DEBATE ON THE ADDRESS

HC Deb 10 November 1965 vol 720 cc166-310

[SECOND DAY]

Order read for resuming adjourned debate on Question [9th November]: That an humble Address be presented to Her Majesty, as follows: Most Gracious Sovereign, We Your Majesty's most dutiful and loyal subjects, the Commons of the United Kingdom of Great Britain and Northern Ireland, in Parliament assembled, beg leave to offer our humble thanks to Your Majesty for the Gracious Speech which Your Majesty has addressed to both Houses of Parliament.

Question again proposed.

Mr. Speaker

I understand that the general feeling of the House is that we should continue today the general debate and that on Thursday we should debate largely the Land Commission and housing, on Friday foreign affairs and defence, on Monday transport and technology, and on Tuesday economic affairs.

2.50 p.m.

Mr. Raymond Gower (Barry)

I trust that the House will appreciate that I am in a somewhat embarrassing position and will bear with me for a short period. After waiting throughout most of yesterday's debate I had the fortune to catch your eye, Mr. Speaker, seven minutes before the Adjournment, when my few remarks were rudely terminated. Many aspects of our proceedings are designed for the convenience of the Front Benches, but I am advised that it is traditional during the debate on the Address for a back bencher interrupted by the previous night's Adjournment to be allowed to continue next day, and as back benchers we should not lightly sacrifice that right. I promise to be brief.

Last night, in my last sentence, I stated that I welcomed the proposed changes in the leasehold law. Not to do so at this stage would make nonsense of all that I have ever said or written on this topic. I do not know to what extent leasehold constitutes a special problem in parts of England, but I have always contended that its very incidence and extent have made leasehold a very special problem in parts of South Wales.

I do not know what formula the Government are adopting or what formula they will decide to adopt, but I hope that it will be fair and reasonable. I plead with Ministers to include within the scope of this Bill those leasehold properties, leasehold houses of which the freeholds are owned by local authorities and by other public bodies. There are many such houses in South Wales. In my own constituency of Barry, the Glamorgan County Council is a considerable freehold owner of leasehold houses. In some respects the leasehold owners of these houses are in a worse position than the leaseholders of private freehold property. For while some private landlords ask high or even excessive prices for the freeholds, Glamorgan County Council usually refuses to sell at all. It is no solution to a person with about 20 years unexpired leasehold to be assured that the county council will not deal harshly with him on the expiry of the lease. He wants something better than 20 years unexpired leasehold, otherwise no mortgage can be obtained on his house. Likewise I understand that the Swansea Borough Council is a major owner of freehold properties in that town. In parts of Cardiff and Barry many of these houses have British Railways as their freehold owners. I understand that in some parts of the industrial valleys in South Wales the freeholds are owned by the National Coal Board. If this Measure is to be fair and just, its effect should extend to all such houses where the freeholds are owned by local authorities, or by public bodies.

I recall that in a Private Member's Bill introduced about two years ago by the hon. Member for Birmingham, Small Heath (Mr. Denis Howell), the present Chancellor of the Exchequer intervened to say that in his view a case had been made out for the inclusion of these houses owned by public authorities. I hope that the right hon. Gentlemen the Chancellor of the Exchequer and the Secretary of State for Wales have exerted themselves to influence the Cabinet to include these properties in the Bill. If such properties are omitted it is a sure sign that the Secretary of State for Wales has failed in this important respect.

Yesterday, many Scottish Members bewailed the fact that the references in the Speech to Scotland were limited to one short paragraph of two lines at the end of the Speech. In this respect, at any rate, Scotland was one paragraph and two lines better off than Wales which, despite the appointment of a Secretary of State, had no separate reference at all. As my right hon. Friend the Leader of the Opposition pointed out yesterday, the proposals of the Gracious Speech are inadequate to deal with the deep-seated problems and difficulties of the economy of this country in these postwar years. Apart from a few admittedly useful and electorally attractive measures of social reform, the proposals are not designed to make the people of this country appreciate the need for ever-increased efficiency and change.

The Prime Minister may seem like a conjurer. He can offer remedies which are painless and even pleasant. Change and progress and an increase of efficiency are not always painless; they are not always pleasant.

2.55 p.m.

The Chancellor of the Duchy of Lancaster (Mr. Douglas Houghton)

The hon. Gentleman the Member for Barry (Mr. Gower) can appeal to my right hon. Friend the Prime Minister on leasehold reform with a much better prospect of success than he could ever have appealed to his right hon. Friend when he was a member of the Government. We are very anxious to have his warm-hearted approval of the Measures which will, in due course, be brought before the House.

The biggest lie on the hoardings at the present time is the one which says," Labour breaks promises". The worst that can be said by anyone, including a somewhat brazen Opposition, is that we have not fulfilled all of our promises at once, notwithstanding a crowded first Session and a very full one ahead. We may admittedly have to have a slight overspill into a third Session. I suppose that the complaint is that the Government have not managed to cram five years' work into two or three years. The spectacle of 13 years of Tory rule chiding a Labour Government for not doing everything in the first Session, or even in the first two or three, is surely one of Satan rebuking Sin.

Thirteen years of Tory rule was surely enough. We had 13 years of Government, including the grievous and expensive Suez venture, one "stop-go" after another, and a thumping balance of payments problem to finish with. Surely enough was enough. The remnants of the former Government, now on the Opposition benches, are in no condition to lecture us. As to the comments of the right hon. Gentleman the Leader of the Opposition yesterday to my right hon. Friend the Prime Minister, about the composition of his Cabinet, it came ill from a survivor of the" Night of the long knives". In July, 1963, the right hon. Gentleman will remember that Mr. Macmillan tried to rejuvenate his Government by sacking half of his Cabinet, all of whom were younger than himself. Surely we on this side of the House do not have to read the Prorogation speech again in order to put the dishonest poster to scorn. Nor do I need to read the Queen's Speech again to convince the House how foolish the slogans of the Opposition will look by this time next year.

What is nagging the Leader of the Opposition is that this Government are too popular— as the noble Marquess of Salisbury would put it," Too popular by half"— for the peace of mind of the right hon. Gentleman. He can find no firm ground for constructive criticism, so yesterday he had to fall back on being a party political pea-shooter. The Leader of the Opposition is not an alternative Prime Minister so much as a candidate for the next Command Performance. His speeches in the country sound like the Fourth Form at St. Dominic's, and those in the House like a man with nothing to say. I thought that the right hon. Gentleman's speech yesterday was a complete write-off. I am sorry that he is not here this afternoon. I dislike being rude to him in his absence but I fully expected that the Leader of the Opposition would be in his place for the opening of the debate.[Interruption.] I hear that the Leader of the Opposition has a perfectly good reason for being absent and I apologise for any reflection I might have made upon him. It is a pity that I was not passed a note earlier, and I could have moderated some of my remarks.

I listened to his speech yesterday, and read it again this morning, and I say, quite frankly, that the country is in no mood for that sort of stuff. At this hour of deep anxiety especially, the country is looking for what it is now getting, above all, from a Labour Government, namely, integrity and courage. Whatever we are doing and whatever we do not do, we are at least honest about it. After 13 years of slipshod and equivocal government, that of itself is a welcome change.

I will deal particularly with a fairly wide range of social services. I think that I shall satisfy the House that our record is good, that our promises are sound and will be fulfilled and that we have some very useful work in progress. The social services are a pretty large sector on the home front. We started last year with some heavy commitments on benefits and the relief of poverty. The House may recall the words of the Gracious Speech a year ago on this subject: My Government will have particular regard for those on whom age, sickness and personal misfortune impose special disabilities. They believe that radical changes in the national schemes of social security are essential to bring them into line with modern needs. They will therefore embark at once upon a major review of these schemes. Meanwhile, they will immediately introduce legislation to increase existing rates of National Insurance and associated benefits. Action will be proposed to modernise and develop the health and welfare services. Steps will be taken to increase the number of doctors and other trained staff in the National Health Service. Prescription charges for medicines will be abolished Every bit of that can look the Opposition squarely in the face this afternoon.

By the end of March this year—within four months—we had brought a little more money and a little more happiness to about 8½ million people on benefits, pensions and assistance. Some of the higher benefits were payable before last Christmas; the House will recall the £6 million that my right hon. Friend the Minister of Pensions and National Insurance was able to distribute in fuel and comforts grants to well over 1 million aged and chronic sick people on National Assistance. These improvements were better than anything they had ever had at one time since the scheme began — 12s. 6d. a week for a single person and 21s. for a married couple, at an extra cost of what? The extra cost this full year of National Insurance and injury benefits alone will be £ 285 million. Corresponding increases to war pensioners costing £ 15 million and improved National Assistance of £ 25 million bring the grand total to £325 million extra this full year.

We remedied a grievance of long standing— the 10s. widow— which right hon. and hon. Members opposite persistently declined to remedy. We abolished the earnings rule for widows which right hon. and hon. Members opposite frequently refused to remove. Prescription charges for medicines under the Health Services went as well. This is all as we said. We were criticised by some of our friends overseas for having done too much. But we did it in the cause of humanity, admittedly, perhaps, at some risk to the economy. But if that was one of our major mistakes, then this alert, aggressive and death-dealing Opposition kept very quiet about it.

Dr. Wyndham Davies (Birmingham, Perry Bar)

rose—

Mr. Houghton

No.

By the end of December last year, two months after we took office, the necessary legislation had been passed by this House and other necessary action had been taken by my right hon. Friends the Ministers of Pensions and National Insurance and Health to give effect to this opening broadside in our strategy on the social services. I would say in passing that the appreciation of the beneficiaries can still be heard eight months afterwards more loudly than the approval of right hon. and hon. Members opposite.

Then we set about work on the longer-term reforms upon which we had set our hearts for a long time before we came to office. I will deal first with five matters which are referred to in the Gracious Speech: short-term wage-related benefits; workmen's compensation; public service pensions increases; doctors' pay and improvements in doctors' services and the hospital programme; and improved services for the family.

Dr. Wyndham Davies

rose—

Mr. Houghton

I have hardly begun. There is a lot more of this. If the House will bear with me I will refer to the work in progress.

Dr. Wyndham Davies

Would the right hon. Gentleman give way?

Mr. Speaker

Order. If a Member clearly indicates that he does not wish to give way, merely getting up again and again will not make him do so.

Mr. Houghton

I apologise for not giving way, but I have a lot of information to give to the House, and I wish to be free for a little longer to give it.

First, I want to say something about the earnings-related short-term benefits. In putting forward better provision for those who lose their jobs, the Government are implementing their decision to concentrate special attention on schemes to promote faster economic growth. Faster growth demands the most efficient use of labour and the mobility of labour in the light of economic and technological developments. If this is to be achieved, proper provision must be made for those who have to change their jobs and risk a period of transitional unemployment.

The first Measure to secure this was the Redundancy Payments Act, which will be brought into operation by my right hon. Friend the Minister of Labour next month. This, as the House well recalls, will provide a tax-free lump sum for workers whose jobs disappear and will apply whether or not a worker is subsequently unemployed. The improvements mentioned in the Gracious Speech for earnings-related supplements to unemployment benefit for the early months of unemployment will be the second strand of our policy for encouraging the economic use of labour. The National Insurance benefits for unemployment, however, have been very closely linked with those for sickness and industrial injury benefits in the past.

We have decided that our concept of a revised structure of short-term benefits should include sickness benefits and industrial injury benefits as well as unemployment. There are many social and administrative problems which are very difficult to overcome if one attempts to separate unemployment from sickness benefit. Workers who begin by being sick and then become unemployed, or the other way round, may wish to switch from one classification to another in order to get the advantage of the higher benefit. Therefore, sickness benefits will be included in the proposals which will be introduced by my right hon. Friend as soon as possible. There will be corresponding adjustments in the industrial injury benefit.

We also thought that we should take this opportunity of improving the widows' allowances in the early period of their widowhood, immediately after bereavement. I am sure that the House welcomes this, especially if we can give the widow more and give it to her for a longer period immediately after her sorrow.

The details of all these proposals will be included in the Bill. We want to get the Bill passed as soon as we can in this Session so that, if approved by Parliament in time, the necessary arrangements can be completed to introduce the scheme in the autumn of next year. It can, however, be said now that it is the intention that the supplements to unemployment and sickness benefits will be payable after a short waiting period for the early periods of unemployment and sickness and will be related to a person's earnings as assessed under Pay-As-You-Earn. The supplements to widows will be related to their husband's earnings. These changes are regarded by the Government as an important and essential first step pending the completion of our major review.

Another Measure which will be introduced by my right hon. Friend the Minister of Pensions and National Insurance will be very welcome in many quarters of the House, especially among some of my hon. Friends on the Government benches. I refer to the Workmen's Compensation and Benefit (Amendment) Bill, which will deal with an intractable problem, which the right hon. Member for Bridlington (Mr. Wood) will well remember, of old pre-1948 workmen's compensation cases which it was not found possible then or since fully to assimilate into the industrial injuries scheme.

Those "old cases", as they are called, have been exercising the attention of successive Ministers since 1948. Today, my right hon. Friend has introduced a Bill to simplify and improve the allowances now available and also to extend their scope so as roughly to double the number of workmen's compensation cases who are entitled to them. I am sure that my hon. Friends who represent constituencies especially concerned with this problem will study the Bill with great interest and, I feel certain, with satisfaction.

I now come to something which gives me very great pleasure indeed to announce, and that is the Bill which my right hon. Friend the Chancellor of the Exchequer is introducing, and which has been presented this afternoon, to improve the pensions of public service pensioners. Although I must be careful not to bring you into our discussion, Mr. Speaker, I think that I detect a twinkle in your eye. This is something for which you, Mr. Speaker, and right hon. and hon. Members, on both sides, have been pressing for a long time.

The Bill provides pensions inceases rising to 16 per cent, for the oldest pensioners, the highest general rate of percentage increase ever included in a Pensions (Increase) Bill. The maximum of 16 per cent. will apply to pensions awarded not later than 1st April, 1957, and it will be scaled downwards to 2 per cent. for pensions awarded by 1st April, 1964.

Right hon. and hon. Members may have noticed that we have not included in these proposals the special bonus for the over-70s which was included in the last Pensions (Increase) Act. We felt that our method of improving the graduated scale of benefit was fair and would give higher pensions to those who have drawn their pensions longest than by giving an extra bounty to those who have reached a certain age without special reference to the length of time they have been retired.

Another thing which I am very joyful to notice is that another problem which under the previous Administration was intractable and insoluble has been solved by the present Administration. What is there about this Government that they can solve the insoluble problems of the previous Government? Surely, in all modesty, one is entitled to refer to this. I spoke for hours on this problem in successive Pensions (Increase) Bill debates. It was the problem of how to deal with the pensions increase of a man who formally retired, became disestablished, accepted a lower grade in a disestablished capacity and then ultimately retired from the lower grade. The complexities of fixing his pension increase without unfairness to others has, in the past, baffled the Ministers concerned. Our proposals will be in the Bill and hon. Members will be able to see how satisfactorily we have disposed of this matter.

I simply conclude on this matter by saying that together with corresponding measures under the Royal Warrant, this Bill will bring well-deserved relief to 710,000 public service pensioners, concentrating help where it is most needed—that is, on the pensions awarded longest ago.

I come to No. 4 in the matters referred to in the Gracious Speech. It concerns the general practice Bill and the negotiations with the doctors. The House is aware that my right hon. Friend the Minister of Health has been engaged for some months in discussing with general practitioner representatives the proposals in the family doctor's charter for new conditions of service and new methods of remuneration. Some of the proposals in the charter would require legislation. In particular, the Government have undertaken to introduce legislation to establish a finance corporation to help family doctors with the provision of premises. While negotiations are not yet complete, all right hon. and hon. Members will have been glad to see that the profession has now agreed upon a new system of remuneration, which is to go to the Review Body for pricing. We can all now hope that when the rest of the negotiations have been completed and the Review Body has carried out its task, the way will be open for a transformed and revitalised family doctor service.

In the absence of my right hon. Friend the Minister of Health, who unavoidably cannot be present, it is only suitable and appropriate that I should congratulate him on the skill, the patience and the success with which he accomplished those difficult negotiations. It fell to me to be close to my right hon. Friend during this period and I am sure that the whole House is relieved that the negotiations have proceeded to this point of agreement and that we are unlikely now to be confronted with any serious unrest and difficulty in the National Health Service.

Dr. Wyndham Davies

Will the right hon. Gentleman now give way?

Mr. Houghton

Certainly, he will.

Dr. Wyndham Davies

I am grateful to the right hon. Gentleman. I merely wanted to draw attention to the fact that he has mentioned that the Government would increase the number of doc- tors. Can he amplify that and say what measures the Government intend to take to increase the number of doctors to keep the National Health Service going?

Mr. Houghton

One measure is to get improved conditions for doctors, which might help to stop a certain amount of export in professional skill and experience; and other measures are being taken. Part of the difficulty about the supply of doctors is that grievous mistakes were made by the previous Administration in estimating the numbers of doctors required and in cutting down the number of places for medical students.

I now pass to health, welfare and the hospital programme. The National Plan shows that expenditure on the country's health and welfare services is expected to rise by nearly 25 per cent. by the end of the 1960s. The continuing development of the hospital services is a major part of this expansion. We have already demonstrated our anxiety to stimulate hospital building by exempting it completely, together with housing and schools, from the measures recently taken by my right hon. Friend the Chancellor of the Exchequer to strengthen our economic position.

The programme of hospital modernisation is fast gathering momentum— [An hon. Member: "What?"]— and this year we shall be spending nearly £ 70 million on hospital building. In a very few years' time, the figure will be half as much again.

Sir Douglas Glover (Ormskirk)

What about St. Thomas'?

Mr. Houghton

There seems to be a certain amount of discomfort on the benches opposite. The material content of the programme and its particular emphasis and priorities need periodically to be reviewed to ensure that it stays in line with current concepts. At the request of my right hon. Friend, a comprehensive and realistic review is currently being undertaken by hospital boards and in the course of the next few months he will be considering the outcome of this review.

Special attention is being paid to the early improvement of facilities for the mentally ill and the mentally subnormal and the elderly sick. My right hon. Friend has particularly asked hospital boards to ensure that their plans are drawn up in consultation with the local health and welfare authorities, and those authorities are themselves substantially expanding their services. This is because we all recognise that it is better to provide care and treatment in the community for all those who do not require special types of care which can be given only in a hospital.

The current expenditure on local health services is expected to be rising by 6½ per cent. a year in real terms by the year 1969–70 compared with 5½ per cent. in recent years; and the figure for local welfare services is even more encouraging, 7½ per cent. last year. The most rapid expansion is in mental health. The current expenditure in 1969– 70 is likely to be at least double that of 1964– 65. My right hon. Friend will shortly be considering revised detailed forecasts by local authorities which, because they are flexible, will reflect the latest assessments of the changing needs in their areas.

I now pass to the last of the matters mentioned in the Gracious Speech, improved services for the family. Hon. and right hon. Gentlemen will have seen the White Paper, Cmd. 2742, in which there is a set of proposals relating to the child, the family and the young offender. My special responsibility for part of that White Paper related to Chapter II, "Family Support". In paragraph 7 there was a reference to the Government's desire to strengthen the organisation of a family service at local authority level. Although I prepared quite comprehensive proposals for a family service, at that time we felt that, none the less, it was desirable to have the widest consultation with those who would be directly concerned with its administration and have views upon it, and other social workers, before we finally made up our mind. So the Government are to appoint a small, independent committee to review the organisation and responsibilities of the local authority personal social services and consider what changes are desirable to ensure an effective family service. That independent committee is about to be set up.

In passing, I refer to the recruitment and training of the social workers, because the comprehensive proposals in the White Paper and the expansion of the local services generally will require more qualified social workers as the years go by. I have just had completed an up-to-date study of the probable needs during the next few years, and the several Ministers concerned are taking the necessary action to see that plans for an expanded service are not frustrated by lack of social workers.

After all this I ask the question, what have we not done? One thing we have not done, and it was a grievous disappointment to my hon. and right hon. Friends, and probably to hon. Members opposite, is to bring in plans for the income guarantee; and we have not been able, either, to abolish the remaining prescription charges.

The measures announced to the House by my right hon. Friend the Chancellor of the Exchequer on 27th July entailed some very painful decisions for all Ministers, but what mattered, from the point of view of the confidence of our friends overseas, was that we had the courage to make them, and the £ has got stronger ever since, and is now safe. In the announcement made by the Chancellor of the Exchequer—a statement, by the way, approved by the whole Government —much was postponed, but nothing was abandoned. Only the most pressing economic reasons persuaded us to bring forward a scheme for earnings-related short-term benefits this Session in advance of the general review. These improvements, which I have already referred to in broad outline, are estimated to cost just over £60 million in a full year.

Now, in the social services, our plain duty, and firm resolve, is to see that the price of economic recovery does not fall on the poorest in the land. We must make whatever adjustments are necessary in social priorities to see that this does not happen, and this can be done within the financial disciplines which we have imposed upon ourselves to keep our public expenditure within the ceiling set, and the Government are going into all that now.

Now I turn to work which is in progress. First I want to refer to two surveys. The first is the completion of the inquiry by the Ministry of Pensions and National Insurance into the circumstances of retired pensioners, a survey which was inaugurated by the right hon. Gentleman the Member for Bridlington in response to a debate initiated by my right hon. Friend the Member for Llanelly (Mr. James Griffiths). It was completed earlier this year.

Detailed inquiries were sent out to 10,500 pensioners; 9,000 were interviewed and gave detailed information about the amount and sources of their income, their capital resources and liabilities, as well as other background information. The response was great. I think the House will be grateful to those who submitted themselves to this interrogation in order to provide information on which sound policies could be based. We should also thank the officers of the Ministry who had this rather delicate task to undertake. We are always thanking my right hon. Friend. She is so full of good works that hardly a week passes but that something upon which we can congratulate her is done. This Session she is going to have quite a bundle of good things—

Sir D. Glover

Mother Christmas.

Mr. Houghton

— and we shall see the joy and the satisfaction on the faces of Members on the benches opposite. This information is now being processed, and we shall be bringing a report before the House in due course.

Another survey is on the unsettled, the homeless and rootless people, the homeless alcoholics, the crude spirit drinkers, discharged prisoners, the homeless mentally disturbed people, the social misfits and drifters. These are a terrible problem, a pathetic problem. I have interested myself personally very much in it. They are a scar on our social life. Various estimates have been made of the size of the problem. We do not know for certain. We want to find out more. One estimate has put the number of homeless single people at 90,000, but another at barely more than one-third of that.

Many suggestions have been made as to how we are to deal with them. I have asked the Departments concerned, the Ministry of Health, the Home Office, and the Ministry of Housing and Local Government, and the National Assistance Board, to consult the voluntary bodies concerned with this problem and, in consultation with them, to carry out a survey to find out as far as possible the number of people and all we can about them. This is being carried out on behalf of the Departments concerned and the voluntary organisations, by the staff of the National Assistance Board with the help of the officers of the voluntary bodies.

A survey is now being made of accommodation for people of that kind, and then, in the beginning of December, National Assistance Board officers and others will be carrying out a survey of the number, including those who sleep rough, to see how many are sleeping in and about wherever they can—[An HON. MEMBER: "In Parliament."]— and find out their needs. I should like to think that it is not a laughing matter. I have been to look at the problem for myself, and one comes away feeling very disturbed. In our so-called affluent society we should be able to do better than that.

I have established contact with numerous voluntary organisations working in that field and I have brought them together in conference. They have never been brought together before, and they have appointed a liaison committee which is keeping in close touch with me. I am glad to say that the chairman is the Rev. Austen Williams, the Vicar of St. Martin-in-the-Fields, who is a wise and experienced worker in these matters. I am very anxious that the voluntary bodies should work together, should consider where the gaps are and what the needs are, and see what we can do to help.

We must also acknowledge that in many cases voluntary bodies are able to bring to bear on that work a different slant from that of an official organisation. The help and friendship that they offer is often more acceptable to many who shun what they think is officialdom, and voluntary bodies can make different approaches to the varying features and causes of these social casualties.

I am also very interested in the problem of alcoholism. It is a growing menace in conditions of rising living standards and increasing tensions in social and working life. As the pace gets hotter, the temptations to ease the strain get stronger, and the end of it in some grievous cases is complete physical and moral breakdown. No one helps them by merely saying that they should never have got into that condition. It is a medical and social problem. Moral censure on the alcoholic may be no more justified than on the heavy cigarette smoker who develops lung cancer, or the company director who eats too much and walks too little and collapses at his desk.

In matters of health, many of us get what we deserve. Health education is the real remedy, but those of us who falter and fall must be treated as casualties and not left to a living death. Among alcoholics, the most tragic of all are the crude spirit drinkers who get right to the bottom. The Minister of Health and I, together with other Ministers, have received well-considered and weighty recommendations on the problem. The difficult job is to ensure that those who reach that low level have a reasonable chance of recovery and rehabilitation. We hope shortly to have more information about the numbers and conditions of such people, and then we shall look at them more closely.

Sir Keith Joseph (Leeds, North-East)

I may have missed something. Did the right hon. Gentleman say that he was going to present a report on these matters in due course, or did I misunderstand him?

Mr. Houghton

I have not promised to make a report. A report is being made to me, but I am sure that the information that comes to me will be of general interest, and I shall be very anxious that it should become well known.

Mr. James Tinn (Cleveland)

I should like my right hon. Friend to look at the appalling suicide rate, which amounts to something like two-thirds of the fatalities on our roads and which, for women, is higher than fatalities on the roads. Will he look into that factor?

Mr. Houghton

We shall study any aspect of the problem which is relevant.

That disposes of the two surveys that are in hand, and I now wish to refer to three studies that we are doing. One is on a subject which has fascinated me for a long time, and that is the relationship between what is sometimes called fiscal welfare and positive welfare; that is, child allowances for taxation purposes on the one hand, and family allowances on the other. The whole question of the future rate of family allowances is being considered as part of the Government's long-term review of the social services. We have in mind the need to contain the total level of public expenditure and must avoid breaking out of it, but the Government have noted a number of interesting studies of this that have been made and, although it is by no means a straightforward matter, we are very anxious to have a look at it.

Another study is on services for the elderly, the chronic sick and the handicapped. In progress now is a close review of the community care services for the elderly, the chronic sick and the handicapped. It is in three parts: health and welfare services for the elderly, housing for the elderly, and services for the chronic sick and handicapped.

It is a big problem, and there are some interesting figures that I have never seen before of the numbers involved. We have to bear in mind that in mid-1964 there were in the country 6¼ million people over 65, of whom 2¼ million were over 75. It is estimated that 94 per cent. of them were living in private households, but there were 175,000 sick in hospitals and private nursing homes, 105,000 in residential homes provided by local authorities, voluntary bodies or privately, and 95,000 in hotels, guest houses, and so forth.

There are some remarkable figures of the extent and scope of the existing services, inadequate though they are. Health advice in the home, through health visitors, for example, was given to 300,000 separate people. In the case of home helps, which as hon. Members know from personal experience in their constituencies, is an area of very great shortage, 300,000 were helped. We have to look now into adequacy. Another important question is the detection of welfare needs and, thirdly, whether any new services are required.

The detection of welfare needs is especially important both in regard to the information which local practitioners can provide and health visitors. Various ideas are being put forward for a comprehensive welfare visiting system. But it requires money and it requires staff. It is an extra burden on the social services. Do we want it badly enough to pay for it and to be willing to make sacrifices for it? That is the issue confronting the Britain of today. How high is it prepared to set its new social targets, or are we only willing to drift on giving the least that we can afford towards the improvement of life for others?

Finally, I come to the employment of the older worker, which is something else that I have been very keen on for a number of years. Within 10 years from now there will be 9 million men and women over the minimum ages for the National Insurance pension. Are we going to classify all those as old age pensioners, and worry only about their pensions and general welfare, or are we going to think of something wider and perhaps more specific.

The National Plan draws attention to the manpower position, and to the tendency in present circumstances, although it is probably caused by higher pensions and the extent of occupational pensions, for people who could probably stay on to give up work. The proportion of older workers in employment is in decline.

I read the other day that in a work orientated society those who are not at work are out of the stream of life and suffering some form of social depreciation. Dr. Snelgrove, of Luton, has recently published a report entitled, "Elderly Employed" containing some depressing conclusions about the high proportion of people who are unhappy, disillusioned and disconsolate in retirement or because they are not content or satisfied, or adjusted physically, mentally or spiritually to enforced retirement. One may criticise the small scope of that survey, but others have been undertaken, although a long time ago. Are we doing what we should to study this problem in the context of present conditions? The major studies of the past may be, to a large extent, out of date, and therefore I am hoping to set on foot a new study.

Do we know enough about this problem? What can be done to remove obstacles at present presented by employers' pension arrangements? Are we going to tackle decisively the enforced unemployment caused by age limits under occupational schemes of those who otherwise could remain at work and continue a useful life? All this is of great interest to the Government, and we are going to do quite a lot of work on it, and I am glad to see that the B.B.C. is going to run a series of nine television programmes on this topic.

The one that I am waiting to see is called "Woman's View". The synopsis of this shows that There are twice as many women as men between the ages of 65 and 70, and five times as many between the ages of 75 and 90. This programme will emphasise ways in which a woman's view is different from a man's— for example, the married woman who never retires but must adapt to her husband's retirement. The programme will also highlight some of the legal difficulties. Some men I know have retired and say that they hate it because there is too much washing up. Their wives enlist them for part-time work at home, and I think that it will be well worth while embarking on this study.

Now I come to the end of my review of work in progress, and I will confine my remarks to two matters. First, the major review, which is making progress. I can assure the House that it will be thoroughgoing, and, I hope, radical— radical in the sense that it will discard much that is traditional, and even conventional, in our approach to these matters. It is not intended that everything should wait until it is all ready. The instalment of short-term wage-related benefits is an indication of how we can introduce different parts of a new and comprehensive system at different times.

Here are the achievements and work in progress to satisfy, I think, the strongest critic, and even the extinct volcanoes sitting on the benches opposite. The stronger the economy, the more we can do. Even the Conservative pamphlet, this thing here, refers to "when economic circumstances permit", but to hear hon. Gentlemen opposite talk, one would think that economic circumstances did permit, at any time, to do everything, otherwise they would not be making such irresponsible criticisms of the deferment that we have felt bound to accept in respect of some measures. The overriding discipline of the economic situation must govern our activities, as well as those of any other Government that might be in our place, but we shall reject any censure from the benches opposite that we put off measures of social advance which either they would not have done at all or would have been obliged to postpone for the same reasons as ourselves. I hope that in the interval we can take another leap forward to set ourselves new objectives and work more energetically to reach them.

If we are looking for new aims in our national life, there is ample scope here. We are still one of the richest countries in the world. We still have one of the highest standards of living in the world. [HON. MEMBERS: "After 13 years of Tory rule."] We have the resources, aided and abetted by the energy of management and workers and by technological advance and skill. Governments alone do not do everything, even in 13 years. We have done quite a lot in the first year that the party opposite did not do in 13. We have the resources, and we have the skill. We have the means to make Britain a model of civilised living which would give full expression to the humanities and to social and cultural achievements, and I ask this question in conclusion: what better place can we conceivably wish our country to have in the world of tomorrow?

3.45 p.m.

Sir Keith Joseph (Leeds, North-East)

The right hon. Gentleman the Chancellor of the Duchy of Lancaster asked a number of rhetorical questions and showed at least that his mind was working on some of the problems which we, too, regard as important. But in the last passage of his speech he clearly showed that the country's present wealth and resources, which have to be deployed so as to take account of people's misfortune, for whatever reason, are due to 13 years of co-operation between Government, employers and employees for the greater prosperity of the people of this country.

The right hon. Gentleman said that not even his strongest critic could fail to be satisfied with the progress report that he had made. I am not one of his strongest critics. I enjoy his speeches, but I am not at all satisfied by a lot of what he told us today, and even less by what he omitted to tell us.

He blew five faint trumpets of complacent praise for his Government and himself on account of the five social service contributions in the Gracious Speech, and certainly some of these we can welcome in principle with him. Both parties included wage-related benefits for unemployment— and in our case for sickness and widows— in their manifestoes. Both parties provided for increases in public service pensions, though I must say in passing that, from what the right hon. Gentleman has told us about the scale of increases which the Government have provided, for the newest pensioners it has already been far exceeded by the rise in the cost of living during the last year. We shall look with great sympathy on the Workmen's Compensation Bill which is published today, and for these three Bills certainly we have a warm welcome in principle; but the right hon. Gentleman then referred to the steps to be taken to improve the family doctor service.

I thought that he dealt disingenuously with the intervention of my hon. Friend the Member for Birmingham, Perry Barr (Dr. Wyndham Davies). My hon. Friend asked the right hon. Gentleman how he reconciled what he had to say with the promise in the previous Queen's Speech to increase the number of doctors for the service of the public. The right hon. Gentleman did not say straightforwardly, as I suggest he should have done, that the Government do not contemplate increasing the supply of doctors. He implicitly accepted the assumption in my hon. Friend's question— which I presume my hon. Friend will explore further if he gets an opportunity to take part in the debate— that there will be more doctors in the near future. We all know the time that it takes to train and produce a doctor, but the Government should not seek to hoodwink the House or the country.

Paragraph 11 on page 187 of the National Plan says: No material change in the number of general practitioners engaged in the general medical services is expected over the next five years … This is very odd, because we do not rely for extra doctors purely on training new ones. This is the most important component, but if the right hon. Gentleman the Minister of Health's negotiations are successful—and we all wish him well with them—surely one of the results will be to reduce the flow of doctors who at the moment are either leaving the country or leaving the general medical services? We cannot, therefore, understand how it is that the Minister of Health and his right hon. Friends have already give up all hope of increasing the family doctor service, which means reducing the flow of dissatisfied doctors from that service. We hope that when the Minister of Labour winds up he will try to reconcile these different arguments.

The right hon. Gentleman blew his fifth trumpet in praise of the progress that he expects to make in the local health and welfare services. This progress we heartily welcome. Again, page 189 of the National Plan makes it clear that the increases which the Government expect in the local health and welfare services exactly conform to the increases proposed in the health and welfare plans put forward by my right hon. Friend the Member for Wolverhampton, South-West (Mr. Powell) when he was Minister of Health. In other words, the Government are proposing to follow the pace set by the Tory Government in their last Session.

The right hon. Gentleman will also have the great support of hon. Members on this side of the House in trying to rationalise the local authority personal social services. We are glad that a committee is to be set up to recommend what reorganisation is necessary. We hope that this committee will be given a brief to work fast and, if necessary, continuously, so that we do not have to wait too long for its recommendations.

We shall await with interest the report of the survey initiated by my right hon. Friend the Member for Bridlington (Mr. Wood) into the conditions of retirement pensioners, and we are glad that the Minister is himself initiating an inquiry into the social misfits, inadequates and drifters. We would ask him particularly to bear in mind that these individuals, much though they deserve our pity, often leave behind them a trail of damaged family life itself deserving the closest relief we can give.

We are glad that the right hon. Gentleman is looking into those problems that cross many Departments. His appointment and mine reflect the recognition by both main parties that there are in the social services many problems which cross Departmental boundaries and which require a synoptic view.

After a year in his job the right hon. Gentleman asked a large number of rhetorical questions, and he has apparently only just got down to identifying a number of problems into which we would have expected him to look far earlier. I have to deal with the social policy of the Government and also find time to deal with industrial relations policy, since the Minister of Labour will seek to catch your eye, Mr. Speaker, at the end of the debate.

First, I want to point out one or two of the major casualties in the Gracious Speech. The right hon. Gentleman has already sought to condone the omission of the minimum income guarantee. This was one pledge that the party opposite made before the election which was absolutely unqualified in terms of our economic circumstances. The other main social pledges were hedged around with qualification; they were only to occur when economic circumstances permitted. But the minimum income guarantee was a priority commitment to be carried out whatever the economic circumstances.

If it needed any emphasis, it can be pointed out that the election address of the Prime Minister said: An income guarantee will come without delay. That was his own election address. It is no good the right hon. Gentlemen claiming that the economic circumstances have now made it impossible. First, they never made any such qualification when they promised it and, secondly, the economic circumstances are the result of their own blunders. First there was the blunder in wrecking the confidence on which this country's economic health depends and, secondly, a series of blunders in failing to take appropriate action when they had wrecked that confidence.

Over the last year they have dribbled out a series of instalments— and the end may not yet have come— and it is only because of their incompetence in the first months and throughout the year in their handling of our economic affairs that they are forced to throw overboard a pledge the loss of which must hurt their consciences very deeply.

But there is something that the right hon. Gentleman did not attempt to excuse, and that is the absence from the Gracious Speech and from the National Plan of any reference to half-pay superannuation. This is another pledge which has been given year after year. The right hon. Lady the Minister of Pensions— who has explained that she has had to leave the Chamber for another engagement— herself said that the plan for half-pay superannuation, vigorously and actually costed, was ready for instant application". Where is it? It is not in the Gracious Speech. We find on page 204 of the National Plan that there will be no significant effect on expenditure as a result of any major pension review of this sort by 1970.

This is not just an absentee from the Gracious Speech; it is an absentee from the five-year Plan. The right hon. Gentleman, understandably perhaps, but oddly, since he was one who criticised the previous Government as evasive, failed to refer to or explain this in any way. We hope that he will do better next time in explaining to us and to the country why any of the Government's promises should be accepted when they fail both to carry out their promises and to explain what has happened to them.

This is all in very great contrast to the coherent and practical policies which the Opposition have recently published or announced. [An HON. MEMBER: "Pie in the sky."] An hon. Members says, "Pie in the sky". I hope that he will listen to what I have to say. He will find that it is the very opposite to pie in the sky. We in the Tory Party build on what is practical and what exists, and do not offer— as the party opposite has so flagrantly done— something which we cannot carry out when we are in power.

The economic position of this country at the moment is that earnings are rising and are likely to continue to rise. The difference between the two parties is that when the Socialists are in power the cost of living tends to rise as fast as or faster than earnings, whereas under a Tory Administration earnings rise far faster than the rise in prices. But with rising earnings and the prospect of middle-income status for our wage-earners not too far away in the future, it is clear that pensions should be wage-related, always provided that there is a decent base in old age for the lower-paid. It is proper for the State to see that people are covered by arrangements for a decent income in old age, but it is not the job of the Government to squeeze out private savings by making obligatory pensions so expensive that the cost is excessive and prevents private savings taking place. Our proposals, taking into account these trends and factors, are, therefore, to retain the State basic flat-rate pension as the foundation on which wage-related pensions plus private savings can be built. We propose virtually to abolish the State wage-related pension scheme, which has done the job for which it was introduced a few years ago, although we shall naturally preserve the benefits earned under it.

We can abolish the State wage-related pension scheme because the growth of private occupational pensions schemes has been so rapid. Already, 12 million out of an adult working population of about 20 million are covered by private occupational pension schemes, to a greater or lesser extent. Two-thirds of the adult men and one-quarter of the adult women in the working population are covered. More than £1,000 million— which is not pie in the sky—is being paid out year by year in contributions to private pension schemes, over two-thirds of that £1,000 million being paid by employers.

There are already about 40,000 approved schemes, and 2 million people are drawing occupational pensions of an average of £ 3 10s. a week, although varying greatly one from another. What we shall do is to require all people earning over, say, £ 9 a week, and from the age of, say, 25 or 30, to belong to such an occupational pension scheme. We shall lay down minimum standards, including some provision for widows. Some of the existing schemes which do not reach these standards will have to improve themselves by a set date. We shall require the preservation of pension rights on change of job. I am glad to see the Minister of Labour nodding his head. This will be subject to reasonable qualifications. We shall require regular audits of all these occupational pension schemes.

Every contribution under a private occupational scheme— or these private schemes— except for some public service pensions which are not funded— will be invested for the contributor or for his or her family if he or she dies before or shortly after retirement. The pensions are genuinely deferred earnings. The benefits are and will be much better value than the existing State scheme or than any other viable or tolerable State scheme could provide. They will be better because the contributions are invested and will grow for the individual involved.

The ending of the State graduated pension scheme will, of course, end also the contributions paid under it—

Mr. Archie Manuel (Central Ayrshire)

The right hon. Gentleman indicated a figure of a wage of £ 9 a week as a starting point for the scheme. He knows that we have hundreds of thousands of people in full-time employment earning under £ 9 per week. Does he intend, under this scheme, to leave them out, or should they apply for National Assistance when they retire? What is his answer to that?

Sir K. Joseph

I think that most men earn over £9 per week. There are very few who do not. Many single women, of course, earn over £9 a week. The person who earns less than £9 tends to be the younger person who is on his way to earning more and the married woman doing part-time work.

As I say, we shall bring to an end the wage-related scheme, though we shall keep some residuary scheme for those people who cannot be covered, for one reason or another, by private occupational schemes. The ending of the wage-related contributions under the State scheme will, of course, be a saving for contributors—both employers and employees—but much of the money saved to employers and employees will be needed to replace the subsidy lost to the basic scheme by the ending of the graduated scheme.

This will take some, but not all, of the saved contributions. All those 12 million people already in occupational private schemes will have no additional payments to make, except for the minority whose schemes may not reach the specified standards. In their case some extra payment, partly or wholly made by the employer, will be required to obtain extra benefits. The 7 to 8 million adults who are not now in private occupational schemes and their employers— in some cases, no doubt, the employers alone—will pay the necessary contributions to obtain extra benefits. We shall naturally see to it also that self-employed people are covered for the same purpose.

When all these schemes mature— and there are 12 million people now in such schemes, some more, some less, near to maturity— there will be no more poverty in old age. Meanwhile, however, we must treat those who are now retired and due to retire over the next few years with more generosity and humanity if their resources are insufficient for decent living. We must do this in such a way as to encourage and not discourage thrift. We have announced our intention to merge the Ministries of Health and Pensions and National Insurance into a new Department of Health and Social Security, with social policy research guiding our welfare, health and social security arrangements.

We pay tribute to the way in which the National Assistance Board carries out its work, but we intend to abolish the Board as it now is, to transform its duties and to transfer them to the new Ministry. We shall transform them in three principal ways. First, we shall give officials the positive duty of seeking out those in need, both elderly and those in other age groups. This will be a much more tactful and acceptable way of providing help for those in need.

Secondly, because we are concentrating on those in need and because this is virtually for the elderly an interim measure until private schemes mature for all, we shall be more generous in our arrangements for those in need. Thirdly, in order that none of this shall discourage thrift, we shall raise the disregards, so that people will be able to obtain help even though they have managed, by their own efforts, to save substantially more than is now disregarded.

This is a coherent and practical set of proposals, which shows up the poverty of the Government's ideas. They have made known no broad strategy either of pensions or of social welfare for the elderly and those in need. We must, of course, give them the benefit of the doubt until their review has gone further, but we are entitled to deduce from the wording of the National Plan that they have no hope or expectation of making their old ideas of half-pay superannuation effective even by 1970.

I will now turn to the vital resources which alone can provide the pay and the buildings to support the social services. These resources can come only out of a rising gross national product, which, of course, is the result of industry and commerce working within the Government's policies. This country— this is not a party matter—desperately needs higher productivity and redeployment of labour. We are very much in favour of easing the lot of those people who have temporarily to accept unemployment between two jobs. Therefore, as I have said, we welcome wage-related unemployment benefits. Indeed, we advocate more training, better pay during retraining, more help for moving homes and a better Careers Advisory Service. In this approach, both parties are at one.

However, there are other policies which are vital in order to increase productivity and to reduce over-manning. We can accept that responsibility for action and initiative, both in raising productivity and reducing over-manning, lies with management, but the responsibility for sensible co-operation in the interests of the country as a whole and of their own members in particular lies with the trade unions. We have announced our intention—my right hon. Friend the Leader of the Opposition has made this clear again and again—that we propose to stimulate both management and unions. Management will be stimulated by competition, by a more suitable tax structure, by requiring more information and by more management education.

Management will succeed in raising productivity only if industrial relations are good. Broadly speaking, industrial relations reflect the quality of management over the years and we recognise the importance of spreading good management practices such as effective personnel management, good communications, good selection and training of supervisors and quick action over workers' grievances.

When all that has been said and done, trade unions still have a position in this country virtually above the law. They can, and often do, block good management to the harm of their own members and the country as a whole. Strikes and the threat of strikes interrupt production, damage output and productivity often over a far wider field than the immediate strikers, do harm to the reputation of our industries abroad and thus, injure our export performance. Strikes and the threat of strikes often lead to inflationary settlements. Of course, we can all agree that management should resist even the threat of a strike where they think a concession is wrong. Of course, they should not concede to unofficial spokesmen what they refuse to official spokesmen.

A Government encourages irresponsibility if it allows demand in some areas far to exceed supply. I hope that the right hon. Gentleman noticed the article in the Financial Times a few days ago about the desperate search for virtually non-existent labour which is going on in the Midlands at the moment, with all the damage which that must do to the country as a whole.

After acknowledging all that, it is still true that the privileges given to trade unions put them above the law. As part of a general strategy to increase efficiency and prosperity, which will include actions directly addressed to management as well as to trade unions, we have announced certain intentions for trade union reform.

First, we think that the law does not protect union members completely from suffering hardship at the hands of the union and that when it does, the process may be long and expensive. We propose, therefore, what amounts to a Bill of Rights for trade union members. We intend that if associations of employers or employees are to be entitled to the privileges of trade union status they must submit their rules to the approval of a new registrar. It will be his job to see that these rules conform to certain basic principles.

Secondly, we propose that the dispute procedure element of collective agreements should be enforceable against unions or management by way of fines— fines which, in the case of unions, anyway, should be limited. We believe that unions will be stimulated to improve their communications with their members by these means. We agree that if the fines were unlimited all sorts of dangers would follow, and I emphasis that in the case of unions we propose that the fines should be limited.

The Minister of Labour (Mr. R. J. Gunter)

I should like to have one point clear in order that I may consider my reply when I wind up the debate. It is argued that a breach of a collective agreement or a breach of a procedural agreement would be punishable. That leads to the next step. One cannot have a collective agreement covering an industry or a works unless there is a closed shop. Everybody must be party to the collective agreement. Do the Conservative Party now agree that a closed shop is desirable?

Sir K. Joseph

I think that that is fundamentally wrong on two main counts. First, we all know of an industry in which there is a closed shop—the coal mining industry. There has been a long series—possibly explicable historically; I will not enter into that—of disputes in the mines, so that a closed shop in itself is no guarantee—witness the coal mines— of industrial peace. On the other hand, there is industry on industry and factory after factory in which unionisation ranges from nil to 90 or 95 per cent., and in those factories there is industrial peace. There may be many, there may be few, unionists in each factory. But industral peace, after all, depends generally on the trade union members, not upon those who are not trade union members.

Mr. Gunter

I am not advocating a closed shop. I have never advocated a closed shop. What I am trying to find out is what action is to be taken in respect of men who are not in a union and who are therefore not bound by a collective agreement, although they have benefited from it. What does the right hon. Gentleman propose about them?

Sir K. Joseph

I do not know of cases—and I should have thought that they would have come out in the newspapers—in which it is non-members of the unions who make trouble and lead unofficial strikes.

Mr. Charles Mapp (Oldham, East)

They do.

Sir K. Joseph

This fact does not come out in the newspapers and it has not appeared in the academic studies. Normally, the problem of the unions is a failure to control their own members, and it is to stimulate them to improve their control of members—which we do not think in any way involves the necessity of a closed shop—that we advocate this enforceability of procedure agreements. The answer to the right hon. Gentleman is that we do not think and we do not accept that a closed shop is in any way a corollary to what we are proposing.

Thirdly, we propose a new system of labour or industrial courts, local, regional and national, to deal with appeals from the registrar, to deal with charges that a union or management have broken a procedure agreement and to deal with dismissal grievances. The object in proposing this new system of courts is to provide quick, informal, cheap justice and so to deal rapidly with grievances which might otherwise fester to the harm of all concerned.

Our fourth proposal is that where unions are established, employers shall accept the duty to recognise and the duty to negotiate with them if the majority of their employees desire it. This is something for which the unions have long asked.

Our fifth proposal is that as the preamble to legislation we shall introduce a code of good industrial practice, non-enforceable, so that both employers and employees will be able to refer to a handbook of the best current practice as it affects all concerned.

These are five suggestions which we have made, not forgetting that we are pledged to consult the Royal Commission, the F.B.I. and the T.U.C. before legislating. They are reasonable, moderate and constructive proposals. In fact, they are very much in line with the approach contained implicitly in the Minister's own evidence to the Royal Commission on Trade Unions. This is admittedly official evidence, and the civil servants rightly limit themselves to comment on the various alternatives, but they seem by implication to approve, or at least not to have strong arguments against, the proposals which we make. Ironically, it is only our proposal that the unions should in certain circumstances be recognised by employers that they seem to think unnecessary. The argument is on page 84 of the evidence.

We well realise that there are big issues which we have not touched, and the biggest of these is restrictive labour practices. We think that the spur which we propose to management through competition, the changed tax arrangements, and the disclosure, as recommended by Jenkins, of more information will set in process action by management to reduce and eliminate such restrictive labour practices. But there may well need to be something more.

We certainly do not think that the Government are entitled to be pleased with themselves, as was indicated by the Prime Minister's speech yesterday. The Prime Minister yesterday went so far as to boast of an all-out attack on restrictive labour practices. He must not confuse himself or seek to confuse the House or the country with words, committees and commissions when what is needed is effective action and in some cases changes in the law. We all saw the comment of The Times on the virtually useless, if not damaging, proposal by the Prime Minister in September of production committees. The Times said: "This proposal came out of the blue to the Departments of Labour and Economic Affairs." The Times implied that it "contributes nothing to the solution of our real problems but is just a proposal for the sake of making a proposal".

To go through the list of the boasts which the Prime Minister made yesterday, the Government have made the right noises about liner trains, but the test is still to come. We read in the papers this morning that the clash is still before us. We wish the Government luck and we hope that their courage will hold, but there is certainly nothing yet to boast about. On Devlin and the docks, we congratulate the right hon. Gentleman on the speed with which he moved on a number of Devlin recommendations, and again we wish him very good luck in the country's interests, but the test, again, is still to come. There is nothing yet to boast about.

The Prime Minister quoted shipbuilding and boasted of an all-out attack on restrictive labour practices in shipbuilding. In fact, all that he has done is to appoint the Geddes Committee, an ill-omened name. We all know what happened to the last Geddes Committee— admittedly, headed by another Geddes; their proposals were rejected categorically by the Government. The Prime Minister also boasted of an all-out attack on restrictive labour practices in printing when all that has happened is that Mr. Aubrey Jones has put down a description of some of the restrictive labour practices in printing, coupling it, it is true, with an invitation to report progress, if any, in the next year. We must hope that progress is made, but, again, the test Is still to come. The test is still to come in each and every one of these restrictive labour practice areas, for an all-out attack on each of which the Prime Minister so unjustifiably praised himself yesterday.

Of course there is much wrong, but are the Government going to do anything about it? They never even mentioned the trade unions in their election manifesto. Before the election the Prime Minister sneered at the idea of a Royal Commission as "taking minutes and wasting years". He may well regret that witticism now, for a Royal Commission has been appointed, and the suspicion must remain that it was appointed only to save the Government from having to do anything about the trade unions.

We ourselves raised this matter at the election, and we did not have anything in mind as slow as this method. If the Prime Minister and the Government recognise that there is a need for change and that that need is urgent, then may I repeat what my right hon. Friend the Leader of the Opposition has already invited them to do: let them invite the Royal Commission to report soon, and let them ask the members of the Royal Commission to sit continually for a short spell of time rather than for intervals over a long period. The preliminary work has been done and the evidence is coming in. I hope that the Minister of Labour will deal with that suggestion when he replies to the debate.

I have had to go relatively quickly over social policy and industrial relations policy, but I think that there emerges from all this a consistent picture of a Government, whether on pensions or industrial relations and trade unions, having no policy and taking no decisions. We have had from the Chancellor of the Duchy of Lancaster a series of valuable but relatively minor proposals. We have had no word of encouragement about the major strategy that lies ahead. A minimum income guarantee he has deferred indefinitely. Half-pay on retirement has gone into limbo and is not even provided for in expenditure in the National Plan. On trade unions there is certainly no smack of firm government—just words, and committees, and a Royal Commission—with all the tests of policy and Government courage still to come.

We have announced our intentions in both these fields with relevant, constructive and sensible policies. The Government have no such policies. Both their record and the Gracious Speech by its omissions show that the Government in both these fields are evasive and ineffective.

4.21 p.m.

Mr. Michael Foot (Ebbw Vale)

No one who listened to the speech of my right hon. Friend the Chancellor of the Duchy of Lancaster will doubt or question the impressive nature of the measures which the Government have already produced in the field for which he is responsible or which he surveys, nor the importance of the measures which he and the Government are proposing to produce during the next twelve months. I do not believe that any charge could be levelled against my right hon. Friend or his associates about their energy in proceeding with these matters. I can, therefore, understand very well the embarrassments of the right hon. Member for Leeds, North-East (Sir K. Joseph).

It was very difficult for the right hon Gentleman to explain why he took such a testy attitude towards all these propositions. In particular, I think that the right hon. Gentleman was in a specially awkward position in dealing with trade union practice. I am always a bit suspicious of Tories when they talk about trade union matters. I know that the Tories try to pretend that they are good friends of the trade union movement, that they have directed their efforts in the past to the welfare of the trade union movement, and that they approach these matters today solely for the purpose of assisting the trade union movement in overcoming its own difficulties. That is the kind of attitude they take. Very often Tories talk as if all the original martyrs in the cause were members of the Tolpuddle Conservative and Unionist Association. [Laughter.] They were not even members of the Liberal Party. There is no need for Liberals opposite to laugh. The Tolpuddle Martyrs were martyred by a Liberal Government with the fulsome support of the Tories.

We on this side of the House, therefore, are very suspicious about hon. Members opposite when they talk about all these matters, and particularly the trade union question. However, many of my hon. Friends know very much more about the trade union question than I do and, therefore, it is one of the subjects about which I have to keep my mouth shut, except when I deal with the irrelevancies of hon. Members opposite.

We have had an impressive account from my right hon. Friend, and I have no doubt that when my right hon. Friend the Minister of Housing and Local Government outlines the housing Measures to be put through by the Government in the next few months that will be equally impressive, if not more so. Therefore, those of us who have criticisms to make of the Gracious Speech are not criticising because we do not think that there are many good things in it. Indeed, we do so think.

It is my expectation and hope that we shall have a prosperous and successful Labour Government in office for the rest of my lifetime and even beyond. I dare say that many years hence I shall look down from my vantage point in some celestial place below the Gangway, and I shall be happy to study on 1st January in the year 2,000 how my right hon. Friend the Prime Minister has managed to capture the headlines on that day. I shall also be interested to see whether we have got steel nationalisation by then, and it will be interesting to study how many new Leaders of the Conservative Party have been elected in the interval by the Humphry Berkeley process, or it may be that the hon. Member for Lancaster (Mr. Berkeley) will be a candidate on that occasion, and if that should be the case and he should be elected modernisation will have come at last.

I must say to my right hon. Friend the Prime Minister that there is one part of his speech which I criticise most severely, a part of his speech where I thought he spoke quite improperly and used language which certainly should not be used. I refer to the most ferocious attack delivered by the Prime Minister on the right hon. Member for Wolverhampton, South-West (Mr. Powell). It was most unfair of the Prime Minister. I am sorry that the right hon. Member is not here, because I always like to pay compliments to people to their faces, whatever I may say behind their backs.

The right hon. Member for Wolverhampton, South-West, in my opinion, is the best of the whole bunch opposite. He says what he thinks. It does not always get him very far, or other people for that matter. He says what he thinks and nothing will break him of the habit. Nothing will break me of the habit, except elevation to the highest office of State, but the Prime Minister is not in a retiring mood and, therefore, that possibility does not arise.

The right hon. Member for Wolverhampton, South-West deserves great credit. To bury the British Empire in an official speech as spokesman on defence policy at a Conservative Party conference really takes some doing. All of us should acknowledge such a marvellous example of impudent daring. He also had some sense in What he said and, therefore, the Prime Minister should have been more careful in how he spoke about the right hon. Gentleman, particularly as so many of the other members of the party opposite are now following his course. The right hon. Member for Wolverhampton, South-West is the real Leader of the Conservative Party. He won that election a few months ago. He has got the rest of them mesmerised.

One of the right hon. Gentleman's chief disciples—and I am sorry that he is not here—is the right hon. Member for Enfield, West (Mr. Iain Macleod). He has been converted to laissez faire in the last few months. He said in a speech on the National Plan that the great principle which the Tories must now establish, the one word which is the very keynote, was the word "choice". I must say that that statement coming from the right hon. Member for Enfield, West in the circumstances which we recall over recent years is surely a most gallant proposition. Nobody chooses him.

As for the Leader of the Opposition, comments have already been made upon this and the matter was referred to by the right hon. Member for Leeds, North-East. He referred to the so-called economic blunders which have led to the present situation. We all know that the Leader of the Opposition is very eager to kill what he calls this "disgraceful lie" about the £800 million and that he is going up and down the country telling us what really happened. I read his speech at the Conservative conference with great interest. It was a revelation to me. I had thought that we have got into those balance of payments difficulties because of circumstances beyond the Government's control at that time, or maybe a little bad luck, or something like that. But not a bit of it! The right hon. Gentleman said that it was all arranged by his colleagues; that they did it on purpose; that they left the biggest balance of payments crisis in history all according to their plan. If any speech could make it even more certain than it is already that we shall be very little bothered by the challenge of right hon. and hon. Gentlemen opposite, it is the right hon. Gentleman's own exposure of how, in fact, the legacy of the previous Government which has caused many of the difficulties of the Government was something designed by the previous Government. If they did it on purpose on one occasion, who knows that they might not do it on purpose again?

However, as I indicated before, I am critical of certain matters in the Queen's Speech—or perhaps certain matters that are not in the Queen's Speech —and I am entitled to put some questions to the Government. In May of this year, this House of Commons approved a White Paper on Steel Nationalisation. Many speeches have been made from different parts of the House saying that it is very awkward for the steel industry not to know where it stands. I do not subscribe to that point of view, because it appears from all the production figures which the Steel Federation has spent so much of its shareholders' money on publicising in the newspapers that nothing is so good for the production of the steel industry as the threat of nationalisation. The longer that threat has gone on the more the production figures have gone up, so it is said. I therefore do not argue on that basis. But whatever the steelmasters may say, the people who work in the steel industry and Members of Parliament and the public certainly have the right to know what is the Government's position arising from the fact that last year the proposal for steel nationalisation was in the Queen's Speech, and this year it is not.

Let us, therefore, first look at the White Paper and ask the Government the perfectly proper question whether they still subscribe to certain of the statements which appeared in the White Paper and were presented to the House—and strongly supported by Ministerial statements—and eventually approved by the House of Commons in May of this year. For example, on page 7 we read: It is essential in the interests of the British economy that the improvement in the efficiency of the iron and steel industry which can be obtained from the common ownership of its main units should be secured as quickly as possible. Later in the same paragraph we find: In the Government's view, nationalisation of the main part of the iron and steel industry is the only appropriate means of securing quickly the benefits of common ownership. I agree with those statements, and I want a fuller explanation than we have yet had from the Government as to why the Government have changed their mind— if they have changed their mind—because it does not appear here. One cannot say in May that this is the course required to secure this action as quickly as possible and then not propose to follow up such a statement in November.

Again, I am in absolute agreement with the view stated by the Government on page 15 of the White Paper: An efficient and dynamic steel industry, fully co-ordinated into the Government's general economic plan, is of paramount importance to the country. The word "paramount" has something to do with priorities. One cannot say at one moment that something is of paramount importance to the country and at the next moment that it comes low down in the list of priorities. I am, therefore, entitled to ask why the Government have changed their mind on the paramountcy of this question.

Mr. R. J. Maxwell-Hyslop (Tiverton)

Perhaps the hon. Gentleman will recall Tom Lehrer's song: So please remember, when we part in November, I told you so in May

Mr. Foot

After we had that debate in May on the White Paper, we passed the words I have just read to the House. We had some discussions within the Labour Party on the matter and, in the subsequent week, a statement was published on the decision of the Government. This confirmed what was said in the White Paper, and said that the Secretary of State for Economic Affairs had said that he was to have consultations with or listen to representations from the steel industry—[HON. MEMBERS: "And the Liberal Party."] He did not take much notice of the Liberal Party then, but we will come to that in a moment.

The Minister was talking of the steel-masters and said that he would listen to representations from them. That caused concern to some of us and the statement was made: Reference has been made to willingness to listen to any representation from the industry. It would have to be made clear that such consideration will not be allowed to delay the Government's timetable. That is a question of priorities.

What is the Government's timetable for steel now? The National Plan says —quite rightly, in my opinion—that for the purposes of the National Plan it will be necessary to have a fundamental reorganisation of the steel industry. That is quite right, but the White Paper says that a prerequisite of securing the reorganisation of the steel industry is that it should be brought into public ownership. So what is the Government's timetable for steel now? When do they think that they will be able to take the measure which, on their own test, they say is necessary for the reorganisation of the industry? Whatever the steel-masters may say, the public have a right to know, if the Government have changed their timetable, when they believe this action will be effective, because the Government themselves have repeatedly said that drastic action is required to deal with the industry.

I know that it will be said in some quarters that the postponement of this action is not only a question of Parliamentary priorities, which is what I have been referring to, but is a question of political manoeuvres—if one likes to put it that way; a question of how to deal with the Liberals and some others. We had some guidance given to us on this matter in The Times on Monday—and here, again, I ask the Government whether this is a correct account. The political correspondent of The Times is a journalist greatly respected, I believe, in all quarters of the House, and someone who I do not believe publishes something in his column unless he has good foundations for publishing it. He is an honourable journalist. He will certainly not reveal his sources, and I certainly will not ask him to do so.

This is what he said on Monday. Speaking of the Government, he asked: "What explains their confidence?" He answers that question by saying: It is, above all, their secure sense that they have Mr. Grimond and the eight other votes that go with him"— once there were nine: on their side in what will prove to be a de facto radical alliance. No, the ministerial voices explain"— so he has been listening to some Ministerial voices—unless he is a new Joan of Arc: there have been no formal talks with the Liberals and no crude horse-trading. Has there been any subtle horse-trading? The article continues: Mr. Grimond and his squad will be as unhindered as before to come and go in the division lobbies. That will not mean any great change for anybody: But make no doubt that those nine votes— producing an effective majority over the Conservatives of 20 or so—will be at Mr. Wilson's disposal on his days of need. If you press for a little more chapter and verse, the admission comes that these are no more than inferences drawn from what is called the demeanour of the Liberals in smoke-filled rooms. That, in turn, is a euphemism for saying that the Liberals now seem to know which side of their bread is buttered. That is a bit of a change from the Liberal Party conference. There they were talking about getting their teeth in the red meat. Now they have come down to bread and butter, which, in my opinion, is more than they deserve. When the Leader of the Liberal Party said at his conference that he was getting his teeth into the red meat of power, so horrified was one-tenth of his party— the hon. and learned Member for Cardigan (Mr. Bowen)—at this appalling spectacle that he took the pledge of a permanent vegetarian diet for the rest of his political career. As for these red meat-eating Liberals, a more obviously milk-fed lot of carnivores I never saw in my life, with the possible exception of the hon. Member for Caithness and Sutherland (Mr. George Y. Mackie). who has a vested interest in the matter.

Mr. David Steel (Roxburgh, Selkirk and Peebles)

Does this mean that the hon. Gentleman will never show any gratitude on any occasion when we happen to support the Government in the Division Lobby?

Mr. Foot

I shall explain my attitude to the Leader of the Liberal Party and his colleagues as clearly as I can. It would be very foolish and particularly dangerous if the Government were to make any kind of horse trading—that is the word. I think—with the Liberals, crude or not, on matters on which the Labour Government have made commitments to my constituents and to other persons who have sent many more than the Liberals to the House of Commons.

Although when I look across at the Liberal benches I do my best to maintain a humorous vein, these are not humorous matters. It would be quite wrong of the Government and highly dangerous—indeed, it might be the only thing which could destroy the long-term prospect of Labour government in this country—if they were to forsake principle for manoeuvre and were to think that they could get solid backing for their policies by an agreement with the Leader of the Liberal Party. I do not say anything against the Leader of the Liberal Party personally, but I recall that the most diligent activity that I have seen from him in the House of Commons during the whole of the period that I and he have been here was in fighting the great radical Finance Bill that the Labour Government introduced last Session. I had never before seen him here so often. I scratched my head and wondered why the Leader of the Liberal Party was turning up so diligently to fight on the issues of the Capital Gains Tax and the Corporation Tax. It may be because I am a cynical type of fellow, but I could not help thinking that the right hon. Gentleman's activity at that time had some connection with the local election results. At that time the Liberals thought that the Government were unpopular, so the Liberals thought, "We had better move away from the Labour Government as far as possible in case there is a disaster and we, too, go down". Therefore, I would not advise the Labour Government to place much trust on a reed shaken by every wind. It will not do them much good.

Mr. T. L. Iremonger (Ilford, North)

Did not the local elections take place before the main debates on the Finance Bill?

Mr. Foot

As the election results came through the animosity of the Leader of the Liberal Party against the Government increased.

I regard it as a grievous disappointment, to use the words employed by my right hon. Friend the Chancellor of the Duchy of Lancaster—I am sure that he used those words absolutely sincerely— that steps to secure the introduction of an incomes guarantee have been postponed. Of course, this is a grievous disappointment to me, and I do not say that in any sense in mockery of my right hon. Friend. However, it is equally a grievous disappontment to me that the Steel Bill, which should have been in this Gracious Speech, is not mentioned there. I am entitled to say so. I and those of my colleagues who share my view on this matter intend to table an Amendment to the Gracious Speech to express our views, so that those who have sent us here shall know, amongst other things, whether we are fulfilling the views that we were sent here to state and to represent.

I am certainly gratified that, although the Government are dropping the proposal this Session—I withdraw none of my criticisms on that score—they have made it clear that it remains in the Labour Party's programme. That commitment is absolute—is it not?

Mr. Houghton

indicated assent.

Mr. Foot

I am very glad to learn that. The commitment of the Labour Party, the principle of public ownership and of introducing it as speedily as the Government think it is possible, is absolute. That means that steel nationalisation will be in the next election pro- gramme of the Labour Party, if we have not been able to introduce it before— does it not? [HON. MEMBERS: "Answer."] I am sure that the best person to answer that question is my right hon. Friend the Prime Minister. [HON. MEMBERS: "Where is he?"] I make no complaint about the fact that my right hon. Friend is not here. He has many other matters to deal with. I am sure that he will answer it. I have not any doubt about what his answer will be. [HON. MEMBERS: "Oh."] His answer will be, I am sure, that steel nationalisation will be in the next election programme of the Labour Party, if we have not been able to carry it out before.

That should be understood in all quarters. It should be understood by the Liberals. It should be understood by the Tories. It should be understood by the steelmasters. I have taken all this load of anxiety off their minds! The Measure will go ahead. And speaking not only for myself but for a few others, the sooner we go ahead with this project the better.

If the Labour Government say, "We have not got a majority here and now for such a Measure", which they say is essential to the economy of the nation and is paramount in the interests of the nation, if they have not got that majority in the present House of Commons they should make up their minds to get that majority as speedily as possible. Therefore, I am in favour of an early election. [HON. MEMBERS: "Hear, hear."] I think that it would be good for the nation, good for the Labour Party, good for the economy, because it would enable the Government to carry out the whole of their programme, and good because it would transform into deeds what the Prime Minister said at the end of his speech, namely, that the Conservative Party has become an irrelevancy.

The Conservative Party is an irrelevancy, but there are still too many Conservatives here in this place. We have some arguments about the reform of the House of Commons. I am in favour of the reform of the House of Commons, and the greatest thing wrong with the House of Commons is that there are too many Tories in it and a few too many Liberals. Let us have an election as early as possible to remedy this state of affairs.

4.48 p.m.

Sir Tatton Brinton (Kidderminster)

It is a grave disadvantage to be called immediately after such an admirable orator as the hon. Member for Ebbw Vale (Mr. Michael Foot) has sat down. As I listened to that horny-handed pillar of the trade unions, with his hands calloused by long use of his pen, I realised how unworthy I was to speak on any trade union matter. The hon. Gentleman spent a great deal of his time attacking the Tory Party, and subsequently the Liberals; so long, in fact, that I began to wonder whether the steel in his soul was about to be sublimated.

However, the hon. Gentleman eventually came back to the burning question in which he and certain of his hon. Friends are chiefly interested—the fate of steel nationalisation. I think that the hon. Gentleman can set his heart searchings at rest. The Prime Minister is well on the way to dropping the word "Socialism". In fact, I think that he has already dropped it. The word "Labour" is becoming used less frequently. The word "radical" is gradually taking the field. If I were the Leader of the Liberal Party I would be very worried, because I believe that the Prime Minister is about to lead his party into the Liberal camp under the general name of "radical". If I may offer a word of advice to the Leader of the Liberal Party, I recommend that he remember the words of Lewis Carroll, 'If this should stay to dine', he said, 'There won't be much for us!' I turn now to a question which bears on industrial relations and has rather more to do with the practical matter of industrial costs. We are at present very much concerned, on both sides of the House, about unofficial strikes and the way they impinge both on morale and on the prosperity of industry. I do not underestimate this as an important factor particularly in relation to morale, but let us not get lost in the idea that unofficial strikes or strikes of any kind are really a major cost to the economy of the country as a whole. I do not believe that they are. But what is a major cost, and what should be a great worry to us on all sides, is the gradual upward creep of wages and salaries unrelated to an increase in production.

The approximate figures which we have heard recently in the House show that, in the course of the last year, there has been about an 8 per cent. increase in actual earnings accompanied by only about a 1 per cent. increase in output. This is the crux of the matter. How has it come about? I shall point to one or two ways in which it happens, very often imperceptibly and not necessarily because of new negotiated agreements but by a sort of automatic process which we must find some way of restricting in order to keep increases in line with rises in production.

The sort of thing I have in mind is the constant demand for shorter working weeks. This is an objective which one could well support if it meant that people wanted and needed a shorter working week and really proposed to work it. But, in fact, they do not. The figures show conclusively that the number of hours actually worked in industry, 47 or 48 hours a week, has not varied in the last 20 years. Negotiation for a shorter working week is, in fact, negotiation for an increase in earnings for the same length of working time. This is one of the sources of the creep. It is a very subtle way of negotiating because most people, including many employers, would agree that greater leisure throughout the country is something to be desired, and it is difficult to argue against it. But the case is genuine only when the shorter working week is actually worked at the normal place of employment and people do not take on a secondary job.

In my view, it would be much in the interest of trade unionists themselves and of the country at large if there were concentration of attention on longer holidays. The case is proved by the figures. The fact that people continue to work 47 or 48 hours a week, on average, proves that this is, by and large, a fairly natural sort of working week. I imagine that most hon. Members work a very much longer week than that, but I do not see that many of them look too miserable on it. It seems that the natural working week is the length of time that most people prefer to work, that is, about 45 hours a week or a little more. I am sure that what most people would like— it is certainly what I should like—is a longer annual holiday, preferably a whole week or fortnight extra each year which they could really call their own.

I am glad to see the Minister of Labour present, and I put it to him that the actual effect on costs of an extra week's holiday, assuming an average of 48 or 49 weeks worked in the year and the same pay expected to be received, would be a fraction over 2 per cent., but a reduction in hours from 42 to 40 would represent an addition to costs of 5 per cent. directly, assuming the usual agreement whereby no pay is lost. In fact, of course, it would amount to rather more than that because the two hours are not added on as a straightforward cost but will subsequently be paid for at overtime rates, inflating actual costs even further to an average of—if I have the figures right—something like 5.8 or 5.9 per cent. Thus, for the same hours and the same work produced there will be an addition to costs of up to 5.9 per cent.

Would it not be better for the Government and for all of us, employers included, to say that, at the present stage of industrial development in this country, extra holidays are the right thing and shorter working weeks, by and large, are not? Would not this make much better sense and have a much better effect on our industrial costs? In my view, it would be a far better way to progress in the future in what we hope will be a constant improvement in the terms and conditions of work than the way we are going at present.

I come now to the question of piecework rates and their actual effect in industry. I do not criticise piecework because it is an inescapable necessity in very many types of jobs where the man can control the output of the machine. It may well be inevitable that piecework should be the method adopted in such cases, but there is a consequential difficulty created in many industries by the piecework system, and it arises in this way. A new machine is developed by people quite outside the shop floor and it is then introduced. The immediate demand is that the savings from the use of this machine should be divided, usually under some sort of agreement whereby the firm saves a bit of money, the price to the customer, so it is hoped, is marginally reduced, and something goes to the shop floor worker. On the face of it, that is a perfectly fair arrangement, but the result often tends to be that the piecework earnings of the man operating the machine gradually rise out of due proportion to the earnings of the man supervising him, of the engineers who produce the machine, and of the skilled man working on time rates.

The man working on time rates, very often a highly skilled fitter or something of that kind, does not receive any of the benefits of new inventions or developments except as a result of negotiations which, while raising his earnings, will at the same time raise the pieceworker's earnings as well. This is one of the dangers of reliance on piecework, that it produces an imbalance between the time-rate worker's earnings and the pieceworker's earnings. I am sure that many trade unionists will be able to confirm that.

There is a problem here, and I do not see how the Government themselves can tackle it. It is much more a question on which the employers and the unions should concentrate in the future, to ensure that the highly skilled man on time rates is not penalised by being on time rates because it is impossible to measure the actual work he does by normal measurement methods.

I come now to another question which is probably a more long-term one for high-level agreement between the T.U.C. and the C.B.I., or possibly for Government action. I refer to the impact which agreements, often not in major industries, may have on other firms in the same industry, then on other industries, and in due course on the economy of the country as a whole. How much longer can we accept that agreements can be made, as it were, in a vacuum, to suit only those people making them and without reference to the economy as a whole? This is probably a truism, but it raises a dangerous aspect of our industrial life for the future.

The argument in favour of a particular agreement may be that the firm is doing very well and can afford to pay more wages. No doubt, that is perfectly true and a quite fair argument, but the raising of wages in that firm will entail demands in other firms, then in other industries, and so on throughout the economy by the sort of spread of wage levels which goes on. This process will take place although, very often, the basis on which the later rises are agreed will not at all be the basis of the original agreement.

I put this question to the House without myself knowing the answer. Perhaps the Minister of Labour may have an idea himself. To what extent will it be necessary—I should very much regret it, but it may be necessary—for the Government in future to take a much closer look at these developments? The Minister may say that the Prices and Incomes Board exists for precisely this purpose, and perhaps it will be able to do something, although I rather wonder what sort of teeth it will need for the purpose. To what extent will the Government in future have to look at wage agreements, particularly in more important firms, from an overall point of view, first, with reference to the particular industry and, second, with reference to industry as a whole?

It seems tome that many of these difficulties would be reduced, though not necessarily solved, if the trade unions could only bring about a radical reduction in the total number of unions operating. This is another truism, but my own firm, which makes carpets, already deals with five different unions. Does a carpet factory need to deal with as many different unions as that? Surely, one or, perhaps, two would be all that are necessary, although I recognise that certain of the skills which are used might be well outside the scope of carpet making. We must all know of instances in which it is a question, not of five unions but, perhaps, of as many as 17 or even 20. In Germany, I am told, there are only 16 unions covering the whole range of industry. That may be too few for this country, but we have 170 affiliated to the T.U.C. alone and probably many others which are not affiliated.

Somehow or other this problem must be tackled. I understand that it is being tackled already in the building trade. It will be interesting to know from the Minister when he replies how much success there has been in amalgamating, I believe, seven unions in that trade which are now trying to produce one overall building union. This is very much a step in the right direction. Obviously, every pressure, assistance and persuasion should be used to cut down the excessive number of unions, which makes it exceedingly difficult to arrive at agreements which are valid within a given factory. When one makes an agreement with one lot of people in line with their general national agreements, and another agreement in line with another union, the two frequently do not match, friction arises and out of it all can grow industrial difficulties and bad relations. One single union within a given factory would be an enormous help in establishing better relations. I would hope that we could make progress on these lines without having to uproot the whole system from the ground up.

Mr. Simon Mahon (Bootle)

As the hon. Member is in favour of having only one union, would he be in favour of having one employer on the Liverpool dockside?

Sir T. Brinton

That is a question which I would prefer to have addressed to somebody with direct experience of the docks. I do not have that experience, so I will not attempt to answer it. What I said was that in a given place of work it would be a convenience to deal with as few unions as possible, preferably only one, although I admit that in some instances one alone might not necessarily be appropriate.

We should try to reduce the number of unions which have to be dealt with, so that they may themselves have wider authority over a given industry in making agreements and to cut down the enormous complication and the vast amount of time which is wasted. Managements waste a great deal of time, and so do union representatives, in negotiating in matters of detail merely because of the multiplicity of bodies that have to be dealt with.

5.3 p.m.

Mr. Gregor Mackenzie (Rutherglen)

In the very nature of a general debate of this kind it is inevitable that we jump a little from subject to subject. I trust, therefore, that the hon. Member for Kidderminster (Sir T. Brinton) will not think me too discourteous if I do not follow all his remarks. I found the hon. Member's comments on the need for a longer working week rather interesting.

Sit T. Brinton

I did not ask for a longer working week. I ask for a cessation of the constant "phoney" cutting down of the existing week.

Mr. Mackenzie

I appreciate the point. The hon. Member must, however, look into the minds of many of those working in industry to find the reasons why they have constantly asked for a shorter working week and why, at the same time, a number of them ask for overtime. There are probably good historical reasons for this. In the part of the world from which I come, a man going for a job very often asks whether there will be overtime on, say, Tuesdays, Thursdays and Sundays. In the nature of things, this is because he tries to put away as much as he can for a rainy day and he feels that by working overtime in this way, he can afford himself a measure of protection when unemployment hits him, as it has hit the people of Scotland often and hard in days gone past.

My comments, however, in this general debate must, in common, no doubt, with those of other Scottish hon. Members, relate more to the proposals contained in the Gracious Speech concerning Scotland. When I looked at the Gracious Speech and read it carefully, it was a long time before I saw any reference to the Government's proposals for Scotland. They come almost in the last paragraph of the provisions which are set out. I was a little taken aback to see that we had been relegated to the last page and almost the last paragraph.

It was only when I had time to think about it that I appreciated that as a result of the Measures envisaged in the remainder of the Gracious Speech, we in Scotland will get advantage from parallel legislation; and, secondly, that since the paragraph in question in the Gracious Speech is widely phrased, it means that many hon. Members from Scottish constituencies will be able to offer to my right hon. Friend the Secretary of State and his colleagues their opinion about how he might use the blank cheque which has been issued to him in the Gracious Speech. We can put forward many of our hopes and aspirations and I have no doubt that many hon. Members from Scotland could fill quite a catalogue with their hopes for the people whom they represent.

We have in Scotland an old saying that "the greetin' bairn is aye fed first". It means, roughly, that he who cries the hardest is most likely to succeed in getting his demands met. I suppose that during the course of the next few months we will use this method to put our point of view to the Government.

This is also, however, a time for stocktaking, as the hon. Member for Scarborough and Whitby (Sir A. Spearman) suggested yesterday, and I should like to make one or two comments on what has happened in Scotland over the past year. This also is important because, like so many other hon. Members, I was deeply concerned in past years with the real and serious consequences of the former Government's policy as it affected employment in Scotland.

We have all been delighted this year to find that unemployment is now at a lower figure than for a very long time. It is not as good as we would like it to be, but it is a great deal better than it was as a result of the work of the previous Administration, when sometimes, in Scotland, even during the last five years, despite the buoyancy of the economy in other parts of the country, we had over 127,000 people unemployed. That is a very high figure, even for a country like Scotland.

Notice taken that 40 Members were not present;

House counted, and, 40 Members being present—

Mr. Mackenzie

It is perhaps a little embarrassing for an hon. Member to have the House counted while he is speaking, especially if he has been on his feet only for two minutes. The benches opposite had very small representation. I counted only seven hon. Members opposite. It is worth pointing out that very few of those who indicated earlier that they intended to speak have remained in their places. Perhaps this is something to which we can look forward as a matter of Parliamentary tactics.

Sir D. Glover

On a point of order, Mr. Deputy Speaker. The hon. Gentleman referred to people who had, he said, indicated their intention to speak. No one can indicate who is to speak except the Chair.

Mr. Deputy Speaker (Mr. Roderic Bowen)

That is not a point of order.

Mr. Mackenzie

I am sorry if I have offended the susceptibilities of the hon. Member for Ormskirk (Sir D. Glover) but a number of hon. Members opposite rose in their places earlier and I took that to be obviously an indication of their desire to speak.

I was saying that in this last year in Scotland unemployment has been kept down to a reasonable level and that some 233 firms with about 20,000 jobs have indicated their intention to set up business north of the Border. It may well be that some people will think that this is merely accidental, but I hope that the Government will continue to foster greater expansion in Scotland as being really worth while.

During the last Session, many right hon. and hon. Members opposite claimed that the Government were reaping the rewards of the legislation introduced by their predecessors. We in Scotland have only one comment on that proposition. Although the Conservative Government were returned in 1951, it was not until about 10 years later that they tackled the problem of unemployment in Scotland by introducing the Local Employment Acts. I was delighted to hear my right hon. Friend the Prime Minister say that he is anxious to bring them up to date. Many of us have had serious reservations about them. I hope that in the next few days we shall hear from the Government precisely what changes they hope to make in giving the Acts more relevance in 1965 and how Scotland can be brought even further from the difficulties seen in years past.

I cannot deny that, to some extent, the Acts have been helpful, but they have not been helpful enough. During the last year the Government have spent between £ 11 million and £12 million on improving the Scottish employment figures and prospects under these Acts and one must acknowledge their action. But I hesitate to think what might have happened had the party opposite been returned to power a year ago when they would have had to deal with the balance of payments problems.

I remember a speech made by a leading member of the party opposite in 1963. He said that the Acts were designed to help growth areas, which would be given preference over other parts of the country. He said that, no matter how growth was curtailed in other parts of the country, places like Scotland would receive special consideration, always allowing that there was ability to do so. I hesitate to think what would have happened if the Conservatives had had to deal themselves with the situation they left in 1964.

It is important to note that most of the work to be done in helping the Scottish people will come from outside Scotland. We want to encourage many newer industries in Scotland— for instance, manufacturers in computers and electronics. The core of the problem in Scotland for a number of years has been too much dependence on primary industries. There has been no great desire to change the structural pattern of industry. We have suffered from our lack of desire to change. But changes are becoming acceptable to the people, including the employers and trade unionists. The Scottish Council has gone out of its way to work with the Secretary of State in bringing more industry and newer types of jobs to the country.

But we have to make sure that our people not only accept the new challenges but are ready to meet them in working in these newer industries. In this respect, our education is not as good as it might be. It is asking a great deal of workers to change jobs and homes and we must be prepared to look at that aspect as well. I remember speaking about education in last year's debate on the Queen's Speech, when I pointed out that Scotland was not a wealthy nation and had to depend on the skills and talents of its people, who must, therefore, be trained properly to take their part in industry and the future development of Scotland.

Although we are anxious to welcome newer industries and projects, we are very short of skilled men. My right hon. Friend the Minister of Labour is well aware of the shortage. When one wants to find a really skilled Scottish engineer one is as likely to find him working in Coventry or Birmingham as in a Scottish shipyard. It is a sad commentary on the last Administration that so many of our people have had to seek work elsewhere.

The education not only of our adults but of our young people is a very great challenge. It is popular to talk about the "brain drain" of skilled engineers or of emigration from Scotland but we must face the fact that, at rock bottom, the problem is one of educating people in primary and secondary schools.

We expect a great deal from young people in the schools. I am delighted to see the reference in the Queen's Speech to the need for comprehensive education and to the desire for the Government to recruit more people to the teaching profession. It does not specify my part of the country, where we operate a different system, but I take it that these measures will apply there as well.

Then we must deal first with the very serious shortage of staff. For many years, we have had the advantage over our friends south of the Border in that we have had a special recruitment scheme which has worked wonders in the last few years, bringing into the profession people who left school early and then had second thoughts, when they took advantage of Government money and the training accorded by technical colleges, colleges of advanced technology and the universities. This process must continue.

I also want reorganisation of university courses which will enable them to give a broad and liberal education but at the same time will not deny opportunity to people who would otherwise take part in working in our schools. I am sorry that I quarrel with some of my colleagues sometimes on this but I cannot accept that married women teachers and retired people are the answer to the problem of teacher shortage in Scotland. The base of this lies, first of all, in the money which we pay to our students, and the money which we give them when they qualify. Many years before I came to this House I was the vice-president of the Scottish Union of Students, in charge of student grants. I remember, time and time again, advocating then that a student was putting in a full day's work and should be treated as an ordinary working member of the community. If we are to do anything for him, and expect much from him in the years ahead, then we must give him a decent wage while he is working, either in technical college or university.

I was terribly disappointed to read about student loans in a newspaper. I am not at all certain who began this exercise in kite-flying, but I am happy to say that it does not seem to be coming from any of my colleagues on the Front Bench. Lest anyone throughout the country gets the notion that there is any support for this idea on these Benches, I want to say that I find it the most pernicious nonsense which I have read for a long time. It is, I trust, not part of the policy of Her Majesty's Government to have education of this kind on hire purchase. We want more students in our universities, and we want many of them to enter the teaching profession. I hope that we will continue, not only to give student grants, but to improve the grants in the years ahead.

I am not certain that the measures which I have suggested will improve the supply of teachers. It is important that we should not think that we can get away with anything other than the spending of a great deal of money. It is also important, when we get these teachers, that we should have very much better buildings and equipment for them. I have read with interest some of the comments made by hon. and right hon. Gentlemen about the need to spend money on buildings and equipment for our primary and secondary schools. I sometimes wish that they would have a chat about these matters with their colleagues who serve on local authorities and persuade them that this is the right course to adopt.

For many years I served on a local authority, and whenever we wanted to spend money on a school building or to buy expensive equipment we found that the members who are supported by those on the other side of the House were always first to protest about the spending of public money in this way. I hope that I shall be forgiven for making what seems to be a purely constituency point. It is not such a point because it applies to the whole of Scotland. In this matter of building we have suffered a great deal in the last few years. We started late and we had a lot of slum schools. Even the previous Administration had a long way to make up. During the last decade, however, there were cuts and this held back our school building programme very seriously.

The present Government are introducing comprehensive schools. This may not seem to tie in with my last point about delaying school building but it has the effect that, whenever the Government indicate their desire for comprehensive education, there must be a reassessment of school buildings, a reappraisal of school means, and this delays the drawing up of plans, in the hands of the local authorities. The local authority of Lanarkshire is most anxious to take part in a scheme of comprehensive education. I hope that the Government will give what assistance they can because a very great responsibility rests upon them to do so, both to provide the local authority with money and to give it technical advice.

Soon we in Scotland expect to receive, from the hand of the Secretary of State, his economic plan. It is a plan which has today been attacked in one of the popular newspapers—before it has been published. It seems to be something of a fashion When any of our economic plans are introduced. I hope that, in introducing the Scottish economic plan, the Secretary of State and his colleagues will be mindful of the need for education and re-training, because it is only in this way that we can make an effective contribution to development in Scotland.

5.25 p.m.

Mr. R. Gresham Cooke (Twickenham)

The hon. Member for Rutherglen (Mr. Gregor Mackenzie) will excuse me if I do not follow him in talking of Scotland. I think that we ought not to let this opportunity pass without congratulating the hon. Member for Ebbw Vale (Mr. Michael Foot) on his brilliant speech. I am sorry that he is not here but I was delighted to hear him call his party back to their first principles, back to their true Marxist origins, and also to throw some shafts of wit upon the scene.

Mr. Eric S. Heffer (Liverpool, Walton)

Will the hon. Gentleman vote for steel nationalisation?

Mr. Gresham Cooke

When the hon. Member catches the eye of the Deputy Speaker, perhaps he will tell us the difference between nationalisation and Marxism. The speech of the hon. Gentleman the Member for Ebbw Vale was rather a relief after the two very dull speeches we had from the Government Front Bench—the Prime Minister yesterday and the Chancellor of the Duchy of Lancaster today.

I thought that the Chancellor of the Duchy of Lancaster made the sort of very worthy speech that one heard in W.E.U. halls from Fabian speakers before the war. I wanted to ask myself, "What has happened during the last 12 months, where is all his bounce, his ebullience, his ' Mr. Toad of Toad Hall' spirit that he used to show us in opposition? Have 12 months of Government ground him down to such a dull and dreary speaker? "Dear me, what it must be to be a member of the Labour Government in such sad days. He told us one thing—he appreciated that we have the second highest standard of living anywhere, and we all know that is due to the 45 per cent. increase in the standard of living that took place during 13 years of Tory Government. In this non-Socialistic budget, for which I can see troubles coming from Left-wing constituency parties which are going to say that the Government are trying to steal their policy, there are matters which will have to be discussed in detail, such as, for instance, the sentence in the Gracious Speech: Legislation will be introduced to lessen the injustice of the rating system and to limit the burden of rates. On behalf of the ratepayers in my constituency I want to put forward three points which I hope we will see included in this legislation. I hope that assistance will be given to those possessing under £10 a week, so that they may be relieved of rates by the Government. I would like to see teacher training and further education taken over by the Exchequer and a new formula created for assessing the general grant, which would assist boroughs such as my own—the grant for the extra assistance that is given for the number of children per head of population. At the moment the extra grant is assessed at 110 children per 1,000 of population. My borough falls just below this figure and does not qualify for a grant. I hope that that is the sort of matter which will be attended to in this forthcoming legislation.

Surely the most important sentence in the Gracious Speech is the one which says: My Government will …develop the policy for …prices and incomes …will introduce a Bill for this purpose, and will continue to develop the policy in co-operation with all concerned. That is the most important pronouncement by the Government. It is the sentence by which the Government will stand or fall in the next year; and, in my view, it will probably fall. We should say to ourselves every morning before breakfast, "Nearly all our reserves are borrowed and we have to pay them back". We have to pay back £1,000 million.

The Government hope that the balance of payments will be all square in 1966. I hope so, too. But over the four years from 1967 to 1970 over £900 million must be repaid under the international agreements. That is our duty. To achieve a balance in 1966, as we still have to cut down our imports, we cannot afford a rise in output next year because we cannot afford the extra imports which such a rise would entail. According to my calculations, in the next four years we can afford only a rise of 2½ per cent. per annum. If we had a bigger rise, we should run a deficit.

We were told by the Chancellor of the Exchequer the other day that public expenditure is due to rise 4¼per cent. per annum in the next four years. In those circumstances, the public expenditure is bound to become a greater percentage of the national output and therefore a greater burden on the taxpayer if, as I believe, we hold output to a maximum increase of only 2½ per cent. up to 1970.

Can the cost of living and wage settlements be contained within the figure which is adumbrated? In 1963 and 1964 they were held to a rise of 4.5 per cent. But, in the third quarter of 1965, the increase had risen to 6.2 per cent. On 31st October the Chancellor of the Exchequer said that earnings were still going up faster than productivity and that in the first eight months they had increased by 8 per cent., which, as he said, is bound to lead to an increase in prices. Therefore, I cannot see how we can maintain present prices or our competitive position in exports in 1966.

A year ago, in the debate on the autumn Budget, in referring to the Secretary of State for Economic Affairs, who was then trying to get the T.U.C. to agree to an incomes policy, I said, "Good luck. Have a try. I wish you success". He has tried. No doubt he finds it very trying indeed. But it is no good being a Member of Parliament with business interests unless one can bring the experience of such business to the House, and I will try to do that quite shortly.

I am associated with a company which uses timber as its main raw material. The directors tell me that the price of timber has increased 22 per cent. in the last year. Much of it is imported and is dependent on world market conditions. The company will find it impossible to maintain its present prices, however much early warning or advance notice is given to the Government.

As the House knows, I am interested in engineering. I examined one company very carefully. Its turnover has increased 10 per cent. in the last year—above the national average—and it was expected to make a larger profit and to plough back more money into its works in the present financial year. But I am now told by the directors that all this extra turnover has been absorbed in additional costs.

I went through those costs very carefully item by item, and I found them very interesting. First, production costs have increased because of the shorter working week and the wages settlement achieved about a year ago in the engineering industry. I discovered that the cost of premises had gone up £2,000 per annum through the increase in rates. Surprisingly, selling costs have increased very considerably— £ 24,000— through increases in salaries, wages, National Insurance, travellers' petrol and increased motoring costs. The cost of distributing the products has gone up by £12,000 because of increased warehouse wages and transport and fuel costs. Local office costs have increased because of increases in wages and salaries and National Insurance. The cost of administration at head office, which certainly was not over-staffed, has gone up too, and financial charges have increased because the borrowing of money is more expensive through the increase in Bank Rate.

In that company costs have increased by £83,000 compared with a year ago, and that sum certainly could not be absorbed. The company had hoped to have £50,000 available for re-equipping at the end of the financial year, but because of the Corporation Tax and the tax on dividends it finds that it has only £16,000 available for that purpose.

In the light of this picture of an average company, I believe that no company could contemplate its future safely and that prices will have to go up. I believe, further, that by March or April next year there will be a surging increase in prices throughout industry. If the Government want to be returned to office, as the hon. Member for Ebbw Vale said, they had better have an election quickly because stagnant production next year and a rise in prices and costs can only mean fewer exports and balance of payments difficulties all over again. That is why the Government will probably fall at the next General Election. The public are very fickle, and a few points lead in the Gallup Poll will soon swing the other way. The public will not stand for a third round of extra taxation, whether in the Budget, by the regulator, or any other way.

We must consider the question of industrial relations. I was very concerned about the 498 unofficial stoppages in the motor industry in the first six months of this year. I was in the United States in September and I was very distressed to find that my own company, Rootes, could have sold in the United States an extra 1,500 cars this summer if they had been available. They were not available because of the number of small unofficial strikes which held up production at every phase.

I acknowledge the efforts of the Minister of Labour in this respect. He has made a start in tackling these problems by appointing Mr. Scamp as a trouble-shooter for the industry. I think that there will have to be legislation whatever party is in power. We shall have to have a system of local or regional industrial courts to which small disputes can be referred for settlement as soon as they arise. If the union cannot enforce the awards, then it will have to suffer a penalty. But I agree that if the breach of the procedure were brought about by a non-member of the union, it would not be fair for the union to have to pay the penalty. But if, as happens nine times out of ten, it is brought about by a union member, the union will have to be responsible.

Finally, whatever party is in power, we shall have to work more efficiently if we are to conquer the balance of payments problem. To bring us into line with the rest of the world I should like to see one small reform. I should like every industrial and commercial office in this country to be open by 9 o'clock in the morning and the boss in his chair shortly afterwards. Too often I telephone offices and the faithful secretary says, "Mr. So-and-So is delayed by fog". Delayed my foot—he did not start out early enough! In the United States one can contact anybody by 9 a.m. and some even by 8.30 a.m. If we are to join the Common Market we must remember that we are one hour behind the Continent in winter in any event, and if we do not start telephoning the Continent until 10 a.m. we have lost two hours of telephoning time. This small step of a half-hour earlier start in offices would increase office productivity by 10 per cent. It could be done by that reform alone.

Although at the moment we are in temporary calm and although the public thinks that things are fairly satisfactory, a storm can blow up again at any time, and probably will. The passengers will not be happy if the captain tips them into a rough sea such as is coming shortly, even if the ship is said to be unsinkable. Unless further drastic steps are taken now to improve our exports position, we shall certainly be in a rough sea of rising prices in the next six months and there will be trouble ahead for the Government.

5.42 p.m.

Mr. Eric S. Heffer (Liverpool, Walton)

I have a certain amount of sympathy with the Opposition this afternoon because it must be exceedingly difficult for them to argue any case at all. We have heard a great deal from them over the past 12 months about the broken promises of the Labour Government, but it will be exceedingly difficult for them to argue along those lines in the next 12 months. For example, there was the Airey Neave Bill. I wonder what will happen to that line of argument.

Mr. Iremonger

On a point of order. Is it in order for an hon. Member to refer to another hon. Member by name?

Mr. Deputy Speaker

It certainly is not in order. I am sure that the hon. Member for Liverpool, Walton (Mr. Heffer) will be only too glad to correct himself.

Mr. Heffer

I was referring to the title given to the hon. Member's Bill in the national Press and I apologise for referring to it in that way. But the hon. Member and his Friends will find it exceedingly difficult to build up any sort of case along the lines which they have followed in the past 12 months. Any intelligent person understood that the Government could not possibly carry out their entire programme in the first 12 months, and yet week in and week out we heard demands from the Opposition benches that the Government's full programme should be carried out within the first few months of the Government's existence. Every time that we failed to carry out some promise or deferred it for a period because of the economic problems which we inherited, there was a great outcry from the Opposition benches. Now they will find it exceedingly difficult to argue along those lines.

May I take up one or two points made by the right hon. Member for Leeds, North-East (Sir K. Joseph) in relation to trade unions. Much nonsense is spoken in the House by people who have never had any experience of the trade union movement. I warn those people who are suggesting that we can modernise our trade union movement on the basis of legislation that if they pursue that to its logical conclusion they are pursuing an exceedingly dangerous path. One hon. Member spoke of the number of trade unions in this country, he said that there were far too many trade unions. This I accept, but we cannot reduce the number of trade unions in the country on the basis of legislation. It can be done only on the basis of the trade union movement itself reducing its numbers by negotiation, amalgamation and agreement.

Reference has been made to Germany. Let me point out that in 1933 the trade union movement in Germany was destroyed and in 1945 the Germans were able to sit down and plan their trade union movement. They could start from scratch, and they could therefore decide to have a number of industrial unions, which we cannot possibly do—unless it is suggested that we wipe out the existing trade union movement which has been built on 150 years' experience of the British working class. I urge hon. Members to show some sense on the question of trade unions.

Let us consider the problem of unofficial strikes. May I refer to that section of the Gracious Speech which deals with the docks? I am sure that all hon. Members with any knowledge of the docks industry—and some of us have a great deal more knowledge of it than others because we have worked in industry for many years—welcome the Devlin Report because it spotlights the problems in that industry which we have known over the years.

But we must get the question of unofficial disputes in the docks in perspective. The industries in which there are more unofficial strikes than elsewhere are those in which there is casual employment—for example, the docks, the building industry and the shipbuilding industry, leaving aside the very special problems existing in the motor car industry. If we leave the motor car industry aside, we come to the conclusion that unofficial disputes are rife in the industries in which there is casual employment, in which a worker has no definite employer for whom he works for any length of time. He may work in the docks for one employer today and for another employer tomorrow. The situation is exactly the same in the building industry. A man works perhaps for six months for an employer, and then the job finishes and he is out of work. He has no loyalty to that employer, nor has the employer any loyalty to that worker. If we are to get rid of the problems of unofficial disputes in the docks, the building yards and the shipyards, we shall do so only on the basis of introducing measures which will end the casual nature of the employment of the workers.

Only this week there was a dispute in one of our docks in which the workers were concerned with the type of cargo which they were handling. How can that be referred to some committee or commission which meets in London? It must be settled at the point of production. It must be settled immediately. We can do this only on the basis of proper trade union organisation, proper negotiation and discussions, and the immediate reaction of the employer. The request in this case was that the workmen should have overalls. How are the men to act? Are they to work on this dirty cargo in their normal clothes or to stop working immediately until they are given overalls? The answer to unofficial strikes is to get rid of the problems which create them. This is the important question which hon. Members must understand. I speak from bitter experience of many unofficial disputes in the building industry precisely because of the conditions we had to deal with, and which could not be referred to a district committee or to a national committee because the time factor would not allow it.

Captain Walter Elliot (Carshalton)

I should like to ask the hon. Member a question. He said we could not reduce the number of trade unions by legislation. He may well be right, but when we were arguing about the National Plan the First Secretary of State, talking about the docks, said that he intended to reduce the number of dock labour employers by restricting the issue of licences because he thought that would be helpful. Does the hon. Member agree with that?

Mr. Heffer

Certainly I do, but I would take it a step further. I think we are only tinkering around with the question of the docks unless we actually come forward with some concrete proposals for bringing the docks under public ownership. I believe that the dockers ought to be working not for a reduced number of employers but for one employer, the Government, through the public ownership in some way of the docks. This is the answer to the problem which the hon. and gallant Gentleman has raised with me.

Captain Elliot

rose—

Mr. Heffer

With due respect to the hon. and gallant Member, I will not give way. There are many other hon. Members who want to speak and they will not forgive me or him if we take up too much time.

I believe that the docks must be brought under public ownership for these reasons. Firstly, there is a need for the modernisation of the dock industry. How are we going to get the type of capital investment for the building of new docks and new berths and also for new machinery and equipment required in the docking industry unless we have a national employer who can definitely ensure the investment is there? I think this can best be done on the basis of the public ownership of those docks. I think also that public ownership is required in order that the workers can get proper security and decent conditions. In the Liverpool docks, even today, some of the workers are forced to use toilets which are nothing better than—a sort of open—

Mr. Simon Mahon

Hole in the ground.

Mr. Heffer

That is right. I was trying to explain without being too crude about it. One cannot possibly be anything more than crude about the sort of conditions the workers have at Liverpool docks, even today, and despite all the efforts being made by the Mersey Docks and Harbour Board, improvements cannot be pushed forward at the speed required unless we get proper modernisation of the docks through the public ownership of those docks.

I welcome the Queen's Speech not only for the type of legislation envisaged in it in relation to housing finance, which will be very welcome in the city of Liverpool, not only because of the fact that the rate burden is to be lifted from those hit worst by the increased rates, not only because of the various suggestions and proposals for pensions increases, but particularly because there is the point about legislation which will be introduced in relation to the dock industry. Those are the positive things which I see in the Queen's Speech. I think there is no Member on this side of the House who will not agree that we could not possibly have expected from the party sitting opposite the type of positive programme which is outlined in the speech.

But having said that, having said I welcome the speech, having said that I think it is positive programme, I want to end by drawing attention to the point made by my hon. Friend the Member for Ebbw Vale (Mr. Michael Foot), the fact that steel nationalisation is not included in the speech. An hon. Gentleman opposite got up when my hon. Friend was absent and said that he congratulated him on his speech. The point I wanted to make to him then was that I hope he will take his congratulations —and all the other hon. Members on that side who congratulate my hon. Friend—to the length of actually voting for steel nationalisation when it is introduced into the House of Commons, as it will be in future legislation.

Several Hon. Members

rose—

Mr. Heffer

I am sorry, but I am not giving way any more.

It is quite clear to me that the reason why steel nationalisation has been left out of this speech at this stage is the peculiar political situation which we have in the House at present. We know that we have a small majority; we know that the Liberals are opposed to the nationalisation of steel, as is the Conservative Party; we also know that, unfortunately, there are one or two of my hon. Friends on my side of the House who indicated their opposition to steel nationalisation. This places any Government in a very difficult situation about this measure.

But having said that, I equally agree with my hon. Friend the Member for Ebbw Vale that we ought to go to the country early, and I say this as someone holding a marginal seat, having taken it off the party opposite at the last election. I say this because I think we should put not only the programme we are pushing forward but equally steel nationalisation as part of our programme before the people of this country, so that we can be returned with a much larger majority than we have at present so that we can put through all the basic reforms which are required in the structure of our industry. For the life of me, I cannot accept this position of leaving out steel nationalisation at this stage. I understand the problems which the Government have. I sympathise with them in those problems. I think any man of intelligence must. Nevertheless, it seems to me that we should have included it in the Queen's Speech so that it is part of our general programme of advance in the country as a whole.

Therefore, in conclusion, I would ask this House, when the Amendment is put down, to consider the Amendment with very great gravity—

Mr. Iremonger

Hear, hear.

Mr. Heffer

— but not with hypocrisy, because if anything maddens me it is the hypocrisy of the hon. Gentlemen opposite who say "Hear, hear" on the question of steel nationalisation when they have no intention at any stage of ever supporting it. They have never at any time supported any measure of public ownership because they believe in the power and privileges of that small section of employers who control the means of production. I personally believe in Socialism, and my brand of Socialism believes that the only way we shall ever build a just society, a classless society, a society where the ordinary working man will get his real benefits in this world, is when we take the power and privileges away from the vested interests of the hon. Members on the other side of the House.

5.59 p.m.

Mr. T. L. Iremonger (Ilford, North)

I am very glad indeed to follow the hon. Member for Liverpool, Walton (Mr. Heffer). I should, in any case, I think, have felt that the House would want one to intervene on a point of order, to inquire whether in fact a charge of hypocrisy cannot be framed in a way which comes within the rules of order. But I would not want to take a stand on a petty point like that. As a matter of fact, I sympathise with him. I know what he meant. He thought that I was saying "Hear, hear" to the proposition that steel should be nationalised, which would be extremely hypocritical. I can use the word because I use it only hypothetically about myself.

The fact is that I was applauding what I thought was the hon. Gentleman's intention of putting down an Amendment. What I wanted to say when I was trying to intervene was that I hoped that he and his hon. Friends would co-operate with other hon. Members not necessarily on his own side, because I am quite sure that we could draft an Amendment, for which we would be able to vote, deploring what the hon. Member for Ebbw Vale (Mr. Michael Foot) called the defection of the Prime Minister from the principles of Socialism or Marxism which are laid down in Clause Four of the Socialist Party constitution. That was the defection—which was, I would not say hypocritical, but cautious—from the pledges that he made not only to the electorate but also to his own party.

I sympathise very much with the hon. Member for Walton, and I am very glad to follow him. He is in the running for the position of shop steward for back benchers in the House of Commons with his interest in Parliamentary reform.

Mr. Sydney Silverman (Nelson and Colne)

Would it be right to assume that the hon. Member for Ilford, North (Mr. Iremonger) is in favour in this place, though nowhere else, of unofficial strikes?

Mr. Iremonger

Certainly I am in favour of unofficial strikes in this place, and any co-operation which is wanted by hon. Members like the hon. Gentleman for Walton in unofficial strikes will be gladly given by me. I exclude from them the hon. Member for Nelson and Colne (Mr. Sydney Silverman), because he is far too old a hand. He has been ground down.

However, there is no question in my mind of unofficial strikes when I refer to the hon. Member for Walton as being in the running for the position of shop steward for back benchers, because, in matters of Parliamentary procedure, he is a gaffer's man. He wants to reform Parliamentary procedure so as to make life easier for back benchers and so that the Government get their business through without hon. Members being able to fulfil their duties as an Opposition.

Mr. Heffer

I cannot understand why the hon. Member for Ilford, North (Mr. Iremonger) should say that, because I went into the Division Lobbies with him on the question of the Ten Minute Rule Bills.

Mr. Iremonger

I shall shortly be giving the hon. Gentleman an opportunity to go with me into the Division Lobbies on another Ten Minute Rule Bill, which perhaps I might announce now in my own gracious speech. [HON. MEMBERS: "Hear, hear."]

On page 4 of the Gracious Speech there is a very interesting paragraph which says: A measure will be introduced to provide for fuller disclosure of information by companies, including the disclosure of political contributions. That is perfectly fair. I am not against it. However, I propose to introduce a Bill under the Ten Minute Rule at about 4 a.m., the hon. Gentleman will be very sorry to hear, to make that Measure of broader application and bring the whole question of contributions to political parties on to a level basis throughout the whole gamut of society. I propose to introduce a Bill to amend the Trade Disputes Act in a way which will make it compulsory for those who want to contribute to the Labour Party through trade unions to contract in instead of contracting out. When I do that, I am sure that the hon. Member for Walton will be justified in joining me and my hon. Friends in the Division Lobbies. We do not mind staying up, because we are used to it, and we shall be here whatever time it is.

Mr. Paul B. Rose (Manchester Blackley)

Would the hon. Gentleman state whether, in his Bill, there will be permission for shareholders to contract out as well?

Mr. Iremonger

That as a very fair point, and no doubt the hon. Member for Manchester, Blackley (Mr. Rose) could co-operate in drafting the Bill. What he says is perfectly fair, though I suggest that shareholders only have to sell their shares, and they will not lose their jobs because they sell their shares. That makes it slightly different. I concede that the hon. Gentleman's point is a perfectly fair one. I am for fair shares all round.

I want to make one further reference to the hon. Member for Walton, who made a very sincere speech and upbraided us for thinking that 'the Government whom he supports are not going to fulfil their promises. They are very likely to do everything that they have said in the way of legislation, but the promise that I do not think they will fulfil is the one which is crucial to the whole Gracious Speech, which says on page 2: My Government's aim is to develop a soundly based economy. That is a promise which I am afraid the hon. Gentleman's right hon. Friend will fail to fulfil, and that is why he will go out.

I want to refer for a moment now to the hon. Member for Ebbw Vale, whom I am very glad to see in his place. He made one of the great speeches of his Parliamentary career, and that is no idle compliment, if he will forgive me for making it. He fills the House when he gets on his feet, not only because the Left wing of the Labour Party come in to back him up, but because hon. Members in all corners of the House take delight in the artistry of his craft. The areas of our philosophies do not coincide at very many points, but the points where they do are very important. We both have a love for the English language which I hope goes beyond pedantry, a great admiration for Jonathan Swift and William Hazlitt, and a passionate belief in the importance of the rights of the House not being eroded by right hon. Gentlemen on Government benches. On all those points, the hon. Member for Ebbw Vale and I have an informal alliance.

I was glad to hear him say, because it did credit to him, that his right hon. Friend must put the nationalisation of steel into the next Gracious Speech or, as he said, he would be denying the country what he himself had said was a paramount need. I think that the explanation is that we will not have another Gracious Speech and that the present one is the last one. It is my belief that the right hon. Gentleman intends to go to the country in October, 1966, for that very reason.

The House would do well to take note of what the right hon. Gentleman the Prime Minister said in Bristol on 4th September when he was speaking to some 1,800 people. He was wrong in one respect, but he said quite frankly that by October, 1966, he would have carried out the programme that he had put before the country. The one exception is the nationalisation of steel. So the question arises, will he put the nationalisation of steel into the Labour Party's election manifesto? I hope that he does. He is quite right to put it in if he believes in it. If he does not put it in, it is either that he does not believe in it or, as the hon. Member for Ebbw Vale says, sheer expedient abandonment of principle, because he wants a majority more than he wants Socialism.

I can understand that. I want a majority more than I want Socialism. But then I do not subscribe to Clause Four of the Labour Party Constitution. The fact is that nobody wants the nationalisation of steel, except the hon. Member for Ebbw Vale and one or two of his Left- wing friends who do not command as much influence in their party as they ought to. On their merits and on their talents, I have always thought that they were at the very highest level of their party.

As one of my hon. Friends said, the fact is that the Prime Minister is abandoning Socialism. He is trying to creep away from it. I do not blame him, but he is leaving the Left-wing of the Labour Party in the lurch, and the pathetic thing is that when they squeal he does not take any notice at all. When they squeal about Vietnam, about immigration or about steel, they are treated with absolute contempt, which their great oratorical talents do not observe.

I was particularly sorry to hear the hon. Member for Ebbw Vale say that he expected to see a Labour Government in this country for the rest of his life. I should hate to think that we were to hear so very few more speeches of the quality of the hon. Gentleman's speech this afternoon. I should be very sorry indeed if he had such a short life. As a matter of fact, the more he goes on television and propounds the doctrines in which he believes, the more people vote Conservative and abandon the Labour Party.

I hope that the hon. Gentleman will put down the Amendment which he has promised to table, in the frank terms in which he spoke tonight. Let him not put the Amendment in the terms that this House wants to nationalise steel. I could not subscribe to that. Let him go to the core and root of the matter and say, as he said at the Labour Party conference, that this House deplores the sham and the expediency and dishonesty of politicians which brings the institution of Parliamentary democracy into contempt. Those were his words. That is what he said at the Blackpool conference, and a very moving speech it was.

A passage on page 4 of the Gracious Speech refers to the pensions of retired members of the public services. I must apologise to the right hon. Gentleman the Chancellor of the Duchy of Lancaster. I may have missed something that he said about this, but if not I hope that whoever replies to the debate will explain the Government's intentions in respect of officers' and officers' widows' pensions. I do not feel that I can speak with any great pride in this matter, and I do not think that any of my right hon. or hon. Friends can either. I am afraid that the fact of the stubborness and meanness of the Treasury, and the fact of the small number of people involved, has meant that the older officers and officers' widows have had about as dirty a deal as any section of the community.

I hope that the Government will do something about this. I know that it may involve a certain departure from very strict principles which can be expounded with lucidity and logic from the Government Box, but so did the increase for the 10s. widows. It was a complete betrayal of all the principles of the Beveridge Report, as the National Advisory Committee pointed out when the proposal was turned down again and again, yet the Government managed to do it. Let them stretch a point for these people who I do not think have had a fair deal.

Mr. Sydney Silverman

From whom?

Mr. Iremonger

From all of us. I think that the hon. Gentleman knows me well enough. We are all toads beneath the harrow. [Interruption]It is a biblical expression. I think that it comes in Job, but I am not sure. No doubt the hon. Gentleman will find the reference there. We are all toads beneath the harrow.

I was also disappointed with the reference in the Gracious Speech to what I had rather been led to imagine was going to be some wonderful fundamental rethinking of the whole structure of the Welfare State. I do not think that the statement that Measures will be laid before you to provide supplementary national insurance benefits and so on, presages any attempt to meet the fundamental need now to look again at the principles underlying the Beveridge Report, on which the Welfare State is based.

The Beveridge Report was conceived in an age of poverty, unemployment and declining wealth. It is totally unsuitable for application in a period of expansion and of comparative wealth—wealth, at any rate, as compared with the rest of the world. It is as unsuitable as an over- coat in the middle of summer, and it ought to be rethought.

Mr. Sydney Silverman

I am not quarrelling with the hon. Gentleman's view that the time has come to reconstruct a great deal of the Beveridge Report, but is not he mistaken in saying that it was conceived at a time of unemployment? Was not it conceived during the only period when we had 100 per cent. employment under a Conservative Administration, and in the expectation, not of a decline, but of an expanding economy at the end of the war?

Mr. Iremonger

I do not think that that intervention is quite worthy of the hon. Gentleman.

Mr. Silverman

I will make another one if the hon. Gentleman likes.

Mr. Iremonger

The hon. Gentleman can try again, but he knows what I mean, and he is far too perceptive and honest not to appreciate it. The Beveridge Report was conceived in terms of the 'thirties, and if the hon. Gentleman says that it was conceived in terms of an expanding economy—

Mr. Silverman

It was produced in 1944.

Mr. Iremonger

But the whole thinking was conditioned by the philosophy and the economic evils of a contracting economy. When the hon. Gentleman says that it was conceived in anticipation of an expanding economy, he must realise that Beveridge himself said that he expected a minimum level of 3 per cent. unemployment.

Mr. Silverman

In Beveridge's view a figure of 3 per cent. unemployment meant an expanding economy. In the 'thirties we did not have a level of 3 per cent. unemployment.

Mr. Iremonger

My hon. Friend gives me a figure of 8 per cent. I thought that the best Beveridge hoped for was 3 per cent., and he anticipated the possibility of 8 per cent. The hon. Gentleman is not facing the real point. Perhaps we could just agree on this, if one goes to the extreme point of the argument, that Beveridge did not conceive a Welfare State as operating in a period of acute labour shortage, and that is what we have. He did at least conceive it as operating in a period when unemployment was a factor. And if the hon. Gentleman says, "What is 3 per cent.?", he should recall the howls of outrage there were when it was 1½per cent. under the last Conservative Administration. I think, therefore, that my point is a fair one. If it were not, I would concede it to the hon. Gentleman, but I do not think I should.

I have been interrupted somewhat, but I do not think that the House would entirely forgive me for being tediously long, and I will therefore restrict my closing remarks. But I cannot resist saying something to the Minister of Labour, with reference to this paragraph about My Government will strengthen and develop the policy for productivity, prices and incomes which they have agreed with management and unions. They will introduce a Bill for this purpose, and will continue to develop the policy in co-operation with all concerned ", I will not follow the hon. Member for Walton in using an unparliamentary expression, but what a lot of humbug this is. The Minister of Labour had to go to the Trades Union Congress and fight for his Government's life when he tried to get the Congress to accept proposals concerning the legislation which is foreshadowed in the Gracious Speech. He told the T.U.C. that the trade union movement had to face three things—co-operation, compulsion or disaster.

He has obviously abandoned all hope of co-operation. What he meant by compulsion was legislation, and here we have legislation to try to enforce the prices and incomes policy. I think that it will be a vain hope. At any rate, it is a retreat from what the right hon. Gentleman hoped to be able to achieve, and I do not think that he will be able to stop his retreat there. I think that he will go on further to the disaster that he foretold. He did not say what it was, but I know what he must have been thinking, because there is only one possible interpretation. What he was thinking was that the survival of our economy depends upon our exports exceeding our imports.

It that is to be achieved certain other things must follow. It is necessary, because of a balance of payments being a prerequisite, and if that is to be achieved it follows that there must be restraint in the spending of spendable income by the consuming public. If this does not come by co-operation or by compulsion it will come by disaster, and the word "disaster" used in the context of the appeal to the trade union movement by the Minister of Labour—however much he muffles it—means that the Government know quite well that they will have to deflate the economy to make up for the lack of productivity and the lack of restraint that we will have failed get by co-operation or compulsion.

That is where the hon. Member for Walton is wrong when he says that there will not be any broken promises. That is where I am afraid I am right when I say that the one broken promise, for certain, will be the promise to develop a soundly-based economy. All this business about compulsion is spitting in the wind, because there is a fundamental imbalance in the economy, and no amount of discipline or example that this Government show any signs of giving will remedy it.

The only other thing that I wanted to do was to congratulate my right hon. Friends on the proposal that they have made for legislation to control the trade union movement. I agree with the hon. Member for Walton that legislation is not appropriate in getting at the root of the problem. I hope that he will tell his right hon. Friend the Minister of Labour that.

Mr. Speaker

Order. The hon. Member should address the Chair.

Mr. Iremonger

I should have added the words "through you ", Mr. Speaker. I hope that the hon. Member will tell his right hon. Friend that legislation is no good in these matters. The one piece of legislation that I would like to see introduced, and which I am glad to see that my right hon. Friends propose to introduce when they come to power, is a Measure to regulate the procedures of the trade unions.

I modestly congratulate them on this. The hon. Member for Nelson and Colne (Mr. Sydney Silverman) will remember that I proposed this very thing in a Ten Minute Rule Bill. I was allowed to do it then before everybody had gone to bed. I proposed it on 30th July, 1957, and I had considerable lack of support from hon. Members opposite who were then on the Opposition benches. I had vocal dissent from them and I had no very great sign that the desirability of this idea had burgeoned in the minds of my right hon. and hon. Friends. I am glad that it has done so now. I think that we shall have that Measure before the House, from my right hon. Friends when they are sitting on the Government benches, and that will be before we have any fulfilment of the prime promise contained in the Gracious Speech, namely, that of developing a soundly-based economy.

6.26 p.m.

Mr. David Ginsburg (Dewsbury)

Apart from his comments towards the end of his speech, the hon. Member for Ilford, North (Mr. Iremonger) gave us a fluent but rather mischievous oration. I doubt whether my hon. Friend the Member for Ebbw Vale (Mr. Michael Foot) will fall for any of his embraces.

The hon. Member for Ilford, North in the more serious part of his speech, basically ignored the Government's policies and proposals and the immediate problems facing the country. In contradistinction to him, I welcome the Gracious Speech. My reasons for doing so are cogent ones. First, after 12 months in office the Government have a solid record of achievement behind them in circumstances that were far from easy. Second, the Gracious Speech sets out important proposals both with regard to the modernisation of our economy and the improvement and development of modern social services in this country. I have no doubt that my constituents have a greater sense of economic security now that the Labour Party is in office, and there is a far greater feeling of confidence and hope in the country as a whole than there has been for a long time.

However, let us not be complacent when we speak of the nation's welfare services. There is still a lot to be done. My right hon. Friend the Prime Minister and today my right hon. Friend the Chancellor of the Duchy of Lancaster spoke about the Government's priorities —yesterday in housing and today in social security. The steps outlined will make an enormous difference to the lives of our people.

But all this, as the Government must know, can be only a beginning. I want to draw the attention of Ministers to a very important article in the August issue of the National Institute's Economic Review entitled "Social security in Britain and certain other countries". I will read two extracts from its conclusion. It says: The British system of social security compares most favourably with other countries in the comprehensiveness of medical care provided under the National Health Service and of the minimum level of subsistence provided under a centralised National Assistance scheme. The social insurance benefits and family allowances are by contrast much less adequate. It goes on to say: The proportion of national resources devoted to social security is very much lower in this country than in any of the Common Market countries: taking cash benefits alone the ratio is not more than about half the level in Germany. Clearly, the introduction of wage-related sickness and unemployment benefits, as proposed in the Gracious Speech, and which we all welcome, is very important, but even more important is the comprehensive review of social security which the Government are undertaking, and especially the arrangements for paying retirement benefits. I hope that that issue is kept in the forefront of Ministers' minds.

I will contrast my warning words to my right hon. Friends with some comments about the speech of the right hon. Member for Leeds, North-East (Sir K. Joseph), in which he seemed to commit the Conservative Party to an extraordinary scheme of social security. It struck me as being half-baked. It would appear that the Conservative Party has jettisoned its wage-related pensions scheme, a wage-related scheme, albeit a limited one, which was introduced only seven years ago by a Conservative Administration. They now propose to jettison it.

The scheme which they suggest instead seems to me to fly in the face not only of academic experience in this country but the best practical experience in social security in Europe. For example, where in the scheme now proposed by the Conservative Party is the hedge against inflation? Incidentally, it is remarkable that at the moment when the Leader of the Opposition is committing the Conservative Party firmly to going into Europe—which must mean harmonising social security arrangements with Europe, for which there is a very powerful argument—the right hon. Member for Leeds, North-East, the spokesman of the Conservative Party on social security arrangements, takes the Conservative Party's social security philosophy right away from Europe into a scheme which I find it difficult to comprehend. The public will find it difficult to comprehend as well, because we have heard nothing this evening in the right hon. Member's statement about what will be the rights of existing contributors to the scheme which was passed by this Parliament six or seven years ago.

The House is agreed that the key to everything today is the economic situation and the Government's ability to handle it. There has unquestionably been a great improvement. The Prime Minister told us yesterday that we have halved the deficit both on the current and the capital accounts. The latter achievement, which has not been referred to so much, is particularly important, and even remarkable, when we bear in mind that some of the measures which the Chancellor of the Exchequer announced in April concerning the capital account have not yet begun to bite.

The Government can take pride or comfort from the statement in the Economist of this weekend. Although the Economist is not noted for its friendliness to the Labour Party, it said in its leader headed "First Term Report": By contrast, Labour's achievement in reducing the long-term capital deficit has been considerable, and it is doubtful if the Conservatives would have done half so well here; at any rate, Labour's measure to stop excessive long-term investment overseas had to be fought through against opposition from orthodox City opinion almost into Lord Cromer's last ditch. As we have heard, the Leader of the Opposition is still not willing to accept his party's responsibility for the balance of payments crisis of the autumn, 1964. He claims that he has done some research into the Prime Minister's speeches which suggests to him that the Prime Minister was aware of the way in which things were moving. He claims that the Labour Party exaggerated the economic crisis. I, too, have done some research—into the speeches of the Leader of the Opposition and the speech of the right hon. Member for Barnet (Mr. Maudling) at the time of the 1964 Conservative Budget. In my reading of HANSARD, I found evidence of appalling complacency. It is apparent, from a rereading of the right hon. Member for Barnet's Budget speech in 1964, for example, that he knew and stated clearly that we would be in certain difficulties over our overseas investment. But the right hon. Member for Barnet was not so rash in his statements as the Leader of the Opposition, who tried in his speech to spirit away the import gap— in this case, too, I have reread the right hon. Gentleman's speech—by arguing that imports were steady at the beginning of 1964 and that the trend for our exports was a rising one. The emerging facts did not justify the statistical exercise of the present Leader of the Opposition. Action was required to defend the balance of payments: it was not taken by the previous Government and this Government have taken it.

Nevertheless, we should not pretend that the problem we face today is out of the way. The gap must be closed and a surplus built up. Whereas I feel reasonably confident about the capital account —indeed, I think there should be a still further improvement—there are, as we must admit, serious problems over the current account. We cannot continue to rely on the surcharge as an indefinite wall of defence, especially if we mean to build bridges to Europe. Continuing action is necessary, both to stimulate exports and to assist import-saving industries.

This week The Times criticises the Government for what it terms their "interventionist philosophy ". Without intervention, this Government would very easily find themselves in the situation in which the previous Administration found themselves in 1964. The Chancellor of the Exchequer is under some pressure to let production rise, in case there is a risk of demand deficiency later this winter. Perhaps he should relax a little; but when the relaxation comes it must be coupled with measures and action to make industry more efficient.

Some steps are outlined in the Gracious Speech. I hope that the Opposition will not attack these measures as either doctrinal or interventionist. Indeed, many of the proposals were canvassed by the National Economic Development Council in its pamphlet "Conditions Favourable to Economic Growth", published in 1963; proposals dealing with an incomes policy, regional planning, and many other, subjects. However, it is interesting to note that it was left to a Labour Government seriously to implement the work which N.E.D.C. undertook under the previous Administration.

In the planning debate last week, my hon. Friend the Member for Birkenhead (Mr. Dell) spoke about the need for mergers and for larger units in the economy if British industry is to compete. I wish this evening to carry his views further as they relate to exports. Larger units are important, not only for efficient production, but—what is vital for the country at present—for marketing overseas. The small and medium-sized firms, of which there are many in my constituency, cannot involve themselves in the overheads of an international marketing operation.

I agree that many steps forward have been taken by the Government in recent months in stimulating and helping exports, and the results are showing in our better export performance. But to my mind the incentives given do not go far enough. The present chairman of Marks and Spencer, a man whose ability and success needs no advocacy from me, referred in a speech on planning which he made as long ago as 1933, over a generation ago, to the scope for industrywide export corporations, particularly for the purpose of exploiting new markets and for acting as a channel between overseas selling and production at home. I hope that the Government will look hard at proposals of this kind, because the logic in the argument which was used then is even more valid today.

I should like to end on perhaps a rather different note. Planning the economy needs the working out of a new relationship between Government and industry. This is coming about. There is bound to be intervention by the State, and we must not be ashamed to say so. Government inevitably extends its frontiers. That is why all the time we must seek to redress the balance on behalf of the individual citizen. Therein lies an important part of the job of the House and our job as hon. Members. I am therefore particularly glad that the Govern- ment have made proposals for a Parliamentary Commissioner for Administration. The ombudsman, as he is popularly called, can play a special part in preserving and enhancing the balance between liberty and planning.

6.42 p.m.

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

I should have thought that if the hon. Member for Dewsbury (Mr. Ginsburg) had wished to carry out his researches properly he need have gone no further than his own Government's White Paper on the balance of payments which was issued at the time of the Budget this year. It is high time that the Government read their own documents and told us either that the figures in those documents were wrong or that they were right.

The facts were published in the statement in the White Paper, and I have read them so often in the national Press that I thought that even some hon. Members opposite would have taken some trouble to find out about them. In the last financial year to the end of March, on visible and invisible account, on private account, this nation earned a surplus of £57 million. This is published in the Government's White Paper. I drew attention to it during my speech on the Budget. I challenged the Chancellor of the Exchequer to argue against it and he was unable to do so because it is a fact that on visible and invisible account, on private account, this country earned a surplus in the financial year of £57 million.

The deficit was made up of about £420 million overseas expenditure on military matters, about £160 million on capital account for the oil companies, and about £250 million repayment of debt and aid to under-developed countries—incidentally, partly incurred by the previous Labour Government. This was all on capital account. It totalled roughly £804 million. When the surplus is taken into consideration, we were in deficit on the year to the extent of £744 million. Surely nobody will deny that figure. It has never been denied that there was this deficit on the year.

What have the Government done about it? Have they reduced military expenditure overseas? No. Have they reduced their aid to undeveloped territories? No. Have they reduced their overseas payments of debt? No. What they have done is to restrict overseas investment on capital account, which is eating the seed corn, because it is from our investment overseas on the long-term that we bring back dividends to this country from which we pay for our necessary imports.

To say that steps taken by the Government will improve the balance of payments this year is absolute poppycock. There is nothing which the Government have done this year which in this financial year will improve the balance of payments by a penny. What will happen is a reduction in the balance of payments deficit by about £400 million for two reasons which have nothing whatever to do with Government measures. The first is that in the last financial year the oil companies spent about £ 160 million on new investment overseas. This will not recur in this financial year. Secondly, there was considerable stockpiling by industry during the last financial year in anticipation of restrictions to be imposed if a Labour Party Government were returned to power. This will not recur.

These two items alone will provide an improvement in the balance of payments deficit of at least £ 400 million, and it will not be until the next financial year that we shall begin to see any improvement or otherwise from measures taken directly by the Government. Indeed, it could well be that as a result of measures taken by the Government in this financial year there will be an additional charge on our reserves because the very high interest rates which have ensued throughout the whole of this year— and which show no sign of being eased before the next Budget— cause a very big drain on our reserves.

The Gracious Speech is not a speech for a dynamic or thrusting Britain. This is a standstill programme which is putting superficial things in the shop window in the hope that a guillible public will be attracted. There is nothing in it of real consequence to assist us in developing the economic life of the country. It is the result of vain promises in a preelection period and incompetent performance while in office. It must be judged against the backcloth of the past year.

Let us examine the Prime Minister's speeches, pre-election and during this Parliament, and let us see who is the guilty man in this story. The hon. Member for Dewsbury said that he had done a lot of research into speeches. He has not looked at the Prime Minister's speeches. The suggestion that there was some concealment of all the facts of our financial situation before the election does not bear examination for the simple reason that in the Government publication "Economic Trends", of 30th September, 16 days before the General Election, the balance of payments position was clearly set out.

The Labour Government 16 days after assuming office, published a White Paper on this subject which confirmed the figures which had been given in the White Paper on Economic Trends and added the assurance that there was no undue pressure on resources calling for action". This was two weeks after assuming office. They said that there was no strain on the resources calling for action.

Five weeks later the Prime Minister said in the House: We are dealing with a situation where what matters is not what our trade and payments position is but what people overseas think it is. He went on in this statement: The House will agree that, speculative expectations apart, there is nothing in our current economic position which justifies these widespread desires to convert sterling into other currencies."—[OFFICIAL REPORT, 23rd November, 1964; Vol. 702, c. 931.] Nothing in our position to justify the movement taking place overseas?

A few weeks later we ran into real trouble because of the stupidities of the Chequers weekend meeting and the panicky way in which the Government raised the Bank Rate. The Prime Minister then said: The fact is…that so far as the trade gap is concerned…there were reserves and borrowings more than adequate to meet this, but in the course of the past week there has been this new development arising from confidence factors…"—[OFFICIAL REPORT, 23rd November, 1964; Vol. 702, c. 933.] Lack of confidence in whom? In Great Britain? No—lack of confidence in the Prime Minister and his Front Bench colleagues. This was why at that time and in the subsequent months the Government saddled this country with an additional £1,100 million of debt and £30 to £40 has been put round the neck of every man, woman and child in the country. This is where the Government will fall down. All these proposals for the relief of rates and so forth are all very well, but they must be paid for by somebody and they can be paid for only out of a prosperous economy.

Mr. Ginsburg

If the Government have been so inefficient in the managing of our external economy, can the hon. Member explain why the £ is at a far higher level today, and indeed has been for many months, than it was a year before the Conservatives left office?

Mr. Cooper

That is a simple question to answer. Something like half of the trade of the world is done in sterling. A devaluation of the £ by any amount would be a disaster all over the world, and the standby loans and the extra facilities which have been granted to this country have not been given by foreign bankers or countries because they believe in the Labour Government and the policies pursued. These are nothing more than an insurance policy for themselves, to protect themselves against any further idiocy by this Labour Government.

The Prime Minister said on 17th October, and this was really quite something: A good way of measuring progress is to look at some of the changes which have taken place in Britain's affairs in the past twelve months, changes which never would have taken place if the Tories had remained in power. How true that was. They certainly would never have taken place if we had remained in power. The country had the longest period of a 7 per cent. Bank Rate since 1921. We had the toughest credit squeeze since the 1920s. We had a cut in the educational building programme. We had the greatest rise in taxes since the last Labour Government, and an extra £1,100 million of foreign debts laid on the taxpayers of this country. I agree that none of this would have happened if a Conservative Government had been in power.

We have today the oldest Government, the biggest Government and the most costly Government. Above all, we have the most travelled Government. Hardly a day passes when the Prime Minister and his travelling seraglio, or one or other of his Ministers, are not departing or arriving at London Airport. This Government should be renamed "Wilson's Travel Agencies Unlimited" and the new slogan should be, "Let's go with Labour and see the world", all, of course, on tax-free expense accounts.

The Gracious Speech is nothing but a holding operation, a squalid attempt to stay in power with the help of the Liberal Party. I understand that at Transport House a new hymn is now being published and issued by the Prime Minister. I am told that it is to be sung to the tune of "O God, our help in ages past" and that it reads: I to old Jo will lift my eyes From which doth come my aid, My safety cometh from old Jo Who a Lib-Lab pact hath made. I now come to the Gracious Speech.

Mrs. Renée Short (Wolverhampton, North-East)

And about time.

Mr. Cooper

One paragaph deals with the National Plan and I wonder who the Government think they are kidding with this Plan. If hon. Members travel round British industry, as I do, they will find very few people who have read the Plan. People in industry will certainly not be impressed by what the First Secretary says about future expectations in trade and industry in this country over a period of five years. Industry is busy trying to plan itself for a year ahead. It is subject to all sorts of overseas problems which are way outside the considerations of this or any other Government.

If we can refer to the National Plan as nothing more or less than guidance and we do not regard it as something like the laws of the Medes and the Persians it might prove to be of some help, but the Government take a figure of 25 per cent. and work up the facts to suit that figure. Having regard to the trumpeting which heralded this Plan, I think that history will show there has not been a greater flop since the Walls of Jericho fell.

The Gracious Speech states that My Government will strengthen and develop the policy for productivity, prices and incomes… This is possibly the most important part of the Speech, because upon its fulfilment and our ability to get incomes related to productivity our ability to sell goods overseas depends. This is the corner-stone upon which all our future must be built, but does it look like succeeding? We have a Minister of Technology whose union is certainly not backing the First Secretary, and there are quite a lot of reservations in other unions concerning the early warning system.

The Minister of Labour, for whom I have a high personal regard, knows a great deal about the day-to-day workings of industry. One of the weaknesses of the national incomes policy—and it is difficult to see how it can be overcome—is that out of a working population of about 24 million probably no more than 9½ million are in unions and the wages of only those 9½ million can be controlled. The rest who are outside the unions are not in any way affected by union arrangements. They can have their wages and salaries moved far beyond the normal. We could find ourselves by virtue of this in an extremely difficult situation.

I am confident that salaries in employment outside the unions have increased in the last year by very much more than the norm of 3½ per cent., and probably by as much as if not more than the 8 per cent. which the Chancellor of the Exchequer talked about. It is, therefore, no use burying our heads in the sands and thinking that because we have Mr. Aubrey Jones and his colleagues looking into this matter all will be well. There is a great deal more to be done before we reach an incomes policy which is viable and makes sense and before we get co-operation from everybody.

Mr. Gunter

I am interested in the hon. Member's examination of the weaknesses of the incomes policy but he has given us no lead on what ought to be done. Will he tell the House?

Mr. Cooper

I know perfectly well that a business operates properly and efficiently by making a profit. That is its consideration. That is the way in which it operates. And its labour costs at all levels are directly geared to the price of the product itself. The great weakness in the nationalised industries, which collectively employ the greatest number of people, is that they are not in competition with anyone and can willy-nilly put up general prices. That is one of the reasons why I am opposed to nationalisation. In private industry we are all exposed to the whip of competition. That is why in many cases we are sometimes able to absorb higher rates of wages, because the effect of competition is to make us more efficient.

This Government will not admit it— though I do not understand why, because they have been advised by all the practising economists—but one reason why the imposition of the 10 per cent. Surcharge creates efficiency is that, by its very nature, it gives an added protection to industries that should not need it. This is a powerful economic argument for bringing it down. I am satisfied that in private industry competition will, in the main, keep wages and salaries at a level that will be all right, but which will be quite wrong, or almost incapable of fulfilment in the nationalised industries—

Mr. Michael McGuire (Ince)

How does the hon. Member reconcile his claim of private industries keeping prices and incomes level with the example set by the National Coal Board of absorbing increases for four years, and keeping its pithead prices level? Coal mining is still a nationalised industry.

Mr. Cooper

Throughout that period the Coal Board reduced its labour costs enormously by closing down pits and transferring men to other areas. If all industry could cut down its labour costs by getting rid of half of its labour force, we could all keep costs down. Furthermore, in this year the Government have come to the aid of the coal industry with a substantial subvention, and last year they came to the aid of the coal industry by getting rid of a great percentage of its debt.

I have not the slightest doubt, nor have those with whom I have discussed the subject and who have any knowledge of house construction or the property market, that the setting up of the Land Commission will not result in one extra house being built or the price of properties coming down. It will have the reverse effect. Land prices will increase and the number of houses to be constructed will go down. There can be no doubt about that.

This great Rent Act of which the Prime Minister talked the other day—what is its effect? Although hon. Members opposite will not admit it, its effect will be twofold. First, it will reduce the amount of rented property to come on the market for renting, because owners will want to sell. Secondly, people living in properties rent controlled under the 1957 Act will, in the main, have their rents put up by about 15 per cent. I cannot believe that the Labour Party will be very pleased about that. I have heard from some of my constituents already that one: effect of this Measure will be that their rents will go up by 15 per cent. per annum. The right hon. Gentleman the Chancellor of the Duchy of Lancaster should have a look at that aspect.

We read in the Gracious Speech of legislation …to establish a new system of Exchequer subsidies for local authority housing. Really, have we still not got to the stage in our affairs at which we can look at this thing very sensibly? Why should a man, and there are many in industry today, taking home £25 or £30 a week— and there are many families with a combined income of £45 or £50, and in some houses in my constituency the total income is considerably higher than that— why should people in that sort of income group live in council houses, subsidised in many cases by old-age pensioners who are trying so desperately to make ends meet? Will any hon. Member opposite give me just one sound ethical reason for that state of affairs?

Many Conservative-controlled councils have introduced differential rent schemes where, as everyone knows, we start by charging the full economic rent for the property. As the man's income or the family income decreases, rebates are granted. As a result most housing schemes of Conservative-controlled councils operate either at a surplus or at very little deficit. In llford, the only subsidy provided out of the rates is for old-age pensioners. Surely, that is the sensible and practical way to go about things. Council house rents in Scotland are a national scandal. People there are living in council houses at rents of 14s. 8d. a week. Such a thing should not be tolerated in this day. Bearing in mind the high incomes people have today, they should pay an economic rent for the property in which they live.

This Government, by stealth one way and another, are introducing creeping nationalisation or Socialism—after all, that is the keystone of the Labour Party. But this is a free society, not a Socialist society. This is a society dedicated to a mixed economy, and based principally on private enterprise. Our purpose on these benches is to crush this Government with all speed, and to return to the ways that built and developed our great country.

7.7 p.m.

Mrs. Renée Short (Wolverhampton, North-East)

The speech of the hon. Member for Ilford, South (Mr. Cooper) is typical of Tory spleen. They are so annoyed that the last Session of the Labour Government was so successful in getting through so much of our election programme. They overlook the fact that we passed nearly 70 Bills, and now that we have a Gracious Speech with proposals for legislation to carry out most of what was left of the election programme they really do not know whether they are coming or going, or what line to take in the House. The hon. Member spoke of what he called the vain promises in the election period, but we are now putting forward a programme which will carry out those "vain promises".

The hon. Member's remarks about subsidised council houses are typical of the denigratory Tory attitude of trying to divide sections of the people against each other. He mentioned families with £30 to £40 a week coming in and asked why they should live in subsidised council houses. What a scandal it was, according to him, to have low rents. I must tell him that, as a Socialist, I believe that what we should be doing is to make sure that all families live in houses, whether rented or bought, at low rents or low repayment costs. That is my Socialist philosophy, and I shall not be satisfied until every family is living in a good house, well designed, well built, under those conditions. If the hon. Gentleman likes to campaign against that idea, it is all right with me.

The right hon. Gentleman the Leader of the Opposition yesterday made a very earnest and hard-working attempt to attack the Gracious Speech, and the hon. Member for Ilford, South has merely reflected what his leader sought to do yesterday. Here is the dichotomy. The Leader of the Opposition is placed on the horns of a dilemma. First, we were accused of not carrying out our programme. Now that we are carrying out the programme, we are bringing forward all the old faces, as he called them. But the majority of people—as, indeed, the large majority of Members, and certainly those who think about these things and have the intelligence to understand what the Labour Government are doing—will welcome the Gracious Speech. I do, and I think that the legislation going forward from my right hon. Friend the Minister of Housing and Local Government will bring enormous benefit to the people, and will be much welcomed by them.

I regret one or two omissions from the Gracious Speech. I, too, am sorry that steel does not feature in it. I, too, as a Socialist, am quite unrelenting about this. I want to see public ownership extended, because only in this way can we really plan the economy. Only by extending public ownership can we make the National Plan work and thus look forward to the implementation of a five-year plan and then second and third five-year plans, as we shall do if the Labour Government carry out their programme and are returned, as they will be, with a larger majority at the next election, whenever that may come. Above all, I believe that we should be extending public ownership because this is the way of transferring economic and political power to the large mass of the people who create the country's wealth from the hands of the small number who now own the greater part of the country's wealth. This is one of the reasons why I am a Socialist.

I am also rather sorry—probably my right hon. Friend the Chancellor of the Duchy of Lancaster agrees with me about this—about the absence of another item from the Gracious Speech. I refer to proposals I looked for from my right hon. and learned Friend the Home Secretary for the reform of the law relating to abortion. Such a Bill would have been welcomed with acclaim on both sides of the House and by the general public. I draw my right hon. and learned Friend's attention to the fact that we obtained 144 signatures to a Motion asking for the reform of this law before the House rose for the Summer Recess. This was a record number, four times as many as a similar Motion obtained at the beginning of the Session. I remind my right hon. and learned Friend that we look forward to persuading him to carry out the promise given by my hon. Friend the Minister of State, Home Office that should I or any other private Member be successful in the Ballot and introduce such a Bill time will be found for it. I hope that we shall do this very shortly.

I want to speak mainly about the section of the Gracious Speech which refers to the establishment of a wider European market". I want to speak about our export trade. I was rather disappointed that no one spoke about exports in the debate on the National Plan. The subject has been flirted with a little by one or two hon. Members opposite today, but no one has really dealt with the subject. I propose to try to do so.

I very much welcome the statement that we are to work for the establishment of a wider European market". I have always opposed Britain's entry into the European Community. I do not believe that there is a place for Britain in this narrow, capitalist-dominated community. It exists as an uneasy association of States, all producing more or less the same kind of goods, all competing for markets with each other, all taking in each other's washing. The wider horizons of the Soviet Union, of Latin America, of the developing States in Africa, and, above all, of Eastern Europe, are the markets where we can find both a challenge and a promise, a challenge which we must accept if we are to achieve the increase in our exports of 5¼ per cent. per annum outlined in the National Plan.

Mr. Cooper

How would the hon. Lady get over the fact that 17 per cent. of our exports go to the six countries of the present E.E.C.? With the reduction in tariffs within the Six we are steadily losing our trade. Seventeen per cent. represents a very large sum of money indeed.

Mrs. Short

I am not saying that the 17 per cent. should not be maintained or improved upon. What I hope to prove to the House is that there is a large market where we are only touching the fringe of the potentiality. We can increase our trade with the Community, but this does not mean that we have to enter it and accept all the political considerations that membership of it would entail.

The wider horizons of the markets I have outlined, particularly those of Eastern Europe, provide a tremendous challenge and opportunity for the expansion of our export trade. This is particularly relevant to my constituency and to other highly developed industrial constituencies in the Midlands. There is a market for our cars and our motor cycles in Eastern Europe. During the summer Recess I visited four Eastern European countries—not at the nation's expense, either. In those countries one sees no British cars. One sees Mercedes-Benz's. One sees Peugots. One sees Citroens and Fiats, but one does not see British cars. I wonder why.

There is also a tremendous market for man-made fibres, heating appliances, transformers, switch-gear equipment, automated machine tools, battery electric vehicles, as well as for footwear, clothing, nuclear power stations and computers. All these things, which are produced so well in this country, can be sold to the countries of Eastern Europe. All the countries in Eastern Europe—I visited many factories when I was abroad —are, like ourselves, short of skilled labour. There is, therefore, a considerable market for automated machine tools and for automated machinery for steel works and for railways.

Some of our great engineering firms have made considerable progress in this field. English Electric recently won an export order worth over £1 million to provide automatic control equipment for Czech steelworks and Czech state railways. Many other Eastern European countries are interested in this.

When we talk about increasing East-West trade we are talking about increasing trade with countries which in the next decade will have a very rapidly expanding standard of living. This brings us up against certain problems—the problems of long-term contracts and of the political barriers which now exist, so long after the ending of the last war.

Undoubtedly East Germany is one of the most interesting and hard-working countries of Eastern Europe. It is now Europe's fifth most important industrial nation, even though it has a small population of only 17 million. During discussions that I and several of my Parliamentary colleagues had with leading members of the East German Government—from the Ministry of Foreign Trade and from the Foreign Office—it was made clear to us that they are very anxious to increase their trade with us. There is tremendous enthusiasm for closer contacts with us and for greater trade.

We, because of political arrangements made at the end of the war, negotiate our contracts with East Germany only through the Confederation of British Industries. We do not do it through the appropriate Ministries. We negotiate trade settlements only for six months at a time. France, Italy, Belgium and Greece—all countries within N.A.T.O.— do very much better for themselves and arrange contracts lasting for three-year periods. We are hamstrung by the idiotic Hallstein doctrine and are over-conscientious in keeping to its rules, dotting the "i's" and crossing the "t's", and we are deliberately hindering our export potential.

We suffer because Ministers and leading figures in industry in East Germany are unable to travel to Britain to negotiate contracts without applying to the Allied Travel Office in West Berlin for a visa to enter this country. What is more, they have to apply in person and, because of the decentralisation of East German industry, it can mean that a person wanting to come here to negotiate a trade agreement has to travel 150 or 200 miles each way, a return journey of between 300 and 400 miles. He has to go to make his application, he has to return, and then, in a few weeks, if it has been granted, he has to come back again and pick up his permit. After that, he returns to his job and then, when he wants to leave the country, he has to go again to Berlin to take the plane to come to Britain. In all, therefore, he may have to make three long journeys.

This is the height of idiocy. What would our attitude be, translating the situation into our own terms, if we asked Lord Robens or Lord Beeching to undertake the same kind of journeys when they wanted to go abroad to buy material or machinery for their own industries? The whole process can take a long time; five, six or seven weeks is not unusual. When I wrote to the Foreign Secretary about it, he said that temporary travel documents are obtainable in two or three weeks. Experience shows that it takes, perhaps, three times as long as that. He said also that travel documents are issued to people who are not prominent political persons. Why should not we give travel documents to prominent political persons from that particular country as we do for every other Socialist country for whatever reason people may wish to travel to Britain?

The Ministers or their deputies who want to come and the leaders of the publicly-owned industries in East Germany are, inevitably, prominent political persons. The consequence of our not being prepared to give visas to these people to come to Britain to negotiate trade contracts is that we penalise our own trading opportunities.

Mr. Eldon Griffiths (Bury St. Edmunds)

Will the hon. Lady answer two small questions about Berlin? Has she ever had the experience of trying to get into East Germany not as a member of a Parliamentary delegation? I have had that experience, as many British persons have. I assure her that the Communist authorities make it extremely difficult, and certainly more difficult than the British Government do, for people from East Germany seeking to come here.

The second point—

Mr. Speaker

Order. An intervention must not be a speech. I think that that was enough.

Mrs. Short

I have gone to East Germany not as a member of a Parliamentary delegation, and I did not find undue difficulty. I went there and, as the House sees, I got back. I am talking about the difficulties which we create because we adhere to the outmoded and irrelevant procedure of the Allied Travel Office in West Berlin. It is high time that we took back the sovereignty which we handed over to other nations and decided for ourselves who should come to Britain, making it possible for everyone who wishes to come in order to trade to be able to do so without difficulty.

In 1961, the Labour Party conference discussed the question of East Germany and laid down quite clearly the lines upon which we should proceed. The resolution which was carried at that conference was very ably moved by my right hon. Friend the First Secretary of State, and I urge my right hon. and hon. Friends on the Front Bench to read again those proceedings at the 1961 conference and carry into effect the resolution which was passed. I hope that we shall be able to establish a trade mission between the two countries and take out of the hands of the Confederation of British Industries the negotiation of trade contracts.

It is highly significant that, on very many occasions, when applicants from East Germany apply to the Allied Travel Office in West Berlin for a permit to come to this country, and state why they wish to come, they receive a visit from representatives of West German industry who manufacture the same kind of goods as the East Germans wish to buy from Britain. The West German representatives are able to go into East Berlin and East Germany without much difficulty—? it is only a car ride away—and they say, "We are able to provide the goods you want without your having to journey to England, without your having to go through this cumbersome and rather humiliating business of applying for a permit from the Travel Office. Let us meet your order".

The trade figures of the two nations speak for themselves. The figure for exports from Britain to East Germany last year was about £10½million, and the corresponding figure for West Germany was £170 million. I hope that we shall make some inroads into that £170 million and do more of the trade ourselves.

I want the First Secretary, the President of the Board of Trade and the Foreign Secretary to look into this matter seriously. In my view, nothing should be allowed to stand in the way of the development of our trade with any country in Eastern Europe. We cannot afford it, and it is high time that these outmoded and irrelevant procedures were done away with. The markets are there. The will is there in all the countries of Eastern Europe.

If we are to grasp our opportunities and improve our trading performance, we must show ourselves much more energetic and much more knowledgeable in the way we go about trying to get into these markets. Individual firms are making great efforts. I know that many of our well organised and modern firms are thoroughly export-minded and doing everything they can. They take part in the trade fairs which are organised and put on a very good shop window for Britain and for British engineering goods in particular. But, above all, and apart from all that, we need better representation in our embassies abroad. From my conversations during the summer with exhibitors at two trade fairs, I know that this is very much wanted and expected by many of our exhibitors abroad.

It is urgently necessary, in this age when exports are crucial to Britain's survival, that, in addition to the traditional Foreign Office kind of representation, we have on our embassy staffs men who understand engineering. I mean not necessarily men who are qualified technically or scientifically in every branch— that would not be possible—but people who really understand the language of engineering, who are able to make the right contacts and give the right information, being familiar with what our exhibitors and representatives abroad need to know when they go to an embassy seeking help.

This is by no means a new idea. As long ago as 1942, now 42 or 43 years ago—[HON. MEMBERS: "Oh."]—I am sorry; I must not overstate the case, and I should have said 23 years ago—the Association of British Chambers of Commerce petitioned the Foreign Secretary at that time, Mr. Anthony Eden as he then was, to ask that all embassy staffs should include astute commercial negotiators. The reply was that we had to have Foreign Service officers who were able to acquire a knowledge of languages, and so forth.

Then, in 1963, in the lifetime of the last Conservative Government, Mr. Erroll, when he was President of the Board of Trade, announced an experimental scheme to appoint men from industry to commercial posts in embassies. I wonder where those gentlemen are now. Were any appointed? If they were, where are they, and what have they been up to since 1963? In the countries which I visited there was no sign of them. In two of the countries where trade fairs were being held many of our exhibitors expressed the view that such help from embassy staffs would be invaluable. I hope that the new appointment of Lord Brown to be responsible for our export drive will do something to resurrect that very good idea.

Unless we do the things that I have suggested we shall find that our chief competitors in Europe, which are mainly West Germany and America, will be increasing their trade with the countries of Eastern Europe. At the Leipzig Fair there were a large number of American firms exhibiting—88 I think, the largest number so far at a Eastern European trade fair. The Americans have recently sent a trade delegation to Poland and Rumania. They are becoming conscious that Eastern Europe exists as a flourishing and worthwhile market. We ignore that market at out peril. We are able to get first-rate goods from many of those countries, and in return they want long-term credits and want to be able to buy modern industrial equipment, the sort of equipment that we can produce so well.

So, if we are looking for the imple-mention of the plan, I hope that we shall not allow any barriers to interfere with our need to expand our trade with the countries of Eastern Europe, and that we shall really go ahead and make a tremendous drive in the coming year to ensure that our export target is reached.

7.32 p.m.

Sir Lionel Heald (Chertsey)

It is inevitable that during the general part of this debate hon. Members should make their contributions on different subjects. I am very much tempted to follow the hon. Lady the Member for Wolverhampton, North-East (Mrs. Renée Short) along some of the paths that she was leading us down. I should particularly like to discuss with her a little more than it is possible to do her apparent view that, while not wishing to have any dealings with the wicked capitalist countries in Western Europe, we should at the same time increase our trade with them. That seems rather a difficult operation.

One must, unfortunately, confine oneself within reason in these debates, and I have already made up my mind that someone ought to make some reference to the subject which was just mentioned by the hon. Member for Dewsbury (Mr. Ginsburg) at the end of his speech. As far as I know, that was the only reference that has been made to the very important subject of the redress of the individual's grievances. There is a statement in the Gracious Speech that legislation is intended to be introduced.

I should like briefly to discuss how the matter should be dealt with. I am entirely in favour of steps being taken to improve the machinery for the investigation and, where possible, redress of the grievances of the individual. There are many cases at present, I am sure, where that is not satisfactorily achieved. I am most certainly in favour of steps being taken to that end as soon as they can be. I was, therefore, in common with many other hon. Members, very pleased that the White Paper on the subject was produced. I think it is absolutely essential that the White Paper should be used in the way that such documents ought to be used, as a vehicle for full and free discussion in the House at which all the various points of view, pro and con, can be put —different methods, different expedients —and the Government should maintain a flexible position until they have heard the discussion.

I am alarmed through reading something written by one of our hon. Friends who is so much better informed than the rest of us are. He said that a Bill was already drafted and all ready and merely wanted, in effect, the rubber stamp of the House in a very perfunctory debate on the White Paper and it could be brought in and become law at once. I believe that that would be very unfortunate indeed. Some hon. Members may not be aware of it, but this is a subject upon which there is a great deal of difference of opinion. It is a very difficult subject indeed. It is one that we ought to discuss and consider very seriously before we enter upon legislation.

I know that it has been said, "We need machinery. This machinery is better than nothing. Let us try it out. We can always improve it later." The leading article in The Times on the subject spoke of tall oaks growing from small acorns. I believe that that is a very mistaken approach. If in a matter of this kind one makes a mistake with the initial legislation, it is very difficult to get Par- liament or the Government to tackle it again. What they are much more likely to do is to say, "There it is. We must make the best of it." I regard with great concern the possibility that a Bill might be introduced and be—I will not say "steam-rollered"—pushed past without there being very full opportunity for consideration.

It would not be appropriate for me now to go into any detail about the matter, but I think that I can briefly explain to the House the apprehensions that I have and those felt by a number of people who have studied the question very carefully. It should not be thought that this is a new suggestion which has come along. Ever since the Franks Committee reported some years ago it has been recognised, as the Committee itself said, that it was very unfortunate that its terms of reference were not wide enough to allow it to deal with these cases. It could advise only in relation to tribunals and matters of that kind where there was an existing right of appeal or review or could be one. Beyond that it could not go. It is in that realm that we are not moving.

The proposal made in the White Paper is for the ombudsman. I do not think it is any use anybody trying to get rid of that word. It is far too enshrined in publicity, and whatever anybody tries to call it, it will undoubtedly keep that name. It has a much grander title in the Gracious Speech—a Parliamentary Commissioner for Administration. One disadvantage of that title is that it has 18 syllables instead of three. There are other disadvantages. I should like the word "ombudsman" to be kept for the purpose of this discussion because it describes what the institution is in the countries where it has been introduced and tried—Scandinavia and, later, New Zealand—where it has to some extent been successful.

Those are small countries compared with ours, and in such a country it is possible for a single man to be in touch with the cases and investigate them himself, or at any rate see the result of investigation. It must be realised from the beginning that in this country, according to those who have written about the matter, it would be necessary for the ombudsman to have probably six—some authorities have suggested 12—assistant ombudsman all over the country, each with his staff and office. Whatever co-ordination there might be, it would not be possible to have the feature which is being insisted upon as being so valuable in Scandinavia and New Zealand—it has been achieved to a considerable extent there—of having a man who deals with all cases and is able to apply his own methods and work out his own principles. From the very beginning one is dealing with something which is not really on the same basis at all.

But the matter goes very much further and it is this aspect, of particular interest to us, to which I want to address myself. In the White Paper it is stated: We do not want to create any new institution which would erode the functions of Members of Parliament. …Our proposal is to develop these remedies still further. We shall give Members of Parliament a better instrument which they can use to protect the citizen… namely, the services of the ombudsman. I am not concerned, and it would not be right that I should be, to argue the case tonight but I am bound to say that I take the definite view—and I am fortified in this by the results of studies and discussions with a number of friends inside and outside the House—that the arrangement outlined in the White Paper will not give hon. Members a better instrument for the redress of grievances. It will, if anything, decrease their power and ability to assist their constituents.

It is laid down that the Commissioner must act only at the instance of Members of Parliament and cannot act in any other way. It is also laid down that it will not be a question necessarily at all of an M.P. being approached by people in his own constituency. A person may go to the next constituency to consult its M.P. if he does not get satisfaction from his own M.P. Let us see what that will mean to us.

I believe that the vast majority of us take great pride and feel a very great responsibility in the right—which is a remarkable one as one learns when speaking to Parliamentarians from other countries, who are astonished by it—to write a personal letter to a Minister to tell him that one is convinced that a constituent has suffered a grievance. Few hon. Members ever do so until completely satisfied that they should use this remarkable power.

Will hon. Members go on doing that under the new system? Let us imagine the system in force. How many hon. Members will be prepared to turn down an application from a constituent in the knowledge that that constituent will be encouraged by the scheme to go to the neighbouring constituency, which may be represented by a political opponent, to ask its M.P. to take up the case instead? At once we find that the question of the redress of grievances—the great right of hon. Members to assist their constituents —instead of being, as now, an entirely non-political matter, may well become one of party politics. I believe that that would be a serious matter.

In common with most hon. Members on both sides of the House, I never inquire into the politics of a constituent who asks me to do something. But in future will an hon. Member not hesitate before telling a constituent, "I have considered your case but I do not think I should put it forward". A very large number of people turned down in this way—and one will not altogether be able to blame them—will put a letter into the post to another hon. Member who may be on the opposite side of the House to their own M.P.

I shall not go into the question of whether the ombudsman will be able to go into his job properly without enormous staff or whether he will be able to do very much better than hon. Members. But there is a serious point involved because, as I read it, the ombudsman's right will be very much less than that of hon. Members. Many restrictions will be laid upon him. He will be prevented from inquiring into many things. For example, he will not be entitled ever to make inquiry about Service complaints. Yet Ne have frequently dealt with complaints by people who are in trouble in the Services and such cases are dealt with in a sympathetic manner nowadays. I have had many cases myself. But the ombudsman will not be able to take them.

It will not be surprising if we find, after Parliament has approved the system, that hon. Members will be told, "That ombudsman cannot have this sort of information, so why should you have it? "I think that the idea of these two things working in a sort of uneasy parallel is something that we should look at very carefully.

There is an even more serious matter. The ombudsman is to be limited in a way described in these words: It will not be for him…to examine a decision on the exercise of discretionary powers, unless it appears to him that the decision has been affected by a fault in administration. There is no such limitation on hon. Members. A very large number of cases we have to deal with are essentially where a Ministerial discretion has been exercised in a way which we say has been unreasonable or unfair. There has usually been no maladministration; the matter has been dealt with efficiently and the rules observed, but nevertheless the decision should be reviewed.

I defy anyone to tell the House where the line comes between a fault in administration and a fault in discretion. A recent article in the Law Journal pointed out the extraordinary difficulty of drawing the line. Paragraph 16 of the White Paper states what is to be the objective of the exercise …the scope of the scheme must be made as clear as possible, so that everybody may know as plainly as may be what cases the Commissioner will be able to take up… and what he will not. I do not know, and I do not believe that anybody else knows, where the line between the exercise of discretionary power and a fault in administration is to be drawn. Supposing there has been admirable administration and efficiency yet a most unfair decision. In such a case today, hon. Members are not governed by any kind of narrow rule and to bind the ombudsman, who will, in effect, be the operative channel for hon. Members, in this way strikes me as being not an advance but as very much a retrograde step.

I know that other hon. Members want to speak and it is not really right to argue this case in detail, but I should like to appeal earnestly to the Government to take the course which I am about to suggest. Let us have a really free, full discussion on the White Paper. Let that be brought forward by the Government with an open mind. Let them remain flexible.

I have been working on this matter in one way or another for some years and I can say that there is a group, of which I am not actually a member, but with which I am associated through the Inns of Court Conservative Society, which has been working on this recently. It takes the view that something much more efficient and effective is required than this one man with a department of his own of uncertain size. Something is required in the way of an administrative commission, something on the lines which exist in countries like France where they have it worked out to a great degree, a real tribunal at which these things could be dealt with in a formal way. There is no need for a formal approach from the point of view of the actual administration but there would be this great advantage, that it would be recognised as giving authoritative decisions requiring a lot of consideration.

I would sum up the matter by saying that this ombudsman sounds a nice, easy way of doing it. It is a splendid idea. Here is this great, just man, to have the powers of the Comptroller and Auditor-General, who will be able to right one's grievances. When one looks at the White Paper it will be found that he has no teeth at all. His teeth consist of reporting back again to the House. Having got a complaint from a Member of Parliament he will report to a Select Committee, which will make a report after some discussions. There may be differences of opinion, a majority and minority report. What happens to Mr. Jones' grievance? Everybody has forgotten about that. It is probably a year old by this time, and he may even be dead.

That is the simple plea I make. I am prepared to say that I recognise that the decision that something ought to be done about this is right. I am sure that my right hon. and hon. Friends would be prepared to co-operate in this matter. I am bound to point out that we cannot say that it is a matter which is not controversial. I might perhaps say that in that connection I read a letter in The Times, just after publication of the White Paper, written by a noble Lady who for many years was known to many of us here as Elaine Burton.

I happen to know that she was someone who had a great deal to do with redressing grievances. I was once associated with her in a case in which we were successful in obtaining a satisfactory result. I was surprised to find that in her letter she said, in effect, that this was an ideal solution, absolutely perfect, that it was all cut and dried, and it could go through the House in 10 minutes. With the greatest respect to her, I cannot agree with that. I believe that this may be the subject of one of those very important debates that we have from time to time, where there is no party issue involved. We are dealing with great issues affecting individuals and I sincerely hope that the Government will be prepared to treat the matter in that spirit.

7.55 p.m.

Mr. William Wilson (Coventry, South)

I am sorry that I cannot follow the right hon. and learned Gentleman the Member for Chertsey (Sir Lionel Heald) entirely in what he had to say, but the comments which I want to make have some relationship to his, as I, too, want to speak about a subject dealing with the liberty of the individual. I want to refer to that part of the Gracious Speech relating to the development of new ways of dealing with young persons who have come before the courts. It is out of an experience of appearing, almost daily over the last 20 years, in the criminal courts of this country that I want to speak tonight. I feel that any person who has any connection with the juvenile courts, in any capacity, very quickly realises that the biggest single factor that brings young people before the juvenile courts is the home background which they have enjoyed or suffered.

It is very rare indeed that one hears of a child coming before the courts who has had a good home and a good parental background. I feel that the coincidence is far too great for it to be ignored. We can go a stage further and say that anyone who has any experience of dealing with the older criminals discovers that the biggest single common factor in the background of these older criminals is the juvenile delinquency of their youth. It is no exaggeration to say that if the juvenile delinquency problem could be solved it would be the biggest single factor towards solving the crime rate among senior criminals. My experience teaches me that there is no other real way of dealing with this.

When we consider this part of the Gracious Speech we also ought to pay tribute to the part played by the proba- tion service of this country in relation to the treatment of juveniles. This is invariably devoted service, carried out under adverse conditions. Sometimes when I look at the buildings and offices where the probation service carries out its work in my constituency, and then look further down the road, at the palatial police station which we have—although I would be the first to acknowledge that the new police station in Coventry was a necessity—I wonder whether this is not a case in which we have our priorities wrong. The probation service is overworked and under-paid, even since the recent wage increases. I often used to wonder, when looking at the television series on probation officers, whether any probation officers were also looking at that programme. It was a sobering thought that the probation officers looking in were probably earning only one tenth of those who were portraying them on the screen.

A fair amount of criticism and helpful advice has been coming from the probation services on the subject of the family councils referred to in the White Paper, and on the subject of the new treatment of persons coming before juvenile courts. We should ask the Government to take account of how important it is to have the help and the support of the probation service in bringing forward any new ideas. Those engaged in the education service realise that we cannot have educational reforms without the backing of the teachers. Similarly, it is necessary that the reforms which the Government have in mind for dealing with young criminals should have the backing of the probation service.

While one would agree that there is a great deal to commend in the White Paper's new ideas for the treatment of criminals, one can understand the objection which the probation service raises to them. Take the suggested family councils. They will mean that the parent and various officials will meet together and try to decide what should be done with the child before them. They will have the power to deprive a child of its liberty, although it is not said that he will be sent to a detention centre. It may well be wrong to deprive any individual of any part of its liberty without using the court law which has grown up over a long time.

Perhaps the big danger is that a child attending a family council will think that the parents and officials are ranged against him in deciding what should be done with him. The bond between parent and child is substantial and must be preserved, and a child who comes from a good home and has good parents can feel that sense of bond between them. If a child comes from a home in which the parent says, "It hurts me more than it hurts you, but I think that for your own good this is what should be done", the child may well understand the point which the parent is making. But the child who comes before a juvenile court does not come from that sort of home. The link between him and his parent has already been weakened.

In the family council the part of the parent will be very great indeed. Anyone who attends a juvenile court knows that the most common phrase used there by a parent about his child is simply, "He is a good lad at home". Every parent thinks that his child is a good lad, and that is where the family councils' difficulties will arise. Even though there have been difficulties between the child and the parent, the cry that he is a good lad at home is continually heard in the juvenile courts.

It may be difficult for a family council to improve the relationship between the parent and the child, and that relationship seems to be fundamental in the problem of juvenile delinquency. We should realise the part which is already played by the probation service in the juvenile court. Every year, 70,000 special reports on children before the courts are prepared by the probation service. They are not only factual; they give an indication of the way in which the child should be treated.

I cannot think that it is new courts or new councils that we want. What is really needed is the implementation of the legislation which is already in existence. What we are short of is places in remand homes for juvenile offenders. I know that the situation has improved recently. It has improved considerably in my area. One of the first tasks which I had as a Member was to protest about a young lad being kept in an ordinary prison. The situation in my area has changed, but there is still a lot to be done throughout the country.

We need better facilities for psychiatric treatment and more places for educationally sub-normal or maladjusted children. But, above all, we need more trained personnel. The probation service is a thousand short of the officers required to carry out the duties placed on it. The White Paper clearly says that before it is implemented full consultations will take place. I hope that those consultations will take place and that the statement in the White Paper is not merely window dressing.

Children's lives are far too important to be jeopardised by hasty decisions. I hope that the Home Office, when it makes its decisions, will take note of the substantial objections made by a body of individuals who are best fitted by their experience to talk about this subject.

8.7 p.m.

Mr. Eldon Griffiths (Bury St. Edmunds)

I agree entirely with what the hon. Member for Coventry, South (Mr. William Wilson) said about the need to improve the status and income of those in the probation service. Recently, I had occasion to go to see a constituent who had just come out of gaol. In the home which his wife had kept together during his period in gaol were two tiny children, and their conditions were appalling. I was ashamed to see them in such conditions in 1965.

As a Member of Parliament, I made inquiries in the fashion mentioned by my right hon. and learned Friend the Member for Chertsey (Sir L. Heald). In making those inquiries I found that those in the probation service were the only people really tackling the job on the ground, and I was filled with admiration for the way in which they were doing it.

The hon. Member for Coventry, South will forgive me if I deal with a different and prehaps slightly wider subject in commenting on the Gracious Speech. As a Conservative Member, I welcome many parts of the Gracious Speech. In particular. I was glad to read the Government's intentions about rates. I am not sure that there will not be some details which I will want cleared up. I was also glad to read about the prospect of improved pensions for service people, whether from the Armed Services or from civilian Ministries.

Although there was only a glancing mention of it, I was glad to see a reference in the Gracious Speech to agriculture, which concerns by constituency. Farmers will judge the Government not by their words but by their deeds. In view of what they have done in the last year, particularly the lamentable Price Review, very few farmers will be persuaded by a series of new statements in the Gracious Speech that the Government have suddenly become conscious of the real needs of the farming population. It is clear to me that they have not, but the mere fact that they have put in a reference to agriculture is a step forward.

The criticism which I would make of the Gracious Speech as a whole is that it does not tackle the two big changing factors in our society. First, it does not go into the matter of regional development in anything like the detail that I had expected. We hear a lot about the North-East and Scotland and I am glad that in large measure, due to the efforts and the policy of the previous Government, both those areas are today much better off than they could have expected to be without those policies.

There is, however, another region of which I presume to speak from time to time, namely, East Anglia. It is here that a new frontier is emerging in Britain today, for three reasons. First, we have the development of the East Coast ports, the ports which face the Common Market. It is increasingly obvious that instead of sending their goods down from the North and from the Midlands into the congested mass of London, and often getting them lost in the docks, many more industrialists from the Midlands and the North prefer to send their goods to the Continental market along an East-to-West route by way of the developing ports of Harwich, Ipswich, Felixstowe, and so on. This is a healthy tendency and I should like to see more effort made by the Government to improve our east-west communications so that we can more easily get these important exports into the European market—by way of our East Coast ports.

The second reason why East Anglia is becoming a flourishing region is the prospect—perhaps I should put it no higher than that—that off our eastern shore we may find new sources of natural gas and, possibly, fuel oil. It is too early to say for certain that we shall find these new resources, but the picture looks hopeful. If it should be that off those eastern shores we have available an indigenous sterling source of fuel under our own control and not subject to the vulnerabilities of a precarious Middle East, East Anglia will have something that it has never had before—cheap fuel which will not need to be brought from the coalfields and which will be available, perhaps, for the beginnings of a petrochemical industry along our eastern shores.

The third reason for the growth of this area is the rapid increase in its population, both the existing local population —our birthrate is high—and also the new people coming to East Anglia from London. I should like to see that ugly word "overspill" abolished from our political vocabulary. It is an insult to human beings to describe people as overspill. I am glad to see people coming from London and enriching our technical and cultural life in East Anglia. But I dislike having them described as overspill.

These are reasons why East Anglia is developing, along with many other regions of Britain, and it did not seem to me that in the Gracious Speech there was any attempt to tackle the regional problem in the detail that I had been led to expect.

Equally, however, I think that the Gracious Speech fails to tackle the emergence in Britain today of a new group of people within our society. It is of one group in particular that I want to say a few words tonight, namely, the people who have been variously described as the technocrats, the meritocracy or the salariat. Essentially, they are the young and aspiring young marrieds who stand at the middle of British politics today. It is they who form the centre. Those people are of immense importance to all of us in this House, because they are the fulcrum of British politics. They are neither to the Left nor to the Right; and as they go, so goes the nation.

It is fair to say that in 1945 the Labour Party captured the centre. The consequence was a very large Labour majority in this House. It is equally right to say that in 1959, Mr. Macmillan very largely helped to capture the centre. The result was a Tory majority of 100 seats. In the last election, I regret to say that the Tories lost command of the centre and that the Socialists did not gain it. If anyone gained it, it was the representatives of the party that is not here tonight. I say this, perhaps, with special direction to you, Mr. Deputy Speaker. The representatives of that party who are not here tonight are a disappearing feature of the British political scene. I believe that we shall see tomorrow, just as we saw a week or so ago, that their policies no longer commend themselves to the public. As I see it, however, the future of the country and of this House will rest upon which of the two great parties is most effectively able to persuade these people at the centre that it represents a modern, progressive, efficient and compassionate Britain. We are competing for the people at the centre. Let that be where the competition should lie. I do not think that there will be disagreement on either side about that.

What I wish to speak of briefly is the kind of thing that, I believe, these people at the centre stand for, what they want in our modern Britain and the kinds of things that the two parties in this House are offering to them. The first thing that these people stand for, or the first thing that they can be identified as, is people who have very large amounts of education and skill. They are the salaried people; the managers, the engineers, the accountants, teachers, scientists, civil servants and so on. The surprising thing is that 7 million people come within that category of the "salaried" and that their number rose by 25 per cent. between 1954 and 1962. They are by far the fastest-growing group in our society. And as Britain becomes more technically sophisticated, they will grow even faster and it is probable that by the middle-1970s they will represent better than one-third of our total force. I welcome this.

Secondly, a feature of these people is that they have benefited from the great post-war revolution in secondary education. A very large number of them are those who passed the 11-plus, an examination which I for one would like to see reformed drastically, if not entirely removed. These, however, are the people who have come up what my hon. Friend the Member for Uxbridge (Mr. Curran) once called the escalator from Coronation Street. I include myself among them.

It is because these people have the drive, the energy and the willingness to go without that they have got ahead, and they are beginning to occupy places in our society which were denied to them half a century ago. As these people of the escalator have emerged, however, they have changed. I suggest that they are no longer in tune with old-fashioned Socialism, for two reasons. The first is because, if I understand Socialism aright —I once even supported it—it is founded upon egalitarianism and a sort of sentimental myth about the solidarity of organised labour. I do not believe that these people of whom I speak any longer accept that if a Labour Government were to abolish the public schools, inherited wealth, Savile Row and the 11-plus, suddenly all men would become equal. The people at the centre do not accept this. They know perfectly well, having bettered themselves, that it is untrue.

The second thing that these people have cast aside is the old myth, which I must confess to having shared as a boy in the late 1930s, of the solidarity of the so called working class. Increasingly, but perhaps wrongly, the people of the centre look upon organised labour rather as the champion of yesterday, as something that is for ever making new demands in the shape of inflationary wage claims and disputing who should bore the holes. That is the image that is possessed increasingly by many of the people at the centre, and it is something that, I am quite sure, the trade union movement will want to take seriously.

Yet if these people are out of tune with the old-fashioned Socialism as I have described it, I think they are equally out of step with a lot of old-fashioned Toryism. I am sure this is true as well. They are not against the public schools, because many of them want to send their sons there. They want choice in education, and that is something we on this side of the House believe in. Neither do they want to dismantle something called the Establishment. I think they are amused by it and regard it as a dying institution. But if they are content to go along with these things, one thing they will not tolerate. They are against there being any longer in the Tory Party any taint of snobbery. "Top" people are not tops to them. The people in the centre are not prepared, in my judgment, any longer to go unrecognised in British society. They will not accept that people should be entitled to top places in Britain on account of their accent or their tailoring or their school or their fathers or anything else. The people of the centre want to be able, and are entitled to be able, to get to the top themselves, and I believe that in the Tory Party increasingly they are doing so.

I want to turn very briefly to identify some of the characteristics of the people I am describing tonight, and to their objectives. I presume to do this having gone to several hundred families during my holidays. I did not go to Eastern Europe as did the hon. Lady the Member for Wolverhampton, North-East (Mrs. Renée Short) who spoke just before me. I went to many parts of Britain, and I found that there were three or four things that these men I am speaking of, the "pacemakers" they have been called, want above all else out of Britain today.

I think the first thing, which is common to all of them, is that they want economic: security. In the last twenty years, or even thirteen, one might say, the causes of the old economic insecurities have been removed from the people at the centre: their standard of living has gone up immensely. Yet if they have been freed of the anxieties which used to beset their parents—over whether they could pay the rent, or the doctor's bill; thank God these things no longer beset so many of them—the fact is that in place of the old anxieties there are today new anxieties. They are the sorts of things which politicians sometimes ignore.

In my view the true fact about modern Britain is that, affluent as we are, many hundreds and thousands of outwardly prosperous teachers, town planners, engineers, civil servants, designers, lie awake at night worrying and scheming about how to stretch their resources to meet their expanding needs. They worry about how to provide private school education if their sons do not get into a grammar school. They worry about whether they should have their babies in a private hospital if the N.H.S. system has not got available a hospital bed. They worry about granny and whether her pension is adequate to support her, and her savings being eroded by inflation. These are the real worries of people in Britain as a whole, and particularly in this middle ground for which we on both sides are competing.

It is certain that these young people, as they have demonstrated by their votes, think that stop-go will not do in British society today. And if the Conservatives in office failed to solve the problems of stop-go in our nation, then we have to say that with the present Government— they have had but a year, I accept that— there has been a crashing stop and no go. The people I am referring to recognise it, and it is a real problem for us on both sides of the House.

I think the other desire, after economic security, is the urge, the individual urge of these people, to get ahead. They want to see some blue sky. I think they are prepared to work very hard and to go without, but they expect there to be a relationship between their efforts and the rewards which they get. Far too often in our society today a man who is prepared, as a business man or a worker, to put in more effort, finds that our taxation structure seems to deny him far too much from his extra marginal labour. I believe it is important that for these people at the centre there should be as rapidly as possible a reduction of taxes on earned income.

I accept that taxes are necessary. It is completely irresponsible to talk of having more and paying less. But if it came to a choice between reducing taxes on earned income and having to retain a tax on capital gains, then I would say, very reluctantly, I would prefer to see a reduction of tax on earned income. I hope and believe that a Conservative Government, when they are returned, will seek to reduce taxes across the board, but I hope that the first priority will go to the reduction of taxes on earned income, because the people of the centre of whom I am speaking wish to see a direct relationship between their effort and their reward.

The third thing I believe they are seeking is a change in the character of the Welfare State. I am not a wholesale dismantler at all, but I think we must recognise that this is 25 years old. I remember in the early part of the war, when I was in the sixth form at a grammar school, reading the Beveridge Report and loving every word of it, because it seemed to speak of something which needed to be done, certainly in the society I was born into. Thank heaven, very largely it has been done. But the two assumptions which came out of Beveridge have gone, or have become irrelevant. The first was that we lived in a country of massive unemployment. We no longer live in a nation of massive unemployment. The other thing was that we had a diminishing birth rate. Well, the babies are bursting out all over in Britain today. So it is no longer necessary to direct the focus of our Welfare State to the problems of massive unemployment. We do not have it. Nor is it necessary to deal with a decreasing population. We have, heaven knows, more increase in population than we know what to do with. Therefore, it is right to say that in present conditions the Welfare State needs to change, so that it meets the realities of a changing society.

What to do? Certainly I would not wish to tear it to the ground. But there are certain things, one is housing and another pensions, and there may be health, where I suggest that change is imperative.

First, on housing. Hon. Members opposite will not agree with me, but I should like to see stress placed upon the massive extension of home ownership in this country. I believe that the people of the centre, not only the young people, but all of us, wherever possible, wish to own homes of our own. It is right that the Government should use their powers to provide cheap rentals for those who stand in need. But having lived many years in the United States I am impressed by the fact that they have achieved something like 85 per cent. of home ownership, and I am sure this adds to the stability of their society. We in this country ought to make it possible for all who wish to own their own homes to do so.

And there is a method, a method in which the Government have a very large part to play. I do not think we should offer fancy interest rates. If we give a man 3 per cent. for his home why should there not be 3 per cent. for a police station, also an essential service? Why should there not be 3 per cent. for exports? I do not think we can have differential interest rates in the same society. But it should be possible for us to have a national housing administration, as in the United States, where a young couple can be sure of one thing, that they will have a stable rate of interest over a long period of years. What they cannot accept is 3 per cent. one year and 7 per cent. the next, an upward and downward gyration of interest rates. They want above all to look forward to a stable payment, month in, month out, over a long period of years, and that is something we could do and ought to do in this country.

I spoke, too, of the changes in pensions. This is not the occasion to go into detail. There will be other opportunities for it, but it surely must be right that pensions, as far as possible, should be related to need. They should not be indiscriminate across the board, meaning that many receive moneys from the State that they do not need at the expense of those whose need is great not receiving as much as they ought to have.

The third field for change in the Welfare State is in the medical field. I would like to see the family doctor made the centre of our welfare services in a community. His condition at the moment is not as good as it should be, and I think we all know that.

The people of whom I have spoken want to see all these considerable changes in the Welfare State. But the fourth thing that they want is higher standards in the country. More than anything else, I was impressed with the desire of young people not just to have more but to have better. In our country, we have got used to accepting the second-rate and putting up with it, at times almost making a virtue of our toleration of the second-rate. We are so easy-going, we do not like to make a fuss. But we all know that there are far too many restaurants where the crockery is chipped or there is dirt and grime, and we put up with those things in Britain. We know that there are too many trains which are dirty and not on time, and we put up with them in Britain. We have a telephone service which, in spite of all the efforts of the present Postmaster-General and his predecessors, by international standards is still not good enough. Far too many foreign visitors come to London, dial the operator and spend too long waiting, until they get the impression that the signature tune of Britain is an uninterrupted "burr-burr".

I believe that the people at the centre are looking for an improvement in standards. That has been reflected in the consumer movement and, I hope, will continue to be reflected in Government legislation.

The last point that I want to make is that people in the centre are haunted by the need for a greater ideal. Over the last years since the war, we have spent too much time as a country on just getting and spending. As the poet said, this can lay waste one's powers. Among younger executives, businessmen and ordinary working families alike there is a desire to serve something greater than self. That greater something can be their country. Not an old-fashioned, flag-waving variety of patriotism; but in having an ideal bigger than themselves. To my mind, that ideal can be found as much as anything else in an association of Britain with the European Community.

I would make two brief comments on that. I ask the House to sit back and picture Britain as it could be in 20 or 30 years from now. By the end of the century, America will have a population of getting on for 400 million. It will have added to its gross national product something like 12 more Britains between now and then, and, with all the fall-out of the space industry and so on, the gap between our total power, economic, military and political, and that of the United States will go on widening and widening. If at the end of the war it was a ratio of something like 3 to 1 in America's favour and today it is about 8 to 1 in her favour, by the end of the century it is likely to be of the order of magnitude of 20 to 1. At the same time the Soviet Union with the techniques of the 1960s and 1970s will be opening up her vast fields of minerals in Siberia and will have achieved an economic and political power at least equivalent to America's today, and perhaps rather greater. Beyond that, there is China.

In a world of super-powers of such immense capacity, how are we in our island to make our voice heard in the world? How are we to ensure to our people the standards of living and the technologies that they are entitled to expect?

I do not think we can do this alone, and I say this with a lot of nostalgia and a lump in my throat about the great past of this country. The time has come when we must boldly take the plunge and decide that it is our rôle to bring into existence a new Europe that is big enough to have a say in the world, not because it is prestigious to have a say, but because I do not want to see the future of mankind decided by some unknown future President of the United States of America, whose attitudes we do not know, talking on the telephone to whichever man has been thrown up to head the Soviet Union.

That dialogue began at Cuba, and it could go on, but I believe that the peoples of Europe, and of this country in particular, have something to offer to it. If it is right that the next problem of the world, beyond the nuclear confrontation, and the cold war, is the fact that two thousand million barefoot peoples are on the march and are looking for a place in the sun, if it is right, too, that it is a contest between them and the richer countries to the North, including perhaps Russia, and if that conflict of rich and poor should be underlined by the fact of race, then we can make a contribution only as part of a larger unity, which should be Europe.

For the people at the centre about whom I have spoken tonight, perhaps for too long, the ideal of playing a part in the creation of this Europe is a compelling thing. I do not say the narrow Europe of the Treaty of Rome. It may have to be bigger than that. It may have to include E.F.T.A. I hope, too, that it will lean to the Atlantic, and always keep the Americans with us. And that in the course of time it will open the door to the nations of Eastern Europe as they wrest themselves free from the Communist system which they are in today.

Our part is surely to be, as it were, the hinge on which this greater Europe that is there today, with all the difficulties of General de Gaulle, will swing open into a very much wider concept. If we can give these people at the centre, and indeed all our people, that ideal, along with some of the other things of which I have spoken, higher standards, economic security, and changes in the Welfare State, then I believe we shall be competing politically about the right things in Britain. On these things let the contest be won.

8.37 p.m.

Mr. Michael McGuire (Ince)

I want to follow the hon. Member for Bury St. Edmunds (Mr. Eldon Griffiths) on the first part of his speech, when he congratulated my hon. Friend the Member for Coventry, South (Mr. William Wilson) on the reforms suggested in regard to child welfare and juvenile courts. The hon. Gentleman seemed to imply that there was some danger in the reforms suggested by the Government. I am sorry that my hon. Friend is not in the Chamber now. Because a place was not available in a school for the educationally subnormal, the son of one of my constituents was sent to a remand home. It was agreed that he would not have been sent to the remand home had a place been available for him at the school. I hope that this state of affairs will no longer exist and that in future the approved school order will ensure that the local authority concerned is able to deal with the matter as it considers best.

The right hon. Member for Leeds, North-East (Sir K. Joseph) made a serious attack on the unions in the nationalised industries. I can speak with some knowledge only of the National Union of Mineworkers. I tried to intervene during the right hon. Gentleman's speech to ask whether he could give figures to prove that the conduct of the unions in the nationalised industries was more irresponsible than that of unions in the private sector. The N.U.M. has always shown the greatest responsibility in its conduct and it is a fact that in certain areas under the authority of the National Coal Board, particularly in the Durham and Northumberland coalfields, strikes are very rare indeed. One has to go back a long way to find examples of the members of the unions having acted irresponsibly.

I believe that one of the great tragedies in the mining industry, paradoxically, has been that the miners have always acted too responsibly. Their outlook has always been for the national good. When the National Union of Mineworkers was putting forward a miners' charter—which, if we are to accept the proposition put forward by the opposition, the miners were always in a position to demand— I well remember Arthur Horner, who could never be accused of being a milk-and-water Socialist, saying, "We can pull down the temple of nationalisation. By putting forward our demands and being able to reinforce them we will destroy the thing that we want to see successfully created." He told his members, "Let us go steady, and we will get these things, because we have more to gain from the success of nationalisation than any other body of workers."

One of the recommendations of the Royal Commission on the trade unions should be that when members of a union take any big decisions they should do so by secret ballot. One of the causes of strikes and the spreading of strikes, as well as of the delay in getting the men back to work, is the successful intimidation by certain people who use their influence and prey upon the loyalty which union men have for each other. These people often prolong strikes as well as bring them about.

I was a full-time branch secretary of the National Union of Mineworkers for seven years, and one of the things that I did as speedily as I could was to see that secret ballots were the order of the day. My branch had no strikes while I was secretary. I do not say that that was because I was secretary. All the big decisions, such as election of officers —and this applied when I was elected as well as everyone else—were taken on a secret ballot.

When the Leader of the Opposition was speaking yesterday it seemed to me that in his opinion the Gracious Speech was a piece of window dressing; it was a question of getting ready for the next election, and was an election winner. I could not agree more. I always believe that the next election is coming as soon as the one that has just been won is over, and that what one must seek to do is to retain power, without which it is not possible to do all the good things that one desires.

I do not want to carry my cross of Socialism into the wilderness. We were in the wilderness for 13 years. I want to ensure that we have a fair crack at power. I believe that this Gracious Speech is an election winner, and to those people who make the charge that the nationalisation of steel has been abandoned I say that it has been delayed— and quite properly. When we feel that the time is right, and when we have put into effect those measures which the people want, we can go to the country again. Then, if we are defeated on the question of the nationalisation of steel, as seems more than probable if the present situation continues, we shall have something in the bank. The people will not accuse us of political inefficiency—of doing the things that we said we would do, but in the wrong order.

I should like to turn to the reorganisation of the finance of the coal industry and its capital reconstruction and the subject of aid for the industry in financing the redeployment of its manpower. I shall not anticipate the Bill proposed on this subject, but I believe that the Coal Board should be treated with more generosity than is, I believe, contained in the proposals. For every £ the Coal Board is prepared to spend on redeployment and reorganisation, the Government should give an equal amount.

Rather paradoxically, one of the factors which has militated against the Coal Board becoming a better employer is that it has always had to take account of the social consequences of transferring men. The Coal Board has set an example second to none in building houses for its transferred workers—an activity which should properly be the Government's responsibility.

If the Coal Board is constantly to be saddled with this kind of responsibility, it will never have enough money to attract men into the industry and pay them proper rates of pay. Although reference was made, I think, on the other side of the House to miners earning £25 to £35 a week, half the men in the industry work for day wage rates. At my pit a third of those men earning day wage rates went home with only about £9 to £10 a week, and they had no prospects of piece work. Therefore, if the coal industry is to be able to offer proper wages and conditions, the terms of legislation will have to be more generous than are outlined at present.

On the subject of council houses and subsidies, I believe that the Labour Party could properly demonstrate that it is a believer in a property-owning democracy. It was the late Hugh Dalton, the first Labour Chancellor, who, through the Public Works Loan Board, gave people opportunities to borrow money at very low rates of interest. We should examine very seriously the fact that our party is saddled with this misnomer, assumed to be simply a "council house party", implying that we believe that council housing is the best way of dealing with the housing problem.

There will always be people who are unable to get a home of their own unless we provide cheap housing, but I urge my right hon. Friends to look very carefully at the possibility of encouraging more and more people to buy their own homes and encouraging local councils to build more houses. If a person has a stake in a house, that will be less of a charge on the Exchequer by way of subsidies.

One passage in the Gracious Speech reads: For the protection of consumers, a Bill will be introduced to strengthen the law on misleading trade descriptions. Consumer protection is a wide subject. Its greatest scope lies in doing away with the subterfuges which exist in some retail trades, particularly in the furniture trade and in the sale of clothing for school children. Many parents and young couples are held to ransom in both these respects. With modern techniques in furniture making, orange boxes can be made to look like bedroom suites and command the most outrageous prices, with no one being able to check the quality of the goods he is buying.

These are small things, to which I believe that a Labour Government will pay more attention than a Tory Government. I hope.that it is a long time before the party opposite has the opportunity to pay attention to anything.

The Gracious Speech mentioned strengthening the National Health Service. I, more than most men, have had cause to be grateful for the introduction by a Labour Government of its greatest piece of legislation, the National Health Service. Voices are constantly telling us that we should reorganise the Service and that there is not the same need for it. They quote Beveridge and say that he envisaged a far different society from that which exists today. I believe that we should strengthen and not whittle away the main fabric of the most noble concept of the last Labour Government, and I believe that the majority of people agree with me. We should not seek to destroy this service by listening to those voices which try to demonstrate that it will be much cheaper, and will provide a better service, if we make changes.

In my opinion, the doctors have some kind of a case. Basically the doctors' case is that which hon. Members opposite used to deride in respect of the working class, for the doctors are seeking to maintain a differential, and they are saying, and sometimes demonstrating successfully, that their incomes have not matched the rise in other people's earnings. If they have a case—and I believe they have —then we should look at it. I was heartened to hear my right hon. Friend state that the Minister of Health has managed to reach an agreement with the doctors which will strengthen the National Health Service. We should put out of our mind the propaganda, which I am sorry to say sometimes influences our own members, which suggests that instead of seeking to strengthen the National Health Service we should whittle it away.?

I want to end on a personal note. There is reference in the Gracious Speech to free trade with Ireland. Sydney Smith once said that the ordinary Englishman always displayed great courtesy, courage and kindliness in dealing with other people except when the other people happened to be Irish. I believe it can be shown that the English have treated the Irish in the past with contempt and callous indifference. I hope that during the negotiations which I understand are going on apace with the Taoiseach— which is the Gaelic work for Prime Minister—of Ireland, in the discussions with Sean Lemass and his colleagues, we shall display a greater consideration for the problems of the Irish people and that we shall have a just and lasting settlement.

I will not continue at length on the question of Ireland for I should probably be ruled out of order. I have noticed the agility of many of my hon. Friends who have tried to introduce a discussion on the Six Counties. It was once said by one of my hon. Friends that the only thing which he could raise in such a discussion on Northern Ireland was Short, Harland and Wolf, and after that he was ruled out of order. I hope that we shall be dealing with one Ireland, because to my mind there is only one Ireland. I hope that we shall remember that we are a powerful nation and that we shall be fair in our dealings with the Irish people and not, as we have done in the past, look upon Ireland as a reservoir of cheap labour or a cheap food store. As an Irishman I believe that one of the difficulties in dealing with this question of Ireland is that far too often emotions and passions are aroused and arguments are put forward which blind us to the real situation. I look forward to a Labour Government concluding an honest and generous deal with the people of Ireland which will be to their profit and ours.

8.55 p.m.

Mr. Bernard Weatherill (Croydon, North-East)

I hope that the House will forgive me if I do not follow in the debate too closely what the hon. Member for Ince (Mr. McGuire) has been saying since I have only a short time at my disposal. I should like to refer to that part of the Gracious Speech which deals with Government policy as it affects trade unions and employers' associations.

I suppose that the biggest debating point in the country today is the attitude of the trade unions to their power and influence in industry. While I note that the Government intend to encourage British industry to achieve greater competitive efficiency by reorganisation and better use of manpower, I am surprised that there are no proposals in the Gracious Speech which will encourage the British trade union movement to reorganise in order that it may play its effective part. I accept that the Government have set up a Royal Commission and that this has yet to report. Nevertheless, I was disturbed to read the evidence which the A.E.U. gave to the Commission the other day in which its submission was to a large part directed towards persuading the Commission to report in favour of a closed shop.

The A.E.U. made the point that if membership of a union was compulsory the union would be in a strong position in being able to apply discipline to unofficial strikers and others who defied its policies. This argument is convincing if the objective is acceptable, but I ask the House to consider two points. First, if the unofficial strikers can be disciplined by the threat or the fact of losing their jobs, would not such a threat more appropriately come from their employer? It seems to me that in such circumstances only the attitude of the trade unions has prevented this form of discipline being applied in the past.

In saying this I do not deny the right of a union to defend in principle a worker who is dismissed as a result of disciplinary measures. That is part of a union's duty, but unions do not always defend unionists in the right way and, unfortunately, very often the whole power of the union is used against an employer who has dared to discipline an unofficial striker.

The second point is that if the principle of a closed shop were accepted who is to say that: there might not be a secondary trade union movement protecting the workpeople from the unions themselves? It is fair to say that this process has already started, because I believe that there are two or three unions, which have been set up in the last 25 years or so, whose main objective has been to fight the so-called dilutee agreements in the engineering industry.

Nor should we apply the closed shop principle to employers' associations. Most people will know that the C.B.I. set-up is a massive organisation of individual manufacturers, commercial undertakings, nationalised industries and trade associations. Can anyone believe that such a body can produce a view which is fairly attributable to all those interests, conflicting and competing as inevitably they are? In practice, the C.B.I. will find it difficult to say anything at all—and this point was fairly made in the October magazine of the Institute of Directors— lest, because it represents such a large part of British industry, it will be taken as speaking for the lot and might, in a statement, adversely affect the £.

Most of my generation have read the history of the 'thirties with amazement. We know that thousands of men were then allowed to be out of work, largely unemployed or unemployable because of lack of training. This is a circumstance that I hope we shall never allow to happen again. On the other hand, if the objectives of the National Plan are to be achieved, thousands of men at present in the dying industries must be retrained into the newer industries. Unless that is achieved, the National Plan will not succeed.

I regret that in the Gracious Speech no mention was made of a massive increase in the work of the Government training centres and of training generally. I fear that, to some extent, the omission may be due to the Government's being inhibited from moving in this field by the reactionary policies of some of their trade union supporters. I wonder whether the House realises that because of the dilutee agreements, many men trained for skilled employment before the war have remained consistently in skilled employment ever since, but as they are what the unions call dilutees they can never achieve the status of skilled craftsmen. That is an official attitude which, if continued, will certainly sabotage the National Plan.

I trust that at some stage, despite whatever opposition the Government may have, they will institute a system whereby vast numbers of people who have been trained or have to be trained in these newer skills and techniques will be given the status and recognition that is an essential part of the reward that a worthwhile workman must have.

9.3 p.m.

Mr. Anthony Barber (Altrincham and Sale)

It is always the case that on the second day of the debate on the Address we have a fairly wide-ranging discussion, and the right hon. Gentleman the Minister of Labour will probably agree that today has been no exception. We have had speeches on almost every conceivable subject, from the ombudsman to juvenile delinquency—

Mr. Gunter

And abortion.

Mr. Barber

And abortion. I only regret that I was not able to listen to the whole of what was obviously an admirable speech by my hon. Friend the Member for Bury St. Edmunds (Mr. Eldon Griffiths).

It is always a pleasure either to follow the right hon. Gentleman the Minister of Labour, as I did when we were in office, or to precede him, as I now do in Opposition. I say that, not only because the right hon. Gentleman is highly respected on both sides of the House but because he is a man of both intelligence and integrity, who will, therefore, I am sure, agree with me in deploring the state of uncertainty into which the steel industry has now been thrown as a result of the Prime Minister's speech yesterday. It is to the omission from the Queen's Speech of any reference to the future of the steel industry that I want to refer first. I hope that even if the right hon. Gentleman does not reply to my own observations on this point, he will, at any rate, say something about the speech of his hon. Friend the Member for Ebbw Vale (Mr. Michael Foot).

There was a time when many people in this country thought that the Prime Minister, like the Minister of Labour, was genuinely devoted to the cause of industrial efficiency and modernisation. They thought that the Prime Minister was the type of man who would be prepared to abandon the dogmas of Socialism wherever it was shown to be in the national interest to do so. In his speech yesterday afternoon about the future of the steel industry the Prime Minister confirmed once again that his contrived image of moderation and reasonableness is no more than a subterfuge to tide him over until such time as he believes that he will have a sufficient Parliamentary majority to discard the Liberal Party and to implement the will of the Left wing of the Socialist Party, on whose backs the Prime Minister climbed to power.

Yesterday the Prime Minister said this in the House: Public ownership of steel on the basis set out in that White Paper is and remains our policy, and we shall legislate to give effect to it."—[OFFICIAL REPORT, 9th November, 1965; Vol. 720, c. 38.] What the Prime Minister has done in fact is merely to postpone the evil day and to ensure that the issue will next be fought, not in the House of Commons, but when next we have a General Election.

All I want to say in the course of this debate about the steel industry is this. This is an industry where both production and productivity are shooting up, an industry which exports directly 20 per cent of its production and where a further 20 per cnt. of its production is exported indirectly in the form of steel-containing products, an industry which the National Plan itself presents as equipped with enough capacity to cater for the demands of the whole period covered by the National Plan. Yet, in the face of these facts, the industry is now to be left in a state of uncertainty until after the result of the General Election. There could rarely have been a more classic example of sordid party political manoeuvre without the slightest regard for the national interest.

Yesterday the Prime Minister told us that the issue was simply one of priorities. There was one service which the hon. Member for Ebbw Vale did the House this afternoon. That was to say that the reasons given publicly by the Prime Minister for the deferment of this policy are no more than a sham. The Prime Minister now tells us that the health of the economy must be the first consideration of the Government. Yet only three weeks ago he told the nation that the nationalisation of steel was "essential to the economy". He went on for good measure, no doubt in order to satisfy the hon. Member for Ebbw Vale and his friends, "We regard it as urgent". Urgent indeed!

Now that the right hon. Gentleman has had to forsake the refuge of the Parliamentary Recess he is once again shown to be what some of us have always suspected him of being—a master craftsman of evasion and double-talk. Even the hon. Member for Ebbw Vale made it clear in his speech this afternoon that he no longer trusts his own Prime Minister. I see the hon. Gentleman wagging his head. But yesterday in the House the Prime Minister declared categorically that he proposed to nationalise the steel industry. I have here a copy of this evening's Evening Standard which says that three more promises were apparently made at a Labour Party meeting earlier today. Yet this afternoon the hon. Member for Ebbw Vale said that he wanted a full explanation of what the Prime Minister's intentions were. In other words, he simply does not believe the leader of his own party.

This is all I have to say about the steel industry, because no doubt there will be other occasions when we shall have the opportunity of going into the merits of this matter. It is of significance that the next occasion on which the great debate will take place, as is clear from the statement of the Prime Minister yesterday, will not be here in the House of Commons, but in the country at the General Election.

This afternoon we had an account of the Government's social policy from the Chancellor of the Duchy of Lancaster, who made an agreeable speech, as always. But what a disappointed man the right hon. Gentleman must be. That he is a man of high ideals no one who knows him will deny, but the truth is that in one sector after another of social policy the social service Ministers have been thwarted. It is not their fault, but that is the fact, as I shall show. Yesterday evening, the Minister of Labour, speaking at Eastbourne, said: The main object in encouraging automation and other kinds of technological progress must be to benefit the people". How right he was. The truth is that all we do and all we want to do in the realm of social policy is dependant on a sound financial and industrial base. Today, the Chancellor of the Duchy put it in this way: the choice before Britain he said, is how high it is prepared to set its new social targets. The stronger the economy, the more we can do.

I want, therefore, to remind the House of the position we have now reached after 12 months of Socialist Government. The hon. Member for Dewsbury (Mr. Gins-burg) said that, after 12 months in office, the Government have a solid record of achievement behind them. Here are some of the facts. First, the balance of payments, on which the Prime Minister concentrated in his speech yesterday and to which one hon. Member after another has referred in today's debate.

The Chancellor of the Exchequer and all the members of the Government, quite rightly and justifiably, glean satisfaction from the renewed strength of sterling. But, when the Chancellor of the Exchequer speaks in the economic debate on Tuesday, he would do well to remind the British public of one fact which is known to every foreign banker in the world, but about which Treasury Ministers seem rather coy in their speeches. That fact is, that, during this first year of the Labour Government, the Chancellor of the Exchequer has had to borrow from the rest of the world £1,000 million, a sum as great as the whole of the nation's gold and convertible currency reserves. Every penny of this enormous burden of debt contracted by the Labour Government will have to be repaid, not by the Chancellor of the Exchequer, not by the Minister of Labour or by any or the other right hon. Gentlemen sitting opposite It will have to be repaid by the British people.

The other day, the First Secretary of State made this comment on our present position: We are embarking on a very exciting, dramatic and encouraging period in our national life". The right hon. Gentleman's assessment of the position has about as much validity as his promise of 3 per cent. mortgages.

The second fact which must be faced is the stagnation of industrial production. It is agreed on all sides that the pace of social advance is ultimately dependent on the level of industrial output. How on earth can the First Secretary of State continue to talk glibly of a 25 per cent. increase in output by 1970 when the latest figures show that the Chancellor's tax increases and credit squeeze have actually reduced industrial production to less than the level at which it stood in January this year? J noted last night that the Labour Party manifesto at the last General Election contained this delightful gem: Not even the Tories' stop-go policies have been able to prevent some increase in production. But that is precisely the achievement of the Labour Government during 1965 and, more than that, they have gone one better and have actually succeeded in decreasing industrial production!

What are the prospects for the future? No one will deny that a prerequisite of increased productivity and production is a high level of industrial investment. The Prime Minister recognised this in his speech yesterday. In an article published a couple of weeks ago, the First Secretary of State said: A faster increase in investment in manufacturing industry is essential to the whole Plan. It is vital that investment from 1967 onwards should be on a strongly rising trend, and this will be affected by decisions taken today. But under the present Government precisely the converse is actually happening. According to the estimates published in the Board of Trade Journal, capital spending in the second quarter of this year was considerably lower than expected—in fact, a fall of 3½ per cent. from the level of the first quarter. The latest industrial survey carried out by the Confederation of British Industries shows that the growth of investment is likely to slow down in the future. It is, therefore, not surprising that the Gracious Speech devotes a paragraph to this very problem. I remind the House of what it says: Steps will be taken to improve the arrangements for providing incentives for industrial investment with due regard to the development of the economy and the special needs of particular areas. The paradox is that only seven months ago the Chancellor of the Exchequer introduced a Finance Bill which actually cut the value of the investment allowances by a third, and when my right hon. Friend the Leader of the Opposition sought to restore that value, we were politely told that the Government would be looking into the whole matter during the coming year, and, apparently, they are still looking into it.

Perhaps the Minister of Labour, when he replies, will deal with the development districts, for which he has a special responsibility. Perhaps he will tell us what is meant in the Gracious Speech by the reference to: providing incentives for industrial investment with due regard … to the special needs of particular areas. I ask that question because when we on these benches moved an Amendment to the Finance Bill for differential investment allowances—in other words, for providing greater investment allowances —for the development districts the whole of the Labour Party in the House of Commons that evening trooped into the Lobby and voted against our proposal.

A third factor of vital concern for our industrial competitiveness to which the Prime Minister devoted considerable time yesterday is the whole complex of policies concerned with productivity, prices and incomes. This is another matter with which the Minister of Labour is directly concerned and a matter which has been referred to in almost every speech in the course of today's debate—with the exception, perhaps, of two—and certainly by my hon. Friends the Members for Kidderminster (Sir T. Brinton) and Twickenham (Mr. Gresham Cooke).

When some time ago I described the policy of the First Secretary of State as a monumental flop, he became very angry. But I would ask the House to consider in terms of hard facts just what has actually happened. The Ministry of Labour statistics show that since the General Election prices have increased by 4.7 per cent. There is no dispute about that. They have increased at a rate faster than they have been increasing in France, West Germany and Italy. One thing at any rate is clear. At last Britain is now near the top of one of the international league tables, the league table of rising prices. How on earth can the Chancellor claim, as he did the other day, that the Government's measures have already had the effect of slowing down price increases? The very reverse is the case. At least half the increase in the cost of living has followed automatically from the increase in indirect taxation which the Chancellor imposed on the nation. So one could go on.

In my constituency thousands of people in Altrincham and Sale have to commute daily to Manchester. The only road between the two boroughs and Manchester, as the Minister of Transport would be the first to agree, is one of the most congested in the country, and so for thousands of these people there is no alternative but to travel by train. I will read a paragraph from last week's edition of the local newspaper: A disastrous year for Sale commuters culminated this week with the announcement of British Rail that peak period return fares to Manchester will be increased from 2s. 5d. to 3s. 4d. on December 6th. There, in one fell swoop, is a crippling increase of no less than 40 per cent., and it comes on top of another increase earlier in the year.

As for the incomes policy, here again the published facts run completely counter to the picture being painted by the Government. Even the Chancellor of the Exchequer was constrained the other day to tell us that in the first eight months of this year earnings had risen by 8 per cent. Whether he meant 8 per cent. in eight months or at the rate of 8 per cent.

a year, in either event this is far in excess of any increase in productivity and shows that the Government's policy of holding the increase in incomes down to 3 to 3½ per cent. has been, so far at any rate, a dismal failure.

But of course it is little wonder that individual unions treat the Government's policy with derision. What chance has the Minister of Labour got? I know that he is sincere in his wish to try to keep increases in incomes in line with increases in productivity—an aim which will be shared by practically every hon. Member. But what chance has he of convincing individual union leaders that this is a policy which they ought to adopt when there, sitting next to him in the Cabinet, is the so-called Minister of Technology who himself has blatantly declared: We will not have wage restraint whoever brings it in. The Minister of Technology's differences with his Cabinet colleagues, perhaps rather like the Minister himself, were first regarded by most people in the country as something of a joke. But I must say that on a matter as fundamental as this his failure to resign is fast becoming a scandal.

The blunt fact is that 70 per cent. of the costs of production is accounted for by labour costs and that, so far this year, labour costs have far outstripped any gains in productivity. Incidentally—a fact which the First Secretary of State seems to ignore—wages have been rising even faster than prices.

I shall refer to one industry to illustrate the disastrous consequences which can flow from the present drift, and I am pleased that the President of the Board of Trade is here because it is an industry that we have not discussed for a long time—shipbuilding. Last week the Chancellor announced that the Bank of England was making a loan of £1 million to the Fairfield shipyard to prevent it closing down. A good many other yards are at present facing the most serious financial difficulties. Yet, despite this prospect, earnings in the industry are rising at a rate which makes complete nonsense of the statement by the Minister of State, Board of Trade, that the shipyards must cut their costs.

The Ministry of Labour has published the indices of earnings in the industry up to August. I have here the figures of earnings in one yard which, I am told, is not untypical. They show that between October last year and October this year earnings rose by no less than 19.3 per cent. It really is incredible, therefore, that anyone can seriously pretend that the incomes policy is succeeding.

On top of all this, the industry, as I am sure the right hon. Gentleman would be first to admit, is riddled with restictive practices. We are all in favour of the inquiry into the industry now going on under the chairmanship of Mr. Geddes, but it does not need an inquiry of any kind to highlight the restrictive practices already known to exist. The Minister of Labour will be the first to recognise the shortage of skilled men in the industry. He knows that one of the principal causes of that shortage is the nineteenth century "stick-in-the-mud" attitude to apprenticeships. I am told that for years certain unions—particularly the Boilermakers Society—have limited the intake of apprentices to a fixed ratio, quite irrespective of the need to increase the existing labour force. In the case of the boiler-makers, the ratio of one apprentice to five craftsmen is written into their rules and I am told that they adhere to this rigidly in most districts. Again, the industry has been satisfied for years that a five-year apprenticeship is quite unnecessary in most trades.

The Prime Minister is forever paying lip-service to a policy of rooting out restrictive practices—he did it yesterday —but what the country wants is an indication that something is actually being done about it.

In the ship repairing district on the Mersey there is what is called a burning agreement, which lays down the manning scale for the operation of burning machines, and which was concluded over 40 years ago. Today it is completely out of date but the Boilermakers' Society still insists on its implementation. In practice it works out that when five sets of burners are in use on board a ship, the scale requires the employment of 42 boiler-makers, no less than 32 of whom may be superfluous. How on earth can British shipyards be expected to remain competitive in the face of this sort of nonsense? These are the sort of practices which are crippling the shipbuilding industry at a time when its order books are crammed with orders worth over £350 million.

I recognise, as every other hon. Member in the House does, the difficulty of eradicating practices which are deeply ingrained, and I do not challenge the sincerity of the Minister of Labour in his efforts. I will say, however, that there are many people who are getting just a a little tired of the unctious moralising of the Prime Minister on the subject of restrictive practices, when he takes virtually no positive steps to do anything about it. Recently the hon. Member for Ebbw Vale said: The biggest threat to this Government is cynicism about politics, cynicism encouraged partly by the actions of the Government which in some respects, have done things differently in office from what they said they would do in Opposition. How right he was. I shall not easily forget, when I was Minister of Health, the reckless and grandiose promises which were made about hospital building. What now of the four new medical schools which were the present Minister of Health's specific promise, made to this House before the last election? What now of that paragraph on hospitals in the Labour Party's election manifesto which read: Labour will review the whole plan on the basis of a full assessment of local needs and provide the necessary finance to carry the plan through. Where is the reference to hospital building in the Queen's Speech? There was not a word, and why not? Because the Government's plan is to cut back on the projects which they inherited from the previous Administration. [An HON. MEMBER: "Nonsense."] It is no good crying "nonsense". In the last week or two—[Interruption.] In the last week or two the truth has been seeping out—

Mr. Speaker

Order. Shouting on either side is no contribution to the debate.

Mr. Barber

The truth has been seeping out. The £8 million general hospital for Exeter is to be indefinitely shelved. The rebuilding of the London teaching hospital of St. Thomas's is now no longer to be completed, despite the categorical assurance of the Chancellor of the Exchequer that the measures which he had introduced would not affect hospital building.

And what of education? There has been a cut back in the programme for higher education. This is well known and I need not refer to it again. What is not so widely known is that the Chancellor's restrictions are now working their way through to some school building. The right hon. Gentleman said, and I have no doubt that he meant it sincerely, that it was not his intention to impede school building. Let me give one example of the reality of the situation. There is a Roman Catholic school called St. Hugh's, at West Timperley, in Cheshire, which is at present too small. The Department of Education has approved the plans for an extension. All was set to go ahead until the general manager of one of the leading banks sent a letter to those responsible which included this paragraph: I am sure you are aware that the present financial climate is extremely difficult. The amount of money which the bank has available to lend is restricted by the directives which we have received from the Chancellor of the Exchequer through the Governor of the Bank of England. The only conclusion to be drawn is that, while the Chancellor of the Exchequer, no doubt with sincerity, says one thing to allay the concern of the general public, the actual effect of his policy on the ground is quite different.

In the coming days we are to debate a variety of other subjects—housing, the road programme, and so on—and I shall say nothing of them this evening. But there is one overriding consideration which now governs the presentation of their policies by the present Administration, and that is to prepare the way for a General Election. The Parliamentary Liberal Party, clinging to the coat tails of the Prime Minister with a humiliation which would have made their erstwhile leaders cringe, has forfeited any claim it ever had to independence. The choice before the nation is simple, and here I am at one with the hon. Member for Ebbw Vale: the sooner the Prime Minister puts the issue to the test the better.

9.31 p.m.

The Minister of Labour (Mr. R. J. Gunter)

Like the right hon. Member for Altrincham and Sale (Mr. Barber), I should hate to try to deal with all the subjects which have been touched on in today's debate. As he said, the debate has ranged over a very wide field. I am no expert on abortion or Scottish law or any of those things, and therefore I think that it would be desirable if I were to confine my remarks principally to dealing with the latter part of the speech of the right hon. Member for Leeds, North-East (Sir K. Joseph) in which he spoke about industrial relations, restrictive practices and legislation. I hope that I may say without offence that the speech, excellently delivered, was more indicative of the midnight oil than of an appreciation of what makes British industry tick over.

May I say to the right hon. Member for Altrincham and Sale, who dealt with restrictive practices, that those practices were in existence in September, 1964. I do not remember the Conservative Party taking any dramatic and dynamic action to deal with what has been a problem in this country for many years; and nobody can deny the nature of that problem.

I hope that any approach to industrial matters in the House or on the political platforms outside would recognise that Ministers of Labour in previous Administrations tried to grapple with the question of getting industrial relations on a belter footing. Indeed, I know that careful consideration was given by right hon. Gentlemen opposite who preceded me at the Ministry to the question of how legislation might be possible and, if it were necessary,, how it could be implemented. They came to the conclusion on many occasions that the implementation of good industrial relations merely by regulation or legislation was quite impossible and that in industrial relations, when men gather at their place of work and are subjected to strains and stresses, no amount of legislation will automatically bring industrial peace. I think that we all recognise that.

We do ourselves no good by painting too gloomy a picture of this country. There are vast areas of British industry which are a model to the world. People often talk about strikes. I am not complacent about this matter. I am very unhappy about many of the disputes in British industry. However, the position in many other countries is far worse than it is in this country. America's record, where legislation has been introduced, is much worse than ours in the number of days lost through industrial disputes. If my memory serves me aright, for every 1,000 workers in America, 1,044 working days a year on average are lost, which is far in excess of the number in this country. Over the last ten years, in the table of the 18 leading industrial countries, taking the United States at the top with its appalling record, we are down in twelfth position. The picture, therefore, is not quite as bad as it is painted, although that is not for one moment any reason for complacency.

One of the problems which I have to face and which worries most of us is the nature of the strikes in this country, the unofficial character of them and the indiscipline that is indicated by unofficial action. For heaven's sake, however, do not let us paint a picture of this great nation among the industrial and trading nations of the world as being one of the most hagridden. It simply is not true.

I thought that tonight, in reply to what the right hon. Member for Altrincham and Sale has said, I would try to point out that things are moving. Certain things are happening. I never find any consolation in comparing our record with other nations and saying that we lost only a certain number of days in strikes this year. That is a bit daft and childish. What we want to do is to come to grips with the problems that arise from restrictive practices and unofficial action that impede the greater productivity that we want.

The right hon. Member for Leeds, North-East, who opened the debate for the Opposition, wound up his remarks by saying that the policy of the Government in industrial relations was ineffective and evasive. Those, I think, were his words. I am not sure what they meant, but I will reply to them in the best manner I can. In the first place, one of the great problems that faced the last Administration was the problem of the docks, which has been a running sore in the economy of the country for a very long time.

Various Ministers of Labour have tried to handle this problem of the docks. Believe me, I know the difficulties of the docks now if ever I did. Therefore, I can understand the dilemma of previous Ministers of Labour. Whatever has happened in the last 12 months and whoever may claim credit for it, at least we have got under way the things that flow from the Devlin Committee. That Committee's Report was published on 5th August, and I undertook to report to the House when we came back how we were getting on.

Hon. Members will remember that that Report set out a bold and comprehensive plan of action by the Government, the National Dock Labour Board, the employers and the unions. They were asked to engage in the task of a radical improvement in industrial relations in the docks. The essential element of the plan was the final disappearance of the casual system of employment. There are right hon. and hon. Members on the Front Bench opposite who know that this is the nub of the problem in the docks. This has been the curse of the docks for many years. It was, and remains, one of the principal causes of trouble in the docks. Lord Devlin recommended the introduction of regular, permanent employment for all dock workers, a drastic reduction in the number of port employers, the abolition of restrictive practices, reform of the wage structure and the provision of proper welfare facilities for dock workers.

The House will know that immediately following publication of the Report I held a series of meetings with those principally concerned, the employers and the unions represented on the National Joint Council for the Port Transport Industry, representatives of the National Amalgamated Stevedores and Dockers Union—the "Blue" union—the Chairman of the Ports Council and the rest. We have tried desparately—and this is why we have not been ineffective in this major problem—to get an element of urgency and speed into this tricky problem. We have obtained the co-operation of the interested parties, but, whatever will be the outcome of the negotiations, there was a need for a new and radical approach to these old problems. I am glad to inform the House tonight that—I am not going to report that we are out of the wood; we may yet run into troubled waters—at least encouraging progress has been made over the last few months.

On 2nd September the National Joint Council for the industry issued its national policy directive. That directive dealt with the main problems which had to be handled and for which solutions had to be found.

I want to say a word here about one aspect of the problem. This is the first time that we have been able to make the breakthrough of getting the two unions together and to enable the National Amalgamated Stevedores and Dockers to have a seat upon the negotiating committee, the Modernisation Committee. So please do not let anybody suggest that we have not done anything. This, in a way, could be of major importance to the whole of the docks in this country, the fact that we have at last been able to get the two unions to come together.

The Committee is meeting regularly, and has a deep sense of urgency. Since it was established it has had seven full meetings and there have been a large number of meetings of sub-committees. The Committee is alive to the need for keeping everybody in the industry informed of the progress made. So this new approach is being made in the docks. The Modernisation Committee has issued its bulletin to every single docker in the country explaining what are the problems and what may appear to them to be the solutions.

I think hon. Members in all parts of the House should realise and will realise the size of the task with which the Committee is now grappling. I said a moment ago that we may run into troubled waters. I am not disguising the fact that it involves a fundamental reorganisation of an extremely complex industry, and difficult negotiations on the terms and conditions which are to apply under the new scheme of employment. I repeat, the Committee has been working at a fast pace and has covered a lot of ground. I want to tell the House that a lot more time will yet be needed, but I am determined that we are going to come to grips at last with the desperate problems which arise out of casualisation. We are going to make a reality of decasualisation and hope to get the unions and the employers together in negotiations on this within the next few months.

I referred to the unions. We all recognise that there are far too many employers in the industry at the present time. Many of them employ dock labour only intermittently. There must be a drastic thinning out of them. I am going into some detail on this because it may be one of the great examples of how, under the spur of what I consider to be an almost inspired Report, by getting the unions and the employers working in conjunction with the Government, we can break through the mess and chaos of many generations. It will involve a completely new structure, and, by heavens, it is going to be difficult to get the employers to accept something which is fundamentally different. I would not like anyone, therefore, to under-estimate the difficulties which we have in this work.

The Dock Labour Board is at a very great pace conducting a whole survey of welfare facilities and amenities, and talks are proceeding about responsibilities for the provision of amenities in the docks. And so this radical effort is being made with a great sense of urgency. So I would beg the right hon. Gentleman the Member for Altrincham and Sale to realise that at least here is one field where we are trying desperately to come to terms with a problem which did not arise in October, 1965; this was an inherited problem. Indeed, I remember reading that it was called the chaos of generation after generation. But we are at last trying to come to terms with it.

Now I turn to another area which has been much under fire in the country, because of the appalling number of unofficial strikes which have taken place. Much has been said about the need for industrial efficiency. If there is one industry in the country at the present time that we want to see moving as efficiently, quietly and responsibly as any other it is the automobile industry, because it means so much to the economy. It is an industry which has been bedevilled by unofficial strikes. I decided, with the consent of my colleagues, to try to bring about a break-through in that field. We had a situation where obviously there was great hostility between the employers and the unions. There seemed to me to be no roots in the industry. It was new, and there were no traditions. There seemed to be no effort being made to come to terms with the rash of unofficial strikes, so we persuaded them to do something. I do nor, know whether right hon. Gentlemen opposite agree with it or not, but at least one has to try things.

We persuaded them to accept an independent chairman to preside over a fact-finding or trouble-shooting commission which would go immediately to the point of trouble. In the end, they accepted it. I do not know what success it will have. All I know is that it is a new experiment in industrial relations to try to make a break-through in a field where there is so much trouble.

I do not want to enlarge upon it, but there is a lot going on, and it would be a pity if any hon. Member thought that the situation was still stagnant and that no effort was being made. Hon. Members opposite know it, because they are interested in industry. There are hundreds of small and medium size firms in the country which are setting an example in the removal of restrictive practices. One can feel the movement in industry, where they are coming to terms with something that has been traditional.

Do not let us paint a picture of everything being wrong in the country. One can take the example of the national newspapers, where we have a joint board under Lord Devlin to see what is happening. It appears to me from reports I have that the Newspaper Proprietors' Association and the unions, working under the chairmanship of Lord Devlin, are now coming to terms with much of the inefficiency that exists there. One can take the example of the petroleum industry. Esso, Mobil and Shell have recently established agreements providing for more flexible working between crafts and between craft and process workers. In electricity supply, there has been a major breakthrough in the fields of staggered working, the reduction of overtime and many other things. In the field of chemicals, the same story can be heard.

What I am trying to say tonight is that—though I am not quite sure that everything is being done—it is in the right direction. The subject is so complicated. But at least there is a movement in industry in the right direction. There is a growing awareness of the situation and a willingness to get away from the traditional pattern of restrictive practices of which the right hon. Gentleman spoke.

Now may I turn for a moment to the subject of legislation? I would suggest with great respect that the right hon. Gentleman ought to have had prior conversations about legislation with his right hon. Friends who have been Ministers of Labour, because it is the trickiest subject in the world. This afternoon, I interjected—and I use it now as an example —that the great argument is that, once there is a collective agreement established, it becomes enforceable in law. I am not disputing that argument, but following it. It becomes binding on those who are party to it. If that be the case, despite what the right hon. Gentleman said this afternoon, it follows as night follows day that if a collective agreement is going to be enforced, everyone has to be party to it. There cannot be some people who are not party to it.

One can take, for example, a workshop which is 60 per cent. organised and of whom 40 per cent. do not belong to a union. The right hon. Gentleman would say that it is the 60 per cent. who cause trouble but, if there is one supreme fallacy, it is that the non-unionist does not cause trouble in industry. We could have a situation where 60 per cent. of the men are bound by law as part of a collective agreement, while the other 40 per cent., who do not belong to the union but who enjoy the benefits of the collective agreement, are outside the law. This is a wonderful situation. I know a little about the trade union world. I can see some of the boys sitting down to find out how to get round this one.

Sir K. Joseph

I am new to this field, but I have read as widely as I can in the time available. I understand that a non-unionist generally has written into the terms of his contract of employment the terms of the agreement between the management and the union. I believe that this is true, in which case the individual is bound by those terms.

Mr. Gunter

I am sorry. I do not want to pursue this, but the point is that if a union makes a contract with the employer and it becomes legally binding on those who are party to the contract, obviously someone who is not a member of the union and who has not participated at any stage of the machinery in making the agreement cannot be held liable. The right hon. Gentleman shakes his head. What I am trying to say is that the natural corollary to this is the closed shop.

Let us be clear here. Though many of my hon. Friends do not agree with me. I have never accepted that the closed shop is a desirable thing in a British society, but, unfortunately, I am coming to the conclusion that it is almost inevitable. If we are going to talk of this sort of legislation—and the employers themselves are now more desirous of the closed shop than the unions are for the reasons .which have been adduced—then I had better ask the Conservative Party to come clean. Is it in favour of the closed shop in modern circumstances?

Mr. John Page (Harrow, West)

I think it is fair to say that negotiated agreements are legally enforceable in virtually every industrial country in the world. They are enforceable in Sweden, Japan, Germany, France, and Italy. Why does the right hon. Gentleman say that as night follows day we must have the closed shop? One does not have it in those countries.

Mr. Gunter

That is indicative of the state we are in. The closed shop exists in America. It exists in the majority of the great plants there. If hon. Gentlemen opposite ask Walter Reuther, he will tell them what to do with non-unionists. His agreements are based on 100 per cent. membership, yet the hon. Gentleman asks me why I say that as night follows day we will have the closed shop. I sometimes wonder about the legislation which enables Walter Reuther to get away with the closed shop and collective agreements, because America has the worst record in the world for days lost through strikes. Let us be careful when we talk about legislation, though I do not dispute that it may come.

I turn for a moment to deal with the Royal Commission on this matter. I have said before in the House that it is desirable to have a long, cool, look at all its aspects. When the right hon. Member for Leeds, North-East says, "But what we want is a Royal Commission to sit down day after day for a short time "all I say is that men cannot operate like that in an issue as complicated as this. We are dealing not only with the legal aspects, but with certain things that are fundamental to the standards of this country.

The Royal Commission has issued a questionnaire to 2,000 employers' associations, unions and other interested people. How can men absorb evidence of this voluminous character if they have to sit down and make decisions day after day? But, of course, I hope that the Royal Commission will come to terms with some of these problems as early as possible. I do not think for one moment that we can come to terms with these problems by demanding that these men should sit down for a short period and come to decisions. There are many things which must be reflected on in this matter. I therefore suggest that we should not be too cynical or critical about the Royal Commission but should allow it to get on with its job.

Now the evidence is pouring in from my Ministry and now from the A.E.U., and they will be followed next month by the C.B.I. Then we shall be able to come to terms with some of these problems. I say to hon. Members opposite that the suggestion made by the Leader of the Opposition that they will introduce legislation of this or that sort is unwise. An unofficial striker does not regard himself as a criminal. Do hon. Members opposite really believe that many unofficial strikes of the kind which now take place will be stopped because the boys will think, "I shall be hauled up in the courts if I do this"? That is a fallacy.

The right hon. Gentleman knows better than I do what happened in the war. Under Defence Regulation 1305, no fewer than 1,000 miners were prosecuted. Large fines were imposed on the seven who led them and lesser fines on the 993 who followed. What happened was that the boys said, "We shall not pay. Please send us to gaol." But there were not enough gaols available. Let us be sure, before we bring in any legislation, that we are carrying most of the people with us and making that legislation acceptable and enforceable.

I now turn to the question of steel. I can only repeat what my right hon. Friend the Prime Minister said, and what is my conviction also. I believe that in the end the public ownership of steel is essential to the wellbeing of the country. But I also believe that it is a question of determining the priorities. We believe that the priorities contained in the Gracious Speech are those which the country wants, and we will implement them. Does anybody suggest that people are not interested in housing, or rating? As a great democratic party we have given priority to the things that the people want.

I will only say that I hope, especially with respect to industrial relations—and I say this with great sincerity to the right hon. Gentleman—that we can keep to those matters which are of so much interest to us all and allow other people to row about steel.

Debate adjourned.—[Mr. Harper.]

Debate to be resumed Tomorrow.