HC Deb 11 August 1966 vol 733 cc1965-96

Lords Amendment: In page 1, line 17, at end insert: (c) for carrying on the business of a hotel or a restaurant.

Mr. Speaker

I call attention to the fact that Privilege is involved in this Amendment.

7.17 p.m.

The President of the Board of Trade (Mr. Douglas Jay)

I beg to move, That this House doth disagree with the Lords in the said Amendment.

The substantive effect of this Amendment would be to make the investment grants introduced by the Bill payable to any restaurant or hotel for the plant and machinery—that is, equipment—installed in it. We had some extensive discussions on this issue during all the stages of the Bill in this House. The Government's view remains that it would not be appropriate to give assistance to the hotel industry in this way. To pay investment grants indiscriminately in respect of all equipment in all hotels, restaurants, public houses and other such institutions would be to make a much too wide and indiscriminate use of public money.

It was very largely because the investment allowances, by a series of court decisions, could be used on such a wide scale for all sorts of equipment for which they were not originally intended that it was decided to introduce this more selective and discriminating system of investment grants. For that basic reason—and also because of the cost involved—we would not think it right to return to the former system.

It can be forcibly argued, and I entirely agree with this argument, that many hotels and other tourist institutions are playing a great part in encouraging tourists to come to this country, and are thereby earning foreign exchange. That is certainly true—indeed, it is for that reason that the present Government have introduced, or continued, a number of schemes by which assistance is given to the hotel industry.

First, we must remember that by this Bill the initial allowance which is applicable to equipment used by hotels or restaurants is raised to 30 per cent. That is a generous level, and it will be open to all hotels all over the country, whether they are in development areas or outside them.

Secondly, hotel buildings which provide employment in development areas—and the development areas have been greatly widened so as to include, for instance, practically the whole of Scotland and Wales—will be eligible to receive the 25 per cent. building grant which applies within development areas. Thirdly, hotels are also eligible for B.O.T.A.X. C. assistance—loans, in particular—on the usual terms and conditions throughout all development areas.

In addition, I have been able to announce since the passage of the Bill through this House that, in view of the overseas earnings which many hotels help to bring to this country, the Government are introducing a further and new scheme for development loans from public money to a total of £5 million. It will be available for any development scheme for a hotel where it can be shown that there are real and good prospects of earnings from overseas tourists. We are basing our policy on a more selective approach, and we shall make this money available where it is clear that overseas earnings are in prospect. In addition to all that, I would remind the House that the Government are, in any case, paying a grant of £2 million a year to the British Travel Association, whose job is to encourage and assist the British tourist industry.

All these forms of assistance together are a major contribution to this industry and the recognition by the Government of the value of its services, but we must remember that, of the total earnings of the British hotel and catering industry, rather less than 10 per cent. accrues in the form of foreign exchange. That is a very much lower percentage than the nearer to 25 per cent. earned in exports by manufacturing industry. In my view, that real distinction justifies the basic principle of the Bill that the investment grants should be concentrated on plant and equipment used in manufacturing industry, and also justifies the very considerable help and assistance to the industry which the Government propose to give in the way I have described.

For all those reasons, it seems to us right to confine the investment grant broadly to manufacturing industry in the way provided in the Bill and to give our help selectively to the hotel industry in the other ways I have described. I therefore ask the House to disagree with this Amendment.

Mr. F. V. Corfield (Gloucestershire, South)

The President of the Board of Trade will not be surprised that his attitude to this Amendment comes as a great disappointment to my right hon. and hon. Friends. He has based his case on his view it is not appropriate to assist hotels in this way. He has once again drawn attention to the fact that court decisions had resulted in investment allowances being paid for a much wider range of equipment throughout the whole industry—including the manufacturing and extractive industries, and so on—than might have seemed to be in accordance with the original intentions. He said that that was the basis of the policy of changing over to these grants.

From there on he seemed wholly illogical in saying that, therefore, this was not an appropriate method to apply to hotels, because the discretion that resides in the President of the Board of Trade and the selectivity that can be used, answer the problem of preventing grant being payable in respect of certain types of equipment which, in the past, attracted investment allowance and have, at times, been the subject of a considerable amount of criticism. He argued that he has produced a system ideally suited for selectivity in grants of Government assistance which the hotel industry requires.

He went on to indicate the other types of assistance that were available to the hotel industry—the increased initial allowance, and the 25 per cent. building allowance in the development areas. One of the big needs of the development areas—and here one thinks immediately of the Highlands, the South-West, and so on—is every bit as much for modernisation of existing hotels as for the building of new ones, but, in most cases, when one modernises an hotel one does not increase employment—indeed, by putting in modern facilities and equipment one may actually be reducing the employment available. That, together with the £5 million maximum loan at a favourable rate, contrasted with something like £20 million extra burden in the form of the S.E.T. and the loss amounting to many times that amount as a result of the withdrawal of the investment allowances, cannot be regarded in any sense as more than a drop in the bucket by way of recompense.

We come back to the ludicrous nature of the distinction that the Government have drawn for the purposes of this legislation and the S.E.T. between manufacturing industries and others. That was well brought home this afternoon by the Prime Minister who, in reply to a Question, said that all hotels do not contribute to earnings of foreign exchange. That is very true, but all manufacturers do not contribute to exports. Many manufacturers produce articles whose utility is not always immediately obvious.

It was the Prime Minister himself who referred to "candyfloss" as epitomising the frivolous and the futile, yet those who make candyfloss—I am not quite certain what it is, but I believe it is not a very useful or permanent substance—will under this Bill qualify for a grant for the machinery for making it. Here we have the height of absurdity in drawing such a distinction. The President of the Board of Trade has wholly failed to make out a case for the rejection of this Lords Amendment, and I hope that my right hon. and hon. Friends will vote against his Motion.

7.30 p.m.

Mr. A. G. F. Hall-Davis (Morecambe and Lonsdale)

I think it right at the start to declare an interest in this matter. I am a director of companies owning and operating hotels and restaurants, a fact which by now will be known to the right hon. Gentlemen opposite.

The other place has given us an opportunity to debate this Amendment with the benefit of up-to-date knowledge of decisions which are being taken by the hotel industry in the light of the Government's declared policy. These are decisions which should be taken into account by this House when deciding whether to accept or to reject this Amendment. I had intended to restrict my speech to what I considered to be the most vital points, but the President of the Board of Trade has again repeated one canard which I cannot allow to go without comment.

He referred to the fact that only 10 per cent. of the turnover of the hotel and catering industry was drawn from overseas visitors. I point out that in this year so far as the figures available to date indicate, when Commonwealth visitors are included the estimate of increased spending by overseas visitors on fares and in this country will be approximately £35 million and the total benefit to our balance of payments from spending by overseas visitors in 1966 will amount to £350 million.

Mr. Jay

I gather that that is inclusive of what is spent on fares and not just in hotels and restaurants?

Mr. Hall-Davis

That is quite true and I think the right hon. Gentleman will agree that the proportion is roughly three-to-two of spending in this country and on fares generally, but fares spent with British carriers benefit our balance of payments. In the light of these figures the Government only make themselves ridiculous when they go on repeating the statement about only 10 per cent. of the hotels and catering trade turnover being concerned with overseas visitors. This was said by their spokesman in another place and it has been reiterated by the President of the Board of Trade this evening. It is absolute figures and the rate of growth which should be looked at in assessing the industry's contribution to balance of payments.

According to the Government spokesman in another place, investment expenditure by the hotel and catering industry on plant and equipment in 1964 was of the order of £16 million. I calculate that the cost of the new investment grant, if it were applied to this expenditure and allowing for some increase in the level of costs since 1964 and the higher rate in development areas would have been of the order of £4 million a year. When this £4 million is set against the £35 million increase in overseas earnings in a single year and the total spending by overseas visitors, including that spent with British carriers, is it any wonder that the hotel and catering industry feels that it has been harshly and foolishly treated by the Government?

This is one aspect of the background to our discussion of this Amendment. I turn to another aspect of the background, one which again was referred to by the right hon. Gentleman. That is the Government's promised scheme of assistance to the hotel industry by means of loans. I hope that the House will bear with me while I make a few brief comments on this scheme in the hope that they will be helpful in due course to the Government and to the industry. The Government's proposals to help the industry by means of loans shows every sign of hasty preparation and considerable lack of understanding of the circumstances and needs of the hotel industry.

Basically, the proposals are on too small a scale to encourage the construction of large hotels. The qualifying figure is set too high to be of assistance to small hotels in addition to which the scheme is full of defects of detail. It is certainly no substitute for the benefits which the Amendments we are discussing would bring to the industry. I shall enlarge the criticism that the proposals are on too small a scale. I have seen estimates by those well qualified to make them that to cater for 4 million overseas visitors in 1970 compared with this year's 3 million an extra 10,000 hotel bedrooms will be required. Assuming that 7,500 are provided in new hotels at an average cost of £7,000 and 2,500 in extensions to existing hotels at a cost of £3,000 the total expenditure required is £60 million.

It is against this scale of required investment that we must view the right hon. Gentleman's proposals to advance £5 million for a trial period of one year. Hotel planning is a long-term process involving years of preparation. Unless the President of the Board of Trade can assure the industry that any scheme of assistance will be maintained at least for five years it will be of little value. The right hon. Gentleman's scheme has many other unsatisfactory features. To set a minimum level of loan of £10,000 combined with a maximum rate of 50 per cent. of the cost will make it impossible to qualify for a loan in respect of almost every project costing under £25,000. I remind the right hon. Gentleman that in the case of almost every project of this kind the cost of furniture, furnishings and other items and equipment amounts to 25 per cent. of the cost of the structural work. So even where loans are made at the maximum rate they would meet 40 per cent., not 50 per cent. of the total cost.

There are a great many small hotels in areas visited by tourists which could not contemplate and indeed could not justify expenditure of £25,000 so the scheme will not help them at all. Then there is the question of repayment. If it is the intention of the Government that there should be an annual repayment inclusive of principal and interest then a borrowing at 6 per cent. repayable over 15 years would require an annual repayment of principal and interest of approximately 10.3 per cent. with a net cost in the first year of 7.9 per cent. reaching virtually 10 per cent. in the last year.

Few hotel undertakings could rely on new projects generating in their early years a sufficient cash flow to provide for such repayments and at the same time to service the other capital invested in the project. In considering the relative advantages of the Government's proposals with those in the Amendment there is the question of security for the loan to be considered. If security is needed and it is to take the form of a first charge on the property I am certain that many reputable companies will be unable to start projects if they have to give the Government a first charge.

I trust that these are points which the right hon. Gentleman will consider as indicating the weaknesses of his proposals and that he will discuss them with the "Little Neddy" for the industry at an early date.

So far I have been engaged in the field of argument, opinion and conjecture. I now turn to the concrete evidence we have available of the effect which Government policy is having upon the provision of new hotel accommodation. The wisdom of our decision on this Amendment will be judged by whether the construction, extension and improvement of hotel accommodation continues or is checked. All the evidence is pointing in one direction and the Government surely cannot disregard it.

The annual statement of the Chairman of Scottish and Newcastle Breweries Ltd. appeared in the Press yesterday. At the end of a long section dealing with the effect of the Government's policy on the hotel and tourist industry—a section which I commend to the President of the Board of Trade—Sir William McEwan Younger stated: In particular, so long as these conditions prevail, we will only in quite exceptional circumstances embark on new construction or costly modernisation of major hotels. Another of the country's largest hotel groups—I shall give the right hon. Gentleman the name afterwards if he wishes—had in hand a programme of investment in expansion and improvement of hotel accommodation involving an outlay of £2 million a year. It has now decided to call a halt for the time being to the sanctioning of all new projects under its development programme. This is what is actually happening and has a direct bearing on the Amendment.

I want finally to quote some words of Sir Geoffrey Crowther, Chairman of Trust Houses, which appeared in the Daily Mail on 29th July: I do not believe that the Government has taken a deliberate dead set against hotels. It simply did not realise what it was doing to an industry which is one of the country's chief earners of foreign currency. I share Sir Geoffrey Crowther's views. I am obliged, however, to add the words of the popular song: When will they ever learn, When will they ever learn? If the Government intend to reject the Amendment, I hope that they will make it clear—and this is a plea to the right hon. Gentleman—that they do not regard themselves as irrevocably committed to the proposals announced by the right hon. Gentleman the President of the Board of Trade on 26th July. I am sure that something more beneficial can be worked out between the industry and the Government which embraces grants as well as loans and which worthily recognises the whole industry's valuable contribution to our balance of payments.

Mr. John Hynd (Sheffield, Attercliffe)

I have been listening with some interest to the dissertation of the hon. Member for Morecambe and Lonsdale (Mr. Hall-Davis). As I am not at all informed about the economics of the industry and am rather puzzled, I would like to have some further information from those who are informed about it. The impression which I got as a layman was that there was something curiously wrong with the argument. It might have helped us if the hon. Gentleman had told us what were the fortunes of the hotels in which he was directly interested, so that one could see just how serious the situation was.

Mr. Hall-Davis

I can tell the hon. Gentleman that one of them was erected in what was then a development area, and I can assure him, because it is public knowledge to my shareholders and locally, that it has given a very minimal return on a capital invested. Whoever has had the benefit, it has not been the hotel company.

Mr. Hynd

That is precisely what puzzles me about it, because the hon. Gentleman was talking about the tremendous pressure on hotel accommodation, particularly from tourists to this country. I should have thought that if there was this tremendous demand, the hotel industry would be doing well out of it. I am rather concerned about why it is not.

Normally, when one is asking for Government subsidies for a private concern, it is in order to assist that concern to attract business. In this case, it seems that the business is there, but that the hotel industry is either unable to cater for it, or is only anxious to get public money in order to supplement what it can now make out of the business. We hear much talk from hon. Members opposite about free enterprise and about those who take the risks being entitled to their rewards, and so on, which seems to be rather difficult to fit with their present arguments and constant demands for more and more public subsidies for a purely private enterprise activity.

It is because of that that I ask for further information. I am not making any assertions, but there are many laymen on this subject in the House, and I am sure that I shall be asked in my constituency why it is necessary for an industry, which itself says that it is pressed with more and more business, to have a public subsidy and why it is not capable of absorbing that business and not able to pay its way.

Mr. Corfield

Surely the hon. Gentleman realises that this argument applies to every industry in Sheffield, part of which he represents, which gets grants under the Bill. What we are objecting to is the discrimination between Sheffield manufacturers and hoteliers, both of whom make valuable contributions to the economy, although it would be difficult to distinguish the more valuable.

7.45 p.m.

Mr. Hynd

I agree, but I gather that one of the reasons for investment grants, and so on, for productive industry is to enable that industry to build up its products to satisfy customers, whereas in this case the customers are there and the facilities are not being made available by the industry.

The hon. Gentleman mentioned Sheffield. I do not think that there has been much difficulty about the building of new hotels in Sheffield. Two enormous luxury hotels have been built there during the last two or three years and I have not heard that they are doing too badly. Judging by the prices which they charge, they do not seem to be short of visitors and I do not think that they could show a need for a Government subsidy. I am only asking for more information so that I can satisfy my constituents that public money is being justifiably spent, if the Amendment is accepted.

We were told that certain hotel organisations were holding back from development or cancelling developments, presumably because of the Government's failure to be more forthcoming with public subsidies. Of course, we must try to build up the tourist industry, but if we are to spend a lot of public money on doing so, is there any reason why we should not do as some other countries have done and build and run a series of hotels in tourist areas as public enterprises?

I am sure that many hon. Members will have had the pleasure of visiting Greece, for instance, during the last two or three years, as I have. I have found that the most reliable and the best hotels which I could find at reasonable prices and with very high standards were the Xenia hotels which are Government-built and owned and which do extremely well. It succeeds there, and I do not see why it should not succeed here. Has any thought been given to that aspect of the matter? In short, I am concerned only with justifying, one way or another, the amount of money proposed to be handed out.

Mr. Deputy Speaker (Mr. Sydney Irving)

I gather that the hon. Gentleman is asking for information about State-run hotels. He cannot do so on this Amendment.

Mr. Hynd

I had left that issue and I was saying that I should be glad to hear more detailed information to enable me to make a reasoned judgment one way or another on the justification for expending or withholding public money.

Sir John Eden (Bournemouth, West)

My hon. Friend the Member for Morecambe and Lonsdale (Mr. Hall-Davis) made a powerful case and I suspect that the Government will find it very difficult to resist it. I wonder why the Government should wish to resist it in any event and why they are asking the House to reject the Amendment. I would have thought that they would welcome the opportunity provided by the other place to correct some of the errors of their policy in dealing with the hotel industry. They have been given a welcome opportunity to put right some of the wrongs which they have already done to the industry.

I gather that one aspect of the Government's argument is that it would be invidious to single out one service for special treatment. But the hotel industry has already been singled out for special treatment, unfortunately, for special adverse treatment. It has had imposed upon it the Selective Employment Tax and it has also had removed its assistance, the investment allowance procedure. The Government have already gone some way to recognise that it is an industry meriting special and singular treatment.

Watching over the industry with benign assiduity is the right hon. Gentleman the Minister of State at the Board of Trade, who has under his wing the interests of the industry and the furthering of the tourist trade generally. Now the Government have singled out this industry in another way by the introduction of the new proposals for development loans for major capital expenditure on structural work or fixed equipment, when that will play a significant part in attracting overseas visitors. My hon. Friend the Member for Morecambe and Lonsdale has most graphically pointed out how ineffective these proposals are likely to prove.

I hope that the right hon. Gentleman, when he replies, will give the House some further information as to how this scheme is to be operated, and in what way he thinks that this justifies the refusal of the Government to accept the Amendments which have been proposed by another place. How is it proposed that the hotels, which are to attract overseas visitors shall be earmarked before they are constructed or before the new equipment is installed? I should have thought that it was perfectly clear that unless we have new and modernised hotels throughout the country we are not likely to continue to attract visitors to the extent that we have been doing.

Secondly, I should have thought that there was some relevance in what might be called the negative side of the coin, namely, the desirability of providing adequately for the rising standard of demand of holiday-makers within the country. These are important points which should be dealt with by the Minister. I cannot understand how he will determine what capital expenditure will attract overseas tourists and why, although I accept the balance of payments point, apart from that, he should disregard the aspect of keeping in the country those who would otherwise go abroad.

I hope that the right hon. Gentleman and the Board of Trade Ministers, of all Ministers, will not be too inflexible on these matters. They should not lend themselves to the diktat of the former First Secretary, who laid down a rigid law from which he appeared to be totally unprepared to depart. The right hon. Gentleman and the Board of Trade Ministers are dealing with the realities of our industrial and commercial life and they, above all, must be aware of the need for flexibility and of the need to adjust regulations where it is manifestly in the national interest so to do. This is clearly the case with the hotel and catering industry and I hope that the Government are prepared to reconsider their attitude on the Amendment.

Mr. John H. Osborn (Sheffield, Hallam)

The hon. Gentleman the Member for Sheffield, Attercliffe (Mr. John Hynd) has raised certain points and I would like to say to him from this side of the House that we are not interested in subsidies. The Amendment refers to the payment of grants and refers to Clause 1 of the Bill. The subsidy is something else which has been dealt with by the President of the Board of Trade in another context, outside of this Bill.

Mention has been made of hotels in Sheffield. There is one new hotel in my constituency and another in the centre of the city. Both are Trust House hotels and as my hon. Friend the Member for Morecambe and Lonsdale (Mr. Hall-Davis) has pointed out, certain hotels are not continuing with their programmes. I believe that the Trust house group is one of those which has curtailed its development.

I have been actively concerned, in discussions with the Chamber of Commerce and the Chamber of Trade in Sheffield, with the problem of attracting businessmen to the city. Businessmen will go to London, but they are reluctant to make the journey to Sheffield. I feel that they will be less reluctant now that there are two new hotels in the city in addition to those which already exist. This is accommodation which makes it possible for the heads of businesses to invite their customers to the city. When the customers come to the hotel, they do not stay there; they are able to go out and see the products being made. Invariably, the key export order is one that is clinched either after a reasonable evening meal or the next morning, when the customer has had time to sleep on the arguments put forward.

A country like ours must not only cater for the tourist trade, but for the travelling businessman. These people are travelling around Europe and America and are willing to buy here. If we have good hotels, whether by means of this Clause or other grants, and if these hotels are up to international standard, then export customers will be delighted to come to this country.

Mr. Jay

With the leave of the House, I would like to reply to a number of questions which have been raised. I would like to say, first of all to the hon. Member for Morecambe and Lonsdale (Mr. Hall-Davis), who has great knowledge of this industry, as have other hon. Members who have spoken, that it is not our intention to administer this development loan scheme in any rigid or inflexible manner. We are already discussing the working of it with the British Travel Association and the British Hotels and Restaurants Association, and the "Little Neddy". We shall take into account what hon. Gentlemen have said and, any points which may be raised in these consultations.

I still believe, in spite of all that has been said, and in the light of these consultations, that this will be a considerable contribution to the development of the industry. I rather agree with my hon. Friend the Member for Sheffield, Attercliffe (Mr. John Hynd)—Sheffield appears to be very well represented in the House this evening—that when we are using public money and offering loans of this kind, directed to one particular industry, although there is a good case for doing so, we have to set some limits and have considerable safeguards to see that the loan of public money is justified and is properly used.

After all, we are making available sums of up to £5 million in one year for the benefit of a particular industry. If firms in this industry do not feel that it is any use to them, they are under no obligation to accept it. Money will only be loaned to people who think that they can make some good use of it. If we are to be told that even this amount of assistance will not enable the British hotel industry to develop and modernise, there will be some people, like my hon. Friend the Member for Attercliffe, who will begin to say that perhaps this industry ought to be organised in some other way.

I hasten to add that I am not proposing this, because I believe that the industry, as at present organised, and with all the help given by the Government, is perfectly capable of increasing its earnings and developing in the way in which we all wish.

8.0 p.m.

Mr. Hall-Davis

Two factors are involved. One is the amount of money. The other is the time in which it is available. This is a particularly inappropriate industry to have too narrow a time band in which advantage can be taken of the offer.

Mr. Jay

I take that point. This is an experimental scheme. We have not limited it to one year. We have said that it will certainly be available up to the end of one year. If the hon. Gentleman wishes to extend it beyond that, that is a tribute to the scheme; it shows that it is of some value to the industry.

Some fairly large figures have been used in the debate as estimates of the finance which the industry has lost as a result of the change-over from the investment allowance. Figures even as high as £20 million have appeared in the Press. We are dealing this afternoon with much smaller sums. According to my information, with a 40 per cent. Corporation Tax and with the loss of the 30 per cent. investment allowance, the figures work out in this way, on the basis of the actual capital expenditure which was carried out by the industry in 1964. The amount forgone in the loss of investment allowance in a year would be £2½ million and as much as £1½ million of this would be recouped by reason of

the increase in initial allowances. Therefore, on this test alone only £1 million is at stake.

That has to be compared with the very large figures which the hon. Gentleman gave of about £350 million as the total earnings from tourists and a quite considerable sum, though less than that, as the total turnover of the hotel and restaurant industry. As compared with the £1 million, we are offering up to £5 million in development loans to the industry.

Those figures put the matter in rather better perspective. When it is viewed like that and when account is taken of the points I made earlier as to what the Government are doing in four or five different ways to assist hotels, it is reasonable to think that the industry has every chance of developing its earnings with this help, and it would be inappropriate to go still further and add the investment grant.

Question put, That the House doth disagree with the Lords in the said Amendment:—

The House divided: Ayes 109, Noes 80.

Division No. 172.] AYES [8.2 p.m.
Allen, Scholefield Gray, Dr. Hugh (Yarmouth) Molloy, William
Anderson, Donald Gregory, Arnold Moyle, Roland
Archer, Peter Griffiths, David (Rother Valley) Murray, Albert
Armstrong, Ernest Hamling, William Newens, Stan
Atkins, Ronald (Preston, N.) Hannan, William O'Malley, Brian
Atkinson, Norman (Tottenham) Harrison, Walter (Wakefield) Orme, Stanley
Bacon, Rt. Hn. Alice Haseldine, Norman Owen, Dr. David (Plymouth, S'tn)
Beaney, Alan Hazell, Bert Owen, Will (Morpeth)
Bishop, E. S. Heffer, Eric S. Page, Derek (King's Lynn)
Blackburn, F. Horner, John Price, William (Rugby)
Booth, Albert Houghton, Rt. Hn. Douglas Redhead, Edward
Braddock, Mrs. E M, Howarth, Harry (Wellingborough) Rhodes, Geoffrey
Brooks, Edwin Hughes, Hector (Aberdeen, N.) Richard, Ivor
Brown, R. W. (Shoreditch & F'bury) Hynd, John Roebuck, Roy
Coleman, Donald Jackson, Colin (B'h'se & Spenb'gh) Ross, Rt. Hn. William
Concannon, J. D. Janner, Sir Barnett Shore, Peter (Stepney)
Crawshaw, Richard Jay, Rt. Hn. Douglas Short, Mrs. Renée (W'hampton, N. E.)
Crossman, Rt. Hn. Richard Jenkins, Hugh (Putney) Silkin, Rt. Hn. John (Deptford)
Darling, Rt. Hn. George Jones, Dan (Burnley) Silkln, S. C. (Dulwich)
Davidson, Arthur (Accrington) Jones, Rt. Hn. Sir Elwyn (W. Ham, S.) Silverman, Julius (Aston)
Davies, Robert (Cambridge) Judd, Frank Slater, Joseph
Dickens, James Kenyon, Clifford Small, William
Dobson, Ray Kerr, Russell (Feltham) Snow, Julian
Dunwoody, Mrs. Gwyneth (Exeter) Lawson, George Spriggs, Leslie
Dunwoody, Dr. John (F'th & C'b'e) Lee, John (Reading) Steele, Thomas (Dunbartonshire, W.)
Edwards, Robert (Bilston) Lyons, Edward (Bradford, E.) Tinn, James
Ellis, John McBride, Neil Urwin, T. W.
Ensor, David MacDermot, Niall Wainwright, Edwin (Dearne Valley)
Faulds, Andrew Macdonald, A. H. Walker, Harold (Doncaster)
Fitch, Alan (Wigan) McKay, Mrs. Margaret Watkins, David (Consett)
Fletcher, Raymond (Ilkeston) McMillan, Tom (Glasgow, C.) Whitaker, Ben
Floud, Bernard McNamara, J. Kevin Whitlock, William
Foot, Michael (Ebbw Vale) MacPherson, Malcolm Willis, George (Edinburgh, E.)
Forrester, John Marquand, David Winnick, David
Fowler, Gerry
Fraser, John (Norwood) Mikardo, Ian
Freeson, Reginald Millan, Bruce TELLERS FOR THE AYES:
Garrett, W. E. Mitchell, R. C. (S'th'pton, Test) Mr. Harper and
Mr. Ioan L. Evans
NOES
Alison, Michael (Barkston Ash) Goodhart, Philip Page, Graham (Crosby)
Allason, James (Hemel Hempstead) Goodhew, Victor Pardoe, John
Barber, Rt. Hn. Anthony Gurden, Harold Peel, John
Batsford, Brian Hall-Davis, A. G. F. Percival, Ian
Bessell, Peter Hawkins, Paul Price, David (Eastleigh)
Biffen, John Heald, Rt. Hn. Sir Lionel Prior, J. M. L.
Body, Richard Heseltine, Michael Pym, Francis
Boyd-Carpenter, Rt. Hn. John Holland, Philip Renton, Rt. Hn. Sir David
Bruce-Gardyne, J. Hornby, Richard Russell, Sir Ronald
Bullus, Sir Eric Howell, David (Guildford) Scott, Nicholas
Clegg, Walter Hunt, John Sharples, Richard
Corfield, F. V. King, Evelyn (Dorset, S.) Steel, David (Roxburgh)
Costain, A. P. Kirk, Peter Teeling, Sir William
Craddock, Sir Beresford (Spelthorne) Legge-Bourke, Sir Harry Thorpe, Jeremy
Crouch, David Lewis, Kenneth (Rutland) Vaughan-Morgan, Rt. Hn. Sir John
Cunningham, Sir Knox Lloyd, Ian (P'tsm'th, Langstone) Weatherill, Bernard
Davidson, James (Aberdeenshire, W.) Longden, Gilbert Webster, David
Dean, Paul (Somerset, N.) Loveys, W. H. Wells, John (Maidstone)
Doughty, Charles Lubbock, Eric Whitelaw, William
Eden, Sir John Maxwell-Hyslop, R. J. Wills, Sir Gerald (Bridgwater)
Elliott, R. W.(N'c'tle-upon-Tyne, N.) Maydon, Lt.-Cmdr. S. L. C. Wilson, Geoffrey (Truro)
Errington, Sir Eric Mitchell, David (Basingstoke) Wolrige-Gordon, Patrick
Eyre, Reginald More, Jasper Woreley, Marcus
Fortescue, Tim Morgan, W. G. (Denbigh) Younger, Hn. George
Foster, Sir John Noble, Rt. Hn. Michael
Giles, Rear-Adm. Morgan Nott, John TELLERS FOR THE NOES:
Glover, Sir Douglas Orr-Ewing, Sir Ian Mr. Blaker and
Glyn, Sir Richard Osborn, John (Hallam) Mr. Grant.

Lords Amendment: In page 2, line 10, at end insert: (f) the extraction of timber and works ancillary thereto.

Mr. Deputy Speaker

I call the attention of the House to the fact that Privilege is involved in this Amendment.

The Minister of State, Board of Trade (Mr. George Darling)

I beg to move, That this House doth disagree with the Lords in the said Amendment.

The effect of the Amendment would be to make the extraction of timber and works that are ancillary to the extraction of timber a qualifying industrial process for plant and machinery grants. We ask the House to reject the Amendment for three main reasons: first, it is outside the scope and intentions of the Bill; secondly, the forestry industry does not fall within the category of industries that require the highest priority for Government assistance in the present economic circumstances; and, thirdly, there is already an adequate system of Government financial assistance to forestry.

I remind the House that the scope of the Bill is, broadly, to provide investment incentives for industry in the sense of manufacture and production and for construction and mining. The Bill is not designed to provide incentives for agriculture, horticulture or forestry.

As the White Paper on Investment Incentives stated, there are separate arrangements for agriculture as a key sector of economic activity. Provision for investment grants for agriculture and horticulture is made in the Agriculture Bill. The arrangements for agriculture are different in a number of important respects from those contained in the Bill.

I agree that the Amendment relates to the extraction of timber rather than the cultivation of our forests and that forestry is not covered by the other arrangments to which I have referred, and that what I have described as the mining processes of the Bill cover the extraction of peat and brine—in case hon. Members wish to raise this argument—which are not minerals. I am sure that it will be agreed by hon. Members that the extraction of these minerals is essentially similar to the mining of minerals. On the other hand, the extraction of timber is more akin to the harvesting of a crop although, in this case, a very long-term crop.

I do not deny that forestry makes an important contribution to import saving. We import approximately 90 per cent. of our requirements in timber and timber products and spend large sums abroad each year on imported timber, timber products and paper. But the application of investment incentives for forestry equipment, which is what we are discussing here, whether for cultivating or for tree felling, would not, in our view, have any immediate effect upon the balance of payments.

8.15 p.m.

To take, first, the planting of trees, many years pass before trees which have been planted can make any contribution to the economy, and the rate at which timber can be extracted depends upon the planting of forests. Moreover, most private foresters and timber merchants operate on a modest scale and do not buy enough plant and machinery to attract sizeable investment grants. For the industry as a whole, the amount at stake is not very large.

We therefore take the considered view that the needs of forestry should be looked at as a whole, rather than that we should take this one narrow section, and that these needs should not be dragged in at this very late stage to a scheme which is designed for manufacturing industry. As I have said, there is already a system for giving Government assistance to forestry.

We have considered carefully whether the present system of assistance to forestry is adequate, or whether it needs supplementing by something comparable to the special schemes under the Agriculture Bill which will provide the new investment incentives for agriculture. The Government have concluded that this would not be justified at the present time. However, there is provision for regular review of the assistance to forestry and I assure hon. Members that the Departments responsible will certainly watch the situation carefully as it develops and consider whether any improvements are called for at any time.

I again stress, however, that in our view the assistance to forestry as asked for in the Amendment is outside the scope of the Bill. It is much better to help forestry in the ways I have suggested. I must, therefore, ask the House to disagree with the Lords' Amendment.

Mr. Michael Noble (Argyll)

Most hon. Members would have expected the Minister of State to refuse to help in this way, and might have anticipated at least some of his arguments, had they had the misfortune to read the Official Report of the proceedings of the other place. To my mind, however, it is rather tragic that at a moment like this the Minister can come to the House and say that he has decided to give no help to an industry because, in his view, it is not sufficiently important and that the economic state of the country is such that no help should be given.

This highlights once again the Government's determination to try to scramble through, if, perhaps, only for the length of the Recess, without ever looking at the problems which are bound to face this industry and many other industries where there is a long-term serious problem and to say that they will look at them again in a year's time or yearly and see whether anything needs to be done.

The tragedy—and it is, in a way, a tragedy, and Government for many years have been involved in it—is that we have neglected forestry to a quite appalling extent. I do not think, as the Minister of State thinks, that the Forestry Commission are the people who should be doing all the planting. I do not regret any curtailment in that sphere if we can get the people who look after the land to use trees as a sensible crop and one that should be grown.

It is anomalous, to put it no higher, that at a time when the balance of payments is one of the critical problems, the Minister can admit that we are importing 90 per cent. of our timber—our import figure is, I think, about £450 million a year—and that this is not important. Of course it is important. If we are to get the situation right, although the growing of trees is a long-term programme, if the Minister would come up to my part of the world and look around he would see many thousands of acres of trees planted in the 1920's and 1930's which, are now ready for cutting and need to be extracted. That being so it is surely right—and the Minister has admitted there is not much money involved—to say now that this sort of help, which is quite small in quantity, should be given to the people who ought to be thinking out new methods of extracting the timber which is ready to be extracted.

I have said before in debates here that probably the biggest mistake the Forestry Commission has made in the 40 years of its existence is that it has never looked beyond its immediate nose—rather as the Minister is trying to do with the economic situation today. When I was young the Commission planted thousands of acres of trees but with no idea at all how it was going to get them out of those areas in which it wanted them. Then after the war this problem hit the Commission rather hard and it proceeded to build enormously expensive roads all through its forests in order to get the timber out. Hon. Members who have been to other parts of Europe and seen the way the timber comes out, in Sweden, in the Alps, for instance, will have seen that there are not these great and very expensive forest roads built all over the place. In those countries they have other, better, much more efficient methods of extraction. Then the Commission had no idea till the paper mill came along, where it should sell the material. This was planning gone mad.

I believe the other place, in putting this Amendment before us, has done a real service in trying to concentrate our minds on more efficient methods of extraction which will make our own industry cheaper and more efficient, and a protection against having to import timber. I believe that we should support the Amendment, and I shall certainly ask my hon. and right hon. Friends to do so.

Mr. Michael Alison (Barkston Ash)

I want to take issue with the Minister of State on the argument that this is really akin to agriculture. It surely cannot be denied that timber, in this sense in which we are talking about it, is not a crop for consumption in that sense. This is the preparation of an industrial material. It is akin to industrial material. It is a material integral to many aspects of industrial manufacture. It is not only a material for the making of things like window frames and furniture, a material which the furniture manufacturers use, but it is deeply related to the extraction of coal.

It is so analogous to coal, and so closely related to coal, that I cannot see how the Minister can possibly excuse not putting this particular industry into the same category as those covered by the Clause, in the same category as searching for or the extraction of coal. If the Minister is talking about the extraction of timber as being akin to a long-term—this was the phrase he used—a long-term crop, he should remember that if he were to carry that further he would discover that timber in the very long term becomes coal, and there is no reason, therefore, why he should not be prepared to give it the same treatment as coal, on that extended time scale.

The point is of some historical significance and interest. I do not know whether the Minister has seen it, but if he has he will recall, in Professor Alan Taylor's "English History, 1914–45", the extremely interesting point which the professor brings out, namely, that the German submarine warfare, in the 1914–18 war, and developed comparatively late, after 1916, had a serious impact, above even the impact on food supplies, upon the supplies of pit props for our coal mining industry, which at that time was unsupported by oil and other mineral resources for the generation of power for British industry.

Pit props were essential to the mining industry and a large percentage came from Scandinavia, and supplies were almost entirely cut off by the success of the German submarine warfare. It was that which led to the setting up of the Forestry Commission, for the specific purpose of growing pine and other similar trees so that pit props could be supplied from British forests and we would not be subject to this sort of possible strangulation if war came a second time.

I hope that the Minister appreciates that pit props are an integral part of industrial processes. Plant and machinery required for the preparation of pit props in the forests should qualify in the forests in which the trees are felled, lopped, and turned into pit props on the spot. We want to make quite certain that he will at least agree that the preparation of pit props qualifies under the Bill. It would be much more suitable if he allowed the machinery used for the preparation of this essential industrial material to qualify, whether machinery used in forestry or for getting the material away from forests to factories, and if he were to make quite certain that the extraction of a natural feature, which is integral to the manufacturing process in factories and mines, is included in the provisions of the Bill.

Mr. James Davidson (Aberdeenshire, West)

Some of the points I wish to make have been dealt with already, and I shall try to keep my remarks brief. First, comparisons have this evening already been made with agriculture, though perhaps not with fishing, but in fact these are three industries which are normally grouped together, agriculture, forestry and fishing. Agriculture is eligible for machinery and plant—and will be eligible under the Agriculture Bill; the fishing industry is already eligible for grants given by the White Fish Authority; but, for some reason which I find very hard to understand, the forestry industry is being excluded.

The point is being made by the Government that the forestry industry is eligible for certain grants, but they are grants for planting, not for machinery or for extraction. Those grants will not, on the whole, go to people who do the extracting. Extracting is more usually done by independent contractors, and for this reason this industry is regarded as a separate part of what is the same industry.

It has been said that the amount involved is perhaps not very large. I should like to make the point that to those involved as contractors in the extracting industry the amount may be very large indeed, and to the small contractor it is a very large amount of money.

I should like to mention the aspect of employment. It has been said that this is outside the scope and function of the Bill, but surely part of the scope and function of the Bill is to try to stimulate employment in the development areas, and this is surely important. Timber extraction and forestry in general form a highly important industry in many development areas, and particularly in the north and north-east of Scotland. It would be an encouragement if help to them with their equipment were allowed under this Bill.

It would be an encouragement to private forestry. I should like to stress at this point that by private forestry I mean the planting of trees in the right place, not the wrong place, and, in passing I would say that some of us would be delighted to see rural development boards set up in due course, guaranteeing the interests of agriculture and forestry.

I know very well that in my own part of Scotland there is a very great shortage of land for planting timber, and I believe that this small Amendment would in fact assist in this way. One of the reasons why the Forestry Commission cannot get land is that it will not pay sufficiently high prices for it. If there were these grants available for extracting machinery, that would reduce the costs of extraction, reduce the costs of timber production, and, therefore, would enable the Forestry Commission to offer slightly higher prices for land and thus make it more readily available for planting.

Mr. A. H. Macdonald (Chislehurst)

I am trying to following the hon. Member's argument, but he was speaking of people planting timber and saying that they were not the same people who take it out. In this case how can this Amendment assist them?

Mr. Davidson

It is one continuous operation—is it not?—planting, growing, and extracting timber. Therefore, the final end product and its price is closely related to the original price of the land purchased for planting. It is the same with agriculture and it is a reasonable argument. The point has been made that 90 per cent. of our timber is imported, but I make it slightly more according to figures I have studied. I believe that the value is nearer £700 million than the £400 million mentioned by the right hon. Gentleman.

Forestry is in every sense closely related to manufacturing industry and is therefore completely within the scope of the Bill. The point about pit props and the connection with coal has already been made and coal is specifically mentioned in the Bill. There is also a reference to furniture and the making of any article;". No one can possibly dispute that paper-making is a manufacturing industry. Timber is important to building and the Bill specifically mentions the construction industry. I have looked at the Bill very carefully, for it is an interesting Measure, and I cannot possibly understand why forestry has been excluded.

8.30 p.m.

Mr. Marcus Worsley (Chelsea)

I do not think that many of us on this side of the House were very optimistic, when we saw this Amendment, that the Government were likely to accept it. But I must say, with respect to the Minister of State, that I do not think that the words he used were those which would most encourage the private forestry industry. Perhaps in this context I should declare an interest, for I am a timber grower.

The right hon. Gentleman said that this was not an industry that demanded the highest priority of attention from the Government. I think that he has used most ill-chosen words and I invite him to make it clear that it is part of Government policy to support the forestry industry. I hope that he will. What the Government do not always appreciate is the importance of confidence to an industry. A moment ago we had a debate on the hotel industry. What happened to that industry was a crisis of confidence in the Government's intention to support it. This resulted from an accumulation of different measures.

There is a risk of something very similar happening in the timber industry. I am sure that the House will realise that the decision to plant a wood is immensely long term. There is no other industry where confidence matters more, for the simple reason that there is no prospect of a quick return from the planting of a tree. There is no other industry to which support over a long period is more important. It is most important for the Government therefore to measure their words in speaking about this industry. I hope that the right hon. Gentleman will show that the Government are behind it.

Secondly, I believe that the Minister is wrong not only in the way he set it out but in what he said—that it is not an important industry at this moment in the context of the balance of payments. I shall not repeat the figures about imports and exports but will merely underline what has been said in terms of the balance of payments.

The Amendment is concerned with increased efficiency of the industry. We have a series of grants, the most important of which is a grant for the planting of new forests. In other words, the emphasis on grants under the present system is entirely on the capital installation of new forests. What is needed in the emphasis in future is held towards the efficient extraction of existing forests. Assistance in this direction would be a direct and immediate assistance to the balance of payments.

The existing grants are building up wealth for the future and that is fine, but the Amendment would assist extraction at the moment and enable timber to be got out more efficiently and therefore more cheaply. It would be of direct help to the balance of payments. Not only has the right hon. Gentleman put this point in a discouraging way but the point itself is wrong.

In his concluding remarks, the right hon. Gentleman said something about the Government keeping this matter under review. I invite him to say whether that is just a form of words or whether he really means it and that it is indeed the Government's intention to look at the situation of the industry. This is not a party point. I can be as rude as he would like about the record of Conservative Governments in looking at this problem in a clear and coherent way. I ask for an undertaking, if we are not to have this Amendment, that the words of the right hon. Gentleman are not just a mere form but are seriously meant so that the part the industry can play in our balance of payments situation will be looked into in future.

Mr. Paul Hawkins (Norfolk, Southwest)

I have been interested in forestry all my life and had a part in the most expensive extracting machinery during the war in getting timber out of German woods with a pick and shovel when I was a prisoner because we were allowed to extract only the roots of the trees and the stumps. I assure the right hon. Gentleman that that was a very expensive way and very hard work and that machinery is badly needed in our woodlands for extraction purposes.

There is a large area of forestry in my constituency, Thetford Chase, probably one of our largest forests. It stretches from my constituency through South Norfolk. These woods were planted 30 or 40 years ago and now a very large programme of extraction is coming along. More and more machinery is needed for the area.

As my hon. Friends have said, the industry has had little to thank any Government for over the past years. It needs a dose of confidence now if it is to go on with the cycle, so necessary in forestry, of planting and felling, which is such an enormously long-term business.

If one puts a stop on any particular part of that cycle—which could happen if it were shown that the Government were not sympathetic to forestry—it has a bad effect upon the whole of this big industry, which could save a tremendous amount in imports. We still have large areas of land in this country which could well have been afforested and I believe that we could save an immense amount of money in growing our own timber.

I, too, was disturbed by the words of the Minister of State in referring to agriculture and forestry as being rather second-rate to industry in the towns. He appeared to put manufacturing industry far above agriculture and forestry. Indeed, if he does not do anything else he should try and dispel that impression and I hope that he will.

Mr. Darling

With the leave of the House, I should like to reply briefly to the criticisms of my observations and also to the case that has been put forward for accepting the Lords' Amendment.

I agree entirely with the hon. Member for Norfolk, South-West (Mr. Hawkins) and the right hon. Member for Argyll (Mr. Noble) about the importance of agriculture and forestry. I do not think that I suggested that they were not important to the national economy. They are tremendously important. I was merely saying that after consultations with the other Government Departments concerned we have decided that it is far better to help forestry, in the way suggested in the Amendment, under other legislation than this Bill.

I do not want to spell out the anomalies which would be created if we kept bringing additional industries, trades or processes into the provisions of the Bill when such industries or trades are excluded under the principles laid down in the Bill.

Mr. Noble

Very much the same sort of remark was made in the other place. A noble Lord asked whether the Minister there was saying that the Government intended to bring in legislation to deal with this problem in another Bill, and the answer he received was, "No". If this is the Minister's answer, even if something may happen in three or four years' time he should make it clear that what he has in mind is in the future, and not something that will be included in the Agriculture Bill, or something of that sort.

Mr. Darling

I have read the OFFICIAL REPORT of the debate in the other place. As the right hon. Gentleman said, the question was directed to the contents of the Agriculture Bill, which is at present going through the House. The answer is that it is not intended to satisfy the demand for an extra grant for forestry within the terms of that Bill, but, as I have already said, arrangements exist under present legislation—as the right hon. Gentleman knows far better than I do—for continuous reviews of the needs of forestry, and in the course of these reviews, in the not too far distant future, the Government intend to see whether additional assistance is needed.

I thought that the hon. Member for Chelsea (Mr. Worsley) was going to speak for the timber growers of Chelsea when he began, but he went on to declare his own interest. I am sorry if I did not make myself clear. What I meant was that the national economy derives economic assistance from the timber industry in the long term. We obtain assistance in the long term from timber planting now, but in the short term we derive very little advantage, whereas assistance given to the extraction industry has an immediate benefit for the economy. The only quarrel between us is on the question of what legislation, and in what form assistance should be given.

I was surprised when the hon. Member for Aberdeenshire, West (Mr. James Davidson) pursued the argument that we should give Government grants for the purpose of increasing the price to be paid by the Government to private land owners in order to obtain land for afforestation. This seemed to be a proposition that no Government would be likely to accept.

Mr. James Davidson

I am sorry if I did not make my argument clear. If we reduce the costs of the extraction of timber we increase the profit made by the private growers of that timber and can, therefore, allow a higher price to be offered for the land which is purchased. One reason why the Forestry Commission cannot get land is that it is not offering a high enough price.

Mr. Darling

It comes to the same thing in the end. If the hon. Member has read the OFFICIAL REPORT of our proceedings in Committee he will know that on more than one occasion it was pointed out that the purpose of investment grants is not to increase dividends paid to shareholders or to increase profits but to encourage people to invest more money in the machinery and equipment which is needed to increase the rate of productivity. We can argue these points on another occasion.

8.45 p.m.

I was intrigued by the arguments of the hon. Member for Barkston Ash (Mr. Alison) about pit props. He probably knows that the purpose of the Coal Board's modernisation schemes at the moment is to get rid of things like pit props. I see the argument, but the machinery and the equipment required at the sawmills, because this is a productive, manufacturing process, would, of course, attract investment grants. It ought to be made clear, and the right hon. Member for Argyll skated over this——

Mr. Alison

The right hon. Gentleman appreciates, I am sure, that some of the preparation of pit props is not done in sawmills but in situ, in the forest. We want to be clear that machinery used in the forest in trimming and lopping, which may be interchangeable with the felling of trees, is, nevertheless, eligible.

Mr. Darling

I see the point, but this is also a matter which we have discussed and considered carefully. The conclusion to which we came was that, for the activities which took place in the forest, the proper assistance that the Government gave should come under other legislation than this Bill.

The right hon. Member for Argyll skated over the grants which are given for planting and replanting of trees, the management grants and the dedication schemes, some of which he was responsible for. At least, he had the job of administering them. Of course, the level of grants for planting and replanting is reviewed at least every three years under this legislation. The last review having been made in 1964, all this has to be reviewed next year. This is one of the points which was in our minds when we suggested that, under other legislation, some of the matters raised by hon. Members might receive the favourable consideration for which they are asking, but I can give no undertakings.

Mr. Corfield

Surely we have now reached a situation in which mobile equipment which is moved into the forest to make gates and hurdles is making an article and is covered in the Bill, whereas if the materials are moved down to a much more efficient sawmill so that the process is carried out much more commercially, the equipment is not in the Bill. Is this not absurd?

Mr. Darling

Not at all. We are going back to our earlier arguments. It would be a mistake to begin the Committee stage all over again.

Question put, That the House doth disagree with the Lords in the said Amendment:—

The House divided: Ayes 111, Noes 75.

Division No. 173.] AYES [8.57 p.m.
Allen, Scholefield Dobson, Ray Heffer, Eric S.
Anderson, Donald Dunwoody, Mrs. Gwyneth (Exeter) Horner, John
Archer, Peter Dunwoody, Dr. John (F'th & C'b'e) Houghton, Rt. Hn. Douglas
Armstrong, Ernest Edwards, Robert (Bilston) Howarth, Harry (Wellingborough)
Atkins, Ronald (Preston, N.) Ellis, John Hynd, John
Atkinson, Norman (Tottenham) Ensor, David Jackson, Colin (B'h'se & Spenb'gh)
Bacon, Rt. Hn. Alice Faulds, Andrew Janner, Sir Barnett
Beaney, Alan Fitt, Gerald (Belfast, W.) Jay, Rt. Hn. Douglas
Bonn, Rt. Hn. Anthony Wedgwood Fletcher, Raymond (Ilkeston) Jenkins, Hugh (Putney)
Bishop, E. S. Floud, Bernard Jones, Dan (Burnley)
Blackburn, F. Forrester, John Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)
Booth, Albert Fowler, Gerry Judd, Frank
Bowden, Rt. Hn. Herbert Fraser, John (Norwood) Kenyon, Clifford
Braddock, Mrs. E. M. Freeson, Reginald Kerr, Russell (Feltham)
Brooks, Edwin Garrett, W. E. Lawson, George
Brown, R. W. (Shoreditch & F'bury) Gray, Dr. Hugh (Yarmouth) Lee, John (Reading)
Coleman, Donald Gregory, Arnold Lyons, Edward (Bradford, E.)
Concannon, J. D. Griffiths, David (Rother Valley) McBride, Neil
Crawshaw, Richard Hamling, William MacDermot, Niall
Crossman, Rt. Hn. Richard Hannan, William Macdonald, A. H.
Darling, Rt. Hn. George Harper, Joseph McKay, Mrs. Margaret
Davidson, Arthur (Accrington) Harrison, Walter (Wakefield) McMillan, Tom (Glasgow, C.)
Davies, Robert (Cambridge) Haseldine, Norman McNamara, J. Kevin
Dickens, James Hazell, Bert MacPherson, Malcolm
Marquand, David Richard, Ivor Steele, Thomas (Dunbartonshire, W.)
Mikardo, Ian Rodgers, William (Stockton) Tinn, James
Millar, Bruce Roebuck, Roy Urwin, T. W.
Mitchell, R. C. (S'th'pton, Test) Ross, Rt. Hn. William Wainwright, Edwin (Dearne Valley)
Molloy, William Shore, Peter (Stepney) Walker, Harold (Doncaster)
Moyle, Roland Short, Mrs. Renée (W'hampton, N. E.) Watkins, David (Consett)
Murray, Albert Silkin, Rt. Hn. John (Deptford) Whitaker, Ben
Newens, Stan Silkin, S. C. (Dulwich) Whitlock, William
O'Malley, Brian Silverman, Julius (Aston) Willis, George (Edinburgh, E.)
Orme, Stanley Silverman, Sydney (Nelson) Wilson, Rt. Hn. Harold (Huyton)
Owen, Dr. David (Plymouth, S'tn) Slater, Joseph Winnick, David
Page, Derek (King's Lynn) Small, William
Redhead, Edward Snow, Julian TELLERS FOR THE AYES:
Rhodes, Geoffrey Spriggs, Leslie Mr. Fitch and
Mr. Ioan L. Evans.
NOES
Alison, Michael (Barkston Ash) Goodnew, Victor Osborn, John (Hallam)
Alison, James (Hemel Hempstead) Gurden, Harold Page, Graham (Crosby)
Barber, Rt. Hn. Anthony Hall-Davis, A. G. F. Pardoe, J.
Batsford, Brian Hawkins, Paul Peel, John
Bessell, Peter Heald, Rt. Hn. Sir Lionel Percival, Ian
Biffen, John Heseltine, Michael Price, David (Eastleigh)
Blaker, Peter Holland, Philip Pym, Francis
Body, R. Hornby, Richard Ronton, Rt. Hn. Sir David
Boyd-Carpenter, Rt. Hn. J. Howell, David (Guildford) Russell, Sir Ronald
Bullus, Sir Eric Hunt, John Scott, Nicholas
Clegg, Walter King, Evelyn (Dorset, S.) Sharples, Richard
Corfield, F. V. Kirk, Peter Steel, David (Roxburgh)
Craddock, Sir Beresford (Spelthorne) Legge-Bourke, Sir Harry Thorpe, Jeremy
Crouch, D. L. Lewis, Kenneth (Rutland) Vaughan-Morgan, Rt. Hn. Sir John
Cunningham, Sir Knox Lloyd, Ian (P'tsm'th, Langstone) Weatherill, Bernard
Davidson, James (Aberdeenshire, W.) Longden, Gilbert Webster, David
Dean, Paul (Somerset, N.) Loveys, W. H. Wells, John (Maidstone)
Eden, Sir John Lubbock, Eric Whitelaw, William
Errington, Sir Eric Maxwell-Hyslop, R. J. Wills, Sir Gerald (Bridgwater)
Eyre, Reginald Maydon, Lt.-Cmdr. S. L. C. Wilson, Geoffrey (Truro)
Fortescue, Tim Mitchell, David (Basingstoke) Wolrige-Gordon, Patrick
Foster, Sir John More, Jasper Worsley, Marcus
Giles, Rear-Adm. Morgan Morgan, W. G. (Denbigh) Younger, Hn. George
Glover, Sir Douglas Noble, Rt. Hn. Michael
Glyn, Sir Richard Nott, John TELLERS FOR THE NOES:
Goodhart, Philip Orr-Ewing, Sir Ian Mr. R. W. Elliott and
Mr. Grant.

Committee appointed to draw up Reason to be assigned to the Lords for disagreeing to their Amendments to the Bill: Mr. Barber, Mr. Corfield, Mr. Darling, Mr. Jay and Mr. Dan Jones: Three to be the quorum.—[Mr. Jay.]

To withdraw immediately.

Later—

Reason for disagreeing to the Lords Amendments reported and agreed to; to be communicated to the Lords.