allowances paid by a local authority to children staying at school past the school-leaving age, and the generosity of the authority's allowances to students going on to universities or other institutions of further education. In that connection, I hope that the Minister will consider amending the Bill in Committee so as to include those student allowances in the arrangements which are pooled, as occurs in connection with certain other parts of the education service.

Then there is the youth service. The Select Committee on Estimates has already remarked about the extreme coldness of the Ministry towards that service. That is the kind of thing that could too easily be neglected as soon as a local authority finds itself in difficulties owing to the operation of a block grant. There is also adult education. Although the champions of that are intelligent, articulate and vigorous they are, unfortunately, fewer in number than those who would be affected by more obvious but perhaps not more serious neglect of the education service.

Is this freedom a freedom to go beyond the standards normally recommended or advised by the Minister in certain parts of the education service? Here we have an important point, in connection with which the Government are either misleading us or are under a serious misconception themselves. A short time ago my hon. Friend the Member for Southampton, Itchen (Dr. King), in an Adjournment debate, raised the matter of the maintenance allowances of children staying on at school, which I take as an example of a whole group of services. In the course of that debate the Parliamentary Secretary to the Ministry of Education said that one of the advantages of the block grant was that it would enable a local authority which wanted to go beyond the scales of allowances now recommended by the Minister so to do.

What is the position, in fact? At present, there is a scale which the Minister has not rigidly prescribed but has recommended and encouraged local authorities to attain to. Rather less than half attain to it. But let us suppose that an authority wants to go beyond that. There is nothing in the law to stop it. The Minister can permit it to do so today, provided that it is prepared to meet the extra cost from the rates. That is exactly the position which will operate under a block grant system. The block grant gives a local authority no further liberty in that respect than exists at present. It gives the authority liberty to do something extra, provided that it is prepared to bear the extra cost involved out of the rates. The authority will be in no different or freer position under a block grant system.

What about those authorities which are not yet up to the standard? If they try to rise to the standard under a block grant system the whole cost will have to fall on the rates, while those authorities which are content to remain below the standard will have a financial advantage as a result of their failure to do so. The effect will be that no advantage will accrue to those authorities which want to be more generous—and a disadvantage will be inflicted upon those who are striving to rise to the prescribed standard—while there will be a reward to those authorities who are not anxious to reach the standard.

Finally, is it freedom to keep the education service down to the minimum? The answer is, "Yes". We were told over and over again by hon. Members opposite that the Minister of Education would still be on the watch to maintain minimum educational standards. I shall have a word to say shortly about the methods available to him for that purpose. But let us suppose that he does that. Under the block grant system he has still provided freedom for a local authority to do no more than the minimum; and not only freedom to do so, but a positive incentive. The local authority which, having received the block grant, keeps its services down to that minimum which just prevents it getting into trouble with the Ministry, will have a financial advantage and a reward for doing so.

The position, therefore, is that in many parts of the education service we discern three levels: the minimum standards, below which the Ministry will not allow an authority to fall; standards at a higher level which the Minister himself prescribes, recommends or encourages; and a further level which ambitious authorities might reach. The result of the block grant proposal is that for those who want to go beyond the standards there is no change in their ability to do so; for those who are raising their minimum standards to the recommended standards the task will be harder, and for those who are content to stay as near the minimum as they dare there will be a positive reward.

We know that Acts of Parliament cannot make individual citizens virtuous, but we regard it as part of a common sense and good morality that the framework of our laws should be such as to make the pursuit of virtue rather more rewarding than the pursuit of its opposite. In the same way, Acts of Parliament alone cannot make local authorities public spirited if their citizens do not want them to be public spirited, but it is at least common sense and good administration to arrange the grant system so that the path of the public spirited is made easier and the path of the cheese-paring is made harder; and that is exactly the opposite of what this proposal does.

It has been suggested repeatedly that we on this side of the House do not trust local authorities, that we regard them as prone to neglect the services. There is not much evidence of that charge. There is a good deal more evidence of the charge that the Conservative Party regard local authorities as bodies which will waste money the moment we give them the opportunity to do so. If we strip away the party controversy from this matter, the facts are that some local authorities are better than others, that some are more public spirited and that others are more inclined to parsimony than to public spirit. The effect of the block grant system is to put a premium on parsimony and a penalty on public spirit.

I shall be told that all these apprehensions are groundless because the grants will be so generous in amount that none of these evil results will follow. I want to show now why we on this side of the House and nearly everybody interested in education throughout the country are afraid that the grants will be inadequate.

We have good reasons for thinking so. First, all the previous associations of block grant proposals have been with economy proposals. The pedigree of this monster is not attractive. Secondly, the Minister of Housing and Local Government, in his White Paper, described the percentage grant as an indiscriminating incentive to further expenditure. If one says that one is getting rid of something because it is an indiscriminating incentive to further expenditure. then it is a reasonable presumption that one expects and wants the result of one's action to be a reduction in that expenditure.

I do not know what is meant by this talk of indiscriminating incentive. To hear some of the defenders of the block grant talk, one would think that the local authority says quite cheerfully. "We will expand in this direction and in that direction", as if the 40 per cent. cost which it will put on to the ratepayers were a mere bagatelle. It certainly is not so, because 40 per cent. of the cost is a very serious consideration to local authorities.

If we look at some of the answers which hon. Members opposite have given when pursued by persons in their constituencies who are interested in education, we find that some hon. Members, not very happily from the point of view of their Front Bench, have mentioned the block grant as one of the Government's measures against inflation. The assumption that the Government will still be continuing their measures against inflation eighteen months from now is, of course, pessimistic as to their efficacy, but perhaps it is not unjustifiable pessimism; but if it is described in those terms it is not surprising that people feel that one of the purposes of this Bill is to restrict expenditure.

Indeed, hon. Members opposite who gave that kind of reply had good precedent for it, because the Financial Secretary to the Treasury, at the Tory Party Conference, listed the block grant as part of the Government's battle against inflation. If the Government would come forward and say, plainly, "The country is up against it and we are sorry to say that education, like everything else, must bear its share," that would at least be understandable. That is what the Minister is saying about his circulars which restrict educational development in certain respects at the moment. But if the Government want to say that about the block grant, let them plainly say it. The trouble is that they try to assert that in one breath and to deny it in the next.

If we have any further reasons for distrust, they lie, if the Minister of Housing and Local Government will allow me to say so, in the Minister himself. He introduced the Bill. He gave us the assurance that no assault on the education service is intended. When we hear assurances from him of all people, however, other assurances float through our minds—for instance, assurances given by the Conservative Party at the last Election that they did not propose to allow a general increase in rents.

It is not encouraging to find that the assurances for the future of education are given by the very Minister who is the Government's chosen instrument for their major breach of faith in this Parliament. The trusting princess who marries Blue-beard without knowledge of his antecedents may be forgiven, but there is no excuse for the simplicity of the maiden who entrusts herself to him after the contents of his secret cupboard have already been disclosed.

If we have reasons for thinking that the grant will be inadequate, we also have good reason to fear that it will not he sufficiently flexible. Whenever it has been suggested that the grant would be inflexible and that it would not enable local authorities to meet rising and differing costs, we have been referred to those Clauses of the Bill which apparently allow certain variations. Let us look at them. If we are to take at their face value the speeches which we heard yesterday from he defenders of the Bill, we are to assume, first, that the first calculation of the amount of the percentage grant will be based on a generous estimate of the need for the education service in the first grant period, but, alas, that estimate will not be made by the Minister of Education but by his colleague, the Minister of Housing and Local Government, sitting next to him. That is only one of the respects in which the Bill puts education into the position of a subordinate Ministry to the Ministry of Housing and Local Government.

If we do not make the encouraging and perhaps over-optimistic assumption that the original calculation of the grant will be made on a generous reckoning of what education expenditure will be in the first grant period, we are told that it can be varied during the period. It is likely, is it not, if there is a heavy inflation which causes all local authorities' costs to increase, that a Government will pick that moment to come forward with a special Order, to be debated in Parliament, to increase the amount of the grant? When this procedure was first suggested it was described as a most exceptional procedure, but to hear hon Members opposite yesterday one would have supposed that at the first cloud on the horizon this procedure in the Bill will be invoked. The one thing which is, quite certain is that it cannot be invoked until local authorities have already suffered fairly severely from the inflation.

Will the grant be sufficiently flexible to allow for widely differing costs for running the same service in different areas? The present formula is not. If the Minister's example is any guide to the facts—and although it is only an example it ought to be of some value—the new proposal is not a formula flexible enough to allow for the variations in costs which occur between different areas for reasons often quite unconnected with the factors mentioned in the weighting formula in the Bill. The costs of education in some areas, other than the salaries of teachers, are sometimes twice as much per pupil as in other areas, and that is due not to extravagance but to factors outside the authorities' control. There is certainly no provision for that in the Bill.

If we altered the Bill in this respect to give a block grant which was based in the first place on the assumption of growth, which contained differing amounts for each year of the grant period, which was subject to variation within the period on any reasonable ground and which contained a formula capable of allowing for different levels of costs in different areas—if we had all that and if we removed all the grounds that exist for fearing that the grant is inflexible, we should end up with an infinitely clumsier way of calculating a percentage grant.

In that case we might as well have remained where we were at the beginning. We cannot move from percentage to block grant and then pretend that we can give a block grant all the qualities which, by its nature, it does not possess and is not intended to possess. As a character in one of Bernard Shaw's plays says, "You can't jilt a lady in a gentlemanly way; the thing isn't gentlemanly in itself."

Now I would say a word about the maintenance of minimum standards. Over and over again those who were concerned for education have told us "Your fears are groundless. The powers of the Minister to maintain minimum standards are in every way unchanged." The hon. Member for Ilford, North (Mr. Iremonger) was very emphatic on this point yesterday and his speech was most illuminating. He showed that if an authority fell below minimum standards the Minister could threaten it with withdrawal of the grant.

Once again, he can do this only if the Minister of Housing and Local Government agrees. It is true that the Minister of Housing and Local Government cannot do it except on the certificate of the Minister of Education, but I see nothing in the Bill to prevent a situation in which an unhappy Minister of Education comes forward eagerly with a certificate and finds that his colleague at the Ministry of Housing and Local Government is not prepared to withdraw the grant. There is nothing to say that the grant must be withdrawn if the Minister of Education is unsatisfied with this service. Again, the Minister of Education is put into a subordinate position. This is a point on which the Ministers concerned might consider amending the Bill.

We were told that the Minister can proceed by Order and directive, and finally—said the hon. Member for Ilford, North—by invocation of Section 99 of the Education Act, which permits the pushing of authorities about by means of a writ of mandamus. Really, it is a long journey—to use the phrase of the Minister of Housing and Local Government—from the road to freedom for local authorities to the invocation of a writ of mandamus.

What does all this amount to? It means that we are giving local authorities less incentive to do their work well, and less reward for doing so. Because we cannot rely much upon reward we must rely more upon threat and punishment. A step away from using reward as an incentive and towards using threats and punishment is not a step towards freedom, but away from it.

We speak of minimum standards. The Minister will have been in his Department long enough to have studied the differing standards that prevail in various authorities, and he will agree that it would be a bleak educational world indeed if what are now minimum standards became the universal standard all over the country. The progress of education depends very largely on there being authorities eager to step up a bit beyond the minimum and to make what was the aspiration of one decade the minimum of the next.

Up to now, under the percentage grant, authorities that were prepared to do that could not just do it cheerfully at no cost to themselves, but they were at least given a reasonable incentive and reward for the valuable service that they were rendering to the nation. What we have now is something which, beyond minimum standards, is a punishment rather than an incentive. If we ask what progress we are to make beyond minimum standards we find that the less a local authority wants to go beyond a minimum standard the easier its financial position will be.

The effect of that upon education over a generation could be very serious indeed. It would gratify some of the Mr. Hyde forces that are behind the gentle visages of the Ministers who are propounding the Bill. It would gratify certain sections of the Tory Party Conference, and would do a great injury to the nation. It would do, by a back door, what Ministers are not prepared to do to education by the front door. The attitude of Ministers to education reminds me of the attitude of the conspirators in Shakespeare's Henry VI against the good Duke who was then Protector of the Realm: That he should die is worthy policy: But yet we want a colour for his death: Tis meet he be condemn'd by course of law. A great deal has been said during the debate about the importance of local authorities to democracy. We should also remind ourselves that all government, central or local, is only a means to an end. Government exists to provide the citizens with defence, security, amenity, health, education, and all the other services of civilised life. Those services do not exist to give Parliament and councils something to do. Citizens will not, in the long run, engage in a nice balance of argument as to, "Have you made the borough council interesting for the borough councillors, and Parliament interesting for the Members?" They say, "What is the quality of the services that are being rendered?"

We reject the Bill because its provisions for maintaining minimum standards in education are more clumsy and less effective than those which now prevail, and because, for progress beyond the minimum, the Bill imposes a positive penalty on those authorities which are best prepared to serve the nation.

4.36 p.m.

The Minister of Education (Mr. Geoffrey Lloyd)

The hon. Member for Fulham (Mr. M. Stewart) has asked me to be frank and not to take refuge between saying one thing on one occasion and another thing on another. He drew the parallel between Dr. Jekyll and Mr. Hyde. Therefore, I propose this afternoon to be very direct with the House on this very important question, as it affects education.

I shall reply to a great many of the points made by the hon. Gentleman, and by other hon. Members in the debate yesterday. I must, first, explain sonic fundamental points about the Bill which have so far escaped the attention of most hon. Members, particularly on the Opposition benches. I make a special exception of my hon. Friend the Member for Ilford, North (Mr. Iremonger), who had done some exceedingly efficient homework on the Bill. Naturally, I have done some as well, with a good deal of assistance. It may help the House to get to grips with the real issues with which we are faced.

I was rather surprised that the hon. Gentleman, who has held office himself, should attempt to draw a distinction between the Ministers mentioned in the Bill as performing special functions. As to whether the grant is actually fixed by my right hon. Friend the Minister of Housing and Local Government, who is sitting beside me, or by the Chancellor of the Exchequer, the hon. Gentleman must know that under the system of Cabinet Government this is a matter of Government policy and, therefore, it must be settled by the Government as a whole and by the Cabinet. It is not of the slightest importance who is actually named in the Bill. [Interruption.] I am being very frank. Anyone with Parliamentary and governmental experience knows that what I say is correct.

Everybody knows that it is not possible to make a serious alteration in the grant system without including education because of the great importance of the service and of the large amount of money involved. Here is the rub, because acute controversy has broken out in educational circles about the proposals now before the House. I am sure that the House wants our discussions to be based on reality. Therefore, I must tell the House that what the right hon. Gentleman the Member for Rochester and Chatham (Mr. Bottomley) mentioned—I want to emphasise it—is true; with the exception, the significant exception I think, of the local authority associations, the whole of the organised educational world is strongly opposed to the proposals in the Bill.

The Association of Education Committees and the National Union of Teachers are not always in agreement, but they have collaborated in producing a pamphlet which is called "The Threat to Education", and they have organised a series of meetings throughout the country in order to attack the general grant proposals.

I know that the House, in these circumstances, would want to pay special attention to this question of education, and, indeed, I want to do so also, as Minister of Education. If the House will allow me, I should like to take hon. Members through what I conceive to be the main objections to the general grant proposals. Of course, I take them from the speeches of the hon. Gentleman the Member for Fulham, of the right hon. Gentleman the Member for Rochester and Chatham, who spoke yesterday, of the hon. Gentleman the Member for Wellingborough (Mr. Lindgren) and other hon. Members of the House, and also from the pamphlet "Threat to Education" and from deputations I have received from the educational world.

I hope to be able to show that some of these objections, although not all, are based upon a complete misconception. I want to deal with them first, because I then want to concentrate on the other important objections which remain. We all know that education is an expanding service, and we all accept that, but the educational spokesman, and particularly the hon. Member for Wellingborough, who spoke last night, said that this new plan must mean reduced expenditure on education. The hon. Member for Wellingborough said that any increased expenditure on education would have to come out of the rates. In order to make this point quite clear—crystal clear—I should like to quote from a speech made by Dr. Alexander, Secretary of the Association of Education Committees, in the Central Hall, on 2nd December. He said: The whole cost of any new proposals would fall on the rates alone…. In five years' time the education service would cost £700 million a year—£150 million more than it did at present. If the block grant were introduced the amount to be found by the local authorities would go up from £200 million to £400 million. This would mean an increase of 7s. in the £ in rates. It is a little similar, but not quite similar, to the point made by the hon. Gentleman the Member for Birmingham, All Saints (Mr. D. Howell) with regard to Birmingham's problem, which I hope to deal with later if I have time. This statement and similar ones have been printed and repeated all over the country and also in this House. I hope to be able to show hon. Members why this statement and all similar statements are completely Inaccurate.

I would remind hon. Members that my right hon. Friend the Minister of Housing and Local Government yesterday said that, in regard to the question of grants, Clause 2 of the Bill was the vital Clause. I would ask hon. Members to consider this Clause, particularly from the point of view of education, because the Clause lays down what the Minister or the Government is bound to consider by Statute in fixing the general grant. In subsection (1) the House will see under paragraph (a), that he has to take into account the latest information available to him of the rate of relevant expenditure,… which for our purpose means that the Government start by considering the present rate of expenditure on education as it is at the time. Then, under paragraph (b), he has to consider any probable fluctuation in the demand for the services… that is, for education, the obvious needs of the increasing school population. Thirdly, in paragraph (c), he has to consider: The reed for developing those services and the extent to which, having regard to general economic conditions, it is reasonable to develop those services. That is the need, which is, I think, agreed by everyone, for further development of the education services in present circumstances.

Mr. John Diamond (Gloucester)

The right hon. Gentleman referred to the Clause as the answer to all our fears. I should like our fears to be answered. He has referred to a Clause which says "reasonable". He knows that that is never to be found in a Clause without defining whose judgment is to be relied upon.

Mr. Lloyd

It is obvious that in the last resort the Government themselves must take responsibility. But, as I shall have occasion to mention later on in another connection, before the Government take their decisions they are by Statute required under Clause 1 to consult the associations of local authorities and also to bring forward in this House an affirmative Resolution which, no doubt, will be debated.

I have now taken the House through the formal safeguards to be laid down by statute, but I want to add to that an assurance which I think will interest the House and will. I am certain, interest the education world. I want to state categorically, since we know it is in the last resort the responsibility of the Government, that it is no part of this Government's policy to reduce the central Government's grant aid to local authorities' expenditure on education. It is not part of our policy to freeze that contribution at its present level. But it is our policy to make a proper increase in that contribution in accordance with Clause 2 of the Bill.

Mr. G. Lindgren (Wellingborough)

Why is it in the Bill at all? What is the necessity for it?

Mr. Lloyd

I should like at this point to say a word on the general question of the extra advantages which local authorities will derive from the Bill. I listened to the hon. Gentleman the Member for Birmingham, Small Heath (Mr. Wheeldon) yesterday, and I understand his argument, but I think it is relevant at this moment to say that in the transitional period they do get £40 million which they cannot get their hands on at present, and, of course, they will have the extra £10 million from re-rating.

I should like to say a word about the Birmingham point, which was put by the hon. Gentleman the Member for All Saints. He said that at present, as we know, the city is under-establishment so far as teachers are concerned, and he asked what was likely to happen in a few years' time when they got 400 or 500 extra teachers. I think the hon. Member for Small Heath's point was that expenditure is getting on for £500,000 and they will not get any more under this proposal. I should like the hon. Gentleman to realise, and I think it is a good example for the House to appreciate in regard to the problem as a whole, that the general grant will be fixed with due regard to the Government's policy and to the average teaching establishment which is necessary for the education service in the country as a whole.

That, of course, means that a city like Birmingham, which is at the present time several hundred teachers below establishment, would, if the general grant were in operation, already be getting the money in respect of the proper establishment of teachers. Therefore, it would be getting a general grant which assumed that it was fully staffed. It would be getting benefits from a strictly financial point of view which would certainly help it to meet its problems.

Mr. Denis Howell (Birmingham, All Saints)

This is extremely important. Is the Minister saying that when the Bill becomes an Act of Parliament and the block grant is decided upon for Birmingham and other authorities, that will be a grant taking into consideration the maximum staffing establishment of the schools and that no matter how many teachers we are able to recruit afterwards the extra cost must go on the rates?

Mr. Lloyd

I am not saying that. I am saying that the grant would be fixed in order to make an appropriate contribution in relation to the average staffing throughout the country. Therefore, if the city, as at present, were below staffing establishment it would not suffer but, would, in fact, make an uncovenanted financial gain.

Mr. F. H. Hayman (Falmouth and Camborne) rose—

Mr. Lloyd

Would the hon. Member allow me to proceed, because I do not want to be too long with my speech? After I had dealt with deputations from the local authorities on the financial question I have just mentioned, and after I had explained to them that they should dismiss from their minds any idea that it was Government policy either to reduce or to freeze present Government expenditure on education, they immediately brought forward another objection, to which they attached very considerable importance. They said, "Even if sufficient money is provided, we are still opposed to the proposal." They felt they could not be sure of getting that money for education.

They were afraid that a local authority would take it away to be used for other services. I naturally asked them. "Are you really asking me to accept the view that national Government can be trusted to give due importance to education whereas local government cannot be trusted in the same way?" Much to my surprise, they replied, "Yes". I think it important that we should study these arguments carefully. They said, "Yes, and the reason is that education is by far the most important local service and is spending far the greatest amount of money—more than any other service. All the other committees are jealous of the education committees and waiting to take a slice of the money education committees think ought to be devoted to education." They further said that they considered that the position of the Minister of Education in the Cabinet was stronger in regard to education because there he had colleagues also responsible for large spending departments.

I ask the House to give serious attention to this matter, because it is true that educationists are seriously alarmed about it, and also because I think it is a question which spotlights a crucial feature of the Government's plan. Also, I believe that by bringing it out into the light of day we may do a great deal to prevent any danger there may really be in this idea. I ask the House, therefore, to consider how these matters will arise in practice. I have made it clear that the general grant is to be fixed in accordance with the education policy of the Government. That policy, as is normal, will be announced in this House and it will be made known to local authorities. Particularly we have to remember the procedure under the Bill, that under Clause 1 it will be necessary for the Government to consult the associations of local authorities and then, under the affirmative Resolution procedure, there will be a debate in this House.

Can we really believe that local authorities will frustrate the national policy approved by Parliament and properly provided for in the moneys voted by this House?

Mr. Hayman

Yes.

Mr. Lloyd

I do not believe it, and if it did happen in one or two isolated cases, it is the fact that the powers of the Minister under the Education Act remain exactly the same as they were before the Bill was introduced and before it is passed and becomes an Act. The hon. Member for Fulham referred to a writ of mandamus, but as my hon. Friend the Member for Ilford, North pointed out, there are various less severe sanctions. In fact, it has always been possible in the past by the use of one or other of the powers in the Act to bring—if I may use the word—a recalcitrant local authority to heel. All the same, I feel we want to do everything we can to help local authorities and particularly education committees in regard to this new plan because we must realise—this is the essence of the problem to which hon. Members opposite have not paid full attention—we are asking local authorities and education committees to do something new which does involve an increase in responsibility. It does unquestionably demand from them a fresh approach and a changed outlook.

I will say what these changes are, particularly in regard to education committees. They are going to be much more closely involved than now in explaining and defining their proposals to their councils and finance committees and to local public opinion. I cannot believe that is a bad thing; on the contrary, I think it is all to the good. It has been said by hon. Members opposite that, while there has been a great deal of talk about freedom, there has been no example given. The right hon. Member for Rochester and Chatham challenged me on this point yesterday and the hon. Member for Fulham today talked about niggling controls. He said that an association of local authority officers had said that departmental inquiries had not been found to be vexatious. I daresay that may be the case, but I am not at the moment going to talk about departmental inquiries. I am going to talk about the very point he mentioned, a certain number of controls which are specifically related to the percentage grant.

I will give a general instance of why this is so. The very fact that £40 of local expenditure carries with it £60 of Exchequer money has always meant in practice, under every Government, including that of the hon. Member for Fulham, that the Treasury has insisted—although the work is actually carried out by other Departments under the system of collective responsibility—that there should be certain powers of veto and limitation on a number of things that are done by the local authorities.

I give as an example the provision of school transport. Some people may say that is a small subject, but it is a very human subject and there has been a great deal of difficulty about it. Hon. Members know that in the Act it is laid down in regard to children over eight that there is a duty on the local authority to provide transport if they live more than three miles from the school. Also in the Act there is discretion to provide transport over shorter distances, but in fact successive Governments—not merely this Government—have refused to provide grants in respect of any distance less than the three miles laid down in the Act. [HON. MEMBERS: "No."] There have been just very occasional exceptions, but broadly speaking that has been the case, and it has caused a great deal of irritation in many parts of the country. That is a control which I should feel able to withdraw immediately the grant comes into operation.

There are other matters of a kind in which the hon. Member for Fulham is particularly interested. He said that if only the Minister would do something, for example, about the minimum scale of fees for further education that would be really worthwhile. That is exactly one of the things which I propose to do at once. If the general grant comes into operation this is a control which will immediately disappear. [An HON. MEMBER: "The could do it now."] An hon. Gentleman says "They could do it now," but the point is that local authorities have grown so accustomed to the grant system that they are, as a practical matter, never prepared to do anything which does not attract grant. Broadly speaking, that is the case.

It must be remembered that under the new system, when there will not be a percentage grant and when the local authority will be receiving a lump sum which it can handle, it might be, in much the same way as its own rate income, there will be a completely different approach. Therefore, this freedom will be a real one. It will also apply to such rather irritating restrictions as the necessity for the approval of expenditure on furniture and equipment. This is not very onerous—the Ministry is, I think, reasonable about it—but it is much resented by many local authorities. That, also, will be able to go.

There is also the question, mentioned earlier in an Adjournment debate, of maintenance allowances for older pupils in secondary schools. We shall no longer have to provide a maximum scale here. I think that, together, these measures make up a useful instalment of freedom for full local responsibility. But only a little farther off is a further list which I should like to mention to the House, although the matters on that list would require legislation. Again I choose them for the reason which the hon. Gentleman mentioned, because the need for them really depends directly upon the percentage grant system.

On this list of further freedoms I would include expenditure on research, on facilities for recreation, on social and physical training, on conferences, the amount of assistance to non-maintained schools and also the scales for boarding fees at maintained schools. I propose directly the general grant system is in operation and before we can have legislation to remove these controls, which we intend to introduce, to operate them in such a way as to give the maximum effective freedom.

I wish to conclude by putting an important general point to the House. I want to put it frankly and to try, if that is possible, to avoid being misunderstood. Soon after I became Minister of Education The Teachers World offered me some advice which I would like to read to the House. It said: New Ministers have plenty of advice. For all that, here is some more for Mr. Geoffrey Lloyd. I assume that you want to do your best for education, the service to which you are appointed. Then forget the Ministry of Education, leave Curzon House unvisited. The permanent officials there will see that national education goes on. Local officials will see that local education goes on. And, when the officials have done their part, teachers will see that children are taught. Spend your time—all your time—in the Cabinet, in the House of Commons, in the country at large—working against inflation. It will not be easy, nor popular with the Opposition and its supporters. That is brightly and provocatively written, but the fundamental point is good.

May I therefore ask the House to consider the grant system from this point of view? From the point of view of experts in public and international finance a system of percentage grants creates uncertainty because it appears that Treasury expenditure running into several hundred millions a year is not under the control of the Central Government, but increases automatically as a result of decisions by large numbers of local bodies, bodies which are not concerned with nor, indeed, trained in matters of national finance. This is a weakness in our national financial arrangements which is not lost on financial experts abroad as well as at home.

What worries me about the present controversy is that the case as put forward by the educational associations pays not the slightest attention to this broad national financial problem. As far as their pamphlet is concerned, it might as well not exist, and the case is argued on grounds entirely confined to educational interests. In others words, it is a strictly sectional case. It may be argued that they are entitled to do this. I am not sure. But I am sure that it is our duty, if it is necessary in the national interest, to withstand any sectional interest, however respectable it may be.

My right hon. Friend said yesterday that the new system would help the Chancellor of the Exchequer in his budgeting because he would know more definitely what his commitments were. Hon. Members opposite jeered at that, but the statement is true. Nor is it inconsistent with an expansion in educational services in accordance with Government policy. But it is the fact that the present Government are making over a wide field a more vigorous attempt to contain inflation than has been made by any Government in recent years.

I ask the House to support the Bill because, in addition to its other undoubted merits, it has a moderate but definite part to play in the struggle against the greatest menace to the progress of our modern society.

Mr. G. R. Mitchison (Kettering)

Before the right hon. Gentleman sits down, may I put this point to him, because I am sure that he would not wish to mislead the House? He referred to expert opinion. I am only quoting expert opinion to which the Government themselves referred. Here is a treatise by the Institute of Municipal Treasurers and Accountants on local expenditure and Exchequer grants and it agrees very definitely with the former views of the right hon. Gentleman's Ministry that a percentage grant is right, and right for education.

Mr. Lloyd

I was referring not to experts in municipal finance, but to experts in national and international finance.

5.9 p.m.

Lady Megan Lloyd George (Carmarthen)

I am afraid the Minister has made a bad job of a bad Bill. He has protested too much and explained too little, and he has certainly not explained away the—

Mr. Edward Short (Newcastle-upon-Tyne, Central)

On a point of order. Can it be, Mr. Speaker, that the Minister has set the House on fire, because what appears to be smoke is drifting along under the Gallery.

Lady Megan Lloyd George

It is probably the steam and the hot air generated by the Minister of Education.

I was saying that the right hon. Gentleman has not explained away the block grant. He has certainly confirmed the worst suspicions of hon. Members on this side of the House. He has claimed, as did the right hon. Gentleman the Minister for Housing and Local Government yesterday, that the substitution of the block grant for the percentage grant is not a cut. He says that it is an incentive. The Minister for Housing and Local Government said yesterday that it means that local authorities will administer the services more thoughtfully, no doubt with an eye to their overdraft and the ratepayers. The Government say categorically that it is not the intention of the Bill surreptitiously to cut down services. May I ask, if that is so, why the Government have deliberately excluded from the block grant the police and prison services?

Why have they made special provisions for pooling the expenditure on higher technical education? Why should these two services be differently treated? Why are the police services to be denied all the advantages of the block grant of which the Minister spoke? Are they not vital services? Is it not important that we should keep them up to a high pitch of efficiency? Why have they been excluded? We are told it is for technical reasons. Very well. If there are technical reasons, I hope that the Government will explain what they are before the end of the debate.

To us the answer seems perfectly plain. The block grant is an instrument of economy, and the reason why these services have been excluded is that the Government cannot afford to have a cut in the police forces. The hon. Lady the Member for Tynemouth (Dame Irene Ward) gave the case away in a very interesting question she put the other day. With her shrewd North Country instinct she went straight to the heart of the matter. She asked whether in the North, where the proportion of grammar school places is below the national average, they could be brought up to the national average before the block grant system comes into operation. Why before? Because the hon. Lady knows very well that the chances of it being done afterwards are remote. The alternatives which, as a result of this Bill, are put before local authorities are very clear. No one made them clearer than the Parliamentary Secretary to the Ministry of Education. He said: If a local authority embarks upon a deliberate expansion of the education services as an act of local policy, it is the deliberate intention of the Government, and it is inherent in their proposals, that this should in future be the local authority's own affair in the matter of finance."—[OFFICIAL REPORT, 29th July, 1957; Vol. 574, c. 1025.] Nothing could be clearer than that. In fact, the Government are "passing the buck" to the local authorities.

Today the Minister of Education said that under the terms of this Bill local authorities would be able to explain to the public, to the ratepayers, why they could do certain things and why they could not do certain other things. The real point is that the Government are putting local authorities in the dock instead of being there themselves. I wish to ask the Parliamentary Secretary to the Ministry of Education what he meant when he spoke about an expansion of the education service. Did it include the levelling up of standards? The Minister of Housing and Local Government was very indignant yesterday at the suggestion that the block grant would mean lower standards, that it would lead to minimum standards. The right hon. Gentleman invoked Clause 3 (3) of the Bill where the Minister has power to prescribe standards. The Minister said he would not hesitate to use those powers to reduce grants to local authorities who failed to achieve or maintain reasonable standards.

My hon. Friend the Member for Gloucester (Mr. Diamond) asked the Minister this afternoon who is to be the judge of whether standards are reasonable or not. The Minister said it was the Government. In fact, the Government will be judge and jury in their own case. I wish to know what was meant by reasonable standards. The House and local authorities are entitled to some guidance in this matter. I am thinking not only of building standards but of opportunities and facilities for children in various parts of the country, because these standards vary greatly from one part of the country to another. Take the case of grammar schools. The average figure of children receiving a grammar school education in Wales is 35 per cent. In England it is 25 per cent. My right hon. Friend the Member for South Shields (Mr. Ede) once said that it is only by the grace of God that you can escape going to a university in Wales. But which of these standards does the Minister consider reasonable?

I will take another test, one of the most important tests of educational advance, the number of children in classes. Here again the variation in numbers is considerable. If we take the average number of pupils per full-time teacher in all counties—I hope the House will forgive me if I compare the figures in England with those of Wales—for all counties in primary schools in England, the figure is 30 and for Wales it is 24. For secondary schools in all counties the figure in England is 21 and in Wales 19. In totally maintained schools the English figure is 26 and the Welsh figure 23. Which standard will be the reasonable standard? I am not here quoting other figures in which the average number of pupils per class is very much higher in individual schools throughout the country.

I should like to take another yardstick. There are in this country a great many local authorities with leeway to make up due to causes largely outside their control. I am not speaking of reactionary authorities, but of authorities who have done their best but for one reason or another circumstances have been too much for them. Hon. Members on both sides of the House will know of the slum schools in the villages and in towns.

In this connection I would draw the attention of the House to the recent investigation into rural schools by the National Association of Head Teachers. Its report is very interesting. It is based upon 134 replies to a questionnaire issued in very widely separated rural areas. Some of the comments and conclusions are interesting.

It is stated that there are many rural schools which have not been affected by the intensive school building since the war. One in three of the schools has inferior sanitation. One in eight relies on inadequate water supplies from wells or springs which usually dry up in the summer. The report draws attention to one school where water is drawn from a hillside stream used by cattle. The report points out that in many of these schools heating and lighting are inadequate.

If local authorities in areas such as these are to attempt to bring the standard of the schools up to a reasonable level or build new schools, will they come under the axe? Can the Minister tell us that? Will they come under the definition of expansion as described by the Parliamentary Secretary? I say at once that if that is the case it will be impossible to bring these schools up to the requisite standard out of the block grant. In some counties the product of a 1d. rate varies from £600 to £800, and in many of them there is very little industry, so rerating will not make a substantial difference. Because of their very poverty they are backward in all the other services for which they will now be made responsible—health, child care, physical training and recreation and agricultural education, a vital national service.

I can tell the Minister that some of those counties have been kept solvent only by the Exchequer equalisation grant, and it is only the Exchequer equalisation grant and, of course, the percentage grant which have enabled those local authorities to improve and develop their education services so far. There is the block grant, but we do not know how much the grant will be. It remains a mysterious figure X. All we know positively about it is that there is nothing to prevent the Government cutting it down to whatever figure they think adequate, which does not inspire any confidence on this side of the House. There is the formula which will take account of scarcity as well as density of population, of children of various ages and so on, but it will not take into account the education needs of an area as against its resources which is the only valid test.

I am very glad to see that the Minister of Housing and Local Government—and Welsh Affairs—has now taken his place on the Front Bench, because I want to say to him that I do not believe the deficiency grants will benefit a single Welsh county. If he can tell me—and I hope that he will be able to do so—that the position of Welsh counties will remain even substantially the same under the block grant as it is today, that the Welsh counties will be able to carry out their development programmes, I shall welcome it. I am afraid that the Minister does not respond to my challenge.

At the same time, this change in grant offers a cast-iron alibi to reactionary authorities. It is more than that; it is an inducement to reaction. But to those authorities who are striving to improve and expand education of the children and to offer them a greater equality of opportunity in life this is one of the most retrograde steps ever taken by any Government in this country. There are still some people who think that too much education is a dangerous thing. It all depends on who has it.

The Minister of Education said that nobody had mentioned inflation. No Government can afford to neglect education. To do so is a very short-sighted policy from a national point of view. The national interest demands not cuts but expansion in education—and I am very glad to see that the Minister nods his head, and I hope that he means more than mere assent. When we consider the dramatic and impressive scientific and technical advances in the Soviet Union, a country which was largely agricultural in its most primitive form two decades ago, we cannot still fail to understand the vital importance of these services, not only to our efficiency and competitive power as a trading nation, but to our standard of living and to our influence as a great Power, which depends on our capacity not only to defend ourselves but to give that unique leadership which I believe we can still give to the world.

5.25 p.m.

Mr. Geoffrey Rippon (Norwich, South)

We have listened to the speech of the hon. Lady the Member for Carmarthen (Lady Megan Lloyd George) with great interest. She put her case as reasonably as it could be put, and I hope that she will forgive me if I do not follow her in her discussion of the position of the Welsh counties. I should like later to refer to some of the things she said about the maintenance of the standards of education. I respectfully suggest that she has not followed the debate in all its details, certainly on the subject of the police.

I was interested yesterday to hear the right hon. Member for Rochester and Chatham (Mr. Bottomley) referring to the position of the police and explaining why he thought local authorities in the Metropolitan Police District should perhaps be given some say in the management of the police. Then I realised that the right hon. Gentleman's experience of local government was a very long time ago. Indeed, his right hon. Friend the Member for Lewisham, South (Mr. H. Morrison) said in a speech at the end of July that he used to have similar views until he became Home Secretary in 1940. I should be interested to hear whether the right hon. Member for South Shields (Mr. Ede) has in any way changed the views which he held when he was Home Secretary. We must accept that there are very great difficulties in regard to the Metropolitan Police District, quite apart from the technical considerations to which reference has been made in the course of the debate.

This is not merely an education Bill. It is a Bill of very great importance to local government, and I hope that I shall not be thought to be digressing if I make some observations on the general principles. No one can doubt that since the end of the war there has been a continual weakening of local government as a result of the recasting by legislation of nearly all our major services, with very few exceptions. In almost every case that legislation has involved an extension of central control. Indeed, we must concede that this process has been rendered almost inevitable as a result of the disparity of population and resources between local government units of the same statutory type.

It is clearly impossible to secure any systematic reallocation of those functions in the way many hon. Members on both sides of the House want, unless we have a comprehensive review. I want to welcome the Bill first because it is designed to provide machinery to strengthen the structure of local government. At the same time, I think we all recognise that there has been a second cause of the weakening of local government, and that is the almost complete financial control by central Government officials of day-to-day administration.

I join with those who welcome the alteration in the grant system as a first instalment—to use the words of my right hon. Friend the Minister of Education—towards giving local authorities freedom to determine their local needs in accordance with their local circumstances. The issue between us was defined by the hon. and learned Member for Kettering (Mr. Mitchison), in his usual inimitable and vigorous fashion, when he spoke in the debate on the White Paper on 29th July. He said: What is to happen if this block grant goes through? The battle will be transferred from a battle between the right hon. Gentleman and the Treasury, or a battle between his Ministry and the local authorities, to a battle conducted on the floor of the council chamber itself, where the chairman of the finance committee—chairmen of finance committees usually welcome this sort of thing—will find a great accession of power. Those who are interested in education, in the tire service, in the health service, or in child care, will have to battle for what they can get out of the general grant. I believe that to be fundamentally wrong."—[OFFICIAL REPORT, 29th July, 1957; Vol. 574, c. 953–4.] I believe that to be fundamentally right. It is right that the collective view of the council should be paramount over the interests of particular committees. Listening to some speeches from hon. Members opposite, I have taken the view that they have borne in mind that Liberty means responsibility. That is why most men dread it. The hon. Member for Fulham (Mr. M. Stewart) denied that there were great weaknesses in the present percentage grant system. But the only evidence that has been quoted in support of that contention that there are no weaknesses, is the Report of the Institute of Municipal Treasurers and Accountants.

Mr. Lindgren

And general experience.

Mr. Rippon

I would suggest that the general experience of members of local authorities, which for this purpose is more valid than that of a particular set of officials, is to the contrary. It is worth bearing in mind that whatever the views of the Institute of Municipal Treasurers and Accountants, the local authority associations have generally welcomed the Bill—

Mr. Lindgren

No.

Mr. Rippon

—because from time to time over the years they have raised objections to the elaborate apparatus of grant claims, to the delay in the settlement of the amount paid, to the undue central control over details of a kind to which my right hon. Friend the Minister of Education has referred, and to the fact that the percentage grant system destroys much of the incentive towards prudent economy.

Mr. Lindgren

The hon. Gentleman is an experienced local government administrator, particularly in London, but all these statements are airy. Can he give one instance of any local authority with which he has been associated having been hampered in this way by Government interference? No instances have been given.

Mr. Rippon

It has been my continual experience. I would quote from a report issued by the National Association of Local Government Officers in 1951 entitled "Scope for Enterprise in Local Government," in which it was stated: There are two great advantages in a grant which is not tied to a particular service and which is variable in relation to the financial resources of an area. It is not likely to entail so much detailed control as a percentage grant, and it is likely to encourage authorities to rely on their own initiative, both in extending services and in supervising the efficiency of administration. A lot of hon. Members look upon "economy" as a rather dirty word, but I believe that efficiency in administration is essential if we are to make full use in the local authorities of whatever total sum may be made available to us. Within my own experience I know of local authorities that have carried out organisation and methods surveys. They come forward with a report that shows a saving of, say, £50,000. They are very pleased with it, and then it is pointed out that that is a gross amount and that the net amount of saving will be only £20,000. There is then a tendency for members of local authorities to say. "We do not want to give up the £30,000 that we got from the central Government."

Mr. G. A. Pargiter (Southall)

Can the hon. Gentleman give an instance of a local authority which has said that?

Mr. Rippon

It is a continual process. It is extremely difficult to get the recommendations of organisation and methods surveys accepted in these circumstances.

Mr. Lindgren

Coventry?

Mr. Mitchison

Norwich?

Mr. Lindgren

London?

Mr. Pargiter

As the hon. Member is unable to name one authority, is he willing to withdraw?

Mr. Rippon

No. I think hon. Members opposite will find that the majority of local authority associations, as distinct from various bodies and committees, have welcomed these proposals for the reasons which I have indicated.

Mr. David Jones (The Hartlepools)

Is it not true that all the national associations have merely accepted them conditionally, and that there have been no answers to the questions they have asked?

Mr. Rippon

I would accept that point of view in the sense that I believe the proposals are accepted conditionally, subject to the matters which I think we ought to be discussing, namely, the total amount of the grant, the method of providing adjustments to meet unforeseen circumstances and the formula for distribution. All these things are matters which we can usefully discuss. I think the educationists would have a far stronger case if they had put it forward on the lines suggested by the hon. Member for Fulham, instead of talking nonsense about tearing up the Education Act of 1944.

I concede that there is a great deal of force in a lot of what the hon. Member had to say about the formula. I think there is a need to provide some incentive to the good authorities, which I do not think is included at present. At the moment there is only pros is ion for a supplementary grant if the number of children under fifteen years of age is above the average. I should like to see built into the formula some provision for an additional grant where there are smaller classes, or where possibly there are more teachers, or where the number of children over fifteen still at school is above the national average, or in relation to university awards.

I think there is an argument on that ground, if a satisfactory formula can be devised, but I do not accept for one moment the view expressed by hon. Members opposite, that the largest grant should be given to the local authorities who spend the most money. I think a local authority, if it intends to provide services over and above a minimum or national standard, should have to weigh the cost of those services and the willingness of its ratepayers to finance them. I should have thought that would be a view which we in this House would all hold, because if the total sum is adequate there is no reason to suppose that education or the other services should suffer.

Why should not the House accept the assurance of the Minister of Education that we are not only going to maintain education expenditure at its present level but that we envisage expanding it? After all, the Education Estimates have risen by 94 per cent. in the lifetime of the present Government. I do not think that is a factor which justifies the suggestion that the Conservative Government want to cut education expenditure.

Mr. Lindgren

Much of the 94 per cent. increase was in interest charges.

Mr. Rippon

Not only that. The cost of school buildings, the cost per place, and so forth, have been reduced, so that the value for money spent has been greatly increased.

Mr. Mitchison

The hon. Gentleman will, of course, be aware that the Ministry of Education estimates of future expenditure already provide, and quite properly, for a very much larger sum than at present. For that reason, I find it difficult to attach much importance to the assurance that was given.

Mr. Rippon

I should have thought that the hon. and learned Member would therefore have attached more importance to it. We ought to bear in mind that when we talk of Treasury control in these matters we really mean Parliamentary control. One of the reasons why the standing of the House has been reduced in the minds of many people, if I may say so with great respect, and why the Executive power is so greatly increased, is that we in the House are no longer really interested in keeping a proper control over the level of public expenditure. It is greatly to be regretted that the Opposition is always urging the Executive to spend more money instead of exercising its proper function of controlling the total amount.

I would accept that the new general grant will not in itself weaken central control in many fields. That, of course, is quite apart from the provisions of Clause 3 (1) which gives the appropriate Minister the power to reduce the grant in cases of default. The House will recollect that the Local Government Manpower Committee was inhibited from making really effective recommendations for less Ministerial control because much of this control derives from statutes and the regulations made thereunder.

I would like to have seen in this Bill a considerable amount of amending legislation to reduce the controls which Ministers exercise in the field of local government, quite independently of this question of financial control. We must hope, however, that the proposed review will be treated as a matter of urgency. As far as education is concerned, the real teeth are not in Clause 3 (1) but are in the Education Act, 1944, which imposes upon the Minister a duty at almost every key point in the educational system.

The Children Act, 1948, and the Fire Services Act, 1947, appear to contain more references to the Secretary of State and his powers than references to children or firemen. That is not a wholly satisfactory state of affairs. As the Local Government Chronicle said on 20th July: It has been fashionable for post-war legislation to provide that local authorities carry out various functions under the general guidance of the Minister and in accordance with regulations of the Minister. General guidance is susceptible of many interpretations. A horse under the control of a rider in full control of bit and reins, whip and spurs, is under the general guidance of the rider, but the animal has little say as to the direction he shall go or the speed of his gallop. It all depends upon the severity of the rider. The analogy can be applied to Ministerial control over local authorities. The hon. Lady the Member for Carmarthen need have no fear that the standard of the education service, or of any other service, will be reduced by this first instalment of freedom to local authorities. If I have any criticism of the Bill to make, it is that it still imposes severe controls on the day-to-day administration of local government. There often are compelling reasons, from an administrative point of view, for this central control, but I believe that if a Minister tries to do everything he ends by doing nothing. For all practical purposes, when one reads "the Minister" in the Bill, one should read "an official", probably a principal of the Minister's Department, who has more power, in fact, than the democratically elected local authority.

What we need is a Measure which will bring back many of the things that have been lost to local government. I hope that the new Commissions will succeed in achieving that purpose. We must recognise, however, that the real battles over areas and functions will take place once the work of those Commissions is under way. I hope that the Minister will beware of too much compromise.

I have said that the local authority associations are in general agreement with the principles of the Bill. I believe that to be true, and I do not think that hon. Gentlemen opposite can deny it, though, in some senses, I regret it, because it represents the lowest common denominator of agreement.

The time must come when the Minister will have to take the decision as to what constitutes an effective and convenient unit of local government. It is probably as well that there is no definition in the Bill of "effective and convenient." All too often there is a conflict between the two conceptions. While I believe that there is undoubtedly a minimum below which a local authority should not be allowed to fall—the hon. Member for Brecon and Radnor (Mr. Watkins) gave a striking example of that yesterday—there is equally a maximum above which effectiveness falls off. I hope that it will be a cardinal principle guiding the Commissions that every local government unit shall be as small as is compatible with efficiency.

The new Commissions will start their work in an atmosphere more favourable than that which existed in 1948. They will have powers of review which the Labour Government denied to the former Boundary Commission, powers to carry out the job properly and effectively. I hope that someone has now told the right hon. Member for Lewisham, South why the Boundary Commission was dissolved.

The Local Government Boundary Commission in its Report of 1947 stated the right principle, that local government should be as local as possible. I believe that we should not have too rigid a standard as to population, it is wrong to write into an Act of Parliament a population limit, if it can possibly be avoided. I particularly hope that the Government will have regard to the views expressed in the 1947 Report on the subject of delegation. The Boundary Commission believed that the most-purpose authorities should be autonomous local education authorities and local health authorities. It may be necessary to have delegation in certain circumstances, but, in the past, that has meant little or nothing. All too often, we have found that approval had to be obtained in order to mend a tap or put up a new flagstaff, control being, in fact, exercised by some junior official at County Hall who took a rigid view of the instrument of delegation and was able to rule the roost. I hope that we shall move towards the exercise of functions as of right by local authorities.

I welcome the Bill as an important first step towards giving greater freedom and responsibility to local authorities. I appeal to those who have a vested interest in the status quo, of whom, I fear, there are some on both sides of the House, to contemplate fairly radical changes in the structure and areas of local government. If they resist those necessary changes, they will play right into the hands of those, of whom there are many, I believe, among the party opposite, who want to by-pass local government and conduct the local services through other agencies. We must create new areas and new structures. We must give the local authorities proper resources, and then trust them to get on with the job.

5.46 p.m.

Mrs. Freda Corbet (Peckham)

I am glad to be able to follow the hon. Member for Norwich, South (Mr. Ripon). We have certain sentiments in common and others in opposition. I should have liked him to give a specific example of the operation of the percentage grant being found to be hampering. The experience of my authority is quite the reverse. We have always been able to ascertain whether or not a project of ours would meet with approval without any difficulty. The only thing which has bothered us over the years has been the question of maintenance grants for children above school-leaving age. My authority waited for some years, until the report of the committee came along, to have some information on that matter.

As regards capital matters, which are quite different and depend entirely on the economic situation at any moment, being one thing one year and another the next, all local authorities, I think, have found difficulty.

I have always had a great deal of affection for the percentage grant, particularly when I noted the improvement in the work of the children's committees since the Children Act, 1948, and the establishment, for the first time, of a 50 per cent. grant in eight of those services. Before that time, those services were part of the Poor Law Services and, as such, did not carry a specific grant. We are all familiar with, and appreciate, I think, the tremendous developments which have come about in all local authorities in the provision for the welfare of children.

Education itself has, without a shadow of doubt, benefited from the percentage grant. Before 1919, there was a kind of per capita grant and no percentage grant. Since then, the education service has advanced by leaps and hounds to the position with which we are familiar today.

There is no doubt that the progressive authorities have found it extremely useful to be able to realise that, if they proposed some rather large item of expenditure, they would be able to recoup to the extent of 60 per cent. from central Government. My authority, as it should be, is one of those progressive authorities. It has an immense rateable value, and it has been able to experiment and set the pace in many directions. For instance, it has been in the forefront in the provision of evening institutes, school libraries and playing fields. It has encouraged music and drama and school journeys. There have been special courses in secondary schools to encourage pupils to remain beyond the age of 15.

My authority has all sorts of other plans. It would like to develop its system of nursery education. It wants to reduce the size of classes in primary schools, to develop a wide range of courses in engineering, building and commerce and other things in secondary schools, to carry out extensive improvements to old school buildings, to extend the playing-field provision and to develop further its activities in connection with music, drama and school journeys.

We are not likely to be afraid to do those things. I assure the House that a great deal of consideration goes into every item of expenditure that my authority, and, I am sure, other local authorities, embarks upon. It is not light-heartedly that new expenditure is undertaken. Not only the education committee, but the finance committee also, looks very carefully into all projects. The council does not incur the expenditure merely because its share amounts to only 40 per cent. There is no need for the Government to worry about extravagance by local authorities, for their 40 per cent. share of the expenditure is sufficient to deter any council from embarking on any project which it does not consider to be essential to the development of its service.

Education has been one of the favoured services in the post-war years. Education and housing have had top priority. There are other services—and they are included in the general grant proposals—which have had to take a back seat for many a long year but which are itching to develop themselves and ought to be developed. I think particularly of the welfare services and of the millions of old people who need so much done for them. There can hardly be a limit to the expenditure which would be in the interests of these people, but the councils cannot contemplate expenditure on the vast scale that is necessary.

One looks again at the health services. Have we reached the millennium so far as our health services are concerned? Of course not. There is a very great deal to be done. There are also the disabled and crippled, who are now the charge of the local authorities. This is a new service since the war. For them, too, a vast improvement of the service is required.

I assure the House that local authorities, when looking around, can be at no loss for plans of development on which to spend their money. In fact, they must be guided all the time by the feeling that they must go carefully, that they must gradually build up their plans and that they must refrain from increasing the rate beyond an amount which the electorate is prepared to stand.

Therefore, in the interests of the services, we ought to retain the percentage grant. It would satisfy most people who have an interest in the development of those services. Educationists, those concerned with the welfare of children and of old people and with the health of all of us, would be happy to know that if they could persuade their local authorities to spend the necessary money an adequate grant would be forthcoming from the Government, rather than he faced with the situation that if the local authority dares to spend the money it must do so at the expense of its ratepayers to such a large degree that it would be hardly possible to embark upon the development.

I was very interested to listen to the speech of the Minister of Education. He talked about the discretion given in the Education Act concerning the transport of children to school. We have been aware for some time of this discretion and efforts have been made to get the Minister to relax a little in his directions to local authorities. My authority cannot complain, because we got in in time for the Minister to relax his regulations, and in the payment of fares for transport we in London enjoy probably a better standard than most of the country.

Do I understand, however, that the Minister is saying that if the local authorities in general, exercising their discretion, relax their rules so that payment for transport became general for a distance of two miles rather than three miles, they would then be regarded as qualifying for extra general grant? If so, if the Minister goes on giving more and more discretion to local authorities, he may be sorry about it, but naturally enough, the local authorities will be pleased. We should like to know the answer to this.

Education, as we know it, is not an expendable service. The chairman of the finance committee of a local authority who is telling all the committee chairmen that the rate must be brought down and that there must be cuts, turning to the chairman of the education committee and asking him to contribute his share, usually receives the answer, "There is nothing we can cut. We are committed up to the hilt. There is so much for teachers' salaries, so much for this, that and the other and we have nothing whatever to play about with." Believe me, there are very few frills in education, unless some people say that a few pounds spent on a little music and drama is a frill and should be cut. But what difference would that cutting make to the enormous sums of money which today have to be spent on the education service?

I hope it can be realised that local authorities do not have the elbow-room to cut their services. If they want to cut, they must change their policy. On the whole, they cannot change their policy, because the Ministers, quite rightly, want to hold them to a reasonable standard. I hope that they will hold them to a reasonable standard. It is essential that the education service should be developed to the greatest possible extent.

We cannot, as things are, begin to imagine the kind of education which we shall be able to provide. We are not at the moment even building the proper foundation for the secondary education which the Act enjoins upon the Minister and the local authorities to provide. We cannot with the classes of the size we have to put up with, and it is essential to reduce the size of the classes to as small a size as possible and as quickly as possible.

I hope that we shall soon see the virtue of implementing fully the Education Act, which made provision for children to remain at school until 16. It is thirteen years since the Act was passed. Are we to wait the full twenty years before the provision of the Act relating to the school-leaving age is put into operation? I hope we shall not.

Meanwhile, there is one very important step which we can take, and that is to encourage children to remain voluntarily at school after they become 15. I am glad to note agreement expressed from both sides of the House to that proposition. I am proud to say that my own authority gives every possible encouragement to children to stay at school. One of the important things to do, of course, is to provide courses of a kind for which the children will be prepared to stay at school and for which their parents will be prepared to keep them there.

We cannot do that without the expenditure of money. Those progressive authorities which want to do that may find themselves, under this new general grant, having to pay a much greater bill than their resources can meet.

The Parliamentary Secretary to the Ministry of Education (Sir Edward Boyle)

I think that the hon. Lady will agree that public opinion has an important effect upon children staying on at school, and that it should be highly esteemed by public opinion, and I think she will agree, also, that the extended courses at secondary modern schools and public opinion must be efficacious as the years go on.

Mrs. Corbet

I hope they will be. I am only too glad to have some kind of assurance.

However, I was shocked only yesterday to hear of a headmistress who will not allow a girl to remain at school after the age of 15. I hope that the Minister will get busy about that, because it surely cannot be in accordance with his philosophy and his policy.

I wish the Minister could see that the greatest progress has been made when we have had the percentage grant. If educational associations and authorities are worried about this proposed grant it is because they have cause to worry. Personally, I would not care to trust the Government in a time of difficulty to make the general grant as large as it ought to be, even having regard for the provisions of the Measure. I should be suspicious that the Government might seek to stabilise, as it has been called, their expenditure. I am suspicious that the grant is intended as a disincentive to local authority expenditure. I cannot help being so, and there are many of us who sincerely share this feeling. I had hoped that the Government would have thought again.

It is all very well to talk about the freedom of local authorities to spend their money as they will, but surely it is inconsistent to talk like that and yet, when there is little scope for them to spend as they will, when it is so difficult to secure the money to do it, when there is so much to be done, to give them a grant which is of a certain size and which will restrict any extra expenditure in the future.

I am worried also about the town planning grant. The removal of nonconforming industry in the London County Council area has been estimated to cost a very large sum. I hesitate to say what exactly the sum is, because I cannot be quite sure the figure I shall mention is right, but I believe it was estimated some years ago at £300 million. By today it would be greatly increased owing to the depreciation in the value of money. The London County Council feels that it is making some effort to deal with this situation by setting apart every year£500,000, knowing, of course, that the Government would contribute their share.

What we have been asking for is an increase in the grant which can be given for these town planning purposes and, in particular, for removing factories from the London area. Many a time have representations been made to the appropriate Minister that we were going to close a factory whose owner had gone out of London and that we must have a larger grant than any which Ministers so far have been prepared to give. Despite all our hopes of getting a larger grant, all our hopes of doing something great in the decentralisation of London's population and of London's industry, which is absolutely essential if the population is to be at the level which is the desideratum, we are faced with a grant which, we fear, will only limit what we can do in the future.

I welcome the Royal Commission. It is felt that some consideration should be given to its set-up. There have been a number of reports dealing with this very difficult problem of London government. I myself sat on a committee which considered it some years ago. It was considering it in the London County Council area only. The committee came to the conclusion it was best not to meddle with the matter, that things were working not too badly at all, and that it would be extremely difficult to find better arrangements. Now the Royal Commission is to consider the problem in a wider area.

Within the administrative county there are a large number of authorities. Some of them are too small to be efficient. Some of them are large enough to be of county borough status. I wish the Royal Commission good luck in its very difficult job, but I hope it will not feel that it must provide a solution at all costs, and that it will make sure anything which it proposes will be better than the present set-up. I hope it will bear in mind the fact that a one-tier authority is the most satisfactory local government unit, if it is possible to arrange for it. I say this advisedly, because in London we have the two-tier system. There is very good cooperation between the London County Council and the Metropolitan borough councils. I deplore the supposition that the one is supposed to be the major authority and the other the minor authorities. We all of us regard ourselves as equals.

The two-tier system in London makes it extremely difficult for people to know to which authority they should go. Should they go to County Hall or to the local town hall? That division of loyalty between two bodies does not make it easy to obtain the kind of municipal patriotism and local interest which I am told exists in places like Birmingham, Manchester, and Liverpool, where there is a one-tier authority.

I should have thought, therefore, that in so far as it is possible to have a one-tier authority we ought to have it. I do not know that we can have it in London, though it may be possible on the fringes. If it were adopted in London the present L.C.C. would have to be a county borough. I believe that the L.C.C. could manage that, but I do not think that the existing boroughs inside the county boundary would like it at all.

When the Minister says that he has been advised to help get rid of inflation I must point out to him that I did not notice that that advice called upon him to get rid of the percentage grant. I hope, therefore, that he will reconsider this whole matter.

6.11 p.m.

Mr. R. P. Hornby (Tonbridge)

I listened with great interest to what I am sure everyone would agree was a very knowledgeable speech from the hon. Lady the Member for Peckham (Mrs. Corbet). I was mystified by one feature of her speech and of the speeches of many other hon. Members opposite. It caused me to wonder sometimes whether I had been projected some years ahead to a debate on a mythical block grant of the future which was thought to be far too small by many hon. Members opposite. Time and again many of their criticisms seemed to be directed at what they felt would be the total size of the grant rather than at the nature of the grant itself.

I know that a great many hon. Members want to speak and, therefore, I propose to be brief and confine myself to two points. The first is the general grant and its effect upon the relationship between central authority and the local authorities. The second is the relationship between local authorities and the public whom they seek to serve.

As to the effect of the general grant on local authorities, it seems to me that hon. Members opposite have been fearing two villains in this piece. Villain No. 1, and he is often cast in that rôle by hon. Members opposite, is the Chancellor of the Exchequer. In spite of what the hon. Member for Fulham (Mr. M. Stewart) said today, it seems to me that villain No. 2 is the local authority and the councillors themselves.

I should like to say a few words about the central Government and the Chancellor, or, rather, about the Cabinet acting collectively in this matter. In spite of their very genuine fears, I cannot see on what hon. Members opposite base their accusations that this proposal will mean a diminution in expenditure on education and other services. They will see from the figures for the last few years since our party has been in office that expenditure on education has gone up, whether from the point of view of expenditure per child at school or as a percentage of the national income.

Mr. D. Jones

Prices have gone up.

Mr. George Thomas (Cardiff, West)

Expenditure has gone up under the percentage system.

Mr. Hornby

Admittedly, but the percentage system and the new system are both decided in the light of Cabinet policy on education and other services.

Furthermore, if hon. Members opposite will study the pronouncements of successive Ministers of Education and other members of the Government, including the Chancellor of the Exchequer, and the statement made by the Minister of Education today, when he included the Government as a whole in his remarks, they will find that, as the Minister said, it is no part of our policy to reduce expenditure on education. My right hon. Friend added that it is no part of our policy to freeze expenditure at its present level.

I was delighted to hear him say that, because I agree entirely with what was said of education, most sincerely and convincingly, by the hon. Lady the Member for Peckham. We must look at education as the absolutely basic investment for the future of the country. Everything else that we do depends upon what we do for education.

Dr. Horace King (Southampton, Itchen)

In view of that statement by the Minister, does the hon. Member also remember the Minister saying that Birmingham will be financially better off because it has larger classes than any other authority in the country? Does the hon. Member not realise that that gives a financial inducement to lower standards?

Mr. Hornby

My right hon. Friend went on to say that he would look at the average level for the country. The Bill provides that the general grant to a local authority is looked at in detail before the total is decided. My hon. Friend the Member for Norwich, South (Mr. Rippon) had a point when he talked about trying to give some weighting to those authorities who had tried to meet their obligations.

Contrary again to what has been suggested by hon. Members opposite, another point about the effect of these proposals on local authorities is that the position of the Minister of Education in the Cabinet is likely to be stronger not weaker than hitherto. I say that because I believe that he will be in a position to give more definite advice and information as to what the exact financial requirements of local authorities are likely to be. In other words, he will be talking in relation to a definite figure and not the much more indefinite one which, as my right hon. Friend the Minister of Housing and Local Government said yesterday, was a perpetual worry which he knew from his days at the Treasury when the figures were constantly coming in late.

I cannot see that it is a disservice to education or to any other local or social service to make it easier rather than more difficult for the Exchequer to budget as efficiently as possible. Much as we want the best possible in education, we must also recognise that we cannot look at these things in isolation from economic policy. Therefore, I thought that it was completely right and honest of the Minister of Education to conclude his remarks today with a comment on inflation.

I turn to the other villain of the piece as suggested by many hon. Members opposite. I think that the argument of educationists and of so many hon. Members opposite amounts to the fact that they have no confidence in the ability of local councillors to administer these matters.

Mr. Short

Who said that?

Mr. Hornby

I cannot help feeling that it has been implicit in everything said from the opposite side of the House. I find it extremely puzzling when, time and time again, we have speeches from hon. Gentlemen opposite paying tribute to the many happy years they themselves have had in local government, and the pride they have taken in the work they were trying to do there, whether for education or for any of the other services. I cannot help asking myself why they assume that their successors in local government in the years to come will not have precisely the same pride in developing those services. I believe that hon. Mmbers opposite have merely become bemused by their desire to centralise everything.

Mr. D. Jones

If the hon. Gentleman will allow me to interrupt, I will tell him that it is precisely because we have had years of experience of municipalities whose levying of a high rate imposed an undue hardship on the people concerned because of the poverty of the authority under the circumstances of that time. We are afraid that precisely the same thing will happen again.

Mr. Hornby

Again, I say that there has been no evidence produced from the opposite side of the House that the amount forthcoming from the Exchequer will be less rather than more under this system.

Now I want to deal further with the rather gloomy picture of the local authorities painted by hon. Gentlemen on the opposite benches. It seems to me that they look at, say, the chairman of an education committee presenting his estimates, and they see him harried by many other councillors, not necessarily members of the education committee. They know that education is far and away the big-best spender. They know that there are a majority of councillors not on the education committee. They feel, therefore, that education, which has been the main bone of contention under this block grant, does not stand a chance in the council chamber.

I will make one or two comments on that. First, we have had from the Minister in detail his view of how he understands Clause 2 of the Bill, and my right hon. Friend also mentioned Clause 3, which contains the ultimate safeguards and penalties. If we look at this in detail, of course there will be detailed discussion in the council chamber of the expenditure of the education committee. Are hon. Gentlemen opposite really telling me that this is a bad thing? [An HON. MEMBER: "No, we are not."] Is it not true to say that some education expenditure is more important than other education expenditure, and is it not right that these things should be debated in any healthy local government organisation?

Mr. R. Moss (Meriden)

It is all a "phoney" argument.

Mr. Hornby

Of course, education committees prefer to go almost into a huddle with education officials about the way in which to spend their money and get this virtually cut and dried. They are dealing almost entirely with people whose business is education.

Mr. Moss

Does not the hon. Gentleman realise that the central and local authorities are a partnership in the great adventure of education? That is how we regard it, and we are now concerned with finding the best financial instruments to give effect to that partnership. There is no question of mistrust on either side.

Mr. Hornby

I have already tried to deal with my view on the financial point and I am glad to hear the hon. Gentleman say that he regards local authorities now as partners in the attempt to try to build education.

Mr. Moss

We always have done.

Mr. Hornby

It seems to me that in many of the criticisms made hitherto there have been assumptions that local authorities are not capable of devising their own priorities, of seeing that education is a service of enormous importance to this country and must be fairly treated by them inside the context of the grant they receive.

Perhaps I may make one other point. Of course, Sir Ronald Gould has every right to be anxious if he really finds cause for saying that education investment has been cut.

Mr. G. Thomas

He has not said that.

Mr. Hornby

It seems to me that he has gone off greatly in advance of any danger, that he has flown into a fright far earlier than necessary. I ask him to reflect that it seems to be paying a rather poor tribute to the teaching profession if he doubts its ability in the long run, to produce citizens who will recognise and vote for high expenditure on education when they become ratepayers and, maybe, when they become councillors.

Last night, the hon. Gentleman the Member for Wellingborough (Mr. Lindgren) regarded the crux of this matter as the relationship between the central authority and local government, and in this respect he described education as a national service locally administered. That view may not be far off a reasonable description of the position, but I do not see why we should always assume, as to some extent that definition does, that local authorities should have no say in policy making but should be concerned solely with administration. I believe that is one of the things which has lowered the interest in local authority work during recent years.

I much prefer the description in an article in the Economist last week which referred to this relationship and referred to local authorities as "half slave, half free." They are certainly slaves in that they have legislated upon them certain national standards which they must observe, but are completely free to go as far beyond those standards as they can manage, and free to apportion their resources subject to that limitation. If we look at the Bill in this light, if we recognise that we are not discussing the total amount of the grant but a Bill which is designed to invigorate and give more responsibility to local authorities, then we shall see it in a rather more kindly light than some hon. Gentlemen opposite appear to regard it.

I should like to refer briefly to the relationship of the local authorities with the public they serve. Everyone agrees that if local government is to prosper there must be keen local interest in it, shown by the willingness of people to take up the work of the local councils and by their willingness to find out what the local council is doing and to vote on these matters at election time.

I suggest that one thing not mentioned in the Bill could have a great bearing upon it, and that is the willingness of the local Press to report what goes on in the local council chamber and the willingness of local councils to give the local Press the maximum information and the facilities for reporting. There has been a movement in recent years to exclude the Press from many of the places where important decisions are taken and, in the last resort, I believe that that is a bad trend.

We all recognise that there are times when a committee must go into private session—it may be a matter of personalities being involved, or when officials who are not elected representatives and whose position is rather different have to give specific advice. However, I suggest that the relationship of the Press to local authorities is considerably important to the purposes behind the Bill and I ask my right hon. Friend to consider whether anything can be done in that direction.

Finally, I wish the Bill well and look forward to a vigorous debate when the sizes of the block grants come to be discussed. I wish that the educationists and hon. Members opposite had reserved their criticisms for those debates, which would have been the proper time for them.

6.31 p.m.

Mr. Ede (South Shields)

I have not viewed the advent of office of many Members of the Government with satisfaction, but when I recalled a speech which the present Minister of Education made from a place below the Gangway in a debate on education on a Friday. I thought that at last the Government had found a Minister of Education worthy of the great service he had to administer. After his performance at the Box this afternoon, I have revised that opinion.

When he was floundering about in response to an interruption by my hon. Friend the Member for Birmingham, All Saints (Mr. D. Howell) and he said that if one kept one's schools under-staffed one would make a profit under the block grant, I wondered what justice between the central and local authorities for education there could be with a policy such as that. It means that the best authorities, those who give the most fervent service to the cause of popular education, will get a little of their extra expenditure out of the slight rise which they will give to the national average, while all the people with no enthusiasm will get at least an equal percentage, because the former authorities have been zealous in their work for the service.

When the Education Act, 1944, was before the House, I had some slight association with it and I have always been proud that although my name is never mentioned in connection with the Act, there are some words in it which are mine. One of the words which is mine is "aptitude."

I was recently in Copenhagen giving a lecture on the Education Act, 1944. I wanted to get Section 36 translated into Danish. That Section refers to the duties placed on parents to secure for their children full-time education suitable to their age, ability and aptitude. I was told that there was no one Danish word which would cover "aptitude" as I explained it to the Danish translator.

When the right hon. Gentleman was sitting below the Gangway, he was a fervent advocate of the importance of "aptitude." The problem which confronts us today is that of educating and developing the inherent natural aptitudes of the great people to whom we belong. To develop the practical and scientific aptitudes is more expensive than developing those aptitudes which, up to the present, have had the highest value given to them in education.

One could always find out what was the average cost of educating a child in the old elementary schools and the old secondary schools. Authorities were compared on that basis. National and local policies were guided by it. But no one ever asked—and this is most astonishing—what it cost to educate a youth in a technical school or college.

Although I was never chairman of the education committee, I had frequently to defend the education policy of my county in debates in the county council. As I did not want anybody to spring a surprise on me by asking what it cost to educate a boy at a junior technical school, I asked for that information to be compiled. When I was given the figure, I told the official who had prepared it to burn it straight away, for I was certain that if it leaked out there would be an end to junior technical schools.

Technical education today means something far greater than anything of those days of thirty years ago. It is far more expensive. One of the great hopes of the country is the zeal now being shown by the parents of children in secondary modern schools to keep their children at school beyond the school-leaving age.

I was in Birmingham the other day formally opening a new comprehensive school. The headmaster and children had opened it two years ago and I rejoice that that sort of thing is now common. One is asked formally to open a school which is already a living institution. It was pointed out to me that one of the problems confronting the teaching staff and the education authority was the fact that all the original proposals about the number of forms in each year of school life had been completely destroyed by the determination of parents to keep children at school.

About six weeks ago, my hon. and learned Friend the Member for Stoke Newington and Hackney, North (Mr. Weitzman) telephoned me to ask me to be the principal figure at a speech-day at the comprehensive school in his constituency. It was obvious that I was not the first choice and that my hon. and learned Friend had been looking for someone whom he could lasso with ease to take the place of some far more distinguished person who had dropped out. I agreed to go, but the news appeared to have leaked out, because when I arrived I found the chairman of the London Education Committee, the leader of the London County Council and my hon. Friend the Member for Peckham (Mrs. Corbet), the chief whip on the London County Council. They were there to see that no heresies were uttered.

The most impressive thing which was said at that gathering was the report of the headmistress that 80 per cent. of the children stayed for a full additional year. That is the kind of education for which I have hoped in a career that goes back to when my right hon. Friend the Member for Poplar (Mr. Key) and I were pupil teachers together in London. We had hoped that there would be a zeal among the common people for education, a zeal which had nothing to do with the compulsory school-leaving age.

I deplore what my hon. Friend the Member for Peckham revealed—and I hope that it will be investigated—that in some school a headmistress has turned children out when they have reached the age of fifteen and has not allowed them to continue. That is quite illegal. Any child up to nineteen years of age can stay at a secondary school if the parents wish to keep him there. I am sure that the Minister desires that all parents who are willing to make the sacrifice and forgo their children's earnings should have that willingness used to the best advantage of the pupil and, I believe, of the school as well.

The hon. Member for Tonbridge (Mr. Hornby) said that he thought that there were two villains. The second villain was quite imaginary, but we have not seen the first villain either in the course of this debate. The Chancellor of the Exchequer has not turned up, but, of course, he is responsible for the policy. The Chancellor of the Exchequer said with regard to a statement just previously made by the Minister of Housing and Local Government: …we propose to introduce, among other measures, a general grant in substitution for a number of percentage grants. This should introduce a stabilising influence in the central Government's contribution to local expenditure."—[OFFICIAL REPORT, 19th February, 1957; Vol. 565, c. 210.] There was not much stabilisation in what the right hon. Gentleman said this afternoon. I gathered from what he said that we shall get more money under the new grants than under the old, and that nothing will be cut down. After all, they could hardly do that with school populations still coming from the primary into the secondary schools. If those words that I have quoted do not mean that a greater share of local government expenditure is to come from the rates in the future compared with what has happened in the past they do not mean anything at all. We object to the words: a stabilising influence in the central Government's contribution to local expenditure. I believe that the Education Act, 1944, established on a firm basis a working partnership between the Ministry of Education and the local authorities in which each bore an agreed proportionate share of the expenditure roughly working out to 60 per cent. by the central Government and 40 per cent. by the local authorities. In future what will happen is this. The block grant is the Government's contribution. Having made it, they go to sleep. The local education authority carries on the service and has to meet everything that is incurred. That is the stabilising influence in the Government's contribution to a local authority.

The Minister of Education will not count for very much in the future. He did not even understand his own position under Clause 3. He will not withdraw the grant if he thinks that a local authority has not come up to standard. "The Minister" in the Bill means the Minister of Housing and Local Government, according to the definition Clause. But there is another person in the Bill referred to as "the appropriate Minister", and the appropriate Minister is no better than, in fact, he is not as good as, the Parliamentary Secretary to the Ministry of Housing and Local Government. The Minister of Housing and Local Government will go round the country, and say. "I do not think much of the children coming out of this school. The education being given here is not very good. I think we had better liven up this authority by telling them of our displeasure." He deducts the grant and then writes to the Minister of Education, saying, "Have you any objection to my deducting the grant?" That is the effect of the proviso in Clause 3 (1), which reads: Provided that where the Minister is not the appropriate Minister he shall not act under this subsection except on the certificate of the appropriate Minister that that Minister is satisfied as aforesaid. Everybody will now know why the police do not appear in the Bill. Fancy the Minister of Housing and Local Government deciding that he will deal with the police grant. We may be sure that when the police grant is dealt with, then it is dealt with. The Home Secretary withdraws the lot. Every Home Secretary seems to do it once in the course of his career. I did it, and my right hon. Friend the Member for Lewisham, South (Mr. H. Morrison) did it. One of the Home Secretaries since I left office has done the same thing. Fancy writing to the Minister of Housing and Local Government! He is a mere—

Mr. D. Howell

Bagatelle.

Mr. Ede

No. He is a mere creation of the second half of the twentieth century writing to the successors of Cecil and Walsingham saying, "I propose to muck about with your grant". It is no good saying that there are technical reasons why the police cannot be brought in. The reason is that no Government, particularly one representing the property-owning class, will part with the most stringent control over the police services.

That is one example. If there was a recalcitrant authority—we all know that they exist—when one was in the old Board of Education, one always said regarding approximately three counties, "They will always be the last to do anything proposed". It is said of one Welsh county that as soon as a financial crisis arrives they always present a most extravagant and grandiloquent development plan well knowing that it will be turned down and that they will get credit for the thought without having any of the responsibility for giving effect to it. So the Minister hopes that if he has to deal with a recalcitrant authority he will be able to write to the Minister of Housing and Local Government and say that such and such authority is giving him trouble and trusts that the Minister will deduct from its grant a sufficient amount to make it understand how severe is his displeasure.

Mr. Geoffrey Lloyd

With his great knowledge of the Act, the right hon. Gentleman will know that there are many other powers in the 1944 Act which have been more habitually used for, if I may use the phrase, the encouragement of authorities of the kind he mentions. I believe that the actual penal power of reducing the grant has been used only once in the history of the Act. Therefore, it is very much a question of being the last resort.

Mr. Ede

Once was enough. But the Minister does not have the power now; it does not rest with him. The Minister of Housing and Local Government may well have regard to the general effect of the Minister's request on the relationship between himself and the local authority concerned.

From his seat opposite me in the House yesterday the President of the Urban District Councils Association told us what his Association had decided about the Measure. I am President of the County Councils Association. It is unfortunate that this two-day debate comes before the meeting of the Executive Council which is being held tomorrow, but in July the Association, for whom I am not speaking in this debate—I am speaking for myself—said that it had no objection to going over to a block grant provided that it was told certain things before it happened.

Correspondence has taken place between the Association and the Ministry on this matter and I want to read a paragraph from a letter submitted by the Association, together with the answer it received from a Ministry official. The Association says that the local government finance committee of the County Councils Association would regard a very substantial removal and relaxation of existing controls as a condition precedent to acceptance of the proposals. The right hon. Gentleman made it quite plain that he was not going to make any very big reduction in controls. The list that he gave out was not one which he would expect to satisfy any association which had used the language that I have just quoted. The letter goes on: As you know, talks are proceeding—having opened none too favourably—and beyond saying that we wish them to be ended sufficiently before the debate on the Second Reading of the Bill to enable the Association to take the result into consideration, I have no present comment. This is the answer that was received: We shall be letting the Association have, in a very few days, a series of papers on control of investment, borrowing and loan transactions. Whether we shall be able to reach with the local authorities firm conclusions before the Second Reading debate I am doubtful—particularly if that debate comes before the Christmas recess as is possible. However, I hope that we shall have done enough by then to convince your members that the Government genuinely desires to increase the independence of local authorities as far as it is possible to do so in the world in which we live. The Association does not ask for guidance as to what it is to do in the next world. We shall meet none of the Ministers there. The reply goes on: As I explained to you at our talk, it is no use hoping that the Government can, in present circumstances, relax control over capital investment; nor is it realistic to ask individual Ministers to abandon their overall responsibility for progress on particular services. The idea of 'minimum standards' seems to me to have only a limited application. I was once at a meeting to elect a new county councillor when the candidate addressing the meeting, who was a farmer, was asked, "Do you believe in minimum wages?" The farmer said, "I always pay them." The letter continues: what 'minimum standards' could we apply, for instance, in the field of water and sewerage? There is no end to the improvements that could be justified; we are compelled to judge relative urgency. Meanwhile the Minister must be prepared to answer to Parliament for the rate of progress; he must be prepared (if necessary) to ask a local authority to get on with a scheme which he believes to be urgently necessary—maybe for industrial purposes—while at the same time telling others that work they would like to do must be deferred. This is freedom. As the French lady said: O liberty… O liberty… What crimes are committed in thy name… The letter ends: The same must be true in many other services. We will do the best we can"— Fancy that lot opposite promising to do the best they can…

Mr. D. Jones

They are doing their best.

Mr. Ede

Then one would like to see their worst, sometimes, if only to compare the difference. The letter goes on: We will do the best we can to free local authorities from any unnecessary controls, but we must ask the representatives of authorities to recognise the real limits to what we can do. We must also ask you to be patient. There is a great deal of ground to cover, and we must give priority to the Bill. Get the Bill, and then what will be the use of anyone complaining that the counterweight of freedom is inadequate?

My hon. Friend the Member for Oldbury and Halesowen (Mr. Moyle) said yesterday that the Bill was the county councils charter. I do not see that myself. I do not see it as a charter for any local authority. We get back to what the Chancellor of the Exchequer said at the beginning, about the need to stabilise the contribution from central Government sources to local government expenditure. The Minister of Education, of all Ministers, knows that if we are to catch up not merely with the Russians but even with the Americans—who are a long way behind the Russians—we have a very stiff and hard struggle. That struggle will be decided not in the universities and technological colleges; it will be decided in the primary and secondary schools, where alone we can prepare a generation which will have the minds capable of grasping the tremendous opportunities that await a well educated nation which makes the best use of all its aptitudes.

6.57 p.m.

Mr. Brian Harrison (Maldon)

I do not propose to detain the House for long, but I want to refer to some of the points which have been made and to the misinterpretations of the Bill in various quarters. Yesterday afternoon I was interested in trying to find just what the party opposite would do in the way of reorganising local government or altering it either financially or structurally. It was extremely difficult to discover any coherent suggestion, other than that industrial premises should be rated at 100 per cent., and that agricultural land should also be rated, as a financial contribution.

Although an alternative may not really have been put forward yet, people realise that something must be done to introduce into local government organisation and finances a method capable of dealing with present-day conditions. Previously, the amount raised by rates was usually far in excess of the amount which came, by way of grants, from the central Government. The emphasis has now completely changed, so that by far the biggest amount of money spent by a local authority comes from the central Government. This means that the whole responsibility—especially when the expenditure of the money is earmarked, as it is, on a percentage basis—is being taken away from the people who are running local government. I have often heard complaints that they are just rubber stamps.

I do not share the fears expressed by a number of hon. Members which can be based only on a very low opinion of the type of person who becomes a county councillor. The impression is created that these people are unable to appreciate the importance of education and of the various services which are the responsibility of the local councils. One would imagine that the councills proposed to do away with such services and to spend the minimum amount of money possible upon them. I find it difficult to believe that local councillors are so short-sighted and narrow-minded, particularly when we note the number of hon. Members who have had experience in local government work.

The block grant method will make for more careful and less wasteful spending and that will prove an advantage not only at the local level, but generally. If by having the power to allocate money councillors are able to see how it is expended and that they get full value for it, it will be to the advantage of everyone. A speech made yesterday by an hon. Member opposite left one with the feeling that limitless expenditure always leads to limitless improvement, but that is a fallacy. What is required, and what this method of block finance will provide, is real value for money and thrifty expenditure, in order that the best possible services are available within the resources of the country.

The point has been made about industry not being fully rerated. There is a sound reason for that. Previously industry carried 4.19 per cent. as its share of the rate burden. With the revaluation, plus an increase in the percentage that it must pay, the burden has gone up by 50 per cent. to 6.27 per cent. Such an increase at a time when industry is becoming a great deal more competitive is as much as we can expect it to absorb.

Another matter to which I wish to refer is the reorganisation of the various areas. We in Essex will suffer from a long time-lag because it will not be possible for much to be done until the Report of the Royal Commission is available. That is probably a good thing, because there are some extraordinary problems in Essex by reason of the variety of local authorities. I was glad to see that under the terms of the Bill no county council may propose the abolition of a non-county borough. There are a number of small non-county boroughs which are very proud of their traditions and their contribution to local government. I ask that the Minister, where he can, will advise that these boroughs should not be pompous parish councils looking after a few people but be integrated by the county councils into a larger unit and form the peg on which to hang larger units within the county areas.

It may be necessary for the Minister to use his powers to extend the special review areas to a much greater extent than is at present envisaged. There will be a certain amount of rivalry and jealousy within the county council areas which may make it difficult to arrive at a useful solution about reorganisation. We should remember the long time which has elapsed since the last big reorganisation, and that probably this one will have to last just as long. County councils must be given an opportunity to suggest how local government in their areas can be most efficiently organised. The Minister should lay down principles, or give some indication of the lines upon which he expects county councils to work, in a more definite manner. If it is not possible for a county council to bring a particular form of reorganisation into existence, it should be up to the Minister to establish a special review area and to create a form of organisation which will work.

Knowing the number of councils that I do, and that the gross amount of finance coming from the central Government will not be less than they are receiving at present, I have every confidence that the block grant will be adequate, and, ultimately, that it will lead to better value being obtained for the money spent at county or local authority level so that people receiving the services will benefit. I welcome the Bill because of the plan to reorganise local government which it contains. I hope that some sound and long-lasting form of local government reorganisation can take place, because it is essential for loyalties to be built up in order that it may work successfully, and for there to be long periods of unity and stability.

7.10 p.m.

Mr. George Thomas (Cardiff, West)

The hon. Member for Maldon (Mr. B. Harrison) has revealed an unusual lack of faith in local government in this country. He has submitted that there will be more careful spending if local authorities have the present percentage grant taken away from them. I have far more faith in the work of the local authorities with the percentage grant than have the hon. Gentleman and his fellow Government supporters.

This Measure has succeeded in uniting educationists in this country to an extent not achieved for many years. The last time we had employers and employees, local authorities and teachers, sharing the same campaign was when the 1944 Act was about to be introduced. Last week, I listened at a most remarkable meeting to Dr. Alexander, the General Secretary of the Association of Education Committees, to Sir Ronald Gould, of the National Union of Teachers, and Mr. Shearman, of the L.C.C., each of whom was able to speak on behalf of the great sector of the educational world to which he belongs.

The campaign has brought support which crosses all party barriers, and that fact is not without significance. The Minister of Education will be aware that some of his leading critics in local government are leading Conservative councillors. In Cardiff, Alderman Robinson, the Chairman of the Education Committee, is a devoted member of that party. The Minister will also know that Alderman Robinson went on record publicly, along with Mr. Frank Barraclough, the Director of Education for the North Riding, who also publicly expressed his devotion to that party, as expressing profound disagreement with the educational policy which is being pursued.

No Government have a right to ride roughshod over such unity among the people concerned for a great social service. The concern of these people is not political. Sir Ronald Gould and Dr. Alexander are not men of straw, blown with any wind of opinion. They are people to whom the country listens with respect. It ill becomes the Minister to brush aside the lifelong experience of such people in the manner that he has done.

The Government have no mandate for the Measure. There was no mention of it in the last General Election campaign. The very opposite; for Sir Anthony Eden came to the wireless for the only broadcast talk of the campaign that I heard, and promised expansion of education. Expansion is possible under the percentage-grant scheme, but no one on the Government Front Bench can deny that the Bill is a death blow to an expanding education service.

Mr. Geoffrey Lloyd

Yes, I can deny it.

Mr. Thomas

The Bill is a breach of faith with the electorate. Nobody outside the House wants it, and I have observed that Government supporters who have spoken in support of the Bill have done so in a qualified way. They have all indicated parts of the Bill which they believed held dangers.

Why has the Bill been introduced at all? Is it to tidy up local government? That is the smaller part of the Bill. The real aim of the Bill is to reduce the social service of education without the public's realising what is happening. The Government lack the courage to make a frontal assault on the education service; they hope to succeed with this indirect attack in halting expansion in the service.

I can understand the teachers of the country being concerned about the service. They have been sending letters to hon. Gentlemen on both sides of this House. The teaching profession is non-party political. I would like to see them, for obvious reasons, more party political. I believe that the Tories are always the enemies of education and of educational advance and I wish that teachers would always agree with me on that point.

The hon. and gallant Member for Nottingham, Central (Lieut.-Colonel Cordeaux) has, in a burst of candour, revealed the real purpose of the Bill, according to his judgment. He told the teachers of Nottingham: There can be no doubt that the adoption of the block grant will effect very great economy in the former sphere. The "former sphere" is local government expenditure. I feel there is no doubt at all that local authorities, like everybody else, look very differently at a project for which they must foot the entire bill than at one for which somebody else will pay half, or even more of the cost. He maintains that this Measure is in the interest of economy.

The percentage grant scheme was intended to encourage progressive authorities to raise rates to spend on education. After all, local authorities have not been spending Exchequer money without spending their own. For every £60 from the Exchequer they have had to get £40 from the local rates. There is no suggestion of gay abandon on the part of local authorities because they were having something for nothing. Not at all. Education is already the heaviest single item in the rates of local authorities. It ill becomes Government supporters to suggest that local authorities have been careless in the spending of money.

The Minister of Housing and Local Government, like a bad penny, keeps cropping up in all the unpopular Measures. He has indicated, with the Chancellor of the Exchequer, that the aim of the Bill is to stabilise educational and local government expenditure. With his new found authority over the realm of education he is going to put technical education outside the Bill, but it is no good this House thinking that technical education can be isolated from the rest of education. It is only in the next few years that technical colleges, isolated by grant from the rest of the education service, will be able to rely upon a proper supply of adequately educated people from the rest of the service. When the block grant takes effect in the primary sector of education it will be bound to affect technical standards. I believe that the Minister will do grave damage to the educational system of this country.

The Prime Minister has referred from time to time to the "Opportunity State." Apparently the cornerstone of the new "Opportunity State" is to be inequality in education, because in future the opportunity of children in matters educational will depend on whether they live in a wealthy part of the country or a poor part of the country. If they live in the poorer areas of the country, which cannot afford to add to the rates a little extra expenditure for educational advance, then, however gifted a young person may be, he will not have equality of opportunity to advance his talents. When we deny equality of opportunity to our young people in these islands we withhold from the nation its chief asset, because we do not know whom we are holding back. When we hold back the young people of working families, we may be holding back some of the most gifted members of the community.

This Measure, introduced by the right hon. Gentleman, was the dream of other people before him, of Geddes, May and Ray and of all those who have sought economy in education. The case has been well made out on both sides of the House and what can be said in favour of this Measure has been said. A great many arguments have been brought against it. I want to address a few personal words, which I do not take any pleasure in saying, to the right hon. Gentleman the Minister of Education.

My right hon. Friend the Member for South Shields (Mr. Ede), who speaks with authority in this House and who is the joint architect of the 1944 Act, hailed the speech of the Minister of Education on a Friday a little while ago. I believe that the Minister of Education was given a new stature and a new authority by the passing of the 1944 Act. We had a President of the Board, then we had a Minister with new and added powers. The 1944 Act gave status to the Minister of Education because it gave him powers. This Bill takes away his biggest power. Any Minister with self-respect would resign rather than accept the humiliation of a Measure of this kind.

The Minister of Education may laugh but I have a few more things to say which may help to take the smile away. Lord Hailsham, who left the Ministry just in time, made, during his brief tenure in the office which the right hon. Gentleman now holds, brave speeches. He said that he was spoiling for a fight with those who spoke of expensive frills in education. He could have a fight with a few of the hon. Members opposite who have spoken for their party. He maintained that the education service must expand and not be contracted. Those were brave words. They were his last words at the Ministry.

Mr. Cyril Bence (Dunbartonshire, East)

Before the bell tolled.

Mr. Thomas

Yes. It was clear that the noble Lord could not be kept at the Ministry of Education when this Measure was to be introduced. There would have been trouble in the party opposite. Clearly he would either have had to go back on all his public utterances or the Bill would have had to be modified considerably. What did the Government want in the place of the noble Lord? They wanted a Minister who was pliable, obliging and obedient; a Minister, in short, who would swallow anything and stay in the Ministry. The price of the right hon. Gentleman's office is too high for the nation to pay. It is rather a tragedy at the present time that when the Ministry of Education needs a fighter, it has the right hon. Gentleman.

The tragedy of our education service is that the inheritance for which my right hon. Friend the Member for South Shields and others have fought, a Ministry that counted in the Government, is being sold. The heritage is being sold by the Minister, who apparently feels that, whatever happens, he will not go again to the place from which he has just been rescued.

In my judgment, the Bill holds a possibility of doing more grievous damage to the education service of the country than anything else in my lifetime. It is because of that that I have spoken as sharply as I have to the right hon. Gentleman, who ought not to be defending this Measure, but leading the campaign against it. In our hostility to this Measure we on this side of the House are speaking in the best interests of the future generations of this country.

7.25 p.m.

Mr. Nigel Nicolson (Bournemouth, East and Christchurch)

While the hon. Member for Cardiff, West (Mr. G. Thomas) was speaking I was glancing at the Amendment which the Opposition have proposed against the Second Reading of the Bill. Having sat here throughout most of these two days, I have heard very little mention of any part of the Amendment except for the penultimate sentence. Hardly any hon. Member opposite has hacked up the complaint that the Bill does not fully re-rate industry and that that will have pernicious effects on the financial difficulties of local authorities.

There has been very little mention of the alleged difficulties which will be met by the health services. The whole attack has concentrated, as did the hon. Gentleman's speech, on the effects, as hon. Members opposite see it, on the education service of the country. It seems rather strange that it should be assumed that any Minister of Education of either party should wish to leave the service in a more parsimonious or feeble state when he leaves office than when he entered it. Our education service at the moment is being carried out under an Act which bears the name of a leading Conservative Minister. It is popularly known as the Butler Act. What possible reason could there be for the Minister of Education or the Minister of Housing and Local Government, or of the Cabinet as a whole or of the Chancellor of the Exchequer, to cut down this service which we regard as a basic one of the country?

I truly believe that hon. Members opposite have placed themselves in a quandary. They do not really believe in this Amendment. They do not really dislike this Bill as much as they say they do. In six months' time they will have forgotten all about it. [HON. MEMBERS: "No."] The average ratepayer will not notice any difference at all in the situation before and after this Bill becomes an Act. I wonder what the attitude of the Opposition would have been if the purpose of the Bill had been the very opposite, if instead of replacing a system based upon the percentage grant we were proposing to introduce a system based upon it.

If we were proposing to introduce a percentage grant, having hitherto had a block grant, I feel quite certain the Opposition would have advanced precisely the same arguments. They would have said that we were striking at the root of local government. They would have said that we were not trusting the average councillor and alderman to make good use of the money at their disposal. They would have said it was outrageous for a Government to suggest that no money could be spent on any of these services unless the Government agreed, after investigation, to supply the other half of the money. They could have made a far better case that the services were being undermined if the Bill had suggested the opposite.

I am rather surprised that hon. Members opposite, a large proportion of whom represent mining and industrial towns, should be so disturbed at these proposals, for it is their constituencies which on the whole are the better off from the point of view of Government grants both under the percentage and block grant system. It is no longer Cheltenham but South Shields which is the aristocrat; no longer Bournemouth but Cardiff.

Mr. G. Thomas

We do not get anything.

Mr. Nicolson

Those towns obtain through the rate deficiency grant and the rate product deduction advantages which are not open to the other type of towns which I have mentioned. The hon. Member said that it was the poorer towns, seeking to instance his own, which would be at a disadvantage, but it is the other way round.

Mr. Thomas

I am sorry to interrupt, but I want to put it on record that Cardiff is one of the planning authorities which gets no help from the equalisation grant.

Mr. Nicolson

I apologise to the hon. Member for Cardiff, West for taking his constituency as an example, but he knows very well the point I am trying to make. On the whole, at the moment and under the provisions of the Bill an attempt is being made to iron out those inequalities of income throughout the country and to provide roughly the same service in each of the categories of local government to each locality. What has hitherto been the object will be maintained under the provisions of the Bill.

The hon. Member for Fulham (Mr. M. Stewart) said that many of us on this side of the House while initially paying lip service to the Bill had introduced a note of grievance on behalf of our own authorities. That is exactly what I am going to do, because, while I welcome the Bill, I feel it is hard on a special category of towns, one of which I represent in this House. If we looked at the Bill, particularly the second part of the First Schedule, which sets out the formula by which the general grant will be sub-divided, we could easily discover what type of town stood to benefit least. It would be a town in which there was little industry, in which there were few children, in which there were many old people, a town to which there was a constant influx of non-ratepayers who made use of the services but made no contribution towards them, a town with exceptional burdens upon the rates, and, finally, a town where the properties were highly assessed compared with the average in the country.

All those six disadvantages are found collected together in the type of town for which I now speak, resorts which attract both the holiday maker and the retired person. They have next to no industry, they have few children compared with the national average, they have an exceptional number of old people, they are subject to very heavy and totally exceptional rate burdens to maintain, for example amenities which for them are an essential while for other towns might be regarded as a luxury. They have to pay heavy charges in respect of coast erosion, and in the last few years they have had to be very concerned about the discharge of sewage into the open sea. They have to spend, if necessary, millions of pounds on relaying an entire sewerage system to draw sewage inland away from the bays. Finally, they are assessed exceptionally heavily because it is not so that the latest rating provisions have equalised assessments all over the country. If one goes to the south coast of England one finds that an average bungalow or boarding-house near the sea is rated considerably higher than the equivalent building or accommodation inland.

My main grievance is connected with the education grant as it affects such towns. The formula allows for children three times over. First, there are the under-fives; secondly, the under-fifteens; and, thirdly, the number of schoolchildren per thousand in the particular locality. A town with comparatively few children is therefore at a triple disadvantage. But not only that. We have few children but have an exceptionally high number of old people. Old people take a disproportionate amount of money to maintain compared with the allowance made for them in the weighting formula.

I wish to draw my right hon. Friend's attention to one particular item in the example which he gave in the White Paper. It is stated that only those local authorities which have more than 120 children per 1,000 population will qualify for any supplementary grant for education. There are four county boroughs, all of them resorts, and one county council—East Sussex—which have fewer than 120 children per 1,000 of the population. Those boroughs, of which mine is one, cannot understand why this figure of 120 was chosen. It does not matter whether one falls below it by a few hundred, a few thousand, or by one child, one still gets nothing. It could happen that the addition of a single child would make a difference of many thousands of pounds to what that borough received by way of supplementary grant.

Although 120 per 1,000 is not specifially mentioned in the Bill, the formula which allows for such a figure is incorporated in the second part of the First Schedule. There it is said that the calculation will be based upon the total population of the boroughs multiplied by the figure by which the child population exceeds so-and-so per 1,000. I cannot see that the population of a borough is in the least relevant in that connection. It does not matter what the population of the borough is; what matters is the number of children. Could not that part of the Schedule be recast to allow more directly for the cost of educating the children?

Taking the figures given as an example in the White Paper, we see that every borough which has a number of children in excess of 120 per thousand stands to benefit very greatly, receiving a great deal more than the cost of educating those children. It would mean about £60 per child, whereas, taking the last year for which I have figures, 1955–56, it cost only an average of £30 to educate a primary school child and £51 to educate a child of secondary school age. Thus, those boroughs which are fortunate enough to have a great many children are benefiting by a fantastically disproportionate amount from the formula as at present devised.

I ask my right hon. Friend to look again at this figure during the Committee stage in order to see whether he could not take into account the peculiar difficulties of the resort towns, which may appear to some hon. Gentlemen to be of the richer type but which, in fact, stand to lose very greatly by the formula if it remains unamended.

7.40 p.m.

Mr. Edward Short (Newcastle-upon-Tyne, Central)

I hope that the hon. Member for East Bournemouth and Christchurch (Mr. N. Nicolson) will forgive me if I do not follow his remarks except to make one observation. He said that, when the block grant started, the ratepayers would not notice any difference. That is probably quite correct. What we are afraid of, and what our battle is about, is what will happen when the block grant has been operated for two or three years. It may well be that, by that time, the ratepayers will be faced with an extra 7s. or 8s. in the £ in their rates because of the block grant.

I am sorry that the Minister of Education has left the Chamber, because I wanted to put two things to him; perhaps his hon. Friend the Parliamentary Secretary will convey them to him. First, I wish to tell him that, if I had any doubt about the danger of the Bill before I listened to him, I have none whatever now. Secondly—a very minor point which I should like to have on the record—the Teachers' World, in ownership or control, has no connection whatever with the teaching profession. His quotation has nothing whatever to do with the teachers.

I want to deal briefly with three points, on the first of which I am in general agreement with the Minister, on the second of which I am in general disagreement, and on the third of which I am in violent disagreement with the Minister. I will deal with them in that order.

I agree with the Minister about the proposal for the special review areas. My constituency, Central Newcastle, is bang in the middle of the first review area. The whole area is about 15 miles long and 8 miles wide, and in the 15 miles, with the River Tyne in the middle, there are 15 local authorities, some county boroughs, some boroughs and some district councils. There is a tremendous duplication of services there. The whole area—which the Minister himself visited a few days ago—is, quite obviously, one physically, socially and industrially. Nevertheless, local government in a good many cases within the area still follows the old medieval boundaries. In this streamlined age, when the primary need in almost every phase of life is to make ourselves more efficient, we cannot justify this wasteful method of administration.

Apart from the administration being duplicated and wasteful in an area such as my own, the present situation makes over-all planning extremely difficult. I know, for instance, that my hon. Friend the Member for Newcastle-upon-Tyne, East (Mr. Blenkinsop) is very interested in the condition of the River Tyne. The Tyne is one of the most heavily polluted rivers of the country, but one of the great difficulties in bringing about any improvement is the multiplicity of local authorities concerned.

Housing provides another example. I believe that the solution of the Tyneside housing problem would be found in the establishment of a new town, and that would be made very much easier if there were one authority. In many other ways, for example, in the development of the Tyne port facilities, the same argument is seen to apply.

I welcome the Government's proposal, but I have two points to make about it. From what I have seen of the Bill, although there is a time limit for local authorities to make representations, there is no time limit for the Commissions' work in inquiring into the five special review areas. I should have thought that some time limit, even up to five years, let us say, would have been a good thing.

Further, I implore the Minister not to allow any vested interests to stand in the way of some sort of reorganisation when something does emanate from the Commissions. I am quite sure that senior officials very often generate much opposition to proposals for local government reorganisation; they are concerned with maintaining their own small empires and, very often, they present difficulty in the way of reorganisation. I am glad that the Minister is not committed to any special pattern. For myself, I should like to see a new kind of local authority emerge in an area like Tyneside. What emerges there, obviously, might not necessarily be suitable for any of the other four areas, and I am glad that the right hon. Gentleman has made it clear that he is not wedded to any special type of authority. Here, my agreement with the Minister ends.

I want to say a word now about the Exchequer equalisation grant, to which the hon. Member for East Bournemouth and Christchurch referred. The County Borough of Newcastle is one of such boroughs which does not receive the rate equalisation grant. Even with the extension of this grant, under its new name of rate-deficiency grant, to county districts and Metropolitan districts, our objections to the grant remain. So long as a large part of the Exchequer grant to local authorities is distributed according to rateable value, even if it be distributed according to rate product, the rate-deficiency grant cannot operate equitably.

This inequity in the distribution of the grant will continue, it seems to me, so long as there is 100 per cent. derating of agriculture, 50 per cent. derating of industry and 20 per cent. derating of commercial premises, and so long as there is no uniformity, as the hon. Member for East Bournemouth and Christchurch pointed out, in assessment throughout the country, there being a disparity in rateable values for similar properties in different areas. Some authorities receive compensation for these factors under the rate-deficiency grant, but others, including my own, do not. I give the Minister notice now that many points about the position of authorities which do not receive a grant will be raised in Committee. I do not wish to pursue them now.

I come now to my third point, on which I violently disagree with the Minister. He complained yesterday that the main opposition to his proposal in Part I of the Bill had come from the teachers and those concerned with education. But, since £9 out of every £10 of the grant will go to education, there is nothing very remarkable about that. As my hon. Friend the Member for Cardiff, West (Mr. G. Thomas) pointed out, the education world, both teachers and administrators, is united as it has never been before. Those of us who have been teachers spent a large part of our professional lives trying to create some professional unity among teachers. This is the first occasion I have ever known the N.U.T. and the National Association of Schoolmasters to fight shoulder to shoulder. Where we have failed during the whole of our professional lives, the Minister has succeeded.

Mr. Lindgren

There will be unity in the T.U.C. before long.

Mr. Short

The Minister of Housing and Local Government dealt with the objection of the teachers yesterday and said: I realise that many teachers and others have been speaking from a genuine anxiety to see education continue to go forward, and with a genuine belief that education will go forward faster if each local education committee can feel that someone else will bear three-fifths of the cost of everything it decides to do. I respect their sincerity"— that is to say, the teachers' sincerity— much more than I respect the moral quality of that last argument."—[OFFICIAL REPORT, 9th December, 1957; Vol. 579, c. 912–3.] That is a really shocking thing to say.

The Minister of Housing and Local Government and Minister for Welsh Affairs (Mr. Henry Brooke)

But is it not true?

Mr. Short

No. It is shocking both in what it implies about local education authorities and in what it says about the arguments put forward by the teachers. I tell the Minister now that teachers throughout the country deeply resent the suggestion that they are resorting to some kind of immoral, dishonest argument to defeat the Bill and that they have lacked morals in this dispute with the Minister. The nation ought to be grateful—I think it will be grateful—that the teachers have put up this fight for education standards.

Mr. Brooke

I did not say that the teachers were immoral. I said that the argument was immoral.

Mr. Short

It was the argument used by the teachers. The nation will be extremely grateful to the teachers for putting up this fight for education standards against the most blatant and barefaced attack on education standards in this century.

What a nerve the Minister has to say a thing like that. His own speech yesterday—I read it carefully this morning—was full of ambiguities, half-truths, evasions and synthetic arguments. He really has a bit of a nerve to say a thing like that about the teachers. Let me repeat part of the quotation from the Minister's speech. He said that many teachers believed that education would go forward quicker if every local education committee felt that someone else was bearing three-fifths of the cost of everything it did. Who else will bear the three-fifths of everything that the local authority decides to do? Who is the Minister talking about? The ratepayer is also a taxpayer, only the incidence of taxation is different and a good deal fairer than the incidence of rates.

Does the Minister—he is a longstanding local authority man himself—really assert that, in the opinion of the Government, members of local authorities have a sense of responsibility towards the ratepayer as such, but none towards the taxpayer? I should have thought that the existence of 70,000 overcrowded classes and a deficiency of 50,000 teachers shows that some authorities have perhaps a bit too much sense of responsibility towards the taxpayer. There is certainly no evidence of extravagance there.

The Minister must not imagine that because the Government themselves lack any sense of responsibility to the ratepayer in their concern for the taxpayer, the reverse is true of local councillors, because it is not. The right hon. Gentleman harped on the question of responsibility and an added sense of responsibility all the way through his speech. I could quote many examples of it. To give but one, he said that the financial provisions of the Bill would strengthen the local character of local government through enabling local authorities to exercise greater responsibility over the spending of money in their own areas."—[OFFICIAL REPORT, 9th December, 1957; Vol. 579, c. 906.] He went on to say that the present percentage grant "diminishes responsibility."

Do the Government seriously base Part I of the Bill on the premise that local government lacks a sense of responsibility? That is what they say. I should have thought that the sense of responsibility in local government in this country was greater than anywhere else in the world. Indeed, my own opinion is that perhaps the British race's greatest gifts to the forward march of mankind have been our system of national and local government and our common law. We have made no greater gifts to mankind.

Anyhow, as my hon. Friend the Member for Cardiff, West pointed out, the local authorities have to find 40 per cent. from their rates. They have to go before the electors every three years. I am a former local authority man myself and I deny absolutely that there is anything but the highest sense of responsibility among local councillors towards both the ratepayers as such and the taxpayers as such. But not one word in the Bill gives more responsibility to local authorities.

Some Government supporters have gone even further than the Minister. One supporter outside said that the block grant was a grant without strings. What utter humbug this is. Let me read what the Lord President of the Council said about this on 24th April: But on one thing I will not compromise. Administration is for the local authority. Minimum standards are a question for me, and I will never surrender the duties of promoting education and of controlling and directing educational policy put upon me by Parliament. It must be my duty while making every allowance for variety of pattern to minimise so far as I can differences in standards of performance, differences that is in the quality of educational opportunity between locality and locality. What greater freedom is there to be for local authorities? The Minister himself, in discussing Clause 3 (3) said: The Bill provides, in Clause 3 (3), for standards and other requirements to be prescribed by the Minister concerned, and this is in addition to powers which Ministers already have to lay down certain standards. This is not more freedom; it is less freedom. It is giving Ministers additional power. No liberty, no extra freedom, no extra responsibility is given to local authorities in the Bill which could not be given under the percentage grant system.

When that argument is demolished, we are told that a second reason is that the block grant will import more uncertainty into the Exchequer's calculations. The Minister said: The general grant will help the Chancellor to budget properly, to see where he is going…."—[OFFICIAL REPORT, 9th December, 1957; Vol. 579, c. 911–3.] That would be quite an achievement. Are the Government seriously asserting that uncertainty about annual education estimates—and 87 per cent. of the grant is for education—has become a serious embarrassment to the Chancellor of the Exchequer? I look for an answer from the Minister who replies to the debate.

That is the first we have ever heard of this argument. The percentage grant has been operating ever since Mr. Fisher's day, but this is the first time that we have ever heard this argument. The Government have for the first time discovered that they are seriously embarrassed by the uncertainty of the annual education estimates. Surely, there is no more uncertainty about them than about the Estimates of the Army, the Navy or any other Government Department.

Mr. Lindgren

Far less.

Mr. Short

Far less, I should have thought. What it will do is to replace certainty by uncertainty for local authorities. How can local authorities plan ahead if they do not know how much of a project will be covered by the grant?

The Times has rallied in support of the Government on this issue, as it always does. Lloyd George, translated into modern terms, once said that it was the 4d. edition of the Daily Mail. Not recently, but when the White Paper was issued, The Times said that there was a complaint … that the new system will introduce a large measure of uncertainty into local government finance, for the amount of the grant will be settled 'year by year by a process of haggling between the Chancellor and the local authority associations.' The White Paper itself pointed to the need to improve financial relations between central government and local government. It also talked about the need to reduce the dependence of local authorities on Exchequer grants. That one rather lets the cat out of the bag.

What is wrong with the present relationship? Is there anything reprehensible in the Exchequer contributing 60 per cent. to a national service which is administered locally? I should have thought that the 60–40 ratio just about reflected the distribution of power in the educational system. Even if the Government felt that the balance of charge was wrong, they could have adjusted it within the percentage grant system. The truth is that the issue about responsibility and the issue about improving the relationship between local and national government are purely synthetic arguments. Any person making an objective examination of the Bill and the prospects would be forced to that conclusion.

The Government must be aware that progressive authorities wanting to do a little extra will have to meet practically the whole of the cost—as my right hon. Friend for South Shields (Mr. Ede) pointed out, not quite the whole, but practically the whole of the cost—from their local rates. The Minister of Education today talked about the shortage of teachers in Birmingham, and he revealed the whole thing when he said that Birmingham would make a profit if it still had a deficit of 500 teachers. There are two implications of that statement. The first is that a backward authority wanting to economise will not appoint the right number of teachers and will so save money.

Mr. Lindgren

And have larger classes.

Mr. Short

Yes, of course. That is the first implication.

The other implication is that a local authority wanting to go above the national mean and do really well will have to bear the whole extra burden upon the rates.

I come to a matter which has not, I think, been referred to in the debate yet. In Clause 2 (1, a) it is laid down that new development cannot be counted in fixing the grant, except with the consent of the Treasury. So the Treasury is to decide the rate of educational advance. I would point out to the Minister, and the teachers here will agree with me, that almost everything in the school curriculum was started as a little extra, a novel little thing done by a progressive teacher or a progressive local authority. Things like that are to be barred in future except with Treasury consent. We know what that means. One effect of this sort of regulation will be a sterile, moribund system.

One of the main objectives of the 1944 Act was uniformity throughout the country. One of the great scandals of the education system was the obstruction to educational opportunity. I do not think anybody in the House would deny that in the last twelve years there has been a bigger advance towards equality of educational opportunity than in any other twelve years in our history. Does the Minister deny that the block grant will halt that and, after a few years, will reverse that?

Sir E. Boyle

I doubt whether the percentage grant has led to the degree of uniformity that the hon. Member is asserting. I quite agree that in some things, for example, the ratio of grammar school places, a much greater degree of uniformity of standards has been attained, but there are many respects in which it has led to exactly the opposite.

Mr. Short

I do not want to pursue that now, because there are many other hon. Members who want to take part in the debate, but I would ask the hon. Gentleman to read, if he has not done so, Mr. Fisher's speech, in 1918, on the introduction of the percentage grant.

The better authorities will probably be faced—this is their calculation—with an extra educational rate of 7s. in the £ because of the block grant within five years. That is not my figure. It is theirs, and they are experts. The Minister knows full well the limitation of rates as a source of income.

I do not think this has been expressed sufficiently in the debate either. Let us face the fact that for most people living today in normal-sized houses the rates are simply a poll tax. In so far as they vary at all they vary on a criterion which is very often irrelevant to income. Therefore, because of this limitation on the amount which can be got from the rates educational advance must inevitably be slowed down. I see no alternative.

The Minister said yesterday: There is no intention whatever of using this change of system as a surreptitious means to cut down the standard of provision of education or any other service."—[OFFICIAL REPORT, 9th December, 1957; Vol. 579, c. 911.] I am very much afraid that no one who has made an objective examination of the Bill and its probable effects can accept his assurance. I am sorry to say that, but that is the conclusion I am forced to. Bearing in mind that the only source of income available to local authorities to raised money is the rates, I can see no alternative to halting progress. That is really quite inevitable.

Mr. H. Brooke

The hon. Member has given no reason at all for that. That is just another of the quite unfounded allegations of which we have heard far too many in the last few months.

Mr. Lindgren

We are unable to believe the right hon. Gentleman on any occasion.

Mr. Short

In the last ten minutes I have been tracing out an argument. I do not know whether the right hon. Gentleman is incapable of following an argument. If he is I cannot help it. I would ask him to read my speech when it has been printed I have spoken of the difficulties, and of the difficulty of the limitation of rates, and I drew a conclusion from those premises. I ask the right hon. Gentleman to read my speech tomorrow.

Is not this why the police have been excluded? Is not this another synthetic argument, about not being able to work out a formula for calculating police grant? Is not the real reason that there are different standards in the police forces throughout the country?

The Minister also said this: I fancy that those who argue that education should be excluded from the scope of the greater financial responsibility given to local authorities by the Bill are really saying that local authorities should not be responsible for the education service and that it should be run from London. That is a view which we on this side of the House cannot share."—[OFFICIAL REPORT, 9th December, 1957; Vol. 579, c. 913.] What utter nonsense. What a rotten case the Government must have to resort to such a demonstrably false argument.

The Labour Party in this House and throughout the country is steeped in the local government tradition. We believe as much in municipal Socialism as we believe in Socialism generally. Scores and scores of hon. Members on this side of the House have served, and a great many are still serving, on local government bodies. The teachers would be the last people of all in the country to advocate the complete centralisation of the education system into the hands of a Government Department—and for very obvious reasons.

There is nothing new about block grant proposals. As my hon. Friend the Member for Cardiff, West pointed out, in 1901 the minority of the Committee on Local Taxation stated that it was to bring home responsibility to local authorities and to ensure economy. It went on to say that the block grant obliges those who administer services to raise at their own cost every pound in excess of a fixed sum and thus gives them a direct interest in economical administration. Geddes in 1921, May in 1931, Ray in 1932, all economy committees, all advocated block grant for economic reasons. Can anybody in his senses doubt that economy is the objective?

Mr. Lindgren

They know they are not telling the truth.

Mr. Short

I draw attention to the speech of the hon. and gallant Member for Nottingham, Central (Lieut.-Colonel Cordeaux). That lets the cat out of the bag.

Part I of the Bill has no necessary connection at all with the rest of the Bill. Even at this late hour I appeal to the Minister, although I am only a back bencher, to think over it and see whether he cannot reconsider the whole thing. Do the Government realise the relevance of education to the economic dilemma of the country? It is absolutely 100 per cent. relevant to our economic problem. There is no other way. Trained, efficient people can alone compensate us for our lack of resources and our lack of manpower. We have seen in Russia recently that a totalitarian State can focus all its resources on any given objective. We know that democracy cannot do that. As I see it, what is at stake is not merely the country's education standards. What is at stake in the long run is our democratic way of life.

8.8 p.m.

Captain F. V. Corfield (Gloucestershire, South)

Yesterday my right hon. Friend the Minister of Housing and Local Government said that the financial provisions of the Bill were based on the assumption that local authorities could continue to draw the bulk of their revenue, apart from such items as rents and the like, from rates on the one hand and Exchequer grant on the other. Later, in talking about the new general grant, he said that this principle would put the Exchequer contributions on the same footing as rate revenue for use by local councillors in the best interests of the areas for which they were responsible.

I welcome that principle because, unlike the hon. Member for Newcastle-upon-Tyne, Central (Mr. Short), I believe it will increase the sense of responsibility of locally-elected councillors to those who elect them, and the health of local government depends also on the interest of the electors in those they elect and in what goes on in the council chamber. I would say we have still a long way to go if we are to attain that ideal.

I should have thought that most Members of Parliament were constantly aware of cases being brought to their notice which were properly cases for their local authorities only to find that the constituent concerned did not know even the name of his local councillor. It seems to me that these measures should stimulate the interest of the electors in the elected as well as the sense of responsibility of the elected for the electors.

Most of us would agree that if in the House there was no direct connection between expenditure and the raising of the necessary revenue, we should not have preserved the democratic form of government over the many centuries during which it has been preserved. Although, of course, one cannot have the same connection in local government, as reliance on Exchequer grant shows, I should have thought it absolutely necessary that we should reduce the sphere in which there is no direct connection to the smallest possible extent.

I find it difficult to reconcile a genuine belief in local democracy with the opposition to this general principle. I very much agree with the remarks made by my hon. Friend the Member for Westbury (Sir R. Grimston) yesterday. I feel that the health of local government has an enormous part to play in the battle of ideas which rends the world at the moment and in which we are so very determined to secure the preservation of our way of life. But I am very disappointed that my right hon. Friend the Minister of Housing and Local Government has not been able to find either a substitute for or a complement to rates as a source of local revenue.

In his reference to rates, my right hon. Friend said that the Government could not find any other source of revenue that would satisfy the test of being easily collected, readily assessable and proportionate to need. I very much question whether that is a proper, suitable or adequate test for a system of taxation. My right hon. Friend went on to refer to the necessity that occurs from time to time to adjust the proportion of rate burden borne by various types of property. As the hon. Member for Newcastle-upon-Tyne, Central has said, we have had a series of reductions, of 100 per cent. in favour of agriculture, 20 per cent. in favour of shops, 50 per cent. in favour of industry and absolute chaos under Section 8 of the Rating and Valuation (Miscellaneous Provisions) Act, 1955. That is an appalling reflection on the efficacy of the rating system as a proper means of taxation.

I welcome what my right hon. Friend has forecast about the investigation into the workings of Section 8. If that Section is to produce any sort of sense, the Government must pay a great deal of attention to defining much more clearly the type of hereditament which it is intended to cover. I ask my right hon. Friend to bear in mind that, however successful the Government might be in carrying out that intention, they have left the door open for an enormous number of anomalies by reason of the discretionary power given to individual rating authorities under Section 8 (4) of that Act. We shall never get any real uniformity in the rating of charities unless something much more explicit is laid down and that discretionary power is withdrawn.

My main objection to rates is that they are in no sense levied with any relation to the ability to pay. In addition, they constitute a tax on initiative and improvement. We have been passing housing Acts for the last fifty years to encourage people, particularly in the rural areas, to improve their property and to live on a higher plane of housing. Then we have had a system by which when a householder installs a bathroom or makes some other improvement we immediately charge him more for it. That seems to me ridiculous.

I suggest that even if rates must remain as the basis of local Government revenue, there is a great deal to be said for tying them to the site value rather than to the premises on the site. We should then have precisely the opposite effect and we should encourage people to make the best possible use of sites. In addition, we should have a very great advantage in that rates would be related directly to any benefit of development value in the neighbourhood. Therefore, it would operate as a tax on improvements carried out at the public expense. This is a problem not yet satisfactorily solved. A rating system based on site value might well produce a very much better answer to it than we have had in the past.

Moreover, the very acceptance by the Government of the idea of the general grant shows that there is no sacred relationship between the proportion of revenue to be raised by the rates and the proportion of revenue to be raised by other forms of taxation administered through central government. I cannot see, therefore, that it is a sound argument to reply that if we changed the rating system to a system based on site value, rather than the occupation of premises it would reduce the amount raised by the rates. It almost certainly would, but there is nothing sacred in the proportion of revenue from rates to that from Exchequer grant, and during the past century the proportion has altered steadily in favour of the Exchequer grant.

As to the general grant as a whole, I entirely approve of this innovation. I think it is true that the bulk of the opposition to this proposal has come from those people who are primarily interested in education. As the hon. Member for Newcastle-upon-Tyne, Central has said, that is probably very natural. Nevertheless, it seems to me that teachers in particular, and indeed most of us, would deplore any suggestion that education should be run as a nationalised service from the centre. But, if we cannot have really responsible local government, that, it seems to me, would be the logical result of the opposition to this proposal.

I should have thought that no service in the country depends to a greater extent on really efficient and responsible local government than does education. I view the opposition to this proposal with some concern, because if our educational system is not producing a responsible citizen aware of his responsibilities in his local politics and in his selection of his local representatives it is failing in the major part of its purpose.

We have seen all too clearly how the Russian totalitarian system of education can so well provide technical and scientific skill, but that is not enough. Our educational system should not fail in that respect. Surely, this proposed general grant is a challenge to the educational profession to ensure that we produce that live interest in local government.

Finally, I make one plea on behalf of the small ancient boroughs. If the smallest of them are to derive nearly all their power as delegation from a rural district or an urban district, many of them will be in the position of being, in effect, parish councils. I know one ancient borough which has a population of under 3,000. Therefore, it would be in effect nothing more or less than a parish council. If the panoply of the mayoral chain, and so on, is retained for a council of that size and power, we should make it slightly absurd instead of adding to its dignity.

History shows that nearly all these ancient boroughs have served a very wide rural area. Admittedly, their powers may not have extended beyond their boundaries, but socially, culturally and commercially they have been the centre of a wide rural area. Surely, therefore, the answer is to make that the basis of the new unit and let the man who would normally be chairman of the district council be the mayor, with the panoply and dignity which go with that office. That would preserve something which is well worth having, without having cast upon it the aspersion of something slightly ridiculous, a very small local authority with very little power going about with all the panoply normally associated with, say, Birmingham or the City of London.

In conclusion, I hope that my right hon. Friend and his right hon. Friends will look once more at the question of rates. It seems to me to be a thoroughly bad method of taxation as it stands, and although I agree with my right hon. Friend that it has been tried, I cannot agree that it is satisfactory. I welcome the general principle of the block grant. I believe it should be regarded as a challenge to educationists rather than as the subject of opposition to the Government, and I hope that the ancient boroughs will preserve something which has real meaning and not something which is slightly absurd.

8.21 p.m.

Mr. G. A. Pargiter (Southall)

I hope the hon. and gallant Member for Gloucestershire, South (Captain Corfield) will forgive me if I do not follow him into the ramifications of the evils of the present rating system, which are not really relevant to this Bill. I want to return to certain aspects of it because, fortunately or unfortunately, I happen to be one of the few people in this House who has taken part in the negotiations between various associations which have led in some measure to certain parts of the Bill. Whether it was a privilege, or what it was, I am not yet certain. When I look at the Bill, I become even less certain about the results of our labours and what is likely to be achieved.

It should be borne in mind that Parts II and III are essentially compromises between differing points of view. This should be recognised at the outset, because I have no doubt that there will be many interests devilling for their particular interest during the Committee stage. I hope the Minister will stand firm because, as soon as he begins to lean too far one way against those parts of the Bill which are an agreed compromise, there will be an equal pull the other way.

For instance, there are the population figures. There is little room for latitude on the question of the 60,000. If someone wants to substitute 80,000 for 60,000 there will be a row with the A.M.C. Equally, if someone wants to substitute 40,000 for 60,000 there will be similar difficulties the other way with the County Councils Association. Therefore, I commend the particular figure, not because of its import, but because it happens to be the best compromise which could be reached between all the parties concerned.

I cannot help feeling a little disappointed when I look at the Bill and when I remember what the former Minister said about his intentions for local government reorganisation. I am not now referring to Part I of the Bill. I am slightly disappointed after what was said, and how certain the Minister was that, unless there was agreement between the authorities on the question of delegation of functions and so on, the Government would have to impose their own solutions.

Their method has been to include those things upon which there has been some, if not complete agreement. Many other functions which we understood were to be included in the Bill, and which would have done the job once and for all, are now to be left to some future time. So quarrelling and wrangling will go on between various types of authorities about those other functions, and we have been promised that these will be introduced in a Bill in the "sweet bye and bye". It remains to be seen whether this Government will introduce a further Bill on local government. My view is that this will not be done in the life of this Parliament and they will probably have no opportunity in the life of the next one.

So the Bill still leaves problems to be solved, and I am wondering just how urgent Parts II and III would have been regarded by the Government had it not been for the cardinal factor for which they wanted this Bill, that is Part I. There is no doubt that it was Treasury pressure as regards Part I which caused the introduction of a truncated Bill at this stage instead of one dealing with the whole problem. It is obviously because the Government have to get it on the Statute Book if something is to be done about block grants the year after next. I admit the genuineness of the Minister, who wanted to do something about local government, but the essential feature of the Bill is the financial part. It is because of this and because I think that many other things could have been better dealt with had there been a little more care and thought, that I will refer to certain questions of principle.

Take the question of supplementary grants. These are to be paid where there is a decline of population, in other words a decline of rate income. What about the authority which gains in population? In that case it is usually many years before the authority concerned recovers the costs which the additional population involve. They have to wait a long time, but they will not get any supplementary grant for increased population. This is a matter to which we might ask the Minister to direct his attention and make some Amendment to the Bill during the Committee stage.

I would also like to know more about the general question of the sparsity and density figures. Some hit-and-miss figure has been introduced in this respect. I speak feelingly coming from Middlesex, which, as far as we can estimate, will receive no benefit. This provision will certainly benefit London considerably, which is better off than Middlesex in this respect. There are parts of Middlesex which are as densely populated as London but, because we are a dormitory of London, we have far less rateable resources than London with its large mass of office and other accommodation of that type. I give the Minister advance notice that I shall ask him to look at this figure again.

Then there is the question of normal expenditure. From my point of view, this is academic for Middlesex. We do not get the deficiency grant anyway, but there is an important point in this connection. The rate-deficiency grant is to be payable only for what is regarded as normal expenditure. Will the Minister give some indication of what will be regarded as normal expenditure? Let us assume that for a long time a local authority with a large school building programme or with housing problems has been unable to proceed very far because of the Government's policy of restriction of capital expenditure. Supposing that authority suddenly decides to proceed with that work. Would that be regarded as normal expenditure in this context? As we see it, it would not and such an authority would face increasing discrimination.

Several hon. Members have asked why the police, remand homes, approved schools and magistrates' courts cannot be included under this all-embracing grant. We have been told that the only reasons are technical difficulties, but we were told in our discussions with the departmental representatives that there were no technical difficulties. Perhaps the Minister will explain that situation. We look with some degree of suspicion on the fact that we have a paring of education, but not of police and similar expenditure.

There is no valid reason, if the block grant principle is sacred, why local authorities should not exercise their financial responsibilities over the whole range, not merely over those things which the Government perhaps believe may be subject to deduction without touching those things upon which the Government will take care to see that expenditure is maintained.

I want to refer to percentage grants. Hon. Members will recollect the circumstances in which percentage grants were introduced. They were introduced at a time when there was considerable expansion in responsibilities placed on local authorities by the central Government because of the expansion of social services, which were demanded by the people after the war and which were recognised by the Government of the day as being right and proper.

The then Government recognised that the decision meant that local authorities would have to undertake the work whether they liked it or not and said that because they recognised certain services as being a responsibility equally shared by the central and local authority those services would be subject to a 50 per cent. grant. I have some experience of this matter, and I have yet to learn exactly what lack of freedom there was in the actual administration of those services. That brings me to the subject of administration.

What local authorities have had to do has been to submit administrative schemes and so on for approval by the Minister. I am not aware that the expenditure incurred by authorities in the administration of the schemes was subjected to this so-called meticulous examination which we are now told is an essential feature of the percentage grant system. It has just not worked that way. I wonder how far we shall be released from the irksome restrictions to which hon. Members opposite have referred.

The most irksome fellow in local government is probably the district auditor. It is he who has a close look at the expenditure to see whether it is in accordance with Statute and whether it is proper and reasonable expenditure. One must assume that this brand new freedom which we are to get will mean the abolition of the system of the district auditor—or will it? We shall be interested to see what happens.

I want now to deal with freedom of policy. What freedom will be given in our control of policy? When taking office, the former Minister of Education, who has now taken up the occupation of bell-ringer, said that irrespective of where the money was found or what system of grants was operated he would insist on maintaining the standards of education. That is all right, but what freedom will local authorities have to go below or above those standards? There will certainly be central control in that respect.

Another service which is subject to only a 25 cent. grant but which should have a larger grant is the fire service. It has been left to local authorities to run the fire service until there is a state of emergency, when the Government will take control again. Can we imagine that the standards upon which the Home Office has insisted, irrespective of the grants, will be allowed to deteriorate and that councils will be allowed to do what they like with their fire services and will be permitted to allow those services to run down when we want them maintained in a high state of efficiency in case of national emergency? What sort of freedom will we get there?

Above all, what sort of freedom will we receive regarding capital expenditure? Here, of course, is the essential rub, because neither this Government nor any other Government will give up control of local authority capital expenditure. Let us face it. The whole question of one's freedom to do what one wants to do comes back in the last analysis to capital expenditure. If we have not freedom to spend the capital we can safely say that any other freedoms we receive are completely illusory. I would be very glad to hear from the Minister what he proposes to do. That will go on in the very same old way that we complain about. We shall send our plans for schools and so on and the Minister will say, "I do not think I will approve this. It looks as though the cost is a few pounds more than it ought to be." This will be capital expenditure upon which the screw can always be put.

Sir E. Boyle

The hon. Member would agree that it is largely through this control of capital expenditure that we have been able to obtain greater uniformity of grammar school places about which the hon. Member for Newcastle-upon-Tyne, Central (Mr. Short) spoke. The manipulation of school building programmes has helped a great deal.

Mr. Pargiter

The hon. Gentleman is arguing the case for freedom on that basis, but I am arguing it on the basis that we shall be as closely controlled in the future as in the past with the disadvantage that the Government will pay less towards it. There can be no question about that. The statement in the White Paper was explicit, that Government expenditure in the proportion of six against five from rate borne expenditure was unhealthy and they intended to rectify it. By that they must mean to increase the proportion of rate borne expenditure in relation to expenditure from central Exchequer funds. If they wish to do that, let us be clear as to how they intend to do it. I hope the Minister will go a little further in reply regarding the grant for education. It has been touched upon, but I am not sure whether the position is clear.

The grant, so far as staffing is concerned, will be based on the average of the country. In the average of the country there must essentially be some below and some above regarding staffing. I know a little about a number of education authorities, but I do not know of any authority that is overstaffed. There may be a few public schools which have good staffing arrangements, but in the case of the service administered by local authorities I do not know of one authority which is overstaffed.

The authority which has the proper staff will be penalised on the basis of the average. If there is a top and bottom there must be something in between, and if we are to take away from the top in order to keep the average we must take away from the proper staffing arrangements now existing. I am sure that education authorities will be interested to know that if they have proper staffing arrangements in accordance with standards agreed by the Ministry they will be penalised. If they do not come up to those standards whether through desire or inability to obtain teaching staff, they will gain. The question requires an answer.

I want now to come to another aspect of education which has not been touched upon. The Minister has said that local authorities will have greater freedom, but it is proposed under the aegis of this Bill that as far as higher technological education, certain technical education and certain other further education subjects are concerned there shall be a pooling of expenditure over the whole country. Who will control that? Will the local authority control it? If so, how? If we are to have a pooling of expenditure—and this is implicit in the proposals—we shall have not a pooling of grants or anything of that kind. It will be a pooling of expenditure. That expenditure will presumably fall, equally or unequally, upon all local authorities, quite out of proportion to the amount of service which they are to provide out of the pooling arrangement.

I should like to know how the Minister squares up a national or even a regional pooling of some parts of the education service with greater freedom for individual local authorities to control their own services. Perhaps we could have an answer, because we shall certainly want to know more about it at a later stage.

Sir E. Boyle

I can give an answer now. I am sure that the pooling of expenditure in this part of the education service would have been necessary sooner or later as part of the Government's policy for bringing the White Paper on Technical Education into effect. I do not believe that the intra-authority payment scheme could be said to represent a permanent solution.

Mr. Pargiter

I am not complaining about the pooling as such but about the Government's statement of their intention to give local authorities greater freedom. The Government are taking money from local authorities in order to give them greater freedom, and are then also withdrawing certain services. Out of the remaining money local authorities must provide for services, but the money will be pooled and the Department will very largely direct affairs, with local authorities having very little say indeed. It does not make sense.

Reference has been made to the views of local authority associations. I know what they are. They said that they appreciated the prospect of additional freedom, if the Government really meant it, but they are very sadly and rapidly coming to the conclusion that the Government do not mean it. They said that they required assurances before the Second Reading debate, but those assurances have not been fothcoming. Most local authority associations are very anxious to work in conjunction with the Government of the day. They will do their level best to conform and to carry out the policy devised by the Government, but having been consulted and having pointed out that if certain changes are to be effected, they will accept those changes in principle, with certain safeguards, they are being treated rather cavalierly at present, especially when the Minister says that they are generally in favour of the block grant system.

If we examine some of the safeguards, we will see that not one of the associations will give unqualified approval to a block grant system on the basis already propounded, and in their capacities as education authorities they are at sixes and sevens. They are pulled in one direction by those who want the block grant system, with the necessary safeguards, and in another because of their position as education authorities.

I still have bitter recollections of the block grant system. I am a member of an authority which, under the terms of the old block grant system, had to make a rate contribution to the Exchequer in order to get its benefit back. The authority was threatened that if it did not agree to pay back something to the Treasury the grant formula would be altered in order to make sure that the Treasury got something. I am not very much in love with the block grant system.

There may be a honeymoon period—a short period when the Treasury will cushion the effect of losses to local authorities—but in my view the protestation that local authorities are not necessarily going to lose does not square up with the provision made for the losing period. It is recognised that there will be a period of loss, and the Government realise that there will be a great scream if the loss comes all at once. But when that honeymoon period is over it will be possible to know what the ratepayers will have to pay in addition out of the total as between the Exchequer and the rate-borne contribution.

In Middlesex, the ratepayers will have to find no less than £4,200,000 a year more. That represents the extent of the Treasury equality of contribution so far as that county is concerned. It is not a question of a rate deficiency grant or anything like that, because that is a luxury unknown in Middlesex. This is the actual difference—£4,200,000 a year—on the basis of last year's expenditure, and, of course, an increase in the expenditure is inevitable. It is made inevitable because of the need to provide services which have long been delayed. There is, therefore, bound to be an increased expenditure; so that the figure of £4,200,000 is a minimum figure and in all probability the ultimate figure will be very much more. It is not to be wondered at that even the Middlesex County Council, which is Tory-controlled and has leaned over backwards to support the Government, is feeling a little alarmed about the prospect of giving this Measure its undivided and loyal support.

My interest in Parts II and III of the Bill is somewhat academic because of the decision to appoint a Royal Commission to report on the Greater London Area. I consider that a wise decision. One can only express the hope that the Minister will indicate to the Commission that there is a degree of urgency about the matter, so that Greater London will not be left completely alone when a system involving the rest of the country is being gradually worked out. The effect on changes in the Greater London Area will be felt in the neighbouring counties of Essex, Kent, Surrey, and Middlesex. No proper review of these counties can take place until the Royal Commission has reported and the Government have dealt with the Report. So it is important to impress upon the Royal Commission the urgency of reporting as quickly as possible in the interests of all those counties, and something should be done to expedite its work. We remember the length of time the last Royal Commission took to report on London, and no doubt the problem is greater now than it was then.

Criticisms have been made about the county councils undertaking the review of county districts. The County Councils Association accept the criticism that many counties did not carry out a proper review on the last occasion, and it is content that the Minister should possess the necessary powers to deal with county councils who do not do the job properly. It is not a bad idea that people who have an intimate knowledge of a particular area should be considered the right people to do something about this matter, provided that they give proper effect to the decisions implicit in the Bill.

If the Minister would drop Part I of the Bill and consider the problem of the financial relationship between the Exchequer and the local authorities on the basis of a proper system being devised, there might be some possibility of arriving at an agreed Measure. Local authorities do not spend money for the sake of spending it, and they have as great a responsibility as the central Government for the provision of such social services as they are called upon to administer. A system should be devised to obtain a proper balance between local government and central Government expenditure and not devised on the basis of saving the taxpayers' money at the expense of the ratepayer. One may express the hope that such a system will be devised, but I am afraid that it is not very well founded. Under those conditions, I shall be glad to go into the Lobby to vote against Part I of this Bill.

8.50 p.m.

Mr. G. R. Mitchison (Kettering)

We have had a debate on the White Papers previously; today, we have had what I can only call a most enlightening debate, in which the whole weight of experience, eloquence and sincere, even emotional, feeling has been on this side and not on the Government side. I have rarely heard a debate in which there was a more obvious difference.

We were told by the Minister of Housing and Local Government at the beginning of his speech the other day that the one thing to which almost everybody has assented since the war has been the need for Parliament to tackle a comprehensive Measure of reorganisation of local government. At that point, the right hon. Gentleman picked up the Bill rather gingerly, because he has found that Bills bite him sometimes, and held it in his hand. He wobbled it gently to and fro. It was obvious that he was trying to do a little bell-ringing, but the bell had not any clapper and nothing whatever happened. The House was singularly unimpressed.

I regard the Bill as having one main purpose. I will say a word or two about areas and functions, in Parts II and III. The outstanding thing about areas is that the Local Government Commissions are expected by the Minister to have laid down for them what he called, at one point, basic provisions which are of fundamental importance", and at another basic principles, where basic principles are essential."—[OFFICIAL REPORT, 9th December, 1957; Vol. 579, c. 906 and 907.] The only guidance the Commissions find in the Bill for what they are to do is in the few words …in the interests of effective and convenient local government. Those words appear in the White Paper. They were lifted from the Regulations for the Boundary Commission in 1945, where there were many other directions than that. The effect of this part of the Bill is to leave the whole business to the Commissions with practically no guidance at all.

This provision was referred to by the hon. Member for the City of Chester (Mr. Temple) as a flexible idea in my right hon. Friend's mind, when he appointed the Commissions. It is reported slightly differently in HANSARD, and without any reference to the right hon. Gentleman's mind. I took the words at the time, and they are what was said.

It is a remarkably flexible idea; no idea at all, or something so flexible that it has no shape whatever. What is interesting is that the Commissions are to make their proposals, which include the conurbations, or special review areas, if hon. Members prefer that language. Though at the Commission level there will be investigation, consultation, representations and the rest of it, at Ministerial level there will be representations, and a local inquiry unless the Minister is satisfied that he has already been sufficiently informed. That is the case at the lower levels.

At the Parliamentary level there is only an affirmative Resolution to deal with proposals about conurbations and such other matters. Less important than the conurbations is the disappearance of Rutland. I agree with the comment of the hon. and gallant Member for Rutland and Stamford (Sir R. Conant) that on an affirmative Resolution of that kind it was quite possible that no one but he would be interested.

I regard this as a most unsatisfactory method particularly as regards conurbations. The Commissions have no guide as to what line they are to take in a matter which is new from this point of view, which is of vital importance to a large part of the population of this country, and upon which they, having done their work, pass the matter on to the Minister. After that, all that comes before the House is an affirmative Resolution, incapable, as always, of amendment of any sort.

I do not call that Parliamentary control of any effective kind whatever in a matter of this sort. I simply say that that is because the Minister has no idea, as indeed appeared from the White Paper, what sort of directions, what sort of objective, what sort of guidance he ought to give to these local authority Commissions, and he therefore shifts the whole thing on to them and says, I suppose, that this is a new brand of Tory freedom.

It is not as though the Government always paid attention to the Reports which they get from Commissions. We have seen the Gowers Report. Parts of it went down the drain. We have seen the Wolfenden Report, which is likely to go down the drain. Even the Royal Commission on Divorce has gone down the drain to a large extent, too. What will happen to these local government commissions? No one knows how long they will operate, they have no guidance whatever and, at the end, there is no effective Parliamentary control.

These directions are specifically directed to conurbations. I quite agree that for some of the smaller tasks there may well be a case for doing that, and indeed it was done with some considerable success, but not in relation to the conurbation problem, by the 1945 Boundary Commission. Indeed, when we come to smaller matters, I agree with what has been said by one of my right hon. Friends and by my hon. Friend the Member for Wellingborough (Mr. Lindgren) from this Box, that the county councils are not the right bodies to do county reviews. There can be very little doubt about that.

The history of this matter is that the county councils were given powers under the 1933 Local Government Act and when the Boundary Commission was set up by the Coalition Government, that is to say by a Government which included the predecessors of right hon. and hon. Gentlemen opposite, they transferred to the Boundary Commission those powers of review, and they were restored to the county councils when the Boundary Commission was dissolved. Why have the Government changed their minds about it? Particularly, why have they done so when their own account of the history of the matter in Cmd. 9831, paragraphs 49 and 50, is that The extent of this problem varies from county to county. It refers to the differing manner in which the county councils carried out their reviews in the years before the war and it points out that although in some counties quite a lot was done, in others there was …strong opposition from interests concerned to maintain the status quo, and the proposals put forward were inadequate. They were the pre-war reviews.

During the period I have mentioned of the Boundary Commission there were, of course, no county reviews and very little indeed, if anything, has been done since the powers of review were restored to the county councils. Why in those circumstances are the county councils to be left to conduct these reviews? To put the matter briefly, they are far too close to the questions which they will have to investigate, and there are plenty of opportunities not only for strong opposition from interests concerned to maintain the status quo", but also for conflicts between the interests of the county councils themselves and those county districts with which they will have to deal. I would therefore much sooner have seen those matters dealt with by the Boundary Commission. I repeat that I take no particular objection to the Boundary Commission dealing with the smaller matters. It is the entire absence of authority or direction and the lack of Parliamentary control in this vitally important matter of the conurbations to which I object.

There is a further argument about this county review business. Under Clause 28 (2) it is quite clear that the county review cannot proceed until the Local Government Commission has dealt with or renounced dealing with the area in question. No one knows—no one can tell us unless, when he replies, the Parliamentary Secretary can—how long the Local Government Commission will take and how it is to function. Therefore, the whole question of county reviews is postponed to a quite indefinite period because of this defect in the machinery. Moreover, if one of the objects of the Bill really was to get rid of some small authorities—there has been a great deal of support for getting rid of small and rather unworkable authorities—why put them right at the end of the queue, as is done by postponing the matter to the Local Government Commission operation?

About functions I have even less to say. Functions, originally, were quite a formidable list. Now there is delegation of some health and welfare functions and a question about the excepted districts which relates to 55 out of the much larger number of local authorities because they have a population of 60,000 or more or to "special circumstances". In due course we shall have to see what the right hon. Gentleman considers to be "special circumstances", but a great deal of matter that was difficult and objectionable to many local authorities, including the whole question of divisional executives has been dropped or deployed. It is always nice to know that this is another instance of the flexible idea in the mind of the right hon. Gentleman. It is so flexible that it has now been compressed to about half of what it was when he first mooted it.

So much for the less contentious part of the Bill. I now come to the financial provisions. It seems quite incredible that any person endowed with the most elementary common sense can have any doubt whatever but that the object of the block grant is to define and limit the Treasury contribution to certain local authority services of which seven-eighths is for the education service. I find all the rest of this wholly unreal and absolutely unsupported by any evidence or practice, or, indeed, any sense. It is perfectly obvious what has happened. We actually had the Minister of Education telling us that we could not have a block grant—I think that was his phrase—without including the educational expenditure in it. I wonder if he really meant that. Has he forgotten the history of the matter?

There was a block grant introduced in 1929 and it did not include education. Let me remind the right hon. Gentleman why it did not include education. It did not include education because the Board of Education took a very strong line indeed against being included. A Committee was set up under Lord Meston to consider the balance of advantage between percentage grants and block grants. The Committee sat for some time, and it is perfectly clear, from a number of leaks afterwards—I am being topical about this, of course—that the Committee reported strongly in favour of percentage grants and the Government of the day, being a Tory Government, did not publish the Report. The Ministry of Education came out on its own and published the evidence which it had submitted to the Meston Committee. I have it here. The right hon. Gentleman ought to look up some of the archives in his own Ministry before he makes statements such as the one he made today. Here, in Command 2571, the Board of Education Memorandum with regard to the existing grant system, is the evidence which was submitted.

What made the Ministry change its mind? Has it, indeed, changed its mind? The objections in this Memorandum are just as applicable today as they were then. The objections on educational grounds which induced the Board in those days strongly to oppose the applicant of a block grant, general grant—call it what one will—to education were objections of principle and objections related to the character of the service. Those objections applied then and they prevailed on Lord Meston's Committee and prevented the Tory Government of the day, though the Chancellor of the Exchequer would have liked to do it, from applying the block grant to education. Those objections are just as sound now as they were then.

I say quite frankly that I do not believe that the Ministry of Education has changed its mind in the least in this matter. I had the impression when the Minister was speaking that, for every educational reason, he would infinitely have preferred a percentage grant, but he had fought and lost a battle with the real author of the Bill, who is neither of the two right hon. Gentlemen on the Front Bench tonight but is the Chancellor of the Exchequer—or, if they prefer it, the Cabinet as a whole. There is not the faintest doubt that that is what happened.

I come now to some of the arguments which have been advanced. There have been suggestions of extravagance, suggestions that local authorities have been spending unwisely and might spend more wisely if they had only a fixed amount. That occurred in the White Paper as a criticism of percentage grants, which were called an indiscriminating incentive to further expenditure. Commission after Commission has considered this matter and held the directly opposite view. The suggestion is wholly untrue It was supported by no single case, and I am quite certain that, whatever generalisations he may make on the matter when he comes to reply, the Parliamentary Secretary will be entirely unable to substantiate the suggestion that there has been any undue or extravagant expenditure by education authorities as a result of the percentage grant.

The explanation, after all, is simple enough. The control of the Ministry does not depend only, and will in the future depend not at all, on the form of the grant. It depends on half a hundred other things. It can be varied infinitely. Those who listened to the very well-informed and clear speech of my hon. Friend the Member for Birmingham, All Saints (Mr. D. Howell) yesterday will find in that speech a complete answer to the suggestion that the reason for removing the percentage grant is to free authorities from controls. I shall come back to that in a moment.

Next, it is suggested that the block grant proposed will give local authorities greater responsibility and greater freedom. How can one reconcile that suggestion with the argument to which I have just referred? If local authorities in the past have spent too much, showing extravagance and carelessness—whatever the suggestion is—how can it be right to take that as the occasion for giving them greater freedom and greater responsibility?

The fact of the matter is that their freedom and their responsibility have existed all the time within certain limits and will continue to exist, but restricted as to their expenditure, when the Bill is passed. I shall come also to what that means. When I say that it has existed all the time, surely it is perfectly clear that the proper relationship between the education authorities and the Ministry is that laid down, in plain English and simple terms, in the very opening words of the Education Act, 1944, according to which there is to be the effective execution by local authorities"— under the Minister's control and direction— of the national policy for providing a varied and comprehensive educational service in every area. Do right hon. and hon. Members opposite not stand by that? That was a Coalition Bill. That was the statement in it of a principle so obvious and so clear that without it the educational progress since then would have been greatly hampered. Is it proposed that there shall no longer be a national policy or that it shall not be carried out on the lines suggested in that Act?

It is complete nonsense to correlate in any way the question of a percentage grant with the balance, as it were, of authority between the education authorities, on the one hand, and the Ministry, on the other hand, just as it is complete nonsense to correlate it in any way with the particular spending in the past or the responsibility of local authorities on financial matters.

The fact is that as regards control and as regards the carrying out of a national policy through local authorities, these matters do not come in. Where they do come in is this. It is perfectly obvious that if the Government are stabilising the Treasury's share, they do not mean that they are stabilising it at any higher figure than it is at present. As was said on 26th November, 1928, by the late Mr. Arthur Greenwood, when the former block grant was introduced, not in that case including education—this is plain English and it applies now: The block grant is really a Treasury device for saving the money of the taxpayer. If it does not do that, it fails in its purpose."—[OFFICIAL REPORT, 26th November, 1928; Vol. 223, c. 114.] Surely, right hon. and hon. Members opposite know perfectly well that that is the intention of the Bill and that the victims are the education services and the education authorities throughout the country, because seven-eighths of the expenditure in this general grant is educational expenditure.

But it is not only expenditure on education. It includes child welfare, health, Part III accommodation—smaller services as a matter of expenditure, but things which represent the most intimate and the most necessary services both from a local and from a national point of view, things which are national responsibilities—as, indeed, is education—and have to be carried out by the local authorities.

Before I leave the expenditure on education I want to say a word or two about the assurance given by the Minister of Education. He really had a difficult task today and he finally, with a great flourish, produced an assurance. His assurance was that it was no part of the Government's policy to reduce or to freeze—we must take, I think, the present expenditure on education—but to have a proper increase in accordance with Clause 2 of the Bill which, as was pointed out to the Minister in an intervention by my hon. Friend the Member for Gloucester (Mr. Diamond), provides that the sole judges of what is and what is not reasonable are the Government themselves. They are to decide what is a proper increase and what is not.

Mr. A. E. Cooper (Ilford, South)

Has that not always been the policy, even under a Labour Government? Did not the Labour Minister of Education always have the right to say to a local authority that this or that expenditure should not be incurred?

Mr. Mitchison

I am much obliged to the hon. Gentleman. That is exactly what I was going to say. What is the value of this assurance? Absolutely nothing. It simply says, in effect, "We are not going to cut it. We are not going to freeze it. We are going to allow development on the lines and to the extent that any Government have always allowed before." It comes to absolutely nothing whatever, and it comes to nothing whatever in a growing service, and that is the point which the right hon. Gentleman did not face.

During the period 1954–55 to 1957–58—the last year being, of course, a matter of official estimate there has been or will be a general increase of about 50 per cent. in the expenditure upon education in the country. One reason is perfectly obvious, and that is the growing number of children. Another is the passage of the "bulge," as I believe it is usually called, from the primary to the secondary schools.

Another is the admitted deficiencies at present in the system, the number of schools, as my hon. Friend the Member for Carmarthen (Lady Megan Lloyd George) and my hon. Friend the Member for Brecon and Radnor (Mr. Watkins) told us, which are still in use in the rural areas and which ought to have been replaced years ago. It is the deficiencies of the system, the strain upon it, and the realisation that if, after all, as my right hon. Friend the Member for South Shields (Mr. Ede) said, we cannot get a sound primary education it will be extremely doubtful whether this country can survive, which make an increase in the expenditure upon education not only large but necessary. I should find it very difficult indeed to believe, if the evidence of this Bill did not show it to me, that even the Tory Party could think of cutting education at the moment. But there we are.

I am still talking about finance, and there is one other financial matter I want to mention. It will not take more than a moment. There is one other financial provision which reflects—I was going to say on the good faith of the Government but I would rather say on the morals of the Treasury because notoriously it has not got any. That is the increase in the rating of industry, the increase from 25 per cent. to 50 per cent., and the fact that out of £30 million so obtained the Treasury takes £20 million.

I would point out only one thing—although it hits anyone in the eye. When the concession was made for just about the same amount in respect of shops the result was that the local authorities lost and the Treasury gained, because the shopkeepers were unable to deduct for Income Tax so large an actual payment of rates. The local authorities asked for help from the Treasury. Nothing doing, Now it is the other way round. Something is to be gained for the rates, and the Treasury would lose if nothing were done. "Heads I win, tails you lose." The Treasury is to be indemnified this time and the local authorities can go hang for all it cares. That kind of thing by ordinary citizens, whatever we may say about public authorities, would be a bit doubtful as a bit of business. But there it is, and this from the Government and the party who believes so strongly in helping local authorities—but not when it comes to letting them have any money.

Mr. Alan Green (Preston, South)

Who from?

Mr. Mitchison

I do not really know what the hon. Gentleman is talking about.

Mr. Green

Would the hon. and learned Gentleman say whether he believes that the local authorities have any money but the ratepayers' and the taxpayers' money? Does he confuse the ratepayers with the taxpayers or separate them?

Mr. Mitchison

I am much obliged to the hon. Member. How helpful I find hon. Members opposite. Even after a short visit to the Chamber the hon. Member is able to help me.

I was about to say that in that respect, as in the far more important respect of the substitution of a block grant for a percentage grant, what we are getting is the transfer of the burden from the taxpayer to the ratepayer. That is the ultimate business. I do not know what the hon. Member's views are about that, and I am sorry to tell him that I am not very interested. I know very definitely what mine are. Taxes are a much better method of levying for revenue than are rates. If one considers their incidence, rates come down on the poor man out of proportion, whereas taxes are, to the best of our wits and knowledge, more or less progressively distributed.

Mr. Rippon

is the hon. and learned Member therefore suggesting that we ought not to rate industry even 50 per cent.?

Mr. Mitchison

On the contrary. Surely, the hon. Member does know what I am talking about. It is perfectly clear that industry ought to be fully rerated. The point is that when local authorities would take advantage of the fact, the Treasury takes its whack, two-thirds in this case, and the result is to relieve the taxpayer at the expense of the ratepayer. And such also is the effect of the substitution of a general grant for a percentage grant. They both have the same effect, and rates are a tax which comes down hard on the small householders and the comparatively poor people. Income Tax is a far more progressive tax and therefore a much better one—and that goes for taxation generally as against rates.

Now I come to the position of local authorities in relation to the whole Bill. The Bill, and the way it has been treated, verges on the fraudulent. [HON. MEMBERS: "Oh."] If the Minister can talk about immoral arguments I can tell him that his Bill is really fraudulent. The Government have been altogether too smart with the local authorities. Let us look at what has happened. The local authorities have been asked to concede the whole of the Government's case and the whole of the Government's machinery for substituting a block grant for a percentage grant, with the object of stabilising and limiting the Government's contribution towards local expenditure. At the same time, the Bill is presented and it has the priority which has been referred to in the letter written to the County Councils' Association.

Local authorities do not know how much the block grant will be and how it will be worked out, other than on the principles in the Bill. They do not know, for instance, what the length of the period of the grant is to be. That is left at large. They do not know all kinds of things. They do not know, for example, how local differences will be dealt with under the Bill.

Again they have been offered this Tory freedom. Tory freedom means, "If you have enough money to do something you are at liberty to do it, and if you have not, you are not." It has just as much application to local authorities as it has to private individuals. This is the power of the purse in relation to local authorities, just as a great many other Measures brought in by the Tory Party have made the power of the purse the effective control over private people's expenditure, too. That is exactly what it is. This is the freedom that the local authorities are to have.

As to the decontrol which the local authorities are to have, that is a matter which is now under negotiation. We do not know what it will be. We have no doubt that it will amount to something, and so on and so forth, but the net result of this extraordinary proceeding is that the local authorities have been sold the Bill on two complete uncertainties—how much they will get and what, if any, decontrol they will get. And I would not give much for their hopes on either of these two questions.

I repeat that this is a thoroughly reactionary Bill in its relation to all the expenditure proposed. Its real object is to cut tax expenditure and to put more on the rates. Its object, too, is to attack the education service without incurring the public odium of doing so. That is what these two right hon. Gentlemen between them are responsible for doing.

Mr. N. Nicolson

Does the hon. and learned Gentleman really believe all that?

Mr. Mitchison

There is no need to ask that type of question. I do not say things in this House in which I do not believe.

9.26 p.m.

The Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. J. R. Bevins)

Although I do not agree with all that has been said by the hon. and learned Gentleman the Member for Kettering (Mr. Mitchison), we can at least agree that we have had a helpful and, I think, promising debate during the last two days. May I say on behalf of my right hon. Friend and myself how grateful we are that not a single voice has been raised from the benches on this side of the House against any major aspect of the Bill.

Mr. James Griffiths (Llanelly)

Does the hon. Gentleman believe that?

Mr. Bevins

The right hon. Gentleman invites me to say whether I believe that. Unlike the right hon. Gentleman, my right hon. Friend and I have heard practically every speech made in this debate. Although, naturally, in a free party, certain of my hon. Friends have expressed reservations, I repeat that none of my hon. Friends has expressed hostility to the major provisions of the Bill.

Perhaps it will be for the convenience of the House if I attempt to reply to some of the rather more detailed points that have been raised before I address myself to the terms of the Amendment. I was asked, first, about the special problems of the Principality. The hon. Gentleman the Member for Brecon and Radnor (Mr. Watkins), supported by the hon. Lady the Member for Carmarthen (Lady Megan Lloyd George), asked whether it would not be possible to have written into the Bill a provision for a Welsh-speaking member of the Commission for Wales rather than leave this as an undertaking by my right hon. Friend.

As the House knows, my right hon. Friend has given the assurance that, if at all possible, there will be a bi-lingual member of the Commission, and he adheres to that assurance. At the same time, I do not think that it would be appropriate to write that provision into the Bill.

Mr. S. O. Davies (Merthyr Tydvil)

Why not?

Mr. Bevins

The hon. and learned Gentleman the Member for Brecon and Radnor thought that the Bill should guarantee the existing boundaries between England and Wales. He quoted the White Paper dealing with the status of local authorities, which reflected the general local authority view that there should be no major change in the English-Welsh boundary, and not even, for that matter, any minor change except where there was local agreement. It certainly is the intention of my right hon. Friend to adopt this approach when considering any proposals which the Commission may make, but it is not a matter which could properly be covered by a veto and prohibition in the Bill itself.

The hon. Member for Brecon and Radnor and the hon. Lady the Member for Carmarthen rightly pointed out that special financial problems affected local authorities and the county councils in Wales. They indicated that the costs of local government services generally are higher in the scattered areas of Wales than they are in the United Kingdom as a whole. That, of course, is perfectly true, but I assure them that the factor of dispersion and low population in many areas of Wales is taken into account in the Bill and under existing arrangements.

There is a factor for low density of population in the general grant, and the rate-deficiency grant provisions, which are still continuing under the present arrangements, provide that if the rate product per head of population is below the national average then that will be made up to the national average through the Rate-deficiency Grant. All the Welsh counties at present are receivers of equalisation grants and I think that all the Welsh counties will continue to be receivers of rate-deficiency grants. The factor for sparsity of population is also increased in the rate-deficiency grant formula and that is a change from the present financial pattern. Therefore, those hon. Members on both sides of the House who sit for Welsh constituencies can feel that the Government have certainly tried to make due allowance for the various authorities in the Principality.

Several hon. Members thought that the boundaries of the special review areas, the conurbations, had been drawn too narrowly. On the other hand, my hon. Friend the Member for the City of Chester (Mr. Temple) took the opposite view, that they had been drawn too widely. Obviously, there is room for argument about what the precise areas should be, but the Bill provides machinery whereby those areas may be varied on the initiative of either the Commission itself or my right hon. Friend.

My hon. Friend the Member for Rutland and Stamford (Sir R. Conant) expressed the fear that under the Bill the Commission might conceivably recommend the abolition of a county and there appeared to him to be no obligation on my right hon. Friend to hold a public inquiry in that event. I can assure my hon. Friend that my right hon. Friend would certainly not contemplate asking Parliament to abolish a county without holding a full public inquiry into objections.

The right hon. Member for Rochester and Chatham (Mr. Bottomley), whom we welcome to the arena of local government in the House of Commons, also expressed the fear that there were no powers in the Bill to form a county borough out of an area like Rochester, Chatham and Gillingham taken together. I am advised that the Bill is wide enough to do that as it stands, but if there should prove to be any dubiety on that score we should certainly be prepared to see that that was put right when the Bill comes under more detailed examination at a later stage.

The hon. Member for Mansfield (Mr. B. Taylor) inquired yesterday about the stand-still period following a review of county districts by a county council. The position is that after the first review there will be a standstill period of at least ten years in that particular county, corresponding to the standstill of fifteen years in other circumstances.

My hon. Friend the Member for Chester asked whether, under Clause 17 (1), the words: effective …local government could be taken to mean economic and efficient local government. That is precisely what the expression is intended to mean.

There were also questions asked about functions. The right hon. Gentleman the Member for Rochester and Chatham rather suggested that the original intention was to confer direct services to district councils, but my right hon. Friend has changed his mind and now decided upon delegation. That is not so. For health, welfare and education it is still a matter of delegation. The hon. Member for Oldbury and Halesowen (Mr. Moyle) will be glad to know that local authorities which were excepted districts for the purposes of the Education Act will continue to be excepted districts.

The hon. Members for Hastings (Mr. Cooper-Key) and Exeter (Mr. Dudley Williams) urged upon me that seaside towns should receive greater financial consideration, partly because they do not qualify for rate-deficiency grants and partly because many of the seaside resorts now include a large strata of elderly people. The suggestion was that the rate deduction factor in the general grant should be rather less than 12d. This factor can be considered, of course, when the Bill goes to Committee and what the amount should be when my right hon. Friend is drawing up the first general grant order. I ask my hon. Friends to bear in mind that in part the general grant is in substitution of a collection of previous percentage grants and that one of those grants was the percentage grant for education, which included a rate deduction factor of 17d. We are obliged to bear that in mind.

My hon. Friends the Members for Chelmsford (Mr. Ashton) and for East Grinstead (Mrs. Emmet) put forward the view that the first grant should cover a period of one year instead of two years as proposed in the Bill. One of the main advantages of the general grant is that it provides a stable financial basis for the planned development of services, because each local authority will know in advance, within very narrow limits, what grant it will receive over the next two years. That advantage would be lost if the grant were fixed for a period of only one year ahead.

I now turn to the terms of the Amendment—

Mr. Mitchison

I shall not keep the hon. Gentleman long. He has referred to the Committee stage of the Bill. I earnestly hope that the Bill will be taken in the House in Committee. It makes a change of immense importance regarding the block grant. I am reminded that when the 1949 Bill was sent upstairs the hon. Gentleman's party voted against it being sent upstairs. The Boundary Commission Bill, in 1945, was taken on the Floor of the House.

Mr. Bevins

Whether the Committee stage of the Bill is taken on the Floor of the House or upstairs is not a matter for me. What is a matter for me and my right hon. Friend is to make sure that it secures a Second Reading. It was for that reason that I proposed to examine the Amendment in a little detail.

First, the Amendment criticises Her Majesty's Government for declining fully to rerate industry. The hon. Member for Stoke-on-Trent, North (Mrs. Slater) and one other hon. Member opposite went rather further, and urged that the derating of agriculture should also be abolished. The right hon. Member for Rochester and Chatham observed rather blithely that he saw no reason why industry should not pay full rates. He simply left it at that, without any further argument.

It really is not quite so simple as all that. The effect of the revaluation of industrial properties on the basis of current values, together with the 50 per cent. rerating proposed in the Bill, would be to increase the proportion of rates paid by industry to about three times what it was before revaluation. If, as the Amendment suggests, we had a complete rerating of 100 per cent., that proportion would rise to about five times what it was before revaluation.

I frankly concede to hon. Members opposite that there may well be some industries and some firms which could take that added imposition in their stride, but there are others who might find it necessary to take account of that increased imposition in the prices which they charged to the consumers, either here or abroad.

Mr. A. G. Bottomley (Rochester and Chatham)

One of my explanations was that they could afford full rating because they could claim tax relief. I gave several other reasons, but to be kind to my hon. Friends I did not develop them.

Mr. Bevins

I am obliged to the right hon. Gentleman. It is worth while pointing out that although the incidence of rerating of industry would obviously vary from industry to industry and from firm to firm, the industry which would certainly be more affected than others would be that of food manufacturing. There the incidence would inevitably be reflected in the level of prices and the cost of living.

As the House knows, the Local Government Act, 1948, dealt very largely with valuation for rating, but it did nothing whatever about the rerating either of industry or of agriculture; indeed, when the right hon. Member for Ebbw Vale (Mr. Bevan), who was in charge of that Measure, was asked why derating was not abolished either in whole or in part at that time, he said that it was too difficult to put the eggs back into the shells then. That was in 1948. At least my right hon. Friend has made an attempt to do that difficult thing. We are certainly not prepared to look at this question of abolishing derating solely within the context of local government reform. We must have regard to its probable economic consequences.

Mr. John Diamond (Gloucester)

The Minister yesterday gave us an undertaking that the hon. Member, in replying, would answer our questions. The question I now wish to ask him is that which I asked his right hon. Friend yesterday. How much is involved? What is the cost of rerating fully, as opposed to 50 per cent., either per £ of sales or in terms of the profit of the industry in question?

Mr. Bevins

As my right hon. Friend said when he dealt with the hon. Member's intervention yesterday, the percentage which full rerating would bear to industrial costs would vary widely from industry to industry and also from firm to firm. As I said before, the industry which would find complete rerating the biggest burden would be that of food manufacture. It would be such a burden that almost inevitably it would be reflected in prices.

The Amendment complains that we are not giving the local authorities the full benefit of partial rerating. I wish that right hon. and hon. Gentlemen opposite would look at the record, and particularly at the speech of the right hon. Member for Bishop Auckland in the debate on the Valuation and Rating Bill, on 21st May, 1953. On that occasion the right hon. Gentleman said: '… Is anyone simple enough to believe that, if de-rating is done away with, the Exchequer assistance to local authorities will remain wholly unchanged?"—[OFFICIAL REPORT, 21st May, 1953; Vol. 515, c. 2369.] The right hon. Gentleman's comment on that statement was, "Not at all." I suggest to the House that in putting that phrase in the Amendment right hon. and hon. Gentlemen opposite are either being disingenuous or politically naïve.

The major criticism of the general grant is that general grants mean reduced grants and, therefore, reduced expenditure on the various services for which local authorities are responsible. What hon. Members opposite are saying is that the total amount of the grant is smaller than the total of the percentage grant which they replace. I consider that to be a fair summary of the arguments advanced by hon. Members opposite. Clause 2, which deals chiefly with the calculation of the grant, imposes a duty on my right hon. Friend to take account of five separate factors. Two of them, the total expenditure of local authorities in the last year and the present level of costs, are not matters of conjecture or speculation. They are matters of ascertainable fact. The remaining three, changes in costs, changes in demand for services and the need to develop the services, can be measured with reasonable accuracy.

This afternoon my right hon. Friend the Minister of Education dealt with the intentions of his Department about the development of education services. I wish to say a word about future changes in costs, a matter which, I think, is genuinely exercising the minds of hon. Members and others in the country. Yesterday, we were told by the right hon. Member for Rochester and Chatham that it was quite possible that this grant would be "eroded away by inflation." I feel that a great deal of the hostility to the general grant springs from the fear, sincerely felt in some quarters, that inflation will continue and the extra cost of education and other local government services will fall on the local authorities and not on the Government.

This fear was voiced in Manchester the other day by the Secretary of the Association of Education Committees. He said that if the block grant was introduced, and the rates of Manchester did not go up, he would return to Manchester and publicly eat his hat. Some people have swallowed so many far-fetched propositions in recent times that they would not have a great deal of difficulty in swallowing their hats. It is a fact that many hon. Members opposite have come to accept inflation as part of the natural order of things—like Income Tax, three-line Whips, and the rest.

The Leader of the Opposition is an exception to the rule. Speaking recently to a public gathering in Cheshire he used these words: There is reason to believe that the cost of living will now be stabilised. We believe that for once in a while the right hon. Gentleman was making an accurate forecast, that the fears of further rises in costs are unfounded and that on this, as on other scores, the opposition to the general grant is misconceived.

It has been implicit in practically every speech of the Opposition today—it was stated specifically by the hon. Member for Fulham (Mr. M. Stewart)—that the working of the general grant must cause local authorities to behave parsimoniously. There is no evidence to support that view. [HON. MEMBERS: "Oh."] Some hon. Gentleman may feel that that is likely to happen; all I am saying is that there is no evidence as yet to support the view.

The House may remember what happened during an earlier period when a block grant was in operation. During 1931–39, local government expenditure on rate fund services rose by about 22 per cent. Some of the increase was due to housing expenditure. Hon. Members will recall that a housing drive was in progress at that time and that housing expenditure rose by 31 per cent. during the period. The point to which I would draw the attention of the House is that the expenditure on services which were assisted by specific grants increased by a lesser percentage than the services which had a general Exchequer grant. Education expenditure, helped at that time as it is now by a specific grant, rose by 16 per cent. and police expenditure by 18 per cent. Other services, which were not aided by specific grants, rose by as much as 24 per cent.

Yesterday, my right hon. Friend referred to the nuisance of the accounting controls which are inseparable from the payment of percentage grants. On more than one occasion local authority associations have brought to the notice of my right hon. Friend and his predecessors the many disadvantages which flow from that system, and how they inevitably result in delays of payments due to local authorities—at least, payments the local authorities thought were due to them—because of disputes over admissibility of particular claims.

Over and over again it has been alleged in the debate, outside the ranks of Government supporters, that the general grant has not a friend outside this House. If this were true it would be a serious allegation. But is it true? As my hon. Friend the Member for Westbury (Sir R. Grimston) very rightly pointed out yesterday, the Urban District Councils' Association has already agreed in principle with the general grant. The Association of Municipal Corporations has agreed to it in principle and so has the County Councils' Association.

I have read the terms of the Amendment with very great care. Apart from the rerating of industry and retention of percentage grants, what does the party opposite really want? What are its views on areas, conurbation and functions? If it has any views on those vexed questions it has been very clever in concealing them in the last two days. I have been trying to find out.

The other day I was reading the Labour Party's Local Government Handbook for 1951. In it there is an article entitled "Labour's Impact on Local Government", by a gentleman named Mr. Morgan Phillips. He said: The outstanding political event of this century was the birth of the Labour Party in the year 1900. Indeed, it would be ungracious of me to attempt to contradict a statement of that sort coming from such an authority. He went on to say: Ever since that time the Labour Party has always taken a far more genuine interest in local government than any other party. All I want to do is to invite the House to consider how the party opposite demonstrated this superior interest in local government when it had the chance. Between 1945 and 1951 it took away from local government many of local government's most cherished functions. In 1948, it introduced the Local Government Bill, which was concerned mainly with rating and valuation, and several of the provisions of that Act affecting valuation were so administratively unworkable—tagging along behind—that it had to be amended by the Government which followed.

Since the Election of 1951, we have had policy statement after policy statement by the party opposite. In "Challenge to Britain", "Forward with Labour", and all the rest, they say: Labour will investigate the functions and structure of local government … and We shall review local government finance … and All this will take time. Is it any wonder that in 1955 when the annual conference of the party opposite took place at Margate—a place so fond to the heart of the hon. and learned Member for Kettering—the first speaker who went to the rostrum to talk about local government had this to say: Once again we are lagging behind. We are waiting for the Tories to put forward their views and we are going to tag along behind. That is what the party opposite has been doing during the last two days.

Question put, That the words proposed to be left out stand part of the Question:—

The House divided: Ayes 309, Noes 252.

Division No. 17.]	AYES	[10.0 p.m.
Agnew, Sir Peter	Erroll, F. J.	Johnson, Dr. Donald (Carlisle)
Aitken, W. T.	Farey-Jones, F. W.	Johnson, Eric (Blackley)
Allan, R. A. (Paddington, S.)	Finlay, Graeme	Johnson, Howard (Kemptown)
Alport, C. J. M.	Fisher, Nigel	Jones, Rt. Hon. Aubrey (Hall Green)
Amery, Julian (Preston, N.)	Fletcher-Cooke, C.	Joseph, Sir Keith
Anstruther-Gray, Major Sir William	Forrest, G.	Joynson-Hicks, Hon. Sir Lancelot
Ashton, H.	Fort, R.	Kaberry, D.
Astor, Hon. J. J.	Foster, John	Keegan, D.
Atkins, H. E.	Fraser, Hon. Hugh (Stone)	Kerby, Capt. H. B.
Baldook, Lt.-Cmdr. J. M.	Fraser, Sir Ian (M'cmbe & Lonsdale)	Kerr, Sir Hamilton
Baldwin, A. E.	Freeth, Denzil	Kershaw, J. A.
Balniel, Lord	Galbraith, Hon. T. G. D.	Kimball, M.
Barber, Anthony	Gammans, Lady	Kirk, P. M.
Barlow, Sir John	Garner-Evans, E. H.	Lagden, G. W.
Barter, John	George, J. C. (Pollok)	Lambert, Hon. G.
Baxter, Sir Beverley	Gibson-Watt, D.	Lambton, Viscount
Bell, Philip (Bolton, E.)	Glover, D.	Lancaster, Col. C. G.
Bell, Ronald (Bucks, S.)	Glyn, Col. R.	Langford-Hott, J. A.
Bennett, F. M. (Torquay)	Godber, J. B.	Leather, E. H. C.
Bennett, Dr. Reginald	Gomme-Duncan, Col. Sir Alan	Leavey, J. A.
Bevins, J. R. (Toxteth)	Goodhart, Philip	Leburn, W. G.
Bidgood, J. C.	Gough, C. F. H.	Legge Bourke, Maj. E A. H.
Biggs-Davison, J. A.	Gower, H. R.	Legh, Hon. Peter (Petersfield)
Bingham, R. M.	Graham, Sir Fergus	Lennox Boyd, Rt. Hon. A. T.
Birch, Rt. Hon. Nigel	Grant, W. (Woodside)	Lindsay, Hon. James (Devon, N.)
Bishop, F. P.	Grant-Ferris, Wg Cdr. R. (Nantwich)	Lindsay, Martin (Solihull)
Black, C. W.	Green, A.	Linstead, Sir H. N.
Body, R. F.	Gresham Cooke, R.	Llewellyn, D. T.
Boothby, Sir Robert	Grimston, Hon. John (St. Albans)	Lloyd, Rt. Hon. G. (Sutton Coldfield)
Bossom, Sir Alfred	Grimston, Sir Robert (Westbury)	Lloyd, Maj. Sir Guy (Renfrew, E.)
Boyd-Carpenter, Rt. Hon. J. A.	Grosvenor, Lt.-Col. R. G.	Lloyd, Rt. Hon. Selwyn (Wirral)
Boyle, Sir Edward	Gurden, Harold	Low, Rt. Hon. Sir Toby
Braine, B. R.	Hall, John (Wycombe)	Lucas, Sir Jocelyn (Portsmouth, S.)
Braithwaite, Sir Albert (Harrow, W.)	Hare, Rt. Hon. J. H.	Lucas, P. B. (Brentford & Chiswick)
Bromley-Davenport, Lt.-Col. W. H.	Harris, Frederic (Croydon, N.W.)	Lucas-Tooth, Sir Hugh
Brooke, Rt. Hon. Henry	Harris, Reader (Heston)	McAdden, S. J.
Brooman-White, R. C.	Harrison, A. B. C. (Maldon)	Macdonald, Sir Peter
Browne, J. Nixon (Craigton)	Harrison, Col. J. H. (Eye)	Mackeson, Brig. Sir Harry
Bryan, P.	Harvey, Sir Arthur (Macclesfd)	McKibbin, A. J.
Bullus, Wing Commander E. E.	Harvey, Ian (Harrow, E.)	Mackie, J. H. (Galloway)
Burden, F. F. A.	Harvey, John (Walthamstow, E.)	McLaughlin, Mrs. P.
Butcher, Sir Herbert	Harvie-Watt, Sir George	Maclay, Rt. Hon. John
Butler, Rt. Hn. R. A. (Saffron Walden)	Hay, John	Maclean, Sir Fitzroy (Lancaster)
Campbell, Sir David	Head, Rt. Hon. A. H.	McLean, Neil (Inverness)
Carr, Robert	Heath, Rt. Hon. E. R. G.	Macleod, Rt. Hn. Iain (Enfield, W.)
Cary, Sir Robert	Henderson, John (Cathcart)	MacLeod, John (Ross & Cromarty)
Channon, Sir Henry	Henderson-Stewart, Sir James	Macmillan, Maurice (Halifax)
Chichester-Clark, R.	Hesketh, R. F.	Macpherson, Niall (Dumfries)
Churchill, Rt. Hon. Sir Winston	Hicks-Beach, Maj. W. W.	Maddan, Martin
Clarke, Brig. Terence (Portsmth, W.)	Hill, Rt. Hon Charles (Luton)	Maitland, Cdr. J. F. W. (Horncastle)
Cole, Norman	Hill, Mrs. E. (Wythenshawe)	Maitland, Hon. Patrick (Lanark)
Conant, Maj. Sir Roger	Hill, John (S. Norfolk)	Manningham-Buller, Rt. Hn. Sir R.
Cooke, Robert	Hinchingbrooke, Viscount	Markham, Major Sir Frank
Cooper, A. E.	Hirst, Geoffrey	Marlowe, A. A. H.
Cooper-Key, E. M.	Hobson, John (Warwick & Leam'gt'n)	Marples, Rt. Hon. A. E.
Cordeaux, Lt.-Col. J. K.	Holland-Martin, C. J.	Marshall, Douglas
Corfield, Capt. F. V.	Hope, Lord John	Mathew, R.
Craddock, Beresford (Spelthorne)	Hornby, R. P.	Maudling, Rt. Hon. R.
Crosthwaite-Eyre, Col. O. E.	Hornsby-Smith, Miss M. P.	Mawby, R. L.
Crowder, Petre (Ruislip-Northwood)	Horobin, Sir Ian	Maydon, Lt.-Comdr. S. L. C.
Currie, G. B. H.	Horsbrugh, Rt. Hon. Dame Florence	Medlicott, Sir Frank
Dance, J. C. G.	Howard, Gerald (Cambridgeshire)	Milligan, Rt. Hon. W. R.
Davidson, Viscountess	Howard, Hon. Greville (St. Ives)	Molson, Rt. Hon. Hugh
D'Avigdor-Goldsmid, Sir Henry	Howard, John (Test)	Moore, Sir Thomas
Deedes, W. F.	Hughes Hallett, Vice-Admiral J.	Morrison, John (Salisbury)
Digby, Simon Wingfield	Hughes-Young, M. H. C.	Mott Radclyffe, Sir Charles
Dodds-Parker, A. D.	Hulbert, Sir Norman	Nabarro, G. D. N.
Donaldson, Cmdr. C. E. McA.	Hurd, A. R.	Neave, Airey
Doughty, C. J. A.	Hutchison, Michael Clark (E'b'gh, S.)	Nicholls, Harmar
Drayson, G. B.	Hutchison, Sir Ian Clark (E'b'gh, W.)	Nicholson, Godfrey (Farnham)
du Cann, E. D. L.	Hutchison, Sir James (Scotstoun)	Nicolson, N. (B'n'm'th, E. & Chr'ch)
Duncan, Sir James	Hyde, Montgomery	Nugent, G. R. H.
Duthie, W. S.	Hylton-Foster, Rt. Hon. Sir Harry	Ormsby-Gore, Rt. Hon. W. D.
Eccles, Rt. Hon. Sir David	Iremonger, T. L.	Orr, Capt. L. P. S.
Elliott, R. W. (N'castleuponTyne, N.)	Irvine, Bryant Godman (Rye)	Orr-Ewing, Charles Ian (Hendon, N.)
Emmet, Hon. Mrs. Evelyn	Jenkins, Robert (Dulwich)	Orr Ewing, Sir Ian (Weston-S-Mare)
Errington, Sir Eric	Jennings, Sir Roland (Hallam)	Osborne, C.
Pannell, N. A. (Kirkdale)	Sandys, Rt. Hon. D.	Thompson, Kenneth (Walton)
Partridge, E.	Scott-Miller, Cmdr. R.	Thompson, Lt.-Cdr. R. (Croydon, S.)
Peel, W. J.	Sharples, R. C.	Thorneycroft, Rt. Hon. P.
Peyton, J. W. W.	Shepherd, William	Thornton-Kemsley, C. N.
Pickthorn, K. W. M.	Simon, J. E. S. (Middlesbrough, w.)	Tiley, A. (Bradford, W.)
Pike, Miss Mervyn	Smyth, Brig. Sir John (Norwood)	Tilney, John (Wavertree)
Pilkington, Capt. R. A.	Soames, Christopher	Turton, Rt. Hon. R. H.
Pitman, I. J.	Spearman, Sir Alexander	Tweedsmuir, Lady
Pitt, Miss E. M.	Speir, R. M.	Vane, W. M. F.
Pott, H. P.	Spence, H. R. (Aberdeen, W.)	Vaughan-Morgan, J. K.
Powell, J. Enoch	Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)	Vickers, Miss Joan
Price, David (Eastleigh)	Stanley, Capt. Hon. Richard	Vosper, Rt. Hon. D. F.
Price, Henry (Lewisham, W.)	Stevens, Geoffrey	Wakefield, Sir Wavell (St. M'lebone)
Prior-Palmer, Brig, O. L.	Steward, Harold (Stockport, S.)	Walker-Smith, Rt. Hon. Derek
Profumo, J. D.	Steward, Sir William (Woolwich W.)	Wall, Major Patrick
Rawlinson, Peter	Stoddart-Scott, Col. Sir Malcolm	Ward, Rt. Hon. G. R. (Worcester)
Redmayne, M.	Storey, S.	Watkinson, Rt. Hon. Harold
Rees-Davies, W. R.	Stuart, Rt. Hon. James (Moray)	Webbe, Sir H.
Remnant, Hon. P.	Studholme, Sir Henry	Whitelaw, W. S. I.
Renton, D. L. M.	Summers, Sir Spencer	Williams, Paul (Sunderland, S.)
Ridsdale, J. E.	Sumner, W. D. M. (Orpington)	Williams, R. Dudley (Exeter)
Rippon, A. G. F.	Taylor, Sir Charles (Eastbourne)	Wood, Hon. R.
Robertson, Sir David	Taylor, William (Bradford, N.)	Woollam, John Victor
Robson Brown, Sir William	Teeling, W.	Yates, William (The Wrekin)
Roper, Sir Harold	Temple, John M.
Ropner, Col. Sir Leonard	Thomas, Leslie (Canterbury)	TELLERS FOR THE AYES:
Russell, R. S.	Thomas, P. J. M. (Conway)	Mr. Oakshott and Mr. Wills.
NOES
Ainsley, J. W.	Donnelly, D. L.	Johnson, James (Rugby)
Albu, A. H.	Dugdale, Rt. Hn. John (W. Brmwch)	Johnston, Douglas (Paisley)
Allaun, Frank (Salford, E.)	Dye, S.	Jones, Rt. Hon. A. Creech (Wakefield)
Allen, Arthur (Bosworth)	Ede, Rt. Hon. J. C.	Jones, David (The Hartlepools)
Allen, Scholefield (Crewe)	Edelman, M.	Jones, Elwyn (W. Ham, S.)
Anderson, Frank	Edwards, Rt. Hon. John (Brighouse)	Jones, Jack (Rotherham)
Awbery, S. S.	Edwards, Rt. Hon. Ness (Caerphilly)	Jones, T. W. (Merioneth)
Baird, J.	Edwards, Robert (Bilston)	Kenyon, C.
Balfour, A.	Edwards, W. J. (Stepney)	Key, Rt. Hon. C. W.
Bence, C. R. (Dunbartonshire, E.)	Evans, Albert (Islington, S.W.)	King, Dr. H. M.
Benn, Hn. Wedgwood (Bristol, S.E.)	Evans, Edward (Lowestoft)	Lawson, G. M.
Benson, G.	Fernyhough, E.	Ledger, R. J.
Beswick, Frank	Fienburgh, W.	Lee, Frederick (Newton)
Blackburn, F.	Finch, H. J.	Lee, Miss Jennie (Cannock)
Blenkinsop, A.	Fletcher, Eric	Lever, Harold (Cheetham)
Blyton, W. R.	Foot, D. M.	Lewis, Arthur
Boardman, H.	Fraser, Thomas (Hamilton)	Lindgren, G. S.
Bottomley, Rt. Hon. A. G.	George, Lady Megan Lloyd (Car'then)	Lipton, Marcus
Bowden, H. W. (Leicester, S.W.)	Gibson, C. W.	Logan, D. G.
Bowen, E. R. (Cardigan)	Gooch, E. G.	MacColl, J. E.
Bowles, F. G.	Greenwood, Anthony	MacDermot, Niall
Boyd, T. C.	Grey, C. F.	McGhee, H. G.
Braddock, Mrs. Elizabeth	Griffiths, David (Rother Valley)	McGovern, J.
Brockway, A. F.	Griffiths, Rt. Hon. James (Llanelly)	McInnes, J.
Broughton, Dr. A. D. D.	Griffiths, William (Exchange)	McKay, John (Wallsend)
Brown, Rt. Hon. George (Belper)	Hall, Rt. Hn. Glenvil (Colne Valley)	McLeavy, Frank
Brown, Thomas (Ince)	Hamilton, W. W.	MacMillan, M. K. (Western Isles)
Burke, W. A.	Hannan, W.	MacPherson, Malcolm (Stirling)
Burton, Miss F. E.	Harrison, J. (Nottingham, N.)	Mahon, Simon
Butler, Herbert (Hackney, C.)	Hastings, S.	Mallalieu E. L. (Brigg)
Butler, Mrs. Joyce (Wood Green)	Hayman, F. H.	Mallalieu, J. P. W. (Huddersfd, E.)
Callaghan, L. J.	Healey, Denis	Mann, Mrs. Jean
Castle, Mrs. B. A.	Henderson, Rt. Hn. A. (Rwly Regis)	Marquand, Rt. Hon. H. A.
Champion, A. J.	Herbison, Miss M.	Mason, Roy
Chapman, W. D.	Hewitson, Capt. M.	Mayhew, C. P.
Clunie, J.	Hobson, C. R. (Keighley)	Mellish, R. J.
Coldrick, W.	Holman, P.	Messer, Sir F.
Collick, P. H. (Birkenhead)	Holmes, Horace	Mikardo, Ian
Collins, V. J. (Shoreditch & Finsbury)	Holt, A. F.	Mitchison, G. R.
Corbet, Mrs. Freda	Howell, Charles (Perry Barr)	Moody, A. S.
Cove, W. G.	Howell, Denis (All Saints)	Morris, Percy (Swansea, W.)
Craddook, George (Bradford, S.)	Hoy, J. H.	Morrison, Rt. Hn. Herbert (Lewis'm, S.)
Cronin, J. D.	Hughes, Cledwyn (Anglesey)	Mort, D. L.
Crossman, R. H. S.	Hughes, Emrys (S. Ayrshire)	Moss, R.
Cullen, Mrs. A.	Hunter, A. E.	Moyle, A.
Dalton, Rt. Hon. H.	Hynd, H. (Accrington)	Mulley, F. W.
Darling, George (Hillsborough)	Hynd, J. B. (Attercliffe)	Neal, Harold (Bolsover)
Davies, Rt. Hn. Clement (Montgomery)	Irvine, A. J. (Edge Hill)	Noel-Baker, Francis (Swindon)
Davies, Ernest (Enfield, E.)	Irving, Sydney (Dartford)	Noel-Baker, Rt. Hon. P. (Derby, S.)
Davies, Harold (Leek)	Isaacs, Rt. Hon. C. A.	O'Brien, Sir Thomas
Davies, Stephen (Merthyr)	Janner, B.	Oliver, G. H.
Deer, G.	Jay, Rt. Hon. D. P. T.	Oram, A. E.
Delargy, H. J.	Jeger, George (Goole)	Orbach, M.
Diamond, John	Jeger, Mrs. Lena (Holbn & St. Pncs, S.)	Oswald, T.
Dodds, N. N.	Jenkins, Roy (Stechford)	Owen, W. J.

Padley, W. E.	Royle, C.	Usborne, H. C.
Paget, R. T.	Shinwell, Rt. Hon. E.	Viant, S. P.
Paling, Rt. Hon. W. (Dearne Valley)	Short, E. W.	Wade, D. W.
Paling, Will T. (Dewsbury)	Shurmer, P. L. E.	Warbey, W. N.
Palmer, A. M. F.	Silverman, Julius (Aston)	Watkins, T. E.
Panned, Charles (Leeds, W.)	Silverman, Sydney (Nelson)	Weitzman, D.
Pargiter, G. A.	Simmons, C. J. (Brierley Hill)	Wells, Percy (Faversham)
Parker, J.	Skeffington, A. M.	Wells, William (Walsall, N.)
Parkin, B. T.	Slater, Mrs. H. (Stoke, N.)	West, D. G.
Paton, John	Slater, J. (Sedgefield)	Wheeldon, W. E.
Peart, T. F.	Smith Ellis (Stoke, S.)	White, Mrs. Eirene (E. Film)
Plummer, Sir Leslie	Snow, J. W.	White, Henry (Derbyshire, N.E.)
Prentice, R. E.	Soskice, Rt. Hon. Sir Frank	Wigg, George
Price, J. T. (Westhoughton)	Sparks, J. A.	Wilcook, Group Capt. C. A. B.
Probert, A. R.	Steele, T.	Wilkins, W. A.
Proctor, W. T.	Stewart, Michael (Fulham)	Willey, Frederick
Pryde, D. J.	Stonehouse, John	Williams, Rev. Llwelyn (Ab'tillery)
Pursey, Cmdr. H.	Stones, W. (Consett)	Williams, Ronald (Wigan)
Randall, H. E.	Strauss, Rt. Hon. George (Vauxhall)	Williams, W. R. (Openshaw)
Rankin, John	Stross, Dr. Barnet (Stoke-on-Trent, C.)	Willis, Eustace, (Edinburgh, E.)
Redhead, E. C.	Summerskill, Rt. Hon. E.	Wilson, Rt. Hon. Harold (Huyton)
Reeves, J.	Swingler, S. T.	Winterbottom, Richard
Reid, William	Sylvester, G. O.	Woodburn, Rt. Hon. A.
Rhodes, H.	Taylor, Bernard (Mansfield)	Woof, R. E.
Roberts, Rt. Hon. A.	Taylor, John (West Lothian)	Yates, W. (Ladywood)
Roberts, Albert (Normanton)	Thomas, George (Cardiff)	Younger, Rt. Hon. K.
Roberts, Goronwy (Caernarvon)	Thomas, Iorwerth (Rhondda, W.)	Zilliacus, K.
Robinson, Kenneth (St. Pancras, N.)	Thornton, E.
Rogers, George (Kensington, N.)	Tomney, F.	TELLERS FOR THE NOES:
Ross, William	Ungoed Thomas, Sir Lynn	Mr. Popplewell and Mr. Pearson

Bill read a Second time.

Motion made, and Question put, That the Bill be committed to a Committee of the whole House.—[Mr. Bowden.]

The House divided: Ayes 251, Noes 308.

Division No. 18.]	AYES	[10.12 p.m.
Ainsley, J. W.	Dalton, Rt. Hon. H.	Hobson, C. R. (Keighley)
Albu, A. H.	Darling, George (Hillsborough)	Holman, P.
Allaun, Frank (Salford, E.)	Davies, Rt. Hn. Clement (Montgomery)	Holmes, Horace
Allen, Arthur (Bosworth)	Davies, Ernest (Enfield, E.)	Holt, A. F.
Allen, Scholefield (Crewe)	Davies, Harold (Leek)	Howell, Charles (Perry Barr)
Anderson, Frank	Davies, Stephen (Merthyr)	Howell, Denis (All Saints)
Awbery, S. S.	Deer, G.	Hoy, J. H.
Baird, J.	Delargy, H. J.	Hughes, Cledwyn (Anglesey)
Balfour, A.	Diamond, John	Hughes, Emrys (S. Ayrshire)
Bence, C. R. (Dunbartonshire, E.)	Dodds, N. N.	Hunter, A. E.
Benn, Hn. Wedgwood (Bristol, S.E.)	Donnelly, D. L.	Hynd, H. (Accrington)
Benson, G.	Dugdale, Rt. Hn. John (W. Brmwch)	Hynd, J. B. (Attercliffe)
Beswick, Frank	Dye, S.	Irvine, A. J. (Edge Hill)
Blackburn, F.	Ede, Rt. Hon. J. C.	Irving, Sydney (Dartford)
Blenkinsop, A.	Edelman, M.	Isaacs, Rt. Hon. G. A.
Blyton, W. R.	Edwards, Rt. Hon. John (Brighouse)	Janner, B.
Boardman, H.	Edwards, Rt. Hon. Nees (Caerphilly)	Jay, Rt. Hon. D. P. T.
Bottomley, Rt. Hon. A. G.	Edwards, Robert (Bilston)	Jeger, George (Goole)
Bowden, H. W. (Leicester, S.W)	Edwards, W. J. (Stepney)	Jeger, Mrs. Lena (Holbn & St. Pncs, S.)
Bowen, E. R. (Cardigan)	Evans, Albert (Islington, S.W.)	Jenkins, Roy (Stechford)
Bowles, F. G.	Evans, Edward (Lowestoft)	Johnson, James (Rugby)
Boyd, T. C.	Fernyhough, E.	Johnston, Douglas (Paisley)
Braddock, Mrs. Elizabeth	Fienburgh, W.	Jones, Rt. Hon. A. Creech (Wakefield)
Brockway, A. F.	Finch, H. J.	Jones, David (The Hartlepools)
Broughton, Dr. A. D. D.	Fletcher, Eric	Jones, Elwyn (W. Ham, S.)
Brown, Rt. Hon. George (Belper)	Foot, D. M.	Jones, Jack (Rotherham)
Brown, Thomas (Ince)	Fraser, Thomas (Hamilton)	Jones, T. W. (Merioneth)
Burke, W. A.	George, Lady Megan Lloyd (Car'then)	Kenyon, C.
Burton, Miss F. E.	Gibson, C. W.	Key, Rt. Hon. C. W.
Butler, Herbert (Hackney, C.)	Gooch, E. C.	King, Dr. H. M.
Butler, Mrs. Joyce (Wood Green)	Greenwood, Anthony	Kirk, P. M.
Callaghan, L. J.	Grey, C. F.	Lawson, G. M.
Castle, Mrs. B. A.	Griffiths, David (Rother Valley)	Ledger, R. J.
Champion, A. J.	Griffiths, Rt. Hon. James (Llanelly)	Lee, Frederick (Newton)
Chapman, W. D.	Griffiths, William (Exchange)	Lee, Miss Jennie (Cannock)
Clunie, J.	Hall, Rt. Hn. Glenvil (Colne Valley)	Lever, Leslie (Ardwick)
Coldrick, W.	Hamilton, W. W.	Lewis, Arthur
Collick, P. H. (Birkenhead)	Hannan, W.	Lindgren, G. S.
Collins, V. J. (Shoreditch & Finsbury)	Harrison, J. (Nottingham, N.)	Lipton, Marcus
Corbet, Mrs. Freda	Hastings, S.	Logan, D. G.
Cove, W. G.	Hayman, F. H.	MacColl, J. E.
Craddock, George (Bradford, S.)	Healey, Denis	MacDermot, Niall
Cronin, J. D.	Henderson, Rt. Hn. A. (Rwly Regis)	McGhee, H. G.
Crossman, R. H. S.	Herbison, Miss M.	McGovern, J.
Cullen, Mrs. A.	Hewitson, Capt. M.	McInnes, J.
McKay, John (Wallsend)	Paton, John	Stross, Dr. Barnet (Stoke-on-Trent, C.)
McLeavy, Frank	Peart, T. F.	Summerskill, Rt. Hon. E.
MacMillan, M. K. (Western Isles)	Plummer, Sir Leslie	Swingler, S. T.
MacPherson, Malcolm (Stirling)	Popplewell, E.	Sylvester, G. O.
Mahon, Simon	Prentice, R. E.	Taylor, Bernard (Mansfield)
Mallalieu E. L. (Brigg)	Price, J. T. (Westhoughton)	Taylor, John (West Lothian)
Mallalieu, J. P. W. (Huddersfd, E.)	Probert, A. R.	Thomas, George (Cardiff)
Mann, Mrs. Jean	Proctor, W. T.	Thomas, Iorwerth (Rhondda, W.)
Marquand, Rt. Hon. H. A.	Pryde, D. J.	Thornton, E.
Mason, Roy	Pursey, Cmdr. H.	Tomney, F.
Mayhew, C. P.	Randall, H. E.	Ungoed-Thomas, sir Lynn
Mellish, R. J.	Rankin, John	Usborne, H. C.
Messer, Sir F.	Redhead, E. C.	Viant, S. P.
Mikardo, Ian	Reeves, J.	Wade, D. W.
Mitchison, G. R.	Reid, William	Warbey, W. N.
Moody, A. S.	Rhodes, H.	Watkins, T. E.
Morris, Percy (Swansea, W.)	Robens, Rt. Hon. A.	Weitzman, D.
Morrison, Rt. Hn. Herbert (Lewis'm, S.)	Roberts, Albert (Normanton)	Wells, William (Walsall, N.)
Mort, D. L.	Roberts, Goronwy (Caernarvon)	West, D. G.
Moss, R.	Robinson, Kenneth (St. Pancras, N.)	Wheeldon, W. E.
Moyle, A.	Rogers, George (Kensington, N.)	White, Mrs. Eirene (E. Flint)
Mulley, F. W.	Ross, William	White, Henry (Derbyshire, N.E.)
Neal, Harold (Bolsover)	Royle, C.	Wigg, George
Noel-Baker, Francis (Swindon)	Shinwell, Rt. Hon. E.	Wilcock, Group Capt. C. A. B.
Noel-Baker, Rt. Hon. P. (Derby, S.)	Short, E. W.	Wilkins, W. A.
O'Brien, Sir Thomas	Shurmer, P. L. E.	Willey, Frederick
Oliver, G. H.	Silverman, Julius (Aston)	Williams, Rev. Llwelyn (Ab'tillery)
Oram, A. E.	Silverman, Sydney (Nelson)	Williams, Ronald (Wigan)
Orbach, M.	Skeffington, A. M.	Williams, W. R. (Openshaw)
Oswald, T.	Slater, Mrs. H. (Stoke, N.)	Willis, Eustace (Edinburgh, E.)
Owen, W. J.	Slater, J. (Sedgefield)	Wilson, Rt. Hon. Harold (Huyton)
Padley, W. E.	Smith Ellis (Stoke, S.)	Winterbottom, Richard
Paget, R. T.	Snow, J. W.	Woodburn, Rt. Hon. A.
Paling, Rt. Hon. W. (Dearne Valley)	Soskice, Rt. Hon. Sir Frank	Woof, R. E.
Paling, Will T. (Dewsbury)	Sparks, J. A.	Yates, W. (Ladywood)
Palmer, A. M. F.	Steele, T.	Younger, Rt. Hon. K.
Pannell, Charles (Leeds, W.)	Stewart, Michael (Fulham)	Zilliacus, K.
Pargiter, G. A.	Stonehouse, John
Parker, J.	Stones, W. (Consett)	TELLERS FOR THE AYES:
Parkin, B. T.	Strauss, Rt. Hon. George (Vauxhall)	Mr. Pearson and Simmons.
NOES
Agnew, Sir Peter	Butler, Rt. Hn. R. A. (Saffron Walden)	Fraser, Hon. Hugh (Stone)
Aitken, W. T.	Campbell, Sir David	Fraser, Sir Ian (M'cmbe & Lonsdale)
Allen, R. A. (Paddington, S.)	Carr, Robert	Freeth, Denzil
Alport, C. J. M.	Channon, Sir Henry	Galbraith, Hon. T. G. D.
Amery, Julian (Preston, N.)	Chichester-Clark, R.	Gammans, Lady
Anstruther-Gray, Major Sir William	Churchill, Rt. Hon. Sir Winston	Garner-Evans, E. H.
Ashton, H.	Clarke, Brig. Terence (Portsmth, W.)	George, J. C. (Pollok)
Astor, Hon. J. J.	Cole, Norman	Gibson-Watt, D.
Atkins, H. E.	Conant, Maj. Sir Roger	Glover, D.
Baldock, Lt.-Cmdr. J. M.	Cooke, Robert	Glyn, Col. R.
Baldwin, A. E.	Cooper, A. E.	Godber, J. B.
Balniel, Lord	Cooper-Key, E. M.	Gomme-Duncan, Col. Sir Alan
Barber, Anthony	Cordeaux, Lt.-Col. J. K.	Goodhart, Philip
Barlow, Sir John	Corfield, Capt. F. V.	Gough, C. F. H.
Barter, John	Craddock, Beresford (Spelthorne)	Gower, H. R.
Baxter, Sir Beverley	Crosthwaite-Eyre, Col. O. E.	Graham, Sir Fergus
Bell, Philip (Bolton, E.)	Crowder, Petre (Ruislip—Northwood)	Grant, W. (Woodside)
Bell, Ronald (Bucks, S.)	Currie, G. B. H.	Grant-Ferris, Wg Cdr. R. (Nantwich)
Bennett, F. M. (Torquay)	Dance, J. C. G.	Green, A.
Bennett, Dr. Reginald	Davidson, Viscountess	Gresham Cooke, R.
Bevins, J. R. (Toxteth)	D'Avigdor-Goldsmid, Sir Henry	Grimston, Hon. John (St. Albans)
Bidgood, J. C.	Deedes, W. F.	Grimston, Sir Robert (Westbury)
Biggs-Davidson, J. A.	Digby, Simon Wingfield	Grosvenor, Lt.-Col. R. C.
Bingham, R. M.	Dodds-Parker, A. D.	Gurdon, Harold
Birch, Rt. Hon. Nigel	Donaldson, Cmdr. C. E. McA.	Hall, John (Wycombe)
Bishop, F. P.	Doughty, C. J. A.	Hare, Rt. Hon. J. H.
Black, C. W.	Drayson, G. B.	Harris, Frederic (Croydon, N.W.)
Body, R. F.	du Cann, E. D. L.	Harris, Reader (Heston)
Boothby, Sir Robert	Duncan, Sir James	Harrison, A. B. C. (Maldon)
Bossom, Sir Alfred	Duthie, W. S.	Harrison, Col. J. H. (Eye)
Boyd-Carpenter, Rt. Hon. J. A.	Eccles, Rt. Hon. Sir David	Harvey, Sir Arthur (Macclesfd)
Boyle, Sir Edward	Elliott, R. W. (N'castle upon Tyne, N.)	Harvey, Ian (Harrow, E.)
Braine, B. R.	Emmet, Hon. Mrs. Evelyn	Harvey, John (Walthamstow, E.)
Braithwaite, Sir Albert (Harrow, W.)	Errington, Sir Eric	Harvie-Watt, Sir George
Bromley-Davenport, Lt.-Col. W. H.	Erroll, F. J.	Hay, John
Brooke, Rt. Hon. Henry	Farey-Jones, F. W.	Head, Rt. Hon. A. H.
Brooman-White, R. C.	Finlay, Graeme	Heath, Rt. Hon. E. R. G.
Browne, J. Nixon (Craigton)	Fisher, Nigel	Henderson, John (Cathcart)
Bryan, P.	Fletcher-Cooke, C.	Henderson-Stewart, Sir James
Bullus, Wing Commander E. E.	Forrest, G.	Hesketh, R. F.
Burden, F. F. A.	Fort, R.	Hicks-Beach, Maj. W. W.
Butcher, Sir Herbert	Foster, John	Hill, Rt. Hon Charles (Luton)

Hill, Mrs. E. (Wythenshawe)	McAdden, S. J.	Ridsdale, J. E.
Hill, John (S. Norfolk)	Macdonald, Sir Peter	Rippon, A. G. F.
Hinchingbrooke, Viscount	Mackeson, Brig. Sir Harry	Robertson, Sir David
Hirst, Geoffrey	McKibbin, A. J.	Robson Brown, Sir William
Hobson, John (Warwick & Leam'gt'n)	Mackie, J. H. (Galloway)	Roper, Sir Harold
Holland-Martin, C. J.	McLaughlin, Mrs. P.	Ropner, Col. Sir Leonard
Hope, Lord John	Maclay, Rt. Hon. John	Russell, R. S.
Hornby, R. P.	Maclean, Sir Fitzroy (Lancaster)	Sandys, Rt. Hon. D.
Hornsby-Smith, Miss M. P.	McLean, Neil (Inverness)	Scott-Miller, Cmdr. R.
Horobin, Sir Ian	Macleod, Rt. Hn. Iain (Enfield, W.)	Sharples, R. C.
Horsbrugh, Rt. Hon. Dame Florence	MacLeod, John (Ross & Cromarty)	Shepherd, William
Howard, Gerald (Cambridgeshire)	Macmillan, Maurice (Halifax)	Simon, J. E. S. (Middlesbrough, W.)
Howard, Hon. Greville (St. Ives)	Macpherson, Niall (Dumfries)	Smyth, Brig. Sir John (Norwood)
Howard, John (Test)	Maddan, Martin	Soames, Christopher
Hughes Hallett, Vice-Admiral J.	Maitland, Cdr. J. F. W. (Horncastle)	Spearman, Sir Alexander
Hughes-Young, M. H. C.	Maitland, Hon. Patrick (Lanark)	Speir, R. M.
Hulbert, Sir Norman	Manningham-Buller, Rt. Hn. Sir R.	Spence, H. R. (Aberdeen, W.)
Hurd, A. R.	Markham, Major Sir Frank	Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)
Hutchison, Michael Clark (E'b'gh, S.)	Marlowe, A. A H.	Stanley, Capt. Hon. Richard
Hutchison, Sir Ian Clark (E'b'gh, W.)	Marples, Rt. Hon. A. E.	Stevens, Geoffrey
Hutchison, Sir James (Scotstoun)	Marshall, Douglas	Steward, Harold (Stockport, S.)
Hyde, Montgomery	Mathew, R.	Steward, Sir William (Woolwich W.)
Hylton-Foster, Rt. Hon. Sir Harry	Maudling, Rt. Hon. R.	Stoddart-Scott, Col. Sir Malcolm
Iremonger, T. L.	Mawby, R. L.	Storey, S.
Irvine, Bryant Godman (Rye)	Maydon, Lt.-Comdr. S. L. C.	Stuart, Rt. Hon. James (Moray)
Jenkins, Robert (Dulwich)	Medlicott, Sir Frank	Studholme, Sir Henry
Jennings, Sir Roland (Hallam)	Milligan, Rt. Hon. W. R.	Summers, Sir Spencer
Johnson, Dr. Donald (Carlisle)	Molson, Rt. Hon. Hugh	Sumner, W. D. M. (Orpington)
Johnson, Eric (Blackley)	Moore, Sir Thomas	Taylor, Sir Charles (Eastbourne)
Johnson, Howard (Kemptown)	Morrison, John (Salisbury)	Taylor, William (Bradford, N.)
Jones, Rt. Hon. Aubrey (Hall Green)	Mott-Radclyffe, Sir Charles	Teeling, W.
Joseph, Sir Keith	Nabarro, G. D. N.	Temple, John M.
Joynson-Hicks, Hon. sir Lancelot	Neave, Airey	Thomas, Leslie (Canterbury)
Kaberry, D.	Nicholls, Harmar	Thomas, P. J. M. (Conway)
Keegan, D.	Nicholson, Godfrey (Farnham)	Thompson, Kenneth (Walton)
Kerby, Capt. H. B.	Nicolson, N. (B'n'm'th, E. & Chr'ch)	Thompson, Lt.-Cdr. R. (Croydon, S.)
Kerr, Sir Hamilton	Nugent, G. R. H.	Thorneycroft, Rt. Hon. P.
Kershaw, J. A.	Ormsby-Gore, Rt. Hon. W. D.	Thornton-Kemsley, C. N.
Kimball, M.	Orr, Capt. L. P. S.	Tiley, A. (Bradford, W.)
Kirk, P. M.	Orr-Ewing, Charles Ian (Hendon, N.)	Tilney, John (Wavertree)
Lagden, G. W.	Orr-Ewing, Sir Ian (Weston-S-Mare)	Turton, Rt. Hon. R. H.
Lambert, Hon. G.	Osborne, C.	Tweedsmuir, Lady
Lambton, Viscount	Pannell, N. A. (Kirkdale)	Vane, W. M. F.
Lancaster, Col. C. C.	Partridge, E.	Vaughan Morgan, J. K.
Langford-Holt, J. A.	Peel, W. J.	Vickers, Miss Joan
Leather, E. H. C.	Peyton, J. W. W.	Vosper, R. Hon. D. F.
Leavey, J. A.	Pickthorn, K. W. M.	Wakefield, Sir Wavell (St. M'lebone)
Leburn, W. G.	Pike, Miss Mervyn	Walker-Smith, Rt. Hon. Derek
Legge-Bourke, Maj. E. A. H.	Pilkington, Capt. R. A.	Wall, Major Patrick
Legh, Hon. Peter (Petersfield)	Pitman, I. J.	Ward, Rt. Hon. G. R. (Worcester)
Lennox-Boyd, Rt. Hon. A. T.	Pitt, Miss E. M.	Watkinson, Rt. Hon. Harold
Lindsay, Hon. James (Devon, N.)	Pott, H. P.	Webbe, Sir H.
Lindsay, Martin (Solihull)	Powell, J. Enoch	Whitelaw, W. S. I.
Linstead, Sir H. N.	Price, David (Eastleigh)	Williams, Paul (Sunderland, S.)
Llewellyn, D. T.	Price, Henry (Lewisham, W.)	Williams, R. Dudley (Exeter)
Lloyd, Rt. Hon. G. (Sutton Coldfield)	Prior-Palmer, Brig. O. L.	Wood, Hon. R.
Lloyd, Maj. Sir Guy (Renfrew, E.)	Profumo, J. D.	Woollam, John Victor
Lloyd, Rt. Hon. Selwyn (Wirral)	Rawlinson, Peter	Yates, William (The Wrekin)
Low, Rt. Hon. A. R. W.	Redmayne, M
Lucas, Sir Jocelyn (Portsmouth, S.)	Rees-Davies, W. R.	TELLERS FOR THE NOES:
Lucas, P. B. (Brentford & Chiswick)	Remnant, Hon. P.	Mr. Oakshott and Mr. Wills.
Lucas-Tooth, Sir Hugh	Renton, D. L. M.
Bill committed to a Standing Committee pursuant to Standing Order No. 38 (Committal of Bills).