§ Where any contract for the carrying out of works or the supply of goods or services has been entered into prior to 23rd June, 1966 and contains any provision for the contract price to be varied by reason of alteration in costs or in any rate or tax or imposition other than selective employment tax then the provisions 792 of section 42 of the Finance Act 1966 shall be deemed to be such an alteration as aforesaid and the contract price shall be varied in accordance with the contract or as near thereto as the circumstances allow to the extent that a refund of selective employment tax is not paid or payable under this Act.—[Sir J. Hobson.]
§ Brought up, and read the First time.
793§ Sir J. HobsonI beg to move, That the Clause be read a Second time.
The Clause seeks to deal with a problem which will arise from the imposition of the tax. One or other of two parties to a contract will have to bear the burden of the tax which falls upon employed persons. This goes over the whole field of contracts. It particularly affects the construction industry, which is not to get any refund. It affects electrical contractors. It affects all other people with a staff and who have made long-term contracts by which they are bound and who are not entitled to any refund.
What is the fair and equitable way of dealing with a situation which the Government have created and which neither of the parties to a contract could have foreseen? The electrical contracting industry provides an example of the effect that this will have. Electrical installations firms belonging to their association carry out about £150 million worth of installation work each year, much of it on fixed-price contracts running for up to two years and in some cases five years. The previous Government, this Government and the local authorities have been increasingly trying to secure that people tender for work upon the basis of fixed-price contracts, to give them the economic stimulus of making a profit out of the fixed price and not upon a cost-plus basis, when it does not matter how efficient they are.
8.30 p.m.
A contractor whose fixed-price tender was accepted before the Chancellor's announcement must pay the tax from September, with no chance of recouping the additional expenditure, which he could not have allowed for when he tendered. On present figures, the tax will increase the industry's labour costs by about 10 per cent. and reduce profits to one-third of their present level. The effect in other industries is likely to depend on the extent to which the long-term contracts they enter into contain a higher or lower proportion of labour cost in their costing element. The contractors' liquid capital will be depreciated with no chance of recouping the additional outlay. At the same time, in electrical contracting the electricity boards will be operating in direct competition with the private firms on existing contracts on which the boards will receive a refund and lose no finance.
794 That is a special case, but the matter goes much wider than that of these two principal industries and anybody who, before the announcement of the tax, entered into a long-term contract running over a period of more than six months is likely to be in a serious position.
How should one equitably deal with this? It seems to us—I do not say that it is right, for there are many different views—that a fair way is to say that if a man entered into a fixed-price contract making no provision for variations in cost he had assumed to himself the risks of future events, whether acts of God or of the Government, and that he should, therefore, bear the loss, however unfair it might be for the Government to impose it on him. As between him and the other party to the contract it was only fair that he should bear the burden of the tax.
But there may be many contracts intended to provide for future events in which it is specified that some form of rate or tax, some alteration in cost or some other imposition, should entitle the contractor to pass on the burden to the other party to the contract, but no such contract entered into before 23rd June, could have specified the Selective Employment Tax because nobody would have foreseen that such a tax would be imposed.
Therefore, it seems fair to us that if the contractor had given himself an escape clause by which he could pass on additional costs which were beyond his control, but he had not been able to specify the tax in his contract because he could not have foreseen that it would fall upon him, it would be fair to add, as it were, an interpretation clause so that he could say that, while he had not actually provided for it, his contract should be read upon the terms that it was specified, because he had tried to provide against such risks and should, therefore, be able to pass it on.
One of the great troubles is that this proposal was put down earlier in the form of an Amendment, but was guillotined and never discussed. This is the first opportunity we have had to discuss it, and we have about half an hour left to consider the most important and difficult principle of how the balance of equity between two innocent parties to a contract should be preserved, the 795 burden which the Government impose being distributed between them in the right way. There is no possibility of the Clause being taken away and being considered by the draftsmen. There is no chance of our having the advantage of the Government's own solution to this difficult problem.
The House is put in the thoroughly awkward position of either having to accept the Clause or doing nothing about it at all. I should be the last person to suggest that this is the ideal solution, but it is at least an attempt to deal with the very difficult predicament in which the Government have placed parties to contracts.
§ Mr. A. P. Costain (Folkestone and Hythe)I support the new Clause, and in doing so I must, of course, declare my interest as a contractor.
A matter of great principle is involved there, the question being whether any Government can interpose between two contracting parties and put upon one of them a burden which he had no reason to expect when he prepared his tender. This is important enough, but when the Government themselves are parties to a contract, what right in equity or common law can they possibly have to impose upon the other party a penal sanction?
We are discussing this principle in the context of the tax as at present proposed, but the Chancellor has said that it is to operate at first for a trial period. We do not know what will come in the future. Income Tax started at a very low rate and on a yearly basis. When the Chancellor finds that his present proposals will not work, what will he add to the tax? It could be doubled or trebled. It could lead to the breaking of a number of companies. Is that what the Government want? In their plunge towards Socialism, which will lead to Communism, is this a trap designed to lead to the breaking of ordinary private enterprise concerns? If they want a more efficient way of doing it, I cannot suggest one; there could be no better way of breaking a firm, particularly the small firm.
My right hon. and learned Friend the Member for Warwick and Leamington (Sir J. Hobson) has explained the difficulties in preparing a Clause of this 796 kind. But the principle behind it is clear. We ask for equity between the two parties. If the Government oppose the Clause—I cannot think why they should—it is up to them to introduce something on similar lines which, in their view, would be a better piece of drafting. It would be utterly wrong if the House of Commons were to accept that the Government or any parties to a contract could unilaterally alter the contract to their own benefit and to the detriment of those on the other side who show enterprise in entering into the contract.
This must of necessity be a short debate. Although I have put my point briefly, I want it to be understood as of vital importance to the whole future of the contracting industries. I refer not only to building contracting but to contracting as a whole. If we accept that any Government could impose taxation in this way at their own will, when and how they like, the whole basis of private enterprise must in the end perish.
§ Mr. GowerLike my hon. Friend the Member for Folkestone and Hythe (Mr. Costain), I have to declare an interest in this matter, because I, too, am a director of a constructional engineering company. I agree with my hon. Friend that there is here a matter of what he called a great principle; I think it goes as far as that. It is certainly one of major importance to contracting companies of all kinds. It is possible, of course, that the Government may plead against our case that any person who enters into a fixed-price contract might be deemed to foresee the possibility of future increases in taxation. I suspect the Government may invoke that kind of argument and in that respect they might plead the fact that Income Tax can be raised, that Corporation Tax can be increased and that the taxation of materials used in contracts can also increase, putting up the price. But I would respectfully submit that tax increases of those kinds are different from that which we are now considering.
For example, if the Corporation Tax were increased it would affect the whole gamut of companies, and if Income Tax were increased it would affect the whole range of persons who pay personal Income Tax. Similarly, if the cost of certain materials rose; sometimes there are clauses which provide some help in 797 that respect, and certainly if the cost of labour goes up, as my hon. Friend knows, there are clauses which enable adjustments to be made. But here we have an almost unique kind of tax, one under which arrangements are made for the repayment or refund of tax to some categories of persons while in other cases premium payments are to be made to some kinds of manufacturers; and we have only a limited body subject to the full ravages of this particular tax.
Unfortunately, many of us regard contractors and builders as creative persons after the same genre as manufacturers, and it is extraordinary to me that they should be treated as service industries or something within that category, because they have created as much of the wealth of this country in some spheres, and certainly we know the contribution of contractors to our overseas exports is not negligible.
My hon. Friend the Member for Folkestone and Hythe is associated with subsidiary companies which have done a magnificent job in different parts of the world, including Australia and the Continent of Africa, and it is extraordinary to me that they should be placed in this unsatisfactory predicament by this part of the Bill. We want to protect them from the worst ravages, because we think it is wholly indefensible for this hardship to be imposed in this way. What is more, the tax not only affects some in a small category, but we find that in some cases some of their competitors, as in the electricity contracting industry, the Electricity Boards, are not treated in the same way, so that the full burden of this tax really falls on comparatively few shoulders. It is an extraordinary state of affairs.
The best solution would have been an arrangement by which these people could have been treated as manufacturers. But we have not got that solution so as my hon. and learned Friend has pointed out, we have had to improvise another kind of solution. I believe with all its imperfections it would at least do something to remedy the manifest injustice of the Clause as it stands—because who in his right senses would enter into a fixed-price contract if he knew he would be prejudiced in this way by legislation brought in shortly afterwards? In the absence of a proper arrangement to give 798 them a premium, there could have been transitional arrangements which would have enabled those who had entered into contracts immediately or shortly before, or within a limited time before, the publication of the Bill to work them out, but such arrangements are lacking.
8.45 p.m.
It will be infamous if the Government are not prepared to make any sort of concession. Some of the smaller contractors work on extremely narrow margins and even with that without impositions of this kind, it is sometimes a very delicate operation to meet a price. Our climate is so uncertain and all the circumstances of engineering and building in this country are so uncertain that these factors often make the difference between doing a job economically and at the contract price and making a small profit and suffering a financial loss and possibly liquidation or bankruptcy very fine. This could be what would tip the scale towards liquidation and bankruptcy for some quite reputable companies who have been in business for a long time. It could be the final straw which will break this camel's back and I implore the Chief Secretary to consider the new Clause in that light.
§ Mr. John E. Talbot (Brierley Hill)I am not connected with the contracting industry, but as a company lawyer I am interested in how these provisions in the Bill are to work, for I believe that they will create a great deal of hardship. We do not want to discourage the principle of making firm contracts for the supply of goods and services. It is to the advantage of both sides to such a contract that there should be a measure of stability. But if the Government are suddenly to produce a new tax—and heaven knows we are not at the end of the road yet and that further new taxes may be invented by their Hungarian ingenuity—how can anybody assume the risk of taking a firm contractual line over a period? To do so would be sheer economic suicide. In any stable economy it is essential that contractors and local authorities and others who have to deal with them should be able to plan ahead with a measure of stability and certainty.
I have had representations from my constituency from electrical contractors and others who will be in direct competition with the nationalised industries which 799 will get the refund while they will not. It is only a partial measure of justice to such contractors that the Government should accept the Clause. How can a man plan anything in any business without knowing something of what the future is to be?
It is not a parallel that Income Tax may go up and that Purchase Tax may go up and that other liabilities of that type may suddenly be imposed by Government action. Those are snags of which we are all well aware and when making contracts we certainly do not assume any reduction in taxation in the foreseeable future. But when the Government suddenly produce an entirely different tax, constituted on an entirely different idea, selective and attacking the unfavoured few and not the favoured many, it is only just to take account of such matters and to ensure that the loss does not fall on those few. Wages and prices are to be frozen and only rates and taxes are not to be frozen. The question before us is where that liability is to fall. In this case it is unjust to make it fall on the contractor and I hope that the Government will accept the new Clause.
§ Mr. Eric Lubbock (Orpington)I would like to endorse what has been said so far, particularly by the right hon. and learned Gentleman the Member for Warwick and Leamington (Sir J. Hobson) in his introductory speech, when he said that it was wholly unsatisfactory for the House to have to deal with such an important matter as this within the confines of an extremely short debate. We shall have no time to consider what the Chief Secretary says in his reply and to come forward with fresh suggestions in the light of the reply.
This is a particularly unsatisfactory position because, as the right hon. and learned Gentleman said, when we come to some conclusion this evening, we cannot subsequently embody it in legislation because we have now reached Report and we are shortly to rise for the Summer Recess. If the Government have some alternative suggestions to make which will meet the points raised from this side of the House it will be impossible for them to give effect to them.
I have some reason to suppose that the Government are sympathetic to the 800 case put forward, because I have been studying a speech made by Mr. D. J Harrington, who is President of the Federation of Registered House-Builders. Mr. Harrington made the speech at a conference of house builders, called, I think, at the instigation of the Minister of Housing and Local Government to discuss the private house builders' problems. This conference took place on Tuesday, 2nd August. I would like to quote one paragraph from the speech of Mr. Harrington. He said:
The Ministers concerned have already accepted the justification for this tax being treated as an ex gratia recoverable cost in Government and local authority building contracts negotiated before the advent of the tax, and, furthermore, local authorities are being permitted to re-negotiate contract prices for housing contracts in those cases where such contract prices were submitted prior to the introduction of the tax and where the effect of the amount of such tax could not therefore have been included in the sum tendered.In passing, I would like to declare an interest as a house builder in a very small way. It is the small house builders who are suffering most from the present economic situation, and I would commend Mr. Harrington's speech to the Chief Secretary, because it shows that this tax is the culmination of many serious difficulties which have been placed in the way of the small house builder. My point is that, if the Government have accepted this position, as Mr. Harrington says, they have seen that in the case of particular contracts the Government have to design a way in which contractors will not suffer from a tax which they could not possibly have envisaged when they entered into these arrangements. The Government are, therefore, in duty bound to accept the Clause or to suggest some other means of arriving at this particular objective.
§ Mr. DiamondI thank the hon. Member for Orpington (Mr. Lubbock), who has deliberately curtailed his speech so that I could address the House. He was the third person to declare an interest as a contractor. Let me be the fourth and say that I was for a great number of years but am no longer, the financial director of a large firm of contractors and that I have some little knowledge of the problems and understand pretty well the way in which matters have been put. I had first better remind the House very 801 shortly of what my hon. Friend said when introducing his Budget.
Then he made it clear that it was not the intention of the Government that the whole of the cost of this tax should be passed on. Everyone recognises that there are two parties to a contract. One is called, for the sake of convenience in the civil engineering and building sphere, the contractor, and the other is the customer. What one has to do is to try to look sympathetically at both parties and see if a case has been made out. Except for the right hon. and learned Gentleman who dealt with this most fairly and put it forward as an admittedly difficult question, the case so far has been made out entirely from the point of view of the contractor in a technical sense.
First, it was said that the Government, as a matter of honour, should be reasonable about contracts into which they have entered having regard to the fact that they impose the taxes. I thought that we responded to that point fully. I draw attention to column 980 in HANSARD of 21st July where I gave the exact details of the way in which the Government proposed to deal with their own contracts. I said:
Departments may agree to pay up to 90 per cent. of the ascertained extra cost to the contractor resulting from his Selective Employment Tax payments in respect of personnel employed on the construction site only."—[OFFICIAL REPORT, 21st July, 1966; Vol. 732, c. 980–1.]Different arguments were to apply to term contracts where Departments would be authorised to pay up to 100 per cent. of the extra cost. I made it clear that the contractor would recover about 75 per cent. of the increased cost of the tax. It is not the intention of the Government that any contractor should cover 100 per cent. of his increased costs.The right hon. Member for Enfield, West (Mr. Iain Macleod) said that in his own banking firm as soon as the Budget was announced he and his co-directors sat down to consider how they could, by economies and greater efficiency, absorb as nearly as possible the whole tax. I am sure that that is what many businessmen have done. Therefore, it is obviously impossible for the Government to propose, never mind to legislate, to contractors or to the world at large that a fair arrangement would be for one party to a contract to pay to 802 the other 100 per cent. of the tax. In the majority of cases a firm may be completing a civil engineering or electrical contract for a firm which has to pay Selective Employment Tax. It would be wholly wrong for the Government and against their policy, to propose in any single case that 100 per cent. of the tax should be passed from one party to the contract to the other. The Government are acting in a very reasonable way regarding their own contracts. They are setting a course of conduct which they have deliberately said that they hoped local authorities and similar bodies would follow.
All that I can say about private contractors is that I take the right hon. Gentleman's point. He proposes this as an interpretation Clause to the variation clause. He starts on the basis that if a man enters into a fixed price contract he takes a gamble on what happens and acts accordingly in his costings. That is a proper, wise piece of business foresight—I do not want to use the word "gamble". It is a calculated risk. There is a great deal to be said for entering into contracts on that basis. It is sensible, especially in these times, that there should be an extension as far as possible of fixed price contracts. I accept the argument of the hon. Member for Folkestone and Hythe (Mr. Costain) in that respect. But this Clause deals with the situation in which there is a variation clause and therefore the assumption that the two parties are aware that circumstances may arise in future which will cause them to vary the price agreed in the contract.
Nobody could have anticipated this tax. It is a new form of tax Nevertheless, this kind of variation clause indicates the kind of relationship in which the two parties can get together as reasonable businessmen who hope to do business together in future and say to each other, "The Government are doing so-and-so. We are doing the best we can. We do not expect you to carry the lot. We expect a reasonable compromise arrangement to be made."
I am sure that that is the best way. Any kind of imposition by law would be bound to affect one party differently and disadvantageously from another. But circumstances will vary very considerably, and I should have hoped that the ideal 803 way of giving effect to what is in everyone's mind is that there should be a reasonable discussion between the two parties to the contract, knowing what is in the Government's minds, knowing that it would be right for there to be some sharing in this, and knowing that it would be wrong for the whole of the tax to be passed on by one party to the other.
§ 9.0 p.m.
§ Sir Gerald Nabarro (Worcestershire South)The Chief Secretary's reply was most unsatisfactory. I have spent my commercial life entering into fixed-price contracts—[Interruption.]Does the Financial Secretary wish to intervene?
§ Mr. MacDermotAll that I did was to express the opinion that I am sure that the hon. Member for Worcestershire, South (Sir G. Nabarro) draws them very well.
§ Sir G. NabarroThe hon. and learned Gentleman is a "silk", and, before he went into the Treasury, it was his business to advise people how to draw up contracts. If I had taken the advice of "silks" all my commercial life, I should have been in Carey Street years ago.
Any businessman accepts reasonable hazards and risks when he enters into a fixed price contract. What he does not expect is what is tantamount, to my mind, to force majeure in a fiscal sense, having foisted on him a large additional impost which could not be foreseen. Having regard to those circumstances, it would not be unreasonable for the Treasury to make a relaxation in the Selective Employment Tax. That is the point of principle.
The second point is one about which I feel much more strongly. The behaviour of the present Government has been loaded against private enterprise industry and contracting—I call it anti-business—from the first day that they came into office. The businessman today is harassed and overburdened with taxation, regulations, bureaucratic interference and controls. As the First Secretary has said, they are more bigoted in a doctrinaire sense than ever before. Never has there been the epitome of bigotry manifest so loud and clear as the discrimination in this Bill for nationalised industries and against the private contractor.
804 My hon. Friend the Member for Brierley Hill (Mr. Talbot) put the case admirably. He did not exactly draw attention to what I wish to draw attention to now in the context of what I have said about discrimination.
Schedule 1 of the Bill delineates——
§ Mr. SpeakerOrder. We are not discussing the Schedule.
§ Sir G. NabarroNo, Sir. I know that we are not. I am making a passing reference to it.
Part I sets out a list of public bodies, the fourth of which is an area electricity board. In the case of the Midland Electricity Board, it is extensively engaged in electrical contracting in competition with a host of private enterprise firms. The board will get its Selective Employment Tax refunded to it, but the private enterprise firm competing with it will not. The electricity board is already heavily subsidised from the Treasury, because it borrows its capital moneys at a preferential rate which is much lower than that at which private industry can borrow. The board will have its tax refunded for a specific contract in respect of the men employed on it. A private enterprise firm, competing for the same work in the same circumstances, will not.
That is a piece of deliberate fiscal discrimination against the private enterprise firm, and perhaps the hon. and learned "silk" will laugh that one off.
§ Mr. Diamond rose——
§ Sir G. NabarroNo. I am not giving way. Be seated. I beg your pardon, Mr. Speaker. I was addressing the Chief Secretary. He was very rude to me the other evening and would not give way during his speech. I say to the learned silk that perhaps he will rise later, if there is time under the Guillotine, and deny that that is a piece of Socialist bigotry and fiscal discrimination against the hard-pressed private enterprise contractor.
§ Mr. DiamondI am grateful for the opportunity to say that, although this is not part of the Clause which we are discussing, had I known that the hon. Gentleman intended to discuss this, I would have been able to say, "My hon. and learned Friend can say that this is unfounded. The two will compete on fair terms", and had I had the time I would have explained why.
§ Sir G. NabarroThousands of men who are engaged in private enterprise and contracting are very anxious about this matter. Every Member on this side of the House has had a circular from his association defining the reasons for their anxiety. How is it that the Chief Secretary has not publicly given an acceptable answer to this?
§ Mr. DiamondBecause I prefer to make the statement to the House first.
§ Sir J. HobsonI raised it in my speech. Why was it not answered if the Government had something to say?
§ Mr. DiamondBecause it did not—
§ Mr. SpeakerOrder. We cannot have three interventions at once.
§ Sir G. NabarroI am a generous character, and I believe in giving way to my right hon. and learned Friend, but I will happily sit down and, in the 30 seconds remaining, give the Chief Secretary an opportunity, if he has your permission, Mr. Speaker, to tell the House why I am wrong.
§ It being seven minutes after Nine o'clock,[Consideration of the Bill having been entered upon at seven minutes after Four o'clock], Mr. SPEAKER proceeded, pursuant to Order[18th July], to put forthwith the Question already proposed from the Chair.
§ Question put, That the Clause be read a Second time:—
§ The House divided: Ayes 182, Noes 265.
809| Division No. 159.] | AYES | [9.06 p.m. |
| Alison, Michael (Barkston Ash) | Fraser, Rt. Hn. Hugh (St'fford & Stone) | McMaster, Stanley |
| Allason, James (Hemel Hempstead) | Gibson-Watt, David | Macmillan, Maurice (Farnham) |
| Awdry, Daniel | Giles, Rear-Adm. Morgan | Maddan, Martin |
| Baker, W. H. K. | Gilmour, Sir John (Fife, E.) | Maginnis, John E. |
| Batsford, Brian | Glover, Sir Douglas | Marten, Neil |
| Beamish, Col. Sir Tufton | Godber, Rt. Hn. J. B. | Maude, Angus |
| Bennett, Sir Frederic (Torquay) | Goodhart, Philip | Mawby, Ray |
| Bessell, Peter | Gower, Raymond | Maxwell-Hyslop, R. J. |
| Biffen, John | Grant, Anthony | Maydon, Lt.-Cmdr. S. L. C. |
| Birch, Rt. Hn. Nigel | Gresham Cooke, R. | Mills, Peter (Torrington) |
| Black, Sir Cyril | Griffiths, Eldon (Bury St. Edmunds) | Miscampbell, Norman |
| Body, Richard | Grimond, Rt. Hn. J. | Mitchell, David (Basingstoke) |
| Bossom, Sir Clive | Gurden, Harold | Monro, Hector |
| Boyd-Carpenter, Rt. Hn. John | Hall-Davis, A. G. F. | More, Jasper |
| Boyle, Rt. Hn. Sir Edward | Hamilton, Michael (Salisbury) | Morgan, W. G. (Denbigh) |
| Braine, Bernard | Harris, Reader (Heston) | Morrison, Charles (Devizes) |
| Brinton, Sir Tatton | Harrison, Brian (Maldon) | Mott-Radclyffe, Sir Charles |
| Brown, Sir Edward (Bath) | Harrison, Col. Sir Harwood (Eye) | Murton, Oscar |
| Bruce-Gardyne, J. | Harvey, Sir Arthur Vere | Nabarro, Sir Gerald |
| Buchanan-Smith, Alick (Angus, N&M) | Heald, Rt. Hn. Sir Lionel | Noble, Rt. Hn. Michael |
| Buck, Antony (Colchester) | Heath, Rt. Hn. Edward | Onslow, Cranley |
| Bullus, Sir Eric | Heseltine, Michael | Orr-Ewing, Sir Ian |
| Campbell, Gordon | Higgins, Terence L. | Osborn, John (Hallam) |
| Carlisle, Mark | Hiley, Joseph | Osborne, Sir Cyril (Louth) |
| Carr, Rt. Hn. Robert | Hill, J. E. B. | Page, John (Harrow, W.) |
| Cary, Sir Robert | Hobson, Rt. Hn. Sir John | Pearson, Sir Frank (Clitheroe) |
| Chichester-Clark, R. | Holland, Philip | Peel, John |
| Clark, Henry | Hordern, Peter | Percival, Ian |
| Clegg, Walter | Howell, David (Guildford) | Pike, Miss Mervyn |
| Cooper-Key, Sir Neill | Hunt, John | Pink, R. Bonner |
| Cordle, John | Hutchison, Michael Clark | Pounder, Rafton |
| Corfield, F. V. | Irvine, Bryant Codman (Rye) | Powell, Rt. Hn. J. Enoch |
| Costain, A. P. | Jenkin, Patrick (Woodford) | Price, David (Eastleigh) |
| Craddock, Sir Beresford (Spelthorne) | Jones, Arthur (Northants, S.) | Quennell, Miss J. M. |
| Cunningham, Sir Knox | Jopling, Michael | Ramsden, Rt. Hn. James |
| Currie, G. B. H. | Joseph, Rt. Hn. Sir Keith | Rawlinson, Rt. Hon. Sir Peter |
| Dance, James | Kaberry, Sir Donald | Rees-Davies, W. R. |
| Davidson, James (Aberdeenshire, W.) | Kershaw, Anthony | Renton, Rt. Hn. Sir David |
| d'Avigdor-Goldsmid, Sir Henry | Kimball, Marcus | Ridley, Hn. Nicholas |
| Dean, Paul (Somerset, N.) | Kirk, Peter | Rossi, Hugh (Hornsey) |
| Deedes, Rt. Hn. w. F. (Ashford) | Knight, Mrs. Jill | Russell, Sir Ronald |
| Dodds-Parker, Douglas | Lambton, Viscount | St. John-stevas, Norman |
| Doughty, Charles | Lancaster, Col. C. G. | Scott, Nicholas |
| Douglas-Home, Rt. Hn. Sir Alec | Langford-Holt, Sir John | Sharples, Richard |
| Eden, Sir John | Lewis, Kenneth (Rutland) | Shaw, Michael (Sc'b'gh & Whitby) |
| Elliott, R. W. (N'c'tle-upon-Tyne, N.) | Lloyd, Ian (P'tsm'th, Langstone) | Sinclair, Sir George |
| Evans, Gwynfor (C'marthen) | Lloyd, Rt. Hn. Selwyn (Wirral) | Stainton, Keith |
| Eyre, Reginald | Longden, Gilbert | Steel, David (Roxburgh) |
| Farr, John | Loveys, W. H. | Stodart, Anthony |
| Fisher, Nigel | Lubbock, Eric | Stoddart-Scott, Col. Sir M. (Ripon) |
| Fletcher-Cooke, Charles | McAdden, Sir Stephen | Summers, Sir Spencer |
| Fortescue, Tim | MacArrhur, Ian | Talbot, John E. |
| Foster, Sir John | Macleod, Rt. Hn. Iain | Tapsell, Peter |
| Taylor, Edward M.(G'gow, Cathcart) | Wainwright, Richard (Colne Valley) | Winstanley, Dr. M. P. |
| Taylor, Frank (Most Side) | Walker, Peter (Worcester) | Wolrige-Gordon, Patrick |
| Teeling, Sir William | Ward, Dame Irene | Wood, Rt. Hn. Richard |
| Temple, John M. | Weatherill, Bernard | Wylie, N. R. |
| Thatcher, Mrs. Margaret | Webster, David | Younger, Hn. George |
| Turton, Rt. Hn. R. H. | Wells, John (Maidstone) | |
| van Straubenzee, W. R. | Whitelaw, William | TELLERS FOR THE AYES: |
| Vaughan-Morgan, Rt. Hn, Sir John | Wills, Sir Gerald (Bridgwater) | Mr. Pym and Mr. Blaker. |
| Vickers, Dame Joan | Wilson, Geoffrey (Truro) | |
| NOES | ||
| Abse, Leo | Dunnett, Jack | Lestor, Miss Joan |
| Albu, Austen | Dunwoody, Mrs. Gwyneth (Exeter) | Lever, L. M. (Ardwick) |
| Alidritt, Walter | Eadie, Alex | Lewis, Ron (Carlisle) |
| Allen, Scholefield | Edwards, William (Merioneth) | Lomas, Kenneth |
| Anderson, Donald | Ellis, John | Loughlin, Charles |
| Archer, Peter | English, Michael | Luard, Evan |
| Armstrong, Ernest | Ensor, David | Lyon, Alexander W. (York) |
| Ashley, Jack | Faulds, Andrew | Lyons, Edward (Bradford, E.) |
| Atkins, Ronald (Preston, N.) | Fernyhough, E. | McBride, Neil |
| Atkinson, Norman (Tottenham) | Finch, Harold | MacColl, James |
| Bacon, Rt. Hn. Alice | Fitch, Alan (Wigan) | MacDermot, Niall |
| Bagier, Gordon A. T. | Floud, Bernard | Macdonald, A. H. |
| Barnes, Michael | Foley, Maurice | McGuire, Michael |
| Barnett, Joel | Foot, Michael (Ebbw Vale) | McKay, Mrs. Margaret |
| Beaney, Alan | Ford, Ben | Mackenzie, Gregor (Rutherglen) |
| Bence, Cyril | Forrester, John | Mackie, John |
| Benn, Rt. Hn. Anthony Wedgwood | Fowler, Gerry | Maclennan, Robert |
| Bennett, James (G'gow, Bridgeton) | Fraser, John (Norwood) | McMillan, Tom (Glasgow, C.) |
| Bidwell, Sydney | Fraser, Rt. Hn. Tom (Hamilton) | McNamara, J. Kevin |
| Binns, John | Freeson, Reginald | MacPhereon, Malcolm |
| Bishop, E. S. | Gardner, A. J. | Mahon. Peter (Preston, S.) |
| Blackburn, F. | Garrett, W. E. | Mallalieu, J. P. W. (Huddersfield, E.) |
| Blenkinsop, Arthur | Garrow, Alex | Manuel, Archie |
| Boardman, H. | Ginsburg, David | Mapp, Charles |
| Booth, Albert | Gourlay, Harry | Marquand, David |
| Boston, Terence | Gray, Dr. Hugh (Yarmouth) | Marsh, Rt. Hn. Richard |
| Bottomley, Rt. Hn. Arthur | Greenwood, Rt. Hn. Anthony | Mason, Roy |
| Bowden, Rt. Hn. Herbert | Gregory, Arnold | Mayhew, Christopher |
| Boyden, James | Grey, Charles (Durham) | Mellish, Robert |
| Braddock, Mrs. E. M. | Griffiths, David (Rother Valley) | Mendelson, J. J. |
| Bradley, Tom | Griffiths, Rt. Hn. James (Llanelly) | Mill an, Bruce |
| Bray, Dr. Jeremy | Gunter, Rt. Hn. R. J. | Miller, Dr. M. S. |
| Brooks, Edwin | Hamilton, James (Bothwell) | Mitchell, R. C. (S'th'pton, Test) |
| Broughton, Dr. A. D. D. | Hamilton, William (Fife, W.) | Molloy, William |
| Brown, Rt. Hn. George (Belper) | Hamling, William | Morgan, Elystan (Cardiganshire) |
| Brown, Hugh D. (G'gow, Provan) | Hannan, William | Morris, Charles R. (Openshaw) |
| Brown, Bob (N'c'tle-upon-Tyne, W) | Harper, Joseph | Moyle, Roland |
| Brown, R. W. (Shoreditch & F'bury) | Hart, Mrs. Judith | Murray, Albert |
| Buchan, Norman | Haseldine, Norman | Neal, Harold |
| Butler, Herbert (Hackney, C.) | Hattersley, Roy | Norwood, Christopher |
| Butler, Mrs. Joyce (Wood Green) | Hazell, Bert | Oakes, Gordon |
| Callaghan, Rt. Hn. James | Henig, Stanley | Ogden, Eric |
| Cant, R. B. | Herbison, Rt. Hn. Margaret | O'Malley, Brian |
| Carmichael, Neil | Hooley, Frank | Orbach, Maurice |
| Castle, Rt. Hn. Barbara | Horner, John | Orme, Stanley |
| Coe, Denis | Houghton, Rt. Hn. Douglas | Oswald, Thomas |
| Coleman, Donald | Howarth, Harry (Wellingborough) | Page, Derek (King's Lynn) |
| Concannon, J. D. | Howarth, Robert (Bolton, E.) | Pannell, Rt. Hn. Charles |
| Conlan, Bernard | Howie, W. | Park, Trevor |
| Corbet, Mrs. Freda | Hughes, Emrys (Ayrshire, S.) | Parker, John (Dagenham) |
| Cousins, Rt. Hn. Frank | Hughes, Hector (Aberdeen, N.) | Parkyn, Brian (Bedford) |
| Craddock, George (Bradford, S.) | Hughes, Roy (Newport) | Pearson, Arthur (Pontypridd) |
| Crawshaw, Richard | Hunter, Adam | Peart, Rt. Hn. Fred |
| Crosland, Rt. Hn. Anthony | Hynd, John | Pentland, Norman |
| Crossman, Rt. Hn. Richard | Jackson, Peter M. (High Peak) | Perry, Ernest G. (Battersea, S.) |
| Cullen, Mrs. Alice | Janner, Sir Barnett | Perry, George H. (Nottingham, S.) |
| Darling, Rt. Hn. George | Jay, Rt. Hn. Douglas | Price, Christopher (Perry Barr) |
| Davidson, Arthur (Accrington) | Jeger, George (Goole) | Price, Thomas (Wes though ton) |
| Davies, Dr. Ernest (Stretford) | Jeger, Mrs. Lena (H'b'n&St. P'cras, S.) | Price, William (Rugby) |
| Davies, G. Elfed (Rhondda, E.) | Jenkins, Hugh (Putney) | Probert, Arthur |
| Davies, Ednyfed Hudson (Conway) | Jenkins, Rt. Hn. Roy (Stechford) | Pursey, Cmdr. Harry |
| Davies, Harold (Leek) | Johnson, Carol (Lewisham, S.) | Rankin, John |
| Davies, Ifor (Gower) | Jones, Dan (Burnley) | Redhead, Edward |
| Davies, Robert (Cambridge) | Jones, J. Idwal (Wrexham) | Rees, Merlyn |
| Dell, Edmund | Judd, Frank | Rhodes, Geoffrey |
| Dewar, Donald | Kelley, Richard | Richard, Ivor |
| Diamond, Rt. Hn. John | Kenyon, Clifford | Roberts, Albert (Normanton) |
| Dobson, Ray | Kerr, Russell (Feltham) | Roberts, Gwilym (Bedfordshire, S.) |
| Doig, Peter | Lawson, George | Robinson, Rt. Hn. Kenneth (St. P'e'as) |
| Donnelly, Desmond | Leadbitter, Ted | Rodgers, William (Stockton) |
| Driberg, Tom | Ledger, Ron | Roebuck, Roy |
| Dunn, James A. | Lee, John (Reading) | Rose, Paul |
| Ross, Rt. Hn. William | Summerskill, Hn. Dr. Shirley | Willey, Rt. Hn. Frederick |
| Rowland, Christopher (Meriden) | Swain, Thomas | Williams, Alan (Swansea, W.) |
| Rowlands, E. (Cardiff, N.) | Symonds, J. B. | Williams, Alan Lee (Hornchurch) |
| Ryan, John | Taverne, Dick | Williams, Clifford (Abertillery) |
| Sheldon, Robert | Thomas, lorwerth (Rhondda, W.) | Williams, Mrs. Shirley (Hitchin) |
| Shinwell, Rt. Hn. E. | Thornton, Ernest | Williams, W. T. (Warrington) |
| Shore, Peter (Stepney) | Tinn, James | Willie, George (Edinburgh, E.) |
| Short, Rt. Hn. Edward (N'c'tle-u-Tyne) | Tuck, Raphael | Wilson, Rt. Hn. Harold (Huyton) |
| Short, Mrs. Renée (W'hampton, N. E.) | Varley, Eric G. | Wilson, William (Coventry, S.) |
| Silkin, John (Deptford) | Wainwright, Edwin (Dearne Valley) | Winnick, David |
| Silkin, S. C. (Dulwich) | Walker, Harold (Doncaster) | Winterbottom, R. E. |
| Silverman, Sydney (Nelson) | Wallace, George | Wyatt, Woodrow |
| Slater, Joseph | Watkins, David (Consett) | Yates, Victor |
| Small, William | Weitzman, David | |
| Snow, Julian | Whitaker, Ben | TELLERS FOR THE NOES: |
| Spriggs, Leslie | White, Mrs. Elrene | Mr. Ioan L. Evans and |
| Steele, Thomas (Dunbartonshire, W.) | Whittock, William | Mr. Walter Harrison. |
| Stewart, Rt. Hn. Michael | Wigg, Rt. Hn. George |
§ MR. SPEAKER then proceeded to put forthwith the Questions on Amendments to the Bill, moved by a member of the Government, of which notice had been given.