Commons Sitting of 29 April 1968

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
ORAL ANSWERS TO QUESTIONS
  PUBLIC BUILDING AND WORKS

    Building Construction (Home-Produced Materials)
    Sir G. Nabarroasked the Minister of Public Building and Works what further steps he has now taken to induce the use of home-produced materials instead of imported materials for building construction.
    The Minister of Public Building and Works (Mr. Robert Mellish): I have nothing to add at present to the information I have already given in reply to a number of Parliamentary Questions.
    Sir G. Nabarro: Having regard to the fact that sterling devaluation is now six months old and the right hon. Gentleman has been professing the need to restrict and curtail imports of building materials since that date, may I ask whether he can say when his exhortations to professional advisers and others will begin to be effective?
    Mr. Mellish: With my Department I have taken what necessary action is required. The hon. Gentleman is quite right to point out that this concerns professional advisers to the private sector. I can only ask for their help and guidance. They are trying to give that. I think I have their good will, but I have no power to instruct them.

    The Citadel, The Mall (Creepers)
    Mr. Tilneyasked the Minister of Public Building and Works what plans he has to plant creepers that will grow properly on the north face of the Citadel in the Mall.
    Mr. Mellish: At least six attempts have been made to grow various species of creeper on the north side of this building, but so far without success. A further attempt will be made shortly.
    Mr. Tilney: Will the Minister try fan-shaped morello cherries, which grow particularly well without any sunlight and look extremely attractive at this time of year?
    Mr. Mellish: That sounds marvellous; I will try anything. I am told that there have been five attempts. I gather that as this is on the north side, the climate is not favourable to these kind of creepers, although there are one or two others I could think of.
    Mr. Whitaker: What plans has my right hon. Friend for removing the Citadel, which was put up temporarily in wartime?
    Mr. Mellish: I should like notice of that.

    Hyde Park Corner (Wall)
    Mr. Tilneyasked the Minister of Public Building and Works what plans he has to improve the north face of the high wall at Hyde Park Corner.
    Mr. Mellish: None, Sir.
    Mr. Tilney: Does not the Minister regard that high wall at Hyde Park Corner as very ugly in a very important place in the capital of Britain? Could he not take an example from capital cities in Europe, and also from Oxford, to make it much more pleasant?
    Mr. Mellish: I respect the hon. Member's desire to improve any ugliness in our great city. I understand that this is partly the responsibility of Westminster City Council, and I shall have discussions with the council. I am told that the wall is in excellent condition. This is not an easy problem.

    Construction Industry (Exports)
    Mr. Arnold Shawasked the Minister of Public Building and Works whether he is aware of the export opportunities within the construction industry; and what action he is taking to encourage such exports.
    Mr. Moreasked the Minister of Public Building and Works what is his policy regarding ways and means of increasing exports by the construction industry; and if he will make a statement.
    Mr. Mellish: Three construction industry groups are active in the export field—the consultants, the contractors and the materials manufacturers. I have seen each group separately, and recently brought the three together for a discussion on the opportunities for expanding business. I hope to help them to collaborate more closely, particularly in the field of market intelligence.
    Mr. Shaw: Although that Answer will give a great deal of satisfaction, will my right hon. Friend keep the matter under constant review and see that the industry plays its due part?
    Mr. Mellish: I am obliged to my hon. Friend. There is a great deal of good will in the industry. I have brought the British Consultants' Bureau and the Export Group of the Constructional Industry and the Building Materials Export Group together. I have asked my Parliamentary Secretary to be responsible for doing anything for the export drive to help these people. I am sure I have their good will.
    Mr. Costain: Has the attention of the right hon. Gentleman been drawn to the Cromer Report? Why did he not make reference to it? Is he coordinating in this matter with the Board of Trade?
    Mr. Mellish: This matter was discussed with these bodies when I met them and we have close links with the Board of Trade. At all the meetings I have held the Board of Trade has had representatives present.
    Mr. More: Is the Minister satisfied that the necessary co-operation is always obtainable from important authorities such as the Bank of England in questions of this kind?
    Mr. Mellish: That question concerns credit facilities. There is another Question on the Order Paper on that very point.

    Sand and Gravel
    Mr. McNamaraasked the Minister of Public Building and Works what action he is taking to encourage the production of sand and gravel from the sea to supplement supplies from the land.
    Mr. Mellish: I am exploring with other interested Departments and authorities the possibility of increasing the production of sand and gravel from the sea, for which it is clear there will be an increasing need. My Department has also discussed the problem with the Sand and Gravel Association.
    Mr. McNamara: I thank my right hon. Friend for that reply. Can he give some information about the comparative cost of land- and sea-produced gravel? Can he say whether he is satisfied that the saline content of sea gravel can be effectively eradicated? What effect has this extraction on coast erosion?
    Mr. Mellish: I cannot give an exact answer off the cuff about the cost, but the amount of sand we are now getting from the sea is 7 per cent. or 8 per cent. of total deliveries from all sources. We forecast that this year about 8·5 million tons of sand will be taken from the sea.
    Mr. Geoffrey Wilson: Is the right hon. Gentleman aware that 10 million tons of china clay sand are produced in Cornwall and it is excellent for building materials but the chief difficulty is transport charges? Has he looked into this matter to see whether this sand could be put to proper use?
    Mr. Mellish: I have met the sand and gravel people. They are extremely bright and I do not have to tell them how to get their sand.
    Mr. Scott-Hopkins: Will the right hon. Gentleman bear in mind that if we take sand from the seashore there is great danger of erosion and that we must pay attention to this?
    Mr. Mellish: Of course I understand that. The responsibility for granting licences for both prospecting and exploration licences lies with the Crown Estate Commissioners. They consult other Departments and planning authorities about such matters as fisheries and coast erosion.

    Construction Industry (Budget Proposals)
    Mr. McNamaraasked the Minister of Public Building and Works what discussions he has had with representatives of the construction industry following the Budget; and what was the outcome of these discussions.
    Mr. Mellish: I called an immediate meeting of representatives of the construction industry as soon as the Chancellor's Budget proposals were known. General agreement on the likely effects of the Budget proposals was reached at this meeting and the representatives said that they were glad to have been given this early opportunity for discussion. They particularly welcomed the announcement that Mr. Reddaway was to inquire into the effects of S.E.T.
    Mr. McNamara: While again thanking my right hon. Friend for that reply, may I ask him what estimates have been made to the effect of the Budget proposals on the cost of new building and on production?
    Mr. Mellish: I have already given those figures to the House in respect of S.E.T., the Budget proposals generally and devaluation. I recognise that there are difficulties for the industry, but in spite of those difficulties I still expect that output this year will be 4 per cent. more than last year—and output last year was an all-time record.
    Mr. Chichester-Clark: Does the Minister recall that on 11th March he told us that the effect of these proposals would be 2 per cent. in terms of cost? He has already doubled that figure. What estimate does he now give?
    Mr. Mellish: With respect, that is not so. These Questions have been answered on the Floor of the House. If the hon. Members wants me again to confirm my Answers, I am willing to do so.

    Building Research Station
    Mr. Arnold Shawasked the Minister of Public Building and Works what consideration he is giving to appropriate ways to mark the 50th anniversary of the Building Research Station in 1971.
    Mr. Mellish: The establishment of the Building Research Station in 1921 was effectively the beginning of organised construction research not only in this country but in the world. Its 50th anniversary will be the theme of special conferences and open days at the station. I intend also to invite the industry as a whole and its associated professions to mark the importance of the occasion in appropriate ways.
    Mr. Shaw: That Answer will give a great deal of satisfaction to everyone. Does the Minister believe that the public as a whole have sufficient knowledge of the work of the Building Research Station? As this station spends a good deal of taxpayers' money, is it not right that the taxpayers should know how it is being spent?
    Mr. Mellish: There is no doubt that the work of the station is widely known in the industry. Later in Question Time I shall have something to say about the way in which we get some of this information out to even the smallest builders. The work of the Building Research Station is well known and appreciated by the industry as a whole.

    Bricks and Cement
    Mr. Ellisasked the Minister of Public Building and Works whether he is satisfied that production and stocks of bricks and cement are adequate for the seasonal increase in building which is expected, and that no hold-ups will occur due to shortages of these materials; and if he will make a statement.
    Mr. Mellish: I am satisfied that there will be no national hold-ups due to shortages of either bricks or cement in the next few months.
    Mr. Ellis: While thanking my right hon. Friend for that reply, may I ask him how many days' supply are on hand in these commodities?
    Mr. Mellish: About one month's supply of bricks is in hand, which is very satisfactory. The demand for cement last year was 17·2 million tons and the capacity for this year is over 20 million tons. The delivery of bricks in March was 94 million up on the previous month.

    Royal Parks (Road Accidents)
    Sir R. Russellasked the Minister of Public Building and Works if he will state the number of pedestrians killed or injured by vehicles in the Royal Parks in any convenient recent period.
    Mr. Mellish: One pedestrian was killed, 12 were seriously injured and 16 slightly injured in the year 1967.
    Sir R. Russell: Is the right hon. Gentleman aware that there are very few facilities for pedestrians to cross the road in the Royal Parks? There are no pedestrian crossings—only police officers at infrequent intervals and at certain times of the day. Might not that be a cause of these accidents?
    Mr. Mellish: I am not complacent about these figures. May I put it to the hon. Member that zebra crossings and other traffic control paraphernalia in the Royal Parks run counter to the desire of most people who go into the Parks—which is to be quiet and to get some rest? If I had my way I would keep all motorists and all motor cars out of the Parks.
    Mr. A. Royle: Will the Minister give an assurance that he has no intention of putting pedestrian crossings or other such paraphernalia in Richmond Park?
    Mr. Mellish: I have no such intention.

    Selective Employment Tax
    Mr. Biggs-Davisonasked the Minister of Public Building and Works whether he will publish the evidence given to the Reddaway Inquiry by his Department on effects on the construction industry of the Selective Employment Tax.
    Mr. Rossiasked the Minister of Public Building and Works whether he will arrange for his Department to give evidence to the Reddaway inquiry into the effects of Selective Employment Tax.
    Mr. Mellish: No formal evidence will be furnished to Mr. Reddaway by the Government. He will, however, be given any help or information he asks for.
    Mr. Biggs-Davison: Nevertheless, will the Government take the opportunity to
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    explain to Mr. Reddaway how one keeps building costs down by taxing building workers?
    Mr. Mellish: The associations and professional bodies within the construction industry have been informed by me officially of Mr. Reddaway's address. Knowing them as well as I do, I have no doubt that they will tell him all that they think he ought to hear.
    Mr. Rossi: Will the Minister also tell Mr. Reddaway that the industry is totally opposed to the tax in its present form and wishes to see it abolished at the earliest possible opportunity?
    Mr. Mellish: The hon. Member must not under-estimate the associations to which I referred. If anyone is to tell Mr. Reddaway anything, they are the people to do it, not me.
    Mr. Speed: Will the Minister estimate the extra cost to local authorities of these additional costs on contractors working for them?
    Mr. Mellish: Not without notice.
    Mr. Roebuck: Is it open to those who wish to buy houses to tell Mr. Reddaway that they will support any measure which will reduce the over-manning in the building industry and lead to the introduction of more efficient ways of building houses?
    Mr. Mellish: Mr. Reddaway's terms of reference are concerned with the implications of S.E.T. I have done what I have to do as Minister—let all those connected with the construction industry know to whom they should write and where they should write. What they say is for them to decide.
    Mr. Chichester-Clark: But is it not very important to consider the effect on labour-only contracting? Surely the Minister should do something about that. Who will give evidence to Mr. Reddaway about that?
    Mr. Mellish: It is for him to ask for information. If he does, we shall supply it. My task as Minister is not to go to this man and this Committee and to make representations to them. It is for him to ask for information—and what he wants he will get from us.

    Overseas Construction Contracts (Credit Facilities)
    Mr. Chichester-Clarkasked the Minister of Public Building and Works what representations he has received from builders about the level of credit available for overseas construction contracts; and what reply he has sent.
    Mr. Mellish: I have had meetings with the construction industry about exports, at which references have been made to difficulties in obtaining guaranteed credit for overseas work early enough for tenders to be submitted in time. I have also had one representation from the Royal Institution of Chartered Surveyors about the level of credit available for professional work in certain overseas countries.
    These are both matters which my Department is pursuing with the Board of Trade.
    Mr. Chichester-Clark: Is the Minister aware that recently a very large contract in the West Indies was very nearly lost to a British builder because of the failure of the Bank of England to provide proper credit facilities? What is he doing about that?
    Mr. Mellish: The case to which the hon. Member referred has not been brought to my personal notice. At meetings which I have had with the organisations and professions, a representative of the Export Credits Guarantee Department was present. I can only tell the House what I am advised by these people, and I understand that they are generally satisfied that credit facilities are available.
    Mr. Frederic Harris: Will the Minister have in mind particularly the contracts which we are carrying out in the underdeveloped countries where this problem is one of paramount importance?
    Mr. Mellish: Yes, Sir. I note that point. I hope very much that those responsible for giving credit will take that very much into account.

    Agrément Board
    Mr. A. Hoyleasked the Minister of Public Building and Works what proposals he has to strengthen the Agrément Board; and whether he will make a statement.
    Mr. Mellish: I have no reason to believe that the constitution or powers of the Board are in any way inadequate. It is, however, important that the advantages of Agrément certificates should become more widely known and I have agreed with the Board that it should now give further publicity to its work.
    Mr. Hoyle: Will the Minister tell the House why the Board has issued only six certificates? Will he make the grant of an Agrément certificate grounds for exemption under the building regulations?
    Mr. Mellish: In fact, eight certificates have been issued, a further 21 products have been accepted for testing, of which seven are in the final stages, and a further 59 have been offered draft test contracts. This work is picking up. I hope to see the situation in which no new product which has not an Agrément certificate will be used by the industry. That is the situation at which I should like to arrive. But this Board has been operating for a very short time.

    Public Buildings (Cleaning)
    Mr. Whitakerasked the Minister of Public Building and Works what plans he has for the further cleaning of buildings within his responsibility.
    Mr. Mellish: I shall complete the work in hand on Trafalgar Square, the National Gallery, the National Portrait Gallery, the Admiralty Arch and the Mall facade of the Admiralty, and the Treasury; and at the Tower of London and the Royal Naval College, Greenwich.
    I am considering further cleaning in the light of the present financial situation.
    Mr. Whitaker: In view of the success of my right hon. Friend's present cleaning programme and its value for the tourist trade, may I ask him to look at the possibility of cleaning this Palace, the British Museum, the remaining buildings in Whitehall, the Tate Gallery and Burlington House?
    Mr. Mellish: I should like someone to give me a lot of money to do a lot of things. I shall certainly take account of my hon. Friend's request, and I am glad to have this opportunity to pay tribute to the officers of my Department and those who work with them for the marvellous job which they have already done.

    Construction Industry (Productivity)
    Mr. Scott-Hopkinsasked the Minister of Public Building and Works whether he will now make a statement on his plans for increasing productivity on construction sites where contracts being let by his Department are being carried out.
    Mr. Mellish: It is my policy to encourage methods of increasing productivity throughout the whole of the construction industry. On my Department's projects, productivity is encouraged both by providing continuity of work where practicable by such means as measured, term and continuation contracts, and by the forward planning of work inherent in the Government's firm price tendering policy. Contracts let in recent years have also included provision for improved site amenities, artificial lighting to minimise loss of normal working hours in the winter, precautions to permit building work to continue in cold weather and the provision of safety helmets for use by all personnel on sites.
    Mr. Scott-Hopkins: In the light of that very long reply, may I ask the Minister what further plans he has, in view of the increased cost which will flow from various provisions of the Transport Bill? What plans has he to offset increased costs for machinery, plant hire and so on?
    Mr. Mellish: The Question asked what I was doing to increase productivity. I have answered that in a long but, I thought, very good reply. Last year, productivity in this industry was 5 per cent. more than it had ever been before, with 2½ per cent. fewer men working in it. The results justify, at least, what we are trying to do.
    Mr. Costain: Does the right hon. Gentleman appreciate that British Standard Time will probably hinder the industry somewhat? Further, in the light of his long Answer, will he agree that the most satisfactory way to increase productivity would be to ensure that all plans were at the final stage before a job went out to tender?
    Mr. Mellish: I do not quarrel with that argument. I can only say that I meet representatives of the industry con-
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    stantly, and I believe that they are very confident about the future. This is an industry with a great deal of courage and confidence about not only the problems of today but the problems of tomorrow as well.

    Phelps Brown Committee
    Mr. Scott-Hopkinsasked the Minister of Public Building and Works what further representations his Department is making to the Phelps Brown inquiry into labour-only subcontracting.
    Mr. Mellish: My Department has given factual evidence to the Committee.
    Mr. Scott-Hopkins: Did not the Minister's own Department give a report on the census of employment in 1967 which showed an increase in the number of self-employed units, and does not he agree that the rise in the S.E.T. will increase the amount of self-employed groups working within the industry? Is not this a bad thing? Will the right hon. Gentleman comment on that?
    Mr. Mellish: The hon. Gentleman asked me what representations I had made to the Phelps Brown Committee. I have not tried to influence this Committee's findings. Its terms of reference are very broad. This is not a question of labour-only subcontracting, important though that is—I understand that—but the Committee will cover all aspects of the engagement and use of labour in the construction industry. It is a wide-ranging Committee.
    Mr. Chichester-Clark: My hon. Friend's Question was perfectly reasonable. If there has been an increase in the S.E.T., ought there not to be an increase in representations?
    Mr. Mellish: I do not think so. I am sure that Mr. Phelps Brown is fully aware of the effects of the S.E.T. If he does not know by now, I shall be very surprised.

    Royal Parks (Improvements)
    Mr. Whitakerasked the Minister of Public Building and Works what proposals he has for the improvement of public parks under his controls.
    Mr. Mellish: My general policy is to preserve the Royal Parks as places

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    primarily for quiet and peaceful enjoyment and recreation by the public. I shall continue to introduce improvements which are consistent with this policy, for example, in landscaping and gardening features, tree planting, refreshment facilities and the renewal as necessary of facilities for sport and recreation.
    Mr. Whitaker: To help forward this admirable policy, will my right hon. Friend look at the experiments which have been taking place in New York, details of which have been sent to him, including the closing of parks to motor traffic al weekends?
    Mr. Mellish: If that were practicable I should do it. In reply to an earlier Question, I let it be known that I do not favour making greater facilities available for motor traffic, and I say now to the R.A.C. and the A.A., "Please do not write to me and ask for more facilities"—they will not get them, as far as I am concerned. I can tell the House that I have just had a survey completed by some schoolboys of 16, which produced some splendid results. It shows that the vast majority of people in London, at least, want these places to be quiet and peaceful. I intend to ensure just that if I can.

    Office Building (Control)
    Mr. Shinwellasked the Minister of Public Building and works what restriction of office building is in existence under his regulations.
    Mr. Mellish: The Building Control Act, 1966, imposes a control on private building, including offices. Exemption is given to work which is under £50,000 or is in a development area or which is covered by an office development permit under the Control of Office and Industrial Development Act, 1965.
    Mr. Shinwell: Are these restrictions creating a scarcity value leading to an increase in rents, and is this putting further impositions on industry?
    Mr. Mellish: Since I have been Minister I have—I hope that I can use the phrase with modesty—been extremely generous. About 97 per cent. of all applications for licence have been granted. I am giving the matter further consideration.
    Sir G. Nabarro: Will the right hon. Gentleman bear in mind that, visually, it appears throughout London that there are a good many office blocks standing today offering premises to let. Evidently, there is no call for a substantial increase in offices in the London area.
    Mr. Mellish: I do not quarrel with that.

    New Construction Work
    Mr. Woodnuttasked the Minister of Public Building and Works what factors he has taken into account in estimating an increase by 1970 of the percentage of new construction work being carried out for the public sector.
    Mr. Mellish: I have allowed for all relevant factors affecting both the public and the private sectors. The recent Government decisions will have the effect of reducing the proportion of work carried out for the public sector from what it would otherwise have been by 1970.
    Mr. Woodnutt: Would it not be far better, in view of that state of affairs, to reduce the number of direct labour forces employed by local authorities in conjunction with the Minister of Housing and Local Government and put more of this work out to private enterprise, which can do it much more efficiently?
    Mr. Mellish: The hon. Gentleman will be interested in the figures: 91 per cent. of all new house building by local authorities is performed by private enterprise and only 9 per cent. by direct labour. I am sure that the hon. Gentleman will be the first to concede that there are many direct labour forces which have done and are doing a first-class job. There is no reason to denigrate them just because they happen to be direct labour.

    Forms
    Mr. Costainasked the Minister of Public Building and Works how many forms are in use by his Department; how many staff are involved in compiling and distributing them; and what administrative arrangements his Department has with the Board of Trade to avoid duplication.
    Mr. Mellish: I assume that the hon. Member's Question relates to forms issued for statistical purposes.

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    In 1967, eight types of form requesting information were sent to construction firms, 20 to manufacturers of building materials, and five to the public sector. The equivalent of 74 full-time staff were involved in compiling and distributing these forms. Officers of my Department discuss with those of the Board of Trade the coverage of inquiries, and there is also systematic co-ordination under the auspices of the Central Statistical Office.
    Mr. Costain: Does not the Minister realise that, if he has a number of staff preparing these forms, builders must have large numbers of staff for filling them in? What criteria does the right hon. Gentleman have regarding the time allowed for the return of these forms, and would he not get them used with more enthusiasm if he gave a better excuse for issuing them?
    Mr. Mellish: I say at once that I consider that there are too many forms and people are being asked for too much information. The more co-ordination we have on this, and the sooner we have it, the better. However, having said that, I must remind the hon. Gentleman that his industry, perhaps more than any other in the country, is anxious to have information, and the only way to get information is to ask people for it.

    Local Authority Houses
    Mr. Costainasked the Minister of Public Building and Works if he will give comparisons of output by private contractors and direct labour on council houses; and if he will make a statement.
    Mr. Mellish: When the price of work done by contractors in 1967 is divided by the number of their operatives, the answer is £600. When the cost of work done by direct labour departments of local authorities is similarly divided, the answer is £2,600. For a variety of reasons, these two figures are not comparable measures of productivity.
    Mr. Costain: The right hon. Gentleman keeps on suggesting that these figures are not comparable. Is he aware that, in the public sector, public authorities and public utility companies employing direct labour account for only 14 per cent. of output, yet they employ 25 per cent. of
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    the total labour force? How does the right hon. Gentleman explain that?
    Mr. Mellish: I gave the figures for new council house building, which is what the Questions asks. There is a later Question regarding maintenance, which is a separate matter, asking how much is done by direct labour, and so on. Again, I make the simple point that it serves no useful purpose to have what I call this ideological battle about whether work is done by private enterprise or by direct labour. There are very efficient strata in both private enterprise and direct labour forces. There is some bad private enterprise and some good private enterprise, and there is some pretty rough direct labour, too.
    Dr. Gray: Does not my right hon. Friend agree that direct labour forces make a contribution to competitive efficiency not only in output but also through their competitive tendering for contracts?
    Mr. Mellish: Some of them do. The truth about direct labour is that it can be a success only if management is successful. It is no good blaming the carpenter, the decorator or whoever it is. If management is not successful in direct labour, direct labour is a failure. Management is the key to seeing that direct labour forces are successful.

    Construction Industry Research and Information Association
    Mr. Carol Johnsonasked the Minister of Public Building and Works whether he is satisfied with progress being made by the Construction Industry Research and Information Association in increasing its membership; and if he will make a statement.
    Mr. Mellish: At the end of December, 1967, there were 610 member organisations, compared with about 440 at the inception of C.I.R.I.A. in March, 1967. While this represents encouraging progress, the membership remains only a small fraction of what could be achieved. The need for a first-class research and information association is widely acknowledged and I hope that the industry, its associated professions and the local authorities will rise to the occasion.
    Mr. Johnson: I am grateful to my right hon. Friend for that statement. Can

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    he say what steps he is taking to make this important research and information association better known?
    Mr. Mellish: Yes, Sir. Apart from my Department's publicising it to the best of our ability, I am also trying to arrange a link between C.I.R.I.A. and the Construction Industry Training Board at regional level. C.I.R.I.A.'s job is to some extent handicapped by the lack of finance, because a voluntary body must justify itself to members of the building and construction industry. It is well on the way to doing this, and it has a great future.
    Mr. Chichester-Clark: I accept the desirability of the organisation and its success and hope that the Minister will turn on the tap of publicity in a very big way, but does he accept that the industry would have responded a great deal better if it had not been burdened with one tax impost after another in the past few years?
    Mr. Mellish: The hon. Gentleman keeps going on about this and the taxes imposed. This is an industry with a tremendous record—past, present and future. I wish that the hon. Gentleman would be a little more optimistic about the future instead of being so miserable.
    Mr. Carol Johnsonasked the Minister of Public Building and Works what steps are being taken to set up regional facilities to co-ordinate the provision of advisory and information services available to the construction industry.
    Mr. Mellish: The Construction Industry Research and Information Association is engaged in appointing staff for a new regional advisory service. I have suggested to the Association and to other bodies making similar plans that there would be advantage in having one centre in each major regional city. This would provide the industry with easy access to the full range of services which are now available. Discussions on this proposal are now proceeding.
    Mr. Johnson: I welcome the new regional advisory service, but can my right hon. Friend say whether this will necessarily lead to an increase in the number of civil servants employed?
    Mr. Mellish: It will not, because the staff to be provided will be employed by the associations involved. This kind of rationalisation might well lead to a reduction in overheads, with consequential benefits to the industry at large. What I want is my own Ministry represented on the regional advisory service, because the time is overdue when the information and know-how in the industry should be sold, right down to the smallest possible builder. This is one way of doing that.

  TECHNOLOGY

    United States Aircraft (Cancellation Charges)
    Mr. Wallasked the Minister of Technology if he will now place in the OFFICIAL REPORT a table showing the various cancellation charges for all the United States aircraft ordered by Great Britain.
    The Joint Parliamentary Secretary to the Ministry of Technology (Mr. Gerry Fowler): I would refer the hon. Member to the Answer given to the hon. Member for Hendon, North (Sir Ian Orr-Ewing) on 20th March.—[Vol. 761, c. 106.]
    Mr. Wall: Is it not a fact that that Answer did not tell the complete story, and that all the costs for foreign aircraft, including the F111, were not included in it? Could the Minister tell us the full effect of all cancellation charges?
    Mr. Fowler: It is impossible at this stage to give the full picture including the F111. I have some idea of the likely level of cancellation costs, but the actual figures must be negotiated between the firms and the United States authorities on our behalf. I should prefer not to prejudice the course of these negotiations by hazarding a guess about their outcome.
    Dr. John Dunwoody: Does my hon. Friend agree that recent events in Vietnam demonstrated that if we had not cancelled the F111 the cost to the British taxpayer in the long run would have been infinitely greater than it may be now?
    Mr. Fowler: My hon. Friend may draw his own conclusions from the events in Vietnam. They are not strictly relevant to the Question on the Order Paper.
    Mr. Corfield: Will the Minister endeavour during the negotiations to widen the scope of the offset agreement to the maximum, bearing in mind that we buy a great deal of other material from America, quite apart from the proposal to buy the F111?
    Mr. Fowler: We are naturally extremely eager to sell all the British goods we can to the United States, particularly in the aviation field. We have had great successes recently, and I see little cause for worry in this case.

    Foreign-built Military Aircraft
    Mr. Wallasked the Minister of Technology what was the total cost to United Kingdom public funds of foreign-built military aircraft during each of the past five years; and what is the estimated cost for each of the next five years.
    Mr. Fowler: As the Answer contains a number of figures, I shall, with permission, circulate it in the OFFICIAL REPORT.
    Mr. Wall: Would not the first figure plus the cancellation charges have more than paid the British bill for the TSR2 and P1154 which the Government cancelled?
    Mr. Fowler: None of the figures which I shall circulate in the OFFICIAL REPORT would anywhere near pay for the TSR2.
    Mr. Lubbock: Can the hon. Gentleman say how much has been paid so far and what the total will ultimately be for the cancellation of the F111, and would he not agree that the Government made a deplorable error in ordering the aircraft in the first place?
    Mr. Fowler: The hon. Gentleman must look at the OFFICIAL REPORT for the detailed figures. I have already answered a question about the cancellation charges, and I do not want to prejudice negotiations by estimating any figure for them.
    Following is the information:
    The cost to Votes of purchases abroad—excluding co-partnership ventures and direct costs incurred in Britain—is as follows:

    £ million

    1964–65

    1965–66

    1966–67

    1967–68

    1968–69 (Estimate)

    1·4

    10·6

    12·0

    15·3

    54·3

    780
    These figures include the cost of items sub-contracted to the United Kingdom by United States contractors amounting to about £30 million. Figures for 1963–64 are not available. It is not the practice to give forecasts of expenditure beyond the year of Estimates.

    Aircraft and Armaments Experimental Establishment, Boscombe Down
    Mr. Corfieldasked the Minister of Technology (1) what steps he has taken to improve the security arrangements at the Aircraft and Armaments Experimental Establishment at Boscombe Down;
    (2) what records are kept, what accounting procedures adopted and what stocktaking undertaken at the Aircraft and Armaments Experimental Establishment at Boscombe Down; how it came about that equipment valued at £7,500 was stolen from the establishment; and what disciplinary action has been taken against the employees concerned.
    The Minister of Technology (Mr. Anthony Wedgwood Benn): The Establishment operates an approved system of stores control and stock-taking checks, the procedures varying according to the value and security classification of the stores concerned. The thefts, which took place over a long period, mainly involved small consumable stores and equipment from obsolete aircraft awaiting disposal, for which it is not practicable to account in detail. The main safeguard against losses of this kind is a random check by the police at the gate; a comprehensive daily check not being practicable.
    One of the employees involved in the thefts has been dismissed; the other two resigned.
    None of the stolen equipment was classified. The security of classified stores and documents is however kept under review, and improvements are introduced from time to time as necessary.
    Mr. Corfield: Is it not the case that, far from this offence being detected by the police at the gate, it was detected by the ordinary police when one of the offenders advertised this material for sale? Can the right hon. Gentleman tell us who was responsible and what action is being taken against him, bearing in mind that

    781
    we have had a recent incident of a chairman of a company being held responsible for the action of his subordinates?
    Mr. Benn: This is a case of theft from the stores concerned. I cannot, obviously, disclose to the House the measures which have since been taken to improve security, but the principle of Parliamentary responsibility makes me responsible for the affairs of the Establishment.

    Concorde Aircraft
    Sir J. Langford-Holtasked the Minister of Technology when he expects a revised date for the first flight of the Concorde 001 to be announced by the manufacturers.
    Mr. Benn: The French-assembled prototype is not now expected to fly before August, and it may be later. First flight of the British-assembled prototype remains planned for September. It will be some weeks before the manufacturers can give more precise indications of first flight dates.
    Sir J. Langford-Holt: The right hon. Gentleman said that the French aircraft may fly later than August and that the British aircraft will fly in September. Can he assure the House that, if it is ready, nothing will prevent the British aircraft from flying before the French one?
    Mr. Benn: I should remind the hon. Gentleman that there is no French aircraft and there is no British aircraft. Both aircraft are identical, one being assembled in Toulouse and one being assembled in Bristol. It is a great mistake for this to be regarded as a race between two companies which are assembling each other's components into one aircraft. But 001 has had priority, and it is our wish that this should he handled between the two companies on the basis of what is most sensible.
    Mr. Edelman: Can my right hon. Friend say when he will take a firm decision on the question of putting Concorde into production, especially in view of the industrial consequences which may follow?
    Mr. Benn: As my hon. Friend knows, production finance has been made available and some parts of a production aircraft are now being constructed. If he
    782
    asks, "When will the way be clear for the full production programme?", this to some extent inevitably depends upon the airline orders.

    Upper Clydeside Shipbuilders Limited
    Mr. Rankinasked the Minister of Technology if he will state the present composition of the board of the Upper Clydeside Shipbuilders Limited; what divisions on Clydeside are represented on the board, and by how many members; and how many further appointments are to be made to the board.
    Mr. Fowler: Apart from one director representing the Shipbuilding Industry Board, the composition of the board is the responsibility of Upper Clydeside Shipbuilders Limited, whose chairman has, I understand, discussed this matter with my hon. Friend.
    Mr. Rankin: I take it that in due course we shall hear that the board is complete? In the meantime, in the interests of good workmanship, will my hon. Friend take his own means of encouraging the new shipbuilders to keep in close touch with the men and the thinking of the men in the yard and try to base all wage increments on productivity agreements?
    Mr. Fowler: I am not sure that the last part of the supplementary question arises from the Question on the Order Paper. However, as to keeping in touch with the men in the yard and other interests affected, I can assure my hon. Friend that I and my right hon. Friend have every confidence in the new board and, in particular, in the chairman of Upper Clyde-side Shipbuilders Limited, and I am sure that they will do exactly this.
    Mr. Edward M. Taylor: Is it the intention to have a uniform wage structure in Upper Clydeside, and is the hon. Gentleman happier about the order position than he was a few months ago?
    Mr. Fowler: The first part of the supplementary question is a matter for the company and it would be improper for me to reply. As to the latter part, the answer is "yes, indeed". The order position is now much more encouraging, and we all hope that it will become more encouraging still as the benefits of devaluation become apparent in the order book of the company.

    A300 Airbus
    Mr. Hastingsasked the Minister of Technology whether he is satisfied with progress on development of the A300 airbus; and if he will make a statement.
    Mr. Benn: Yes, Sir. The purpose of the project definition phase is being realised with the progressive refinement of the design. We should be in a position to decide about further commitments to the project this summer as planned.
    Mr. Hastings: Does the right hon. Gentleman agree that there are areas where the A300 will have to compete with the DC10 and the Lockheed, and that the delays likely to result from international collaboration are at present unacceptable to this country; and will he hurry things up?
    Mr. Benn: The case for international collaboration is not only on the production side but also from the point of view of getting an assured market. The hon. Gentleman will know that the reason for the Government's European aircraft policy is that if one can get an assured market before one begins this is what justifies the effort. All international projects may tend to take rather longer in some respects than national ones, but this is the justification for what we have done.
    Mr. Corfield: In view of the announcement over the weekend that Boeing is determined to go ahead with an airbus which will be directly in competition with this airbus, what information has the right hon. Gentleman with regard to the attitude of Lufthansa, which, I understand, has a tie-up with Boeing and is absolutely vital to the European effort?
    Mr. Benn: The question of airline commitment is looked at individually in each country. It is not unknown for our airlines to take a view which does not correspond exactly with that of our own aircraft industry. However, we believe that the Lufthansa commitment to the airbus will go forward. Although Boeing has been making noises about its new aircraft, we still think that the A300 airbus will continue to be a proposition worthy of support.

    Wear Shipyards
    Mr. Willeyasked the Minister of Technology what further action has been taken by the Shipbuilding Industry Board regarding the merger of the Wear shipyards; and what is the position regarding any application for financial assistance.
    Mr. Fowler: The position has not changed since the reply to my right hon. Friend's Question on 18th March. I have recently discussed this with the Shipbuilding Industry Board, who are in touch with the companies concerned.—[Vol. 761, c. 13–14.]
    Mr. Willey: While the position about orders has much improved over the past month or two, will my hon. Friend ensure that the board keeps pegging at this? Otherwise, the Wear will be prejudiced compared with other shipbuilding districts.
    Mr. Fowler: I agree entirely with what my right hon. Friend has said. The Wear shipbuilders received a report by consultants nearly eight months ago. We hope that progress towards a merger on the Wear will be much more rapid in the immediate future than it has been during the past eight months.

    Furness Shipyard
    Mr. Willeyasked the Minister of Technology whether he will make a statement on the future of the Furness shipyard.
    Mr. Fowler: We are now considering the conclusions of the economic appraisal which has been made and hope to make a statement shortly.
    Mr. Willey: I appreciate my hon. Friend's prompt intervention, but is there any possibility of the yard being continued on a management basis, because orders have now come in to a much better extent than we thought possible a few months ago and it might be possible for orders to be carried out in this yard?
    Mr. Fowler: When my right hon. Friend says that orders have been coming in much better than we expected a few months ago, I think that he refers to the industry as a whole and, unfortunately, not to this yard, where new orders have been nil since devaluation,

    785
    which one would have expected to give a boost to all yards. As for management, there are various ways of arranging for a yard to be managed, but the essential problem is that a yard can be run only by an owner with considerable capital resources.

    Rolls Royce Limited, Coventry (Bristol Engine Division)
    Mr. Edelmanasked the Minister of Technology whether he will make a statement on the work situation at the Bristol Engine Division of Rolls Royce Limited, Coventry; and what are his plans to ensure that a high level of employment is maintained there.
    Mr. Benn: The distribution of work between the various factories of the Rolls Royce Group is a matter for the commercial judgment of the management. However, I understand that the company is currently considering what measures should be taken to improve the workload at the Coventry factories in order to alleviate the current short-time working.
    Mr. Edelman: Is my right hon. Friend aware that in the meantime there is considerable dissatisfaction inside this important factory owing to the fact that many men are on short time and there is a great deal of idle capacity at a time when much work is being subcontracted outside? Would my right hon. Friend look into this matter and try to arrange a better distribution of work so that Coventry can benefit from it?
    Mr. Benn: I understand this difficulty very well, because in my constituency capacity I have exactly the same problem raised with me from the Bristol Siddeley Engine Division of Rolls Royce. As my hon. Friend will know if he has gone into this, spare capacity and spare manpower do not necessarily mean that it is possible to transfer work, which may be of a different kind, or terminate a subcontract exactly in time to make the transfer of work possible. My hon. Friend will appreciate that Rolls has already begun to help in this direction, but the firm itself will be intensely busy over the next ten years.

    Northern Region
    Mr. Blenkinsopasked the Minister of Technology whether he will make a statement on further action taken or pro-
    786
    posed to be taken to increase the range of research and development work being undertaken by private industry and by Government Departments in the Northern Region.
    The Joint Parliamentary Secretary to the Ministry of Technology (Dr. Jeremy Bray): The Department has had a number of discussions with authorities in the Northern Region on proposals for technological development in the region, and these are continuing.
    Mr. Blenkinsop: When will my hon. Friend be able to say something rather more specific, as there is great anxiety over the great backlog in this field in the Northern Region?
    Dr. Bray: I much appreciate my hon. Friend's enthusiasm and anxiety to see progress here. I share his desire, as does my right hon. Friend. We are wasting no time.
    Dame Irene Ward: Is the hon. Gentleman aware that on the North-East Coast we think that there is too much talk and too little action? With great respect to the hon. Gentleman, I would feel much happier if the right hon. Gentleman could tell us how he is getting on in the Cabinet, who are obviously the niggers in the woodpile.
    Dr. Bray: The hon. Lady is quite misinformed about the extent of the action that there has been. There has been an N.R.D.C. project of £¾ million with Welwyn Electric, a £1 million project for the development of transducers by an instrument firm, and projects for a superconducting motor at I.R.D.
    Mr. David Price: Does not the hon. Gentleman agree that part of the answer to this question is for the two major universities in the North-East, particularly in their engineering departments, to get as close contact as possible with the developing industries and the highly technological industries which are sited in the North-East?
    Dr. Bray: Yes. The hon. Gentleman makes a very important point and one which we are pursuing with both universities at present.

    Small Shipyards
    Mr. George Jegerasked the Minister of Technology whether he has given

    787
    further consideration to the recent representations made to him about the difficulties of the smaller shipyards situated outside development areas; and what action is now proposed to ensure their survival, especially in view of their contribution to the export drive.
    Mr. Fowler: My right hon. Friend is considering the information provided by the hon. Member and will be writing to him shortly. There is considerable scope for shipbuilders outside development areas to improve their competitive position. Shipbuilders' relief, assistance under the Shipbuilding Industry Act and the benefits of devaluation are available to all yards, but I am not convinced that all yards outside the development areas should also be treated as though they were in those areas.
    Mr. Jeger: Is my hon. Friend aware that it is rather invidious to give to one of the shipyards concerned the Queen's Award in consideration of its export achievements and, on the other hand, to leave it exposed to the possibility of being closed owing to unfair competition? Will he remind my right hon. Friend the Minister that several weeks ago I asked him to receive a further deputation about this matter, which he promised to do some time ago, and that I am still waiting for a reply?
    Mr. Fowler: With regard to exports, my hon. Friend is well aware that our yards, whether inside or outside development areas, when competing with foreign competitors must stand upon their own feet. Yards outside the development areas cannot complain that they are at a disadvantage because they do not receive a subsidy in competing with foreign rivals. Their record is, in general, excellent. We would not crib at this, but they must not ask for a general subsidy.
    Mr. Corfield: Does not the unfairness arise purely from the difference in the way yards are treated in regard to S.E.T.? Does it not follow that, if a yard outside the development areas is in fact competing, it is very doubtful whether yards inside ought to be subsidised against their obviously very much more efficient competitors outside?
    Mr. Fowler: I am very interested to hear the hon. Gentleman arguing in
    788
    favour of the proposition that all help to the shipbuilding industry should be abolished so that there is no discrimination between yards inside and outside development areas. I am sure that his remarks will be read with great interest by yards inside development areas. It is the Government's policy to develop employment inside the development areas—the areas of traditionally high unemployment. This policy cannot be got over by saying that the subsidy should become generalised.
    Mr. David Price: In that context, will the hon. Gentleman bear in mind that there is a feeling, rightly or wrongly, amongst shipbuilders outside development areas that, not only do shipbuilders in the development areas get—very properly—the advantage which is part of regional policy, but that when it comes to competing for Government contracts, other things being equal, the Government are prejudiced against shipyards in the development areas? I should have thought that it would be right for them to be treated equally, given the advantage that is obtained through the various development district policies.
    Mr. Fowler: I think that the hon. Gentleman means that there is a feeling that there is a prejudice against yards outside the development areas. He said, "in the development areas". There may be this feeling. The hon. Gentleman knows as well as I that all sorts of irrational feelings exist. There is no evidence to support the proposition he has just made, and I can assure him that there is no truth in it.

    Scotland (Technological Industry)
    Mr. Rankinasked the Minister of Technology what proposals he has for a greater expansion of the technological industry in Scotland.
    Dr. Bray: The Ministry of Technology takes every opportunity to encourage the expansion of advanced technological industry in Scotland as in other development areas. The announcement on 23rd April by the Burrough's Corporation of the decision to establish a new computer factory at Glenrothes, initially to employ 1,000 people, marked the latest example of the expansion of advanced technological industry in Scotland.
    Mr. Rankin: I thank my hon. Friend for that intimation. Is he aware that I am thinking on a much wider scale? Does he recollect that, since we lost the aircraft maintenance industry at Renfrew, Scotland has been left only with the engine side, employing 12,000 persons? Does he not think that we should now be getting a development on the airframe side, with the technological equipment that goes with it, to compensate for the heavy outflow of skilled manpower to England?
    Dr. Bray: I am well aware of Scotland's need for employment in the engineering industry. I hope that my hon. Friend will not ignore the tremendous advantages which flow from the great concentration of the computer industry in Scotland at present. Indeed, this industry is rapidly approaching the point of take-off in this very important part of the country.

  MURDER TRIALS (PRESENTATION OF FACTS)
  The following Question stood upon the Order Paper:
  Mr. BOYD-CARPENTER: To ask the Attorney-General whether he is aware of the fact that in the recent case of R. v. Sokol at Leeds Assizes the effect of recent legislation was to prevent any public knowledge of the facts relating to a case of murder being available to the Press and public either at the committal or trial stage; and whether, in view of the need that public justice be seen publicly to be done, he will introduce amending legislation.
  Mr. Speaker: Mr. Roebuck.
  Mr. Boyd-Carpenter: Is it not your intention, Mr. Speaker, to call Question No. 35 in my name?
  Mr. Speaker: I was informed that the right hon. Gentleman did not wish to put his Question.
  Mr. Boyd-Carpenter: That must plainly be a misunderstanding.
  Mr. Speaker: A breach in communications. Mr. Boyd-Carpenter.
  The Attorney-General (Sir Elwyn Jones): I refer the right hon. Gentleman
  790
  to the Answer given by my right hon. Friend the Home Secretary to a similar Question by the right hon. Gentleman on 11th April.—[Vol. 762, c. 1574.]
  Mr. Boyd-Carpenter: Is the Attorney-General aware that the Home Secretary's Answer indicated a complete failure to appreciate that recent legislation has left the constitutional principle of public justice being done in public dependent on nothing more than a practice direction? Is not this case an indication of the need for amending legislation?
  The Attorney-General: I do not think so. The Act has been in force for only a very short time. Let us see how it works. If it proves unsatisfactory in operation we shall certainly look at it again.
  Mr. Alexander W. Lyon: Does my right hon. and learned Friend agree that the Sokol case would not have given rise to any public misapprehension if the learned judge in the assize court had permitted the prosecuting counsel to do what he intended to do, namely, to give a summary of the facts, and that there were not committal proceedings in the normal sense in a lower court since the attenuated procedure provided for in the Criminal Justice Act was applied?
  The Attorney-General: I agree with what my hon. Friend said. I hope that the practice direction now given by the Lord Chief Justice has put the matter right.
  Mr. Carlisle: I accept that the practice direction has put right the point raised in the Question, but would not the Attorney-General reconsider amending the Criminal Justice Act to see that in cases where oral evidence is given at the committal proceedings the Press is free to report it in accordance with the principle that justice should be open?
  The Attorney-General: We discussed this in great detail during the passage of the Act through both Houses. It is prudent to see how it works, and then we shall have another look at it.

  COUNTY COURTS (VOLUNTARY WELFARE OFFICERS)
  Mr. Roebuckasked the Attorney-General what county courts make use of voluntary welfare officers in cases involving racial or other social difficulties.
  The Attorney-General: Where it appears that the help of a welfare worker would be desirable in a case involving racial or social difficulties a county court usually refers the case to the local authority's welfare officer or children's officer; to a mental health officer or probation officer; to the local Citizens' Advice Bureau; or in a matrimonial case to the designated court welfare officer. Considerable use is also made of the services of voluntary welfare officers and organisations in appropriate cases where their services are available.
  Mr. Roebuck: I am grateful to my right hon. and learned Friend for that reply. Is he certain that that procedure is followed by all county courts? If not, could he arrange for them to be circularised on the benefits of this system?
  The Attorney-General: I think that it is pretty widely used. County court judges have been grateful for assistance from voluntary welfare workers and organisations. The problem is perhaps that they are not as widely available as one would hope.

  GROSVENOR SQUARE DEMONSTRATION (GERMAN STUDENTS)
  Mr. Hastingsasked the Attorney-General what organisations sponsored the arrangements for the German students to take part in the Grosvenor Square demonstration on Sunday 17th March.
  The Attorney-General: I have received no evidence that any organisation in this country sponsored the arrangements for the German students to take part in the Grosvenor Square demonstration. It appears that they were invited by the Vietnam Solidarity Committee, organisers of the demonstration.
  Mr. Hastings: Would the Attorney-General care to tell the House whether the Vietnam Solidarity Committee paid, or had something to do with payment, for these students' travel and other arrangements? Surely there must have been some organisation on the other side of the Channel? Is not the truth that the real
  792
  source lies in East Germany rather than West Germany? When shall we hear the true story?
  The Attorney-General: I have no evidence or information that the students were paid to come or that their fares were paid. I have no information as to any organisation that sponsored them in that sense. If the hon. Gentleman has any information, I should be very glad to have it examined.
  Mr. Shinwell: Can my right hon. and learned Friend say whether these German students were residents of this country for any length of time? Did they remain here, and if so, why?
  The Attorney-General: No, Sir. They came expressly for the purposes of the demonstration and went away immediately afterwards. The names of some were taken and, as my hon. Friend the former Under-Secretary of State for the Home Department has said, in future steps will be taken to see that individuals are not allowed into this country for demonstrations if it is thought that they will abuse that facility to foment disorder and cause injury and damage.
  Sir P. Rawlinson: Were not inquiries made of the immigration officers as to the purposes of the visit, and was it not obvious that the introduction of this posse of Germans from abroad might lead to breaches of the law?
  The Attorney-General: Of course inquiries were made, but the conclusion to which the right hon. and learned Gentleman has referred was not obvious. Students who come here for peaceful purposes, to take part in peaceful demonstrations, should not be prevented, but if there is evidence that they come to cause mischief of the kind that I have indicated they ought to be kept out and will be.
  Mr. Whitaker: Is my right hon. and learned Friend aware that the South Vietnamese Embassy in London spent money unsucessfully trying to organise a demonstration in Trafalgar Square? Does he think that diplomats accredited here, of any persuasion, should spend money in that way?
  The Attorney-General: I did not know, but it does not arise from the Question.

  MINISTRY OF LABOUR

    Women's Employment (Survey)
    Mrs. Joyce Butlerasked the Minister of Labour if she will publish the survey on women's employment which has been prepared on behalf of her department.
    The Joint Parliamentary Secretary to the Ministry of Labour (Mr. Harold Walker): Yes, and publication is expected in early May.
    Mrs. Butler: When is the report to be published, because it is absolutely vital, as it reveals that 4 million women are earning the pitiful wage of less than 5s. an hour, that all this information should be available in the current discussions on prices and incomes and equal pay for equal work?
    Mr. Walker: I cannot anticipate the contents of the survey, but it is intended to publish the full text of the report in the first week of May and a fuller volume of the tables which are relevant to it a week or so later.

    Departmental title
    The following Question stood upon the Order Paper:
    Mr. KENNETH LEWIS: To ask the Minister of Labour what new title it is proposed to give to her Department.
    Mr. Speaker: Mr. Lewis to ask Question No. 61.
    Mr. Lewis: On a point of order. How can we have a Minister replying for the Ministry of Labour when we do not have such a thing as the Ministry of Labour? Is this another example of the Government being too late? I understand that there is a Motion on the Order Paper for discussion on Wednesday to change the name of this Ministry, but it has not yet been changed. The Minister who has just replied is the Joint Parliamentary Secretary to the Department for Employment and Productivity, not a Parliamentary Secretary to the Ministry of Labour.
    Mr. Speaker: This matter was dealt with on business questions last week. The hon. Member for Rutland and
    794
    Stamford (Mr. Kenneth Lewis) has now unfortunately lost the chance to put his Question No. 61.

BERMUDA
Mr. James Johnson Mr. James Johnson (by Private Notice) asked the Secretary of State for Commonwealth Affairs whether he will make a statement on the situation in Hamilton, Bermuda.
The Secretary of State for Commonwealth Affairs (Mr. George Thomson): Yes, Sir. I regret to tell the House that on the night of 25th April there were disturbances in the Colony of Bermuda. The disturbances continued on the night of the 26th, in the course of which several fires were started. Fourteen persons were injured, including five police officers, but, I am glad to say, there was no loss of life. There has been much damage to property.
On the 26th a state of emergency was declared, the Bermuda Regiment was embodied and the police reserves were called out. At the request of the Governor, H.M.S. "Leopard" was diverted to Bermuda on the 27th, and a company of the Royal Inniskilling Fusiliers was sent from this country on the 28th. The situation is now quiet. One hundred and four arrests have been made, including a number for breaking the curfew.
The Governor has announced that he will appoint a Commission of Inquiry into the causes of the disturbances and the House would not wish me to say more about that aspect before that Commission has reported. I am sure that it would be the wish of the whole House to join me in the hope that this small island will soon return to the tranquility of which it has hitherto been so proud.
Mr. Johnson: I thank my right hon. Friend for that reply. Does he not consider it unusual, as I do, that such a small incident occurring at a fair in support of handicapped children should spark off such a serious situation? Is there not a danger in the fact that the police force is mainly white in a predominantly negro population? Has my right hon. Friend seen the leading article in The Times of today—
Mr. Speaker: Order. Even Private Notice supplementary questions should be brief.
Mr. Johnson: Does not the leading article in The Times, a searchlight on political disequilibrium, show the fundamental cause lying deep below the surface?
Mr. Thomson: Our unhappy experience in a number of different parts of the world recently is that sometimes only quite a small incident is needed to spark off regrettable trouble. I do not think that the composition of the police force in Bermuda is the major factor in this matter. The force is multi-racial, but it has great difficulty in persuading Bermudians, whether white or coloured, to volunteer in sufficient numbers and in these cases posts often have to be filled by recruitment from overseas.
Mr. Braine: We fully share the right hon. Gentleman's regret that these disturbances have taken place and certainly support the prompt sending of British troops. We are very glad to learn—and perhaps the right hon. Gentleman will again confirm that this is so—that since their arrival the situation has quietened. Can he say whether there has been any injury or loss to British personnel or property? As the Governor is to set up a Commission, it might be improper to ask further questions, but will the right hon. Gentleman undertake to report any development to the House?
Mr. Thomson: I can immediately confirm that, as always happens when British forces arrive, there was an immediate quietening effect. I shall seek to keep the House informed of any new developments. As Bermuda is a British Colony, it is not possible to distinguish British-owned property from property owned by other people, but I regret to have to tell the House that the damage to property has been substantial.
Mr. Driberg: Will my right hon. Friend give an assurance that those who are investigating the cause of the riots will seek to find out whether they are due to the political frustration of the supporters of the party against whom the constituency boundaries have been gerrymandered?
Mr. Thomson: Yes, Sir. I can assure my hon. Friend that when the Commission of Inquiry is set up it will have terms of reference which will enable it to make the most thorough investigation into the background to these troubles.
Mr. Dodds-Parker: Does not this incident underline the necessity for having adequate reserves for even the happiest and quietest of places?
Mr. Thomson: I draw the hon. Gentleman's attention to the fact that the troops concerned went there at a few hours' notice and that the strategic forces available in this country will continue to be available.
Mr. Will Griffiths: Does my right hon. Friend yet know the personnel who will comprise the Commission? May we have an assurance that a majority of the Commission will be representative of the coloured majority in the island of Bermuda?
Mr. Thomson: I cannot give any information about that yet. The Governor has only just taken his decision to set up the Commission, but I will certainly carefully bear in mind the important point which my hon. Friend makes.
Mr. Lubbock: Were the Inniskilling Fusiliers air-lifted by R.A.F. Air Transport Command? If so, on behalf of the House, will the right hon. Gentleman congratulate Transport Command on doing the job so quickly and draw to the attention of the House the splendid service which this Command can render to people in islands like this now that it has the Super VC10 in service?
Mr. Thomson: Yes, Sir. I am happy to join the hon. Gentleman in paying tribute to Transport Command. I myself took the decision about sending the forces yesterday morning and the troops were in Bermuda by teatime local time. In fairness, I ought also to pay tribute to the crew of H.M.S. "Leopard" who, not only in Bermuda, but in a number of other islands in the area, have responded promptly and effectively to calls for help to pacify troublous situations.
Mr. John Lee: Is it not obvious that these riots were, at any rate in part, caused by dissatisfaction with the Constitution? Will the terms of reference

797
of the inquiry enable it to look at the Constitution as well as the immediate cause of the disturbances?
Mr. Thomson: I should not like to seek to prejudgie what the Commission may find to be the cause of the riots, but I have already given an assurance that the Commission of Inquiry will be able to make the most searching investigation. As for the constitutional aspect, the Governor is dissolving the Legislative Council later this week and a general election under the new Constitution, which has been approved by this House, will take place on 22nd May.
Mr. Henry Clark: The House will have little doubt about the ability of Lord Martonmere to pick a wise Commission of Inquiry, but will the right hon. Gentleman seriously consider offering the services of advisers, experts and others in this country to assist the Commission's work, for in a small Colony like Bermuda it must be difficult to get a full spread of views and complete impartiality?
Mr. Thomson: I join the hon. Gentleman in his remarks about the Governor, Lord Martonmere, who is well known to hon. Members on both sides of the House. I have been in touch with him by telephone today and assured him that we should be ready to give whatever expert help was necessary.
Mr. Michael Foot: Does my right hon. Friend's reply mean that this Commission of Inquiry will report before the general election takes place, for some of the issues in dispute affect the whole question of registration, which obviously affects the election? Does he recall that when the Bill went through the House there was deep concern about many of its constitutional provisions and that certain undertakings were given which would affect the election itself? Can we have a report from my right hon. Friend about how those undertakings will be implemented?
Mr. Thomson: The undertakings given by my right hon. Friend the then Minister of State have all been carried out. However, our main undertaking related to the future and it was that if, after the general election under the new Constitution, the Government of Bermuda or any
798
of the parties in Bermuda wished to discuss further changes, in any direction and involving constitutional matters, Her Majesty's Government would be ready to discuss them.
Sir Knox Cunningham: The right hon. Gentleman told the House that he took the decision to send the troops. Surely this is a matter either for the Cabinet or the Secretary of State for Defence, not for him?
Mr. Thomson: If I had waited until today for the opportunity of a Cabinet meeting on this, the very first Member to rise on the opposite side of the House to criticise me for being dilatory might well have been the hon. and learned Gentleman.

BRITISH HONDURAS
The Secretary of State for Foreign Affairs (Mr. Michael Stewart): With your permission, Mr. Speaker, and that of the House, I should like to make a statement concerning the United States mediation in the dispute between Guatemala and the United Kingdom over British Honduras.
I am glad to be able to inform the House that copies of the Mediator's proposals have been placed in the Library of the House. These proposals envisage independence for British Honduras and a settlement of the dispute between the United Kingdom and Guatemala. We shall now study them in consultation with the Government of British Honduras, who have already been given the proposals. These proposals are being released publicly in British Honduras today.
Until this process of consultation has been completed it would not be appropriate for me to comment on the substance of the proposals, beyond saying that Her Majesty's Government will, of course, give them very serious consideration. We hope that all others concerned will do the same.
I wish to take this opportunity of paying tribute to the United States Government, who agreed three years ago to undertake this mediation and to Ambassador Bethuel Webster, the Mediator, who has worked so long and so diligently to find a just and practical solution to this very difficult problem.
Mr. Maudling: May we on this side of the House be associated with the tributes paid to the American Government and the Mediator. We are glad that he is thinking in terms both of independence of British Honduras and a settlement between the United Kingdom and Guatemala. Is the Foreign Secretary aware that the great problem has been to reconcile these two things all the time? Can he perhaps give the House a summary of these proposals? Can he also reassure us that if a conflict should arise the interests of the people of British Honduras will remain paramount in the minds of Her Majesty's Government?
Mr. Stewart: I can give the undertaking for which the right hon. Gentleman asks. I would doubt the wisdom of my trying to give to the House a summary of the whole Mediator's Report and the draft Treaty, but it is available to hon. Members. In any case, it is something that the Government are still studying.
Mr. James Johnson: In view of the deepest anxiety felt by the Opposition Party in Belize, and the past history of the dispute, can the Foreign Secretary give the House a pledge that this will not be in any way what is popularly termed a "sell out" to Guatemala, particularly before independence? Is he aware that we hope there will be elections in the State of British Honduras?
Mr. Stewart: I can certainly give that assurance and when my hon. Friend studies the terms of the Report he will see very clearly that this is so.
Mr. Doughty: Could the Foreign Secretary give an undertaking that if British Honduras, after independence, has difficulty in maintaining its independence, for financial or other reasons, it will have the full support of this Government and this country, so that it is not subjected to undue pressure from Guatemala?
Mr. Stewart: I do not think that the hon. and learned Gentleman will expect me to enter into a hypothetical financial commitment of that kind. It is well known that we have already given considerable help to Honduras.
Mr. Maxwell-Hyslop: Can the Foreign Secretary tell us whether the Mexican claim, which was advanced at one stage,
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has been irrevocably withdrawn, or is it likely to appear at some stage in future?
Mr. Stewart: That is a question for the Mexican Government. In any case, the Mexican claim is outside the terms of this mediation.
Mr. Philip Noel-Baker: In view of the great importance of this dispute, and the process which has been adopted for a peaceful settlement, would the Foreign Secretary consider giving us a White Paper containing the American proposals?
Mr. Stewart: The proposals are to be available to the House, but I will consider a White Paper.
Mr. Driberg: In addition to placing the report in the Library, would it not be more sensible to follow the suggestion of my right hon. Friend the Member for Derby, South (Mr. Philip Noel-Baker) and publish the Report, either as a White Paper, or in HANSARD, or simply just publish it, as it is being published in British Honduras anyway?
Mr. Stewart: As I said, the document is available to hon. Members, but it is something which the Government are still studying and which, I hope, others will study. It may be desirable to issue a White Paper containing not only the terms of this, but the Government's views on it, at a later stage.
Mr. Dodds-Parker: While I have not seen the Report, can the right hon. Gentleman say whether it is proposed to hold elections before independence in Honduras?
Mr. Stewart: That would depend on arrangements to be made between Her Majesty's Government and Honduras. My right hon. Friend the Commonwealth Secretary has stated that if he receives a request for a conference on independence he would be happy to accede to it, although no such request has, as yet, been made.
Mr. Biggs-Davison: Will the Government undertake to give the Government and people of British Honduras any support that they may need in gaining their independence?
Mr. Stewart: This, again, is a hypothetical question. I am being asked for

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large general answers which it would not be sensible to give.
Dame Joan Vickers: Before the Government make up their mind, would they be prepared to receive a delegation from the people of British Honduras?
Mr. Stewart: We shall proceed throughout this matter in consultation with British Honduras.
Mr. Maudling: May I press the point about the question of publication in this country? The Report is apparently being published in British Honduras, but not here. Putting the document in the Library is not quite good enough. Can the Foreign Secretary go further on this? Will he also deal with the question of a constitutional conference?
Mr. Stewart: I will consider whether we ought to take steps for further publicity.
On the question of the constitutional conference, I dealt with this in reply to a question from the hon. Member for Cheltenham (Mr. Dodds-Parker). No request so far for such a conference has been made, but my right hon Friend the Commonwealth Secretary has stated that he would be happy to accede to such a request if it were made.
Several Hon. Members Several Hon. Members rose—
Mr. Speaker: Order. Mr. Peart.

PERSONAL STATEMENT
The Lord Privy Seal and Leader of the House of Commons (Mr. Fred Peart): With permission, I would like to correct a slip I made last Thursday afternoon, when we were discussing the week's business.
In reply to a question by the hon. Member for Louth (Sir C. Osborne), I said that I expected that the Government's Prices and Incomes Bill would be published in the middle of next week. I should have said "in the middle of next month". In the haste of the moment I failed to spot the verbal error in my notes.
I have already given an explanation and apology to the hon. Member personally, and I am grateful for this opportunity to correct any false impression that I may accidentally have given to other right hon. and hon. Members.

PENSIONS (TRANSFERABILITY RIGHTS)
3.47 p.m.
Sir Brandon Rhys Williams: I beg to move,
That this House, noting the injustice and frustration suffered by people who are now liable to incur the loss of their pension rights if they change their employment, calls upon Her Majesty's Government to take urgent action to ensure that pension rights can under no circumstances be extinguished and in every practicable case should be made fully transferable on change of employment if required by the beneficiary.
When I was elected for South Kensington I thought that I was probably one of the luckiest men in British politics. When, on my arrival in this House, I won the Ballot for Private Members' Motions in my first month I thought that I was also one of the luckiest Members in the House. I wish that I had the expertise in advocacy and the distinguished legal mind of my extremely popular predecessor, Mr. William Roots. He was loved in all parts of this House, and I am extremely glad to be able to report that he is continuing to make good progress in his health. His wife told me only today that he is definitely on the mend.
My predecessor would have been able to make much better use than I can of this opportunity and I therefore ask the House to be indulgent, as it is the first occasion that I have spoken here. This Motion is not a matter of party controversy, because during the last election both the radical parties, and the Conservative Party, also, included a recommendation in their manifestos that something should be done about it. Although the distant objective is quite clear to us all, the way to it is a stony one and it goes through a veritable minefield of technicalities. The way is littered with Private Members' Bills, official reports, Government surveys and the like—all have either been abandoned or neglected.
The basic facts are these. Probably between 12 and 14 million people are now covered by occupational pension schemes, and the number is reputed to be growing at the rate of about 500,000 people a year. About 4 million of those people are included in statutory schemes—that is, schemes covering the Civil Service, local government, nationalised industries and other statutory bodies. The remainder are covered by at least 60,000

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separate schemes. All the best schemes aim to offer between half and two-thirds of final salary at the completion of the beneficiary's career, plus, in some cases, a lump sum. But conditions vary enormously and it is extremely difficult to generalise.
The total amount being subscribed to all these different types of scheme, taking employers and employees together, is said to be well in excess of £1,000 million a year. The law covering all these schemes is an almost incomprehensible tangle, and it has never dealt adequately with the circumstances which arise when people change their jobs and wish to move their pension from one scheme to another. The initiative to put the matter right rests not with the employers or with the trustees of the many various schemes, and certainly not with the Inland Revenue, but with Parliament. Until something is done, continuing loss will be suffered by the large number of people who change their jobs every year. The best estimate which one can obtain suggests that the extent of these losses is now about £1 million every week.
I believe that a very high proportion, certainly the majority, of all the people at work in Britain today are not making the fullest use of their experience, training and capacity. When we say that something is wrong with the British economy, we are simply speaking in an abstract way. What we should say is that there are millions of people working in places or organisations where, whether they know it or not, they are less usefully and less gainfully employed than they might be. This is a situation where Parliament could usefully intervene in the working of the economy, and it should do so without delay.
The country needs people who are prepared to move from one firm to another in order to broaden their experience and so make themselves fit later in their careers for the responsibilities of general management. This is especially necessary in an industrial world which is tending increasingly towards specialisation. We need people who are willing to change their jobs to help with industrial training or themselves to take extended courses of training. Above all, we need people with resources behind them which will make it possible for them to walk into their works
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manager's or export director's office, or perhaps the office of the chairman of the firm for which they are working, and say, "I do not like the way in which you are running this organisation. I am leaving."
Unfortunately, this all too seldom happens. We need people who are able to take this initiative so that they can exercise the pressure for efficiency which could undoubtedly be raised if people in the junior and intermediate ranks of management had greater independence. What goes for the private sector of industry and business, I am sure, goes equally, if not more so, for the public sector.
Apart from the purely economic issues, we must consider the question of justice. I heard a few days ago of a Member of the House, a man highly respected on both sides of the House, who, when he came here, lost pension rights which had accrued on his behalf for over 28 years. If I may be excused a personal note, I spent about one-third of my working life with one of our largest industrial organisations. When I left a few years ago I was allowed to draw out of the pension fund a sum of money which was equal to, I suppose, only about a quarter of the genuine asset value of the accrued pension rights standing in my name. But I was fortunate, because had I been working in a firm with one of the so-called non-contributory schemes I should have received nothing at all.
In these days it is very difficult for a man, particularly a white collar worker, to amass any savings before middle life, because while he is waiting to reach his maximum rate of earnings he is probably running into the highest rate of outgoings that he will encounter in his career. He is probably paying for his house and bringing up his children at the same time. It is therefore important that he should be able to protect the savings which he has been able to make by joining an occupational pension scheme.
I turn to specific recommendations. I hope that in doing so I shall not weary the House, but this is a highly technical subject and one is bound to be specific if one is to make any useful contribution. Connoisseurs of this subject will recognise that at several points I differ from the findings of the Morgan Report, which was published about two years ago by the

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Ministry of Labour. I pay tribute to that Report in many respects, but it was rather timid in some of its conclusions. What it says about the significance of the problem of the transferability of pension rights on the mobility of labour is so utterly at variance with my own observation and, I think, that of people who have more experience than I have of the case work involved when people are seriously considering changing their jobs, particularly for white collar workers and worker over 40 years of age, that its findings should be treated with considerable reserve.
First, I suggest that we should appoint a Registrar of Approved Pension Funds. At present, pension funds fall between several stools. They may come within the purview of the Registrar of Friendly Societies; they may come under the Registrar of Non-Participating Employments; or, perhaps, they are simply supervised by the Inland Revenue which, in this respect, is acting rather outside its proper capacity. The Registar should oversee the creation of new schemes and, what is particularly important, the amendment and amalgamation of existing schemes. He should adjudicate in disputes and settle problems arising from transfers, and he should publish regular reports. It is ridiculous that in order to find out what is happening in this immensely important sphere we should have to arrange for the Government Actuary to make spot checks on the situation every 10 years or so and publish a report which cannot be final or conclusive.
The cardinal principle should be established that in all pension schemes seeking the relief of taxation on accruing interest and capital gains, the fund should be seen to he the inalienable property of the beneficiary. Once the employer has made his contribution to it, no part of the fund should be deemed to be the property of the employer. It is quite wrong that for disciplinary reasons, or when employees leave the firm, the employer should have any option to recover what he has paid into the pension fund.
If employers wish to give long-service bonuses or awards of that kind as a right, there is no reason why they should not do so; but they should not expect to be able to claim the benefit of the valuable special concessions in taxation
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which are allowed for the purpose of building up pension funds on behalf of their employees. Pension rights, in other words, should be identified firmly and finally as deferred pay and should not be seen to be a fund partly or wholly belonging to employers.
I think—and this is an important point although a rather technical one—that we should establish clearly the difference between a transferable pension and a preserved pension. For a person to take his pension with him when he moves from one firm to another is generally much more favourable than building up a series of frozen pensions left behind with former employers. This is not simply because of the effects of inflation, but because the best schemes—indeed, a very large number of schemes, and I believe that the number is increasing—calculate pension by length of service multiplied by final salary. It is obvious from the arithmetic that it is better that all the pensions should be calculated from the final employment than that one should draw a group of pensions which cannot, in the nature of things, give such a favourable result.
I think, also, that the concept of full transferability is implicit in the State graduated pension scheme, which was introduced by my right hon. Friend the Member for Kingston-upon-Thames (Mr. Boyd-Carpenter); and the public are now used to it. Therefore, we should make clear that transferability is our objective and that preservation is a very second-class object. It is only a residual object in cases where full transferability is not possible.
There will always be cases where transferability is not practicable or, for one reason or another, not really desirable for the beneficiary. I recommend that beneficiaries should then have the option to take a lump sum and invest it with an approved fund, in much the same way as a self-employed person can do. I have considered the option to take a lump sum in part exchange for pension rights and I think that it should be extended to cover all types of scheme. At present, it is preponderantly in the public sector that that option is available and it is considered an extremely valuable one by members of the Civil Service. If it was also available in private sector

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schemes, it would remove the anomaly which prevents free movement between the public sector and the private sector, to the great benefit of both and particularly of the employee.
I have also considered the arguments for withdrawing the facility which allows employees to take a refund of their contributions when they change jobs. I consider that this should continue. In this, I realise that I am flatly at variance with the Morgan Report, but it is extremely hard to tell people who have put money, sometimes voluntarily, into pension schemes that it is no longer their own but belongs to the trustees of the scheme. Indeed, I would go further and extend the facility to take out a part of the accrued pension right on change of employment to those in the so-called non-contributory schemes, at least as to one-quarter or one-third of the value which has accrued for them.
We are not trying to maximise pensions. Our object is to protect the rights of the individual and to encourage mobility of labour. I think it reasonable, however, if the option of the employee to take back his own contributions is retained, that the rate of tax which is charged on such refunds should be reviewed, because an entirely artificial formula is used and it no longer seems to be realistic.
I have three further specific recommendations to make. First, I think that the restrictions should be withdrawn on the amount of pension which the final employer may give where there is a possibility of only 10 or under 20 years of service. This question of the uplifted sixtieths takes us into the most fantastic realm of bureaucracy. The sooner that the injustice which goes with the opera-of that concept is swept away, the better it will be.
I think that the upper limit of £3,000, which has been imposed on some type of pension whether a higher figure been earned or not, should also be withdrawn.
Lastly, I recommend that full tax benefits should be given for short-service schemes which envisage the possibility of early retirement or redundancy on the Army pattern. This
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is not the occasion to explain in greater detail why I foresee that schemes of this kind will become increasingly necessary, but they should have a real and permanent place in some types of occupation. If we are contemplating a radical revision of the rules affecting occupational pension funds, we should take account of the fact that there will be an increasing need for pensions in industry and business to be calculated in the same way as they are for the Armed Forces.
The House has been extremely indulgent with me and I would like to conclude by saying only this. It has been suggested lately that nothing could be done to protect pension rights in occupational schemes until the Government have brought in their new graduated State scheme, but unless the Government intend to wipe out occupational schemes altogether, which seems to me to be inconceivable, the law which governs them will still need to be changed.
I can see no excuse for delay. Millions of people are affected by this matter. I hope that as a result of this debate something will be done, and done at once Where there is a will, there is a way.
4.6 p.m.
Mr. F. J. BellengerI congratulate the hon. Member for Kensington, South (Sir B. Rhys Williams) on the cogency of his speech and also for another reason. He happens to be the Member for the constituency in which I reside. I may say, to put at rest the minds of some who may look askance at the hon. Member's appearance here, that I had nothing to do with his arrival. Nevertheless, he is my Member of Parliament and he has today acquitted himself as well as, if not much better than, many maiden speakers whom I have heard in my long association with the House of Commons.
I hope that the House will agree with the hon. Member in the Motion which he has moved, and for this reason. I do not see how we can avoid doing so. It is written into the terms of the House of Commons Members' contributory fund, of which I am a trustee, that hon. Members coming into the House from other professions have the right, if they so wish, to transfer their pension rights to the House of Commons fund. There is, therefore, a very good reason why we

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should agree with the hon. Member in the Motion which he has so ably moved.
I do not know what statutory action will need to be taken and whether the Government should initiate legislation to do what the hon. Member wants. He has rather suggested that they could do so as soon as they introduce other proposals linking in another way the pension rights of the mass of workers. When my hon. Friend the Joint Parliamentary Secretary to the Ministry of Labour replies to the debate, he should certainly tell us that the Government are willing, as the hon. Member for Kensington, South has urged, urgently to do something about this matter. We have done it in several cases of hon. Members who are now in the House and who have come from industry at large. Why should we not do it for the mass of workers, as the hon. Member suggests?
Quite often nowadays pension rights are part of the terms and conditions of employment on which executives and others are engaged. We should not, merely because they change their mode of employment, seek to deprive them of the rights which are theirs and which they took up when they sought to engage themselves with their employers. Quite often, of course, many of these pensions are based on private insurance schemes throughout the country. I do not think that there would be any great difficulty in getting the private insurance companies to agree to a provision of this nature.
I do not want to speak at length on the hon. Gentleman's Motion. I rose merely to congratulate him on his maiden speech, and also to support the proposition which he has put before us so well. Therefore, I shall now resume my seat, merely adding that it would be a shame if we denied to others the opportunity which we as Members of Parliament reserve to ourselves in our own pension scheme.
4.11 p.m.
Mr. Michael English: I should like to join my right hon. Friend the Member for Bassetlaw (Mr. Bellenger) in congratulating the hon. Member for Kensington, South (Sir B. Rhys Williams) not only upon his speech but upon his choice of topic.
I have very briefly discussed with the hon. Member an interest which we have in common, namely, an endeavour,
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shared, I think, by a number of hon. Members on both sides of the House, to try to introduce efficiency into the industrial scene, and I think that the hon. Member for Kensington, South has a great deal of knowledge and experience to contribute on this sort of topic. Consequently, I was extremely pleased to see it was raised today.
But I am not wholly pleased that it was not raised by the Government. I sincerely hope, as the two Members who have spoken so far have said, that the Government will not forget that, in the election programme which hon. Members on this side fought the election upon, there was a specific commitment upon this issue; because we have not forgotten it.
I sincerely hope, therefore, that we shall hear from the Government Front Bench today not necessarily precisely the proposals that the Government would wish to make, but when we are to know what proposals they have to make in this field. It is very useful that we should be able in this debate to say what we think the proposals might include.
I listened with great interest to the eight points, as I think there were, which the hon. Member for Kensington, South made. I will be quite frank and say that some of them I do not understand, but I think that some of them are also not fully known to some persons administering pension funds. I first and foremost agree with the hon. Member that there ought to be a registrar. That is of vital importance.
I have actually had complaints from employees of one large and very well-known public company on the particular form of alterations to the company's scheme, but really there is no obligation on any company to have any particular form of pension scheme other than one which complies with the Inland Revenue's taxation rules. If it does that then almost anything else goes. I think that that can be thus very roughly described as the situation.
This is very relevant to the second question of whether a fund is or should be regarded as the property of the beneficiaries or not. That was the second point raised by the hon. Member for Kensington, South. In this context, I am not quite sure whether I agree with him about employees taking out their

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contributions; that the existing practice is something one would wish to continue if pension schemes were transferable.
I think that I would personally be inclined to agree with the Morgan recommendation on that, rather than with the hon. Member. Certainly, I would not like to see refunds continuing with certain pension schemes, because I am sure that the hon. Member and others will be aware that a refund of contributions paid in at a given date or series of dates and taken out, say, 20 years later when the cost of living has risen, as will the value of the pension scheme because of capital gains, means that this is where practically the beneficiary loses rather than gains. Often, also, the rate of interest on employees' contributions is far below market rates.
If the hon. Member for Kensington, South, means, as I hope he does not, refunds in all cases continuing on the present basis I emphatically disagree with him. I would probably go further and say that if we are to make schemes properly transferable the practice should cease.
The last point I wish to make is this. I think that everyone would agree with the hon. Member that there is no likelihood, whatever the Government do, of there not being still occupational schemes in existence. One could imagine a national scheme which provided for all persons in employment everywhere, but it would still be the case that there would be certain employments where the employers might wish to provide better pensions for particular classes of employees, or there would be cases where, just because an industry is more prosperous, it would wish to provide better pensions than less prosperous industries. One cannot, therefore, imagine a complete cessation of existing occupational schemes. But I do not think one need go quite as far as the hon. Member for Kensington, South and say that one does not necessarily envisage some cessation of occupational schemes.
What I have in mind is that administratively one of the simplest ways of dealing with the problems of transferability would surely be to start with the question of graduated pensions. I do not wholly agree with my own party on this subject.
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I do not think that there should be a top limit of benefits which may be received or a top limit to the salary under which graduated pension contributions are paid. To my mind, for a man earning his living at £10,000 a year there should not be a distinction—except in amount of contribution and benefit—from a man who is earning his living at £1,000 a year.
Presumably, there is justification for what they are paid. Therefore, if one is to have a graduated pension scheme nationally they ought to get benefits based on contributions and based on the earned income they have been earning when in employment. I mean genuine employment, of course. I am not talking of the one-man business where someone pays himself a salary because it is then earned income rather than unearned income for tax purposes.
Having done that, this can only be, as it were, a basic minimum. It may be that one would wish to extinguish occupational schemes which are less good than that or occupational schemes to the extent that they are the same. In other words, one could say to each company that it will have to contribute on a massive scale to our national pension scheme but it might extinguish its contributions to its existing occupational scheme to a certain extent or possibly in total.
This would extinguish some of the less good occupational schemes, but I do not think there would be any loss, nor do I think that anyone would suffer. Neither the beneficiaries nor the firm would suffer, and administratively a great deal of time and clerical effort on running a lot of rather poor pension schemes would be saved. One might consider this because it reduces the problem of transferability amongst the ones that remain.
With regard to them, for heaven's sake let us trying something less complicated than actually exists amongst local authorities and nationalised industries. The existing basis of transferability, where it does exist, amongst certain professions, such as teaching, the local authorities, nationalised industries and the hospital services, should not, it seems to me, be copied. There we have the worst of both worlds. Every pension scheme is regarded as a separate entity, whereas I would have

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thought, for example, it would be just as easy for the pension schemes of all local authorities to be regarded as one scheme. Each person who leaves and each person who arrives is treated as a separate case.
There are vast formulae, and masses of legislation explaining how to work out the formulae in order to determine the precise rights which can be taken from one authority or organisation to another. This results in a mass of clerical and administrative labour in order to deal with each detailed individual case. I would have thought that it could all be done a great deal more simply.
What I have in mind is that one could transfer the amount of the accrued contributions out of one scheme into the second scheme, where it would be used, in the second scheme, as if it represented the amount of contribution into that scheme by a person who had been employed there. This would seem to be a perfectly simple basis.
The principal type of organisation that would then suffer is one which is declining in numbers—I will not go into the question of age composition, but the same broad principle applies. The obvious case, not necessarily the only one, of an organisation which would suffer under such a scheme would be the organisation which was declining in numbers, because pension rights would continually be taken out and no new rights would be brought into the scheme.
I am not an actuary, I am not sure whether this makes a practical difference. If the scheme is extinguishing itself, it may make no difference at all. It does not seem to be beyond the wit of man to devise precautions against any effects of that kind which may flow from my suggested principle. Normally, the simpler method, although it might not be strictly accurate in terms of money, would probably justify itself in terms of administrative savings. An analogy, although it is not an exact one, is with the redundancy payments scheme, whereby the Government pay contributions which would otherwise be provided from other sources.
We should endeavour to make transferability of pensions work. I agree with all that the hon. Member for Kensington, South has said on the desirability of transferability of pensions, as do the overwhelming majority of hon.
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Members on this side of the House. I hope that we shall first get some information from Her Majesty's Government on when they are to produce proposals, and that those proposals will be so designed as to have the maximum effect with the minimum clerical and administrative effort.
4.24 p.m.
Mr. Tim Fortescue: I am most grateful to you, Mr. Speaker, for giving me the pleasure and privilege of being the first Member on this side of the House to congratulate my hon. Friend the Member for Kensington, South (Sir B. Rhys Williams). I do this with the greatest sincerity. We on this side all know my hon. Friend's great expertise in social and pension matters, and we were delighted that he should choose such a difficult subject and argue it with such cogency from his very great knowledge. We hope very much that we shall hear him many times.
Having said that, I should like to take up a point raised by the right hon. Gentleman the Member for Bassetlaw (Mr. Bellenger) who, in his speech, said that we in the House of Commons reserved to ourselves the right in our own pension scheme to transfer our pension rights from previous employment when we come into the House. This is written into our scheme, and when I came into the House about two years ago I was delighted to read that it was possible.
I promptly sat down and wrote a letter to my previous employers informing them that they had to transfer my pension rights in their scheme to the House of Commons scheme. I received an extremely dusty answer very quickly from the trustees of their pension scheme saying that, whatever the House of Commons scheme might say, they were not at all interested, and intended to retain their contribution to my pension in their fund and do nothing about it. In case the right hon. Member's words arouse hopes in the breasts of future Members of the House that it is obligatory upon their present employer to transfer their pension rights, I very much regret that I have to disillusion them; this is not so.
The hon. Member for Nottingham, West (Mr. English) advised us what might be done to attain simplicity, and I agree with much of what he said. Until recently I have been living in

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Switzerland, where the Swiss, with their great enthusiasm for standardisation and simplicity, have tried to simplify this matter. In doing so they have made a far worse mess of it than anyone would have imagined possible. In certain cantons of Switzerland they have standardised all pension schemes, so that when one moves from one job to another one takes out of one's first pension scheme one's own contribution. This contribution is paid into the new pension scheme, and one's new employer must match those contributions from his own resources, whereas the former employer retains the contributions he has made twards the pension of the man who has left.
One would have thought that the result of this would have been obvious, but it apparently was not obvious to the Swiss. The result is that in Switzerland it is practically impossible to change one's employment after the age of about 40. One has to be very valuable indeed to persuade an employer, especially a Swiss employer, that one is worth to him not only the salary he will pay, but also the accrued pension rights which may have been earned in many years of employment with a previous employer. I hope that the Parliamentary Secretary who was listening to the very wise words of the hon. Member for Nottingham, West will not be lured down the path towards simplicity which has been followed so disastrously by our friends in Switzerland.
4.28 p.m.
Mr. Sydney Bidwell: May I join in the congratulations to the hon. Member for Kensington, South (Sir B. Rhys Williams) in what I understand is his maiden speech. I was not fortunate enough to hear the beginning of his speech, but I did hear most of it and, as my right hon. Friend the Member for Bassetlaw (Mr. Bellenger) has said, it was most cogently expressed. Of course, one's maiden speech is a most nerve-racking experience, but, as I can tell my hon. Friend from my shortish experience in the House, so is one's fourth, fifth and sixth speech in the Chamber.
One does not normally associate revolutionary propositions with Kensington, South. I expect that the hon. Member is very well aware that to get legislation to
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achieve complete transferability rights of all pensions and superannuation schemes in the land would be a most forward step, and a most revolutionary one. It is one which is quite consistent with the spirit and the ideas of many hon. Members on this side of the House. It is quite consistent with the policy of the Trades Union Congress. However, I doubt very much if it is quite consistent with Confederation of British Industry policy. Nevertheless, that is no reason why the hon. Gentleman should not bring this proposition before the House.
My main reason for wishing to join in this debate is that I have put down several Questions along these lines seeking this forward step. Having regard to the principal reason for the hon. Gentleman's desire to support this proposal, in that it should lead to a greater mobility of labour, clearly it is a long overdue step.
For many years, we in the Labour Party have subscribed to the idea that we should have a national superannuation scheme applicable mainly to those who at present are shut out of what I would call any decent kind of occupational pension scheme. That applies to the vast majority of our workers. What I call decent superannuation schemes are applicable to a very small minority of employees at present.
I want the hon. Gentleman to understand, however, if he has not done so already, that his proposal would be a considerable challenge. Under present systems, the fact that one loses the employer's side of the pension contributions is a tremendous deterrent to changing employment, particularly when one reaches the forties and fifties. As the hon. Gentleman said, there are many such people who feel that they are glued to their present jobs and who would be much better off, not only from their own point of view but from that of the nation, if they changed their employment. Frequently, one hears of a man being deterred from taking on promotion in another kind of employment for which he is more suitable.
In the event of this idea coming about, I suggest that there would be a considerable movement of people out of the Civil Service. Many people were put there by their parents and rue the day when it happened. They would much prefer to be in other jobs and, therefore, it is only

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fair and reasonable, accepting the idea of the freedom of the individual, that people should have these rights.
However, many employers would resist it, because their pet schemes are means to keep people in their employment. If they are particularly valuable or skilled employees, that is what they would wish to do. In a sense, although we are no longer living under the old crude conditions of capitalist masters and where working people have acquired enormous rights, as a result mainly of the efforts of hon. Members on this side during the course of the century, there is still a kind of master-slave relationship between employer and employee. I welcome this attempt to sever some of the chains which bind workers to their employers. As a result, I have nothing but the greatest amount of warmth towards the proposition of the hon. Member for Kensington, South.
Another reason for my wishing to take part in the debate is that I have had representations from constituents on this very matter. They are women workers, and they contend that there is discrimination against women in their employment. The men have certain transferability rights, but the women do not, and they have asked me when it will be possible for us to put through legislation in this House which will give them a fair crack of the whip. I am glad, therefore, that this proposal comes before us today.
As the hon. Gentleman has said, we have the graduated pension scheme, which many of us have dubbed the graduated pension swindle because of the poor benefits that it pays in relation to what is paid in. The hon. Gentleman's proposition means that, if one is changing one's employment and it is a contracted-in situation, the full rights are restored to both the employer and the employee elements of the contributions made. There is an enormous difficulty in the application of it, but I hope that the Government will not fight shy of it, because the prospects of getting our longer-term idea of a national superannuation scheme are much more distant than we thought might be the case when my right hon. Friend the Lord President of the Council put it before the Labour Party conference 10 years or so ago.
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It would be wrong to think that because we want this major overhaul of the social services and this concept of a national superannuation scheme under the aegis of the State, we should hold back in this very necessary elementary reform of establishing a system of full transferability of rights as they apply to present pension and superannuation schemes, whether they be handsome ones applicable to salaried staffs or the lesser ones applicable to wages staffs.
4.36 p.m.
Mr. Cyril Bence: I apologise to the hon. Member for Kensington, South (Sir B. Rhys Williams) for not having been present when he made his maiden speech, but I assure him that I will read it, because I am deeply interested in the subject.
The reason for my interest is that I am worried about the extent to which we can continue piling on to large groups of insurance companies, large industrial complexes and even small ones a burden which moves further away from their commercial responsibility towards a social one.
I used to work for a large industrial complex in a category where I was able to join a very good superannuation scheme. I happened to be in an industry which was a very progressive and remunerative one, producing high profits. It was an expanding industry, even between the wars. We had pensions schemes which, in the context of many other industries, were top hat ones even for those in the lower grades.
In industry generally, much depends on the ratio between capital and manpower employed; in other words, the manpower intensity and the capital intensity. Depending on those two factors, private schemes vary in the benefits that they can grant for given contributions to those subscribing to their superannuation schemes. In an economy such as ours, it is quite impracticable to make matters really watertight and give complete transferability of pension rights to everyone.
In his Motion, the hon. Gentleman says that such rights should be retained in every practicable case. However, there will not be many practicable cases when it comes to dealing with insurance companies and the pension schemes of

819
different industries. For example, I cannot see the mining industry or the shipbuilding industry being able to evolve with their insurance companies superannuation schemes which are equal to some of those in industries where capital intensity is high, manpower intensity is low and the product very profitable. I can see transferability of pensions as between groups of workers in different industries made possible only through the State, perhaps in conjunction with the insurance companies, with the matter being treated as a social matter and taken away from the responsibility of commercial enterprise.
My hon. Friend the Joint Parliamentary Secretary will probably argue that units of industry on the Continent bear a higher burden in various social security and pensions schemes, with higher percentages borne by and costed on to industries than is the case in this country. I believe that in a large trading nation like this, with a high density of population and a need for highly competitive industry, it is far better for the State and the general body of taxpayers to provide for a general level of superannuation based on the function one performs in industry.
I have changed my employment sources three times in my lifetime. In no case was I allowed to transfer my pension. When I came here it was out of the question. The insurance company that handled the group insurance for the company by which I was employed would not entertain it at all. Whether it thought the expectation of life in my previous job was better than in this I do not know. I know some enterprises—I will not mention them because it would not be fair—where the incidence of accident and even of health statistics are lower than in other industries and transferability becomes difficult.
I accept the proposititon of my hon. Friend the Member for Southall (Mr. Bidwell) about holding labour. This is a very difficult matter indeed. Let us take the case of a man, 45 years of age, married and with children going to the local grammar school, a good and highly skilled employee in industry and whose manager or foreman is a man with whom he has grown up, so to speak, over the years. Often people like him are inhibited from changing their occupation for very
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human reasons. The people who run industry today are not the hard-faced men of the 19th century. Often they are compassionate and very generous. There is a good type of man running industry today. One has only to work for the Americans for six months to discover the difference in attitude between British and American managerial executives. Often a man is inhibited from changing his labour because, by so doing, he will lose pension rights that have perhaps been built up over 25 years. On this aspect, I welcome the Motion.
Switzerland has been mentioned, so there is no need for me to quote the absurd situation there. I hope that no one in this House suggests that we should undertake the Swiss concept of transferability of pension rights. I cannot see it happening here. It would lead to chaos. Therefore, I hope that any idea of building up a universal comprehensive insurance system will be done through the Ministry of Social Security rather than leaving it to industry. This is not because the top people in industry are vicious or are slave-drivers, or want to make massive profits out of their contributions, but because of the different aspects and profitability of industry.
Some of the things that are least socially desirable are often the most profitable. One can often make a fortune by making a small contribution to the general well-being of the society in which one lives. On the other hand, one can make a large contribution and die a pauper. This is the story of social contributions throughout the ages. No one complains, because often the man who makes a fortune has hated the work that he has been doing. It has probably been difficult and trying and he may get ulcers. But the other fellow who enjoys his work is venerated and lives to a ripe old age, which is his reward. That is a phenomenon of the social history of this and other countries.
I hope that this Motion highlights the problem and will urge the Government to get ahead with preparing some social security scheme which will give us a universal superannuation retirement pension on top of the basic State pension based on the contributions of the State, the employer and the employee in all our industries. By so doing we remove the

821
basic responsibility from individual industrial units and enable not only those at top and medium level, but workers at the lowest level to move between industries where perhaps their labour is more urgently desired.
4.45 p.m.
Sir Douglas Glover: I apologise to my hon. Friend the Member for Kensington, South (Sir B. Rhys Williams) for missing his maiden speech. I know that he is an expert on transferability of pensions. I would have liked to have listened to his speech. Unfortunately, as he will find the longer he stays in the House, hon. Members sometimes have to attend other meetings and cannot be here when they wish. He will understand that there is nothing derogatory in making his maiden speech when a lot of his hon. Friends were not present to hear it.
The hon. Member for Dunbartonshire, East (Mr. Bence) made a valuable contribution to the debate. Like him, I will take great pleasure in reading my hon. Friend's speech, which I am sure was first-class. Knowing this House, I am sure that he feels a great load off his shoulders now that he has broken the ice and dived in at the deep end.
There is a great deal in what the hon. Member for Dunbartonshire, East has said about transferability of pensions. I support the views of my hon. Friend the Member for Kensington, South. It would be ideal and desirable to get transferability if it is feasible. I am governed by the fact that the insurance companies would have a greatly increased turnover if they had introduced transferability. There must be some pungent and powerful reason, therefore, why, in fact, they have not, despite the difficulties involved in so doing. It would he to their advantage if everyone in employment was insured for a pension over and above his State pension and, on changing his employment, could take his pension with him.
I should like to see a person changing his employment taking his pension with him. One difficulty is that the pension rights of an individual are, from a firm's point of view, not only created to provide an advantage to the employee, but are an insurance policy to keep the employee on the firm's payroll. The firm is not very interested if a chap can say, "I am leaving your employment", and
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can take his pension rights with him. If he is allowed to do that it is more likely that he will leave. Therefore, we have to face the fact that, concerning private insurance policies, if a man leaves firm A to go to firm B he will lose his pension rights.
This is, I think legitimately, one of the sanctions against a man leaving, because a firm can say, "This man has worked for us for 20 years. It is not likely that he will leave, because, if he does, he will lose his pension rights." There is an inbuilt insurance, from the firm's point of view, that he will stay in his employment.
Another pertinent point is the difficulty that one organisation with a vast turnover on a very small amount of profit may find difficulty in providing the same pension rights as another organisation where capital intensity, compared with the number of people employed, is very small. It is, therefore, able to provide much better pension rights than the vast extractive industries. I apologise to my hon. Friend the Member for Kensington, South, because he may have been able to solve this argument, but there is a real difficulty in levelling out pensions, as it were, between the capital intensive industry and the industry where there is a vast amount of manpower. It is easy for I.C.I. to provide generous pensions in its capital intensive employment with comparatively few employed considering the profits involved. On the other hand, other industries which are not making such a profit would find it difficult to give I.C.I.-type pension rights if there were compulsory transferability.
First, we should try to get voluntary transferability on a much wider scale than obtains at present. I cannot see how the State can enter into interference in private arrangements between employee and employer, making this compulsory, because the State has no idea what sort of employment a person may be going to if he leaves the place where his present pension was negotiated. He may be going into some form of society where at present there is no pension right at all. He may foolishly go into a betting shop and earn twice as much money as before, but find that there is no machinery at the moment for a graduated pension scheme in his new occupation. It would be difficult for the State at this time to produce legislation

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that would make for compulsory transferability.
We on this side of the House should encourage a voluntary transferability system and, if possible by taxation, provide incentive for insurance companies to extend transferability to cover the maximum number of people. I am suspicious of all the well-meaning ideas which involve the State doing something else. Invariably, I discover after about five years that the State has taken compulsory powers and the voluntary system has disappeared. Then the party opposite says that it would be a good idea to take the whole thing over for the State and we get more inefficiency, lack of choice, and loss of freedom of action. I therefore view all these things with a great deal of doubt and worry.
Perhaps my hon. Friend and I can discuss this matter outside the Chamber, for he may have solved these problems. I apologise again for not hearing his speech. I think that there is an enormous amount of difficulty in this field, but my hon. Friend has done a very valuable thing by using the procedure of a Private Member's Motion so that the House can discuss this subject.
4.54 p.m.
Mr. Albert Booth: I am grateful for the opportunity for this debate which has been afforded by the hon. Member for Kensington, South (Sir B. Rhys Williams), because it gives us a long-needed chance to consider a serious and developing problem. We may have differences among ourselves as to the solution, or even as to whether there is a solution in the legislative sense, but I think that we are all at one in agreeing that there is a problem which is worth our considering.
The first aspect I turn to is the adverse effect of lack of transferability on trade unionists and trade organisations. It has been the experience of a number of staff trade unions in particular that the older member who has made many years' contributions to a staff employment fund is understandably reluctant to paricipate as actively and militantly in certain campaigns as the younger member with no investment, or very little, in the superannuation fund.
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This is understandable in terms of the attitude of a man with many years of contributions to a superannuation fund. He considers, among other things, the prospect of losing his superannuation in the event of his being involved in certain forms of industrial conflict. It is understandable, also, in the light of the sense which is borne in upon him of the superannuation arrangement being a question of an individual contract between him and the firm conditional on his remaining with that firm, which is precisely what these funds are at the moment.
This leads us to consider the desirability of understanding the nature of the contract and whether we as a House of Commons want to ensure that it is a contract which embraces not only the individual and his employer, but the State in so far as the State has a concern for the maintenance of a man or his family during retirement. More particularly, has this been a problem in sectors of the engineering industry where employers—unwisely in my opinion—have insisted that certain employees should be entitled to participate in certain superannuation funds only if they are members of the Foremen and Staff Mutual Benefit Society.
By doing so many drawing offices and other staff employment establishments have been cleft between those who have stood by their union as they saw it and established the fundamental right to maintain trade unionism within staff employment, and those who have considered it more desirable to assist the right to participate in a superannuation scheme than to become members of the Foremen and Staff Mutual Benefit Sociey and have thus been deprived of their right to join a union.
I hold, along, I think, with every Labour Member in this House, that the right to be a member of a union is fundamental and cannot be made conditional on forfeiting a right to participate in a superannuation fund. Until such time as this requirement is driven out totally from industry, I shall always hold the view that we must ensure that transferability is a right and that pension fund membership cannot be made conditional in any way which will cause a man to forfeit his right to be a member union.

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Another aspect which possibly may be nearer to hon. Members is the effect on civil servants. It seems that the rather special position of civil servants vis-à-vis superannuation is one which might be detrimental to the country. I estimate, and put it no higher, that many in the Civil Service today would not be there but for the fact that leaving the Service would cause them to lose a good pension right. At a time when the political problems we face are becoming more technical with increasing complexity and require more and more understanding by those who practice as officers for Government, what is going on inside industry and other aspects of civilian life makes desirable a greater degree of movement between the Civil Service and industry.
In so far as our present mode of superannuation and its conditions act as a barrier to this, they act as a barrier to a necessary improvement in the transfer of ideas and cross-fertilisation of the best factors of industry and the Civil Service. I do not hold the view that the Civil Service would be the only beneficiary of this movement. Just as some of the best ideas of industry could usefully be introduced into the Civil Service, so some of the best practices of the Civil Service could usefully be transferred into private industry.
It seems to me that the attitude of firms to the question whether they can transfer a pension depends very much on the desirability or otherwise of obtaining or releasing employees. Much speaking is done on the subject with tongue in cheek. I have heard it said that in no circumstances is it possible to transfer the pension of a man who wishes to leave. On the other hand, I have seen a man transferred into an engineering firm at an age over 60 because it was thought desirable to have him working in that firm.
The problem can be overcome. I claim no expertise in insurance or actuarial matters, but I am certain that a qualified actuary could easily work out the value of the contributions made to one pension fund as transferred to another. It is not an insoluble problem. What is lacking is the will to make such transfers possible.
The fundamental reason for legislation in this respect is to be found in the basic reason for having a superannuation fund at all. It is that employees, either of State or of private firms, wish during
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their working lives to make some financial provision for themselves and their dependants in retirement. If we continue as at present, hunderds of thousands of our fellow citizens, by the very nature of the contract into which they enter, will be able to make that provision only if they tie themselves to a firm or to an industry. That is totally unreasonable. It would be unreasonable at any time, but it is particularly so in the latter part of the 20th century, when we want people to move their occupations and when it is desirable for them to learn new skills and to take up new occupations, because they must be prepared to move into different parts of profession and industrial life.
I hope that the Minister will give an undertaking that the Government are prepared to introduce legislation to bring about the transferability of pensions.
5.3 p.m.
Mr. Kenneth Lewis: May I congratulate my hon. Friend the Member for Kensington, South (Sir B. Rhys Williams), first, on his good fortune in drawing a place in the Ballot and, secondly, on selecting this subject for debate. I was eight years in the House before I was fortunate in the Ballot, and on that occasion I drew No. 2 I listened to his speech with a great deal of interest. It was a very practical contribution, and I hope that the Government will take note of it.
This subject has been considered over a number of years by Minister of Labour of both the Conservative and Labour Parties. About 1963 the Conservative Central Office produced a publication, in compiling which a number of my hon. Friends and I took evidence from both trade unions and employers, and this was one of the subjects which we discussed.
We came out in favour of the transferability of pensions. Despite all the practical difficulties, we were certain that this was an essential step towards securing mobility of labour and the transfer of expertise from one industry to another, and, in particular from declining industries to industries which were growing and developing.
We met a good deal of opposition from both sides of industry, although

827
it was probably strongest from the employers. They have a particular interest in holding on to people—and one means by which they do so is to offer their employees a pension. Governments are partly to blame. Taxation is so high on all employees, and particularly on those at the highest level, that the only way in which an employer can provide an incentive is to compete on pensions. Once he has done that, he tends to take the view that it is an opportunity to keep the employee working within his own organisation. That is a restrictive practice—and a restrictive practice which we ought to get rid of as soon as possible.
But the Government must give a lead, and up to now they have failed to do so. Recently I had a case in my constituency in which a man employed by the General Post Office wanted to transfer to a job for which he had applied in the normal way with the Ministry of Public Building and Works. He was offered the job but then found that it was impossible for him to maintain his pension rights if he moved. He therefore had to turn down the job.
I took up the matter with the Postmaster-General, who wrote to me and said that this was, in fact, the case. He said that he was very sorry about it but that the Post Office needed the skill of that man and could not afford to make arrangements to transfer his pension because that would mean that they would have to let him go. If that happens between one Government Department and another, and if it happens between nationalised industries, how can we hope to change the mood in private industry? The Government must give a lead. They must make arrangements so that there is transferability of pensions between Government-industry and private-industry and between the Civil Service and the nationalised industries.
Everyone accepts that it is very difficult to change quickly, but we have been looking at the problem for 10 years, this represents snail's progress. I hope that in his reply this afternoon the Minister will not put off a decision by saying that he is awaiting the report. My hon. Friend was correct in his analysis: there is nothing to prevent the Minister, in advance of the report on pension schemes
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which are related to earnings, from taking an advance decision. He could at any rate give a lead within the Government service.
Pensions are a part of earnings—an extension of earnings into retirement, and as such they should be an incentive to the individual rather than a disincentive. They should be a means by which the best use is made of the individual's skill and by which he can move, if he wishes, to extend the use of his talents. At the same time they ought also to be a means by which industry can secure workers and not just a means by which they can hold on to them.
5.8 p.m.
Mr. Stan Newens: This is a very important subject and the House is grateful to the hon. Member for Kensington, South (Sir B. Rhys Williams), who initiated it.
We live in an economy in which change is taking place very rapidly. We live in the midst of an unprecedented spate of take-over bids, mergers and reorganisations of industry of all sorts. The capital value of the firms involved in 1967 was double that of 1966, and we are likely to see even larger firms involved this year. With take-overs and mergers, there is inevitably a drying up of jobs and a number of redundancies. New opportunities arise and opportunities which seemed to exist often disappear.
Few men in industry now can be sure that they will be doing in 10 years the same job as they are doing today. This applies not merely where there are takeovers or mergers; it applies, also, where people remain with the same employer. If a man discovers that his job is drying up, or is likely to do so, he may well wish to go over to another firm. In such circumstances, it is vital to have transferability of pension rights so that men are able to change to new jobs as opportunity presents or as necessity arises. It is wrong that men should be prevented from moving around, when everything else favours such action, purely because they would lose certain pension rights.
As the hon. Member for Rutland and Stamford (Mr. Kenneth Lewis) said, employers have used pension rights as a means of holding labour. We can no longer afford that state of affairs to continue. Recently, a scheme was introduced

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so that teachers who entered the House of Commons could have their pension rights transferred to the Members' scheme. If that is good enough for teachers, like myself, who enter the House of Commons, it is good enough for all other workers.
A good many people are late developers; when they have reached a certain stage in life they find that they would like to train for other jobs. If they cannot take with them pension rights which they have accumulated, their aspirations will be damped down, and the general state of affairs will be far more stagnant than is desirable.
This is not an academic matter or one affecting only a few. At this time, with take-over bids and mergers very much in the air, I have received a good many letters from constituents raising this very problem with me. In Harlow, part of the Epping constituency which I represent in the House, a large establishment was affected recently by the take-over of A.E.I. by G.E.C., and we have, in addition, had several other factories affected by redundancies on a smaller scale. Each of these events brought letters to me, as the Member of Parliament, asking about transferability of pensions and what rights ordinary individuals, who have worked with a firm for years, may have if they go to other organisations.
Like the hon. Member for Rutland and Stamford, I have taken up several such cases, and I have been struck by the utter stupidity of the arrangements at present prevailing which prevent people from moving around although it would be to everyone's advantage that they should.
I am delighted by any improvement which takes place. I regard as an advance piecemeal schemes arranged for interchangeability between particular private schemes, but I am certain that a general State scheme is required. We must have legislation if the problem is to be tackled properly. We cannot afford to leave the question of transferability to the chance benevolence of a particular employer or to the luck of the game in certain occupations. There will be many anomalies left unless the Minister is able to undertake today, or fairly soon hereafter, to introduce legislation to make the whole system uniform.
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I urge my hon. Friend, therefore, to regard this as a matter of priority. I recognise that to introduce transferability of pensions will be no simple business. It entails enormous complications and difficulties, but, none the less, the job cannot be put off. Many people will continue to lose their rights to pension so long as the present situation is allowed to continue, and those who have lost their pension rights cannot have them restored retrospectively. Moreover, many people will take decisions about their future employment different from those which they would take if they were assured of being able to transfer their pension rights.
I urge my hon. Friend, therefore, not to regard this as a trivial matter. It affects a great many people, and, now that mergers and takeovers are taking place so frequently, it will affect a great many more. Urgent action is called for. We must have legislation laying down a scheme which will apply universally throughout industry and throughout other sectors of the economy. I hope to hear from my hon. Friend an assurance that the Government regard the matter as urgent and a promise that, at the earliest possible moment, action will be taken to remedy the present state of affairs.
5.17 p.m.
Mr. Peter Tapsell: I am glad to have this opportunity from the Front Bench to join with other hon. Members who have spoken in congratulating my hon. Friend the Member for Kensington, South (Sir B. Rhys Williams) on a really excellent maiden speech. He spoke with closely reasoned logic and knowledge and deep seriousness on a subject which, I know, has long been dear to his heart and on which he is a considerable authority. The whole House listened to what he had to say with the greatest interest, and we look forward to hearing him contribute to our debates on many future occasions.
In considering pensions for the retired, we all share the same aim, to ensure that as many people as possible have a sufficient income in their old age to maintain a decent standard of living and one not too far removed from that to which they were accustomed during their working lives. Among those already retired, the main source of income of the great

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majority of our fellow countrymen is still the State pension. But the great change in recent years has been the growth in the number of people earning an eventual entitlement to a pension through membership of an occupational pension scheme.
As my hon. Friend the Member for Kensington, South said, over 12 million people, about half the working population—in fact, it is two-thirds of the male working population, I think—are now gaining such private pension entitlements. This is an extremely valuable development. Not only does it help to solve the problem of poverty in old age, one of the most serious of our social problems, but it generates—hon. Members opposite sometimes overlook this—the private savings necessary to finance the future industrial expansion on which all our social services and the prosperity of the entire country depend.
In considering the subjects of the preservation or transferability of pension rights, desirable as these are, as everybody who has contributed to the debate has agreed, our starting point must surely be to do nothing in the process of securing those objects which will check either the growth of these private occupational pension schemes or the flow of private savings they produce. Every Chancellor of the Exchequer, whatever his party, will agree on that. Whether an employer sets up a pension fund is, to a very large extent, a matter of his own free choice. If we make it too unattractive for him to set up an occupational pension fund, he will not do so.
Some hon. Members have spoken as if every employer would automatically set up one of these funds. That is far from the case. We want to maintain the present climate in which every encouragement is given to good employers to set up new funds so that eventually virtually the entire working population will be entitled on retirement both to their State pension and their occupational pension.
Preservation and transferability are quite separate propositions. It is important to keep the distinction between them clear. Preservation means that when an employee leaves a job the contributions which have been paid into the pension fund by him and his employer remain to
832
his credit in the fund so that when he reaches retirement age he receives the rate of pension to which they give entitlement, even though he may have left that firm many years before.
Transferability, on the other hand, means that the contributions which have been paid into the fund, together, presumably, with any interest they have earned and the capital gains in which they may have shared, are switched to the pension fund of the firm to which the employee is moving. There is an actual physical transfer of assets in the latter case from one fund to another.
Both preservation and transferability raise considerable practical problems, but they are different problems. I could not agree with the hon. Member for Southall (Mr. Bidwell) that this was an elementary reform that we were calling for. The hon. Member for Dunbartonshire, East (Mr. Bence) was much closer to the truth when he said that, though it was a very desirable reform, it was an immensely complicated one. Everyone who does not have to deal with these practical problems is easily tempted to support making either preservation or transferability compulsory, either by statute or by withdrawing tax reliefs from funds which do not provide it, and to think that has automatically disposed of the matter. In fact, that is precisely the point at which the difficulties begin. The hon. Member for Dunbartonshire, East mentioned a number of them.
The Conservative Party, in its 1966 election manifesto pledged itself to
"Ensure that everyone can either transfer or preserve their pension when they change jobs."
The Labour Party, in its manifesto, pledged itself to
"Deal with the problem of transferability of occupational pensions".
That was a nice brisk throw-away line. The Morgan Report, reporting on this subject in the same year—1966—also recommended that preservation should be made compulsory but did not explain in any detail how the practical problems were to be overcome.
The reasons why everyone favours compulsory preservation in principle, and why many favour compulsory transferability, were very well set out by my hon. Friend the Member for Kensington,

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South; and I need not repeat them at any length. The argument for mobility of labour and the argument on behalf of men who think they have got as far in their own organisation as they can hope to go but who might have a very considerable contribution to make in another organisation has only to be stated to gain general acceptance.
Although it is possible to argue about the extent to which the absence of compulsory preservation or transferability impedes mobility of labour, no one can deny that it does impede it, and impede it among particularly important, if relatively small, sections of the community. We should keep the size of the problem in proportion. Very young people when they are starting work usually do not worry too much about their pension rights. I changed jobs three times in the first three years that I went on to the labour market. In doing so, it never occurred to me either to think of the pension rights I was giving up or to inquire about the pension rights that I was about to get. If now, as a member of the management side of a firm, I had to interview a young man in his early twenties, and very early in the conversation he started questioning me about his future pension rights, I would not count that in his favour.
Mr. Bidwell: Does not the hon. Gentleman agree that the matter of pension rights, and even pension considerations, is one of age? Someone of middle age is much more thoughtful about what will happen in old age than is someone just starting work.
Mr. Tapsell: I absolutely agree. That is the point I am trying to make.
It does not apply very much with the young. It does not always impede mobility strongly with the top executives earning very big salaries, because special arrangements with top hat schemes can often be made to meet them. Those who are really affected by this tend to be middle-aged men of middle rank who feel that their promotion is blocked in some big organisation but who also feel, and often rightly feel, that they can make an important contribution in another, perhaps, smaller, organisation. It is because I agree with my hon. Friend the Member for Kensington, South that there are many men of that type who are
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debarred from making the full contribution they could make to our economy that I recognise the great importance of this subject.
In addition to the argument of industrial efficiency, there is also the argument of social justice. Pension rights can fairly be described, as they have been by a number of hon. Members today, as deferred earnings. For most people they represent the largest element of remuneration after the salary itself, and in many cases they represent the largest part of a man's life savings. The accumulated value of pension rights in a good private scheme may be worth the equivalent of 10 year's salary by retiring age. Their existence has probably always been part of the contract of service between employer and employee and, if the scheme is an attractive and generous one, may have been the deciding reason which tipped the scales in persuading the employee to choose that particular firm rather than one of its rivals. I would argue that any society which believes in private property and the encouragement of personal savings should do its best to protect such rights.
One might ask: where there is such general agreement how is it, as my hon. Friend the Member for Rutland and Stamford (Mr. Kenneth Lewis) pointed out, that so little action has been taken over the years? The truth is that the practical problems are, as anyone who has studied the question knows, real and not merely an excuse for inaction. I do not think that I could agree with the hon. Member for Barrow-in-Furness (Mr. Booth) that the problems were merely used as an excuse for inaction and that any competent actuary could quickly overcome them. Having talked to a number of competent actuaries about this subject, I get the impression that this is genuinely a very complex and technical problem.
Mr. Booth: So that there will be complete understanding between us, I want to put it on record that I did not argue that there was not a difficulty about legislating or overcoming the problem of transferability. What I said was not difficult for an actuary to determine was the value of contributions in one pension fund transferred to another. I would like it to be clear that the hon. Gentleman is not arguing against that contention as opposed to the general problem of transferability.
Mr. Tapsell: I see. I am glad to have got that reply from the hon. Gentleman. I do not now wish to become too heavily involved in the technicalities; I am not qualified to do so.
But even on the narrower point that the hon. Gentleman has made, when one bears in mind that some pension funds are not fully funded and the very great variety of investment policies which they may be pursuing—some buying high coupon-fixed interest stocks in order to obtain high income, some buying low yielding equities in order to get growth and some perhaps investing in not easily realisable property as a hedge against inflation—it does not necessarily follow that it is easy to estimate the actuarial value of one man's contributions in the fund and then transfer to another. If one does that and transfers them, one will put funds which are fully funded at a disadvantage compared with funds which are not fully funded. But I do not want to pursue that. It is just one of the many difficult problems that need consideration.
One might be expected, as my hon. Friend the Member for Rutland and Stamford has pointed out, that the Government would set a lead in all this in respect of their own employees before they began to contemplate legislative or tax action to try to improve performance in the private sector. If one counts only the 900,000 civil servants, including the Post Office, the Government are by far the biggest employer of labour in the country. When one includes the whole public sector, about 4 million people are employed, and among that number are some of the most difficult cases, as in the extractive industries mentioned by the hon. Member for Dunbartonshire, East.
The Government never tire of preaching to the private sector about the standards of private enterprise and how they should be improved. The present Government are committed to the principle of transferability in their election manifesto. Yet, in practice, they are still one of the worst of all employers where both preservation and transferability of pension rights are concerned. More than one-third of employees in private sector pension schemes can already take their pension rights with them if they change jobs, but the Government give the same
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right to only one-tenth of their 4 million public sector employees.
As the Institute of Civil Servants has pointed out, the Civil Service superannuation scheme is basically the same today in all important respects as it was when it was introduced under the Superannuation Act, 1859. It is designed for the young entrant who will make the Civil Service his life career. The attitude to the civil servant of successive Governments ever since 1859 has been exactly the same as that castigated by the hon. Member for Epping (Mr. Newens) in the case of private enterprise. The fact is that no good employer, whether private or public, who has a first-class young man whom he is training up to take responsibility will want to lose him. There is nothing in any sense immoral, even if in practice it may be anti-social, in trying to design attractive conditions of work, including pension funds. After all, people are not only held by pension funds. Many large employers provide playing fields and longer holidays for those with a greater length of service and many other fringe benefits to try to hold their employees.
As members of a party which has for many years, rightly, championed the cause of workers, it is hardly open to hon. Members opposite to criticise employers who try to make conditions so attractive that their employees will not leave them. The Government, however, have almost wholly failed to adapt their own occupational pension schemes to meet the requirements of professional staff, nor have they been adapted to meet the needs of a modern society in which mobility of highly trained professionals should be encouraged. If the Parliamentary Secretary can promise nothing else today, I hope that he can at least give an assurance that the Government are giving urgent consideration to methods of bringing their own pension schemes into line with the better private schemes on the questions of both preservation and transferability.
The reason that the Government have given for their failure to fulfil this election pledge, as my hon. Friend the Member for Kensington, South pointed out, as far as the private sector is concerned is that it would be inopportune, as the Parliamentary Secretary said in correspondence, to deal with either preservation or transferability in private pension

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schemes until the new State graduated scheme has been introduced. I find that phrase potentially rather sinister. I hope that I am wrong.
For the reasons I gave in opening, I hope that the Government will operate the contracting out clauses in their new State graduated scheme in such a way that the growth of occupational pension schemes will not be checked. On this point I would completely agree with my successor as the representative of his constituency, the hon. Member for Nottingham, West (Mr. English), who, incidentally, retired me at the tender age of 34. It is not just a question of bringing pension rights into the House of Commons fund; it is a question of whether one can take them out. However, I disagree with him when he says that he wants no top limit to the State graduated scheme. If there were no top limit on the scheme it would be a death blow to private occupational pension schemes.
It is very much in the interests of this country that public and private provision for old age should complement one another. It would be a social and economic tragedy if the State graduated scheme took the form in practice of an assault on the occupational pension schemes and the insurance industry, with which many of them are linked. If it does it will inevitably reduce this country's eventual capacity to provide our old people with the comfortable retirement that we all wish them to enjoy. It will also increase the burden on the decreasing proportion of our population still at work.
The great disadvantage of a Government "pay-as-you-go" scheme is that retirement benefits have to be paid each year out of the workers' current earnings. National Insurance has become in practice a tax on the young to support the old. With inflation, with rising expectations of living among the elderly and an ever-growing number of people living in retirement, the burden on the active sections of the community is bound to grow.
If the greater proportion of the retired people still in the future, as at present, have to look to the State rather than to an occupational pension scheme for their main source of income, there is likely to be a general lowering in the standard of provision for the old below that which
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would otherwise be possible. The overwhelming advantage that occupational pension schemes have over a "pay-as-you-go" State scheme is that they are at least partially funded. They are real savings made today for use in the future. These savings in pension funds already amount to more than £8,000 million.
My hon. Friend the Member for Kensington, South gave us a striking figure; I think he said that they were increasing at the rate of £1,000 million per year. They provide the capital for the new investment in industry which alone can produce the higher production and increased exports which will finance all the social services and support the nonproductive sections of the community with the rising living standards that we want them to have.
I hope, therefore, that in their approach to the real problems of preservation or transferability of pension rights, whether in the context of the new State graduated scheme or under any statutory power which may be taken or in any changes in the law governing tax relief for pension funds, even the present Government may realise that the pension funds are just about the best friends that any Minister of Social Security could ever hope to find.
I hope that we may have an assurance from the Parliamentary Secretary that there will be the closest consultation at all stages with the pension fund managers and the insurance industry as well as with the T.U.C. and the C.B.I. before any decisions are taken. I hope that preservation will become virtually universal, subject to reasonable minimum periods of service, but I think that one must include the word "virtually". For what does one do about the man who, rather than having his pension rights preserved or frozen when he changes job, would prefer to receive a lump sum, perhaps to set up a business of his own, perhaps for a down payment on a house, or perhaps because he plans to emigrate?
This was one point on which I slightly differed from my hon. Friend the Member for Kensington, South. His knowledge of the whole subject is vastly greater than my own, but I felt that he skated rather easily over this problem, because from my study of the subject it seems to me that preservation and widespread payments from the

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pension funds of past contributions as capital sums are in a sense incompatible with one another. This is, I believe, implicitly recognised by Section 379 of the Income Tax Act, 1952, which applies to many of these funds. The "mixed benefit" which would be involved in the suggestion put forward by my hon. Friend is regarded by the Inland Revenue as quite unacceptable.
I see the force of the Treasury opposition to the concept of "mixed benefit", for if a pension accruing in a tax free fund is to be regarded as deferred earnings—and every hon. Member who referred to the subject has so regarded it—and if it is to be treated, as it is, as earned income for tax purposes in the hands of the recipient, how is the lump sum to be regarded if it includes the contributions of the employer as well as the employee? I can see splendid opportunities for tax avoidance there unless there are the most stringent controls.
Nor does the lump sum really meet the real object of the exercise and the reason for the tax relief, which is that successive Governments have thought it right to give specially preferential tax treatment to arrangements which provide a pension for people in their old age. If a vigorous man of 35 takes the pension entitlement he has gained in the previous 15 years as a lump sum, for whatever worthy cause, in all probability it will not provide him with a pension in his old age. Yet, as the experience of most large pension funds has shown, the great majority of middle-aged men on changing jobs opt at present, when they have a choice, not for preservation of their pension rights, but for the return of their contributions.
I hope, therefore, that the Parliamentary Secretary will tell us how he plans to deal with that problem, if he is thinking, as I hope he is, of implementing the recommendations of the Morgan Report on preservation of pension rights. It would prove very unpopular if the right of return of contributions were suddenly and wholly withdrawn.
Transferability as an ideal is even more attractive than preservation. Ideally, all people on changing jobs, however often they change, would take their accumulated pension rights with them and draw their eventual pension from
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the firm for whom they were working when they finally retired. The trouble is that the half of the working population who already have occupational pension rights have them in over 60,000 separate occupational pension schemes. Some of these schemes are fully funded, some partially funded, some unfunded. Some are contributory, some non-contributory. Some provide for retirement at the age of 60, some at 65—and, since the House of Commons Fund has been referred to several times, one must point out that our retiring age is somewhat uncertain. Some contain provision for widows and children, some do not. Some pay a pension related to the final year's salary, some to the total salary earned over a working lifetime. Some are far more generous than others.
It would be an exaggeration to say that no two private occupational pension schemes are identical, but when the Government Actuary published his new survey on occupational pension schemes in 1966 he reported that having looked at 40 small occupational pension schemes he found among them no fewer than 21 different combinations of contributions and pensions—21 different varieties out of 40. With 60,000 to choose from, the minister who makes transferability compulsory will need the help of an actuarial Heinz. Clearly he has one, because Labour's election manifesto contains the unequivocal pledge to "deal with the problem of transferability of occupational pensions".
Assuming that dealing with the problem is not just a euphemism for nationalising the lot, either directly or because of the nature of the graduated State scheme, I shall very much welcome the implementation of that pledge, if a sensible and practicable means can be found which will command the support of pensioners, employers and insurance companies alike. Such a solution, if it exists, would be of very great value to our nation. Failing that, perhaps the Government will return to the more realistic and practical pledge in the Conservative manifesto to "ensure that everyone can either transfer or preserve their pension when they change jobs".
5.46 p.m.
Mr. Peter Archer: I greatly regret that I did not

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have the opportunity of hearing the speech of the hon. Member for Kensington, South (Sir B. Rhys Williams) in introducing the subject. I look forward to reading it in HANSARD tomorrow. The House should be grateful to him for giving us an opportunity of discussing a vitally important question.
I find myself in agreement with what I might call the opening bars of the hon. Member for Horncastle (Mr. Tapsell), particularly when he said that the basic problem with which clearly we are all seeking, to grapple is that of inducing everyone to make provision for old age in some form, and at the same time to make the savings available to the economy as capital. But I am not sure that I followed him quite so happily into some of the other economic theory he advanced. Certainly, did not necessarily share his enthusiasm for the unmixed blessings of private occupational pension schemes. I agree that it is important that people should be induced to provide for their old age. But it would be a tragedy if their youth and middle age were ruined in the process.
I want to begin by directing attention not so much to an economic problem, but to a very real social problem which sometimes arises out of private occupational pension schemes to which are not attached rights transferability. A growing number of private companies offer remuneration to their employees not only in the form of a straight money payment but by providing them with a house, educating their children and, particularly, making provision—sometimes very substantial—for their old age, in a form which, as the hon. Gentleman said, may represent the equivalent of 10 years' earnings.
But the effect is that their whole future, their whole prospects of comfort and a moderately happy retirement, are identified with the company. Not only can the employee not confer on the community the benefits of such contribution as he may be able to make in another situation, but he has been reduced to a situation of near-slavery. That term may appear over-dramatic, but I have come across a number of very tragic instances of a man who has found that his whole future is now identified with keeping in with the establishment where he has happened to find himself. It means that particularly the best companies often find that their
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employees are completely smothered by the benefits being provided for them.
I am not for a moment criticising their intentions. I am certain that frequently their intentions are the best, but it means that an employee recognises that his only hope of success is in remaining within the organisation and making himself as amenable as possible to the organisation and to his superiors, so that he becomes a complete organisation man. His industrial, commercial and social life are wholly dominated by the organisation. If he offends his superior, if he finds that he is not successful at a sport which is fashionable in those circles, if his wife does not get on with the wife of the general manager, he is confronted with a choice of clinging to an organisation where his face just does not fit, or leaving and losing the whole of his pension rights and virtually condemning himself to an old age of poverty. All too often it means that he clings pathetically to the desk or the bench which he occupies as the meal ticket for his future.
It means that any political views which he may have he would be wiser to keep to himself. It means that if he wants to take part in the affairs of the trade union concerned, it would be much wiser for him to restrain his inclinations. It means that his mental processes become wholly caught up in the corporate mental processes of the company. He becomes the victim of a more complete tyranny than any tyranny deliberately imposed by the State, or by a recalcitrant landlord, or an employer who sets out deliberately to kill the spirit of his employees, and this is so often done completely unconsciously, because the company just does not appreciate what is happening, and might even be gravely offended if it were suggested that it was happening.
Having pointed out this possibility of being strangled by the smoothest silken bands, I have made the contribution which I rose to make, but I should like to take the opportunity to point out another problem which has become apparent to me in the last two or three weeks because it has arisen in my constituency. This is a situation which arises in connection with a takeover and which was mentioned by my hon. Friend the Member for Epping (Mr. Newens).
Having found that their company was being taken over, a number of employees

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were immediately assured—and I am sure that they were assured in all good faith—that they would not lose any of their pension rights. This was to be a matter of transferability. They were given the opportunity of subscribing to the pension scheme of the company which had taken them over. They were not given very long to make up their minds—only seven days in which to take advice, discuss it among their friends and finally take a decision which would affect their whole future. However, one appreciates that all too often commerce has to operate in this way and that is not my point.
The point is that, having opted into the new pension scheme, they discovered that it provided increased benefits at the expense of increased contributions. While they will probably benefit in the long run and have little reason to complain, they can be forgiven if at the moment they strongly take the view that this is not the time to increase deductions from their wage packets, particularly when they feel that they were not given a substantial alternative. The alternative would have been to lose the pension rights which had already accrued to them, and many of them, already advanced in age, might have found that even preservation would not have helped them, because they were too old to enter another scheme. They have been steamrollered into a scheme, which in other circumstances they might have looked at twice, on the assurance that they would not lose anything. They are losing immediate benefits at just the time they need them.
I was not surprised when the hon. Member for Ormskirk (Sir D. Glover) expressed the view that we should be very reluctant by legislation to introduce an element of compulsion into the way in which private commerce conducts its affairs. I know the views of the hon. Gentleman, to which he is fully entitled, and this is not the opportunity to question them. However, to say the least, I was a little relieved when some of my hon. Friends did not express similar opinions, because I rather expected to hear from them views which I have heard expressed by some of my friends active in the trade union movement—that this is a matter which should be left to negotiation between the two sides, and which might be expected to produce a
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better result than the introduction of an element of compulsion by legislation.
This is a line of reasoning which I have never understood. On this side of the House we all subscribe to the theory that the economic affairs of the community are best ordered by decisions taken rationally as a community, and not by introducing a jungle where everyone gets what he happens to be in the best negotiating position to snatch. I hope that this is a matter in which, possibly with the consent of both sides, we can work out a method of dealing with the problem not merely to the satisfaction of those in the best bargaining position, but satisfactory and just to everyone concerned.
I do not believe in a situation in which an industry which happens to be making a profit can improve either the pension rights or the straight remuneration of its employees, must less the profits of its shareholders, at the expense of an industry which is in a less strong bargaining position. I do not believe in a situation which will permit producers to feather their own nests if they happen to be in a better bargaining position than the equivalent consumers. I do not believe in a situation which permits some employees of a company, who happen to be in a fairly strong position, to improve their position at the expense of other employees whose share of the profits of the company may be correspondingly curtailed.
Some of the problems have been discussed by the hon. Member for Horncastle. They inevitably arise when we try to fit together the jigsaw of a number of separate schemes of different kinds, some funded and some not, some designed for retirement at 60 and others for retirement at 65, some related to earnings and others intended to produce flat rate benefits. One can see the actuarial problems springing up from the very suggestion of trying to mould them together. Yet we all agree with the hon. Member for Kensington, South that this is a subject with which we should grapple quickly, and I should have thought that the simplest solution was for the Government to introduce at the earliest possible date the scheme on which they fought the last election and to which we all look forward with such eagerness.

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It may be not enough merely to have a national policy for retirement benefit. We may have to go further and introduce a national policy for fringe benefits generally, and after that we may find ourselves compelled to produce a national policy for all remuneration, a national policy which, I hope, will commend itself to all sections of the economy and in which we shall secure from all sections a measure of co-operation, not because it has been introduced because of the necessities of the moment, but because it has been introduced as a deliberate act of policy, as the only way in which to secure fair remuneration, fringe benefits or otherwise.
But pensions may be a very good point at which to begin. I hope that my hon. Friend the Parliamentary Secretary will be able to assure the House not only that the Government recognise the problem—I am sure that we shall get that assurance—but that shortly we shall hear that the Government are preparing to deal with it.
6.0 p.m.
The Joint Parliamentary Secretary to the Ministry of Labour (Mr. Roy Hattersley): May I, first, add my personal congratulations from this Front Bench to the hon. Member for Kensington, South (Sir B. Rhys Williams) on what has been agreed, by all sides of the House, to be an admirable maiden speech. It was obviously a speech stemming from a great deal of knowledge and experience, a speech expressing the view flowing from that knowledge remarkably cogently.
The hon. Member was right to say that he was fortunate in drawing, so early in his Parliamentary career, a place at the top of the Ballot, but political success is concerned with having the ability to take advantage of one's good fortune, and clearly, by the speech he made this afternoon, he has demonstrated that he fulfilled the second part of that political necessity.
I turn now to the substance of his Motion, which urges upon the Government the taking of urgent steps for the protection of pension rights. I reiterate what has already been said by the hon. Member for Horncastle (Mr. Tapsell), that protection of pension rights can mean two things. It will be for greater clarity if I give my own definition of
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what those two things are. The first is simple transferability, and that is the last occasion on which the word "simple" will be juxtaposed with "transferability" during my speech. I define that as buying, in a new pension scheme, rights equivalent to the value, however calculated, of those bought in the old. That is a first alternative.
The second is preservation of similar rights by deferment of benefit. I define that as obtaining a guarantee of a pension, based on the total contributions paid into the old scheme at the time of withdrawal but obtaining the benefits only upon retirement. It is essential that in setting out the Government's position I examine both potential elements of the protection of pension rights, preserved pension and transferred pension.
At the outset I have to say that the problems of transferability, the obstacles to it, are so great as to seem as to appear insuperable to some people—not to my hon. Friend the Member for Barrow-in-Furness (Mr. Booth), but to some. Certainly, they are not simply the result of reluctant management, unwilling or unable to take part in schemes which are to the benefit of their employees, their potential employees and to others. They are technical problems about how the transfer is to be effected, about the value of the rights transferred and the benefits received as a result of the transfer values.
Occasionally, transfer values and the rights in the new scheme are established by an agreed formula. This is particularly so in the public sector, to which I will turn later. Whatever else may be said, it is true that a formula by which transfer values of rights in new schemes can be reconciled, is more often found in the public sector than elsewhere. Most usually, certainly in the private sector, the decision of the first scheme as to what to give and the decision of the second as to what rights can be obtained by that movement, are independent decisions, and very largely unrelated to each other. They pose technical problems often regarded as insuperable.
The transfer value may be calculated in a series of ways. It may be simply calculated on the total sum of the contributions already paid in. In itself this may pose problems, as the employer's contribution may not be a fixed percentage, or a fixed figure in any one year,

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but calculated in some totally different way. On the other hand, the capital value of a deferred pension that an employee might receive, had he chosen deferment rather than transferring the pension, might be regarded as the rights which he takes out of the fund.
Just as these alternatives are available as definitions of what rights an employee takes with him, so there are similar alternatives for deciding the entitlement of an employee in a new scheme. These problems exist in all sectors, even when the two schemes, the scheme from which the employee moves and that into which he moves are identical.
Clearly, when the movement is between two dissimilar schemes the problems are intensified. The hon. Member for Horncastle reminded the House, as did others, of the dissimilarities between schemes, between the age of entry in one scheme and another, between the age of retirement and the benefits, the different sizes of contributions, and the difference in some cases, between the existence and non-existence of contributions.
He reminded the House of the different ways in which an employer might calculate his contribution—one sixtieth or one eightieth being alternative ways of calculating the eventual benefit. If there are difficult technical factors involved in reconciling the movement when two schemes are identical, there are clearly enormous difficulties in reconciling the transfer when two schemes are totally dissimilar.
There is another additional built-in difficulty, and that is that the calculations going into the creation of most schemes are based on the assumption that the salary progress of the insured person, the eventual beneficiary, will, if not gradual, be predictable—that he will go on at something like an equable curve. By definition, when a man changes his job and therefore his pension scheme, he is often doing it to break down that curve of gradual salary. By moving from job A to job B he may obtain, on the point of retirement, a salary on which his pension is calculated and which is far in excess of anything anticipated by his original firm when it made the initial contributions to the pension fund during the first five, ten, or fifteen years of his working life.
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These are only some of the problems involved in transferability, and it is not surprising that the extent to which genuine transferability is open to employees at present is very limited.
Mr. Tapsell: Having said what he has, how does the hon. Gentleman account for the fact that his party, in its 1966 election manifesto, pledged itself to deal with the problem of transferability of occupational pensions?
Mr. Hattersley: I am very much aware that the hon. Gentleman regards my party as being responsible for inadequacies which he dated back to 1859. I will try to explain to him that the Government are offering a series of alternatives. All that I am trying to do at the moment is to set out some of the difficulties.
I am sure that the hon. Gentleman, like the rest of the House, expects a serious consideration of the difficulties. If he thinks that the difficulties do not exist he must tell us. I now intend to go on to deal with the difficulties of the alternative scheme, preservation, and then I will try to explain what is the Government's attitude to these alternatives, which I hope will satisfy the hon. Gentleman. I will even deal with the election manifesto.
I was saying that with all those objections it is not surprising that the existence of genuine schemes offering the reality of transferability and not simply the prospect of transferability is very limited. Both the public and private sector contain notable exceptions to that rule. I call to mind, in the absence of the hon. Member for Rutland and Stamford (Mr. Kenneth Lewis), who had hard things to say about the inadequacy of schemes for the public sector, the negotiations recently held between British Railways and the Civil Service to bridge the gap and solve the problem. It is right to say that because of these difficulties, these technical obstacles, transferability is not a frequent feature of pension schemes today.
Let me turn to the alternative, deferred pension rights. I do not regard this as an easy alternative. It is not without problems. Deferred pension rights produce a fragmentation of pension schemes, with all the complication and inconvenience, and administrative difficulty that that implies. They are particularly

849
vulnerable to inflation since they are calculated at a date many years before the participant actually enjoys his pension.
Clearly, the element of the eventual pension may be calculated on a small part of the salary, which has little or no relationship to the eventual salary received. At least there is one thing which can be said about deferred pension rights, and that is that in the immediate future they are more feasible, more practical, more easily put into operation than is transferability.
As we have been reminded, my right hon. Friend the then Minister of Labour decided to examine all the implications of these two alternative schemes as far back as 1966. He set up a working party which has been referred to this afternoon as the Morgan Committee. It was a subcommittee of my right hon. Friend's National Joint Advisory Council. It reported in April, 1966, and its report was considered by the National Joint Advisory Council, after consultations by the parties on that Council with their constituent organisations, in October of that year. It was its conclusion, as it is mine today, that deferred rights are at least more feasible, more practical and more likely to be put into operation than is complete transferability. It made four recommendations to my right hon. Friend the then Minister of Labour.
The first recommendation was that universal and effective arrangements for preservation are desirable. The second was that deferred pension rights should be a minimum aim, whatever the reason for withdrawal. The third was that inevitably this involved a restriction on the individual's right to withdraw his own contributions. The fourth was that a direct statutory requirement should be imposed on occupational pension schemes as the only conceivable way of bringing about these admirable aims.
These considerations were advanced, and this point of view was advocated, largely for reasons of social justice rather than economic necessity, for the Morgan Committee concluded that the effects on mobility are limited and selective and do not provide a compelling argument for the general requirements of preservation. I do not think that that statement, which the hon. Member for Kensington, South
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regarded as slightly complacent, is totally at variance with his experience and beliefs. I believe that the areas to which it refers as being limited and selective are probably the areas about which he knows most. They are certainly the areas of the higher income groups—middle and top management.
The Morgan Committee, while making that qualification, accepted that the problem exists. Certainly, I accept that that problem exists and the four conclusions of that Committee as endorsed by the National Joint Advisory Council of the Ministry of Labour—that if one is to bring about these pension schemes in the numbers that the nation and the economy require, it must be done by direct intervention of the House of Commons. I do not believe that exhortation and example will do. I do not believe that tax incentives and penalties would be adequate. In many ways, they would not be fair and certainly would not move sufficiently quickly. If we are to bring about the schemes in sufficiently large numbers, it must be done by the House of Commons expressing by Statute its belief that an obligation must be placed on management.
However, having said that, I must issue a warning which endorses the caution of the hon. Member for Ormskirk (Sir D. Glover). He reminded us, rightly, that in a situation in which it is not compulsory to set up a contributory pension scheme any statute which makes compulsory pension schemes more expensive, more exacting to operate and more difficult to administer may prevent some firms, and clearly firms at the margin of decision, from setting up a scheme. I accept that difficulty, but I reiterate that if we are to do it we must do it by statute.
The second disadvantage which I must bring to the attention of the House is the cost of making such schemes universal. It is estimated that they would amount to£50 million gross cost—about 5 per cent. of the total annual cost of pension schemes, or about 0·5 per cent. of the total national wage bill. It was those costs which made the C.B.I., represented on the National Joint Advisory council, conclude
"that any move to provide for compulsory preservation must be deferred until the economic situation justified the additional costs which would fall on employers".

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When I ask the House, as I shall in a moment, to be a little more patient with the Government, and with successive Governments which have failed to meet the problem, I do not do so for that reason.
Mr. Tapsell: Successive Governments have not pledged themselves to deal with the problem.
Mr. Hattersley: The hon. Gentleman is very eager about this point. He has at least three years in which to see that pledge fulfilled. If he waits for another three minutes, he may see what the prospects are.
I am not asking the House, the nation and the economy to be a little more patient because of those economic considerations, important though they are. Many of my hon. Friends will argue, and I hope that many hon. Members opposite would argue, that the economic considerations must be overriding in all our decisions at this moment. However, there are other reasons why I must ask the House to wait a little longer, paramount though the economic considerations must be.
The reason is that which I suspect the hon. Member for Horncastle is anticipating, namely, that a major review of policy in this field is under way and that major review is clearly intimately linked with decisions on the transferability of pensions. The major review includes the possible extension of graduated schemes, and I could not possibly say or do anything today and nor could my right hon. Friend the First Secretary propose to the House anything which might pre-empt those schemes, which might confuse those schemes or conflict with them or which might imply what those schemes contain. The House does not have long to wait to know what they contain.
My right hon. Friend the Minister of Social Security announced to the House on 4th March—it appears in column 23 of the OFFICIAL REPORT for that date—that she hoped to produce a White Paper on her scheme and her entire review by the end of this year, and the final view of the Government about how such a scheme of transferability can be operated must await the production and printing of that White Paper.
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However, it remains the Government's view that they must tackle the problem of transferability. If the House wants us to vouchsafe our good intentions, I do so by saying that I do not ask the House to vote against the Motion. It is not a Motion which I should have tabled myself, because perhaps the hon. Member for Kensington, South and I would argue about the meaning of "to take urgent action" and "in every practicable case".
But, putting those semantic difficulties aside, and hoping that the hon. Gentleman will believe that the end of 1968 amounts to "urgent action" and that "in every practicable case" means exactly what it says, while I do not urge the House to support the Motion, I certainly do not ask it to reject it—not simply because of the admirable way in which it was moved and the spirit of bipartisanship which has characterised every speech, except one from the benches opposite, but because the Government are committed to the principle and understands very well the necessity of bringing this about, and intend to bring one or other of the solutions about at the earliest opportunity.
6.17 p.m.
Mr. Charles Mapp: I was intrigued by the concluding words of my hon. Friend the Joint Parliamentary Secretary. I am very anxious that the review to which he referred should be completed quickly. Not only this side of the House but the country would be very disappointed if that review was not made public and if legislation did not follow it by the end of the year.
I wish to return to the immediate issue before the House. Perhaps I should declare an interest. I am a member of a small panel of the Society of Pension Consultants, which has distributed an interesting document to us. However, I am in no way committed to its general principles and I have told the Society that, while I have some knowledge about these matters, I have great reservations about certain of its points of view. This debate appears to have emanated from that kind of background. I regret that that kind of background has, in effect, created this discussion.
The Motion
"calls upon Her Majesty's Government to take urgent action to ensure that pension rights

853
can under no circumstances be extinguished and in every practicable case should be made fully transferable…if required…".
My hon. Friend the Joint Parliamentary Secretary did not mention this, but I want to say emphatically that if the Government take away from either salaried or wages people in industry the right to leave a firm and take with them the credit which has accrued to them in whatever pension funds there may have been, and if they seek in substitution to offer to the worker or the salaried person some deferred pension scheme, they will be misunderstanding public opinion.
I am one of those who has been covered by superannuation away back since 1917 or 1918. I belonged to a railway fund in which the members had a committee of management with the employer. Many private schemes are imposed upon workpeople as a condition of service. I take the view that contributions to properly organised schemes are desirable in addition to what the State might provide.
What is happening in industry, however, is that work-people and staff are contributing very heavily to funds but have no expression whatever in the way those funds are used. Nor can they exercise any influence in the investment policy which is applied to those funds.
It seems to me that if I were a reasonably modern employer and I wanted to take into consideration industrial relationships as we know them, part of my attitude to my staff would be that I would want them to make provision with me as a firm for later eventualities in life. In return for the contribution which I might make, I should offer to them some form of democracy as to how those pensions were used.
In the speech of my hon. Friend who preceded me, I picked up the question of consultation with the trade unions. As I have said, I belonged to a railway fund in which there was consultation throughout. Tie Minister should realise that there is a vast amount of money in these private schemes that people have contributed in the hope that, at some time, they will return to them as pensions. A terrific financial empire is built up on these funds from year to year. The investment policy behind them is
854
never questioned anywhere. In my opinion, that is a point which should be in the Government's mind when, later this year, they issue their White Paper.
How many of these schemes are conditions of service? In my case, and with many firms across the country, participation in a scheme is made a condition of service. That accounts for the fact that among the unemployed we find, perhaps, more than a proper average of people who are past the age of 45 or 50.
We must realise the difficulties and dangers of firms saying, "Everything else is equal, but we are not recruiting you because you have gone beyond the proper age for our superannuation fund". They may or may not have heard of late age entrants and the higher amounts which should be paid. That is probably due to the fact that many of these firms, having committed themselves in principle to pension funds, hand out the policy and details of the funds to consultants and they are unapproachable by the staff.
I take the view that that is undesirable. If I were collectively involved in industry on the trade union side—and I was on the railway—I would not tolerate my colleagues in that way, although it may be to their advantage later, contributing to funds, involving considerable finance, but having no say whatever in how those funds are used or, indeed, to what extent the interpretation of the rules is generous or restrictive. I hope that the Minister will bear these thoughts in mind.
In all this discussion, I notice a complete absence of any reference to the possibility of what happens to the interests of employees who have been paying over a long period. The present practice is that, in the main, a person can take his money out. The fact is that, as a rule, there has been an equal contribution or otherwise between the firm and the employee. If he leaves halfway through his life, he gets the return of his contributions.
Those of us who are familiar with the running of superannuation funds know full well, however, the extent of accretion each year to the funds contributed by employers and employees. The interest which arises in the management of the fund helps it to maintain viability. To take out simply the employee's

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contribution and to retain the interest which has accrued on his contribution is manifestly unfair. In my opinion, this robs him of a share of his investment. That is what it amounts to.
My hon. Friend the Joint Parliamentary Secretary said that a scheme had been agreed between the railways and Government Departments, of which I have some information, but it took a long time to bring it about. We have, I think, reached the position that when a salaried person moves from the railways, which had a committee of management representative of both sides, into the Government scene, he moves into a sector in which there is little or no consultation about how the funds are dealt with.
I would like to say this last word. If we are to talk about the transferability of pension rights, in my opinion this will not appeal at all in a world in which, over the period of a generation, inflation destroys the value of whatever deferred pensions we might have in mind. I am not over-anxious that the world of cover for the industrial worker should be taken over too much by professional people—although they have their place—or should be taken over too much by institutions involved in finance. I want to see the State take a greater share in this.
I would also like to see the private side of industry put its house in order in many ways by agreeing to a far smaller number of much more democratically managed schemes which would be commendable to a large number of firms. In that way, it would be possible to get something approaching uniformity and to make easier in due course the kinds of things which are mentioned in the Motion.
If the words
"under no circumstances be extinguished"
preclude an individual from leaving his firm to go into some other form of business or another form of work, and if he is unable to get back at least the amount which he has paid in together with the appropriate interest which has accrued on it, I would differ completely with the proposal which is before the House.
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If the Motion accepts that principle, I would have a different view about it. I hope that the Government will bear this in mind in building up their thinking, the results of which we shall learn in due course in their White Paper.
6.29 p.m.
Mr. George Wallace: It so happens that I have had a great deal of experience of these matters in a personal sense. I have been in two superannuation schemes, one of which was contributory and from which I had my cash refunded. Subsequently, before entering the House of Commons, the opportunity was given to me to carry on my pension scheme on a transferable basis.
I am generally sympathetic to the Motion. There is no doubt about it that the problem we are discussing is the problem of the older man. The younger man can take a gamble, but not the older man, the man of 45 or 50.
I think that there is a short-term solution. I happen to have been in a superannuation fund before I came back to the House. It was on an endowment policy basis. I had an endowment policy, my employer had an endowment policy. When I left I was able to take my policy over and carry on the contributions. If all schemes were on that basis I am sure the problem would not be so serious as it is at present. As I said, the problem is more difficult for the older man, but if the older man had to face up to the situation and had an endowment policy he could carry on his contributions on change of employment. So I would suggest that if we could manage to persuade large firms to go over to the endowment policy basis much of this problem would cease to exist.
I agree with my hon. Friend who mentioned equation of pensions with conditions of service. One firm I was employed by some years ago definitely made entrance into the superannuation fund compulsory, and a condition of service.
We are discussing transferability of pension rights when a person has made contributions, but there are also noncontributory pensions, and the whole problem is, if we are to give transferability of pension rights to the noncontributory pensioners, the people in a non-contributory scheme, then, in a

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sense, we are giving an unfair balance to them compared with the person who has made contributions.
There is no cut and dried, short-term solution. It is a most difficult, complicated problem, and I would end, as I began, by suggesting that many firms would be well advised to turn over to the superannuation schemes on an endowment basis. I am not going to sell insurance here, but it is obvious common sense, for if there is an endowment scheme one can decide to carry on and the older man would be able to benefit. The younger man has a temptation to spend his refund of contributions, contributions which he has cursed every pay day when he has had them deducted from his pay. The younger man can take a gamble. The older man cannot. I did not take a gamble. I made sure I was covered.
6.35 p.m.
Mr. Alexander W. Lyon Mr. Alexander W. Lyon (York) rose—
Mr. Tom Boardman: On a point of order. Is it in order for this debate to be continued by hon. Members who have not been in the House for very much of the debate and are coming in one after another, and when there is on the Paper another Motion in my name, a Motion which is of considerable interest to hon. Members? Cannot the House move on to that next Motion?
Mr. Speaker: I have some sympathy with the hon. Member, but all that is happening is in order.
Mr. Alexander W. Lyon: Both my hon. Friends who have spoken—[Interruption.] I am sorry that the noble Lord the Member for Hertford (Lord Balniel) finds it deplorable to express one's opinion in a debate in the House. I always understood that the House was the home of free speech and that one could exercise that right in any debate and that the procedure of the House was so ordained that, if one wished, one could make a contribution. I intend to make that contribution despite the seated objection of the noble Lord.
Both my hon. Friends who spoke earlier had to declare an interest, partly by reason of professional interest in occupational pension schemes, partly by
858
reason of the form of occupational pensions which they had. I can speak from a disinterested point of view since I have never been in an occupation where there was an occupational pension scheme, and my interest in the scheme which is related to the occupation I now hold is one which will not mature for some little time, though I am optimistic that I shall live to draw it.
I was educated by much of the discourse of my hon. Friend the Joint Parliamentary Secretary in relation to this question. One is always in debt to him for the way he so persuasively marshals the arguments both for and against before intimating the opinion of the Government, but I thought that there was, perhaps, a flaw in his argument about the method by which one can overcome the difficulties of applying the principle of transferability to private occupational pension schemes in industry. The point was made partly by my hon. Friend the Member for Norwich, North (Mr. Wallace).
If it is now possible, at the termination of employment, before pension rights can become due, for contributions to be repaid in a lump sum, as is so often the position in occupational pension schemes, without any right either to the interest or to any part of the employer's contributions, would it not be possible by legislation to enact that the employer would be able to use the premiums which have accumulated over the years to buy a lump sum annuity which could be set aside for the use of the employee upon his retirement or upon some future date? It would be, of course, a short-term, transitional provision, because one hopes one will be able in due course to move to a more permanent solution to the problems which face us in this difficult situation, but in that short term would it not be possible to enable the employer to use those accumulated premiums for this purpose?
One of the tragedies, I feel, of the present situation is that when an employee has accumulated premiums for quite a considerable time, there is a temptation, particularly in moments of financial stress, for him to take the benefits which have accumulated in a lump sum to deal with the passing, temporary financial crisis. Sometimes it is a question of paying off hire-purchase instalments,

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sometimes it is a question of moving home. At that moment there is a very real temptation, through the opportunity provided by a private occupational scheme which pays out premiums in this way, to take the lump sum.
Although one wishes to encourage mobility of labour, one does not wish to do so at the expense of the provision which is made by the pension schemes, and rightly made, for retirement in old age, and, therefore, it may be desirable to adopt a scheme of this nature, which would put an end to the right of the employee to take his money in a lump sum there and then, and take it only in the form of an annuity paid for out of the premiums he has contributed. After consideration with industry, it may be possible to implement some scheme whereby part of the employer's contribution could also be put into a fund for the annuity.
Somehow, this problem has to be overcome. All of us would agree about that, because mobility of labour in a modern, expanding economy such as this is absolutely essential if we are to grow at the rate which the Government intend. One of the tragedies of the growth of private occupational schemes is that they have led to a reduction of mobility of labour and to very real fear of men approaching the age of 50 that they will not be able to be employed by a new employer after that age. This has meant a rigidity in movement rather than a mobility. If the Government are to implement their economic programme, they must find a way of ensuring full transferability of pension rights.
The hon. Gentleman the Member for Horncastle (Mr. Tapsell) interrupted my hon. Friend to chastise him about the failure to implement the promise in Labour's election programme. He failed to point out, however, that the assurance about transferability of pension rights in occupational schemes was linked with the promise to implement a national superannuation scheme through the State, and that the two must intimately go together. It is impossible to deal with them apart.
The cost of ensuring full transferability of pension rights under private occupational schemes at this stage, before a full national superannuation scheme had been
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worked out would be infinitely higher than if a national superannuation scheme were implemented which gave rights as good as or better than those provided in occupational schemes, and, therefore, reduced the size and number of such schemes.
The original scheme was worked out by the Lord President of the Council, the right hon. Gentleman the Member for Coventry, East (Mr. Crossman), who is now responsible for this part of the Government's programme. It was implicit in his thinking and reasoning on the document on national superannuation that private superannuation schemes would tend to be at any rate reduced as a result of the implementation of a Government programme. If the benefits afforded by a Government scheme are of the order of or greater than half pay on retirement, the employee will be unlikely to favour any private scheme which gives less protection in old age or which, if it is applicable in addition to the national scheme, will cost him more in contributions.
The employee will, therefore inevitably look much more favourably on the national scheme and for that reason it was expected that the private sector of occupational schemes would tend to be reduced. It is one reason why I have always supported the scheme that was put forward by the Labour Party in 1958 which is still awaiting implementation. It is highly desirable that all workpeople, whether they are employed or self-employed, should have afforded to them the same kind of benefits in later life.
One hazard of being a member of the profession in which I earned my living before I came into the House is that there is no occupational pension scheme. It was for that reason that some justification was put forward for the barrister's year, that at the end of a
period—
Mr. Speaker: Order. We are talking about the transferability of pensions. If there is no pension, one cannot transfer it.
Mr. Lyon: I was illustrating, perhaps at some length, why I support the concept of a national superannuation scheme which would ensure to everyone full transferability of their pension rights,

861
irrespective of the employment in which they were engaged. One way in which this would be afforded would be to self-employed people such as members of the Bar, who have now lost the right of the barrister's year.
I pass on to the rest of my arguments, as I see that the Chair is restless. I believe that this problem cannot be dealt with until the implementation of the State superannuation scheme. Since the White Paper has been promised before the Summer Recess, the House ought to respond to the appeal of my hon. Friend that we should wait for the White Paper so that we can decide what remnant of private occupational schemes will require legislation or administrative action to ensure full transferability.
In the present economic situation it is clear that it will not be possible to implement the White Paper on a State superannuation scheme for some time, and it may be that there will be need for legislation or administrative action to cover that interim period. That is why I made the suggestion at the beginning of my speech that the Government might consider the idea of ensuring that the accumulated premiums were used to buy a lump sum annuity at a later date. If, as in the scheme which my hon. Friend referred to, the occupational scheme has built into it the accumulation of an endowment assurance, it will be possible to utilise that, but most private occupational schemes, as I understand, do not have that provision. It is perhaps a pity that that is not so, but it would be possible to build in this defence for a tiding-over period.
I hope that my hon. Friend will consider that solution to the problem.
6.46 p.m.
Mr. Stanley Henig: In following my hon. Friend the hon. Member for Bradford, East (Mr. Edward Lyons) I want to draw a point of contrast. He apparently came to the House from that noble but evidently under-paid and under-privileged profession, the Bar. I came from a profession where the superannuation rights were very good indeed and that is why, Mr. Speaker, I sought to catch your eye at this late hour of the debate in order to make a short contribution.
862
I have felt the effect of the present situation in which, after having contributed to a pension scheme for some time, one is suddenly in the position where various choices are offered to one other than continuation of that scheme. As I had been working only a short time as a university lecturer, I had contributed only for some 18 months to the F.S.S.U. scheme. All that was at stake was the beginning of my savings towards the distant date when I retired. At the time the choices were posed to me, I had to think of the position of somebody older than myself making a similar move. I doubt if one would want it to be laid down that the only university lecturers who can stand for Parliament and risk being elected and losing their superannuation rights are those below a certain age.
Several choices were given to me. First of all, on a short-term basis, I could have a year's leave of absence if I paid both my own and my employer's superannuation contribution. This, added to the Parliamentary scheme, would have meant a large burden on my somewhat stringent financial resources, so that was out.
The second choice was to withdraw the money already put in. Everybody would agree with this principle, but in the case of the F.S.S.U. all contributions on both sides are made at the beginning of the academic year. I could have drawn out 18 months' contributions, but against that I would have had to pay the employer's contribution for some months forward, and the net figure drawn out would thus have been negligible.
The other point put to me by the F.S.S.U. was that I could ask whether Parliament was prepared to accept transferability, in which case I could transfer back. I did not find that course tremendously appealing. The remaining alternative was to transfer the bit of superannuation rights that I had to a paid-up policy accruing to me when I was 66. That is something to look forward to, at least, although it does not amount to much.
In this day and age, we should welcome a certain amount of mobility of labour, but people who change professions are likely to find themselves with no concrete, satisfactory and large superannuation.

863
Linking that story to service in this House, against it we have the rule that hon. Members with 10 years' service receive a fixed pension on retirement. An hon. Member with less than 10 years' service does not get it. In the case of an hon. Member serving in this House for seven or eight years, there is nothing to transfer to him.
We are discussing the possibility of making some kind of liaison between the various private pension schemes. However, not only are they different from the point of view of transferability; they are different in regard to all kinds of other matters as well. Some of them look forward to half pay on retirement, some to two-thirds pay on retirement, others to two-thirds of average pay, and so on. In trying to make transferability possible, it is obvious that one will run up against all kinds of other problems. People will be moving from one profession to another where the ethics involved in terms of pension schemes may be very different.
Although the Motion is eminently laudable and worth while, and while I am certain that we on this side of the House will certainly not wish to vote against it, it becomes just that bit irrelevant. As they move from one job to another, if certain people are guaranteed half pay on retirement, why should not the same privilege be extended to other people who never were in a job giving that right? Surely the whole rigmarole of different private pension schemes with different rights be overtaken by something much more far-reaching. Obviously, it would be out of order now to go into details of the kinds of State superannuation schemes which have been produced from time to time.
But there is no point in trying to paper over an edifice where the cracks grow bigger as one papers over those which already exist, and that would be the case if one brought about transferability without dealing with the aspects which are most wrong in the present set up of private pension schemes. I refer to the facts that some are better than others, and some are a condition of service while others are not, quite apart from the fact that some employers have no private pension scheme at all.
864
One needs, therefore, to try to widen the application of the Motion and say that, instead of transferability, what is required is some kind of equality between private pension schemes and, ultimately, a State pension scheme which can supersede the lot. If that comes about, a person changing his job will not have the problem which I had to face of having to decide whether to take back my contributions, pay more, or carry on both sets of contributions. He will be able to move from one job to another knowing that every one has the same kind of superannuation, with so much for the employee and so much for the employer, and knowing that everyone gets the same at the age of 65.
That is why I welcome the Motion. I regret that it has not gone as far as it might have done, and I hope that the next time that the House discusses this very real problem it will have something much more concrete to consider, with the possibility of moving towards not just equal treatment for those who are already privileged, but something providing the same treatment for the privileged and the not so privileged.
6.55 p.m.
Mr. John Lee (Reading): I understand from my hon. Friends that the hon. Member for Kensington, South (Sir B. Rhys Williams) made what was his maiden speech earlier this afternoon, although his opening remarks were not the customary ones. But I have verified from my hon. Friends that that is so, and we congratulate the hon. Gentleman for having raised this important subject.
A number of my hon. Friends have illustrated from their past experience the ways in which the disadvantages of non-transferability apply. My hon. Friend the Member for York (Mr. Alexander W. Lyon), for example, belongs to a non-pensionable profession, as I do. My hon. Friend the Member for Lancaster (Mr. Henig) has had to sacrifice a pensionable occupation to enter the hazards of political life. I am in a mid-way position inasmuch as I practice at the Bar but draw a small occupational pension of £168 a year pro rata with my service overseas in a pensionable occupation.
I mention that because it has a direct relevance to the problems that the hon. Member for Kensington, South has raised. Long before transferability came to be

865
discussed seriously in this country, in the Overseas Civil Service it was possible to transfer one's pension rights. If one joined the Service in one colonial territory, one entered its own scheme. On transferring to another colonial territory, one's pension rights were also transferred. It did not matter if the salary scales, the terms of service and the length of service required to qualify one for persion were different. It did not matter if the territories in which one served were in totally different parts of the world. One's pension rights went with one.
I know a man, for example, who served in no less than five territories in different parts of the world and collected pension rights from each of them. When he retired, his pension was paid by five different Commonwealth and Colonial Governments. In the case of one of them, he had to wait five years after the normal retiring age to draw the pensional ingredient—
Mr. Tom Boardman: The hon. Gentleman clearly is concerned with the problems of the retired and the elderly. How can his concern be consistent with the deliberate policy which we are witnessing from the benches opposite, with hon. Member after hon. Member taking part
866
in a filibuster designed to enable the Government to avoid having to reply to the debate?
Mr. Lee: That is all very interesting, but it has nothing to do with the Motion. I am concerned with the transferability of pension rights. I was making the point, which I thought that the hon. Gentleman was capable of understanding, that what was done overseas years ago ought surely to be done here. I am sure that the hon. Member for Kensington, South will understand my point.
I was putting forward an extra argument in favour of the general principles which the hon. Gentleman has advanced. I was about to show that in one case, at any rate, whereas the normal retiring age for the Colonial Service is 55, the person to whom I have referred had served in the Bahamas and Bermuda, where the retiring age is not until 60, and that he had to wait another five years to draw his pension rights which had accrued in those territories. However, those rights were preserved—
It being Seven o'clock, the Proceedings lapsed, pursuant to Standing Order No. 5 (Precedence of Government business).

ORDERS OF THE DAY

  CUSTOMS DUTIES (DUMPING AND SUBSIDIES) AMENDMENT BILL
  Order for Second Reading read.
  The Parliamentary Secretary to the Board of Trade (Mrs. Gwyneth Dun-woody): I beg to move, That the Bill be now read a Second time.
  The main purposes of the Bill were summarised by my hon. Friend the Financial Secretary when he moved the Ways and Means Resolution on 13th March. Before I explain these purposes in more detail, perhaps I could make a few remarks about the international rules on anti-dumping and on the principles of our legislation.
  To avoid undue interference with the development of international trade, protection against dumping is subject to certain rules which are laid down in the G.A.T.T., and the 1957 Act is based on these rules. Dumping is defined in a specific way. In the usual technical sense of selling for export below the home price, dumping is a fairly common practice, and not necessarily, or even normally, objectionable; though, of course, it may be if it is believed to be causing or threatening the domestic industry with material injury.
  Before action can be taken against dumping or subsidisation, the Board of Trade must be satisfied on three counts: first, that the imports are dumped or subsidised; secondly, that the dumping or subsidisation is causing or threatening material injury to a British industry; and, thirdly, that such action is in the national interest. Under this last head, we have regard, among other things, to the interests of the British consumer, who may himself be a manufacturer or exporter.
  During the Kennedy Round of trade negotiations, the British Government tried to secure the agreement of many member-countries to the full and more uniform application of the G.A.T.T. rules. The major participants finally agreed on a code which goes a long way towards meeting this objective.
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  The code should help our exporters of goods to countries that have signed it, and these include the United States, Canada, all the E.E.C. countries, most E.F.T.A. countries and Japan. Perhaps I may give a few examples
  Our exporters to the United States have complained for many years about the indefinite and sometimes very lengthy period during which Customs appraisement can be withheld for goods provisionally assessed as being dumped. The resulting uncertainty has frequently inhibited and sometimes killed export trades from Britain and other countries to the United States. The code will limit such provisional action in normal cases to a maximum of three months and will impose restrictions on the ability to take retrospective action.
  Our exporters to Canada have complained for a long time about the semiautomatic imposition of anti-dumping duties on goods of a kind made in Canada and alleged to be dumped. Acceptance of the code will require Canada to amend her anti-dumping legislation so as to have regard to material injury before taking anti-dumping action.
  The E.E.C. countries have very recently adopted regulations for action against dumping and subsidisation which follow the code very closely indeed. Under the Bill, as under the 1957 Act, we shall be able to take action against subsidised goods in the same way as against dumped goods. In practice, subsidisation usually leads to dumping as well and it may be easier to take action against the dumping. To simplify matters here I will refer only to anti-dumping, but this should be taken to include action against subsidisation as well.
  Most anti-dumping applications involve a conflict of interests, domestic producers, on the one side, and domestic consumers and international considerations, on the other. It is quite impossible to please all of the people all of the time, but we have tried to be fair all round. We consider it is in our own interests that the international rules should be observed by as many countries as possible, and it follows that we must abide by the rules ourselves even though they do not please everyone.
  It has been the Board of Trade's policy, and this is now embodied in the code,

  869
  normally to require applicants to make out a prima facie case before a full investigation is undertaken. We recognise that it is often extremely difficult for a domestic industry to obtain proof of dumping and we do not expect it of them. All the Board of Trade require of applicants is reasonable prima facie evidence.
  Once the Board accepts a case for full investigation, the Board takes on itself the burden of proving whether or not dumping is, in fact, taking place. This generally requires a detailed and accurate comparison between the overseas exporters' home price and the export price of goods comparable with those made by the United Kingdom industry. If necessary, our officials visit the exporters in their offices overseas for detailed inquiries on the spot.
  The Board also requires prima facie evidence that the alleged dumping is causing or threatening material injury to the British industry. This evidence is often more readily available to the industry, but it sometimes appears unable or unwilling to provide it. Indeed, some firms still argue that the Government should act on evidence of dumping alone, but, as I have explained, this would be against our general interest as a great exporting country and it would be inconsistent wilt our international commitments.
  Mr. Patrick Jenkin: Is the hon. Lady aware that under the new code, as well as the generally accepted interpretation of Article 6 of G.A.T.T., the need to prove material injury was relevant only in the case of dumping from another G.A.T.T. member? I understand that the Board of Trade has always extended that so that it applies to dumping from any country. Can the hon. Lady give the explanation why the burden of proof on the applicant should be as severe in the case, shall we say, of dumping from an Iron Curtain country as, quite rightly, dumping from a G.A.T.T. country?
  Mrs. Dunwoody: The hon. Member knows that this is a very interesting point. The Bill includes certain provisions which will assist us, for instance, where we are endeavouring to get evidence, particularly in cases of centrally controlled economies, and these will deal
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  with many of the cases concerning Iron Curtain countries.
  Mr. Jenkin: With respect, the hon. Lady has directed her mind to the other leg, whether or not there is dumping, and we shall no doubt be discussing that. My question—and I shall be grateful for an answer, because it concerns many industrialists—is: why does the Board always require the same proof of material injury in the case of dumping from a non-G.A.T.T. member as in the case of dumping from a G.A.T.T. member?
  Mrs. Dunwoody: If the hon. Gentleman will forgive me, this will be fully covered in the summing up that is to be undertaken by my hon. Friend the Minister of State. I think that he will find the answer to his question.
  I have already said that the Board also requires prima facie evidence that the alleged dumping is causing or threatening material injury to the British industry. This evidence, as I have said, is often more readily available to the industry, but it sometimes appears unable or unwilling to provide it. I have already said that dumping in the technical sense is going on much of the time. We cannot take action against dumping unless it is causing or threatening material injury and unless such action is in the national interest.
  The value of our administration of the Act to our manufacturers supplying the home market must be judged not only by the number of Orders imposing duties but by its effect as a deterrent. Since the Act came into force, we have received just over 100 formal applications for action under it—that is, on average, about 10 a year. Anti-dumping duties were imposed by Order in 12 cases. Satisfactory assurances were received from exporters in lieu of duties in 19 cases; and a number of other cases were withdrawn by the applicants during the course of our investigations because the applicants had reached agreement with the exporters concerned by which the dumping was eliminated or reduced. In some cases exporters in other countries have been deterred merely by the submission of an application to the Board of Trade—
  Mr. Charles Mapp: I thought I heard my hon. Friend aright

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  in saying that a number of applications had been withdrawn because agreement had been reached that dumping had been eliminated or reduced. If there is a measure of discretion, the dumping is not disposed of. Dumping is either dumping or it is not. To accept a halfway stage is something which avoids the main principle.
  Mrs. Dunwoody: I hope that my hon. Friend will forgive me when I say that, while I do not dispute that, there were a number of times when the Act acted as a deterrent. We should not underestimate the value of the Act's effectiveness. Exporters in other countries have been deterred merely by the submission of an application to the Board of Trade and have voluntarily adjusted their prices so as to eliminate dumping. The fact that such adjustments and assurances receive less publicity than formal duties and rejections of applications makes people underestimate the effectiveness of the Act as a deterrent to materially injurious dumping.
  I turn now to the Bill. With one exception, our procedures under the 1950 Act are already broadly in line with those in the anti-dumping code to which we shall now be paying strict regard. The main feature of the present Bill is to provide for this exception by giving the Board of Trade wider powers to take provisional action in appropriate cases in the interests of our domestic industries. The Government stated in the National Plan that they would consider the amending legislation that is now before the House.
  Mr. R. J. Maxwell-Hyslop: The hon. Lady said the 1950 Act. Did she mean the 1950 Act, or the 1957 Act?
  Mrs. Dunwoody: I beg the hon. Gentleman's pardon, I meant the 1957 Act.
  Once a formal application is made, our investigations must be thorough to do justice to all the parties concerned and this inevitably takes time—60 per cent. of the cases take six months or more. The provisional powers we are now seeking in Clause 1 of the Bill are designed to prevent serious injury being caused during our investigation. For reasons
  872
  of policy and of practical administration, we intend to take provisional action only sparingly and only where there is particular need for it. That is the object behind the words
  "in the circumstances it is expedient"
  in Clause 1(2). This is in line with the views of industry and agriculture. The C.B.I. regards such action as desirable in appropriate cases and the N.F.U. has not suggested that the Government should use the additional powers frequently but want them because of their potentially deterrent effect on sporadic dumpers, especially of seasonal products.
  There are two main categories of cases for which we shall consider action. The first is where there is a real danger of forestalling, that is to say, of importers seeking to bring in relatively large quantities for stock-piling in anticipation of an anti-dumping duty. The second concerns products, mainly in agriculture, where trade varies greatly with the time of the year. In these cases, the period taken by a full investigation may mean that remedial action in the shape of a definitive anti-dumping duty comes too late to influence trade at the important time. We shall normally require applicants to make out a prima facie case to our satisfaction of dumping and, under Clause 2(3), of material injury—or the threat of it. We shall also require applicants to show why provisional action is particularly needed in their case.
  Provisional action will be in the form of a provisional charge to duty imposed by a preliminary Order subject to the negative Resolution procedure. The provisional charge will be equal to the estimated margin of dumping. The Schedule provides that the importer may meet the charge by giving security to the satisfaction of the Commissioners of Customs and Excise. We consider that this will effectively counter the suspected dumping during the period of investigation. For practical reasons which we can explain more fully in Committee, Customs and Excise will require, save in exceptional circumstances, that the security is by deposit of money.
  At the end of the provisional period, if our investigations confirm that dumping has been taking place and, in accordance with Clause 2(4), has caused material injury to a British industry, a retrospective

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  Order will be made which will be subject to an affirmative Resolution of the House. The Order will impose a definitive antidumping duty as from the date at which the preliminary order came into effect. If the definitive duty exceeds the provisional charge, only the latter will be levied for the provisional period. If the provisional charge exceeds the definitive duty the excess will be refunded.
  The important thing is that no one will be asked to pay duty for a period earlier than the one for which the provisional charge will already have been imposed and no one will be asked to pay more duty than the provisional charge, on goods imported during the provisional period. Importers will therefore know the full extent of their potential liability to a definitive duty and will already have given full security in cash for it. This is not retrospective action as it is normally understood.
  In accordance with the code, the provisional charge to duty will normally last three months. However, Clause 1(3) will allow us to extend it by a further three months. This is required partly to meet a special provision in the code which we do not expect to arise much in practice. But it will also enable us, should we consider it expedient, to extend the provisional period more generally to six months in cases involving only countries who do not adhere to the code. This is part of the answer to my hon. Friend. This will give us more time to complete our full investigation, and will also give us more discretion in the case of countries which have not signed the code and which take anti-dumping action freely against our own exporters.
  I have referred to Clause 2(3) and (4). Clauses 2(1) and (2) set out more clearly but do not change in any other way the provisions relating to G.A.T.T. countries which are already in the 1957 Act, in the complicated proviso to Section 1(1). We can therefore repeal the proviso by Clause 2(6).
  The second main feature of the Bill relates to countries with centrally-planned economies, Clause 3(2). Dumping exists when goods are being exported to Britain at prices below their fair market price. To determine the fair market price under the present Act, the Board of Trade normally has regard to the domestic
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  selling price of comparable goods in the country of origin. Failing this, they fall back on the cost of production or the price of that country's exports to a third market. None of these methods is really satisfactory for countries with centrally-planned economies since they operate artificial and sometimes multiple exchange rates and their export prices do not necessarily bear any relation to domestic costs.
  We are, therefore, seeking discretion in this Bill to use another method for establishing the fair market price for goods from these countries. This is by reference to the price of similar goods exported to the United Kingdom by another country, normally a market economy country, with appropriate adjustments to make the comparison a fair one. Such a comparison is substantially the same as the one the Board of Trade already make when considering complaints from our industry against low-priced imports from Eastern area countries in the context of our bilateral trade agreements with some of these countries. These agreements reserve to us the right to impose quota restrictions in certain circumstances. The new powers will make it easier for us to protect by means of anti-dumping duties British industries that make out a case for action. Such duties are more in keeping with current trends in our trade with Eastern area countries than the quota restrictions which are now being progressively eliminated.
  I should make three points clear. We shall normally wish to have reference to the lowest but still representative un-dumped price of comparable goods from a market economy country. Secondly, in accordance with our practice ever since the 1957 Act was introduced, we shall normally continue to apply the material injury criterion to non-G.A.T.T. countries. This is because it would be unwise to interfere with trade by anti-dumping measures unless the dumping was in fact causing or threatening material injury. Thirdly, while we hope that these new powers will benefit aggrieved industries, we shall of course also need to continue to have regard to our general trading relations with the Eastern area countries concerned. The other changes proposed in Clause 3 are minor adjustments only and can best be dealt with in Committee.

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  Finally, Clause 4 of the Bill. Under the present Act, we have powers, subject to the negative Resolution procedure, to reduce or revoke anti-dumping or countervailing duties but not to suspend them. It may happen that, when an Order imposing a duty is in force, conditions change so that, for example, the balance of national interest may be temporarily altered against the duty. Or there may be changes in the supply and prices of imported goods which affect dumping or material injury in ways which leave it unclear whether and for how long the new conditions will persist. In such cases, it would be useful to have powers to suspend the duties for a comparatively short period and to end the suspension as soon as the change in conditions is reversed, without the need for full reinvestigation. We do not expect the period of suspension under Clause 4 to be more than a few months as a rule and never more than 12 months.
  I hope that, with these explanations, the House will pass this small but useful Bill.
  7.20 p.m.
  Mr. Patrick Jenkin: The House will be grateful to the Parliamentary Secretary for her very full and lucid explanation of the Bill which, as she said, is a small Bill. However, although its scope is limited, it represents an important extension of the powers of the Board of Trade to ask Parliament for Orders to protect British industry and agriculture against dumping. We tend to concentrate more on the industrial aspect, but I believe that the agricultural and horticultural aspects are no less important.
  Even though the Bill is relatively limited, the House would be right to view it in the context of the general world trade situation. I hasten to echo the words of the President of the Board of Trade when, at the end of the questions which followed his statement on the proposed acceleration of the Kennedy Round, he declined to go so wide on the subject that, as he said, it would mean starting a general debate which would last for hours. I do not think that anybody wants that on this Bill, and I therefore will do no such thing. But it is right to make two or three relevant points by way of introduction to the Bill.
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  As the hon. Lady said, the Bill is the direct result of the inclusion in the Kennedy Round of Annex D, which is the anti-dumping code. The Kennedy Round was the sixth in the series of G.A.T.T. conferences which have taken place since that body was set up and it represents a notable milestone in the development of international trade, leading, as we hope it will, to a remarkable liberalisation of world trade. The talks which ended last June were, in this context, unique in their scope and complexity and in some respects represented a major departure from what had gone before in that much more attention was given to non-tariff barriers—of which, in a sense, this is one example—and to agricultural trade and the economic problems of developing countries.
  Although those were formidable tasks for the negotiators, it is a matter of congratulation that they found time to reach agreement on what is a relatively minor matter in the context of the whole agreement—the detailed rules spelling out the implementation of Article 6 of the original G.A.T.T. treaty, which dealt with dumping and subsidies. It is right to pay tribute to the officials—both male and female—of the right hon. Gentleman's Department, who made a notable contribution to that progress. That has been well recognised in industry and it is right that that tribute should be paid.
  Secondly, the main intention of Annex D was not to enlarge the protection which the anti-dumping code gave to the nations but to define it and in some cases to restrict it. Without doubt, some countries have interpreted Article 6 in a broad and liberal manner, and exporters from Britain have found themselves facing an interpretation of the antidumping provisions which differed markedly from the rather more restrictive interpretation in force in this country. For that reason the form of the agreement was necessarily restrictive. But the Bill which we are considering is for the most part enlarging.
  It is right that the form of the agreement should be restrictive because Governments need no encouragement whatever to indulge in protectionism of one sort or another. The pressures are always there. When I was in the United States I met some of this pressure in the steel and textile industries, and I

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  realise what we are up against. It is right to resist those pressures. They exist, but in many cases they are being effectively resisted. I quote one statement made on the subject by the President of the United States:
  "Protectionism is rearing its ugly head in the form of certain quota Bills now before Congress, trying to take care of each Congressman's district, and when we begin to think more of our districts than we think of the country we are likely to get into trouble."
  This is a phenomenon to which we are not wholly strangers in this country. Perhaps some of the speeches which we shall hear later in the debate will be evidence of similar pressures here. But it is right from this House to welcome the President's statement and the very strong resistance which the whole American Administration put up to the proposals which were before Congress last autumn. No pretext is more plausible or more respectable to back up a case for protectionism than an allegation of dumping.
  It is for this reason that it is necessary to define extremely narrowly the conditions in which an anti-dumping duty may be applied. It is also right in this context to say that this country has no need whatever to stand in a white sheet. Our record is one of strict, some argue unnecessarily strict, interpretation of Article 6. So it is that in the Bill we find that the provision is enlarging. Two points to which the Parliamentary Secretary referred expand and widen the powers of the Board of Trade to impose anti-dumping duties. In a sense it is unfortunate in that the first step which the Government and the country are to be seen to be taking publicly in the implementation of the Kennedy Agreement is a slight—it is a very slight—permitting of additional restrictions on trade. But I believe that the President of the Board of Trade has given us sufficient prophylatic as a protection against any such accusations by what my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) described as the constructive initiative which he announced on 14th March. Rather the Bill should be regarded by other countries as a measure of the self-imposed restraint which we in Britain have hitherto put on the use of Article 6 of the G.A.T.T. agreement.
  My third point is that it could be argued that the changes are justified on
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  their own merits to bring United Kingdom law into line with the international convention on dumping. But I believe that it goes further than that. It must be seen to be part only of the wider agreement reached at Geneva, and acceptable only if regarded as one element in the whole convention signed by the parties last year. It is important that other countries should not see the Bill merely as evidence of an eagerness on the part of the United Kingdom to seize an opportunity to raise new barriers, but rather should regard it as an earnest of our intention to fulfill the whole agreement.
  The truth is that anti-dumping becomes important only as tariffs and restrictions of all sorts are lowered on the movement of goods. Therefore, far from being a protectionist Measure, as some might seek to represent it, I believe that the Bill can be taken as a guarantee of our wish to fulfil the full terms agreed in June last year.
  It is not always easy to persuade industrialists and trade unionists that freer trade and tougher international competition is, and must be, in our own long-term interests. Yet that must be true. It is entirely right that, at the same time, we should be able to assure them of adequate protection against what is, basically, unfair competition, which is what dumping represents. This is really the basic justification for a code of antidumping practice.
  I turn now to the Bill. The hon. Lady suggested that it was foreshadowed in the National Plan, but the reference to it was a bit vague there. The first real indication we heard that the Government had actively under preparation a Bill of this kind came when the President of the Board of Trade wrote to Mr. Lewis Wright, the General Secretary of the Amalgamated Weavers Association, on 28th September, 1967, after a delegation had waited upon him and had put to him their grave fears about threats to the textile industry. Dumping had been the subject of one of their complaints, and in his letter the right hon. Gentleman assured the Amalgamated Weavers Association that the Government always stood ready to take effective action against dumping. He ended that paragraph by saying:
  "Meanwhile, the Government is pushing ahead with a new Anti-Dumping Bill."

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  That was the first any of us had heard about it, and I made it my business to find out whether anything else had been said. But no; that was the announcement to the world that a new Bill was forthcoming—a strange place to find such an announcement, but none the less welcome for that.
  The hon. Lady explained the details of the Bill in the simple and unvarnished prose we have come to expect from her. As she said, two main changes and a lot of minor improvements are made. The first main change is that, for the first time, there will be power to impose a provisional duty, there having been power hitherto to impose only a retrospective duty. The second deals with the question of determining fair market price in Iron Curtain countries or countries where there is essentially a controlled economy.
  There can be little doubt that the severest weight of criticism against the Board's administration of the existing Act has been directed to the damage which can be done, and undoubtedly has been done, by the dumping of imports during the period of investigating an allegation of dumping made by an industrial or commercial interest in this country. This has certainly applied where specialised high-value commodities have been dumped. It is relatively easy to forestall, to use the Parliamentary Secretary's own word, by bringing in quantities sufficient to last for two or three years, thus substantially defeating the object of the anti-dumping duty. It has applied also to seasonal goods in many sections of agriculture. By the time the allegation has been made out, the whole purpose of it has passed and the damage has been done.
  In some cases, one has had just a continuing pattern of importing, which has been bad enough, but in other cases there has been a deliberate attempt to anticipate the effect of the anti-dumping duty by getting the goods in before any order could be made. In this way, the delay—necessary delay, perhaps—in the course of thoroughly investigating an allegation, has entirely defeated the purpose of the application and irreparable harm has been done. In such circumstances, people in industry have felt that the Act has entirely failed in its purpose and have been pretty cynical about it.
  880
  The reason has been that the 1957 Act was interpreted by the Board of Trade very narrowly. The Board has always interpreted the word "satisfied" as meanning "completely satisfied", and room for a prime facie case, which the hon. Lady mentioned, was never allowed. Other countries have applied far less stringent conditions. They have readily applied provisional duties, they have suspended appraisal, and have undertaken all the devices which have enabled them to delay entry of the goods subject to an application.
  Some years ago, representations on this subject were made by people in industry and in agriculture, and it was right that the Government should act. We now have Articles 10 and 11 of the Convention spelling out what is permissible. However, I have one or two points to make about this, as it is an important matter. Article 10(a) reads:
  "Provisional measures may be taken only when a preliminary decision has been taken that there is dumping and when there is sufficient evidence of injury".
  In the Bill, there is a greater divergence than that, if I may so call it, in the burden of proof required of an applicant. Clause 1(2) has the words,
  "…if at any time it appears to the Board of Trade, on the facts so far before them, that the conditions of section 1(1)(a) or (b)…are fulfilled".
  When one turns to material injury, on the other hand, one finds different words in Clause 2(3):
  "…a provisional charge to duty shall not be made unless the facts so far before the Board of Trade indicate that the effect"
  is such as to cause material injury.
  Do those differences in wording imply a difference in the burden of proof? There is no such implication in Article 10(a) of the Convention, yet it is quite possible that, following a test similar to the one I mentioned a moment ago—that "satisfied" must mean "completely satisfied"—the Board of Trade will tend to interpret those two requirements, one regarding dumping and one regarding material injury, as calling for a different burden of proof, as justified by the difference in language. Perhaps the Minister of State will deal with that in reply.
  The Parliamentary Secretary referred to the last few words of Clause 1(2),
  "in the circumstances it is expedient to impose such a charge".

  881
  She did not make entirely clear the circumstances in which a provisional duty would be refused on the grounds that it was not expedient. She told us that, where there was any question of forestalling or where there was any question of seasonal goods, a provisional duty would be imposed, and for that we are grateful. But is that as far as it goes? Are not the Government prepared to have regard to imports coming in at a continuous rate, with no evidence of an accelerated rate such as might justify a charge of forestalling but which, nevertheless, could do irreparable damage to the firm as a result of the dumping ultimately proved.
  What are the factors which will weigh with the Board of Trade in deciding whether it is expedient to impose a provisional charge? Dumping and material injury must be prima facie established, but the Board of Trade has limited its own power to make a provisional order by the use of the word "expedient". I mean no disrespect when I say that the Minister of State must go a little further than the hon. Lady did in explaining how that limitation is to be interpreted.
  The retrospective duties imposed—strangely, they come in subsection (1), and the provisional duty is covered by subsection (2), and one might have thought that it would be the other way round—are a little obscure, but the case seems to be this. Let us suppose that a provisional duty of 5s. a pound is imposed. After investigation, it is found that a duty of 6s. a pound would be appropriate. The Board of Trade is limited as regards the retrospective period to 5s. a pound. On the other hand, if the figures are the other way round and 6s. is imposed as a provisional duty but, in the event, 5s. a pound is charged, the 5s. a pound stays for the retrospective period as well.
  Mrs. Gwyneth Dunwoody: One shilling would be repaid.
  Mr. Jenkin: The hon. Lady says that it would be repaid. There is no provision in the Bill for payment; it is merely a bond. Perhaps that word ought to be in inverted commas, but I see what she means. In each case, it is only the lower rate of duty which can
  882
  be applied to the period before the making of the final order.
  This new power is welcome. It brings us into line with the international Convention and puts us on a parallel with other countries which have in the past operated the existing powers rather less stringently than we have. As other countries bring their laws into line with the Convention, reducing the liberality with which they have interpreted G.A.T.T. provision, that will in turn help our exporters.
  The second main change is the determination of a fair market price where the country of origin operates a centrally controlled economy. There have been two difficulties. First, such economies do not operate on a market basis, and therefore there is no market price in the sense that we understand it. Second, as the Parliamentary Secretary said, exchange rates are often highly artificial.
  There is the further difficulty of establishing any sort of cost information that means anything. Perhaps this is best illustrated by a case about which I have had correspondence with the Board of Trade, concerning allegations of dumping Russian watches. I have seen the Board of Trade trying to grapple with the problems of investigating a wave of dumping from an Iron Curtain country.
  The right hon. Member for Sheffield, Hillsborough (Mr. Darling), whose departure from the Front Bench opposite many of us on this side of the House sincerely regret, dealt with this in a letter to me on 24th April last year. Because it sets out so clearly what the Board of Trade's practice is, it might be right to read it to the House. He said:
  "We normally prefer…in such cases the easier and quicker course of considering any allegations of disruptive trading in the context of our current import quota arrangements with the country concerned.
  In considering such allegations, we base our decision on a comparison of the landed price, not including duty, of the goods about which the complaint is being made, with the ex-works prices of comparable British products and the landed prices of comparable goods imported from other market-economy sources."
  That practice is almost exactly what the Bill now proposes should be made statutory. Apparently the Board of Trade has had no difficulty in applying such a procedure in the past without statutory authority.

  883
  The right hon. Gentleman went on to explain that often in international trade negotiations there are great advantages to be got for British exporters by agreeing to quotas of goods, even though they may be coming in at dumped prices. But he added:
  "The inducement in terms of improved opportunities for British exports will have to be very substantial before we shall feel able to agree to any further concessions on watches for the Soviet Union, so long as doubt remains about the fairness of their prices."
  That was a very fair statement.
  The British industry thereupon tried to give an indication of what would be the cost of Swiss and United Kingdom watches and the prices that must have been charged for comparable Russian watches on their import. The figures are very striking. Let us take the movements, leaving out of account the value of the case. The Swiss movements were thought to be about 38s. each, and the United Kingdom movements 33s. 10½d., whereas the Russian movements were only 12s. That shows the measure of the margin between the comparisons which the right hon. Gentleman wrote that the Board of Trade was making and the imports.
  The right hon. Gentleman wrote again on 9th June:
  "ߪRussian watches and movements are coming into this country at prices that are substantially less than those of comparable Swiss watches, or the cost of production of comparable British movements. This gives us a basis for pursuing the matter further with the Soviet authorities, which we intend to do shortly."
  This the Board of Trade did, but it got nowhere. All information from the Russians on costs was refused. So, to the surprise and chagrin of the industry, in January the quota for Russian watches was increased by no less than £100,000. Yet earlier the right hon. Gentleman had admitted that the goods were being imported at prices substantially lower than those of comparable Swiss or United Kingdom watches.
  I apologise for having described this instance at some length, but it clearly illustrates the difficulties in such cases.
  Mr. Mapp: I think that I am right in thinking that watches are manufactured in the hon. Gentleman's con-
  884
  stituency, though I may be wrong. In any case, his argument is in effect that Russian watches are coming here at prices substantially lower than those at which we can produce them or import them from Switzerland. Is the hon. Gentleman arguing from this that there should be special arrangements to deal with this problem, because so far legislation has not dealt with this point, as far as I know?
  Mr. Jenkin: The hon. Gentleman has anticipated the point I was about to make. Perhaps I should reassure him. As far as I know, I have no watch manufacturers in my constituency, and I am not guilty of those district pressures to which the President of the United States referred in the excerpt from his speech which I read a short while ago.
  I believe that this case illustrates the limited value likely to be obtained from Clause 3(2), because that provision appears to have been exactly what happened in the case of the Russian watches, and yet the Board of Trade thought it right to increase the quota from £400,000 to £500,000 a year. I can well understand the indignation and sense of helplessness which the industry felt when it was confronted with that information.
  The only thing that this new power does is apparently to provide a short-cut assessment of costs. What we are entitled to require, not ask, of the Board of Trade is that the power will be used, if dumping of the sort I have illustrated in the case of Russian watches is shown, as was admitted by the right hon. Gentleman. We require that an anti-dumping duty shall be imposed, and that the interests of one British industry shall not be sacrificed to those of an entirely different British industry—in the case 1 have mentioned it was to be clothing and footwear—in an attempt to increase bilateral trade with Iron Curtain countries. We shall not convince industries that trade is fair where that sort of thing is done and no action is taken.
  It will be necessary to interpret the provision about "identical or comparable goods" with a reasonable degree of flexibility, but once the dumping has been proved, it is essential that, provided material injury is also proved—and the Board of Trade has always said that it requires this—the duty is imposed, The

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  Board of Trade should not take refuge in the hope of increasing bilateral trade agreements of this sort. One should not adopt towards this matter an unduly timid or legalistic approach. The Minister of State must say how the Board of Trade will in future operate the provision and give some indication to industry that there will not be a repetition of the kind of handling of the matter we have seen in recent months.
  Finally, I have two general points about the Bill. Perhaps I should again make perfectly clear the question I put to the hon. Lady while she was making her speech, because it is a point which many industrialists find very puzzling. The G.A.T.T. rules require not only that dumping should be proved but that material injury should be proved. This does not apply to countries which are not members of G.A.T.T., and yet the Board of Trade has apparently always required the same burden of proof of material injury in respect of dumping from non-G.A.T.T. countries as it has in the case of dumping from G.A.T.T. countries.
  To the extent that other G.A.T.T. countries apply different rules and draw a distinction in respect of where the allegedly dumped goods are coming from, that has put British industry at a disadvantage. The Minister of State owes it to the House to explain why there should be this, as it were, voluntary imposition of an additional restriction on the operation of the rule. Is the onus as stringent as many industrialists believe it is? Perhaps there is a case here for requiring the same evidence of injury, but not going as far as the G.A.T.T. requirements indicate.
  The second point is about agriculture and horticulture. I put it with great hesitation because it is a subject on which I cannot claim to speak with any authority, having not a single farmer in my constituency. We must recognise that in this sphere an anti-dumping duty may in itself not be enough to achieve the stabilisation in the home trade that we all wish to see. I believe that the effective answer to the large quantities of dual priced goods which are coming or are threatening to come into the market and engulf or swamp it must be that we should go over to a full-scale system of import levies. I leave it to those of my
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  hon. Friends who have much greater knowledge of the matter than I have to elaborate on that, and merely assert that in the context of agriculture I do not believe that the Bill will solve the problem. At best, it is only half a safeguard.
  The Kennedy Round marked a big stride—not perhaps a giant one—in the growth of international trade, and it has been followed by a number of constructive initiatives both by this country and by the Common Market. It all now depends on the United States, and we are awaiting and watching with great interest what happens there. The forces of protectionism are undoubtedly very strong. On the other hand, there are those who see the danger. Meanwhile, the United Kingdom is taking a leading part in the start on the elimination of non-tariff barriers. We have always operated the dumping code strictly. The Bill should not be taken as an indication that we shall cease to do that.
  With that, I can say that we welcome the Bill. We shall examine it in detail in Committee, but see no reason why it should not be given an unopposed Second Reading.
  7.52 p.m.
  Mr. Charles Mapp: I have listened with great care to the contributions on both sides. The contribution by the Parliamentary Secretary was more or less as I had expected, but one comment stuck in my mind and about which I am concerned. She said, in effect, that the main difference that the Bill brings compared with the practice of legislation previously is that it confers wider powers in respect of provisional powers. I accept that, but if that is the march of progress I am sorry that it is not a little quicker.
  I am concerned about the administration of this legislation-to-be. The hon. Member for Wanstead and Woodford (Mr. Patrick Jenkin) had a wonderful detachment about the rôle of the policeman. But the policeman in this case is Britain. I expect that policeman to deal with what are trading offences in the way that a policeman should.
  I also noticed that the hon. Gentleman identified a case of importation at less than the market price from an Iron Curtain country. But he did not think

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  of dealing with the same problem in respect of trade with the rest of the world. I have a feeling that later in the debate he will not be supported in regard to the agricultural industry—he made that caveat himself—nor will he be supported by the industry in the North-West which has been pretty well crucified over a number of years.
  My view is that industries of that kind—I am not unknowledgeable of the claims of the agricultural industry, having been born in the countryside—are entitled to the protection of the policeman. In a number of instances we feel that the policeman has lacked powers or in some cases lacked vision to see what has been happening.
  I want to trace for the House how the Bill comes before us. I think I should not be out of order in referring to Command Paper 3347 of July last year, which says, in paragraph 32, on page 14:
  "For example, the Code requires that applications for anti-dumping action must be supported by evidence of material injury to domestic producers."
  I want to develop what injury is and who domestic producers are, and I also want to refer to the users of dumped materials.
  I was surprised—though it is in alignment with the speech from the Opposition Front Bench—to notice that paragraph 33 says:
  "It will not be necessary to amend United Kingdom legislation in order to comply with the Code."
  But here we have amending legislation, and from the contribution by the Parliamentary Secretary I can only think that the amending legislation is to deal purely and solely with the provisional powers that seem to be necessary.
  The White Paper goes on to describe in some detail, in effect, what will be the background to this Bill, and it is in the light of that that I want to comment. Article 2, on page 38, headed "Determination of Dumping", says that for the purpose of the code a product is to be considered as being dumped if it is
  "introduced into the commerce of another country at less than its normal value, if the export price of the product exported from one country to another is less than the comparable price, in the ordinary course of trade, for the like product when destined for consumption in the exporting country."
  888
  So we are here back to the problem of a like product.
  Over the last 12 months an undue quantity of yarn has been imported into this country. I have found out how it has happened. Most of the evidence that I have been able to find shows that the kind of yarn as produced in Portugal—it has now fallen away—and that the materials ultimately made from that yarn are not normally saleable on the Portuguese market. Therefore, the next problem is: what is a fair price to determine the market position?
  To take the matter a little further, this yarn was derived from raw cotton grown in the Portuguese colony in Africa. The Portuguese Government have made special financial arrangements which involve the growing of raw cotton in Africa for export to Portugal, and these represent a built-in subsidy. This seems self-evident to the traders in Lancashire and it is self-evident to me, but the problem of proving this kind of thing is a matter of the vision of the policeman and on the side of whose law he is operating.
  A good deal of evidence was produced to the Board of Trade from the industry as a whole. The flow of that traffic has largely reverted to normal now. I will not go into detail about how that has happened, except to say—I put this point very pertinently to the Minister—that I believe it was the case that another E.F.T.A. country was subject to the same excessive import flow from Portugal as ourselves and the traders in that country threatened to take the abnormal importation of the material to the courts. It was felt that the Portuguese Government were a little unsure whether a case could be sustained against them. This synchronised with the British Government's action. I am not happy that this horse-trading should take place. Dumping is either established or it is not. Lancashire thinks that there has been a large measure of dumping in recent years.
  As distinct from machinery, moto cars, and 99 per cent. of the things that we use, imported textiles do not show their precise origin. Nobody is able to identify from the article itself what its origin was. The Shirley Institute, in Manchester, was recently asked if its scientists could decide the origin of an article. It was unable to make any conclusive statement about the country of

  889
  origin. Lancashire is interested in the Bill and it will be disappointed if the result is that provisional powers are taken and nothing done about the general position.
  In Article 2(a) and 2(b) of Cmnd. 3347 there is a determination of what constitutes dumping. In Article 2(b) the words are "like product". What are like products? As I proved in the case of Portugal, it is unlikely that they are products like those which might be required in the sophisticated British market. There is little market in India and Pakistan for the textiles from those countries which reach Britain.
  What is "injury"? The Lancashire trade has for long been upset because the industry, through its central body, has not been recognised as the party producing evidence of injury. We have often had to return to one producer. In an industry which is widespread and probably over-fragmented, how can a trader in Burnley, Oldham or Bolton, who is concerned merely with his own product, establish injury to himself? He knows that the yarn industry extends right across the North-West. His own injury may appear to be minimal, but over a period of time there may be a loss of confidence not only in him but in the industry generally and his chances of being able to obtain finance to expand will be small. He will be more likely than not to be open to a take-over or face bankruptcy.
  It is all very well for hon. Members representing affluent parts of Britain who have not to deal with problems of declining industries to talk in idealistic general terms. I do not assert that we want the policeman to stop the process of rationalisation in the textile industry. Rationalisation there will have to be. All we ask is that, if it has to be rationalised, the rules of cricket on the importation of the industry's main raw materials should be reasonable and we should not have to face dumping as we know it.
  The Minister mentioned a Canadian experience, which was apparently referred to in the Geneva discussions. This experience was within the knowledge of the Cotton Board two or three years ago. Allegations were made about it, but we were unable to produce the kind of evidence which the hon. Member for
  890
  Wanstead and Woodford said was necessary. Since then, it has apparently been established. With the setting up of the Imports Commission, there is now much better policing. It required an expression of opinion on both sides of the House to enable us to reach the stage when that policing is taking place, but even more policing is required.
  The Trade Descriptions Bill will, if enacted, enable dumping to be more easily identified. Over a period of time we knew of textiles passing from Eastern countries to Canada and being absorbed in the Canadian market at Canadian prices and an equivalent amount of Canadian production being sent over here at Far Eastern prices, or with only a small margin to make the business worth while.
  Both sides of the industry in Lancashire—the hon. and learned Member for Darwen (Mr. Fletcher-Cooke) will support me in this—want to ensure that the Bill, small as it may be, will do a job. I want to be sure that the industry will be recognised and respected as able to make charges about dumping. If I thought that the position would be that individual firms had to make charges about dumping, I would vote against the Bill tonight.
  Greater use should be made of our commercial representatives abroad so that we know what is happening overseas. Sometimes it falls to me and to some hon. Members opposite to get information about what is happening overseas, information which appears not to have been gathered by our commercial representatives. For instance, last June the Australian Government declined to accept Hong Kong shirts on the ground that the price was subnormal. The hon. Member for Wanstead and Woodford argued the same thing about Russian watches. Regardless of whether it is the Russian Government or entrepreneurs in Hong Kong, India, Pakistan or Canada, if Britain allows our industry to run down and become a ready-made market for the world's operators it is obvious that the places I have mentioned will so arrange their production that this velvet cushion can absorb what they produce.
  What are price undertakings in this context? In business, a price undertaking means that if one is a good boy one will

  891
  be paid X for a period of time. I regard price undertakings as nothing more than an interim price until such time as more permanent arrangements are made. They are useful so long as there is controversy, but they often lose their validity when the controversy ends.
  Provisional duties can be arranged if dumping has been proved, but in Lancashire there have been one or two recent examples of stuff coming to Salford or Liverpool docks and being taken over by the Customs people and sold on the British market. I understand that provisional duties will obviate that. Hitherto, the British market has had to absorb these imports and, incidentally, the Government have been the means by which these imports have been absorbed. If necessary, they ought to be sent back. All I am asking is that the policeman here should do his job.
  Some time ago, the Chancellor of the Exchequer took notice of the world's opinion about our export rebate scheme and withdrew it, presumably because we were open to some objection about dumping. On the other hand, I gather that if the United States becomes more reactionary about certain tariffs, this weapon might be taken back into our armoury. This is a long way from proving dumping in the strict sense with which we have been concerned this evening. I have quoted examples from Canada, Ireland and Portugal, but there are hints of a great deal of dumping from Austria.
  Both sides of the textile industry in Lancashire would like some assurances. They would like to be assured that the civil and Customs service in this country are fully alert to the present problem and to the opportunities which the Bill will confer. They want close and understanding contacts between their representatives and the Government. British industry should not be asked to prove dumping 101 per cent. After all, to some extent this is a matter of looking after the interests of the country as a whole, and the Government ought to be disposed to act sympathetically not only for the textile industry, but, later possibly, for agriculture and horticulture.
  I hope that my right hon. Friends are alert to these problems. There is the great problem of rescuing the textile industry. It must be improved in a number
  892
  of ways, including reorganisation, but many incidental things would be helpful. One of them would be for the Government to deal with dumping vigorously. Another is to improve trade marking, and progress in that direction is likely to be recorded.
  I hope that the Minister of State will take account of the apprehensions of the textile industry and make sure that the Bill provides the necessary powers. However, the most important thing is not legislation as such, but the application of drive and vigour in its administration where it matters.
  8.15 p.m.
  Mr. R. J. Maxwell-Hyslop: I welcome the Bill as far as it goes, but I find it disappointing in a number of respects. Successive Presidents of the Board of Trade, irrespective of party, have completely deformed the 1957 Act. The hon. Lady the Parliamentary Secretary peppered her speech with references to applicants making out their case to applicants proving this and satisfying the Board of Trade that. Nowhere in the Bill is there anything about applicants. This is an entire hallucination imported by successive generations of Presidents of the Board of Trade. They have quite deliberately turned an intransitive into a transitive verb. They have turned an obligation on the Board of Trade to satisfy itself into an obligation on mythical applicants to prove a case to the Board of Trade.
  The only reference to applicants in the 1957 Act is in Section 3, which says:
  "If on an application so made the Board of Trade are satisfied that the export price of the goods in that country with the amount of the duty added to it exceeds the fair market price of the goods in that country, the Board shall notify the Commissioners of Customs and Excise of the amount of the excess, and the Commissioners shall remit or repay the duty up to that amount."
  There is nothing in the Bill about applicants. It is unforunate that there should be imported into this new Bill an old bad habit, the bad habit of the impotent Board of Trade incapable of reading the figures which it publishes itself about what is going on, so that unless some applicant to whom there is no statutory reference draws its own attention to its own figures, it exists in a state of ignorance of them. I find this profoundly distressing, entirely unnecessary and completely avoidable.

  893
  When, over the years, hon. Members from either side of the House have drawn examples of dumping to the attention of Board of Trade Ministers and have given evidence of it, time after time Ministers have said that they have not had an application for an anti-dumping duty from somebody representing the industry affected. But there is no statutory necessity to have such an application. When the facts are presented in the House, the Minister retires behind the mythical defence that he has no power to act until the applicant proves a case.
  I hope that the Minister of State, for whom I have the greatest respect, will nail this one for good and all and will say that when the Bill is passed, as I trust it will be, he will enforce the Act and will not surround himself with restrictions which he has not put into the Bill or asked the House to accept.
  Mr. Gordon Oakes: I agree entirely with what the hon. Gentleman says. Would he agree with me that Ministers have a further get-out when they say that if Members will supply them with evidence of the dumping, they will take appropriate action? How can any hon. Member know the conditions prevailing in a given country? It is the duty of the Board of Trade to know that.
  Mr. Maxwell-Hyslop: I entirely agree, and I am most grateful to the hon. Gentleman for emphasising that. No one is or should be in a better position to know what is going on in another country than the President of the Board of Trade and his Ministers. If he does not know what is coming into the country, he should sort out his Department, because it is not doing its job properly.
  I agree that many statistics are inadequate. For instance, there is the fact that the Board of Trade does not know—it claims that it does not have the figures—what is the export-added value ratio for various classes of manufactured goods. I asked a Question about this last week when it was claimed that the Board did not know. I do not know what could be more important to know than that.
  For heaven's sake let us keep this as the Bill says it is, an intransitive condition. The Minister must be satisfied—no one else has a duty to satisfy him. I hope that the Minister of State can give us that
  894
  assurance. The second omission which I hope to see rectified is the question of material injury to the taxpayer who, believe it or not, exists. It is a ground for imposing anti-dumping duty if the material is being exported at an artificially low price and if material injury is caused or threatened to established industry, or is such as to retard materially the establishment of an industry in the United Kingdom.
  What about the poor taxpayer who may suffer as a result of dumping? In many areas of agriculture, we still have a deficiency payments system. If the average market price, on the rolling average, is such that a subsidy is currently being paid, then the initial effect of dumping, by depressing prices, would be to injure the taxpayer, because it is the taxpayer who will then face a Supplementary Estimate as a result of the unexpected subsidy that has had to be paid. Yet there is no provision here to protect the taxpayer against material injury, actual or threatened. That is something which I, and, I hope, all Members, would welcome.
  I would not have it thought that because it is the taxpayer who suffers the initial injury as a result of dumping where there are rolling average deficiency payments, the British agricultural industry does not suffer, too, in the long run. Of course it does, particularly under the standard quantity system, because it tends to have its standard quantity reduced at the next Review. That is always very much more remote and the temptation to the Minister, when faced with Polish eggs pouring into a country which is already producing more than 99 per cent. of its own fresh egg consumption is to say, "Ah well, there is a deficiency payments system, so it does not do material harm to the industry." We know that it does material and long-term harm to the industry, and it also does material harm to the taxpayer. It is a legitimate interest of Members who do not represent farming constituencies, because we certainly represent taxpayers.
  To what extent does the Bill apply equally to Crown Colonies and Protectorates as it does to foreign States? I am sure that there is an easy answer to this, but there would be merit in placing on the record whether there is any diminution in its effect, between Crown Colonies4

  895
  and foreign States. I welcome the Bill because we all know how difficult it is to establish the representative price of a commodity produced in a country which does not have a normal market system, or where that system is distorted by rationing of one kind or another. The Bill goes a considerable way to untie the Minister's hands in that respect.
  Finally, I exhort the Minister of State to pay more attention to anticipating injury, rather than waiting until the injury has occurred. We have to undo the injury done to the British producers, whether agricultural, taxpayer or whatever else. One will not undo the damage subsequently, by putting an import duty on dumped produce. One does not undo the damage caused to industry, which can include the shattering of confidence in its long-term development, in this way. It is not undone by waiting until the injury is caused and then putting on an import duty.
  For these reasons I welcome the Bill as far as it goes, but I hope that the Minister of State will give serious consideration, before the Committee stage, to strengthening the Bill in the ways that I have suggested, first of all by stating publicly that this myth about applicants having to satisfy him is indeed a myth and is dead and buried in this House tonight. Secondly, he should make it quite clear in the Bill—and this would necessitate the addition of a subsection—that material injury to the taxpayer because of our subsidy system would also fulfil the second requirement which is necessary to impose anti-dumping duties. With those comments I give a hearty welcome to the Bill.
  8.25 p.m.
  Mr. George Lawson: I have to say right away that I have a constituency interest in this Bill, and I make no pretence about objectivity, such as the hon. Member for Wanstead and Woodford (Mr. Patrick Jenkin), although I can be as objective in matters of this kind as most others. I represent a constituency where a very large number of alarm clocks are made. They are not made solely in my constituency, but in practically only two areas of the country.
  It is interesting that this industry, together with the watchmaking industry,
  896
  was brought into existence as a result of wartime experiences, when we had virtually no such industry. In an earlier day we made watches and clocks, but had virtually lost the skill, and special efforts were made to establish an industry here, to put Britain in a position where it was not so completely dependent upon foreign sources as we had come to be. The industry has been in serious jeopardy because of the unregulated dumping going on over a considerable period of time. I see my hon. Friend the Member for Brecon and Radnor (Mr. Tudor Watkins), and I am sure that he wants to say something on this.
  Since early 1963, together with my hon. Friend the Member for Dunbartonshire, West (Mr. Steele), who has another of the clock-making industries in his constituency, I have on a number of occasions approached various Board of Trade Ministers on this problem. Our experience was always that the onus was thrown upon the complaining firms to produce evidence. We were subsequently told that the firm need not prove it absolutely, but that evidence should be submitted sufficient to establish at least reasonable ground for the contention. Then it would be investigated. But any evidence which came to my notice did not satisfy me that those investigations had been carried out with the thoroughness which I should have expected of our country in a matter of this kind.
  There was one occasion—in fact, it was about the only occasion—when a substantial piece of evidence was brought to my attention of the kind requested by the Board of Trade. This evidence was produced by trade union officials who went to an East European country and sought to discover what was happening. They had to do a fair amount of guesswork, but the guesswork seemed to me, and to others who knew about these things in this country to be fairly sound. The union of my hon. Friend the Member for Paisley (Mr. John Robertson), although clocks are not manufactured in his constituency, was very much involved in this matter. The general secretary of the A.E.U. sought to produce evidence on it. It seemed to me rather absurd that our country could do nothing unless private individuals produced evidence of dumping, and yet that was repeatedly the situation which we found.

  897
  I remember my right hon. Friend the Member for Sheffield, Hillsborough (Mr. Darling) saying to me that the law in this connection was no good; it was rotten. But what was said in the letter which the hon. Member for Wanstead and Woodford read surprised me because it did not fit in with our experience—and I say "our experience" because I was not alone in this—in trying to have something done to protect an industry which seemed to us to be in serious jeopardy.
  One could expect no private concern, or even a group of private concerns, to be in a position to get the information which our Government could obtain. The issue is not free trade versus protection, as perhaps it used to be in the past. Governments are competing with Governments, countries are competing with countries, and there can be no doubt that in most, if not all, countries a variety of means are found to push the business interests of those countries. Many of those means are not fair if we measure them by what we would customarily consider to be fair.
  I recognise that this nation, perhaps more than any other, lives by trade and that we must be fair. Nevertheless, need we be more than fair? Need we bend backwards always to be so scrupulous that there can be no pointing of the finger at us? My impression has been that those to whom I have spoken—Ministers and those advising Ministers—have been concerned about doing nothing which could result in criticism of this nation. That is all very well if other nations do the same.
  My hon. Friend the Member for Oldham, East (Mr. Mapp) talked about a policeman. It is no good having a policeman for one country unless other countries do the same; or if other countries do not do the same, our policeman should be informed and should be prepared to take any necessary action. I do not suppose that we shall ever be able to stop these things, and I am all for any liberalisation that can be achieved, but it must be done on the basis of "or else".
  Governments and nations are involved in this matter. Governments are trying to strike bargains and to reach agreements on fair practices. It is no good saying, "We will observe the agreements of G.A.T.T. and bind ourselves to 100 per cent. observance of those agree-
  898
  ments" when we know it is not being done elsewhere. This becomes a bargaining question. In the past—and I hope that in future this situation will change—if the trade unions merely argued a case without having any power to their elbow, namely, the right to withhold their members' labour, in most cases they got nowhere. If we insist merely on arguing, and allow all sorts of practices harmful to us to be engaged in, we shall get nowhere. We should be ready, if the occasion demands, to use our power as a nation which imports a vast quantity of goods.
  This is a very powerful lever which we have. Why should we always be so much concerned with the argument that it will damage us if we take reciprocal action? We can take reciprocal action, and I hope that we will do so, if we feel that various things which are detrimental to our interests are being done.
  To come to the point made by the hon. Member for Wanstead and Woodford, it is absurd that we should bind ourselves to observe agreements which have not been, and are not being, observed by certain other countries or that we should, for example, impose upon ourselves the limitations of G.A.T.T. in respect of the Soviet Union, the East European countries or China. China was very much involved at one time with the commodity with which I was concerned. Those countries are not in the least concerned about G.A.T.T. They are concerned with using their power as a State to push their separate interests in this way.
  From that point of view, we have to recognise that this is a different world. It is not a world of free trade versus protectionism. It is a world in which Governments are involved. I would like our Government to recognise this to be true and to act honestly. Where we are not being dealt with honestly, however, let us also use what power we have. Do not put our manufacturers in the position where the onus is always upon them. One would almost think that they were committing a crime or doing something reprehensible when they complain that dumping is taking place and doing them great harm.
  The question of material injury has been a large part of the argument. I

  899
  very much accept the point put by the hon. Member for Wanstead and Woodford. It is quite wrong, in the interests of a second industry or group of industries, to act in ways which result in injury to another industry, as could well be the case.
  We are often told that bilateral agreements have been entered into, that we have agreed to allow certain imports and that there will be a certain amount of exports. That may have nothing to do with the injury which has been wrought on a particular industry. When an industry such as the clockmaking industry, at a time when more and more clocks are being bought, not only stands still but even declines, this surely must be evidence of material damage being done to the industry.
  We have to think in terms of the interests of our industry. Let us put this first, not in the sense that we will go out and adopt all sorts of reprehensible practices, but, recognising the situation in the world today, say that industries must be backed by Governments and that we are backing our industries. Do not let us put them in the position always of having the onus of proving every little iota before action is taken.
  One doubts whether any action is taken. I am expecting that, from the Bill, we will now be in a position to take action which will ensure that the clockmaking industry—and I hope that we will be hearing from my hon. Friend the Member for Brecon and Radnor about the watchmaking industry, as well as others—finds itself secure and is able to go ahead and expand. I shall be disappointed if this is not done.
  8.40 p.m.
  Mr. Charles Fletcher-Cooke: The hon. Member for Motherwell (Mr. Lawson) has made an excellent speech. Indeed, there has been a consensus of excellent speeches in this debate. The hon. Member for Motherwell was right to say that this is not a free trade world. It is a world of very ugly autarchies, much uglier than the old capitalist private venturer freebooter world, because these autarchies we are contending with are much more powerful, much more ruthless and much more unscrupulous.
  900
  Therefore, I support the hon. Member and all those who have spoken in trying to bring to the Board of Trade, which is a splendid and honourable but somewhat 19th century institution, an atmosphere of urgency, now that we are in the second half of the 20th century, and that rather lofty judicial attitude which the Board of Trade preserved in the past must, I think, go—and is, I believe, going.
  I have detected even over the last year, from letters one gets from the Board of Trade, from remarks which are made from the Government Front Bench, a recognition, at long last, that it is not enough for the Board to act as a lofty neutral in these matters, but that it has to take positive and early assistance to the British trader and to British industry. It has to take the initiative in the matter and not act merely as an umpire, as it has so often done in the past. That is why I welcome the speech of the hon. Member for Motherwell and also that of his hon. Friend the Member for Oldham, East (Mr. Mapp).
  The 1957 Act I always regarded as a weak Act, made weaker by the method of the administration, and, in so far as this Bill strengthens it, it is, of course much to be welcomed. It does not strengthen it very much. I think that is because, as is common knowledge, in the Kennedy Round negotiations the Board of Trade view, if I may so put it, prevailed in the world against the system of anti-dumping which many other countries such as Canada had previously adopted.
  Before the Kennedy Round negotiations at Geneva recently a great many of us advocated that we should adopt what is broadly and roughly called the Canadian system; that is to say, the system by which a consignment of goods coming into a country should carry with it a statement or a statutory declaration or an affidavit, something of that sort, declaring positively that there is no element of double pricing, that, allowing for carriage, insurance and freight, the price is the same as it would have been if the consignment had been sold on the domestic market. This was the requirement of the Canadians which they always insisted upon, and, I always thought,

  901
  rightly insisted upon. However, I understand that at Geneva their system was condemned, and that our somewhat easygoing system was that to be adopted universally.
  One of my questions to the Minister of State is: to what extent have other countries adopted the system which was laid down at Geneva recently and which is immortalised or enshrined in the Articles which we are provided with? To what extent, for example, has Canada waived her requirement, which she used to have in the past, as regards an affidavit or statutory declaration, and to what extent has she come into line with the Board of Trade philosophy which prevailed at Geneva? I think that we are entitled to know that if we ourselves are to miss the opportunity which this Bill provides for adopting a stricter system.
  For in our system there are many weaknesses still. They are weaknesses which the hon. Member for Oldham, East mentioned. They are weaknesses of definition. What is "injury"? What is "material"? Above all, what is an "industry"? The words are "material injury to an industry". The Articles emerging from Geneva include the fourth Article which gives the definition of an industry, or purports to do so, but, in fact, is does not give us much help.
  For this is no academic point. This is a problem which emerges frequently in the textile industry. Has the injury to be to the textile industry as a whole? Do we define the industry as the whole textile industry, or do we break it up into greater and lesser parts? Is it enough to prove that it is damage to the weaving industry, or is it enough to prove it is damage to one particular form of weaving? What is an industry? It is not defined in the articles, but this has often been used in the past by the Board of Trade as a reason for not taking action.
  The Board says that dumping may injure the doubling industry, or the doubling part of the textile industry, but it does not damage the textile industry as a whole. Indeed, to a certain extent, it assists the other parts of the textile industry. It gives them a cheaper raw material on which to work, and it therefore means that the other and larger sections of the textile industry will flourish
  902
  as a result of cheap imports. We cannot say that shows material injury to industry.
  So far as I know, no attempt has been made to clarify or define what is meant by an "industry" in the amending legislation. It is a problem that has been acutely exciting complicated industries. I have no doubt the same thing occurs in the agricultural industry, certainly it does in the textile industry. I should not be surprised to hear that it does even in the watch-making industry.
  We would like to know from the Minister of State whether that problem is now solved to the satisfaction both of Governments and of British industries and, if not, what their proposals are for solving it. Was it raised at Geneva? How was any attempt to clarify it at Geneva received by the other high contracting parties? Did we press our case as we should have pressed it, that an industry should be defined pretty closely and narrowly? Otherwise, the dumper will do what he has so often done in the textile industry, which is to take each section of the industry and knock them out severally. This has happened over and over again. He takes one section of the textile industry, concentrates on that, knocks it out and then moves on to the next one. I do not find in the Bill any better or more understandable definition of the word "industry" than that which gave us so much trouble in the 1957 Act and previously.
  For that reason, I am not sanguine about how the Board of Trade proposes to administer this legislation in the future. It all depends upon administration, as the hon. Member for Motherwell so rightly said.
  May, I nevertheless, say that there has been better policing at the ports in the last few months, if not in the last year. We in Lancashire have been very pleased. I do not know whether the import committee of the Textile Council is responsible, but many cases have been stopped which a year or so ago would have slipped through.
  For example, a consignment of goods was stopped at the ports which was labelled as coming from Denmark, but which, in fact, came from Portugal. I would like to know whether it has been seized and will be sold by the Board of Trade at a ridiculously low price, as

  903
  used to happen. I hope not. I hope that it will be sent straight back to Portugal where it came from and where it should be returned. Perhaps the Minister of State might tell us what has happened to this consignment, which has excited a good deal of interest and commendation in Lancashire but will certainly receive its execration if it is sold by auction at the lowest possible price, thus defeating the whole object of the exercise.
  If I may look for a moment at the Bill, Clause 2 is rather cagey about what it actually does, in what respect it amends the proviso to Section 1 of the 1957 Act. All that the Explanatory Memorandum says is that subsections (1) and (2) of Clause 2 clarify the provisions relating to G.A.T.T. countries now incorporated in the proviso to Section 1(1) of the 1957 Act, and this proviso is repealed by Clause 2(6). I am a little suspicious of the word "clarify". My own view is that it does alter the provisions quite considerably, and I am glad it does.
  But I would want to know exactly in what respect. It may be that the Minister of State would rather not say so too loudly or publicly on the grounds that it might otherwise be held by mischievous persons to conflict with the new Kennedy Round arrangements. That may be the explanation of the word "clarify" in the Explanatory Memorandum and, if it is, I shall understand. If it is not, one would like to know exactly how it tightens up Section 1 of the 1957 Act, the proviso to which is now to be repealed.
  We will continue to chase the Board of Trade over this matter of rapid, effective and substantial help to all sections of British industry. It is not enough to expect the applicant to prove everything of his own motion. It is not enough to expect him to prove material injury to the whole industry, because the whole industry is much too big a unit for this purpose and ought to be defined more closely. It is time that the Board of Trade took the initiative and, if necessary, even without complaints and applications from industry, operated the new powers which it is adopting and which we are all very glad to see.
  8.51 p.m.
  Mr. Gordon Oakes: I hope that my hon. Friend the Minister
  904
  of State will note the remarkable unanimity with which hon. Members on both sides of the House regard the Bill. We all welcome it and the intention behind it. However, we all have the utmost suspicion that the Board of Trade will not operate the Measure to its full powers.
  The hon. and learned Member for Darwen (Mr. Fletcher-Cooke) and my hon. Friend the Member for Oldham, East (Mr. Mapp) said a great deal about the textile industry, much of which I would like to have said. However, I will not delay the House by going over the ground again. The hon. Member for Tiverton (Mr. Maxwell-Hyslop) made an excellent speech. Most of us thought that he would address himself to agricultural problems but, instead, he dealt not only with those but with the widest possible problems.
  I, too, would urge my hon. Friend to realise how frustrated hon. Members feel when they are told in answer to Questions that there have been no applications for anti-dumping action to be taken, or, worse still, when they are asked to supply highly technical evidence of market prices in foreign countries, bearing in mind taxes and administrative costs to the Board of Trade, when it is the Board's job to know that information via our consular offices in those countries.
  The Bill can give the Board of Trade the power to take steps pending a final investigation. There have been clear cases of dumping where action could have been taken but where it was not taken because to do so would have been attempting to lock the door after the horse had bolted. That is no longer the position. The Board will now be able to take provisional action while the evidence is being found, and I urge my hon. Friend to take immediate action if he finds that the dumping of clocks, agricultural produce or textiles has occurred.
  I, too, was alarmed to hear my hon. Friend the Parliamentary Secretary say that dumping may be eliminated in certain circumstances and reduced in others. There is no question of reducing dumping. Agreement was reached between the countries. There is no question of saying, "If you reduce the level of dumping or raise your prices a little, we

  905
  will let in your goods." The Board of Trade must not operate in that way. There is complete unanimity on this matter between both sides of the textile industry, who work very well together. If the Board of Trade were to operate in that way, the fears of both employers and unions would be justified.
  Like the hon. and learned Member for Darwen, I wonder what is meant by
  "cause or threaten material injury to an established industry…"
  Does it mean a whole industry, does it mean a firm, does it mean a section of an industry? Most important of all, what will the Board of Trade construe as "material injury"? I hope that, having got the powers to take immediate action, we do not get stalling about whether the injury will be a material injury to the industry.
  Most of the countries from which we strongly suspect that dumping of cotton textiles takes place, either long-term or sporadic, are members of G.A.T.T. Portugal, India and Pakistan are members of G.A.T.T. Therefore, that Clause will be in operation in each case.
  I put to the predecessor of the President of the Board of Trade the position in the United States, which is also a member of G.A.T.T. I pointed out how rigorously it enforced its regulations concerning the textile industry. I understand that it requires a certificate from its consul in the country of origin to accompany the consignment of goods stating clearly the average market price of the goods in that country. That must be of inestimable assistance to the Customs' officers of the United States when deciding whether dumping of any given goods is taking place. They have a document before them which serves as a yardstick when a consignment is coming in, instead of having to make inquiries through the embassy or, worse still, wait for complaints to be made. I commend that system to my right hon. Friend, and ask him to consider whether it would work in this country.
  The hon. Member for Wanstead and Woodford (Mr. Patrick Jenkin) said that there had been a self imposed restraint by the Board of Trade in adopting the provisions of the 1957 Act. That is a kind way of putting it. To the textile industry, that self-imposed restraint
  906
  seemed very like sitting doing nothing and letting the goods come in without taking any action.
  I welcome the Bill most warmly, but I want to reinforce what has been said by all hon. Members who have taken part in the debate, many of them from cotton constituencies. Many of us, like my hon. Friend the Member for Rochdale (Mr. McCann), who is listening most interestedly to the debate, but who, because of the conventions of the House, cannot enter into it, feel that if the Board of Trade will work the Bill with the power we are now giving it can be of benefit to British industry.
  8.58 p.m.
  Mr. Michael Jopling: I apologise to the Parliamentary Secretary for missing the first few minutes of her speech, but a shattered windscreen on the M1 delayed me longer than I expected.
  We have had a most interesting debate. I cannot remember a debate on the Second Reading of a Bill where a Department bringing the Bill forward was so roundly criticised and had such great distrust poured upon it by back bench Members on both sides of the House.
  I want to devote my remarks to the way that dumping affects agriculture. Dumping has brought a long saga of problems. It is a constant sore to the industry. It has affected it in many ways with many different commodities in recent years. It has been a constant trouble with eggs and butter from Iron Curtain countries, and, more recently, other commodities, such as wheat, have presented problems.
  Concerning the Iron Curtain countries, I very much welcome the provisions of Clause 3(2), which allow the Board of Trade to make comparisons with similar goods from other countries arriving at a fair price. I hope that this will put a realistic price into the market when assessing whether products from Iron Curtain countries are dumped.
  This is most unsatisfactory legislation because it is not backed up by firm intent by the Board of Trade. Time and time again the Board of Trade has let us down in administering the legislation. A classic example of this, a quite disgraceful example, was seen last year when eggs were dumped on our market. Even the

  907
  President of the Board of Trade admitted that they were being dumped, but he was not prepared to do anything about it. If anything could underline more clearly the weak attitude which the Board of Trade has consistently shown towards dumping, that seems to do so.
  There seems to be a basic divergence between the Board of Trade approach to dumping and the interests of others in the country. I hope that the Board will show more good will in its attitude to dumping in future. As my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop) said, it is quite unfair to put the whole onus on applicants to make a case. There is the Board of Trade, a vast Government office, which we expect to look after the national interest. We do not expect it to sit back paying lip-service to the evils of dumping and doing something about it only when it is firmly forced to do so, and even admitting that dumping is going on and refusing to do anything.
  I realise that agricultural products form one of the most difficult spheres in which to detect dumping. Because so many countries subsidise and support their agricultural industries, it is extremely difficult to come to a proper price and to make a proper assessment of whether dumping is happening. We are in a serious situation at the moment, and in the months and years ahead we shall have much greater problems of dumped foodstuffs than we have had in recent years. I shall quote a few examples of problems which I think lie ahead of us. I hope that legislation will meet them, provided there is good will and that some form of action is taken by the Board of Trade in administering the legislation.
  My first example is that of butter. There is an ever-increasing mountain of butter in Europe. We are told that there are 150,000 metric tons in stock in Europe. It has been estimated that that stock will rise to three-quarters of a million metric tons in the next three or four years. We have managed to stop up one loophole of dumped butter which glories in the name of "butter oil", but we are likely to have great threats to our market here of dumped butter from Europe unless the Board of Trade is willing to act.
  908
  There is the problem of dried milk powder. In some countries in Europe a very heavy subsidy is given to the industry. We are told that in Austria £100 a ton is paid, and in France, the Milk Marketing Board tells us, the subsidy is around £200 a ton. Dried milk powder coming from other countries in Europe to the United Kingdom has done great damage to our milk industry. In 1961 our producers had 62 per cent. of the dried milk market with something like 25,000 tons. In 1966 that had dropped to only 19,000 tons, 45 per cent. of the market. The Board of Trade has refused to take action, although it has been clear that material damage has been done to our industry. Austrian dumping alone has caused an £8 million loss to our home industry in the last few years.
  I can do no better than quote the White Paper produced last year by the Ministry of Agriculture when we were beginning to contemplate joining the E.E.C.:
  "Manufacturing milk prices average about 21d. per gallon and are determined by a world market on which a good deal of produce is dumped and subsidised."
  Everyone is aware of the dumping, but there is no determination in the Board of Trade to do anything about it, although in many cases provision exists for action to be taken.
  I turn, finally, to a problem which is already affecting our industry and which is likely to affect it even more in the next few months—the great amount of French wheat which is poised over our market. It has caused serious damage already to the wheat trade of our country. In Europe there is an enormous restitution payment on exports of wheat. In the last few months it has almost reached 55 dollars per metric ton. These exports have gone all over the world. This is one of the great dangers of the E.E.C. restitution system, in that the restitution is equal to the import levy, and where there is a product far more of which is exported than is imported, that comes to a form of export subsidy.
  In France in recent months the restitution of £22 or £22 a ton has been more than the price at which the commodity has been bought on the open market. It seems clear that the E.E.C. restitution payments system has caused enormous

  909
  damage to our market. If Ministers at the Board of Trade care to speak to the corn trade in the country they will be told that in no uncertain terms.
  The E.E.C. rules make it much easier for them to subsidise such exports as these, and it is particularly easy for France to flood the world markets with a commodity such as wheat when the other five countries of Europe are contributing far more to the guidance and guarantee fund than is contributed by France. These exports of wheat have ruined our market and caused great losses to many farmers and corn merchants. The criteria for making a levy are well known, and I believe that most of them have been broken in respect of French wheat. It is clear that the export price of wheat is below the free market price in France. In France wheat is changing hands at about £40 a ton, and it is being sold at about £20 a ton. This has done material damage to our market. It is all very well for those farmers who made forward contracts for wheat at fixed prices; they are doing rather well. But it has caused very serious losses to farmers and to the corn trade where people have sold wheat on open contract.
  I come back to the excellent speech of my hon. Friend the Member for Tiverton. He spoke of the national interest and of the taxpayers' interest. Material damage is being done to the taxpayers' interest by the French wheat being exported to this country. Indeed, it might easily require a Supplementary Estimate for the wheat deficiency payment.
  We on this side believe that it is essential to move to a levy system for agricultural imports, but I shall not go into that argument now. The Minister of Agriculture has announced that he is contemplating raising the minimum import prices of cereals by the equivalent of the devaluation. We do not regard that as the right way to do it. First, it gives a free gift to the exporting country, whereas we could well do with the balance ourselves. Second, the minimum import price does not offer a flexible enough way to control dumped imports. It would be far better done through the levy system which we on this side suggest.
  910
  I shall say no more now. I have given three concrete examples of the great dangers likely to affect our agriculture during the months ahead, and I have cited what is happening in regard to wheat which is already being dumped. A great deal of good can be done by the existing legislation to protect our industry from dumping, but when the Ministry has shown itself—I do not necessarily blame the party opposite for this, because I do not believe that our Ministers were much better—consistently weak-kneed and lacking in resolution to implement legislation of this kind, we shall not get very far.
  Like my hon. Friend the Member for Tiverton, I hope to hear a firm assurance tonight that the days of weakness are over and that we are to have strong action in the future.
  9.12 p.m.
  Mr. Tudor Watkins: It is my privilege, as Chairman of the Specialist Committee on Agriculture, to have as one of my colleagues and members of that Committee the hon. Member for Westmorland (Mr. Jopling), and I warn the Minister of State that, if the hon. Gentleman is likely to be as persistent in his questions and advocacy on this matter as he is in the Select Committee, note had better be taken of what he says.
  I usually speak on agriculture, and I might well have joined the hon. Gentleman in what he had to say, but I wish to take up what was said by the hon. Member for Wanstead and Woodford (Mr. Patrick Jenkin) about one feature of the Bill. On behalf of my constituents, I pay the hon. Gentleman a tribute for raising the question of the import of Russian watches. I had originally intended to come to the debate and to listen to what the Front Bench speakers and other hon. Members had to say, but, now that the hon. Gentleman has raised the matter of Russian watches, I urge my hon. Friend the Minister of State not to think that, because the hon. Member for Wanstead and Woodford raised the matter first, there is no validity in what he said.
  I endorse the hon. Gentleman's complaint. This is an important matter

  911
  generally nowadays, and it is of particular significance for my constituents. In Clause 1(2) we find the words,
  "that the effect of the dumping…is such as to cause or threaten material injury to an established industry".
  I think that I am the only Member of Parliament who has a watch-making industry in a super-development area. I know how essential it is that the question of imported Russian watches should be looked at again. It has been looked at often enough, and I shall not now go through the correspondence, which I have had the privilege of seeing, with the British Clock and Watch Manufacturers Association. I am in constant touch with the watch factory at Ystradgynlais, a very important factory providing a great deal of employment.
  I am raising the matter now because in that valley, as the Parliamentary Secretary knows probably better than the Minister of State up to now, there is unemployment of between 6 and 7 per cent. We have had three collieries closed, and over the past few years there have been redundancies in the watch factory itself. There has been short-time working to the extent of workers being out one day in six. I admit at once that the difficulties are not all due to the importation of Russian watches, but this has a psychological effect on the people who are interested in the future of the industry in Ystradgynlais.
  The industry came there after the end of the war, and I pay tribute to the late Dr. Hugh Dalton and the late Sir Stafford Cripps for their efforts in bringing it there. I hope that as a monument to them the factory will go on for ever. It gives employment to disabled people, which is very important in that locality. Unfortunately, owing to unemployment, the people who bring the income into most of the homes in the area are now the womenfolk employed in that factory. It produces a large number of apprentices, and the other week I was privileged to be at a ceremony at which certificates were presented to the apprentices, young men from the locality who have the advantage of obtaining a good training to make this industry continue.
  But we have been concerned recently because of the increased quotas of watches
  912
  and watch movements. Movements are perhaps more important than the watches, for the total amount allowed in is far greater, and very little notice is given to the industry beforehand. There has been a great deal of discussion about this. I have been with deputations to see Secretaries of State for Wales, first my right hon. Friend the Member for Llanelly (Mr. James Griffiths) and then my right hon. Friend the Member for Anglesey (Mr. Cledwyn Hughes). They have always assured me that they have made representations to the Board of Trade, and in addition they have made representations to the Ministry of Technology. I appreciate the point of view of both those Departments, particularly the Board of Trade, that we cannot very well completely stop the importation of watches. I am a firm believer in East-West trade, but I wish that it were in a commodity other than watches. Having been in the Soviet Union myself, I am sure that it could do with quite a number of commodities—not only those which we are selling it at present.
  Mr. Patrick Jenkin: Has the hon. Gentleman thought of trying to enlist the help of the Secretary of State for Defence? Has he thought of the argument that if our watch and clock industry is run down too far the British defence programme will be severely jeopardised by the absence of an industry to make timing mechanisms for bombs, mines and so on?
  Mr. Watkins: I am very grateful for that new idea, because I thought that I had tried everybody. But first I shall see if I can get an assurance from my hon. Friend the Minister of State that he will reconsider this matter.
  A case can be put up by the Board of Trade. I shall not go into all the details. It would be unwise for me to do so, and I should not like to discuss openly in the House correspondence which has been going on with the officials of both Departments, but I suggest that there is a spirit of non-co-operation on giving full information about the costs of watches coming into this country. We are not receiving co-operation from the Soviet Union at present.
  A similar thing happened with Czechoslovakia some years ago. That country was dumping bicycle hubs in the United States at one-third the cost of producing

  913
  them at the Perry chain factory at Caerbont in Abercrave, and the result was that the factory had to be closed.
  I hope that my hon. Friend the Minister of State will look again at the watches question. He may say that the Board of Trade has examined it and done everything possible, but I hope that it will think again to see whether anything can be done, because I am very concerned about the future of the watch factory in my constituency which I have mentioned.
  9.20 p.m.
  The Minister of State, Board of Trade (Mr. J. P. W. Mallalieu): In general, the House has welcomed the Bill. I was very grateful for the manner in which the hon. Member for Wanstead and Woodford (Mr. Patrick Jenkin) made his opening remarks. The Bill has been approved by, I think, every hon. Member who has spoken. Where the criticism has come has been on the past and present administration of the Board of Trade and about the doubts which hon. Members have about its resolution in the future. Indeed, it has been fascinating to me to hear the many tributes of warm admiration to the Board of Trade being coupled with such total suspicion of both our motives and our abilities.
  It is natural that industries in this country should suspect a Department which has to have regard to the position of the consumer, the importer and the exporter. But looking back over the record of the present and immediately preceding "weak-kneed" administrators at the Board of Trade, I find the record on the whole remarkably good.
  Since our anti-dumping legislation came in, in 1957, we have taken a good deal more anti-dumping action than has been suggested by any hon. Member tonight. I know that a straightforward comparison between actions taken by us and those taken by other countries may well be misleading, but, for what the comparisons are worth, we have taken antidumping action ten times in the last five years, and this is substantially more than the rest of all the other European countries put together.
  We have imposed as many formal antidumping duties as has the United States, and its investigations are every bit as good and as thorough as ours are.
  914
  Admittedly, this does not take into account the deterrent effect on imports into the United States of the withholding of Customs appraisement for a lengthly period while investigations are taking place, but here the anti-dumping code will, I think, bring about substantial improvements.
  Besides the actual measures bringing in anti-dumping duties, it has been possible on many occasions—I shall mention one or two of them—to bring about the desired results by other methods. The mere mention that an investigation is taking place sometimes has the effect of producing second thoughts on the part of the exporting country and producing the effect that we desire. On a number of occasions, too, we have quietly made direct approaches to the Governments or industries in exporting countries which seem prima facie to be causing disruption in this country or to be dumping, and as a result of those representations the position has been remedied.
  A mass of points have been raised in the debate. Some of them are, I think, matters of administration, and some may well perhaps best be handled in Committee. Without seeking to delay the House unduly, I will deal with many of them.
  I, like everybody else in the House, enjoyed the speech of the hon. Member for Tiverton (Mr. Maxwell-Hyslop) and thank him for his nice reference to myself. He and others asked why the Board of Trade insists on people rather than itself producing the evidence. There are two reasons for this. First, if the Board of Trade has to investigate every product, or at any rate every group of products, that come into Britain and find, first, whether the price is right in terms of dumping and, secondly, whether the effect is wrong in terms of disruption, we shall have to recruit into the Department the hordes of civil servants who the Tory Party and my hon. Friends are continually begging us not to recruit.
  There is an even more potent argument. Article 5(a) of the new code specifically lays it down that
  "Investigations shall normally be initiated upon a request on behalf of the industry affected, supported by evidence both of dumping and of injury resulting therefrom for this industry."
  We in the Board of Trade do not confine our thoughts to applications which are

  915
  made only by a trade association. They could well be made by individual firms. As to "material injury", it is not that the injury must be to the whole of an industry. It could very well be to a section of an industry.
  The hon. Gentleman also raised the interesting question of injury to the taxpayer. It is very difficult to meet this point. The code and G.A.T.T. lay down that injury in these terms must be caused to the domestic producers of the like product. Therefore, under international agreement it would be difficult for us to consider the taxpayer in that context.
  Mr. Maxwell-Hyslop: Is the Minister bound to apply the code to countries which are not signatories to G.A.T.T.? Many of the complaints which have been made in the debate apply to countries which are not signatories to G.A.T.T. Why, therefore, does the code tie the Minister's hands vis-à-vis such countries?
  Mr. Mallalieu:I should have to have notice to give a full answer to that question, though I will certainly try to obtain the answer. In certain respects we are not tied by the code to dealing with countries which are not signatories to G.A.T.T., as the Bill tends to show.
  Mr. Patrick Jenkin: I support my hon. Friend in pressing the Minister. This was the precise question I put to the Parliamentary Secretary. The second time I put it, when I think she understood what I was getting at, she said that the Minister of State would deal with the matter later. I must ask the Minister to give us an explanation. Why are the same rules applied to imports from non-G.A.T.T. countries as are applied to imports from G.A.T.T. countries?
  Mr. Mallalieu: I was about to deal with that issue, which the hon. Gentleman has raised very forcefully. I thought that the hon. Member for Tiverton was dealing with an even wider issue.
  The reason we have regard to material injury with non-G.A.T.T. countries is that in our judgment it would be unwise to interfere with trade by anti-dumping legislation unless the dumping is in fact causing injury. We think that because trade between this country and countries of the Eastern bloc is, thank goodness, expanding very rapidly and we think that
  916
  it would be wrong to apply one set of criteria to the G.A.T.T. countries and another set to the Eastern European bloc when trade is expanding at its present rate.
  Mr. Lawson: My hon. Friend will agree that there are marked differences about what constitutes material injury? I was speaking about the clock industry which has been materially injured by dumping from Eastern European countries. From what my hon. Friend has been saying, it seems that he attaches more weight to an expansion of trade than to the proper protection of an industry in this country which is being injured.
  Mr. Mallalieu: I can assure my hon. Friend that I should not be allowed to forget clocks. The issue has been put extremely forcefully in the debate and I propose to deal with it in a moment.
  My hon. Friend the Member for Oldham, East (Mr. Mapp) was worried about the imports of a product for which there was no direct comparison. The code provides that in the absence of such a like product another product which, although not alike in all respects, has characteristics closely resembling that of the product under consideration, may be taken for comparison. The nearest possible comparison is used.
  My hon. Friend the Member for Motherwell (Mr. Lawson), my hon. Friend the Member for Brecon and Radnor (Mr. Tudor Watkins) and the hon. Member for Wanstead and Woodford all referred to the import of clocks. This new legislation may be extremely helpful. In the past, when representations were made to the Board of Trade it was as difficult for us as for the industry itself to find out exactly what were the costs of production and the domestic selling prices in countries in Eastern Europe, particularly Soviet Russia. Because of that difficulty, we are now proposing to make it possible when trying to decide whether dumping is taking place to make a comparison with the prices at which similar products from other countries are being sold, comparing those prices with those of a product from a centrally planned, centrally controlled economy.
  I cannot say for certain that when the Bill goes through the import of clocks

  917
  and watches will be caught, but I can give my hon. Friend the Member for Brecon and Radnor the assurance that, provided the industry maintains its application and will provide, as best it can, evidence for a prima facie case, we shall most seriously look at it again.
  The hon. Member for Wanstead and Woodford queried the word "repaid". He thought that exporters to this country would have only to put up a bond. In fact, my hon. Friend said that they would have to put up hard cash. Therefore, repayment comes in that. The hon. Gentleman also queried the use of the word "expedient". If there is a continuing importation of heavily dumped goods, we shall consider the advisability of taking provisional acton. But we shall need to be satisfied that that is happening.
  The hon. Member for Wanstead and Woodford also made play of the fact, as he thought, that the first mention of the Bill, which he welcomed, was made to a trade union. I have just considered that point. I thought that he was wrong, and in fact he was. The first mention of it was made by the late President of the Board of Trade—[HoN. MEMBERS: "Former".] I beg the pardon of my right hon. Friend the Member for Battersea, North (Mr. Jay); he is very much alive—in answer to a Parliamentary Question on 4th August, 1966.
  The hon. Gentleman referred to some differences in the wording. I am advised that these are due to some curiosities in the wording of the 1957 Act which I do not understand. However, what is important is that those differences will not make any difference whatsoever in the administration of the Act.
  Sir Douglas Glover: Would the hon. Gentleman explain why, as he says, he does not understand the Act? How can he give the House an assurance such as that?
  Mr. Mallalieu: I understand that there are differences, but I cannot see why they should make any difference to the administration of the Act, and our intention, I state categorically, is that they will not do so.
  The hon. Member for Westmorland (Mr. Jopling) made a number of criti-
  918
  misms about how anti-dumping legislation had been used, or not used, in dealing with agricultural products. The facts seem to be reasonably clear. Over the 11 years during which the present Act has been in operation, we have dealt with 34 cases concerning agricultural products and foodstuffs. One of them was withdrawn. Seven were rejected at the initial stage because there was not even a prima facie case of dumping and material injury. Of the 26 cases fully investigated, anti-dumping duties were imposed in two instances and satisfactory undertakings from the exporters were obtained in seven more.
  During the last three years there have been only three applications, which surprises me, relating to primary agricultural products. Two were in respect of imports of chickens and duck meat from Denmark, and the third related to imports of eggs from various countries.
  Following our investigations, the Danish Government agreed to restrict exports of chicken and duck meat to a level which would not cause material injury to the British industry. As to eggs, about which the hon. Gentleman felt strongly, we found that the effect of the imports, although they produce a disturbing pattern on the market, were not such as to cause or threaten material injury to the British producers. However, we have since had talks with the supplying countries about the level of their shipments of eggs to Britain in the first part of this year. As a result, the imports are expected to be lower than they were in the first half of last year.
  Many hon. Gentlemen have raised points about the textile industry, including my hon. Friends the Members for Oldham, East, Bolton, West (Mr. Oakes) and the hon. and learned Member for Darwen (Mr. Fletcher-Cooke). During the past year I have had to bear a major part of the tremendous criticism about dumping textiles. I know enough of the industry from years gone by, and from my present job to realise that there are immense difficulties facing Lancashire as a result of cheap imports.
  In trying to assess the material injury here, we may have to judge the effect of imports of a particular fabric on the profitability of the total home production from the looms used to produce this

  919
  fabric. This is because the firms concerned cannot always provide the financial information we need about the sales of one particular fabric woven on looms that produce a wider range.
  We should not exaggerate the difficulties caused to Lancashire through dumping. Three cases have directly affected the Lancashire industry last year. In two of them, all the evidence produced to us suggested that the industry's difficulties were due, not to dumping, but to imports of goods with low production costs. In the third case, concerning rayon yarn from Austria, we rejected the application formally, that is to say, we did not impose a duty, but we approached the Austrian exporters, and on both amounts and price we got assurances, and are making sure that they are kept, which prevented material injury from developing on a large scale.
  Mr. Fletcher-Cooke: Has the Board of Trade ever imposed an anti-dumping duty applying to textiles in the whole of its history?
  Mr. Mallalieu: My belief is that the answer to that is, "No".
  Mr. Fletcher-Cooke: It is my belief, too.
  Mr. Mallalieu: That is probably what has happened. We now have an Imports Commission and if the House will accept that, under international agreement the evidence in the initial stages must come from the industry itself, I would urge the Commission to give the evidence to us at the first moment that it feels that it has such evidence of dumped goods which are causing material injury.
  Mr. Oakes: This is the point that most hon. Members were making. My hon. Friend said that the industry should go to the Board of Trade. Will not the Board look into this itself and find out what dumping is taking place? On the point that he has just made about Austria, may I ask my hon. Friend whether it is a fact that the Board of Trade says to Austria, "If you dump a little less it is all right"?
  Mr. Mallalieu: I tried, however briefly, in the opening parts of my speech to deal with the point that under international agreement, apart from the
  920
  difficulties that the Board of Trade, with a comparatively small staff, would have, it is necessary for the industry itself to produce prima facie evidence. Once that been done, however, and we have the prima facie evidence, the Board of Trade steps in with its own teams.
  It may be some reassurance to the House about the willingness of the Board of Trade to do what it says it will do that, despite the clamour for reductions in the numbers of civil servants, we have increased the number of those teams in September and we propose to increase them further once the Bill has been passed. Once the prima facie evidence has been produced, the full investigation will be done as quickly and as thoroughly as we can. [An HON. MEMBER: "Too late."] The whole point is that there are provisional powers to deal with this.
  Mr. Mapp: My hon. Friend is now saying something of extreme importance, not least to the Imports Commission. If he is saying—
  Mr. Speaker: Will the hon. Member please speak up? The reporters are likely to have difficulty in hearing him.
  Mr. Mapp: If the Minister is saying what I was articulating before—that if the industry, as distinct from an individual firm, is able to establish a prima facie case as we understand the meaning of those words in the courts—do I take it that if that is done, my hon. Friend is saying that the establishment of guilt will in future be a matter for his Department?
  Mr. Mallalieu: It will in the future as it is at present. It will then be for the investigating teams of the Board of Trade to take up the matter in cooperation with our friends abroad and to establish the guilt or innocence, as the case may be.
  I hope that that somewhat inadequate reply to a wide-ranging and extremely interesting debate—
  Sir D. Glover: Hear, hear.
  Mr. Mallalieu: Whether it is inadequate, the hon. Member cannot judge because he was not present to hear the debate. I hope, however, that my reply will meet some of the fears which have been expressed. I assure the House that

  921
  both under the existing legislation and under the proposed new legislation, where we consider action to be justified we shall certainly take it.
  We have, or we will have under the Bill, the provisional powers which will make good what, in my opinion, was a serious defect in the previous legislation. I have told the House of our intention still further to increase the investigating teams. With those assurances both about the qualities of the Bill and of the spirit in which it will be administered, I hope that the House will now give us the Second Reading.
  Question put and agreed to.
  Bill accordingly read a Second time.
  Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).

SUNDAY CINEMATOGRAPH ENTERTAINMENTS
Order made by the Secretary of State for the Home Department, extending Section 1 of the Sunday Entertainments Act 1932 to the Urban District of Pickering [copy laid before the House 25th March], approved.—[Mr. Elystan Morgan.]

SCOTTISH STANDING COMMITTEES
9.50 p.m.
The Parliamentary Secretary to the Treasury and Deputy Leader of the House of Commons (Mr. John Silkin): I beg to move,
That the Orders [25th April] relating to Scottish Standing Committees be discharged.
I ought perhaps to explain how this Motion arose. It was originally the intention that this Motion, and the Motion on the Committee of Procedure, should be taken on Monday—today—and that the Motions originally put down for last Thursday should be deferred. Unfortunately, as the House may be aware, a rather disturbing incident took place during that evening, an incident of a sort which, I gather, has not taken place for 50 years, and, as a result of that, business was somewhat disrupted.
In the confusion this and the subsequent Motion went through on the nod.
922
I hope that the House will accept that there was no intention on the part of the Government to take advantage of hon. and right hon. Members who had views to express upon this matter. I can assure them that, on the law of averages, it will be the year 2017 before we have a like occurrence.
However, I feel it may be as well if I state why it is the intention to recommend to the House that a second Scottish Standing Committee should be set up. There is nothing unusual in this idea. Indeed, during last Session such a Committee was set up; the proposal went through on the nod; and during the Session before a similar Motion was moved, and, again, went through unopposed, on the nod. The basis of it arises on this consideration. The Scottish Standing Committee itself is extremely congested; it has a large number of Government Bills, and those Private Members' Bills which you, Mr. Speaker, certify as devoted exclusively to Scotland are at the end of the queue. It seemed unreasonable to many hon. Members that these Bills should be excluded from discussion simply because of the wealth of legislation going through the Scottish Committee. As a result, and as in the previous Session and the Session before, the Government were asked to set up a second Scottish Standing Committee. This we propose to do.
Of course, it is a matter for the House; it is urely for the convenience of back benchers. However, if there were a strong feeling against it—there was not last Session, there was not in the Session before—neither I nor my right hon. Friend the Leader of the House would wish to resist the desires of the House in this matter. However, it does seem to me that it is something of considerable importance to the House that there are useful Private Members' Bills which the Scottish Standing Committee would like to discuss.
Having explained how this Motion came into existence today, I would ask the leave of the House to withdraw this Motion at a later stage. The effect then would be, of course, that the Motion passed inadvertently on Thursday would be agreed by the House in the full knowledge of the circumstances.
9.54 p.m.
Mr. David Steel: We are in the rather peculiar position that the Government Chief Whip might be somewhat embarrassed tonight if anyone were to support the Government. I think that is the summing up of the situation which he has just described. Since the incident which occurred occurs only once in 50 years, I think that we may allow the Government an occasional slip up—one in 50 years. The right hon. Gentleman was kind and courteous enough to write to me last week and let me know that it was not the intention to move that Motion on Thursday night. I was, therefore, horrified that that Motion went through. The right hon. Gentleman knows my interest in it. I now wish to speak to this Motion so that I may press the Government Chief Whip for further assurances.
When the Motion first appeared I raised the matter with the Leader of the House, and he, following my representations, decided to withdraw the Motion for further consideration. I am not opposed to the idea of setting up a second Scottish Standing Committee, but the Government's Motion, which it is now moved should be discharged, involved setting up a Committee of between 20 and 50 Members.
As I understand, it is the accepted practice in the House during the lifetime of this Parliament that if a Committee consists of 30 or more Members the Liberal minority is entitled to a member on it, but if a Committee is of only 20 or 25 Members we do not qualify to nominate a member to the Committee, because the Standing Order states that the Committee of Selection has to have regard to the composition of the House. I think that I quote the Standing Order correctly.
The point I made to the Leader of the House was that here we are dealing not with a Standing Committee consisting of Members of the House, but a Standing Committee consisting of Scottish Members of the House, Members selected from the Scottish Grand Committee. I submitted to him that the representation of the Liberal minority in that Scottish Grand Committee consisting of 70 Members is one-fourteenth of the seats, a very much higher proportion than in the House generally. I thought that it was a reasonably fair point to make that on any Scottish
924
Standing Committee, even one of only 20 Members, we were on that basis entitled to a seat, and that we could not, as a party, justify to the electorate of Scotland our exclusion from any Committee of 20 Members dealing exclusively with Scottish matters.
There are two ways in which the Government can get round this, and I hope that the Chief Whip will give an assurance on one or the other. The first is that he will assure us that the second Standing Committee that he proposes to set up should consist of at least 30 Members, which would at least ensure that we had a Member on the Committee, and that we would accept without further ado. This is not a satisfactory solution in the long term. At the moment there are about 21 Committees of the House and it is clearly undesirable that more Members than are strictly necessary should be recruited to a Committee.
The Bills which it is proposed to remit to this Standing Committee are, as far as I understand, not contentious Bills. They are not Bills in which 30 Members would wish to participate. They are Private, Members' Bills, no doubt worthy Bills, but they are of limited interest in the House. I would think that 20 Members would be quite adequate to discuss these Bills, and it seems sad that we should have to dragoon 30 Members into a Committee in order to get correct representation.
I hope, therefore, that the Chief Whip may satisfy me on this occasion. I hope, also, that he may be able to say something about looking at the Standing Order to see whether or not there might be an instruction to the Committee of Selection to select the Members of Scottish Standing Committees with some regard to the composition of Scottish seats.
9.59 p.m.
Mr. Emrys Hughes: I welcome the assurance of the Chief Whip that he is giving consideration to the injustices to Scotland, especially in regard to Bills coming before the Scottish Grand Committee. I understand that there will be a further Motion on the Order Paper, and that the Chief Whip will consider a wider Motion than that one which was discharged.
I will not go into detail, but I wonder why, for example, the Scottish Standing Committee cannot be given power to meet

925
in Scotland. The suggestion is taken by some hon. Members as being revolutionary, but other Committees of the House, for example the Select Committee on Agriculture, had power to go to Brussels, and I understand that the Sub-Committees of the Estimates Committee travel all over the world. Yet the Scottish Grand Committee does not have the power to sit in Scotland.
I ask that this suggestion should be given serious consideration before the further Motion appears on the Order Paper, because there is a great demand in Scotland for the method of dealing with Scottish business to be modernised—
Mr. Speaker: Order. The hon. Gentleman may discuss that when we come to the second Motion which he hopes to see on the Order Paper some day. At the moment, we are discussing whether a certain Motion shall be discharged. He must link his remarks to that.
Mr. Emrys Hughes: I shall make only one further point—
It being Ten o'clock, the debate stood adjourned.

BUSINESS OF THE HOUSE
Ordered,
That the Proceedings on the Motions relating to Scottish Standing Committees and Procedure may be entered upon and proceeded with at this day's Sitting at any hour, though opposed.—[Mr. John Silkin.]

SCOTTISH STANDING COMMITTEES
Question again proposed.
Mr. Emrys Hughes: The Liberal Party has a definite grievance about its representation on the Committee. It may be undesirable to have members of that party in this House at all, and we do our best to prevent their coming here, but,, if they are elected, I submit that they represent their constituents and are entitled to have a fair representation on a Committee in which their constituents are interested. Today, we have a new element in the House in the shape of an
926
hon. Member who is a Scottish Nationalist. Some may say that it is undesirable to have Scottish Nationalists in the House, and that we should oppose their coming. However, irrespective of the political party represented by an hon. Member, he or she is sent to this House by the electors of a constituency and—
Sir Myer Galpern Sir Myer Galpern (Glasgow, Shettleston) rose—
Mr. Donald Dewar Mr. Donald Dewar (Aberdeen, South) rose—
Mr. Robert Maclennan Mr. Robert Maclennan (Caithness and Sutherland) rose—
Mr. Speaker: Order. The hon. Member for South Ayrshire (Mr. Emrys Hughes) cannot give way to three hon. Members at once. Sir Myer Galpern.
Sir M. Galpern: I have been following my hon. Friend's remarks with interest. In view of the absence of the hon. Member for Hamilton (Mrs. Ewing), can he assure us that he is making this plea with her full support? Is he quite sure that she is anxious to serve on every Committee of which he thinks she should be a member?
Mr. Emrys Hughes: I have not had any consultation with the hon. Member for Hamilton (Mrs. Ewing) and I do not speak with her knowledge. I take this point because of my experience on a local authority. My hon. Friend knows that it is always a matter of controversy in local authorities who shall be represented on different committees. I am arguing that, if a constituency returns a member to Parliament, whatever his political denomination, he is entitled to be represented on our Committees.
Mr. Dewar Mr. Dewar rose—
Mr. Emrys Hughes: I have not finished yet with the interruption of my hon. Friend the Member for Glasgow, Shettleston (Sir M. Galpern). I was saying in a chivalrous spirit that the hon. Lady is not here today, but neither are about 50 other hon. Members representing Scottish constituencies, and it would be just as unfair to attack one hon. Member—
Mr. Speaker: Order. We cannot discuss the presence or absence of hon. Members representing Scottish constituencies on this matter.
Mr. Emrys Hughes: Mr. Speaker, I was simply responding to an interruption. It may be that I did it too readily.
Mr. Dewar: Does not my hon. Friend agree that the logic of his argument is that, if a constituency returns a Member to represent its point of view, the electors have a right to expect that Member to take part in a given Committee? If that logic is pused to its conclusion, every hon. Member representing a Scottish constituency would be a member of every Committee, which would be slightly absurd.
Mr. Emrys Hughes: There may be complications. I am merely asserting what I think is an elementary point of democracy. I have no connection with the Scottish Nationalists, but if we had a Scottish Nationalist on the Committee we would do away with a grievance. As long as there is no Scottish Nationalist on any Committee the Scottish Nationalists will have a grievance, which, in an assembly of this kind, is a most valuable asset.
Mr. Maclennan: Will my hon. Friend acknowledge that my constituents might feel aggrieved if I were kept off a Committee so that someone else might sit on it? My hon. Friend ought to give consideration to the grievances not of one small section of the community, but of all Scottish Members.
Mr. Emrys Hughes: There is some point in that. I was merely trying to follow to its logical conclusion the argument put from the Liberal benches. It is a point of view I have always argued in county council and other local government deliberations. If any electorate sends a Member to a deliberating body he should not be excluded from a Committee. Therefore, I suggest that when the Leader of the House comes back with a Motion he should take this point of view into consideration.
I further ask for an assurance that he will deal not only with the congestion of Bills, but the congestion at Question Time. I have been arguing for many years, with very little support, that—
Mr. Speaker: I know the hon. Member's keen interest in the subject that he is attempting to raise, but he cannot raise it on this Motion.
Mr. Emrys Hughes: I apologise, Mr. Speaker. I understand that the Motion is rather narrow and I have had considerable latitude. However, I ask the Leader of the House to take into consideration some of the unorthodox elements in the House before he comes forward with another Motion of this kind. Although we may seem irrational and unorthodox, we may have some small contribution to make the government of Scotland more efficient.
Mr. J. Grimond Mr. J. Grimond (Orkney and Shetland)
rose—
Sir D. Glover Sir D. Glover rose—
Mr. Speaker: Order. The hon. Member for Ormskirk (Sir D. Glover), whom we are glad to see back, must restrain himself for a moment. Mr. Grimond.
10.8 p.m.
Mr. J. Grimond: I wish to speak very briefly on one point concerned with the Motion. Before I come to that, I should like to say that I agree broadly with the point of view put forward so eloquently, if sometimes out of order, by the hon. Member for South Ayrshire (Mr. Emrys Hughes). He speaks from the heart. He has on occasion even been opposed to the Labour Party. He has frequently been in a minority and, therefore, feels for minorities.
I want to add one short point to what has been said by my hon. Friend the Member for Roxburgh, Selkirk and Peebles (Mr. David Steel). I understand that one of the Bills which may be sent to this second Committee affects only a part of Scotland, the Highlands and Islands Bill, the crofting counties, and in this House the Liberal Party has a majority there. Therefore, I am sure that the Chief Whip, who is a very accommodating, reasonable and intelligent man, will see the point that to exclude the Liberals from this Committee would be inexcusable. This is an obvious point and I know that he will take it.
I support everything that has been said by my hon. Friend the Member for Roxburgh, Selkirk and Peebles. I will not repeat what he said, because no amount of repetition will make it more forceful in the mind of the Chief Whip.
10.9 p m.
Mr. George Willis: I do not wish to add to what has been said. I merely wish to raise a point on the Motion which has not so far been raised.
The Motion says:
"That the said second Committee…shall consist of not less than Twenty nor more than Fifty Members…of whom not less than Twenty Members shall represent Scottish constituencies."
It happens at times that in the House it is necessary to add English Members to reflect the balance of the parties, but, given the present situation, it seems there is no need for English Members to serve on this Scottish Committee. I therefore suggest to my right hon. Friend that we should have a Scottish Committee and not have English Members on it.
The present Secretary of State and I, on behalf of the Scottish Labour group in the House, were responsible for the change in our rules and procedures which provided for a second Standing Committee. It serves a very useful purpose. It is to the credit of the Scottish Committee that, although we are often accused of talking for long periods, in the Session before last, when the Committee was appointed, it dealt with and completed three Bills in one sitting. I do not think any other Standing Committee has a record to equal that.
10.11 p.m.
Mr. Hector Monro: I think that there is general agreement that Private Members on both sides of the House should have an opportunity for the Committee stage of their Bills to be taken in the second Committee. It would be right to remember that this idea was instigated—by my hon. Friend the Member for Moray and Nairn (Mr. G. Campbell) in 1963, when he was Under-Secretary of State—for this very purpose. It is fortunate that his Private Member's Bill, which received its Second Reading on Friday, will be the second Bill to go to the Committee following the Highlands and Islands Bill.
We should also bear in mind that one of the reasons why the Committee is being set up is the general mismanagement of Scottish business throughout this Session. There was no business forward in November when we could well have
930
had two sittings a week. It might have been possible to fit in Private Members' Bills; then sitting on Wednesdays would be unnecessary. The hon. Member for Roxburgh, Selkirk and Peebles (Mr. David Steel) is right to be concerned about whether it will be possible to get a quorum on a Wednesday. About 25 Committees, including Select Committees, meet then, and the Chairman's Panel and all Scottish Members are extremely fully engaged. To put more work on to them may mean that it will be difficult to get a quorum in the Committee.
Mr. Maclennan: The hon. Member made a point which should not go unanswered. He said that Private Members' Bills could be considered as early as November, but the Ballot for those Bills took place only at the end of November and they did not get a Second Reading before the beginning of the new year.
Mr. Monro: I did not think that I should need to put such an elementary point to the hon. Member. Surely he realises that it would have been possible for Government business to come on in November. Then we would have taken Private Members' Bills at this time.
10.14 p.m.
Mr. Donald Dewar: I had not intended to take part in this debate—I intended to hold my fire until later tonight—but I have been rather alarmed by the patriotic euphoria by which hon. Members have advocated that the Scottish Grand Committee should not reflect the composition of the House.
In discussing the Highlands and Islands Bill, there may be a real cause for grievance if there is not a Liberal Member on the Committee, but it is a tendency away from the rule that we should reflect the composition of the House. This was taken further by my right hon. Friend the Member for Edinburgh, East (Mr. Willis), who suggested that the Committee should consist of Scottish Members only. That seems very attractive and sounds extraordinarily patriotic, but ultimately it would be extremely dangerous.
It raises the most far-reaching questions, into which I do not want to go at great length tonight. For example, it

931
raises the whole question of the composition of Standing Committees. Possibly many hon. Members, including some Liberal Members, would like to eject English Members from the Scottish Standing Committee, but such a proposition would raise profound difficulties. Clearly, it could be possible for there to be a situation in which the Scottish Committee then consisted predominantly of one party which was not the party in Government. There would be a clash, and the question would arise of which business should be passed through the Committee and when. That would throw a most serious spanner into the constitutional works. Such a proposal should not be endorsed lightly merely as a good idea which would be popular and look good in tomorrow's Scottish Press. That is a dangerous basis to adopt.
Ultimately, we might have the situation in which legislation affecting the development districts could be discussed only by Members of Parliament from those districts, in which, for example, the Labour Party might have an enormous predominance. Next, if a Bill affected only Manchester, it, might be said that only Manchester Members of Parliament could be on the Standing Committee. It seems to me that we are tearing up the whole machinery by which Parliament works and writing a prescription to constitutional anarchy under which Government business would not go through.
Sir M. Galpern: Is it not the case that when a Bill applies exclusively to England and Wales Scottish Members are excluded from membership of the Standing Committee?
Mr. Dewar: Not as far as I am aware. If, because of the party allegiance of the Welsh Members of the House, a wholly Welsh Standing Committee could not truly reflect the composition of the House, then Members from the rest of the United Kingdom would be drafted on to it, and it might well he that my hon. Friend the Member for Glasgow, Shettleston (Sir M. Galpern) or English Members or myself would serve on that Standing Committee according to the whim or wisdom of the selection Committee, depending on how hon. Members regard it. I do not want to discuss the matter further, but I hope that the Leader of the House will resist at this stage any
932
suggestion that the Scottish Standing Committee should not reflect the composition of the House.
10.18 p.m.
Sir Douglas Glover: I rise to support what was said by the hon. Member for Aberdeen, South (Mr. Dewar), because it was very pertinent.
Mr. Willis: The hon. Member will not serve on the Standing Committee.
Sir D. Glover: I will come shortly to the right hon. Member for Edinburgh, East (Mr. Willis). There are one or two things which I wish to say to him.
I thought that the hon. Member for Aberdeen, South put the problem in a nutshell. I have great sympathy with the view of the right hon. Member for Orkney and Shetland (Mr. Grimond) about a Bill dealing with the Highlands and Islands, because the Liberals hold the majority of the seats in the Highlands of Scotland. But if we once accept the view that specialist Committees should be formed entirely by local membership, we are on a very slippery slope. Such a Committee would naturally produce a specialist solution, which might be quite contrary to the wish of the House as a whole.
It is necessary that other Members, too, should sit on a Committee dealing with the Highlands of Scotland, because we are allocating money or resources, and if the Committee were overweighted by a few Members from that part of the kingdom, it would probably reach a totally different decision from that reached by a Committee made up of broad spectrum of the House. Whether hon. Members like it or not, this is a United Kingdom Parliament and not a Scottish Parliament or a Welsh Parliament.
Mr. Willis: The hon. Member is missing the point. The Second Reading of the Bill has to be passed by the House and after the Committee stage, the Report stage is on the Floor of the House.
Sir D. Glover: The right hon. Member knows only too well that with a great many Bills, whatever is done in Committee is only too likely to pass the scrutiny of the House on Report and Third Reading. The Committee stage of a Bill is vitally important. The House

933
is the United Kingdom Parliament and not a Scottish Parliament. When the right hon. Gentleman said that the Scottish Committee should be formed only of Scottish Members, did he mean Scottish by birth or Members representing Scottish constituencies?
Mr. Speaker: Order. We are moving into very wide fields now. The purpose of this debate is to decide whether we should discharge an Order which set up a second Scottish Standing Committee.
Sir D. Glover: I bow to your Ruling, Mr. Speaker. I was only replying to arguments which had already been advanced in the debate.
In response to the Deputy Leader of the House—I gather that it was in that capacity he spoke from the Box tonight and not in his much more scurrilous capacity as Chief Whip of the Government party—I congratulate the right hon. Gentleman on the suavity with which he addressed the House in his new position, and I wish him success, though not for very long, in his tenure of office.
The right hon. Gentleman said that this would be the last time before the year 2017 when there would be a like occurence of the incident which occurred the other evening. All I can say is that on this small item, the earlier Motion having been passed on the nod—an interesting way to put it—the Government now, within three days, have to ask the House to rescind what was done, saying that what had been done, with great deliberation, was all a mistake. It typifies the administration of this country's affairs by the present Government. The sooner the Deputy Leader of the House and all his colleagues go, the better for the nation.
10.21 p.m.
Mr. George Lawson: I had not intended to intervene, but the hon. Member for Ormskirk (Sir D. Glover) has been a bit provocative. My right hon. Friend the Deputy Leader of the House made the position clear. Had he wished, the matter could have stood where it was. Two Motions were passed, which it was intended to pass, but because my right hon. Friend had let the hon. Member for Roxburgh, Selkirk and Peebles (Mr. David Steel) know that the intention was to afford an opportunity for him to say what he wanted to say, the
934
present Motion was put down for tonight. It is simply a matter of honouring an undertaking. But the situation could quite well have been allowed to pass, and, no doubt, some others might well have allowed it to do so.
The hon. Member for Dumfries (Mr. Monro) has been a bit tortuous in this matter, too. Perhaps he does not know that the extra Committee was originally set un under the Tory Administration, though prompted, admittedly, by my right hon. Friend the Member for Edinburgh, East (Mr. Willis) and various others of my hon. Friends, because we wanted to add to the machinery available for Scottish Members. It was set up when the Opposition were in Government, and it was set up in this form because we wanted to ensure that there were no abuses.
Before the Committee was set up initially, there was discussion with the then Opposition, of which I was a member. We wanted to ensure that the then Government did not use that Committee to force through controversial legislation, and we had agreement—admittedly, oral agreement—on what form it should take. It was understood that there would be no attempt to put controversial legislation through the Committee.
It was understood, also, that, as far as possible, we would keep the Committee small. I can tell the hon. Member for Roxburgh, Selkirk and Peebles that, subsequently, when we became the Government, we did our utmost to enable a Liberal Member to go on to that Committee. Indeed, an agreement was arrived at with the object of allowing a Liberal Member to come on to the Committee. We were prepared to have a Member stand down on either side—I think that the party opposite would have agreed—so that a Liberal Member might come on. But the rule, the legitimate rule, that the composition of the Committee should reflect the composition of the House had to be observed. That oral agreement was kept in the past, and, so far as I know, it would be kept in the future.
I can tell my right hon. Friend the Member for Edinburgh, East (Mr. Willis) that the form of the Motion was the same when we became the Government. The fact that it provided for 20 Scottish Members plus does not mean that the "plus" would be utilised.

935
I must support my hon. Friend the Member for Aberdeen, South (Mr. Dewar). Despite what my hon. Friend the Member for South Ayrshire (Mr. Emrys Hughes) says, these Committees were devised so that the House could get its business done more expeditiously and as a substitute for the functioning of the House. It is the House delegating a job to the Committee, and as the House is composed in a particular way so, very reasonably, the Committe should be composed in that way.
I yield to nobody in my Scottishness, and I should be very much opposed to any setting apart of any Scottish group, either in composition or place of meeting. This would be the first long step to driving us out of the House. For whatever reason, I want to see my compatriots continue in the House, because we need this House. We are part of the United Kingdom, and I think that the House benefits by our presence. I am very much behind my right hon. Friend in what he is doing tonight.
10.26 p.m.
Mr. John Brewis: I echo what the hon. Member for Motherwell (Mr. Lawson) said in concluding. It is true that the Committee was set up by us when we were the Government to deal with non-controversial Bills. But we do not have controversial Bills from the present Government now, because they do not bring them forward. They promised all sorts of things, but we have had the Water (Scotland) Bill, Sewerage (Scotland) Bill—
Mr. Speaker: With respect, we cannot have a list of the non-controversial Bills that have gone to the Committee.
Mr. Brewis: The reason this second Committee has had to be set up is that Government business has not been arranged in such a way that certain Bills could be brought before the existing Committee before now. As an example, the present main Scottish social Bill is coming before this Committee only on 9th May. I cannot imagine how it can be expected to be got through the House by the Summer Recess. It should have been brought much sooner. These Bills could easily have been brought before the existing Committee. For that reason I say
936
that there is no reason why the Committee should need to be set up, except the complete bungling of the Government Whips in this matter.
I am particularly interested to see that the Commitee will reflect the composition of the House. We have had numerous speeches from Liberal Members and others pointing this out, and saying that it was quite wrong that English Members should be added. Is it not very lucky that it is being fixed by the composition of the House, and not the membership which the country would elect, because in that case the Government would be bringing in English Members as quickly as they could in view of their present electoral position?
10.28 p.m.
Mr. John Silkin: I think that I should shortly reply to what has been an extremely instructive debate, at any rate for me.
I was very interested in the short lecture by my hon. Friend the Member for South Ayrshire (Mr. Emrys Hughes). I do not think that it was wholly germane to the point that we have to discuss. It will make an excellent chapter in another book, a copy of which I hope he will send me. He sent me the last one when our relationship was not as pleasant as it is now.
Mr. Emrys Hughes: It was in the last one. My right hon. Friend should have read it.
Mr. Silkin: I should really, but I have never had the time.
We are dealing with a Standing Committee and not a Select Committee. Select Committees have the opportunity of travelling around, and Standing Committees do not. There are many possible changes in procedure that the House may adopt now or in the future, but this is not the moment to discuss them. Certainly, my hon. Friend's gallantry in offering a seat on Committees to people who, I suspect, may not want them, may not be quite as much appreciated as he believes. There is sometimes a great deal of difficulty—if I can speak in another capacity—about getting Standing Committees filled.
The views put forward by the hon. Member for Dumfries (Mr. Monro) and

937
the hon. Member for Galloway (Mr. Brewis) do less than justice to their Conservative Government in 1963, because they said that the only reason for having a second Scottish Standing Committee was that the Government had messed up the business which had fallen behind and that if things had been done properly, everything would have been all right. On the one hand, the hon. Member for Dumfries thinks that we have too much crowded legislation and, on the other hand, the hon. Member for Galloway thinks that our legislation is non-controversial.
Mr. Brewis: Was the right hon. Gentleman here in 1953?
Mr. Silkin: As a matter of fact, I was. However, I am saying only that what is sauce for the goose is sauce for the propaganda. Incidentally, I should like to thank both the hon. Member for Ormskirk (Sir D. Glover) and my hon. Friend the Member for Motherwell (Mr. Lawson) for their very gracious speeches.
The real issue here is the representation of the Liberal Party. I appreciate the difficulty about a Standing Committee of 30. We are more than halfway
938
through a Session and there can be a bit of a log jam in Standing Committees and Select Committees. I cannot, and nor can my right hon. Friend the Leader of the House, pre-empt the Committee of Selection, but I hope that it will take this matter into account. I shall see that any influence which I have is used to see that there is a Liberal representation. It could be done with a Committee smaller than 30.
The hon. Member for Roxburgh, Selkirk and Peebles (Mr. David Steel) said—he probably did not intend to say—that the Liberals could be represented only if there were a Committee of 30. That is not true. If there is someone with expertise—and I should say that he himself has such expertise in certainly one of the Private Members' Bills which would be going to the Standing Committee—the Committee of Selection should take that into account. I hope that he will be satisfied with what I have said. I shall do my best to see that he is not entirely disappointed in this matter. With that, I hope that the House will permit me to withdraw the Motion.
Motion, by leave, withdrawn.

PROCEDURE
10.34 p.m.
The Parliamentary Secretary to the Treasury and Deputy Leader of the House of Commons (Mr. John Silkin): I beg to move,
That the Orders [25th April] relating to Procedure be discharged.
This is not a wholly Scottish Motion, although it contains Scottish elements. It arises exactly in the same circumstances and on the same date as the previous Motion. I know it to be of particular interest to the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) and the hon. Member for Twickenham (Mr. Gresham Cooke).
In the procedure debate on 14th November, 1967, my right hon. Friend the Lord President of the Council forecast a proposal to appoint a Select Committee on Procedure with very narrow terms of reference, the basis of which would be to consider whether we could usefully modify the year to the best advantage in our work in the House, that is to say, whether we were having our Recesses out of proportion, whether some were too long and some too short, whether we had enough terms, whether we had enough Recesses and whether—although this is difficult—we could relate our House year to the calendar year.
These were the questions that he felt that the Committee ought to consider, and it was for this reason that he recommended it to the House, and the House appreciated that this would be a useful exercise for the Committee. I should point out that it is a fact that the Select Committee has been working very hard over two Sessions. The last Session was one and a half times the size of a normal Session. We all paid tribute to the Committee at the time. It was for that reason that a rather smaller Committee was chosen on this occasion with a specific task.
I would like to suggest to the House that this task should be completed at the earliest possible moment. I would not like the terms of reference of this Committee to be expanded, so that we do not get a reply to what is an urgent question as soon as possible. I said earlier that more than half the Session
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has gone by. If we do clog the Committee up with too many questions and too much detail, we may not get an answer this Session, and most hon. Members would deplore that. I am not certain that if we were to consider any other questions, the size of the Committee would be the correct one.
The House will recollect that the previous Select Committee was rather larger. In considering this matter the House should have regard to an expeditious reply to the particular task set the Committee in the Lord President's speech of 14th November.
Mr. John P. Mackintosh: I apologise if I misheard my right hon. Friend, but did he say that the question was whether the House year should be the same as a calendar year? The actual wording is the financial year, and this opens up a rather broader set of considerations. Does he think that this should be considered by the Select Committee?
Mr. Silkin: The questions of the House year and the calendar year, or the House year and the financial year, are all considerations which, in my view, the Committee ought to take into account. I would hope that it would arrive at the best solution for the good of the House and country.
10.37 p.m.
Mr. David Steel: I am inclined to support this Motion and to press the Deputy Leader for some assurances about how he sees the rôle of the Committee on Procedure in future. When he says that half the Session has gone by, that is very true. Whenever I or other hon. Members with particular interests on certain procedures upon which they feel there should be review press the matter we are told by the Government that it is important that the Committee on Procedure deals with the point, that we must get an answer now about this question.
That is all very well, but we have been sitting this Session since October and there has been no Select Committee on Procedure sitting during this time. It could have been dealing with this matter and gone on to some of the other matters which various Members would like to see referred to it. The particular

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question which I am anxious should be referred to it, in addition to that which the Deputy Leader has announced, is a review of Scottish procedure. I have raised this before, when I was a member of the previous Committee. I thought that it should have the opportunity to review this. Again, I was told that it had such a crowded agenda—at that time its agenda was open-ended—that this could not be considered.
I would hope that the Government would consider the setting up of a subcommittee to consider Scottish procedure, and that this would not therefore clog up the work of the main Committee. There is ample precedent for setting up a sub-committee of a Select Committee, whose membership need not necessarily be taken entirely from the main Committee. One does not necessarily need to increase the size of the main Committee in order to set up a separate working party on a particular question.
May I just outline why I think the Government should consider establishing a sub-committee to look at Scottish procedure. There is growing uneasiness about the manner in which Scotland is governed, an uneasiness which is reflected and which is manifest both in election results, opinion polls, and, indeed, in the Scottish Press generally.
The Secretary of State for Scotland over the years has had further responsibilities added to him by successive Governments. Every time there is a plea for more devolution of power to Scotland, they say, "We will have another Under-Secretary of State" and hand over the powers in another field to the Scottish Office. There is talk, indeed, of handing over Board of Trade matters to the Secretary of State for Scotland.
This has gone on for so long that we now have a situation in which the Secretary of State for Scotland has executive responsibility equivalent to more than half a dozen Ministers in England. Therefore, when it comes to putting Questions to the Government, whereas the English hon. Member has the opportunity of putting Questions on different days of different weeks to different Ministers, hon. Members from Scotland have to save up their Questions relating to the interests of their constituents for the one
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occasion in five weeks when they are entitled to two Oral Questions to the Secretary of State.
Over the years this has put Scottish hon. Members in an invidious and inferior position in trying to question the actions of the Executive as they affect the livelihood of their constituents. It is my view—and I express it only as an opinion—that the Scottish Grand Committee could be used more effectively, and that we could have additional Question sessions in it. This is a point which I would like the sub-committee to consider as a practical proposal. The sub-committee should give consideration to the rôle of the Scottish Grand Committee itself. I think that it ought to meet on a more regular basis.
Apart from dealing with legislation, which it does very well, the Scottish Grand Committee only meets on between six and eight occasions every year for debates lasting two and a half hours. I am sorry if other hon. Members have not done their homework on this, but I have and there is not a single instance in the last few years where the Scottish Grand Committee has met on more than eight occasions in a year, though it is popularly thought in Scotland that it is a Committee working year in and year out.
Mr. John Brewis: But would the hon. Member not agree that the Scottish Standing Committee meets about 40 times a year, and that the composition of the Scottish Committee is often the same as that of the Scottish Grand Committee?
Mr. Steel: The hon. Gentleman cannot have been listening. I said that apart from legislation, which the Scottish Grand Committee does very well—and that, of course, covers the Scottish Standing Committee—it only meets between six and eight times a year.
We are having a debate tomorrow, for instance, on storm damage in Scotland, and that will be one of the eight debates. I should like to declare a constituency interest in this matter. The Stationery Office has just published an excellent and detailed Report on the Scottish Borders. It outlines a programme of development which would cost about £50 million between now and 1980 This is a very important Report, and I

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have requested a debate on it in the Scottish Grand Committee, but I am asking for one-eighth of the debates in so doing. I hope that a debate will take place on this Report, but if it does not it will be because the Scottish Grand Committee does not meet sufficiently frequently to enable debates of this kind to take place.
There is another matter which the subcommittee ought to consider—the composition of the Scottish Grand Committee. We have already had arguments on both sides in the previous debate which surely illustrated that there is something here which ought at least to be examined. The case for altering the composition of the Scottish Grand Committee should be examined and some conclusion arrived at. I take the view that it is right and proper that the Scottish Grand Committee should consist of the 71 representatives from the Scottish constituencies, and nobody else.
I cannot for the life of me see how it is that matters which exclusively affect Scottish constituencies should in any way be affected by the views of hon. Members who are not responsible to the Scottish electorate. If the argument is raised, as the hon. Member for Aberdeen, South (Mr. Dewar), who is always ready to leap to the defence of the status quo, argued, that this could mean an embarrassing situation for a Government who might not have a majority in the Scottish Committee but had a majority on the Floor of the House, I would say that it must be many years since we had a Division in the Scottish Grand Committee on anything except legislation. I do not think that there have been Divisions on the Estimates or on the general debates. This, therefore, is a theoretical objection.
Mr. Dewar Mr. Dewar rose—
Mr. Steel: Let me finish the argument. Even supposing that it happened and the Government were defeated—and it could happen—would this be a bad thing? Would it not be a good thing that it should be shown that the Government of the day did not appear to command the support of the representatives of the people of Scotland and that the Standing Order should be so altered that if something failed to get through in the
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Scottish Grand Committee, the Government would have to get it through on the Floor of the House with its English majority to steamroller it through? It would be an excellent thing to show up such a procedure. This is a matter which should be investigated by such a Committee on Procedure.
Mr. Dewar: Is the hon. Member suggesting that English Members be excluded from the Scottish Grand Committee only on subject days, or also on Second Readings?
Mr. Steel: I am suggesting that if the House has given approval for a Bill to be sent to the Scottish Grand Committee for a Second Reading, the Second Reading should take place and should be debated among the 71 Scottish Members and no one else. The House could object to this on the formal Motion when it came forward. It is not true, therefore, to say that the Government would lose all control over legislation.
Another point to be considered is where the Committee meets. I take the view—I think that it was the right hon. Member for Edinburgh, East (Mr. Willis) who raised this—that there is a very good case for the Committee meeting on at least some occasions in Edinburgh. I say this not because I think that it would be a Government gimmick, but because it would bring the Government nearer the people. There is a great feeling in Scotland that, somehow, the whole processes of Government are remote from Scotland and that everything goes on down here in London.
I see no reason why we should not encourage more Members of Parliament to spend more time in Scotland or why we should ferry civil servants from Edinburgh to London for debates, instead of keeping them in Edinburgh and bringing the Members instead to Scotland for debates.
I believe, too, that we could move ahead of the House. Although this may be more controversial, I see no reason why we should not involve the Scottish television networks in televising our proceedings and bringing the whole processes of our discussion much nearer home. When I published a booklet recently on this subject it received varied comment in different sections of the Press.

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One comment on this proposal, however, which came from one or two quite distinguished newspapers, was that the Scottish Grand Committee was a bit of a joke anyway and that to move it to Edinburgh would be quite useless. This would show the whole thing up. If it did, again so much the better.
If the result of having the Scottish Grand Committee in Edinburgh was to convince the people of Scotland either that they should change some of their representatives or that the Committee was useless and should be replaced by a more powerful body, that would be something which I would very much welcome.
There are various points that I should like the Government to consider. There is a question whether there is not a case for setting up a Select Committee of the House to investigate the workings of the Scottish Office. This, again, is a matter which we have raised before. When the Committee on Agriculture was set up, it had no power to investigate the Scottish Agriculture Department. When the Committee on Education was set up, eventually, under pressure, it was agreed that its powers should be extended to cover the Scottish Education Department.
There is, however, a case for having a Select Committee of the House, composed of Scottish Members, able to meet in Edinburgh and to bring before it not just Ministers and Under-Secretaries of State, but the civil servants as well, and to question them on the administration and effective operations of the Scottish Office.
It was rumoured in some Scottish papers in February, and March and in The Guardian in the last few days, that the Government are thinking seriously of this proposal. I hope that the Deputy Leader of the House will be able to give us an inkling about this tonight.
I would like to go further than any of these proposals, but we are confined in this debate to considering proposals within the present constitutional framework of the House of Commons. The Government should not imply that everything in the Scottish garden is lovely, because that is not the thinking of the people of Scotland. We should use the present constitutional procedures to get improvements in the government of Scotland, and that is why I would like this to be considered.
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In answer to a Question, the previous Leader of the House said to me on the Floor of the House that there was a case for setting up a Committee on Procedure to do all the things I have been proposing. It is not good enough to say that some time we might get round to it.
10.52 p.m.
Mr. George Willis: Although I do not agree with some of the things he said, by and large I am in agreement with the hon. Member's approach to this question. This is not the occasion on which to discuss the wide question of Scottish government. What is raised is whether or no, in discussing procedure, we can devise a more democratic instrument in the present set-up to reflect the wishes of the people of Scotland. This is something we should continually be doing in this House through the Committee on Procedure.
When I look back, I find that since I have been in this House we have made considerable changes. I am not suggesting that they have been sufficient, or have gone far enough. When I came the Scottish Grand Committee did not have subject days or Estimates days but only Second Readings, and there were Committees on Bills. In 1948, we had the proposals of my right hon. Friend the Member for East Stirlingshire (Mr. Woodburn), which gave us the opportunity to discuss Estimates. Later, as a result of the Committee on Procedure's work, we added the right to have two subject motions each Session, which would give the right to discuss matters such as the suggested Border Plan, and the right to set up Standing Committees. This has been done. There is now a second Standing Committee.
We have had to examine this for a long time. My hon. Friend the Member for South Ayrshire (Mr. Emrys Hughes) and I raised some of these questions in debates on Scottish devolution 20 years ago. We proposed that more should be done to strengthen the Scottish Grand Committee. I do not want to discuss the merits of meeting in Edinburgh. I am not certain whether it is good or bad, although I have suggested it in the past. The first to suggest it was the late Mr. Tom Johnston, the Secretary of State, who enunciated the idea. Nevertheless,

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there are things which can still be done within the framework of the Scottish Grand Committee. There is the business of Questions, about which there are difficulties. My hon. Friend the Member for Motherwell (Mr. Lawson), although he criticised us rather fluently about this, knows some of the difficulties and that we have often considered this and have met representatives of the Committee on Procedure about Questions in the Scottish Grand Committee.
Therefore, there is a case for considering procedures. There is also a case for considering the composition, in view of what my hon. Friend the Member for Motherwell (Mr. Lawson) said. He gave a very flowery description of the great contribution made by English Members in the Scottish Committee. I have never heard so much nonsense in all my life.
What happens? As soon as an hon. Member is elected to this House, either as a member of the Opposition or on this side of the House, he is put on the Scottish Committee if English Members are wanted. There is no honour about it. It is a chore that English Members do not like. Let us be quite honest about this and dismiss the humbug my hon. Friend has been talking about the great contribution—
Mr. David Steel: Will the right hon. Gentleman accept that appointment to the Scottish Grand Committee is sometimes held out by the Whips as punishment for naughty boys?
Mr. Willis: I do not know what goes on in the Whips' offices. On one or two occasions there have been English Members who have made contributions, but by and large they have contributed nothing. The point that I made in the earlier debate was that when there was no necessity for balancing up by introducing Scottish Members, and even where the bounds were not easily reached without English Members, which was the point made by the hon. Gentleman, we ought nevertheless to look at it. But where there is no need to have English Members, I cannot see why it becomes necessary. The effect of having an English Member, for instance, on the Social Work (Scotland) Bill, which affects every Scottish constituency, is that a
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representative of a Scottish constituency is kept off in order to put somebody on the Committee who could not care two-pence about it. The hon. Member for Aberdeen, South (Mr. Dewar) nods and shakes his head, but it is what happens. It is a practice of the House, and when my hon. Friend has been in the House for ten or fifteen years he will know that.
Mr. George Lawson: My right hon. Friend perhaps recalls that the hon. Member for Hendon, South (Sir H. Lucas-Tooth) especially asked to be put on the Scottish Grand Committee on the last occasion when they met. He made an excellent speech. He was very concerned with the Bill we were discussing and its possible implications for his part of the United Kingdom. He made a contribution. Had he been debarred from the Committee he would have had a legitimate complaint. Surely this is a position we wish to maintain?
Mr. Willis: I am debarred from a number of Committees which I would like to be on, but I have to make representations to a member of the Committee to express my point of view. With great respect to the hon. Gentleman who attended the Committee, he made a valuable contribution, but I am not certain that contribution could not have been made by the lawyers on the Committee from our own ranks. Some hon. Members are kept off Committees when they would like to be on them.
Mr. Lawson: By Statute.
Mr. Willis: By limitation of the numbers on the Committee. I do not wish to go into the matter of who is debarred and the reasons for that, but nevertheless they are debarred. I am suggesting that in the case I raised on the previous Amendment the membership should be restricted to Scottish Members when there is a clamour, and Scottish Members who ought to be on the Committee are sometimes kept off.
I think that the membership of the Scottish Grand Committee should be looked at, and the views expressed by the hon. Gentleman should be examined. Either we believe in democracy, or we do not. Either we are bureaucrats or we are democrats. One of the dangers today is that democracy looks like disappearing,

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because increasingly we have centralised government, whichever party is in power. They extend their powers over increasing sectors of our lives. Socially, industrially, economically—the Government are entering into almost every sector, not because they want to but because the people demand it. We ought to ask ourselves whether our democratic machinery is measuring up to the changes, and we do not do enough of this.
My hon. Friend the Member for Berwick and East Lothian (Mr. Mackintosh) pointed out quite rightly the enormous number of ad hoc bodies which we create. They are responsible to the Secretary of State, but how do we get at them? It must not be forgotten that we have a job to do as well. No one is criticising, but one must point out what is happening and, as I have been saying for 20 years, we have to ask ourselves whether we are measuring up democratically. Is there a feeling of frustration and a feeling of not knowing who is who? Do people say that "they" do this, without knowing who "they" are?
That is what is happening in the country today and, in a small measure, the hon. Gentleman's suggestion to examine the whole basis of the Scottish Grand Committee to see whether anything can be done to improve matters is a useful one. It ought to be taken seriously by the Government.
11.2 p.m.
Mr. J. Grimond: I want to address myself to the need for a Select Committee to examine the workings of the Scottish Office. However, before I come to that, I want to make the general point that this House and, through it, the country should be much better informed about the way in which Government decisions are reached, about the information upon which they are reached, and about the pressures which lead to them.
It is obvious that hon. Members of this House are among the last to be consulted. All sorts of bodies are consulted before legislation is drafted, but not hon. Members. It can be argued that this is a proper process and that hon. Members should be kept at arm's length from the Government. But if we follow that through, we should take drastic measures
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that they have some power. I agree with the right hon. Member for Edinburgh, East (Mr. Willis) that they do not have power. But if they do not have power to criticise or thwart the Government, at least they should be brought in earlier into the decision making process and should know more about it.
If I may give three examples, we were told that sanctions against Rhodesia would work in a matter of weeks. They did not. We were told that this country would get into the Common Market. The Prime Minister told us that we would not take "No" for an answer. We have not got in. In both those cases, were the Ministers concerned badly advised, or are they the results of political mistakes of their own? I have not the advice open to Ministers but it seems I was right on such matters and they were wrong.
Mr. Lawson: On a point of order, Mr. Deputy Speaker. We are discussing a Select Committee on Scotland. Except for the Select Committee and a possible debate on a sub-committee to examine the procedures of the Scottish Grand Committee, there is nothing about the Select Committee meeting in Edinburgh. Is it in order to go on discussing this all night?
Mr. Deputy Speaker (Mr. Sydney Irving): Order. Mr. Speaker allowed a rather wider scope than the precise terms of the Order. I think that the right hon. Member for Orkney and Shetland (Mr. Grimond) is getting a little wide of the Amendment on the Order Paper.
Mr. Grimond: I appreciate your Ruling, Mr. Deputy Speaker. But I am entitled to give examples of why a Select Committee is necessary, and we are entitled to say why a sub-committee is necessary and why its powers should be broader than those suggested to us by the Deputy Leader of the House.
My last example is that it does not appear that any contingency planning was made in the Treasury for devaluation. These matters should be examined in relation to the structure of government in general.
The Scottish Office is one of the most complicated offices in the whole field of government. As my hon. Friend the Member for Roxburgh, Selkirk and Peebles (Mr. David Steel) pointed out,

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its duties and its relationship to this House and to the Scottish Grand Committee have grown up piecemeal over the years. I agree that it is high time we had an investigation into whether this relationship is right, whether the division of work in the Scottish Office is right and whether the Scottish Office is equipped with the people, who are able to take the type of decisions which it is supposed to be taking. These are all proper subjects for a sub-committee to examine.
There is one further matter of great importance. What is the relationship of the Scottish Office to the rest of the Government? It is inconceivable that some of the measures which have lately been brought in, such as the Transport Bill and the Selective Employment Tax, could have been brought in if the Scottish Office had real influence with the Government. In Scotland there is a great body of opinion in favour of devolution, and the people of Scotland should be informed about the facts of life in Scotland as much as possible.
Yet every hon. Member knows that it is difficult to find out the basic statistics about Scotland. On these grounds, it is extremely important that Scottish Members should press upon the Government the necessity for setting up such a subcommittee, and it should examine the functioning and structure of the Scottish Office, the statistics relating to Scotland and the relationship of the Scottish Office to the rest of the Government.
I appreciate that it is late in the Session, but, after all, this is the fault of the Government. This is one of the very few debates that we have in which the structure of government can be examined, and when we get this opportunity we are fully entitled to put on record what we regard as the needs of the situation. If the Government are not prepared to do what we request in this Session, perhaps they will do so next Session.
We should like to know whether the Government intend to set up a committee to sit in Edinburgh. We should also like to know whether such a committee, if set up, would be entitled to examine any increase in the powers of Scottish Members over their own business. The question whether English Members should be on the Scottish Grand
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Committee is an important matter which I do not intend to go into at this time of night, but I often feel that the Government leader on the Scottish Grand Committee should be entitled to cast five or 10 votes and that would be that. But if this were known in Scotland I do not think it would do the Scottish Grand Committee much good. This is a matter on which people in Scotland ought to be much better informed than they are.
I hope these points will be scrutinised by the Government. It would be out of order to examine the case for devolution at this moment, but we must at least take note of the desire in Scotland for better and more democratic government—government which is nearer to them and which they can influence. If we are to have a serious debate about devolution the people of Scotland must be told more about the facts of government than are available at present.
11.9 p.m.
Mr. John P. Mackintosh: I should like to start by considering the Motion that was withdrawn and then re-submitted on a slightly different subject, and to consider the actual terms of reference specified on the Order Paper.
I think it is a little regrettable if the Government get into the habit of only appointing a Select Committee on Procedure when they want it to do a specific job for the Government. This attitude that the Select Committee on Procedure exists to consider one type of task but not to consider broader issues and not to consider general problems put before the House is a great mistake.
When I first came to this House I was put on this Committee, much to my pleasure, for which I thank the Deputy Leader of the House, or his predecessor. Nevertheless, I was surprised to find that when one attended one of these Committees the Chairman was nominated by the Government. I do not criticise this, in the sense that he was a good Chairman, but I object to the idea, when one is given specific points to consider, that if there is real difficulty something like a Whip is applied in the Committee.
This type of approach is not in keeping with the spirit in which the Deputy Leader of the House and the past Leader

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of the House approached the question of Parliamentary reform. I appreciate the point that we would not have got much Parliamentary reform but for goading from the Front Bench, but there are times when the House could be given its head and a great deal of useful matters might be considered.
I should like to have seen a Select Committee on Procedure appointed last October with no restrictive terms of reference. We want a system by which 25 or 30 Members of the House signing a Motion could get a Select Committee on Procedure to look at something in which they were interested. That Committee would report, and it would be a matter for the House and the Government to determine their attitude and reply to the question. I do not think it satisfactory that our procedure should be exclusively in the control of the Government in terms of what they do or do not allow the Committee to look at. Had the procedure that I have suggested been adopted, we would not need, by twisting the forms of order, to make tonight into a debate on Scottish government. We would simply have 25 or so Members sign a request that the Select Committee on Procedure look at the matter. If it did look at the matter, it would not go into the merits, but the procedural complications, and, when it reported, the House would have the matter before it for discussion.
On the terms of reference, I intervened in the speech of my right hon. Friend the Deputy Leader of the House to ask about the meaning of the term "financial year", because I gather that he gives it a narrower meaning than I had hoped. I should have liked the Committee to look at the whole question of our control over finance and public expenditure. It seems shockingly inadequate or virtually non-existent, especially when we get a situation where, under the Plowden Committee's new arrangements, the Treasury's financial year is a five-year rolling programme which moves forward year by year, while the procedures of the House are still working on a 19th century annual budgeting basis totally incompatible With that of the Treasury. It is not surprising that we get into a state of total ignorance about the levels of public expenditure and that our chances of controlling it are so remote. I think that
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if the financial year is the same as the calendar year it will help to meet this problem.
There is, to my mind, a vast amount of enthusiasm for Parliamentary reform which such a Select Committee could consider. I think, therefore, it is a pity that we have it appointed towards the end of the Session and with highly restrictive terms of reference.
On the two Amendments that were added, I agree that Question Time, although it was considered by the past Committee on Procedure, might be reconsidered, because new problems are steadily arising.
I agree with a lot that has been said by the hon. Member for Roxburgh, Selkirk and Peebles (Mr. David Steel), I do not think that it is right to suggest the setting up of a rather packed sub-Committee. I am grateful to the hon. Member for Roxburgh, Selkirk and Peebles and his colleagues for nominating me for the sub-committee, without consulting me, but the setting up of a sub-committee of the Select Committee on Procedure should be a matter for that Select Committee to decide. I agree that such a sub-committee should be comprised of Members both in favour of and against any change. I do not want procedural implications. It is for the Government and the House to take their separate standpoints.
There is still enough interest in Parliamentary reform to keep up the momentum that the Deputy Leader of the House and the past Leader of the House established in this matter. I am deeply concerned that this enthusiasm for reform will run into the sand if we get Select Committees set up for a few months on what are trivial points compared with the careful scrutiny and control of the Government, with which we are concerned.
11.15 p.m.
Mr. Donald Dewar: A few moments ago, the hon. Member for Roxburgh, Selkirk and Peebles (Mr. David Steel) remarked that I was over-quick in jumping to the defence of the status quo. I hope that he will not be alarmed when I jump to his support in this discusson. Perhaps that is not so peculiar or out of line as it sounds, because Liberals are a remnant of the past,

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if not of the status quo, so this would not be breaking the rules.
There was a lot of sense in what the hon. Member said, and I support a large number of points he made. I agree with what he and the right hon. Member for Orkney and Shetland (Mr. Grimond) said about a Select Committee. We should have one looking at the way in which Scottish government is run, but I would sound a note of caution. We could hear the argument, once committees were set up on agriculture, fuel and power and a large number of Ministry subjects covered by the Scottish Office, that we should have a whole series of Scottish Select Committees covering those fields rather than one covering the whole gamut.
On the matter of Question Time, as my hon. Friend the Member for Berwick and East Lothian (Mr. Mackintosh) said, there is a strong prima facie case. That should be thrown open to public discussion, but it should be looked at carefully.
I think there is self-evident unease about government in Scotland and discontent, although we are perhaps a little over-anxious to assume that in some way we uniquely suffer from that unease and discontent. We find it in many parts of the United Kingdom at the moment. I am not talking only in political terms, but in constitutional terms. Talking about alienation of the people and that they are removed from and not involved in government is not a peculiarly Scottish complaint. But let us investigate it. I am not sure that this Committee would be the right vehicle for that, not because of what my hon. Friend said about its composition, but because it has to be done on a broader and very much more intensive scale.
I do not want tonight to go into the argument which has been hovering around the debate as to what extent English Members should be allowed in the Scottish Grand Committee. I think the hon. Member for Roxburgh, Selkirk and Peebles was trying to have his cake and to eat it when he suggested that if English Members wanted to stop something going to the Committee there would be the unfortunate result that they could do so in this House. That seemed to vitiate the kind of move the hon.
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Member advocated. If we move in this direction too rapidly, although obviously this is something which we should discuss, we would be writing a prescription for anarchy. I have no objection to a Committee which investigates at an objective level. That is excellent, but if we do it with the Scottish Grand Committee we could contrive a situation in which we might have a completely different political complexion from that in the House as a whole and we might invite a head on clash. I am not sure that that would be a desirable situation. This is obviously the kind of thing which should be discussed. If we could have a broadly based Committee prepared to go into this in depth, I would be in favour.
The right hon. Member for Orkney and Shetland and the hon. Member for Roxburgh, Selkirk and Peebles suggested that deliberations should be moved to Edinburgh. This may be tinkering with the situation. It might have a passing popularity, but if it is thought that it would remove the discontent about which the Liberals talk so eloquently, I think it a misapprehension.
Mr. David Steel: I have never argued that that in itself would remove the discontent. The hon. Member knows that I should like to see a Scottish Parliament. But this proposal at least would be an improvement on the present system by bringing Government nearer home.
Mr. Dewar: I do not think that it would be an improvement. There is an important argument about devolution and a Scottish Parliament, but too many people talk glibly about a Scottish Parliament without deciding what they mean by such a Parliament and what should be its powers. This is an argument which we must settle among ourselves and soon, but there is no point in trying to go for some shadowy halfway stage which offers no improvement. We must make up our minds on the question of reform and settle the issue in the immediate future, once and for all.
Mr. Willis: Does my hon. Friend subscribe to the view which was expressed in favour of a Scottish Grand Committee meeting in Edinburgh—that the affairs of the people ought to be discussed as near as possible to the people?
Mr. Dewar: My right hon. Friend overvalues the importance of physical proximity. I do not think that the citizens of Glasgow feel closer to Glasgow Corporation, or the citizens of Aberdeen feel closer to Aberdeen Corporation, merely because town council and the city chamber are within the centre of the geographical boundaries called Glasgow and Aberdeen. There is much more to it than that.
In broad terms, I support the hon. Member for Roxburgh, Selkirk and Peebles when he calls for investigation and discussion. It can do no harm in this case, although I am not sure that it will lead to the important improvements for which he hopes. At best it could produce interesting ideas and possibly some constructive ideas, and that I welcome. My objection to the kind of debate which we have had tonight is that it has not all been constructive. I hope that no one will take it amiss if I say that some of the speeches have been made very much with the discontent in Scotland in mind about which we have been talking and with the idea of adding fuel to it.
11.22 p.m.
Mr. Emrys Hughes: This is a very interesting debate. One of the most interesting points about it is that it has occurred because of an accident. The Deputy Leader of the House explained that a certain disturbance took place in the House on Thursday and that as a result the business had to be entirely re-examined, and we have had this Motion. From the debate the Deputy Leader of the House will realise that there is strong feeling in Scotland on the subject, and that he has seen only the tip of the iceberg.
I agree entirely with the hon. Member for Roxburgh, Selkirk and Peebles (Mr. David Steel). Indeed, I would probably go further than he went. When are we to have a serious attempt to modernise the Government of Scotland? I have here a pamphlet which was distributed from Transport House. I will not weary the House by quoting from it, but it was in our election manifesto that we stood for the modernisation—
Mr. Deputy Speaker: Order. The hon. Member is going wide even of the Amendment in talking about modernising the Government of Scotland. He
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must relate his speech to the Amendment or to the Motion.
Mr. Hughes: Thank you, Mr. Deputy-Speaker. I was coming to that. It was a preface. I am arguing that in his Amendment the hon. Member for Roxburgh, Selkirk and Peebles is asking for the modernisation of Government. That is why he wants a sub-committee. Far from over-estimating his case, he moderately under-estimated it. He referred to the eight meetings of the Scottish Grand Committee which have considered matters affecting Scotland.
How absurd it is that, under our present procedure, we cannot in the Scottish Grand Committee discuss a matter which is agitating the minds of Scottish people more than any other social issue, namely, the serious question of crime in Scotland. What opportunity has the Scottish Grand Committee to consider this, perhaps the greatest social problem of our time?
Mr. Dewar: A week on Thursday.
Mr. Hughes: Exactly—and how much time shall we have a week on Thursday? One morning. There will be two long opening speeches from the front bench on either side, there will be two long speeches in winding up, and nearly all the unfortunate Members sandwiched in between will be disappointed. It is a travesty of debate, a travesty of consideration of a great social issue. If we were realists, we should meet in Edinburgh, spending two days discussing the problem in as much detail as the Scottish Press is now discussing it.
The Under-Secretary of State for Scotland (Mr. Norman Buchan): The subject has been discussed at reasonable length on the Floor of the House twice since Christmas, I think—certainly once at considerable length only two or three weeks ago.
Mr. Hughes: Yes, but in a most superficial way. We never get to grips with it. I have asked my hon. Friend the Under-Secretary of State Questions, he says, "We are considering it", and that is the last we hear for another five or ten weeks.
Mr. Buchan: I think that my hon. Friend has misunderstood. I am referring not to Question Time but to debate, two debates, on the Floor of the House.
Mr. Hughes: I cannot recollect any adequate debate on crime in Scotland during all the time I have been a Member of the House. I have heard small debates, which begin at half-past 10 and usually finish at one o'clock, in which many hon. Members do not have a chance to put the point of view of their constituents. The absurdity is shown by what my hon. Friend the Under-Secretary of State has to do. How can he possibly present the question of crime to the House when he has, for example, to consider agriculture as well? How often has agriculture been adequately discussed in the Scottish Grand Committee during the time I have been a Member? Ministers read out their briefs for the benefit of the Press. The spokesman for the Opposition does the same. As for the debate, if my hon. Friend the Member for the Western Isles (Mr. Malcolm MacMillan) comes along, the rest of hon. Members representing agricultural constituencies have little or no chance.
We do not have adequate consideration of the problems of Scotland. My hon. Friend the Member for Aberdeen, South (Mr. Dewar) does not agree that the Scottish Grand Committee should meet in Edinburgh. I do. If the Grand Committee were just to put its toes in the water to find the temperature, even if we met for a couple of days during the Recess, it would show the people of Scotland that we were there on the spot. I do not see why we could not have a week in the Long Recess discussing Motions on subjects affecting the people of Scotland, with two or three days in the Easter Recess and two or three days in the Christmas Recess. That would not satisfy or appease the Scottish Nationalists. They would characterise me as a reformist, whereas I am really a revolutionary.
Without interfering too much with the machinery of the House of Commons, and without interfering with the mumbo-jumbo of the House, we could meet in Edinburgh to discuss matters like crime, the problems of education, the problems of the future organisation of industry, and so on in such a way that the people of Scotland would realise that we were not lost in Westminster and their problems were being adequately considered.
Look at our experiences in the past six months—the Sewerage (Scotland) Bill,
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when we discussed the pollution of Scottish rivers in a Committee room overlooking the banks of the Thames, and then the Erskine Bridge Tolls Bill. The more we look at it, the more we realise that if we are to modernise this Government we need immediately to set up a Select Committee mercilessly to cross-examine leading civil servants in Scotland and the Ministers, because I believe that the nationalist movement is not a romantic or sentimental movement. It is a demand by common-sense people for the reorganisation of democratic Government to make it more businesslike and more effective, and to express the will of the people.
Therefore, I think that the hon. Member for Roxburgh, Selkirk and Peebles and the un-hon. member who jumped from the Public Gallery did a public service in forcing this debate upon us. I hope that these words of wisdom will not be lost on my right hon. Friend the Deputy Leader of the House, who I know is receptive to new ideas, and that he will realise that if he comes forward with a Motion which will give us an opportunity of a much more searching examination of Scotland he will be doing a service to the House, the people and Scottish Members.
11.32 p.m.
Mr. John Silkin: With the leave of the House, I would remind the House that the way in which the Motion is worded is the only means we could envisage to enable the hon. Member for Roxburgh, Selkirk and Peebles (Mr. David Steel) to raise and other hon. Members to raise their points.
I must confess that I had not realised quite what sort of debate we should have. There were moments when I thought that I was in the Scottish Grand Committee, particularly when my hon. Friend the Member for South Ayrshire (Mr. Emrys Hughes) was talking about crime in Scotland, education and Scottish industry. It was only when the right hon. Member for Orkney and Shetland (Mr. Grimond) dragged us back to earth with a discussion on Rhodesia and the Common Market that I realised that we were on a procedural Motion.
I do not want to go very much into the merits or demerits of devolution, Scottish Grand Committees, the growth of

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nationalism or any other allied subject. For one thing, I am the only non-Scot to have spoken in the debate, as far as I can see, and I have enough regard for my life not to intervene too much on such subjects. Furthermore, not every Scot, apparently, agrees with every other Scot. Indeed, there are even people in the constituency of my hon. Friend the Member for South Ayrshire who do not necessarily agree with him.
What I think has emerged from this evening's debate is not only that Scottish but also English and Welsh Members are very much concerned with the procedure of the House, perhaps more so than at any other time for 30 years. There is a great deal to be said for a hard-working Select Committee on procedure.
This is a deliberate act on the part of the Government. My hon. Friend the Member for Berwick and East Lothian (Mr. Mackintosh) and the hon. Member for Roxburgh, Selkirk and Peebles did not do themselves sufficient justice. The previous Select Committee on Procedure was extremely hard-working—the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) would say too hard-working in some respects.
Mr. John Boyd-Carpenter: Not too hard-working; misdirected.
Mr. Silkin: At any rate, it was energetic. It was felt that a short rest might not be a bad thing, but my right hon. Friend the Leader of the House and I are very much seized of this enormous interest in procedure and, now that our second wind has been obtained, we might consider further a rather bigger and much wider Select Committee on Procedure which would deal with the matters which have been raised.
Obviously, I am not in a position at this moment—it is a matter for the House—to give an assurance that at the next Session these matters will form part of the terms of reference of the Select Committee on Procedure, which can itself decide what it wants to discuss, as it did in the last three Sessions. However, we have learned a great deal tonight and cer-
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tainly Scottish procedure is a matter which the Select Committee might consider. So are a Scottish Question Time and English Question Time.
However, I hope that in the next Session a new slightly bigger Select Committee on Procedure will be allowed to consider many topics rather than the narrow matter which we gave it.
Mr. David Steel: Is the right hon. Gentleman's mind open to the possibility, which was the basis of my argument, that we should not leave the item of Scottish procedure among the other things which the Select Committee might discuss, but that it should be specifically made a subject for a sub-committee, which is a reasonable way to deal with it?
Mr. Silkin: I am not directing a closed mind to that possibility, but it is something which the Select Committee might consider. After all, the Select Committee on Science and Technology has proliferated, if that is the word, and this is one subject among others for which there might be a sub-committee.
My hon. Friend the Member for Berwick and East Lothian said that the Select Committee should not be given a purely specific task, but should be allowed to wander wide. I agree, but on this occasion there is tremendous advantage to every hon. and right hon. Gentleman, because we all know that in the modern world the Parliamentary year has become a little disorganised, a little out of synchronisation. Because of this, the sooner the whole of this matter is considered, the better.
We have paid tribute to the reforming zeal of my right hon. Friend the Lord President of the Council. I should like to pay tribute to the reforming zeal of so many hon. Members. I assume that my hon. Friend the Member for South Ayrshire (Mr. Emrys Hughes) would like me to pay tribute to the accident which caused this debate. It has been a very instructive debate and perhaps it is an interesting comment on our procedure that, the debate having taken place, I should now ask the House for permission to withdraw the Motion.
Motion, by leave, withdrawn.

LETTER (MISDELIVERY)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Armstrong.]
11.40 p.m.
Mr. Anthony Royle: I welcome this opportunity to raise the case of one of my constituents, and I apologise to the Assistant Postmaster-General for dragging him here at this late hour, although I fear that he has not had the pleasure that I have had of listening to Members from North of the Border talking for the past few hours. I would also like to apologise to him for the short notice given, as it only became apparent after luncheon today that it was possible for me to obtain the Adjournment debate.
I wish to raise the case of one of my constituents, Mrs. Parker, who lives at 9 Taylor Avenue, in Kew, in my constituency of Richmond. She has suffered a personal loss totalling approximately £114. This is entirely due to two reasons, both of which are based on Government incompetence. One is the inefficiency of the Post Office and the second is devaluation of the £.
The story briefly is as follows. Mrs. Parker had a friend in Germany and she wished to repay to that friend the sum of £783 13s. 3d. She applied to the Bank of England, through her own bank, for clearance for this money to be paid to her German friend, and in due course a letter came from the Westminster Bank, postmarked 3rd November, 1967. It was wrongly delivered by the Post Office to No. 7 Taylor Avenue, Kew. Unfortunately, and this is a chanter of misfortunes, the neighbour who lived there was away on holiday. Immediately he returned from holiday, on 18th November, 1967, he handed the letter over to Mrs. Parker. But before she received the letter giving her permission to transfer the money the £ had been devalued.
As the £ had been devalued, the cost to Mrs. Parker to send the money out to Germany to repay the loan cost her £114 extra, out of her own pocket. This was entirely due to the misdelivery of the letter and the devaluation of the £. Ever since that time I have been trying to obtain repayment for my constituent. On
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29th November, 1967, her husband received a letter from the Head Postmaster in Richmond which admitted the error. Mr. Burgess, Assistant Head Postmaster there, said:
"I have had a full enquiry made into the misdelivery, and the postman at fault, a new entrant to the Post Office, has been identified and suitable disciplinary action taken against him. He has also been told of the need to exercise greater care in future when carrying out delivery duties."
A further letter was received by Mr. Parker from G.P.O. Headquarters dated 5th December, signed by a Mrs. Hollington. It said:
"I am very sorry to learn about the misdelivery of your letter to 7 Taylor Avenue. This type of error can only be attributed to carelessness and, as you are aware from the Assistant Head Postmaster's letter, the postman at fault has been suitably taken to task. As a result I hope you will have no further reason to complain."
There was good reason for further complaint. My constituent had still lost £114. Following this I raised the matter with the then Postmaster-General. In a letter to me written by the right hon. Gentleman and dated 29th December, he said:
"I was very sorry to hear that Mr. Parker had suffered such a heavy financial loss due to devaluation "—
admitting here that it was partly due to devaluation—
"but I regret that I cannot alter the decisions already advised by the Director of the London Postal Region. The Post Office does not pay compensation for the loss, damage, delay or misdelivery of anything sent in the unregistered post; nor do we pay compensation for consequential loss.
"I appreciate that this may seem unreasonable to Mr. Parker. But we handle about 35 million unregistered letters daily; if we were to depart from the principle of not paying compensation it would impose an impossible liability on us."
Thirty-five million unregistered letters daily! How many of these letters were sent prior to devaluation and delivered after devaluation, and how many of these letters during that time were sent or delivered to the wrong address?
Following this letter, which, of course, was very unsatisfactory, I raised the matter with the Parliamentary Commissioner, Sir Edmund Compton, but he replied that he was not empowered to investigate such a case. I therefore tabled Parliamentary Questions on 25th January, 1968, and 7th March, 1968. I asked the

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Assistant Postmaster-General, who is here this evening, if he would seek to make an ex gratia payment to Mrs. Parker.
He replied
"No, Sir. To do so would open the door to an unlimited compensation liability which we could not possibly take on."—[OFFICIAL REPORT, 7th March, 1968; Vol. 750, c. 632.]
Again I would ask how many other letters went astray like this at the time of devaluation? How many other people lost £114 or some similar sum as a result of devaluation and misdelivery?
I raised the matter personally with the last Postmaster-General, and it was passed on to the new Postmaster-General who took office recently. Again, I asked the new Postmaster-General if an ex gratia payment could be made, and again this was turned down. Why will not the Post Office pay this money out? The continual excuse made in all this correspondence and in the exchanges in the House has been "we are not going to pay compensation for consequential loss—we never do", or "we cannot set aside a principle", or "it would impose an impossible liability on us."
I accept that in the normal case it is perhaps not possible for the General Post Office to take on the burden of paying claims for consequential loss. This is understandable, and I accept it. I can also see that they would not be willing to set aside this principle if it could result in a flood of similar claims. But I find quite incredible this statement that this case might impose an impossible liability on the Post Office. This case is not a normal case. As I have indicated, I think it is very much an exceptional one.
In the letter sent to me by his right hon. Friend the last Postmaster-General his right hon. Friend said
"…we handle about 35 million unregistered letters daily; if we were to depart from the principle of not paying compensation it would impose an impossible liability on us."
The only thing I can presume from that—unless there have been a large number of claims resulting from devaluation and misdirection—and I would be grateful if the Assistant Postmaster-General would answer this specifically—is that perhaps in the future there might be another devaluation with a spate of claims. I am sure the Assistant Postmaster-General would not wish to imply this, and nor would the right hon. Gentleman the last Postmaster-General.
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This large loss to my constituent has been caused by the admitted incompetence of the General Post Office. They have admitted that the original letter from my constituent's bank was misdelivered to the wrong house and have admitted that they were at fault by dealing firmly with the postman who was at fault by disciplinary measures. The Government are also at fault in that this loss would not have occurred if the economy had not been mismanaged so badly during the past three years. Mismanagement that resulted in devaluation. Now is obviously not the time and place to go into that, but it is part of the two-pronged blame the Government must accept—firstly, the inefficiency of the postal service, and secondly the devaluation of the £.
Finally—and I thank the Assistant Postmaster-General for listening to my plea so patiently—my constituent, Mrs. Parker, cannot sue. She cannot go to court and sue the Post Office. How many other cases has the hon. Gentleman received like this one? I should be very interested to hear his reply to that. It seems to me that it is only common justice that the Assistant Postmaster-General should think again. I know that he is a decent and reasonable man. I am sure that he would not like to lose the large sum of £114 and receive nothing but sympathy. He would not like to find it quite impossible, through the courts of law, through the Parliamentary Commissioner or, indeed, through the House of Commons, to be able to get justice for his case.
Therefore, I ask and beg the Assistant Postmaster-General please to think again, to ignore the official advice which has been pouring into his ears over the last three months and to make a generous ex gratia payment to my constituent.
11.51 p.m.
The Assistant Postmaster-General (Mr. Joseph Slater): The hon. Member for Richmond, Surrey (Mr. A. Royle) has been most persistent in raising this matter on behalf of his constituent. He is a very good advocate for his constituent, and I certainly do not complain about that. Although the hon. Member has mentioned many of the facts of his case, it is my responsibility to put the Post Office point of view on record.

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It is true, as the hon. Member has stated, that Mrs. Parker, who lives at No. 9 Taylor Avenue, Kew, received an unregistered letter containing the authority of the Bank of England to remit sterling abroad and that it had been posted to her on 3rd November, 1967, by the Westminster Bank. There is no question that the letter was not correctly addressed to No. 9 Taylor Avenue but, unfortunately—the hon. Member has brought this out, and this is the mistake from which the whole sorry tale has sprung—the postman who was responsible for delivery on the occasion in question delivered the letter to No. 7 Taylor Avenue instead of to No. 9.
It so happened that No. 7 was empty at the time, as the occupants were away on holiday, and they did not discover it until a fortnight later when they returned when, naturally, they handed it over to Mrs. Parker. In the meantime, as the hon. Member has cited, the £ had been devalued, and Mrs. Parker says that as a result of the delay in the delivery of the letter to her, the sum of £783 13s. 3d., which she was due to remit to someone in Germany, needed to be increased by approximately £114 to meet her liability in German currency. Mrs. Parker is claiming that the Post Office should pay her this additional £114.
The hon. Member for Richmond, as he has stated tonight, has had replies from my right hon. Friend and his predecessor to letters about this matter. He has also raised it in Questions and I can assure him, as he already knows, that this has had the most thorough examination. Nevertheless, I have to tell him that our answer is still the same: that we cannot pay Mrs. Parker the money which she is claiming.
Let me explain why this is so. The Post Office has no legal or statutory liability for the loss of an unregistered letter nor for any damage or delay to it. Nor, and this is the crux of the matter, have we any liability for any loss consequential to these events, that is, a loss not of the contents of the letter itself, but arising from its going astray or being delayed. This principle is of fundamental importance and applies not just to unregistered letters but also to registered letters.
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I should like the House to appreciate why we could not possibly accept any liability for consequential loss. The postal service can never be fully automated or mechanised. It is one which depends in the ultimate on the postman in the street delivering letters. Like all human beings he is liable to make an occasional mistake. The postman on delivery is working very much on his own. He has no supervisor to watch what he is doing and although misdelivery of clearly addressed letters is inexcusable it is understandable, particularly when considered against the bulk of the mail we handle, that lapses such as this do occur. More often than not misdelivery is rectified within an hour or so by the recipient delivering the letter himself either to the proper address or by dropping it in a post box for further treatment by the Post Office.
In this case it was doubly unfortunate that the occupiers of No. 7 Taylor Avenue were away for a period and that the contents of the letter turned out to be of such monetary importance as they were. Although inquiry was made immediately the complaint came to our notice and it is impossible to say precisely how the misdelivery occurred. In some cases letters have been known to stick to others; in other cases they have been caught in the flap of envelopes It may be that in this case the postman concerned—he was comparatively inexperienced—simply mistook the number. Whatever the cause, it was a failure which is greatly to be regretted.
We have always maintained that the delay of letters in the post, whether through mis-sorting, mis-sending or wrong delivery, or through failure in train connections, is a normal risk of transit.
Mr. A. Royle: I quite accept, and I am sure that every person who uses the postal service in this country accepts, that a normal risk of transit must be the risk of misdelivery, but would the hon. Gentleman say that devaluation was also part of that normal risk?
Mr. Slater: Although we take all possible care to see that letters are correctly handled in our sorting offices, there is always the risk of error, particularly when in peak periods our staff are

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working against time. We are responsible for a postal administration handling 35 million to 40 million letters each working day. One can be faced with the late running of air services, trains or our own motor vehicles due to bad weather conditions or mechanical defect. All may contribute towards delay. To admit that delay is a fault for the consequences of which, however costly, the Post Office should accept responsibility, would require us to accept an impossible liability.
I have answered Adjournment debates in this House regarding business people who have claimed that because of lack of proper service from the Post Office they have been unable to achieve contracts amounting ultimately to many thousands of pounds. Individuals could miss important appointments and winning pools coupons and bets could fail to arrive in time. Therefore, our liabilities would be very heavy. We would have to have increased funds to meet the resulting increased charges. Apart from genuine cases such as that of Mrs. Parker, acceptance of the principle of payment of consequential loss would, in our experience, lead to many fraudulent claims.
Both my right hon. Friend and myself when dealing with the previous correspondence and Questions about this matter—and the officials concerned in the Post Office—have regarded this claim very sympathetically indeed, and we have done all we can to see whether any form of payment, either ex gratia, on the basis of the application from the hon. Gentleman, or otherwise, could be made to Mrs. Parker. We have great sympathy for her, but to make a payment of this kind would not simply be most unfair to people whose claims in the past we have refused, but it would also, as I have pointed out, open the door to an unlimited compensation liability which the Post Office could not possibly accept.
I appreciate the great interest that the hon. Gentleman has shown on behalf of his constituent. I appreciate that the reaction of his constituent to my reply on behalf of the Post Office will not be very favourably disposed to myself as the one responsible for having to make it. I would have failed in my duty if I had not stated the reasons why we have not been able to accede to the request so reasonably made by the hon. Gentleman.
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Neither my right hon. Friend nor I get any pleasure from having to turn down this type of application. I hope that the hon. Gentleman will accept that every consideration has been given to his application on behalf of his constituent, although it cannot be successful, for the reasons that I have given.
Mr. A. Royle:I feel I cannot possibly accept that—
Mr. Speaker: The hon. Gentleman cannot speak again.
Mr. Royle: Before the hon. Gentleman sits down, I really cannot accept that full consideration and sympathy, which is all that has been given to this case, is enough. In his reply, the hon. Gentleman never mentioned devaluation. He did not answer the question that I asked him. How many other cases involving devaluation has he received which have entailed a claim for compensation as a result of misdelivery by the Post Office? The Assistant Postmaster-General has treated my constituent most unfairly, and she will rightly feel extremely bitter, as I do, at the cavalier reply that I have received.
Mr. Slater: I had already sat down. The hon. Gentleman talks about a cavalier reply, but I have endeavoured to be most courteous to the hon. Gentleman because of the interest that he has shown in the case. He talks about devaluation. I endeavoured in my reply to tell him of the number of cases that I have replied to in Adjournment debates on a similar basis—
Mr. A. Royle: Devaluation?
Mr. Slater: On devaluation, loss of export orders because mail has not been delivered on time and so on. I have endeavoured to give answers and to put the case as clearly as possible. The hon. Gentleman may feel disappointed in my reply, but anyone who accepts responsibility within a Department cannot seek to give preferential treatment to one specific case and rule out other cases as if they had never happened. I am very sorry that I am unable to accede to the hon. Gentleman's request, and I am surprised that he should have said that I have given a cavalier reply to his application.
Question put and agreed to.
Adjourned accordingly at five minutes past Twelve o'clock.