DEBATE ON THE ADDRESS

HC Deb 30 October 1973 vol 863 cc8-152

[FIRST DAY]

Mr. George Cunningham (Islington, South-West)

On a point of order, Mr. Speaker——

Mr. Speaker

Order. It will be more appropriate if we take the point of order after the motion for an Address has been moved and seconded.

2.40 p.m.

Mr. Wilfred Proudfoot (Brighouse and Spenborough)

I beg to move, That an humble Address be presented to Her Majesty, as follows: Most Gracious Sovereign, We, Your Majesty's most dutiful and loyal subjects, the Commons of the United Kingdom of Great Britain and Northern Ireland, in Parliament assembled, beg leave to offer our humble thanks to Your Majesty for the Gracious Speech which Your Majesty has addressed to both Houses of Parliament. This is the first Gracious Speech since this country entered the European Economic Community. I am sure the very fact of the Gracious Speech today has brought a great deal of comfort to people outside the House who were led to believe that we should not have a constitutional Monarch if we went into Europe.

The last three weeks have, I believe, seen a quickening of the evolution of Europe, brought about by the activities in the Middle East. It has become clear to the British people that our interests are not necessarily tied to either of the super-Powers, and that out of Europe will come a European interest. They are beginning to realise that Europe's concern is not just about the price of butter but about the price of peace as well.

It is always deemed a great honour—as I deem it a great honour to my constituency—to be chosen to propose this Address. Sammy Davis Junior once said of himself that he had been segregated twice, once as a Jew and once as a Negro. My constituents feel a little like that now, because my constituency has been split in two by local government reform, into Kirklees and Calderdale, two pleasant-sounding names, and bisected by the M62 motorway, which, frankly, I prefer to call the central British motorway. It makes geographical sense. The Midlands are, after all, the middle of England; therefore, central British motorway is geographically correct.

I believe that the name has psychological advantages, too, in terms of regional policy, because it will bring the North-East, the North-West and Yorkshire at least mentally 100 miles nearer to London, and perhaps the North of England will begin north of the M62 rather than north of Potters Bar. The motorway is the biggest thing that has happened in my constituency since the railways came—and went—and before that, the canals. They brought prosperity to the area. They were dug in those days by pick and shovel, but the way in which mechanical aids dug the motorway, with a lack of human drudgery, shows how far our country has moved. To ride the motorway now is to go through green fields which before were sooty and grazed by black sheep. The massive improvement in the environment can be seen by taking a trip on this motorway. It has taken the traffic out of town, too.

I am delighted that the Gracious Speech has within it proposals for legislation on noise and traffic in towns. In Yorkshire we have a saying, "Where there's muck, there's money". In parliamentary jargon, I suppose one could say, "Where there's environmental pollution, there are financial surpluses". But where there is muck, there are certainly grants, and my constituency has taken advantage of those grants to clean up some of its old buildings. I welcome the proposals in the Gracious Speech to take further control of the environment, and I am sure that all our young people, who are keen to see the environment improved, wholly support me in that.

My constituency is encircled by a ring of cities—Leeds, Bradford, Halifax, Huddersfield, and Dewsbury. The list sounds like a roll of national building societies and gives a clue to the character of the people in that area. They have been great entrepreneurs and savers, and still are, and I believe that the motorway will bring great changes to the area in that it can become residential. Young people will elect to live in the middle of this ring of cities, where they can change jobs without changing homes. I believe that to be a great advantage in these days of technological change which can bring redundancies.

I note also from the Gracious Speech that we are to have a new licensing system for buses. In many parts of the country—certainly in my constituency—this is long overdue and meets an urgent need. My constituency has many large buses travelling around empty, and I want to see a licensing system for maxi-taxis or mini-buses, or, as they are called in some parts of the world, "jitneys". I believe that these can be of great help to the elderly.

A matter dear to the heart of my right hon. Friend the Prime Minister is the reform of company law. In 1964, there was a companies measure on the stocks at the Board of Trade, when my right hon. Friend was President of the Board of Trade. I believe that maximum disclosure is necessary for the health of the economy and that it will help the companies themselves and be of no disadvantage to them.

I am glad that the Gracious Speech expresses throughout the will and desire to expand. I believe that our country has a great chance in the coming months and that we can shake off the lethargy of the last 25 years.

I shall blow my trumpet once more for my constituency. This is only appropriate because my constituency is very proud of the Brighouse and Rastrick Brass Band, which has been world champion twice and this year is national champion. It gives a great deal of pleasure to the people in my constituency, and it is completely self-supporting.

Taken together, the proposals in the Gracious Speech will give us a useful and workmanlike Session of Parliament. Benefit will come not only to my constituency but to the whole nation.

2.47 p.m.

Dr. Gerard Vaughan (Reading)

It gives me great pleasure to second the motion. In doing so, I am conscious of the honour which the House does to me and my constituency today.

I am conscious also of how difficult it will be to follow such a witty and eloquent speaker as my good friend the hon. Member for Brighouse and Spenborough (Mr. Proudfoot). His style is not my style, but I am comforted by having discovered, as many other hon. Members before me have discovered, how much genuine kindness and understanding there is in the House on an occasion such as this.

It is traditional that I should speak of my constituency, but how? How do I divert the thoughts of hon. Members from the splendours of Spenborough to the robust, rough realities of Reading? It is no easy task to go from the sublime to the industrial, because Reading is not the kind of place, Mr. Speaker, to which you and I would go for a holiday. It is a vigorous working town with a great tradition and history.

But it is not of yesterday but of today that I wish to speak. Things are happening in Reading, as they are in many other parts of the country, which are highly relevant to the Gracious Speech.

Our brewery is closing down; our biscuit factory is half pulled down. Acres and acres of the centre of Reading are turing yellow with National Car Park signs. But this is not the jaundice of ill health: this is the glow of prosperity—more beer—not less; more biscuits—not fewer. The factories in Reading are being modernised, so that they need less space, and out of these golden acres is rising a new generation of buildings—for the Metal Box Company, for Norcross, for a whole range of companies, with connections stretching out into Europe. Reading thrives today.

This is the first Gracious Speech since we entered Europe. I looked carefully for measures further to promote and expand the economy. They are all there, though in the shadow of the Middle East and Northern Ireland. But I also looked for something else that is very close to my heart, and I hope the House will permit me a personal line. There is another kind of demand today, more subtle but no less real. The Englishman's home is no longer his castle. Great numbers of men and women feel individually threatened by the stresses and speed of change today. They are seeking a new sense of confidence and purpose in public life, and in us. They are seeking new safeguards for their private lives.

Sometimes when I survey the great welter of legislation that passess through this great House I think that we do not, as often as we might, stop and say "Yes, this will indeed help the country, but how will it be viewed by individual men and women? How will it affect individual families?" The two are not necessarily the same. I think we ignore that kind of approach at our peril. I therefore particularly welcome in the Gracious Speech the bold and unequivocal statement: My Government's objective throughout will be to promote the interests of the individual…". We provide clean food and water but we do not always provide clean air, unpolluted surroundings and freedom from noise. I am delighted, therefore, to see that the major emphasis in the Gracious Speech is on environmental protection.

But the mind can also be polluted, and surely we are entitled to walk through the streets without being offended. Surely to be over-tolerant to the few in this subject is to be most intolerant to the many. I therefore welcome the proposal to legislate on pornography and law and order.

We all, of course, also welcome the proposed legislation against sex discrimination. In Reading we have long had an appreciation of the importance of women. Our coat of arms contains five heads—all men. In 1566 we hurriedly changed them to five women. This was just before Queen Elizabeth I came to visit the town, and just before she gave us a most profitable charter.

There is much in the Gracious Speech for individual men and women, with its promised measures to promote safety at work, at sport and in the streets and to help those in need, but also to allow self-help, which is essential for self-respect. In Lincoln's famous words, we must not attempt to do for men what they could and should do for themselves.

Lastly, perhaps what is happening in America—let none of us take much joy in that—will lead the British electorate to have a still greater appreciation of our system. I see in the Gracious Speech much work to be done, but also much that will satisfy the highest and most compassionate ideals of this great House.

Mr. Speaker

I would now normally call the Leader of the Opposition, but I believe the hon. Member for Islington, South-West (Mr. George Cunningham) has a point of order.

Mr. George Cunningham

On a point of order. At the beginning of a parliamentary Session there is a great deal of fatuous ritual, Mr. Speaker. It is not my intention to bring to your attention a point of order in respect of it all, but I suggest that every year there is one part of that nonsensical ritual which is increasingly unacceptable to everyone in the House and, I would have thought, most of all to you, Sir. For you to be obliged by our practices to read out three pages of text which we all have in our possession and, if we have not, can easily obtain in a fraction of the time it takes you to read it, is simply ridiculous. Will you invite the Select Committee on Procedure to consider the matter and decide whether it makes sense that you be asked to read out a text which we are all holding in our hands?

Mrs. Jill Knight (Birmingham, Edgbaston)

Further to that point of order, Mr. Speaker. The House had not yet heard the Gracious Speech until you spoke it, and other hon. Members welcome your own reading of the speech.

Mr. James Allason (Hemel Hempstead)

Further to that point of order, Mr. Speaker. Is it not for the convenience of the House that the Gracious Speech should be recorded in HANSARD by your reading it?

Mr. Speaker

I am always grateful for any suggestion which will relieve the burden upon me, but it is for the whole House to consider whether this is an appropriate matter for the Select Committee on Procedure. No doubt hon. Members' comments have been noted, and they will perhaps be borne in mind and considered.

2.57 p.m.

Mr. Harold Wilson (Huyton)

In accordance with the ritual of the House, and on this occasion with great sincerity, my first and agreeable task is to congratulate the mover and seconder of the Humble Address on their speeches. Both were fully up to the standard that the House always expects on these occasions and both took the traditional opportunity to pay an appropriate tribute to their constituencies.

The House will have noticed that since 1970 an interesting pattern has emerged in relation to the mover and seconder of the Address. I have drawn attention to it on previous occasions. The mover in 1970, the hon. Member for Blackpool, South (Mr. Blaker), later joined the administration. Two years ago I felt that the hon. Member for St. Ives (Mr. Nott) was obviously on his way to inclusion in the Government. Last year, I made an even more confident forecast, and in the fullness of time, as the Prime Minister always proceeds with great deliberation in these matters, the hon. Member for Colchester (Mr. Buck) joined the Government.

On both occasions I felt, as I feel again to-day, that promotion of this kind could only improve the average level of the Front Bench. So on these previous cases, marginally, it has proved. But the House will have noticed the pattern. It was the mover in 1970 who became Under-Secretary for the Army; in 1971 the mover penetrated into the holy of holies and became Minister of State at the Treasury, and he has spent his time ever since defending VAT; and in 1972 the mover became Under-Secretary to the Navy.

It seems to be—I do not know whether by design—the Prime Minister's rule that the mover moves into the Government and the seconder remains outside. One can envisage a whole string of seconders—three of them now: four and that will be the lot—forming a glee club on some future occasion and entertaining the House to the lament, "Why am I always a bridesmaid and never the blushing bride?"

I do not know how quickly the Prime Minister intends to move on this occasion in favour of the hon. Member for Brighouse and Spenborough (Mr. Proudfoot). I hope very quickly indeed, because both speakers today—and I should like to refer to the thoughtful contribution of the hon. Member for Reading (Dr. Vaughan)—are representatives of highly marginal seats—marginal even by normal standards—so they will have to be given the chance of gathering their ministerial rosebuds while they may.

The constituency of the hon. Member for Brighouse and Spenborough is well known to me, even better known since it was represented for so long by a very close friend of mine and of many of us, the late John Edwards. It has suffered. The hon. Member referred to the Brighouse and Rastrick Brass Band—and we congratulate it again and are glad and surprised to find that it is not a lame duck, even under this Government.

The constituency has suffered from the ill-informed comments of comedians, visiting journalists and others who devised the phrase "Cleckheckmondsedge" as betraying the last bastion of the dark satanic mills. But the hon. Gentleman has every reason to know, as I have, the beautiful scenery in the uplands and moors in and surrounding his constituency.

I have something in common with the hon. Member for Reading. The expansion of his biscuit factory, to which he referred, has been sited in Wilson Road, Huyton. I am sure that he will be glad to hear that. I am sorry we have not got his brewery as well. My advice to his constituents in their enforced lack of liquidity is to import Federation.

In praising the Gracious Speech both hon. Gentlemen showed remarkable ability, not so much parliamentary as constructional. Never have I seen such good bricks made with so little straw. One has to be a very senior Member of the House to remember a Queen's Speech with so much verbiage to conceal so little content of policy. We shall have some worthy legislation, some of which we shall be able to support with limited enthusiasm.

We look forward to the measure on the environment. I am sure that it will be unexceptionable and limited.

I am a little concerned about the promise that Ministers will continue to give high priority to housing policies. If this is a continuing policy, one has to conclude that it is no idle threat. The high priority they consider they have given has reduced the building of houses this year to an annual rate just bordering on 300,000 houses, on which the right hon. Gentleman himself no doubt campaigned in 1951 and which Mr. Harold Macmillan achieved two years later. The right hon. Gentleman's performance is falling below that of 1953.

We shall be prepared to give full support to legislation to support road safety and the control of traffic and "to permit greater flexibility"—whatever that may mean—in the provision of rural road transport.

We shall study local government finance proposals with great interest, not to mention the reform of crofting and the reform of land tenure in Scotland. The Prime Minister will be able to tell us, when he catches your eye, Mr. Speaker, whether it goes as far as to release from landlords' sporting rights vast areas required for crofters and for public amenities.

We welcome the promise of a Bill to remove unfair discrimination on grounds of sex in employment and training. When an hon. Gentleman opposite talked out a Labour Private Member's Bill in the last Session, we provided Opposition time to ensure that the Bill made progress. But if the proposed Bill represents no clearer thinking than the Government's White Paper it will be a total disappointment. Therefore, in a spirit of total cooperation and helpfulness, I offer the Prime Minister, and will send him, the document produced by the National Executive Committee of the Labour Party on this subject which was warmly endorsed by our recent conference.

I will reserve my comments for a few minutes on what seems to be the major measure of the year, the Companies Bill, reforming the Companies Act 1948.

We welcome the reference to new legislation on safety and health. The Government still have not fully caught up with the measure we introduced in the 1969–70 Session. They legislated part of it, but rushed to drop proposals for competent safety committees within industry, including representatives of the workers as well as of management.

We welcome the proposed legislation on non-discrimination in Northern Ireland. I have particular reason to endorse this because it was an integral part of the Downing Street Declaration of August 1969. Perhaps I should add that, in the ordering of our debates this week, the Opposition take the view—I believe that the Secretary of State agrees—that the House should not discuss Northern Ireland during the debate on the Address on any formal motion, it being understood that a debate on Northern Ireland will occur in the reasonably near future.

This new Session begins against a sombre and still potentially dangerous world background. In the Gracious Speech, the Government are committed to continue to work for a just and lasting peace in the Middle East". In the debate 12 days ago, I expressed our anxieties not only about the dangers of the Middle East situation but of what I considered to be the misconceived policies of the Government. We can now all see that the Government have succeeded by their exertions and led Europe by their example to non-intervening themselves and Europe into a position of virtual impotence in the search for peace.

I recall the Foreign Secretary, when he was Prime Minister, during the nuclear debates in 1964, claiming time after time that a Labour Government would never be at the top table. During the Middle East crisis of 1967, Britain was at the top table—in Washington, Paris, Moscow and Ottawa. The Foreign Secretary's one achievement in the past fortnight, during the latest world crisis, was a ticket to the VIP lounge at Heathrow Airport, there to be told by the United States Secretary of State of the settlement then being imposed on the duelling antagonists by their respective seconds.

Her Majesty's Government have even been barred from playing any part so far in the peacekeeping forces. In all parts of the House, we hope that this will be changed and that we shall play a part.

The Secretary of State for Foreign and Commonwealth Affairs (Sir Alec Douglas-Home)

I should like to correct the right hon. Gentleman on one point. I said in 1964 that a Socialist Government would not be at the top table unless they retained the nuclear deterrent, which they did.

Mr. Harold Wilson

We were at the top table throughout all the years, not because we had a non-independent deterrent but because we had something to say, which the right hon. Gentleman on this occasion entirely failed to say.

I expressed the hope that our troops will be allowed to play a peacekeeping rôle, though I concede at once that the Royal Air Force has been doing a useful job of ferrying the troops of other nations. The present situation is unlike that of 1967, when a British Minister was responsible for the definitive Resolution 242 at the United Nations, where Britain, as a friend of Israel, and France, as a supporter of Arab countries, joined the two super-Powers in the quadripartite talks and when Britain was playing not merely a fringe rôle but a leading part, before and during the fighting, and in the search for a settlement.

In those days, there were talks at top ministerial level—Mr. George Thomson in Paris and Washington, on the problems of the Straits of Tiran, and the Foreign Secretary in Moscow and leading our team at the United Nations. There were meetings at Head of Government level in Ottawa and Washington—again on the vital British interest of freedom of the seas—and with General de Gaulle in Paris. What happened last month was unlike even 1956, though right hon. Gentlemen opposite were combatants then—I think on Israel's side.

The Government's only achievement has been a low-profile, allegedly non-interventionist negative unity within the EEC, which, as I have repeatedly warned them, could mean unity only on French terms, which means unity on a pro-Arab posture. That has been the position of Britain and hence of Europe.

Then came the humiliation of the American alert, which this Government did not seem important enough to be consulted about. Let us be clear. The American decision not to consult was an outrage, and on an issue potentially lethal for world peace it was a grave dereliction of the duty owed by America to her allies. The ignominious conduct in relation to the war of Britain and other European NATO Powers was no justification for such a contemptuous default. The same was true in 1956, when the British Government showed a similar disregard for their allies and partners.

Now, the Government have to reconstruct a situation in which the voice of Britain will begin to count once more. Perhaps the Prime Minister will begin by telling us the present state of the arms embargo. Having behaved like the administrator of a blood bank who cut off supplies at the moment when the patient was bleeding to death, can he tell us when normal service is to be resumed?

I wonder whether the right hon. Gentleman will answer another question. In May and early June 1967 our Government took the initiative in a question which has always been of vital British interest, namely, the freedom of the seas. The closure of the Gulf of Aqaba, at that time in breach of a century of international commitments about free passage through international waterways, caused Britain to take the lead in trying to assemble a consortium of the main maritime powers to open the straits. There were talks at top Admiralty level in Washington and Heads of Government talks in the White House.

Although little has been said in public about this, there have been reports in recent days of Yemeni closure or an attempt by Yemen to close the Straits of Bab el Mandeb and the use of naval power. I understand this was already the case before the cease-fire. Recent Press reports suggest that the interference has persisted. Would the right hon. Gentleman say whether there has been interference with the freedom of passage there? If so, is interference with the freedom of passage continuing? Have Israeli ships the right to go through the straits without interference? If there has been interference, what action did Her Majesty's Government take, separately or in concert with other Powers, when they first received reports of the use of violence blatantly in breach of solemn international conventions?

The war in the Middle East will undoubtedly exact its toll in terms of the economic life of this country. It is less than a fortnight since the House debated stage 3 and the accelerating rate of inflation in the country. In that short interval we have had further facts, further fears and further blows. During the debate I referred to the retail price index, and quoted official figures to show how much the pound has been clipped by the Government. I pointed out then that we had no later figures than August, though I warned what we had to expect for September in the light of the Financial Times grocery prices index. We now have the retail price index figures for September. They show that the pound, which was worth 20 real shillings in 1970, has been further clipped to 77p. It is worth reminding the House that the retail price index does not allow for increased mortgage rates.

The right hon. Gentleman must know that prices are rising faster than ever, despite seasonal assistance usual at this time of year. The Financial Times grocery index for October shows an increase of 2.8 per cent., by far the biggest increase for this time of year since the series began eight years ago. We were warned, even on the day after the stage 3 debate, by the Minister of Agriculture, Fisheries and Food about further food price increases. The housewife must also look forward on 1st January to the imposition, under EEC rules, of import duties from all non-EEC countries—in other words, from, in most cases, our main suppliers—on a wide range of tinned goods such as salmon, sardines, tuna, pilchards and tomatoes. I do not think the Minister is present but I should like to pay him a tribute for one negotiating triumph: the import duty will not apply to corned beef until the first Monday in April. Bully for him!

Within the next few days steel prices are due to rise again, we read by about 10 per cent., but there is a suggestion this morning that because of the restructuring of the price schedule it may be 14 per cent. Higher steel prices will, and must, force their way right through productive industry and can further affect canned foods. These increases are due, as the Labour Party warned, to the terms of entry to the Common Market, to the pressure which high-cost European steel producers are exerting on the British Steel Corporation to come into line with threats of legal proceedings before the European Court.

While I am referring to prices, I am sure that the Prime Minister will not object if I draw attention to a palpable mis-statement of fact in his party political, dial-an-alibi, television programme last week. He was asked, as part of a wider question, You told us among other things that you would cut prices, I am sure you will not deny that". The Prime Minister replied: …what I said at the election was that we would slow down the increases in prices, we never promised you that we were going to force prices down, nobody thought that that was possible. The Prime Minister is nodding his head, but that answer, given to millions of viewers, was untrue.

On page 5 of the famous statement "The Conservative approach to rising prices" on 16th June 1970—the "at-a-stroke" statement—the Prime Minister said: But there is a very real alternative which ought to be pursued immediately. That alternative is to break into the price/wage spiral by acting directly to reduce prices. Last week the Prime Minister denied he ever said that. He was misleading the public—millions of them. I suggest that he should now ask for broadcasting time—two minutes would do—at a peak hour to explain how he misled the viewing public last week and to apologise. I assure him that we would not ask for the right of reply.

There is, on top of the food and steel price increases I have mentioned, the serious blow of increased oil prices. This will affect the cost of travel, whether petrol is rationed or not, of public road passenger transport, of heavy goods vehicles carrying food and other provisions around the country, of rail and sea transport, electric power generation and central heating in homes, schools, offices and other buildings.

This is not a blow for the Government; it is a blow for the country, for all of us. Ministers have confirmed that it could mean a direct levy on our balance of payments of some £400 million—I do not believe that that is an exaggeration—at a time when the trade figures in the most recent quarter, the third quarter of this year, represent an annual adverse current balance, visible and invisible, of over £1,300 million, the worst in our trading history—3½ times as bad as in 1964. The House has a right to be assured that the Government are taking this threat to the economy with sufficient seriousness.

One immediate action which the Prime Minister should take, without waiting for his long deferred reshuffle, is to appoint a Minister responsible for fuel and power questions in the Cabinet, with absolute authority, subject only to the Prime Minister's authority and that of the Cabinet. That had been the position since the war until the present Government came to office. Although I merged the Ministry of Fuel and Power with the Ministry of Technology, a Cabinet Minister—my right hon. Friend the Member for Manchester, Cheetham (Mr. Harold Lever)—had full responsibility for those questions.

I suggest that that Minister, in the Cabinet, should also have full power to deal with North Sea oil and gas and the development of gas and oil in the Celtic seas. It is not good enough to leave this matter to a Minister of State in another place.

No one expects—and the Minister concerned was suitably realistic yesterday—that the yield from the North Sea can begin to replace even part of oil we lose from the Middle East until next year. But will the Prime Minister answer this question: when the oil begins to flow, will the oil that we bring to these shores be ours? I read this week that the Getty oil interests have entered into a commitment to supply North Sea oil from the Piper Field to Japan's Mitsubishi.

Our proposals for the full and effective nationalisation of the gas and oil around our shores, and landed here, mean that all operations will be subject to British control over distribution and export. But this is not all. European claims are being asserted this week that the harvest of the North Sea—and, in due course, presumably the Celtic seas—must be shared with other EEC members. Does the Prime Minister admit such an obligation? One thing noticed in the terms of the complacent statement of the Secretary of State for Trade and Industry—presumably due to pre-by-election complacency—was his assertion that exports of oil and oil products would be controlled, but not controlled as between EEC countries. Is this a temporary provision, or has the pass been sold already?

I know it is hard for the Prime Minister to appreciate this, but he should tell the French President when they meet next month, and Common Market leaders, too, not only that we will not be pressurised into entering the European monetary snake; he should tell them that in matters of oil, now and in the future, what we have we hold. He might also tell the President that when the House of Commons passed a resolution on juggernauts—that we were against bigger and heavier lorries—we meant it, we mean it, and we intend to secure compliance by the Government, despite the rumours last week that they were ratting on it. I remind him that we meant it last week on Commonwealth sugar, too.

I wish to mention a further point on oil, based on our experience in 1967. As the right hon. Gentleman knows, we had to face a total Arab oil embargo. We were also faced with a prolonged interruption of supplies, because of the number of tankers on the wrong side of the Suez Canal when it was closed. We were extremely fortunate to avoid rationing, and almost totally to avoid interference with industrial production. But for six months we had a very anxious time, and our biggest anxiety was naphtha for industrial purposes. The right hon. Gentleman may not want to comment on this, and I shall understand if he does not, but I put this to him to consider: has he adequately built up stocks of naphtha? Is he taking special steps to safeguard naphtha supplies, and is he confident that they are adequate?

This brings me to the question of coal. Urgent decisions are needed, some immediately revelant, such as the switch from oil-firing to coal in dual-fired power stations. Longer term, the development of new deep-seam pits in Yorkshire and elsewhere is bound to take years, but the necessary measures should be pressed right ahead from this area.

There is another long-term suggestion I wish to put to the right hon. Gentleman. I hope he will consider it, without necessarily giving an off-the-cuff reaction. Is there not a case now for building in coal-producing areas, in development area, a number of State-owned oil-from-coal plants for deriving oil from coal, whether by the most modern means of hydrogenation, the Fischer-Tropsch process, or whatever is the most suitable? This would be a precaution against a future exercise of what the Foreign Secretary has referred to as blackmail.

There is, of course, a considerable risk that in normal times they might prove uneconomic. My understanding is that, at present pithead coal prices, these processes are competitive when oil prices are 10 dollars a barrel or above. Oil prices from some areas even now are reported to be pressing hard on that figure.

There is therefore a standing risk for years ahead, with a possibility of a continuing subsidy when oil prices are lower. But I believe it is a matter for urgent consideration whether this is a necessary insurance policy for the country, the economics of this proposal being the same as the maintenance of a defence capacity which for long years has to be subsidised against a possible future need.

If our industrial production and, indeed, the sovereignty of our foreign policy is to be threatened from time to time by blackmail of the kind to which the Foreign Secretary referred, then it might be our duty, in order to preserve our independence and sovereignty, to go ahead with programmes of this kind. But immediately we need to get all the coal we can.

The right hon. Gentleman must know, after his meeting with the miners, about the acute manpower shortage in many districts, as miners who have been held in the vice of stage 2—and now apparently stage 3—leave underground employment to work in private industry where Government-prescribed wage levels are being increasingly disregarded and defaulted on.

Recognising, as he must, that Government policies in this area are becoming more and more of a dead letter—as they are on prices and on anything to do with housing—he must regard the maintenance of essential production in the face of overseas blackmail—I am referring to coal here—in the face of oil blackmail, as of the highest priority. The consequences he faces, the consequences the country faces, are of great gravity, threatening our hopes of even maintaining industrial production and investment, let alone any hope of continued industrial expansion—which, in any case, after last year's boom, has very much slackened off. Production cannot be maintained without coal, as he learned the hard way in February 1972; and coal cannot be produced with a growing shortage of mine workers.

In a parallel connection—and this is related to the Pay Code—the Gracious Speech seems to reflect a total lack of understanding and concern on the part of the Government about the growing problems of London and other urban areas. We pressed this upon the Prime Minister in the debate on stage 3.

The right hon. Gentleman showed no sense of urgency or understanding, and in the dismal half-hour speech made by the Minister for Trade and Consumer Affairs, at the end of the debate, which was even worse by any reckoning than the epic performance of the present Chancellor of the Duchy of Lancaster three years ago—I use the language of superlatives in the matter—there was no reference to it.

London today—and it is true of other cities and urban areas—is seizing up. Many hon. Members will confirm the position of other major cities and urban areas. The problem in transport is partly pay, partly housing. I take housing first, because there is a special problem here, even if there were no pay problem. Bus and tube drivers plainly need to live near their work. If they are driving the first bus or tube, there is no one to take them to their work. They are finding it increasingly difficult to get housing near work. Many cannot find a home in any area. Working-class houses have been demolished for the erection of more expensive buildings, homes or offices. In many cases, others have been taken over by the employment of Rachmanite methods, improved with public money and then sold at high prices.

Let me give an example. London Transport has been trying to provide easy-term mortgages for its drivers and other essential workers. Is it the case, as we have been told, that under stage 3 this cannot be done because it would constitute an offence against the Pay Code? Apart from the problem of getting a house near the job, there is a shortage of other essential workers. All essential workers in London are affected by the cost of housing.

We all know how prodigiously tenders for new council houses in London have risen since June 1970. If there is a question of buying, the average price of a new house bought under mortgage in the second quarter of this year in London and the South-East was £13,700 against £6,540 in the fourth quarter of 1970. Land prices alone have risen from £1,861 for a site in 1970 to £5,259 this year.

London Transport is short of 4,200 drivers and conductors. Despite special recruitment efforts during the past year, the figure has actually increased during the period by 1,250—that is, by just over one-third. On the Underground, there are signal staff vacancies of up to a third in some key grades. Over 400 buses are off the roads due to shortages of engineering and maintenance staff. Many other buses are in operation when they ought to be in for overhaul.

Sir Richard Way, Chairman of London Transport, told the Minister: Frankly we find it an embarrassment to advertise for permanent staff…with a current base rate for lengthmen of £22.70 week. Again, commenting on the stage 3 proposals in a letter to London MPs, Sir Richard said: The only conclusion which it is possible to draw is that the Government, for reasons of wider considerations, have decided as a matter of policy to accept a serious further deterioration in public services in London and the main purpose of this letter is to tell you, without mincing words, that this is what will happen to London's public transport in 1974. Sir Richard concluded: Given the labour market in London I can see no prospect of achieving a substantial improvement in London Transport's labour situation within the terms of the present consultative document. Last week, the Secretary of State for Trade and Industry in a statement in the House on oil, said: I would ask that motorists should endeavour to cut down on petrol consumption and to use public transport to a greater extent where that is available".—[OFFICIAL REPORT, 24th October 1973; Vol. 861, c. 125.] In other words, "Let them eat cake".

Again, the postal services are 4,167 short of the total London establishment of 27,000. In the North London area, the manpower deficiency is 10.6 per cent.; it is 11.2 per cent. in Battersea and 11.9 in South-West London. Still higher figures exist. In West London it is 20.5 per cent., and it is 24.1 per cent. in Southall.

I turn to the police. There was a campaign about law and order in 1970 and for months before, yet there has been a net loss of police manpower since 1st January of 400.

I turn next to the ambulance service. There are reports in a West London newspaper of hospital after hospital …closing their doors to ambulance cases…leaving one secondary hospital almost continually taking the brunt of cases from nine catchment areas. There is a whole list of hospitals closed to ambulance cases, with fears of others closing soon.

As the House knows there is also a disastrous shortage of radiologists, physiotherapists and other hospital specialists. Public health has a short-fall of 179 public health inspectors, with a consequent danger of deterioration of hygiene standards. There is a shortage of valuers, who are necessary for major land acquisition for housing and other essential purposes, and the GLC is 25 per cent. down on its establishment. Nearly 20,000 pupils are on part-time education because London is 500 teachers short. It is pay and it is housing. London is seizing up not only for the citizens of today but for the citizens of tomorrow.

Perhaps the right hon. Gentleman will tell us whether he accepts the report in Sunday's newspapers that education authorities fear that for the next financial year they will get only half the extra money they need from the Government, about £150 million, to keep existing services up to scratch. Already, education building has been cut back by the Prime Minister's announcement, but before then the yardstick control was holding it back and in some authorities—Manchester is only one example—the area per scholar has had to be cut. My hon. Friends have told me of conditions very similar to those of London in other urban areas, except in cities and towns where unemployment is still high. The Government, with their quaint sense of priorities, forced Maplin and their Channel Tunnel plan through the House last week while refusing consent to Manchester's urgently-needed rapid transit underground "Pic-Vic" plan.

Some of us are to see the Leader of the House about the treatment of staff in this House. There is a shortage of staff in some of our ancillary activities, where rates of pay are 30 per cent. below what is comparable in London because other employers take no notice of the Government's Pay Code. This is turning the Mother of Parliaments into a sweat shop. I hope that the Prime Minister and other Ministers are as ashamed as we are, because here we have a special responsibility as employers.

I understand we are to have the stage 3 code today. I do not know whether we shall be having a White Paper or whether the code has merely been issued to the Press. One would assume that there would be a White Paper before the House today though I have not yet seen it. Presumably it is not very much amended even after our debate, though I gather that there may be one or two marginal concessions to the CBI. The proposals accept the principle of thresholds. As long as thresholds persist in Government policy, in fairness why should there not be a threshold for pensioners, so that, when the cost of living has risen 7 per cent. above the October level, there is a fixed addition to the pension for every point above that 7 per cent. instead of waiting for the annual review?

Because the Government have been shutting their eyes to the reality of the economy, the problems I have described will develop and intensify. The reason for this, as in everything else, is that we have a disastrous Prime Minister who cannot ever bear to admit that he is wrong. Uncaring, he thinks he can brush away any problem by quoting index numbers. As month succeeds month, he gets further away from the problems of ordinary families. In fact, he is not so much a Prime Minister as a computer, a not-very-accurate computer but programmed to reflect discredited Tory policies of the past and the demands of the interests that the Tory Party exists to serve.

The trade mark of the Prime Minister is to introduce bad laws, railroad them through the House, see them fail in their main purposes and carry them through regardless of the harm they are doing—like industrial relations after the tragic failure at the time of the rail strike—even when they poison industrial relations and frustrate the purposes, whether higher production or the control of inflation, which the right hon. Gentleman proclaims.

When the Prime Minister is called to account in the House, instead of changing the bad laws—because he cannot disembarrass himself of all those swinging pre-election speeches—he takes refuge in appeals to the majesty of the law. No man has done more than he has to bring the majesty of the law into disrepute.

Mr. Norman Tebbit (Epping)

Clay Cross.

Mr. Harold Wilson

I referred to bad laws, and that was one of them. I ask the right hon. Gentleman to reconcile the concept of the majesty of the law with sequestrators appointed by the law skulking around the back entrances of urban district offices in County Durham.

One of the tragic things about the Gracious Speech is that it not only fails to show any concern, still less than any policies, for dealing with the problems of ordinary families. It is almost bereft of any suggestion for dealing with the problems of industry. True, we are to have a Companies Bill but this, if it follows the line of the Green Paper, will produce merely a list of legalistic provisions to contain—that is I think the in-word—the scandals of a future Lonrho, a few provisions about insider-dealings and such things, in order to avoid the creation of a Securities and Exchange Commission which is urgently needed. The right hon. Gentleman having upbraided the unpleasant and unacceptable face of capitalism and having been turned down by the shareholders, all the Government are proposing are some ill-assorted grease paints to cover the more visible warts.

Until we see the Bill we shall not be able to see the ratio of loopholes to clauses. I suspect that ratio will be much greater than unity. But I must tell the right hon. Gentleman that he really does under-rate the City or the relevant sections of it. From the moment the Green Paper was published, to the passage of the Bill into law, every loophole, every flank it exposes will have been exploited or turned.

What is needed is not a beauty box of cosmetics but the fundamental restructuring of our industrial financial system, and, above all, a fundamental redistribution of power between those who serve the nation in industry with production for use, for investment, for export, and those on the other hand who can make far larger fortunes by pushing money about and creating bogus money claims out of paper money, which in many cases they do not possess.

We on this side of the House have put forward our proposals for the fundamental restructure of British industries. I have heard the comments of the noble Lord, the Secretary of State for Defence and Chairman of the Conservative and Unionist Party. I heard him on the radio. How he finds the time for defence—if he does—even at a time of peril for the world—is not clear, for the Chancellor of the Exchequer when he was Chairman said it was a full-time job.

Let me tell the Chairman of the Conservative Party and his hon. Friends, that on the proposals we have put forward for industrial change, the onus of proof is no longer on us it is on them to justify and defend what the country knows to be wrong. It is our proposals which should be in this Gracious Speech and,—if the Prime Minister does not chicken out of it—please God, will be in the next.

We shall take into public ownership all land required for building, development, redevelopment, slum clearance, schools, hospitals, playing fields, sports centres and other amenities at existing values. The Government have done nothing about land. We cannot even find a reference to their 30 per cent. hoarding tax. It is for the Government to defend their refusal to do so—[An HON. MEMBER: "Who will pay?"] I am asked who will pay for our proposals. But who is paying now? The Government's refusal is being paid for by young couples who cannot get houses, whom hon. Members tricked into voting for them at the last election by quoting what the Prime Minister said.

It is for the Government to defend their refusal to take land into public ownership, because the people know what private ownership of land, above all private speculation in land, has meant in the soaring cost of new houses, whether publicly or privately owned. That is to say nothing of the cost of other public services from education to health.

The people know—and it is for the Prime Minister to answer this—the obscenity of large fortunes being made in land and property speculation when young people could not get houses, or mortgages except at an inordinate cost and when lower-paid essential public services have had their wages screwed down by the Government to unacceptable levels.

As for public ownership of the minerals beneath the land of this country and around our shores: the onus is on the Government to defend private ownership.

The ports of the country: let the Government defend the present structures and some, at least, of the records of management. The Government's only contribution was to bankrupt the Mersey Docks and Harbour Board and filch the savings of many thousands of people least able to protect themselves, as I know from my constituency, as does every other Merseyside Member.

Shipbuilding and aircraft: it is for the Conservative Party to defend the massive State assistance with minimal State control. What the country will accept is that the reach of public responsibility and public money should no longer exceed the grasp of public control on the basis of public ownership.

Let the Government defend the record of certain firms in the pharmaceutical industry exposed by the Monopolies Commission. Let them say there is no case for selective public ownership in that industry or of constructional firms within the context of urban development. For the Conservatives the centre of a city in need of rebuilding is an invitation to plunder for the benefit of a few wealthy privateers. For us it is a chance of tearing down the legacy of Victorian capitalist complacency and of building cities worthy of our people.

Let the Government defend the pillaging of public assets by denationalisation over the last few years and tell the country who has made the profits out of it. Let them tell the people why they oppose our Industry Act including, for example, the power to stop the foreign firm taking over, perhaps for purely asset stripping or other reasons, an important British industry or firm—[AN HON. MEMBER: "Too long"]—of course it is too long for hon. Members opposite. It is coming back to them now.

It is in our policy and it is for the Government to defend their refusal to implement it in theirs. [Interruption.] Very well, they have tempted me. Perhaps they would care to consider a par- ticular case since they are so anxious to hear about it. A big company in this country concerned with shipping services is now under immediate threat of take over by a consortium consisting in the first place of Capitalfin International, which is an investment group of what the Economist calls "The Italian Establishment" including the Banca Nazionale del Lavoro, Montecatini, Edison, ENI etc., together with a mysterious Signor Vlasov, a White Russian recluse, now an Italian citizen, living in Monte Carlo.

The Government intend to fight the next election on the right of capitalism and the enigmatic Mr. Vlasov to take over a British firm simply because it can make an appealing offer to shareholders—regardless of any other interest such as the workers—while the Government are equally prepared to fight in the last ditch to prevent vital British industries passing into the hands of the British people.

It is not that they object to control. The only effective control they recognise lies in Brussels. Only yesterday I read that the European Commission is still demanding that major mergers and takeovers as well as national plans for controls over multi-national companies should be submitted to Brussels for prior approval. The Government delude themselves if they think that they can chill the spines of the mature British electorate with all their stuff about Marxists under the bed. What many of our workers fear, and not least middle management—perhaps most of all middle and top management—is a takeover not by the State; they are looking over their shoulders at the prospect of a sudden decision taken for financial purposes in the City of London or elsewhere aimed at a quick capital profit and as often as not totally unrelated to the needs and standards of industrial production. They know well the case of a well-managed firm which was forced to close a factory and develop it itself to avoid the whole of the undertaking being taken over. There are double standards by the Government, on the question of allowing anyone to take over British firms—except the British people.

It is a condemnation not so much of the Gracious Speech but of the total policies of the Government that they have not dealt with these questions. The Government have divided the nation. It is a case of devil take the hindmost and the weakest go on a means test. A few privileged, and not always qualified, people have grown even richer in the system of society that the Government have created. The Government cannot realise that if a few people make large profits out of the community, the rest of the community has to pay for them. If a Government allow, even encourage, such interests to milk the community in that way, they make still harder the acceptance of what is so important to them, their anti-inflationary policies. The Government's policies mean that those who produce the nation's wealth through their work, by hand or brain, have to pay this intolerable levy to a society which is more finance-dominated than at any time in our memory, and more acquisitive at the expense of the ordinary family.

That is the condemnation of the Government for which Ministers will have to render account to the public. That is the condemnation of the attitudes set out in the Gracious Speech, that the Government, even now, show themselves determined to continue with policies which have manifestly divided and weakened the nation.

3.47 p.m.

The Prime Minister (Mr. Edward Heath)

I join the Leader of the Opposition in offering congratulations to my hon. Friends the mover and seconder of the motion for the Address. When my hon. Friend the Member for Brighouse and Spenborough (Mr. Proudfoot) first entered the House he brought to it a freshness and breeziness of approach which the House has always appreciated. I well remember the contribution which he made to the debate on the Resale Prices Bill—if one dare mention it today—of 10 years ago.

My hon. Friend the Member for Reading (Dr. Vaughan) has been in the House a much shorter time, but has, as we have seen, brought his own characteristic manner and contribution to our debates, one of thoughtfulness, as the Leader of the Opposition said, but also wit and humour. We welcome the happy contrast between my two hon. Friends, because it has given an interesting combination of opening speeches. I join the Leader of the Opposition and the House in thanking them for, and congratulating them on, what they have done.

The Gracious Speech deals first with international affairs. It was of this that the Leader of the Opposition first spoke, and I wish to address myself to that now. Everyone in the House has shared the anxieties which the country has known about the events of the past month. We were distressed to see yet another act in the human tragedy in the Middle East, involving so much loss of life and misery and waste of resources and opportunities,—and this is all the result of failure over six years to secure a negotiated settlement of the problem. We have also been aware, like the whole House, of the danger that the conflict might be enlarged, perhaps fatally.

The Leader of the Opposition, in an extraordinary outburst this afternoon, condemned the policy followed by the Government, which, when it was debated last week, received the massive support of the House. If I may say so to the Leader of the Opposition, diplomacy can be carried on in ways other than by Ministers flying around the world from place to place, and it has been going on in that way during the past four weeks. There has been the most intensive diplomatic effort to bring about a cease-fire.

The right hon. Gentleman obviously takes the view, as he said in his speech in the foreign affairs debate, that the policy of an arms embargo was wrong, and now says that our position is bad because of it. I entirely fail to understand that. In which way would it now be better if, at the same time as we were calling for a cease-fire and using all our influence in the United Nations and elsewhere, we had gone on supplying arms to both sides? How would our position today, as a country, be better in that respect? [Interruption.] Of course the United States supplied arms to only one side. That seems to have been overlooked by many hon. Members.

If the right hon. Gentleman had argued that we should support only Israel, I should have understood that. Indeed, as I listened to that debate I thought that many of his right hon. and hon. Friends thought that that was the position he would take up. He is entitled to take it, but in what way would the position of this country be better if we had pursued that policy instead of the one that we did pursue? I cannot accept in any way the condemnation in his outburst this afternoon.

The most encouraging development in the past few days is that the cease-fire called by the Security Council now, at last, appears to be holding. There are still violations, but the way to end these is in increasing the effectiveness of the peace-keeping forces on the ground.

Again, the right hon. Gentleman challenged our position on this matter. We think that the Council was right to exclude the forces of its permanent members from the present UNEF, because that was the best way of solving the problem which existed between the Soviet Union and the United States. But in our view, the force necessary to guarantee a permanent settlement between the Arabs and Israelis would need to be of a different character. It should then be reconsidered. We as a Government will be ready to provide a British contribution to it, if that contribution is required.

The Security Council has also called for the urgent implementation of Resolution 242. I should warn the House that unless there is a real prospect of negotiations soon, acceptance of the present cease-fire will rapidly be undermined. We do not know the exact position of all the parties at present as to the form which the negotiations should take. We believe that some form of United Nations presence in the negotiations would be desirable and helpful in bringing about a settlement, certainly in the first stages. But we, as a Government and as a member of the Security Council, are flexible on the matter. What is absolutely clear is that it is in the British interest as well as in the interests of the other members of the Security Council and the whole Middle East that the negotiations should start quickly.

The immediate task is to defuse the most dangerous aspects of the military situation—for example, the position of the Egyptian Third Army. In the Government's view, this might best be done by a reciprocal arrangement between Egypt and Israel, which need not be related to the broader issues of an overall settlement. It is urgent that there should be such an arrangement.

On the shape of a permanent settlement, our views remain unchanged. My right hon. Friend the Foreign and Commonwealth Secretary put forward, as long ago as 1970, proposals for reconciling Israel's need for security with the need of her neighbours for the restoration of their sovereignty. We do not believe that either reconciliation or a settlement is attainable on the basis of retention by Israel of large areas of Arab territory, but we do believe that both can be brought about by means of a system of demilitarised zones policed by a powerful international force. We also believe that such a package would serve not only to police a settlement but to consolidate it.

The Leader of the Opposition has spoken about the circumstances in which the American Government declared a precautionary alert of their forces early in the morning of Thursday 25th October. Perhaps I may say a word about that, because it needs to be put into perspective. The forces involved were exclusively United States national forces: it was a national alert. The North Atlantic Alliance, as such, has not been involved. The United States forces involved were placed on a relatively low-level alert, which did not involve the immediate prospect of action. We were informed at a very early stage.

The operational use of facilities in this country was not in question. If it had been in question, it would have been governed by the agreement between the British Government and the United States Government which has been in force for many years under several administrations and which remains valid. I hope that that makes clear the position about the alert and this country.

Mr. Christopher Mayhew (Woolwich, East)

Has the Prime Minister any evidence of any planned or actual Soviet troop movements to the Middle East at that time?

The Prime Minister

I am just coming on to deal with the situation as the United States administration saw it. On the basis of their intelligence information and their dealings with the Soviets, the American Government came to the conclusion, last Wednesday evening, that a potentially critical situation was arising. They foresaw a real possibility that the forces of the United States and the Soviet Union would shortly be confronting each other on the ground in the Middle East.

It was against that background that President Nixon took his decision. I do not see that there is any profit in speculating now whether it was the only decision that could have been taken. What matters is that the crisis passed. A cease-fire has been established, the United Nations emergency force has been constituted, and the advance party has been flown into the battle area, much of it by the Royal Air Force, in a remarkably short time. No Soviet or American troops are participating in that force. It is the situation now that matters.

Mr. Hugh Jenkins (Putney)

Before the Prime Minister leaves the subject, some clarification is necessary of the difference between a national alert and the operational attitude of the American forces in this country. What is the purpose of a national alert if it is not to prepare for military operations? If military operations are embarked on by forces in this country, are not the people and Government of this country concerned?

The Prime Minister

If the hon. Gentleman will do me the courtesy of reading in HANSARD tomorrow what I have said, he will see that I pointed out that the alert which the Americans called was at a low level, and was a national alert, and that if there had been any question of operations it was completely covered by the agreement between the United States administration and the British Government, an agreement which has been in force under several administrations and is still valid. I think that deals with the hon. Gentleman's point.

The outcome was in my view the right one, and one which we welcome. The United Nations and the international community in general have played an important part in bringing it about. But it would be wrong to ignore the vital rôle of the American Government. Their continue involvement will be essential if a just and lasting peace in the Middle East is to be achieved.

The Leader of the Opposition also sugested that there has not been close consultation between us and the United States, or between the European coun- tries, throughout this difficult month. That is absolutely wrong. We have been in constant diplomatic contact, naturally, with all our allies, but also with the other main parties to the conflict, throughout this difficult and dangerous month. The German Chancellor was at Chequers when the conflict broke out, and we were able to keep him entirely in the picture and have consultations with him. The Middle East situation is one of the matters that I shall be discussing with the French President when he comes to Chequers in just over a fortnight's time.

One of our major preoccupations as a nation and a Government must be with the implications for our resources of energy, in both the short and the long term. But that is not a problem that has suddenly come upon us. The Government have been planning ahead in this respect for several years.

My right hon. Friend the Secretary of State for Trade and Industry made his statement last week about the short-term situation, but I want to add something today. We have received firm assurances from important oil-producing countries that they have no wish whatever to damage this country, and that they will take what steps are within their power to prevent that happening. We welcome those assurances, which we believe are of great value to us.

Of course, the direct effects of the Middle East conflict, through the closure of terminals and the resulting cuts in production, have produced some disruption in the normal machinery of distribution.

Mr. Dick Douglas (Clackmannan and East Stirlingshire)

rose——

The Prime Minister

This has introduced a degree of uncertainty that is bound to continue for some little time yet, and we shall continue to keep a daily watch on this aspect of the short-term supply position.

Mr. F. A. Burden (Gillingham)

rose——

The Prime Minister

If I may finish what I have to say about energy, perhaps my hon. Friends and other hon. Members will be able to judge the position better.

It has been suggested in some quarters—not by the Leader of the Opposition today—that the Government should now introduce a scheme of rationing and control. The Government will not hesitate to do this if and when we judge that the moment is right. At present we are sure that the moment has not yet arrived.

We have a high level of stocks, sufficient for 79 days' consumption. A further 30 days' supplies are on the way. There is, of course, a difference in length of the individual items within those stocks, as the right hon. Gentleman will understand, because he has touched on some aspects of them. But it is a high level of stocks and it is the result of prudent action, both by the Government and by the oil companies.

In our view it would be wrong to be rushed prematurely into a scheme to cut down consumption, whether by rationing or by other means, before the needs have been clearly established. It would not be right to upset the flow of industrial production and cause hardship to individuals until the shortfall in our supplies, which may not be very significant, can be estimated more definitely.

I repeat to the House that should such measures be required this Government will not hesitate for one moment to take them. If more powers are required we shall not hesitate to come to Parliament and ask for them. In the longer term our first priority must be to bring the consumer and the producer Governments together in an attempt to restore stability to the market. Again, that must be in the interests of everyone.

As for our alternative sources of energy, in a little more than a year's time oil will begin to flow from the North Sea in increasing quantities. If it can be brought out sooner it will be. The Government have given that a high degree of priority. I am informed that the electricity generating systems have ample flexibility to burn all available coal in place of oil. We have halted the decline in coal production. Perhaps I might remind the Leader of the Opposition that between 1964 and 1970, coal production dropped by 50 million tons. We have halted that drop and, with the Government's support, the National Coal Board has carried out an intensified exploration programme. As the House knows—and the right hon. Gentleman has commented on it—there have been developments with considerable promise for the future.

On gas supplies, 90 per cent. of our gas now comes from the North Sea. On nuclear power, we have been strengthening the nuclear construction industry. We are pressing ahead with the fast breeder reactor. We are developing other types to give us a choice when the next generation of stations is being built. Important decisions on the next generation of thermal reactors and on a new programme of construction will have to be taken in the next few months.

I sum up the energy position. We are not faced with a problem that was unforeseen, or which we lack the resources and skills to solve. But it is a major problem which will make much demands on our diplomacy abroad and on our ingenuity and determination at home. In the short term it will pose difficulties for our balance of payments. Again, these are difficulties which, with our present competitiveness in international markets, we can overcome if we can keep our domestic costs and prices as competitive as they are now and do not dissipate our energies as a nation in internal disputes.

Mr. Burden

My right hon. Friend might be surprised to hear that an American company selling oil in this country has today confirmed to me on the telephone that it will not honour contracts with old customers without long-term tied contracts. The company is refusing to deliver oil to people who had been buying from them for two years or more. Is this not utterly reprehensible in the circumstances?

The Prime Minister

I prefer not to comment on an individual case without knowing the details. If my hon. Friend will let me have them, or will supply them to my right hon. Friend the Secretary of State for Trade and Industry, this is a matter into which we can inquire immediately. The position as I have given it is as it is at the moment.

Mr. Douglas

Returning to the Prime Minister's point about assurances from the oil-producing countries, why cannot the right hon. Gentleman suggest to them that these assurances would have greater meaning if we were not confronted with unilateral breaches of agreements arrived at so recently?

The Prime Minister

If the hon. Gentleman is referring to the price agreements with OPEC, I agree very much with what he says. As for the assurances which we have been given, I wish to see them carried out. That is our position at the moment.

I said that we could deal with these problems if we kept our competitiveness and did not dissipate our energies in internal disputes.

Mr. Harold Wilson

The right hon. Gentleman has dealt fully with the energy situation, and we are grateful to him. However, I wish to return to what he said about the Middle East. I did not want to interrupt him too early in what he had to say about it. Will he tell the House the attitude of Her Majesty's Government on the arms embargo? Can he also tell the House anything about the reported threats to the freedom of the seas in the Straits of Bab-el-Mandeb? If not, may we have an answer tomorrow from the Foreign and Commonwealth Secretary?

The Prime Minister

Until we can see clearly how the pattern will develop in the Middle East, our view is that the arms embargo should remain. On the other matter which the right hon. Gentleman raised, he himself was good enough to say that he did not wish me to discuss it in detail if it was not suitable to do so——

Mr. Harold Wilson

The Straits?

The Prime Minister

Yes. This is a matter with which I prefer not to deal at the moment. It is involved in other matters that we are trying to handle

Today the Government have laid before the House the order setting out the definitive price and pay code for stage 3. This will come into effect for prices on 1st November and for pay on 7th November, the anniversary of the standstill. In this final version we have taken account of a number of the points made in the House and elsewhere on the consultative document which was published on 8th October. A list of the more important changes has been placed in the Library. But it is essentially the same package and structure as I described to the House on 17th October, maintaining a strict control of prices, safeguarding a growing volume of investment and at the same time providing greater flexibility for pay negotiations within a framework of rules which are firm but fair and offering special help for the lower paid.

As people begin, in negotiations, to see what these provisions hold for them and appreciate the extent to which they can be matched to their situations, I believe that they will recognise that this is a firm and reasonable policy. We are at an early point yet in assessing the reactions to stage 3, but there have been some preliminary criticisms from both sides of industry which might indicate that we have got it about right.

It is fair for the low paid, for many of whom an offer up to the limit of £2.25 would be the largest increase that they have ever had. It is fair to those like miners, transport workers and firemen whose work involves inconvenient hours for which the rate of payment falls below a minimum standard. The Leader of the Opposition touched on the miners and some of their problems. We recognise those problems. However, the National Coal Board has been able to offer miners an increase of 13 per cent. In addition they can negotiate an acceptable efficiency scheme. So within the policy and the framework, the low paid can improve their position relative to others—

Mr. Dennis Skinner (Bolsover)

rose——

The Prime Minister

I am sorry. I cannot give way.

Mr. Skinner

Tell us about Sir John Stratton.

The Prime Minister

The opportunity to negotiate efficiency schemes is a fair one, and the cost of living safeguard is fair to all.

Let us be clear. It is only by improving their relative positions that such groups as the Leader of the Opposition referred to can achieve any real advantage. If everyone is a special case, no one is any better off comparatively speaking and we shall not solve the problems to which the right hon. Gentleman addressed himself. We shall not attract more workers to the mines, to transport or to any other vitally needed service if everyone is free to bid up the general level of pay and to leapfrog other people. That is the reality to which the Leader of the Opposition must address himself.

Those who are pressing for their special claims to be met and talking about industrial action must answer two simple questions. Do they think that every special claim ought to be met? If so, as I have said, they will be no better off and we shall all suffer from further wage inflation. If they are not seeking faster inflation, who is to be pushed aside in order that their special claim can be met? That is the real problem which has to be faced and it is because of this that a framework has been created in which there is great flexibility.

Who is to be pushed on one side? It is not the highly paid, because they are already firmly limited by the code. It is not profits or dividends. In the private sector they are controlled. In the nationalised industries priority has already been given to the counter-inflation policy and the Exchequer—in other words the taxpayer—is meeting the deficit. So who is to be pushed on one side? It can only be other groups with competing claims or the mass of ordinary people who will have to bear the effects of rising prices. Those are the only alternatives open to us.

The second question concerns industrial action. Who would really gain from it? We all know who would suffer. It is the general public who would suffer especially at a time when the whole nation next winter may be meeting the difficulties which I have described about oil from overseas.

Last year we brought before the House measures for supporting our coal industry. We were criticised in some quarters. But we took this action precisely because we knew that there was a degree of political risk with the oil which we have to import. But the argument depended on the view that, when it came to the crunch, when the national need was clear we could rely on our home-produced supplies being available.

As I have said, we are still at a very early stage in regard to stage 3. We have listened to the points which have been made to us from all sides, and we shall continue to listen. I believe that in return we can expect all those on both sides of industry who have responsibility in these matters to exercise that responsibility with the same wisdom and aware- ness of the national need which they showed in stage 1 and stage 2 and from which the country has undoubtedly benefited.

Mr. Stanley Orme (Salford, West)

Will the Prime Minister explain how it is that there are two categories of people in the country, one category caught under his stage 2 and stage 3 and one category completely outside them? As my right hon. Friend the Leader of the Opposition said, there are people who are evading the policy completely because it is possible for them to be offered some redesignation of their jobs involving different wages, yet there are people like miners, engineers and others who are caught by the policy. Where is the fairness in that?

The Prime Minister

During the debate on the consultative document for stage 3 I gave figures of the large number of wage settlements which have been registered with and approved by the Pay Board. The figures cover a very large part of the working population. If there are evasions they can be reported to the Pay Board for legal action to be taken. If the hon. Gentleman is not prepared to accept that, he must suggest an alternative way.

Are the Opposition suggesting that we should now deflate and have much higher unemployment because we have certain difficulties in a policy which cannot be absolutely perfect? If they do, let them say so frankly. Do they want to see expansion brought to a standstill, or will they find some other way by which these matters can be handled more reasonably?

One leading economist observed that the extreme left wing, which now dominates the Labour leadership, had played a decisive part in the defeat of an incomes policy: They want to plan everything and nationalise most things, while at the same time insisting on a monopolistic free-for-all in the determination of wages and salaries, demanding, Canute-like, that inflation should be stopped by price controls. I am sure that the Leader of the Opposition recognises that quotation; it is from his own former personal economic adviser, Lord Balogh.

I have been discussing the ways in which we intend to protect against inflation and to sustain the expansion which this country is at last achieving for itself. We have no doubt—this is the difference between the two sides which has emerged clearly from the Leader of the Opposition's speech—that a competitive free enterprise system provides the best means of getting the prosperity from that expansion.

Our approach is that this system has faults, which I and my colleagues have condemned, but that where those faults exist they should be remedied. That is the purpose of a number of measures in the Gracious Speech. Quite how the right hon. Gentleman—not having seen the measures or been told the contents—finds it so easy to criticise, I do not know. New situations are constantly arising against which the individual must be protected, and that, too, is the purpose of measures outlined in the Gracious Speech.

As a consumer, the individual needs to be protected against the abuse of monopoly, against the insensitivity of the large corporation. Very well. Last Session, we passed the Fair Trading Act to stimulate competition and strengthen the powers of the consumer. This Session, we will do the same for the credit system through which many of today's goods are bought.

As an employee, the individual needs a guarantee that his health and safety at work will be safeguarded. Very well. We are legislating on the lines recommended by the Robens Committee. This will cover about 5 million people not previously within the health and safety legislation and will also provide better protection for the public as a whole. We shall be bringing forward proposals for modernising the rôle and status of employees in the organisations and companies for which they work.

As citizens, people need protection against secrecy and exploitation in the company structure. That is one of the major purposes of the proposed reform of company law. They need protection against discrimination wherever possible, and the measures for this will also be put before Parliament.

Thus, we are carrying forward in this Session the objective which we set ourselves in this Parliament—the creation of a modern free enterprise system which matches the needs of the twentieth century but which respects the rights and interests of the individual. It is summed up in a key sentence of the Gracious Speech: My Government's objective throughout will be to promote the interests of the individual, whether as citizen or consumer. All this legislation is fully consistent with our obligations and aims as members of the European Community. The Community exists for the benefit of its peoples and to meet the needs of the individual. The programme of action put in hand by the 1972 Summit provides for the future development of the Community to meet the changing circumstances and the changing needs of its citizens.

We seek the establishment of a substantial regional development fund, because we believe that the Community should help to look after the problems of the less prosperous areas. We support the movement towards economic and monetary union because this will strengthen the Community and spread its benefits more evenly. We want to see changes in the working of the Community, so that democratic parliamentary processes can play a more effective part. So our European policy fits in with our domestic policy—both are aimed at promoting the interests of the individual and the citizen.

The approach of the Leader of the Opposition is quite a different one. His aim is not to improve the free enterprise system—but to destroy it—to grab a large part of it at once, to tax the rest out of existence and to ignore the interests of the individual. It is a programme of nationalisation and State control, of which the right hon. Gentleman has boasted, on a scale which makes the arguments over the 25 companies appear like a dispute whether to have a comma or a semicolon in a declaration of war.

They would not leave the companies which have shown the initiative in finding oil in the North Sea to bring it out. They think that they can do it better themselves. Their record does not give much ground for confidence. Their housing policy would not concentrate, as ours does, on the areas where the need is greatest and on the people who need most help. They have threatened to take everything over—land, the construction industry, private-rented accommodation, the lot.

And that is not all. The ports, shipbuilding, the aircraft industry, the machine tool industry, the pharmaceutical industry are all on the list. Even the clearing banks, insurance companies, the building societies are not immune. They would all be under the enlightened management of the National Executive—I mean the National Enterprise Board. What is incredible is that, in all the weary pages of the Leader of the Opposition's speech to his party conference about taking over huge sectors of British manufacturing industries, the word "consumer" or "customer" does not occur once.

But I do not think that the British people will be taken in by such a programme. I do not think that they will lightly opt for the tyranny of uniformity, the tyranny of nationalised monopoly, the tyranny of "take it or leave it". I believe that they will prefer an approach which is based on the free enterprise system, which recognises and deals with its faults, which provides fairly and compassionately for the weaker sections of the community, and which offers freedom and opportunity in the future. That is the policy of the Government, as set out in the Gracious Speech; I believe that it will have the support of the whole country.

4.22 p.m.

Mr. Laurie Pavitt (Willesden, West)

In the perpetual firework display that this House provides for the country, in a Session which will inevitably have its damp squibs, the opening of Parliament and the Gracious Speech give us the opportunity for a few set pieces which over the years have inclined to cover a wide range and among which, of course, we expect a few explosions from the Front Benches.

In the Prime Minister's speech, which, inevitably in discussing a complete Session's programme, was wide-ranging, as was that of my right hon. Friend the Leader of the Opposition, the point which affected me most was his explanation of what happened last Wednesday night over the US alert. I am grateful to the right hon. Gentleman for the way in which he spelled out a little what was perhaps the most worrying episode of the decade for most ordinary citizens of this country.

In the wide canvas and the wide number of responsibilities, here and overseas, that this House will be debating in the next few days, most of us who have lived through war periods regard as the greatest hazard, the greatest political responsibility, that of peace and war. Most of us who have been in the House for some time and listened to a number of debates on the loyal Address always go back 10 years to Cuba. We are aware of the destructive capacity of the two major Powers, an ability to get rid of this globe 10 times over and still have nuclear fire power to spare, and fear that, if World War 3 came, it would come not through the foolishness of politicians, statesmen, countries or Governments, but very likely by what might seem sheer accident. This is the point that the Prime Minister made by telling us about the alert last week.

Although there still seems to be a fail-safe below the first low-level alert about which he informed us, nevertheless, at the further levels, there is alarm among most thinking people about so much destructive power being available, about an atomic gunpowder keg which could ignite by accident. None of us can rest easy in his bed while such power exists in the hands of the two major Powers and their statesmen, especially in view of some of the forces pressurising those statesmen.

As one who usually speaks about health matters I hope that the House will forgive me for talking about it as an "institution", but it is to the credit of this institution that, in my period as a Member, both parties have been aware of the dangers in these matters and have attempted to address themselves—although mostly inadequately—to the whole question of disarmament, nuclear disarmament, test ban treaties and the way in which one can perhaps, de-escalate international problems. Events last week make détente now our highest priority.

The House will not expect me to talk much on the first part of the Gracious Speech, although I took up that point because that has been the most important point of the debate so far. In the short time available to me I wish naturally to talk about some other aspects of the Gracious Speech, in particular the point made by the Prime Minister about not wishing the general public to suffer. I want to deal with that in relation to what is happening economically and especially in relation to the suffering of people who may have an illness or a disability—the suffering of the general public. From time to time all of us become hospital patients or need medical services. In the Gracious Speech it is said that the Government will have particular regard to the requirements of the old, the sick and the needy. I shall address myself to that part of the Gracious Speech.

The Prime Minister spoke at length about the way in which he hoped that the inflationary situation would be held fairly and said that we should not make too many special cases. I shall make special cases immediately. Unless in the National Health Service some radical changes are made in the ways in which we recruit, sustain, train and hold tens of thousands of people—this is a highly labour-intensive service—the service itself is in great danger. I ask the House to address itself to the problem of the low-paid workers of the National Health Service, especially those who are not at the bottom of the pile, in terms of being manual workers, but are the semiprofessionals and professionals.

I start with, perhaps, the most overworked and underpaid section, which has been clobbered by phases 1 and 2 of the pay and prices policy. It is, perhaps, the most valuable section of the National Health Service in view of the devotion that it gives to patients. I refer to our nurses.

On Sunday last the Observer had to apologise for giving wrong figures about nurses' pay. It said previously that a ward sister in a London Hospital received between £2,000 and £2,500. That newspaper has now said that the figures should have been £1,515 rising to £2,040. It is again wrong. A girl who was a ward sister at the age of 21 still receives a maximum of only £1,947 after nine years' service.

Rather than talking in generalities about pay, I should like to give the House an example of a ward sister from a recent investigation. After training for four years at Guy's Hospital, she became a State registered nurse. She is working unsocial hours. If she works all day on Sunday, after doing a 40-hour week—she often works alternate Sundays—she receives £1.60 for eight hours' work—20p an hour extra. This ward sister is aged 29. She has responsibility for five other ward sisters and about 30 nurses. After receiving London weighting, working at a London teaching hospital, and after paying income tax and all other deductions, her take-home pay last year was £1,364. If that girl were a machine operator in my constituency of Willesden she could get more money by doing a 40-hour week, not even shift work, in a factory. She received last year, for being on call and for working the extra unsocial hours, a total of £28 for the whole year. Yet, as a sister of a renal dialysis unit, after a transplant she can sometimes work for 18 hours in fighting for a patient's life, and suffer emotionally harrowing effects if the patient dies after the transplant. That nurse may fight for a human life, taking momentous decisions for 18 hours, for some £2, and then find her work of no avail.

Phase 3 must include massive—and I mean massive—uplifts for unsocial hours for nurses. I am glad to see that the Under-Secretary of State for Health and Social Security is present in the Chamber. He and the Secretary of State must do something about the deductions for food, board and lodgings and the fringe benefits for nurses. In cities the girls cannot possibly cope with the competition and with rising prices, and especially with large rent increases.

I commend to the Under-Secretary an examination of what some hospitals have been doing recently. They have not been reckoning that the girls should go into a nurses' home. The House does not like to be called "an institution". Nurses do not like going into a nurses' home. They want independence. The Gracious Speech indicates that the individual should have the right of freedom. A nurse doing one of the most valuable jobs in the community needs to have her own life in her own accommodation. It would be a good thing if the Secretary of State would give further powers to the new regional and area health authorities so that houses and flats outside the hospitals' purview could be provided. There is no greater sector of the under-privileged, under the Government's policy of trying to counter inflation, than the nursing profession.

I draw the attention of the House to other dangers caused by the abysmally low pay of the professions supplementary to medicine without which our hospital service could not continue.

The Under-Secretary and I have had previous exchanges about the Quirk Report on speech therapy. He kindly wrote to me recently to correct a statement saying that the Government had made up their mind about some of the aspects of the report. These decisions ought to be proceeded with expeditiously. In a recent debate I told the hon. Gentleman that, unless he does something quickly about speech therapy, within about 18 months half of the country will have no speech therapy service. At present there are whole regions without this service. How can one expect to cope with this problem when after three years of training a 24-year-old man at a London hospital doing speech therapy on his first full week took home the sum of £11.50? An unskilled lump labourer in London receives £60 a week and does not need three years of training for that work. On the present scale, after three years of training, the salary is £1,209. After 13 years' service in speech therapy the salary is £1,767.

The Under-Secretary is deluding himself if he thinks that it is due to marriage that people leave the speech therapy service. If he examines this matter he will find that the big loss occurs between the ages of 25 and 28 in girls who are unmarried but who find that they can no longer live on the pittance they are given as speech therapists. When they are with other girls of their own age they find they are the poorest of the poor.

It is exactly the same story in relation to physiotherapy. After three years' training the salary is £1,212. At the age of 27 it is £1,542. The Under-Secretary knows that there is a shortfall of 29 per cent. in Wales and 20 per cent. in England. What happens to people with rheumatoid arthritis? What happens to people who have had slipped discs? What happens to people who want hospital service once they leave the doctor's care if there are no physiotherapists?

We hear about the brain drain of doctors. We do not hear about the brawn drain of physiotherapists. They can go to Canada and get four times the salary they get in Britain. I know one who has gone to Denmark recently for four years and who refuses to return because the conditions here do not compare with Denmark's. We should lead the world in the conditions we give, because the training and service we provide is perhaps superior to any in the world.

Unless something is done about our appalling pay and conditions, the service can do nothing but run down. I accuse the Department of sheer dilatory incompetence, because it has been negotiating with the physiotherapists for three years to try to get a new career structure. The minutes of last January's meeting are not yet available, and because a civil servant is likely to change on 1st November they are not likely to get a further meeting until some time in the new year. I wonder what would happen if the problems of the miners and firemen were dealt with on the same time scale. The inefficiency would inevitably lead to much greater conflagrations than we have now.

The National Health Service has been reorganised on a philosophic basis of managerial efficiency. My own hospital, the Central Middlesex in the London borough of Brent, is 15 porters short. This hospital is situated in the middle of a factory area, the Park Royal Industrial Estate. Any porter could walk through the hospital doors and cross the road and obtain a job immediately at £5 a week more than he gets at the hospital. What is the good of having a surgeon consultant on an A-merit award at £16,000 a year if there are no porters to wheel the patients into the operating theatre so that operations can be performed?

It is all very well to have all the glitter and polish of a modern hospital, but if there is not the manpower to make it move it remains a monument and mere bricks and mortar. It is time the Under-Secretary came down from the stratosphere and stopped looking at the apex of the hospital pyramid and looked at the base. Unless he does some very rapid repairs at that level the whole structure is likely to crumble.

It is not mentioned in the Gracious Speech, but on 9th June the Secretary of State made a momentous decision affecting those who suffer from the disability of deafness. The whole House, this side no more than the other, welcomes the Government's decision that in future these people will be given a free aid which does not have a cord and is not attached to a box but is like the one I am wearing—attached behind the ear.

That decision will be no more than a theory unless the Secretary of State can do something immediately and urgently about the pay structure of audiological technicians. The Secretary of State has given himself five years to complete the programme, but unless a crash programme is embarked upon for training he will not be able to have the dispensers for one-tenth of the programme that he hopes to pursue, even bearing in mind the slow programme phasing priority for certain classes.

At present in the whole country there are only 297 audiological technicians and 79 registered students. Is it not time the pay and training structure of this sector was examined—only one year's training needs to be given—with a view to getting sufficient people to fit the instrument which people who are disabled by deafness must have?

The last of the professions supplementary to medicine which I intend to mention and which is sometimes treated as a bit of a joke is chiropody. This is no joke to elderly people, especially elderly ladies who over the years have had to spend a good deal of time working on their feet and for whom walking is an agony. In the last 15 years we have made great strides. All administrations have sought through the Social Services Department to provide chiropody services free of charge to elderly persons. In my area we cannot get enough chiropodists because the pay is so small and the training demands are heavy.

The demand on the service is such that one chiropodist in my area said to me, "It is as well the old girl cannot see. I can only devote 10 minutes to her. I have time to do two of these corns. Which ones hurt the most? I will do those. She must go hobbling away on the rest because I have no time to do them."

It is no good in national life showing visitors from overseas what marvellous public buildings and hospitals we are building and what marvellous centres for senior citizens we are providing unless we do something about the pay and conditions of the personnel who must man them.

What is wrong with the Government's policy in phase 3 and in health and social security as a whole is that they seek to patch a system of inadequate pay, long hours, and qualified, professionally trained people, without bringing to bear on it the urgency and the radical overhaul needed if we are to stop the rot that has developed over the last three or four years.

I apologise to the House for dwelling on a very small portion of the Gracious Speech, but we are all users and consumers of the health service. While the Government concentrate entirely on those at the top, on the doctors and on the more highly paid professional and skilled administrators, and ignore entirely the poor nurses, the poor ancillary workers, the porters, those who work the laundries, those who keep the service running, I for-see with regret that when the Labour Party wins the next election we shall inherit such a mess that it will take a long time to clear it up.

4.43 p.m.

Mr. David Waddington (Nelson and Colne)

The Leader of the Opposition tried to advance the somewhat novel proposition that the purpose of the debate was to examine the Labour Party's nationalisation proposals. If he had been in a more prudent mood he would have diverted his energies to other directions.

The contribution of the hon. Member for Willesden, West (Mr. Pavitt) was much more appropriate and relevant to the debate. The hon. Gentleman started by mentioning that part of the Gracious Speech which refers to the Government's determination to help the old, the sick and the needy.

The public are becoming more and more aware that this Government's contribution in those directions has been much greater than that of the last administration. When we think of pensions for the over-80s, the family income supplement, the constant attendance allowance, and greater help for the long-term sick, we begin to realise that this has been a reforming administration, particularly in health and social security. I have found in my constituency a greater awareness of this as the months have passed.

It has always struck me as being very unfortunate that over the years Gallup Poll after Gallup Poll has apparently produced results suggesting that a Conservative Government are considered a less compassionate Government than a Labour Government and the Conservative Party a less compassionate party than the Labour Party. Yet, when one looks at the results on the ground, one can only assume that those Gallup Poll results are more the results of assiduous propaganda than of any intelligent examination of the facts.

The hon. Member for Willesden, West, is a great enthusiast about hospital administration, as well as about the health service, and we all admire his expertise. However, I think he will agree with me that most of us in the House of Commons—I do not mean the few who are present to listen to my speech—recognise the need for an incomes policy, even though we are prepared to argue long as to the details of that policy, as to how it should be administered and as to the criteria that should apply.

I think the hon. Member will also agree with me when I say that the difficulty is that we all have our own pet special case, and at some time during his period in this House every Member has advanced a special interest. Each one of us has risen to his feet to try to persuade the Government that a certain class of employees was deserving of special help, usually at a period of economic difficulty. Of course I understand entirely what the hon. Member for Willesden, West, said about some of the health service employees, but many of his hon. Friends would have argued just as eloquently for the firemen in Glasgow, for the miners or for numerous other classes of work-people. We must all recognise that, if every alleged special case is accepted as a real special case, there will be no incomes policy at all and we shall make no headway in our attempts to combat inflation.

I should like to mention one or two matters which are specifically mentioned in the Gracious Speech. In the third paragraph on page two there is a reference to the need to "contain public expenditure", but on the next page there is a reference to the Government's determination to introduce a Bill dealing with the financing of the Channel Tunnel. I hope that the Government are aware of the feeling in the regions that it would be quite unjustifiable to cut back on the vital road developments in the regions in order to make it possible to go ahead with a project such as the Channel Tunnel. My constituents are as determined now as they have ever been to see that there is no more delay in the commencement of the Calder Valley road, the A65. They are bound to be a little perturbed when they see a reference to the need to "contain public expenditure" coupled with an undertaking by the Government to go ahead with quite substantial expenditure. Even if, strictly speaking, it is not public expenditure, it is expenditure which would have a very real effect on the totality of resources.

The Gracious Speech refers to the reform of taxation. I certainly feel that the Government are very well entitled to refer to the reform of taxation, because over these last three years we have seen most important changes in our taxation system. The introduction of the tax credit scheme, which is perhaps an even more radical reform than any which has so far been undertaken, will be not only more just but very much more intelligible to the ordinary man in the street, who, I am quite sure, has often been completely bemused by his coding under Pay as You Earn. I am also sure that the proposals for a greater degree of employee participation, and for more protection for consumers in the field of credit, will have support from both sides of the House.

I should like to mention the reference to, Measures relating to the extraction of petroleum from the United Kingdom Conti nental Shelf. That is a matter of the greatest relevance at the present time, because of events overseas. But I should be glad if the Government would go out of their way to boast a little more about their achievements over the last few years. The Leader of the Opposition today said that it is now Labour's policy to nationalise those resources, but I should have thought any fool would recognise that if those resources had been nationalised three years ago, exploration would not have been carried on at anything like the pace of these years. The whole experience of our nationalised industries shows that to be true.

It is always very easy for the Labour Party to produce figures of vast profits made by individuals or by companies, but the fact remains that it is because profits have been there to be made that exploration has gone on apace; and we are in nothing like as much of a mess as we would have been in if Labour's current proposal, had been put into legislative form three years ago. Of course, the truth of the matter is that the policies which we have pursued have been very much akin to those pursued by the last Labour Government. I am referring in my criticism merely to one of their more inane proposals which was mentioned by the Leader of the Opposition today.

There is then a reference in the Gracious Speech to new …machinery for investigating complaints of maladministration in local government. I should certainly be the first to argue that there is sometimes a lack of confidence when there ought to be confidence, and if this new machinery will make people more confident that their local representatives are looking after their interests properly then I shall be happy. But I should have liked the Government to be prepared to look into this whole field very much more carefully.

I should like to take as an example the question of improvement grants. As a result of the relevant Act of Parliament, it is entirely within the discretion of a local authority whether or not to give an improvement grant to a certain person. The appointment of an Ombudsman to look into maladministration in local government will not alter that situation one whit, and it is time that the Government looked into the whole question whether there should be some machinery for appeals against administrative decisions of local authorities, because some of those administrative decisions—and improvement grants are only one example among many—can have an enormous impact on the individual.

Many of my constituents are completely bemused about why one set of criteria is applied in Nelson, another in Colne, another in Brierfield and another in Barrowford. They are quite bemused when a relative living in another part of the division is given an improvement grant, when their own very similar application is refused out of hand. When the Government are thinking about an Ombudsman to investigate complaints of maladministration, I hope that they will also look at this whole question whether the rights of the individual can be extended quite significantly by a right of appeal to some independent body against some of the administrative decisions which can be made by local authorities as a result of recent Acts of Parliament.

The Queen's Speech also makes it clear that the Government will …strengthen the laws against indecent public advertisement and display". I should have thought that that, again, would receive a very warm welcome indeed. It surely cannot be said to be infringing the liberty of anybody who enjoys reading such publications if he is prevented from reading them outside the shop rather than inside it. It is a gross infringement of the liberty of the majority that they sometimes have to go along a street, which, in the main, is composed of shops of a good standard but have their eyes assailed by some of the displays in the seedier shops.

This is no mouse of a Queen's Speech. This is a Queen's Speech which, in my opinion, contains some really constructive measures. It is built on real achievements during the last three years. They are proposals which will extend the rights of the individual. I would have hoped that in some respects the Government would have been even bolder, but they are certainly not insignificant proposals; they are proposals which will significantly improve the quality of life in this country, as, incidentally, have the measures already taken by the present Government in respect of the environment. I think it was the utmost cheek on the part of the right hon. Gentleman the Leader of the Opposition to say what he said about our achievements in the field of the environment. If he comes to my division he will see a very different Nelson and Colne from the Nelson and Colne which existed only three years ago. It is a brighter and more cheerful place, a cleaner place and a nicer place in which to live, and that is something of which the present Government can be justifiably proud.

4.56 p.m.

Mr. David Weitzman (Stoke Newington and Hackney, North)

I listened very carefully to what the hon. and learned Member for Nelson and Colne (Mr. Waddington) said. I would have liked to deal with some of his arguments, particularly when he alleged that the Conservative Party was just as compassionate as, or even more compassionate than, the Labour Party. I have recollections of an important Bill sponsored by a private Member and passed by the Labour Government—the Chronically Sick and Disabled Persons Act 1970—and I only wish that the present Government would fully implement those provisions. I blame them a great deal for not having done so.

I am afraid the hon. and learned Gentleman must forgive me if I do not follow him in his argument. I want to deal with only one topic. The Gracious Speech contains the statement: My Government will continue to work for a just and lasting peace in the Middle East. What that work is to be, they do not say. As a veteran of the First World War—one of the few remaining in this House—I, like many others, was proud of this country when it issued the Balfour Declaration, which provided a haven for Jewish refugees and which, indeed, was the foundation and the basis of the State of Israel.

After the war of 1957, 16 years ago, Mr. Speaker, who was then Foreign Secretary, said: … Israel, by her withdrawal has fully complied with the first resolution of the General Assembly.… He added: The United Nations accepted the creation of the State of Israel and it cannot permit its destruction…we shall not get peace until Israel has more sensible frontiers."—[Col. 1321, 1328, 1330.] Aneurin Bevan, as the official spokesman for the Labour Opposition, said in the same debate: On both sides of the House, I think that we expect that the United Nations will see to it that Israel's act of courageous faith will not go unrequited. He added: It would strike a blow at the confidence of statesmen all over the world if Mr. Ben-Gurion, who took his political life in his hands in persuading his countrymen to retreat on these conditions, now finds himself faced with what could only be described as an act of faithlessness on the part of those who persuaded him to do what he did."—[OFFICIAL REPORT, 14th March 1957, Vol. 566, c. 1321–37.] Israel withdrew in 1957. Israel was betrayed. In 1967, the Six-Day War followed. Since that date, Israel, standing astride the territories she conquered, has said again and again to her Arab neighbours, "Sit down and talk to us. All we want is to live in peace behind secure borders. We want to develop in peace the democracy we built up over the years. We have, by our efforts, turned the barren desert into a fruitful area and we are ready to help you, the Arabs, to do the same."

The United States has shown in no uncertain way that she recognises the importance of Israel in the Middle East, not only in her own interests but in the interests of Britain and the Western world. Apparently this country, under the present Government, does not. When, on the most holy day in Israel, when it was at prayer, an unprovoked attack was made—an attack obviously prompted by the Soviet Union, with arms supplied by them—not a word of protest came from this Government. Indeed, we leaned over to appear neutral. Despite contracts to supply arms and spares paid for by Israel, we, in the words of the Foreign Secretary, "suspended performance" of these contracts. Israel was fighting for her life. She needed those spares. We suspended the contracts. We did it on the specious excuse that if we remained neutral we could assist in bringing about a cease-fire. We now know what that excuse was worth. The conduct of this Government was so craven that our forces would not be accepted as part of any cease-fire force.

Of course, there is a strong suspicion, despite assurances to the contrary, that we acted in this way because of the threat to our oil supply. If that be the case, yielding to blackmail or attempting to curry favour with the Arabs—I was going to say, before I heard the Prime Minister today—did not seem to put us in a favourable position. Perhaps blackmail has prevailed. We have heard from the Prime Minister that he has had certain assurances from the oil-producing countries concerning our supplies of oil. It is a disgraceful act.

Moreover, despite the so-called special relationship with the United States, we have earned the rebuke, as one of her allies, in having failed to support her when she was acting in our interests. Yet it is said in the Gracious Speech: My Government will continue to attach high importance to our relationship with the United States of America. Here we are, with America acting not only in her interests but in our interests, and we suffer a rebuke in that way.

In the early days of the war many organs of the Press, the radio and television appeared to be gloating over the apparent success of the Arabs, how humiliation had been turned into respect—nay, admiration—because the sudden attack by hordes of Arabs, supported by the might of the Soviet Union, had shattered the illusion, they said, of Israel's military supremacy. We now know how much truth there was in that view.

I hope hon. Members have read an article by Max Hastings in the Evening Standard on Friday last. I cannot resist quoting a short paragraph from it. He said: We have watched Israelis displaying all the qualities for which we look in our civilisation—military genius not least—whilst on the other side stood an enemy of whom there could be no doubt that, armed with an atomic weapon, he would hurl it like a hysterical child. He added: Until this war, I have never liked Israel. But to see this society gathered in arms to save itself has been impossibly emotive. Even now the bias exists. Yesterday's Daily Telegraph carried a story of Egyptian troops firing on a United Nations convoy bringing in badly needed medicine, food and water. What an outcry there would have been if an Israeli force had done that. Israel was immediately ready to supply the names of prisoners. We now hear that Egypt and Syria will supply names but that their prisoners will not be released until Israel falls back. That is a flagrant breach of what is regarded in the Geneva Convention as being obligatory on all States.

I make an earnest plea to the Government—namely, that the words in the Gracious Speech: My Government will continue to work for a just and lasting peace in the Middle East shall mean something. Are we to stand by while the Soviet Union threaten to destroy Israel if Israel does not yield to Soviet pressure? Are we to support Israel in her desire to be allowed to live in peace within secure and realistic borders? Clearly, if Israel had withdrawn from the lands which it conquered in 1967, had an attack of the kind which was made recently been made upon it, Israel would have been in grave peril and perhaps destroyed.

I agree that a Palestinian problem exists and that it must be settled. We must remember that there are Arab refugees and Jewish refugees. From 1947 to 1967 nearly 800,000 Jewish refugees left or were forced to leave Arab countries because of Arab hostility. In many cases they lost everything they possessed. That number has been added to considerably in the years which have passed. Israel tackled the problem of resettling refugees. Israel did not ask and has not asked any of the nations of the world to assist. Israel has not, like the Arab countries, allowed Arab refugees to be kept in camps as a festering sore—as a pawn in the Arabs' hostility to Israel.

Given good will on both sides, there is no doubt that the problem of the Palestinian refugees can be settled. I am glad to have the opportunity to say that I regret and deplore the Government's craven attitude. I only hope that the need for some measure of self-respect and, above all, a recognition of where the true interests of Britain lie, will result in a change of attitude.

5.8 p.m.

Mr. David Knox (Leek)

The hon. and learned Member for Stoke Newington and Hackney, North (Mr. Weitzman) began by saying that he was a veteran of the First World War. I cannot even claim to be a veteran of the Second World War. To some extent that may explain our difference in outlook.

I think that the hon. and learned Gentleman was unfair when he said that Britain did not consider the continuance of the State of Israel as being important. I thought that my right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs made it clear that was not so in the debate the week before last.

Like many hon. Members, I greatly admire what the State of Israel has done since its formation, but that has in no way stopped me from supporting the line which my right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs and the Government took in the recent crisis.

What seems important above all else is the recognition that it would have made little difference in the short term whatever Britain had done. There are still too many people in Britain who do not recognise Britain's changed position in the world and the reduced power which Britain now has.

It seems that the lessons of the Suez crisis of 1956 have not been completely learnt by many people, including those who then opposed the Eden Government. The one lesson to be learnt above all others from the Suez crisis was that in general terms Britain had little military power to affect issues in the world.

I give a general welcome to the Gracious Speech. It seems to mark out a continuation of the strategy which the Government have pursued during the first three Sessions of this Parliament. That has been a strategy of reform, of modernisation and of trying to bring Britain up to date. It is inevitable as this Parliament moves towards its final or final but one Session that the measures proposed in the Gracious Speech this year are somewhat less controversial than in earlier Sessions. Nevertheless, they are important.

Any Government's legislative proposals are important, particularly in the medium and long term, but in the modern world Governments are judged principally by the way they manage the economy and on their ability or lack of ability to achieve a high rate of economic growth. I yield to no hon. Member in the support which I have given to my right hon. Friend the Chancellor of the Exchequer since July 1971 in the measures which he has pursued to obtain a faster rate of economic growth. Any criticism which I have offered thus far has been that my right hon. Friend did not start soon enough. In the last two years the British economy has grown at a fast rate. Admittedly we started with a high level of unemployment and considerable under-utilisation of capital equipment. Much but not all of the slack has been taken up.

We are now approaching the crucial time when we shall see whether Britain can sustain a high rate of growth over a longer period. It is imperative that Britain should be able to do so. Because I believe it is imperative, I welcome the commitment in the Gracious Speech to the sustaining of a high rate of growth. However, I am genuinely concerned about whether the Government's intentions are sufficiently ambitious. In reply to my Question on 25th October my right hon. Friend the Chancellor of the Exchequer said: once the margin of spare capacity in the economy has been taken up it is neither feasible nor wise for economic growth to continue at a pace significantly different from the rate of growth of productive potential."—[OFFICIAL REPORT, 25th October 1973; Vol. 861, c. 1457.] I understand from the Treasury that the rate of growth of productive potential is about 3½ per cent. a year. If the growth in capacity has been 3½ per cent. in conditions of stop-go and stop economic policies, it is likely to be considerably higher in the conditions of sustained economic growth which, I understand, is the Government's policy.

I believe that the plans of my right hon. Friend the Chancellor of the Exchequer for growth in the immediate future are too cautious. My right hon. Friend should plan to increase demand by a larger amount than 3½ per cent. In conditions of sustained growth the creation of additional capital capacity will be greater than in conditions created by stop-go or stop economic policies.

To that end it would seem to me that the time is ripe to use the regulator on VAT in a downward direction. Apart from the effect in increasing demand and so in helping to get a faster rate of growth, such action would have an important and useful effect on the price level and so would contribute to the Government's counter-inflation policy.

I hope that my right hon. Friend the Chancellor of the Exchequer will deal with these points when he intervenees in the debate.

I have said that I consider it to be imperative that Britain should sustain a fast and high rate of growth for a number of years. There are two main reasons for this. The first reason is economic and the second social.

Every time that the "stop" has been imposed in a stop-go cycle since the end of the war, the effect upon business confidence has been more severe and investment has been braked back more violently. Each time the green light has been given for expansion it has been more difficult to rekindle business confidence to the degree necessary to encourage businessmen to start investing again. Today, rather reluctantly in view of their past experiences, businessmen are just beginning to invest on a big scale again. If they were to think that the Government do not intend to sustain a higher rate of growth on a continuing basis their confidence would be completely shattered, investment would be substantially reduced at once and the prospects of it recovering would be remote for a long time. The economic consequence of any faltering by the Government in their policy of creating sustained growth will be disastrous in the long term.

Secondly, I come to the social consequences of any faltering in the growth policy. In recent years living standards in Britain have been overtaken by those in a large number of other industrial countries. The people of Britain have become increasingly puzzled and frustrated by this. During the long deflation from 1965 to 1971 when living standards scarcely rose at all in Britain that puzzlement and frustration expressed itself in a deeper and more profound questioning of our system than had ever taken place before. It was not merely a questioning of our mixed capitalistic system but of our entire democratic system. Industrial relations deteriorated considerably. There was trouble in the universities. The rule of law was being questioned to a considerable degree. Since growth was resumed things have quietened down. There has been an improvement in industrial relations. The universities are calmer. The rule of law is, with some notable exceptions, more respected than it was.

Clearly when the British economic system is working people are less likely to call the whole thing into question. If growth falters, if unemployment rises substantially, if British living standards do not rise as quickly as in other countries, if other countries overtake us, particularly if countries such as Italy, Greece and Spain overtake us, people will conclude, perhaps rightly, that it is our system that is wrong. They will seek to overthrow not just the mixed capitalistic system but parliamentary democracy generally. I appreciate that there is a small minority which may not be particularly concerned about this but it is something that would concern me and, I believe, most hon. and right hon. Members.

When we look at the United States, the Soviet Union and other countries, it seems that our system is not just the least bad but is probably the best in the world. I consider it to be worth preserving. It will be preserved only if it produces the goods, and that means living standards comparable to other industrial countries. To achieve that we need much faster growth on a sustained basis than we have had before.

There is one omission from the Gracious Speech which I regret. It is the reduction in the age at which people can stand for election to this House from 21 to 18. Mr. Speaker's Conference is considering a large number of questions concerned with electoral law. For one reason or another, all of the other things we are considering cannot be put into legislative form and made effective before the next election. This matter is rather different. It could be enacted in this Session. People from the age of 18 upwards would then be able to stand in all future parliamentary elections.

It is regrettable that this proposal has not been included for three main reasons. In the first place it seems to be the logical consequence of reducing the voting age to 18. There is no particular reason why the age at which people stand for election should not also be 18.

Secondly, it is regrettable that this proposal has not been included in the Gracious Speech because public opinion, particularly among younger people, is beginning increasingly to demand this. That is the impression that I get when I meet young people in my capacity as Honorary Secretary of the Federation of Conservative Students, from visits to universities, and from other contacts with young people. It is not just an opinion confined to members and supporters of one political party. It includes supporters of all parties and those who do not support any political party. At present this is still a rising demand. It would seem right that Parliament should anticipate it and enact the necessary legislation.

The third reason why this proposal should have been included in this year's legislative programme is that I believe that it will make a contribution to lowering the average age in this House. This is essentially a middle-aged and old man's assembly. I hesitate to say that it is a middle-aged and an old woman's assembly. If we lower the age at which people can stand for this House it does not mean that the place will immediately be flooded with 18-year olds and 19-year olds. But it will mean that people will stand for Parliament at earlier ages which in turn will, perhaps, lead to their being elected at an earlier average age than is the case now.

One of the points that struck me most strongly when I first arrived here in 1970 was that whereas in industry I had reached an age at which people were beginning to regard me as middle-aged, as soon as I became a Member of Parliament—[Interruption.] That is rather rich coming from the hon. Member for West Stirlingshire (Mr. Baxter) who I think is old enough to be my father if not my grandfather. The point I was making is that whereas in industry I had reached an age when people were beginning to regard me as middle-aged, as soon as I entered this House I was regarded as young, not only here but outside. Although it may surprise some hon. Members to know it, when I attend functions in my constituency and elsewhere people remark on my youth.

This House is supposed to be a representative assembly. It is not in the age of its Members. I believe that if we bring the age at which people can enter the House down to 18 it will help to make it a more representative assembly. I therefore deeply regret the omission of mention of this item from the Gracious Speech.

Finally, the Gracious Speech mentions the development of the European Economic Community. It has always seemed to me that one of the greatest arguments in favour of British entry to the Community was that we should take our democratic traditions with us. Now that we are members, I believe that more thought must be given to the democratisation of European institutions, particularly in developing the direct election of members to the European Parliament. I recognise that the Parliament itself is responsible for drawing up proposals for election by direct universal suffrage, but I believe that this will not come unless pressure is brought to bear by Governments of the member countries of the European Economic Community and by Members of the Parliaments of member countries.

There would appear to be a particular responsibility not only on the present Government but on all hon. Members to bring pressure to bear on that issue, particularly because of our democratic traditions and the importance, in due course, of similar democratic practices being adopted in Europe I hope that this Session of Parliament will see that pressure being exerted on a greater scale.

5.25 p.m.

Mr. Neil McBride (Swansea, East)

The hon. Member for Leek (Mr. Knox) will, I am sure, forgive me if I do not follow him through the by-ways of the merits and demerits of age, as he assumes the mantle of the wisdom of age, though I must observe that, if one took his argument to its logical conclusion the hon. Lady the Member for Birmingham, Edgbaston (Mrs. Knight) would merit the description of "old lady", and we could not accept that.

In the second paragraph of the Gracious Speech the Government state their policy in respect of the European Economic Community, but there is no mention of renegotiation of the terms. I assume that the Government are satisfied with the terms, and, although a farmer is sitting on their Front Bench, in the person of the Under-Secretary of State for Northern Ireland, we note that there is no mention of alteration of the common agricultural policy, that financial millstone round our neck. As a member of the Government the hon. Gentleman must be aware also that the policy of monetary union, the Werner plan, as it stands has as a basic principle that no member State will have full control of its regional policy.

The most fallacious assertion in that paragraph of the Gracious Speech, however, is as follows: My Government's objective throughout will be to promote the interests of the individual, whether as citizen or as consumer. No one, certainly none of the housewives in the great South Wales urban constituency which I have the honour to represent, will believe the Prime Minister for a moment. Those housewives take the reverse view, that the right hon. Gentleman is a stranger to the truth when he makes that assertion.

With a sense of disenchantment amounting almost to foreboding the British people recall the Fanfare for Europe which was launched with such a flourish of publicity in January this year. Towards the end of the year they have realised that membership of the Common Market should induce this Tory Government to introduce a fanfare for failure. The obsessional wish of the Prime Minister and this discredited Government to join the EEC, and the Prime Minister's refusal to consult the British people about entry into this French-dominated customs union and capitalist club, are matched only by his fanatical exposition of the opportunities which he has described so often to the British people and to industrialists as being available to them.

It has been proved that the Prime Minister made false anticipations and deluded the British people. In his headlong rush to be accorded a place in history the right hon. Gentleman—certainly, one of the most incompetent Prime Ministers we have ever had—has found a place in history as the man who sold his country down the river. All this contrasts somewhat oddly with the reality of the position confronting the nation now.

With memories of the right hon. Gentleman's disgraceful surrender to the President of France, and recalling the terrible interview which he gave in sauce-bottle French on television, I think back to a more recent television programme only a few weeks ago in which we heard the observations of a man who forswore allegiance to his country when he became a European commissioner. This former Member of the House, Mr. George Thomson, declared that it would take a generation to realise the opportunities in the Common Market. We are all shareholders in Britain, and no company, no body of shareholders, can afford to wait that long for a dividend. Yet that observation was made in the presence of the man who is "Minister for Europe", one of the most broken political reeds ever seen in the House.

We view the Government's policy with a sense of alarm. We should respect the sovereign will of this House and of the British people, and seek renegotiation of the terms of entry, submitting the issue thereafter to the people so that they may decide whether those terms are acceptable. Clearly, all right hon. and hon. Members on the Government side who voted for entry into the Common Market did so falsely, never having put the matter to their constituents in terms of their manifesto.

One only has to look at the common agricultural policy and the wish of the French Government to retain it in order to featherbed French farming inefficiency at the expense of the member nations of the enlarged Common Market, of which we are one, to realise that the French will be opposed to any revision of the ragbag of clauses which is the common agricultural policy.

There is no sense of accountability in the EEC Commission. Anyone who goes to Brussels—some of my hon. Friends have been, as I have—is alarmed at the manner in which the Commission is cocooned from contact with the public, and that induces in its officials the sense of infallibility which is all-pervading in the headquarters of the Common Market.

When I visited the Commission I went with a sense of apprehension as an opponent of the Common Market. I came back confirmed in my opposition and with a deep sense of alarm, because the EEC officials, in their insulation, disregard any suggestion that they should be accountable, and disregard any opposition from sovereign parliaments or states, from any or all of the member States of the EEC. For anyone to suggest that membership of the Strasbourg Parliament is any protection against this complete and absolute finality of the Commission's decisions is a derisive parody of the truth. I am a former delegate to the Council of Europe and I know exactly what I speak about. It is now apparent in the Community that the EEC Commission will set the long-term Community interests as superior to and overriding all and any national interests of the member States.

This could militate against the objective of the Tory Government, who expect to redress the balance of payments loss, represented by their contributions to the common agricultural policy, by securing a big share of the Common Market regional fund in order, as they hope, to convince the British electorate that the Tory Government are not frittering away our nation's resources. They do not wish to say that they are so doing, and they cannot afford to say to the British people that they have nothing in incoming payments from the EEC to balance the outgoings to the common agricultural policy, which so severly handicaps us financially.

This is a serious matter, emphasised by the Finance Minister of Eire, who supported the Dutch and the Italians in requesting a drastic appraisal of the Common Market regional policy. These three member States advocate proposals other than population criteria as they are insisting on the concentration of the bulk of the regional fund in the most backward regions of the EEC, and this is a negation of policy outlined by the Regional Commissioner in Brussels, a former Member of this House. Should this point of view prevail, and the regional fund be not spread thinly, as he hopes, the position of all nine member States becomes desperate.

The British Tory Government are looking hopefully for an overall gain in this aspect of membership of the EEC. Furthermore, West Germany, one of the world's strongest economic strongholds, and France want to share to a larger extent the Common Market regional fund. They believe that it should be related to contributions from these countries. France is benefiting largely from the EEC's present financial position. West Germany believes that she will be asked to pay too much. Both will consider themselves bound to make contributions, but no larger than is necessary. In this situation, discussion of the needs of peripheral and central areas tends towards the academic.

My constituency is in the little country of Wales, the most peripheral country in the Common Market. One wonders about the size of the contribution that will be made towards that small nation. The Secretary of State for Wales has sent officials to the Commission. They have returned with reports, yet he steadfastly refuses to make available to the elected Members for Welsh constituencies any of the information gathered. Therefore, the best hope for the Principality and all other regions for financial assistance lies in the return of a Labour Government to power.

There is no concealment of the Tory Ministers' view reported on the tape machines in this building on 11th July that the United Kingdom hopes to make changes in EEC policy. Every member of the Government knows that should there be a failure to effect changes in EEC policy, the United Kingdom will face the prospect of a continuing debit balance with the Community, in which event there would be nothing left in the Common Market for this country. Among all the areas of possible change in Community policy the all-embracing common agricultural policy, which is admitted even by the most ardent pro-Marketeers to be enormously expensive to our country, must be the first candidate for revision.

New attitudes must prevail in relation to regional policy. It must be recognised that few other Common Market countries have the same need to achieve change as has the United Kingdom in relation to the whole sweep of Community policy. If, as reported on that tape, some Tory Ministers feel that the harsh realities of the situation should be made public, it is pertinent to ask, "Why have they not been made public?".

One can only assume that the Government face a great political difficulty here. The Prime Minister refrained from making the facts public only because, had he done so, the Opposition's assertion that renegotiation of the terms of entry into this capitalist club is long overdue would have been confirmed.

In spite of the euphoria attendant on the signing of the Treaty of Accession, and painful in our memory of the doings of this politically bankrupt Government, the non-success of the Common Market is now seen as a memorial to the greatest collection of political incompetents ever assembled on the Government Front Bench.

Industrialists and pro-Marketeers consider that standardisation, born of our involvement in the Community, would yield a great balance sheet benefit. Indeed, pro-Marketeers declared it to be the great prize.

Mr. Richard Buchanan (Glasgow, Springburn)

My hon. Friend is making some play of the balance sheet. On which side of the balance sheet would he put the millions of lives that have been saved in Europe? I had a brother killed in Europe. There has not been a gun fired in anger in Europe since 1945, since those far-seeing men set out to unite Europe. On which side of his balance sheet will my hon. Friend put the silent witnesses to the folly of parochialism?

Mr. McBride

My hon. Friend knows—none better—that I abhor war and hurt to anyone, but his argument loses relevance because it is not related to the peaceful discussion of economics in relation to the Common Market and our country's part in it.

"Harmonisation" and "standardisation" are terms that were once used with awe in this House. Pro-Marketeers used them often. Yet it is significant that Lord Stokes, chairman of British Leyland, possibly the best salesman this country has ever had, recently attacked the red tape of the Common Market on the ground that it is likely to result in all of us losing our identity of enterprise and being subjected to an ever-increasing mass of harmonisation and legislation.

The Common Market is a mass of obscurantism and obstruction. One recognises the threat to the rigidity of legislation emerging from the Community. The EEC, particularly France, hopes that this legislation will protect Continental beet farmers. The detrimental effects of this legislation, not only to our own country, but to one-crop economy countries, such as the sugar islands of the West Indies, are apparent. We discussed that subject fully last week. It has serious implications for employment opportunities in this country.

My hon. Friend the Member for Glasgow, Springburn (Mr. Buchanan) knows that wars and natural disasters unfortunately occur, but the EEC Commission places everything in its order of importance by deciding whether British chickens shall reach British shops in fresh-plucked form to be purchased by British housewives.

The truth must be realised by the Prime Minister, who is not usually perceptive. The present terms, which were agreed in surrender, make our country highly vulnerable. Should the Prime Minister find the going hard and a little warm, I believe that the British people would join in re-uttering that famous sentence of Harry Truman, "If you can't stand the heat, keep out of the kitchen".

The hon. Member for Leek talked of prices. One thing I know is that my Labour pound from 1965 to 1970 purchased far more for my wife and myself than has the Tory pound since 1970. Increased prices have cost the British housewife £1,400 million in the past year. No one can persuade me that entry into the Common Market is not responsible for much of that. It is only necessary to walk down the main streets of Mannheim in West Germany, or Paris, or Strasbourg, to realise that if the people in those places are paid high wages, they need them to live. Except ardent Tories, no one will say that entry into the Common Market has had no effect on prices. That suggestion has been refuted in many articles and speeches.

The immoral and expensive practice of building up surpluses in the Common Market is shown to be the economics of anarchy. No one can persuade me that selling butter to the Soviet Union was other than the economics of stupidity. We sold 200,000 tons of butter to the Russians at 8p per pound. The cost of producing the buttter was £174 million the cost to the Russians was £33 million; the subsidy we gave to Russia was £140 million. We gave it as members of the EEC.

Mr. Buchanan

Détente.

Mr. McBride

My hon. Friend says, "Détente", calling in aid a sense of rapprochement. That is a most expensive way of saying, "Hullo, good neighbour". We were required to pay £12 million as part of that subsidy, although we had no say in it.

No morality exists in the EEC method of purchasing stocks, particularly stocks of beef. At this moment the EEC holds stocks in refrigerated stores to be released when the price is high enough, while old-age pensioners in my constituency, proud and independent people, look at beef and the memory of a beef meal with regretful recollection. They are no longer eating bacon and eggs. Anyone visiting other Common Market countries is struck by the great differences in prices, and so on, compared with those in this country.

We are exploring for oil in the Celtic Sea, which washes the Welsh coasts. If North Sea oil is important to the future economy of Scotland, the oil-rich potential of the areas around the Welsh coast will be of great importance to Wales. In the Principality, we view with apprehension efforts emanating from Brussels, with the backing of French and German industrialists, to secure a free-for all in the oil-rich sea areas around our coasts. The Government must protect these areas, including Wales, and must veto the oil-grabbing proposals that have the backing of the Community.

It is important to the Principality that we should develop this potential and retain all the revenues accruing from any oil discovered, certainly in the second city of Wales, part of which I represent. In the dock area, we are prepared and willing to service the exploratory expeditions and we shall defend our right to do so against all others, whether it be a single Community country or as a combination of countries. We are opposed to European firms sharing in the profits from that area.

Mr. Buchanan

America, too.

Mr. McBride

The British Government should be rigidly firm in seeing that oil profits are secured against interference from any country. We should oppose any suggestion from the Community that it would report the British Government for supporting a British-based competitor. The Community would go so far, if it had its way, as to report such support to the European Commission and subse- quently prosecuting the transgressor in the European Court. There can be no conflict of interest here, and our country must come first.

In Swansea, we are well-equipped with firms which will make their services available to the oil exploration interest. The European Commission has no power to decide the destiny of the riches lying below the seas around the United Kingdom, particularly any discoveries in the Celtic Sea.

I believe the lack of accountability of the Commission causes resentment to grow daily in our country. I wish that those who believe firmly in a customs union—and everyone knows that I do not—are looking at things in a false perspective. They are like people in an economic desert walking towards a mirage.

In debates on this matter in the House, it was said that our country would be reduced from a nation to a province. If things go on as they are, it will be reduced to being a mere constituency with no influence whatsoever, with a sham parliament and a charade of playacting at Strasbourg. I say that, knowing that the hon. Member for Galloway is a member of the European Parliament.

The Prime Minister has clearly a duty to this country. The British people, free proud, resourceful, have the right to make their independent decision in relation to renegotiation of the terms of entry into the Common Market—and that the majority of the British people are against those terms is an open secret. In Wales the ratio is four to one.

Therefore, the paragraph in the Gracious Speech relating to our policy in Europe is the essence of ambiguity and is no justification for our continuance in the Community in which final decisions should be made by the freely expressed will of the British people.

5.50 p.m.

Mr. John Brewis (Galloway)

The hon. Member for Swansea, East (Mr. McBride) speaks as a genuine anti-Marketeer and one cannot help but enjoy his speech, though I have heard it once or twice before. In some ways his speech is old-fashioned because, in talking about renegotiating the common agricultural policy clearly he is trying to get cheaper food for his constituents. But today there is no cheap food in the world. World prices are now higher than the Common Market prices, so he will not get much succour there.

I was also surprised about what the hon. Gentleman said about Mr. George Thomson, who has been working on the European regional policy. Among other things, Mr. Thomson is seeking to get aid for areas of industrial decline, including areas of Scotland and Wales. The hon. Member praises the Italians and the Irish for going against that policy but the effect will be less money for the industrial areas of Scotland and Wales. I think he is wrong on both those points. I wish that some of the 18-year-olds mentioned by my hon. Friend the Member for Leek (Mr. Knox) could have heard the hon. Member's speech, which was full of suspicion and chauvinism and not much co-operation with his neighbours.

The Gracious Speech deals with the European Community but no mention is made of the hill farming directive, which is very important to both the hon. Member for Swansea, East's countries—Wales and Scotland.

I wish only to speak briefly on a sentence near the end of the Gracious Speech which says: My Ministers will continue to take action to ensure an efficient and soundly based agricultural industry. In the past, the Government have expressed a desire for agricultural expansion and I am sorry that that word does not figure in the Gracious Speech. In the context of our contribution to the European agricultural fund—I am sure the hon. Gentleman will agree with me—expansion of agriculture is essential if our contribution is to be kept down. Therefore I should like an assurance that there is no change in the Government's agricultural policy.

Undoubtedly, during the past year, much of British agriculture has enjoyed a very good year, particularly the cereal growers in such areas as East Anglia, but for livestock producers, matters have not been so good. Only yesterday I tried to buy barley and was quoted £54.50 a ton compared with less than half that figure this time last year. Feedingstuff costs for the farming industry have risen by a massive £400 million already. At the last Price Review a comparatively small increase was forecast in the milk price because it was anticipated that calf prices would increase and that dairy farmers would get a little more in that way. It was expected—quite wrongly—that feedingstuff costs would decline.

Events have gone in exactly the opposite way. Dairy compound rations last year were £42 a ton; this year they are up to £66.80. That is by the Ministry of Agriculture's own reckoning, which is probably on the conservative side. It was thought that milk yields would advance but, of course, we had a very dry summer. It was thought, too, that the price of culled cows would rise, but that has not happened.

To keep up producers' margins—and, broadly speaking, stage 3 of the Prices and Pay Code does not intend to squeeze margins so as to jeopardise investment—it would be necessary for farmers to get about 3p more a gallon. But my right hon. Friends the Prime Minister and the Chancellor are anxious that the price of milk should not increase. It would need to go up by about ½p a pint. But I do not think this would have a very serious effect upon the housewife.

Mr. Ted Leadbitter (The Hartlepools)

The hon. Member is interested in the cost of feedstuff for livestock. Is he not aware that the National Farmers' Union recently made firm and strong representations personally to the Prime Minister? Is he not further aware, since he said that the Prime Minister is anxious that milk prices should not rise, that the Prime Minister rebuffed the National Farmers' Union, that the Prime Minister has rejected its arguments, and that the Prime Minister has not even raised a finger in another respect of production arising out of feedstock costs—the fact that over 8,000 egg producers have gone out of business in the past year?

Mr. Brewis

What the hon. Member said is approximately true. The Prime Minister has asked the NFU to wait until the Price Review in February on the ground that the past two years had been good ones.

However, I do not entirely agree with my right hon. Friend's reasoning. A great number of egg producers have gone out of business in the last few years, largely because of concentrations into larger units.

Mr. Leadbitter

The hon. Member mentioned awaiting the Price Review in February next year. But is he not further aware that the National Farmers' Union, because of the urgency of the matter—the crisis, as it sees it—has asked for an interim price review? Having regard to that situation, does he not consider that his assertions about the Prime Minister's concern cannot have any validity whatsoever?

Mr. Brewis

I had better proceed and make my speech in my own way.

In my constituency, particularly the county of Wigtownshire, farmers are going out of milk production. About 8 per cent. of the dairy farmers in Wigtownshire have decided to give up milk, and this amounts to about 1,500 or 2,000 cows being put off.

When people opt out of milk farming, they do not readily come back to it. Herds are built up over many years; it is a seven days a week job. They tend to take up some other kind of farming. With pig farming or even poultry farming, it is fairly easy to go out and come back again. But not so with dairy farming.

I should like to emphasise the effect on employment. In my constituency, I have one of the biggest and most modern creameries in Europe. I do not think the operation of that creamery will be affected, but it is always the smaller, older, creamery in the remoter village which is closed through a shortage of milk. That raises a considerable unemployment problem, particularly for men made redundant where jobs are not easy to find. It should be stressed that it is most important for such rural areas that we keep up the supply of milk.

There is a proposal by Mr. Lardinois that, in the reorganisation of the common agricultural policy, there should be a cut in price of milk if more than 8,000 litres are produced by one establishment in a year. I hope the Government will oppose that proposal because it discourages investment in the larger and more efficient dairy units.

As feedingstuff prices have already reached the full Common Market level, one step up in the transitional period steps at the February Price Review is not enough. I hope, therefore, that the Government will be able to give some in- formation of ways in which we can move to later steps in the transitional period.

6.0 p.m.

Mr. Dick Douglas (Clackmannan and East Stirlingshire)

It is not my intention to follow the expert remarks of the hon. Member for Galloway (Mr. Brewis) on the agricultural situation, save to say that farmers in my constituency and those of my hon. Friends the Members for West Stirlingshire (Mr. Baxter) and Stirling and Falkirk Burghs (Mr. Ewing) have made representations about the present position, which is causing difficulty, especially to the milk and pig producers. No doubt farmers throughout the country will wish to see some amelioration in the hardships for milk producers that they are likely to experience in the coming winter when the grass is short.

It will be no surprise to the House to know that my main remarks relating to the Queen's Speech deal with the following sentence: Measures relating to the extraction of petroleum from the United Kingdom Continental Shelf will be laid before you. The experience of the United Kingdom in relation to the exploration and eventual exploitation of the Continental Shelf has been the subject of my attention since I became a Member of Parliament.

I think that the Prime Minister was a trifle optimistic in his assessment that the supply of oil would be assured next year. We shall be lucky to get oil—particularly from the Forties field—by the end of 1974. The engineering difficulties there are extremely onerous and are pushing at the frontiers of petroleum technology. Oil may be taken from the smaller fields, but we shall be lucky to obtain it from the major fields, such as the Forties and Brent.

Relationships with oil companies are of considerable interest to Scottish people as well as to the people of Wales, as my hon. Friend the Member for Swansea, East (Mr. McBride) pointed out. That is not to say that people in England and Ireland are not also interested in the exploration and exploitation of oil from the Continental Shelf.

The resources of the Continental Shelf are much larger than the Government expected, though they continue to stick rigorously to a figure of 100 million tons per annum by 1980. No other responsible expert adheres to that figure. In the mid-'80s we fully expect to get 150 million tons per annum. In very rough terms, that would be equal to our expected requirements.

I should like to deal with the effects of the Middle East war and the breaking of the agreement by the OPEC countries on the oil price structure. When I wrote about oil in February, I said that the five-dollar barrel was a long way away: it is not; it is with us now, and hon. Members who follow these matters will not be surprised.

It is not without the realms of reasonable expectation roughly to calculate that the £16 ton is within sight. Some of my hon. Friends say that the Arab nations have a right to exploit this natural resource, but I feel that if one signs an international agreement one expects to get not only a good deal but a deal that will be kept.

I deplore the behaviour of the OPEC countries, which think that unilaterally they can top up the price for oil. I hope that they get a fair price, but they should be mindful that the economy, particularly of Western Europe, will be in jeopardy if we continue this way and they in unilateral fashion keep hoisting the price of oil. But that is a matter to be laid aside at the moment. Our own licence structure for the North Sea means that if one has a £16 ton, at the present royalty of 12½ per cent. the Government will receive £300 million.

We were told in the Gracious Speech that certain measures would be laid before us. There was no explanation of the tax division, but I refer the House to the publication of the report of the Public Accounts Committee. I am taking a conservative view of the situation, and the reasonable expectation, if we get the tax structure right, is that the tax revenues, based on a 50 per cent. corporation tax, would yield £900 million per annum in the mid 1980s; giving a total from revenues of £1,200 million.

I am taking a selfish view and believe that all this money should be spent adjusting the regional imbalance, particularly in the Scottish economy. The Government should go further. It is noticeable that there is a softening of attitude towards a barrellage tax as proposed by the Public Accounts Committee. The oil companies recognise that the new price structure for the Middle East gives untold potentiality to make profit. This is a windfall situation for the Government and the oil companies. The Government should be pondering the possibility of introducing a barrellage tax which relates to the size of the field for existing licences. I hope that the Government will shortly lay proposals before the House for the new round of licences, with considerable tightening up.

I have taken a stand on nationalisation which is not the same as the policy of my party, as I understand it. One hon. Member this afternoon tried to make great play with that. In 1964, the Tories undertook the greatest piece of nationalisation ever by the Continental Shelf Act. They nationalised these resources. If my party is thinking of a greater degree of public participation, I will support it, but to argue that every oil company granted or likely to be granted a licence should be nationalised is a proposition that I do not understand or appreciate.

I appreciate a desire to claim a carried interest agreement up to 50 per cent. and to argue for strenuous licensing terms, particularly with reference to what happens to the oil once it is brought ashore. The licences given under both Governments argue that the oil should be brought ashore to the United Kingdom, but there is nothing in the present round of licensing agreements to compel the companies to process that oil in the United Kingdom or to seek permission to do otherwise. This factor is extremely important to the future build-up of the industrial fabric of Scotland and other development areas of the United Kingdom.

I should like to see very stringent measures imposed in the next round of licensing, to ensure that once the oil is brought ashore it is processed in the United Kingdom. I have observations to make about the way the Government are handling these matters administratively. I make no personal criticism of the people involved, either Mr. Gibson or Lord Polwarth. I do not criticise personalities and I am not dealing in the counterfeit coin of personality. I am concerned with the structure agreed by the Government to ensure that we get the maximum benefit from the North Sea finds.

The Government commissioned a very costly report by the International Management and Engineering Group which said that a petroleum supply industries board should be created. The Government did not implement that proposal and have therefore denied themselves an instrument which would enable them to anticipate events. The Government have continuously run behind events on North Sea oil. When a situation such as the energy crisis, accelerated by the Middle East conflict, arises the Government find themselves struggling to accelerate the process but they lack a viable instrument with which to do so. As I suggested last week to the right hon. Gentleman the Secretary of State for Trade and Industry when he made his statement on oil supplies, even at this late date the Government should revamp their administrative machinery to try to create a structure which would enable them to anticipate events.

It is extremely important for the United Kingdom economy and for Scottish industry in particular to secure a maximum share of the building programme of production platforms and oil rigs for the North Sea. Strong conservationist arguments arise for Scotland, arguments which I as a member of the National Trust for Scotland, fully appreciate. I accept the stand taken by the Trust over Drumbuie and Ullapool. These are important areas which must be conserved. However, there must be a balanced approach. The oil companies must be able to chose from a variety of production platform designs. Although we might get a share of the auxilliary equipment programme it is much more difficult for British industry to secure the orders for major equipment if the basic large orders of £20 million to £30 million go abroad. We have just lost orders for two platforms to Norway. It is a crying shame that at a time of world shortage of drilling rig production facilities only one major United Kingdom company—Marathon—is able to build them.

I accept the conservationist argument but the onus for preserving and conserving the land must reside in the State.

There are many devices for conserving the land when drilling rigs and production platforms are built but involving the State in the obligation to restore land is the best form of protection. That is why I deplore the Government's cavalier attitude towards the important Bill which emanated from the Shetland County Council.

The Scottish economy is poised for a period of development and growth. There have been a number of substantial reports on the Scottish economy, one emanating from the Scottish Council for Development and Industry and another from the Economist. Broadly speaking I support the views expressed in those documents. If we are to get the benefits from the North Sea pressure must be exerted for a maximum gain in terms of employment and production based on the West of Scotland. The West of Scotland presents particular difficulties. These matters have been highlighted elsewhere but it is important, particularly in view of the criticism of the regional policy in embryo of the Common Market by my hon. Friend the Member for Swansea, West (Mr. Alan Williams), to make this point. The Economist on 29th September said: Here the claims of the West of Scotland are particularly strong. It is estimated that jobs lost by the continuing decline of existing industries will, on present performance, exceed 200,000 by 1981 and 400,000 by 1991. The severity of the West's plight can be illustrated by comparing this estimated loss of jobs with similar estimates elsewhere in Europe. It is reckoned, for example, that in the next ten years the declining regions of France will need 150.000 new jobs, while the equivalent needs of Italy, Belgium and Holland are 100,000, 120,000 and 80,000 jobs respectively. It is essential that attention should be paid to the needs created by declining industries in the West of Scotland. In particular the Government in the Gracious Speech should have given a firm commitment to continue with the regional employment premium. That is an extremely important labour-intensive device for areas like the West of Scotland. It is important that we see regional policy and energy policy in European terms. I do not accept the views expressed by some of my hon. Friends that we can be self-sufficient for our energy requirements in the mid-1980s because of the North Sea finds, and disregard what is likely to happen in Europe. It would not benefit the United Kingdom if we were to be self-sufficient and Europe were to be starving. That would be the economics of Bedlam and chauvinism writ large. I do not accept that. I would argue for an energy policy, in international terms, which tries to unite the needs of the consuming nations, including the United States and Japan, with the requirements of the producing nations to get a fair return for the wealth we possess.

6.18 p.m.

Mr. David Madel (Bedfordshire, South)

I shall take up points raised by the hon. Member for East Stirlingshire (Mr. Douglas) later in my speech when I deal with oil and the difficulties facing this country. I am not a Member from north of the border. My constituency manufactures cars and trucks in large measure and therefore my approach is slightly different from his.

Inevitably the international situation and the tension in the Middle East over-shadows this Gracious Speech in a way that international events did not overshadow previous speeches of this parliamentary term. I welcome what my right hon. Friend the Prime Minister said about this country being committed to action through the United Nations to try to bring about a permanent cease-fire and a permanent peace in the Middle East. I hope that we shall treat the three disputed frontiers of Israel separately because to treat them as one problem at one peace conference leads inevitably to severe difficulties.

I have always believed that there will not be lasting peace in the Middle East until as a first step there is agreement between Israel and Egypt. Egypt, the largest and most powerful Arab State, still possesses the greatest influence in the Middle East. Until agreement is reached between Israel and Egypt it is useless to try to talk about Jerusalem, the West Bank and the Golan Heights. I should like to see a United Nations force stationed in a demilitarised zone somewhere in Sinai—and we appear to be moving towards that—which will give something to Israel and Egypt. Until they both get something there will not be a lasting peace. For Egypt the primary need is the reopening of the Suez Canal with the consequent revenues.

Egypt needs to see the development of the waterway which plays an important commercial role for countries of Western Europe and those surrounding Egypt. If the Egyptians can reopen the Suez Canal and if Israel withdraws partially into the Sinai desert that will help to ease the atmosphere. For Israel, security is the main anxiety and desire. I believe it is possible for Israel to feel secure with a different boundary with Egypt from the one which she had between 1967 and 1970.

I welcome what this country has done in providing RAF transport to get United Nations troops from Cyprus to the area where there has been fighting. There should be a demilitarised zone in the Sinai desert, after which it will be possible to tackle the more difficult problems of the Golan Heights and the West Bank. Last, but by no means least—in fact it is the most difficult problem—is finding a solution to the problem of Jerusalem.

First, there has to be agreement between Israel and Egypt. Each side must feel secure. I am sure the Government are doing the right thing in working through the United Nations.

I was delighted to hear the Prime Minister's assurance that he has heard from the Arab oil-producing States that they have no wish to damage this country. I hope that that will continue to be the case. Petrol and oil rationing would have a very deleterious effect on the car and truck industry.

There has been a big up-turn in investment and a big increase in production this year, and a promise of further investment, in the car and truck industry. We have never had a better opportunity for exports than we have now. All of this would be in jeopardy if there were oil and petrol rationing.

If the worst comes to the worst and oil and petrol rationing is introduced, I hope that great attention will be paid to people in rural areas. When there was petrol rationing last in 1956, bus and train services were much more extensive than they are today. If petrol rationing is introduced now it will cause hardship. I speak as one who represents not only an industrial area but a rural area. I believe that favoured-nation treatment will be needed for rural areas if there is to be rationing.

I particularly welcome two proposals in the Gracious Speech. We are told that a Green Paper will be published containing proposals for promoting a greater degree of employee participation in industry. As a representative of a car manufacturing area, I hope to see a new permanent conciliation commission which can be used to sort out industrial disputes in the car industry. We had a full debate in June on the problems of the car industry. In the summer months there was not the industrial peace we had all hoped for in the car industry.

In my constituency both Vauxhall and Chrysler have had difficulties. We have to have a fall-back position, with a body to which both sides can go if they are in difficulties. In 1969 the right hon. Member for Blackburn (Mrs. Castle), when Secretary of State for Employment, set up the Motor Council, which has hardly been used in trying to solve industrial disputes in the industry.

A three-man commission is needed. It could comprise, first, a representative from the shop floor, who knows the car industry, has worked a considerable time in it, and understands all the difficulties and stresses of the industry; secondly, a representative from a trade union, not necessarily connected with the motor industry, but a national official; and, thirdly, someone from management, from outside the car industry. The composition could be modified, but a body is needed to which both sides can automatically go if industrial difficulties arise. We must get away from the siege warfare of the past few months.

I also welcome the part of the Speech which states that legislation will be introduced for better provision for the safety and health of workers. The hon. Member for Doncaster (Mr. Harold Walker), who is present, has strenuously advocated such legislation. I hope that his hopes and desires are realised this year. I have spoken on the subject, and hope for a Bill which contains provision relating to mental health in industry and which will deal particularly with difficulties experienced by people working on the shop floor. The problems of mental health in industry have hitherto been almost unrecognised. The Gracious Speech does not say what the Bill will contain but I hope it will contain provision for improving the mental health of people at work.

I welcome the proposals for improving road safety. I have long advocated that greater attention should be paid to village speed limits. There are far too many villages whose roads cannot take the flow of traffic with a 40 m.p.h. limit. An expert has said that the limit should be 20 m.p.h. in certain villages, and I do not quarrel with that. In my constituency there are three or four villages where a limit of 20 m.p.h. would be just about right.

I welcome the greater flexibility in the provision of rural transport, in which there must be a big improvement. We hope to see it this year. In connection with that, I look forward to the announcement by my right hon. Friend the Secretary of State for Education and Science, which I think will come before the end of this calendar year, that the working party looking into the problem of school transport will report soon. We hope that there will be time in the Government's legislative year to change the existing rules and regulations on the provision of school buses, which have become out of date, especially when counties have gone comprehensive, as Bedfordshire has. A whole series of new problems in school transport results, and we hope for action this year.

Obviously, in the forthcoming parliamentary year, as in previous years, industrial relations will dominate the scene. I hope that whenever they have an industrial dispute on their hands personnel directors and labour relations directors will refrain from saying in radio, newspaper or television interviews that unless people go back to work, investment will be drastically cut or the factory will be closed. We can do without that kind of talk.

In its present difficulties the Vauxhall management so far has given the country an object lesson in keeping cool and quiet in public and negotiating vigorously behind the scenes. I hope that other companies will follow suit. In the past parliamentary year there were far too many excitable statements by labour relations directors which did nothing to improve the situation and, if anything, made it worse.

Stage 3, with its flexibility clauses and unsocial hours payments, will. I hope, pave the way for better industrial relations this year, but there is a special responsibility on management, which I hope it will accept in the forthcoming year.

6.33 p.m.

Mr. Ted Leadbitter (The Hartlepools)

All hon. Members must be deeply concerned about the passage in the Gracious Speech which speaks of the Government continuing to work for a just and lasting peace in the Middle East. For our separate and collective reasons we are bound to ask questions about that, not because "just" carries with it all sorts of difficulties, and not because "lasting" seems to be a near impossibility in the light of history—though we pray that it will not prove to be so—but because the Government's recent activities have created a big doubt about what other countries will think of the United Kingdom.

We supply weapons, including tanks, to a sovereign State and a member of the United Nations, but, at the very moment when that State needs to use them to preserve her people's liberties and boundaries we say that the contract comes to an end. We say, "We will not give you the means of using those weapons." It is not a question of being pro-Israeli or pro-Arab. It is a question of a contract. The Government's authority has been considerably lessened, and the great opportunity to have some say about future Middle East matters has been eroded, because we have been found wanting in the matter of honouring a contract.

We have received a snub from President Nixon. It would be wrong to take the tempting opportunity arising from American domestic affairs to be overcritical or to over-dramatise the situation, but such a snub is not tolerable to the British Parliament. American bases in this country were put on what has been described as a low-profile alert. Whether or not the diplomatic explanations are acceptable, the interests of the British people are not fully protected if, as it appears, one of the super-Powers can adopt a near-operational posture on bases here without our being consulted or treated properly.

Whether our attitude to the Middle East contributed to the lack of consultation is a matter of conjecture, but it is a factor in our foreign policy, much of which has fallen far short of the moral lead that we should give. The United Kingdom will never be able to give a lead, to give the world all the benefits of its experience, or to create confidence in sensitive areas, if we do not keep our word and have the guts to say what is right.

Let us be less sensitive to the niceties of diplomatic language. It is the job of a politician to say in Parliament what he feels is the truth. The argument is not whether he is right or wrong but whether he should be deprived of the right to say what he feels. Parliament has been neglected in the Middle East affair. I should like the Government to keep more to their word, and then they might well have the opportunity to work towards a lasting peace.

On domestic matters, the Government talk about working to secure a prosperous, fair and orderly society; to maintain their policies for promoting employment". I am somewhat cynical, because ever since the end of the war we have been talking about working towards a prosperous, fair and orderly society and promoting employment. With all the surfeit of regulations, added to which there is now the mountain of regulations from the Common Market, we are worse off today than when we had the Ten Commandments. The people feel a great doubt about such language, though it sounds nice, and in the agreeable traditions of this House and the other place. Certainly we do not want political diatribes, even if we want reforms of procedures in starting a new Session in Parliament. Once we start a debate on the Gracious Speech we ask, "Are these words the words which we mean?".

I have a constituency point. It is not unrelated to similar problems in other parts of the United Kingdom, in South Wales, Flintshire, Scotland and generally in the North-East whence I come. I refer to the Government's White Paper "Steel, British Steel Corporation: Ten Year Development Strategy". I represent a seat with the most modern steel plant in all Europe. During the past 12 years it has had an investment programme of £100 million with, as recently as five years ago, two modern pipemaking mills employing some 4,500 men at the moment. That is to be closed.

It will take greater men than Lord Balogh, who has made more economic mistakes than any other economist I can think of, or any other economic pundit from whatever economic school, and it would take the highest professional abilities in the steel industry itself, to convince reasonable men, or the skilled men in the industries I am talking about, that there is any common sense in closing down a relatively modern steel plant with 4,500 men into which in just over a decade we have poured £100 million. It does not bear examination. But there it is.

How does this arise? The Government have never been frank on the subject of steel closures in the United Kingdom. Why? All the projected figures of supply and demand of steel throughout the world show that over the next 15 years steel requirements will treble. Steel supply will approach two and a half times the present levels, while still falling marginally short of world demand.

Who is taking advantage of this careful forecasting? Japan is increasing her production by 28 million tons; America is increasing hers by 25 million tons; Germany is increasing hers, by 1975, by about 9 million tons; and France is increasing hers by 8 million tons by the same year. The United Kingdom, however, has been waffling for two years in the most unholy argument between the Government and the late Lord Melchett in an attempt to produce 26 million tons at the lower end of our production target and 36 million tons at the higher end. After a debate in the House on the subject, that was corrected to between 25 million and 37 million tons, getting nowhere near the capacity of the United Kingdom to expand its production.

The answer is not hard to find. It is in the Common Market, because we know, and the country now knows, that the Government are hesitant about admitting that Brussels says that the Secretary of State for Trade and Industry shall have no executive powers over the steel industry. More than that, it says to the British Steel Corporation, "You are no longer masters in your own house. You will not decide the shape, the size and the production targets of the British steel industry." More than that, it says, "Her Majesty's Government will not be allowed to subsidise a steel industry such as that based on The Hartlepools. When we get round to agreeing"—and that will take a very long time, bearing in mind the fight which has been going on now for more than two years—"we shall apply a readaption subsidy system." That means that workers in the steel plant based in my constituency have to face the threat of being thrown out of their jobs in 1975, with the hope of financial support to the tune of 90 per cent. of the current level of earnings. In exchange for that they will be on the scrapheap.

Anyone who has studied steel, the industry, its techniques of production, its investment policies, the demand side or the supply side will arrive at only one conclusion. Ever since the growing, bursting days of Bessemer this has been recognised as a fluctuating industry in which it was fatal to make the mistake of reaching final and rigid conclusions about closures and programmes. We must have a capacity for steel production which can take up the expansion in world demand and take advantage of new markets.

Over the past two or three years we have seen the disgraceful situation of the tube mills in my constituency being silenced, at a time when the British Gas Council has been seeking large supplies of pipes to distribute the benefits of North Sea exploration for gas. Instead of the British Steel Corporation supplying those pipes they have been bought from Italy and Germany—anywhere but from the United Kingdom. It will take a Minister with a great deal of courage to tell the hon. Member for The Hartlepools that a British steel worker cannot produce steel pipes of better quality and at a more competitive price than the Germans and the Italians or, in the case of Ekofisk pipes, the Japanese. No one in this country will believe that there is any economic advantage in that, especially when British steel is being shipped to the Common Market where it is turned round and shipped from another port back to the United Kingdom. We are buying our own steel, sometimes at 50 per cent. more than the price for which we produced it and sent it on its sad journey.

The other day I tabled a Question about a number of different steel production types. Taking the BSC's steel prices at 100, there is a 77 per cent. increase in price at the highest level in one product in the Common Market over the British price and a 40 per cent. increase at the lower level in another product over the British price. What is more, next weekend the British Government are to lift the price of steel as the first step of at least another two which are to come, not because we are operating on market forces but because we are operating on Common Market agreements.

I must tell the Government that when I fight for my men in The Hartlepools it is not just a matter of demonstrations, of representations, of coming to a Ministry, having a cup of coffee and a couple of biscuits, shaking hands and saying, "Goodbye". There will be harnessed the most professional brief possible, in order to convince Ministers who, at the end of the day, are fair and reasonable human beings. Once they are plucked away momentarily from the system inside Whitehall, as reasonable men they can see the force of a good argument when it is put to them.

Therefore, considering that part of the Gracious Speech which refers to employment, I take this opportunity to say that I believe that the Government ought to listen at least to one fundamental argument which should appeal to them. Since the publication of the recent steel policy White Paper, the devaluation of the pound has been such that every argument based on considerations of the purchasing power of the pound has made the White Paper out of date already. A review is needed, and I ask the Government to consider a review of their policies if only because they have a duty to the communities involved, quite apart from the consequences for suppliers and other of closures of this kind.

When the Government talk of helping the poor, the needy and the lower paid they cannot hide behind the facts of life. Property speculators have had a bonanza. The larger industries in the United Kingdom have made increased profits to the tune of 37 per cent. in the past year. The banks are reeking with profits that they have never known before. The division between affluence and poverty are so great that, although the Government's concern may be real, during the coming year, in which, no doubt, a General Election posture will be adopted, it is essential for the Government to stop playing with the poor, the needy, the lower paid and the old-age pensioner. They must not be pawns in the political game in the run up to a General Election.

I come now to prices. In an intervention earlier I referred to the way in which 8,000 egg producers went out of production last year. I referred to the representations made by the National Farmers' Union. For those who are not versed in these matters, that body represents the employers in the industry. The Prime Minister has rebutted the NFU case, but I have in my possession a report on beef prices. It is an authoritative report. It says that between June 1970 and May 1973 the price of beef chuck went up by 71.1 per cent., that of sirloin by 67.2 per cent., that of silverside by 59.4 per cent., that of back ribs by 73.5 per cent., that of fore-ribs by 70 per cent., that of brisket by 96.7 per cent. and that of rump steak by 54.7 per cent. I need say no more. Whatever the Prime Minister may say about his interpretation of dealing with prices "at a stroke", no matter whether he seeks to put forward a thousand interpretations of it—even if he made no promise at all—any Government with that kind of record in such a short time must be thoroughly ashamed. If they are not, they are totally insensitive.

Finally on prices, the report says this about bacon: The percentage increases of various cuts of bacon from July 1970 to 1973 have been: collar, 65.3 per cent.; gammon, 55.7 per cent.; middle cut smoked, 61.7 per cent.; back smoked, 65.2 per cent.; back unsmoked, 67.2 per cent.; streaky smoked, 83.6 per cent., I hardly dare mention the prices of eggs.

Therefore, after these years of promise from the Prime Minister and his party we have not reached a point where we can be happy about the state of the nation, our posture abroad or our record at home. It is no good counting the number of refrigerators, the number of telephones, the number of motor cars, and all the things which might provide some glitter while the leader of one party seeks to make a point over the leader of another party. That is not the play. The play is that there are thousands outside these walls who are worse off today relative to the generality of those who have received benefits in abundance, to such an extent that the gap between rich and poor has widened.

I say to Ministers and hon. Members who do not like what I say that I get no pleasure out of being in a House of Commons where I see commendable men and women, people whom I will not criticise, who can live in a society in which, when they leave here, they can get into limousines, live in the best hotels, enjoy all the fruits and benefits of good living, and spend on one meal in the House of Commons more than is given to old-age pensioners for rent, light, heating, insurance, leisure, for a full week. There is something fundamentally wrong in a society that asks us to tolerate that situation.

We now have men who are paid £37,000 a year and who receive increases of £350 a week because they are on a commission basis. They are people living on the fat of the land. Those who created the wealth live in dire poverty.

The Gracious Speech will mean something if by the time we reach the climax of an election the Government can claim that they have at the last minute changed their hearts. They won the last election on a cruel promise—to say the least—about prices, but I hope that they will understand that the electorate will not return them on another promise, but only on a record. Next year that record will have to be different from what it has been in the past three years.

Further, in constituencies such as mine the Government will have to uphold the fundamental right of a human being in a modern society not to have his work taken from him purely because M. Pompidou wants to rule the roost in Europe.

6.54 p.m.

Mrs. Jill Knight (Birmingham, Edgbaston)

To the casual and naive observer of the parliamentary scene it must seem very strange that, invariably, the Gracious Speech is viewed from one side of the House as appalling and from the other side as admirable—from one side as execrable and from the other side as excellent. Today has been no exception.

If we view the Gracious Speech as a cake, from one side of the Chamber it would appear that this cake is half-baked, with a lamentable paucity of currants and precious little icing. Only three or four steps—the famous two-and-a-half sword widths—away the cake appears appetising, nutritious, and full of Eastern promise. Hon Members will understand that from where I sit it looks to be a very good cake indeed.

I think that the Gracious Speech is imaginative and vigorous. I could, if I wished my speech to be as lengthy as some speeches this afternoon have already been, comment at some length on various points in the Gracious Speech which I think are first-class.

I will make one reference only and utter one word of congratulation, namely, on this passage— My Government will again review retirement and public service pensions and related benefits. There is a measure of hypocrisy in the speeches made by hon. Members opposite when they speak of the position of pensioners today. One thing that stands out very clearly about this Government's record is that those who are least able to bear the effects of inflation have been shielded against it. The Labour Government did not bring in an annual review of pensions to ensure that old people were protected from the cost of inflation. I welcome the indication in the Gracious Speech that the Government will again take this action.

I want to speak on the subject of house prices. It is a problem that worries me greatly. I could talk about the reason why house prices have risen so much. It would not be out of place to mention that house prices in Britain have, after all, caught up with the price of houses in every other section of the civilised world. For many years our houses were the cheapest in the world. This happy state of affairs could not possibly have continued.

Apart from the fact that house prices all over the world are high and have been high for many years, I do not think that anybody who is realistic and truthful can wonder that the price of houses rises when we face a situation in which bricklayers are earning—or, should I say, are being paid—£100 a week.

Mr. Harold Walker (Doncaster)

Will the hon. Lady tell us what wages were paid to the bricklayers who, 100 years ago, built terrace houses in London which now sell for scores of thousands of pounds? In her interesting analysis, will she tell us what wage factor has caused such a rise that it is pouring many millions of pounds of profits into the pockets of property speculators in London and elsewhere?

Mrs. Knight

The hon. Member knows better than that. There is a very full answer to what he has said, but it would take a very long time indeed. He said that wages are very much higher today than they were, and the wage factor has a very great deal to do with this matter. Also, there is the difference in the cost of terrace houses when they were built and the cost today, and in the cost of repairs. It is no good the hon. Gentleman shaking his head. I live in a terrace house, so I know what I am talking about, but I am sure that he lives in very much better circumstances than that. However, I can assure him that the cost of repairs to old terrace property is very high indeed.

As I wish to be brief, I shall confine my remarks to the plight of people who wish to buy houses today and are not able to do so. I want to refer to the case of a young couple whose joint gross income is £54 a week, with take-home pay of £41 a week. Between them they have saved £200 towards the cost of the house which they hope to buy, but the estate agent tells them that with that amount of deposit and £41 a week take-home pay all they can hope for is a loan of between £4,600 and £5,600, so they must find a house costing under £6,000. They may have to look towards an older house because, broadly speaking, such a house is cheaper, but for an older house they can get a mortgage of only 80 per cent. Therefore, their £200 is not nearly enough and they will need £1,000 for even a relatively cheap older-type terrace house. The question is: should they look for something which is very cheap indeed, because it is in a bad condition? That is a possible way out for them. There are such houses in every town and city in this land. Unfortunately, the cost of improvements to these properties is such that it makes the young first-time buyer quail at the thought of them.

I know the Government's answer to the plight of these people and so far as it goes, it is a very reasonable answer. My hon. Friend the Under-Secretary of State for the Environment—the hon. Member for Birmingham, Hall Green (Mr. Eyre)—sent me a most carefully worded and sympathetic reply, for which I should like to express my gratitude, and said that home buyers already benefit substantially from tax relief on mortgage interest or from the mortgage option scheme. That is all very well if people can afford to buy their houses, but the present difficulty is that far too many people cannot afford to buy a house, so they look towards rented property. I must tell hon. Members of the Opposition that if they go on talking as they have been talking, about clobbering the private landlord there will be no private rented accomomdation at all.

Mr. Leadbitter

I am interested in what the hon. Lady is saying. She was so right about the case that she quoted. But is she not aware that building societies are telling young couples in that kind of wage bracket that they cannot have a mortgage on a £6,000 house unless they have £53 a week coming in? As regards rented accommodation, her hon. Friend on the Front Bench knows full well that we are building fewer council houses now than for many years, and he also knows that the reason is that the Government will not alter the unit cost yardstick, which has restricted the building of houses in my constituency for far too long.

Mrs. Knight

I should have known better than to give way to the hon. Gentleman. I am not talking about council houses; I am talking about people who wish to buy their own homes, and about the difficulty in which they find themselves. The couple about whom I am talking are not getting a bad income, yet they find themselves in difficulty. Of course, the Government are absolutely right to look at this as a matter of balance and to say that the purse is not bottomless, that we have other categories of housing need to take care of, that we have the homeless and the slum dwellers, and that we cannot think of helping one section of the population to the detriment of another, when such people are already in receipt of some help. Nevertheless, when the Government refer in the Gracious Speech to the housing policies which they will develop, I very much hope that they will understand that the desire to own a home is a fundamental wish of many thousands, if not millions, of people and it is a desire which they should encourage. I know that the Building Societies Association has advised member societies to give a high priority in lending to first-time purchasers, and I also know that the Government have been trying, but the people whom I have been describing have not so far been enabled to buy their own houses, and that worries me.

I should like to turn to the question of the older buyer of a house, who has been in a tied house all his working life, which is another category that worries me. There are many people in this country such as publicans and school bursars, who must live on the job and who, until two or three years ago, were confident that the money they had saved would be sufficient to buy them a bungalow when they retired. But they have been hopelessly overtaken by events and now they cannot look forward to doing that. I have had many letters from people all over the country—because I originally raised this matter in a Parliamentary Question—stressing that the need is even greater than I had thought, and that there is great worry in the minds of many thousands of people. Even local government employees, employees in children's homes, in old people's homes, in residential schools run by local authorities, and, indeed, by the Home Office, find themselves in an appalling situation, sometimes after many years of service. I have here a letter from the Honorary General Secretary of the Association of Hospital and Residential Care Officers, which states: My Association is concerned with persons in charge, and their deputies, of Aged Persons Homes provided by local authorities, and also all caring staff in Children's Homes. A recent survey of the Staff Side indicated that there was some 10,000 residential child care staff short throughout the country, and one of the contributory factors being that less and less people were likely to take up residential work because of the housing situation on retirement. We feel that unless these staffs (many of whom have given years of service) are secure themselves, how can they be expected to give a sense of security to those for whom they care? And we are fearful that if some solution is not found that the residential services will suffer as a whole, which in turn must have serious consequences on those for whom they care. I have another letter from the Cornwall County Council, which reads: I am writing to say how alarmed I am that the powers that be have not included in the Appointments of Residential Care Officers, the offer of a place to live in, upon reaching retirement age. My Deputy has been trying for the last 18 months to obtain a Flat from the Council, but so far she has been unsuccessful, when you think of this it is a poor State that cannot look after its servants, after so many long years of service. I would like the Government to be made aware of this position, so that arrangements can be made for Officers in Residential Care to be taken care of, with reference to housing, in the retirement years, as opposed to the alternative of a transfer into Part III accommodation, because our salaries will not be adequate enough for us to obtain a mortgage". It is quite clear that there is desperate need here. All too often, employees of local authorities, such as child care officers, have had to move about all over the country, with the result that when they reach retirement they have no residental qualifications and cannot go on the list of the council where they wish to live. Their sons and daughters may be living in a different part of the country, and it is not unnatural for them to wish to be near them, but they have no residential qualifications and cannot obtain council accommodation. This seems to me to be something that the Government might well include in their housing policies in the future.

My hon. Friend the Under-Secretary drew my attention to the Retirement Housing Association and the Guardian Housing Association, for those people with some money but not enough to enable them to buy their houses. There should be more generally disseminated information about these excellent housing associations. Perhaps the Government will think about that. In the Gracious Speech there is a reference to the voluntary housing associations. I am sure the Government mean to help these associations in every way, but will they also help the people who need these associations so much to learn a bit more about them?

There is at the moment a scheme which has been advanced by the Birmingham City Council—a partnership scheme with private builders, under which city nominees—and that part of it worries me—can perhaps get 100 per cent. corporation mortgages at a rate of 91½ per cent. interest. The idea is that one buys half a house and pays rent for the other half. Ministry sanction is awaited. I can understand that there is some delay because this is not a straightforward scheme. There are obvious difficulties. There could be certain fiscal difficulties. One can imagine this without elaborating on it. Presumably, after a short time the occupier of such a house would own only half of it and he could possibly be evicted. This does not seem to be the best of schemes, though it deserves to be looked at most carefully, and I have no doubt that the Government are doing this.

I beg the Government, in their consideration of housing matters, to think particularly of the young and the older buyers. Both these types of people desperately want to stand on their own feet and help themselves; they do not wish to be more of a call on the State than is absolutely necessary, and I hope we shall do something positive for them.

7.12 p.m.

Mr. William Baxter (West Stirlingshire)

A very pleasant duty befalls me, Mr. Deputy Speaker, and that is to extend to you my personal hearty congratulations, and I am sure the congratulations of the whole House, on your taking the Chair for the first time. I must say that you have shown immediately a fair amount of good sense and excellent judgment, and I hope you will continue to do so, in your selection of people whom you consider can make reasonable contributions to debate. This is much to be preferred to sitting for five and a half hours—waiting for you to take the Chair and to call upon one to speak. Congratulations. I hope that you will be long spared to serve in that capacity.

I must express some sorrow at the fact that a constituent of mine, the hon. Member for Renfrew, East (Miss Harvie Anderson), who occupied the position of Deputy Chairman for so long and who carried out her duties so excellently, has now vacated that position. Nevertheless I think that you are a worthy successor to her and I wish you well in the future.

There is no doubt that, when one reads the Gracious Speech, one can find many items worthy of comment and consideration, and not only items which are mentioned in the speech but many others which are outwith the speech. They all require some comment. It is extremely difficult to know where to start one's speech. Nevertheless, I feel that I must express my wholehearted concurrence with the third paragraph of the Gracious Speech in which the Government say that they will continue to work for a just and lasting peace in the Middle East". There can be no doubt about this simple fact of life, that this is indeed one of the priorities of the day. While the Foreign Secretary has been criticised for his policy of non-intervention and for not being prepared to sell armaments to the two combatants, the Arabs and the Israelis, a policy which I wholeheartedly endorse and which I supported in the Division Lobbies, in some small degree this is a factor contributory to bringing about a cease-fire. History will tell us more about it, but at least it did nothing to increase the tension, and, given the benefit of the doubt, it certainly helped to de-escalate a very difficult situation.

The question which arises in my mind is: if it was good—and, in my judgment, it was—to prohibit the sale of arms to the Israelis and the Arabs during a period of war and hostility, is it not much more sensible to continue the prohibition of the sale of arms to those countries in time of peace? If they do not get the arms in peace time they cannot use them if they feel like entering into another war.

I hope that the Government will be inspired to go forward another step along that desirable road of stopping as soon as possible in every country the trend of building up armaments, which can only bring the possibility—indeed, the certainty—of war and destruction.

It is said in the Gracious Speech that we have a special relationship with America. It has been said time and again that when the ultimatum was given by President Nixon this country, or the NATO alliance, was not consulted. That may or may not have been so. I know nothing about it. Nevertheless, this country was put into a very dangerous situation. If the ultimate had occurred, the destruction of our nation would have been a certainty.

I should like to have seen in the Gracious Speech a vigorous declaration that we would continue the policy of not providing arms in war or in peace and that we would demand the closure of the Polaris base in the Holy Loch. That would have been a step towards de-escalating this terrible possibility. I should like to see a declaration from somewhere or other that the Polaris fleet which we possess will be no more. We want nothing to do with it. It is not a peaceful force. It is a force of war and destruction. The Foreign Secretary should carry his policy to its logical conclusion and do away with the Polaris fleet.

A crime committed by the last Labour Government, and for which I will never forgive them, was the employment of an arms salesman. The first declaration which the present Government should have made in the Gracious Speech should have been that that man would be sacked immediately. He is no longer required if we do not support the sale of arms. As I said before, our policy is that we do not wish to sell arms in war time, and therefore we do not need to sell arms in peace time. Let Britain in future seek not to interfere, as it has done in the past, and as it is prone to doing now. Let Britain not interfere with everybody else's problems throughout the world. Interference with the affairs of other countries should not be taken lightly. We know that in this House there are men of various opinions and various strong convictions. However, we talk to one another and we are prepared to be reasonably friendly. Why should we take a different attitude in international affairs?

I should have liked to have seen in the Gracious Speech a ringing declaration that from henceforth we shall not interfere with what is taking place within the boundaries of another country with which we have little or no concern. I should have liked to have seen in the Gracious Speech an indication that expenditure on arms which has been continuing for so long would be cut considerably. I can see no reason for not cutting expenditure on arms to the average expenditure of the Common Market countries. If this nation is part of the Common Market set-up why should it carry a heavier burden than the other countries of the Common Market?

I can see no reason for vast sums being spent because of a posture, which is outdated and outmoded, of Britain's being a great international Power. Britain cannot be such a Power. It is sheer self-deception that we persuade ourselves that we are a great international Power. We must recognise the simple fact of life that we must live in the present and not in the past. The future is ours, but it can be ours only if Britain's great experience and great standing in the world are used for the advancement of peace among mankind.

The example of the right hon. Gentleman the Secretary of State for Foreign and Commonwealth Affairs should be taken to its logical conclusion. I hoped that that would be the ringing message from the first words of the Gracious Speech. Unfortunately, that is not so. The right hon. Gentleman the Prime Minister and my right hon. Friend the Leader of the Opposition lost a great opportunity to give a lead to the nation and to the world at the appropriate time in the history of man. Instead of that, they shilly-shallied and talked small town stuff like a couple of debaters in a school debating society. What a tragedy faces Britain when party leaders in this House, in the oldest Parliament in the world, speak in the way in which the Prime Minister and the Leader of the Opposition spoke today. They are not seemingly capable of giving a call to our people and to the world to go in another direction than that which we have pursued in the past.

What did we gather from the Prime Minister and the Leader of the Opposition about the domestic front? There is no doubt that Britain is living in a difficult and dangerous period. Despair and despondency are prevalent. There is a lack of confidence in the administration of our Parliamentary system of Government. There should have been a new concept born in the Gracious Speech—namely, the reorganisation of our parliamentary system of Government. If proof is required, let us cast our eyes around the empty benches. The futility of it depresses me and makes me afraid of the future.

There was a need, and there is a need now, for a new concept of parliamentary procedure. If that is not brought about I can forecast a great calamity for Britain. Our industrial and monetary systems are in jeopardy. Even our integrity is being questioned. That is happening in a time when Britain should be experiencing the most hopeful and satisfying period in its history. We have the potentialities and the opportunities, if only the will were there to grasp them. If that were done Britain could be a nation above all nations.

Alas, we do not seem to have the will or the gumption to go forward and to do what we should be doing. It is absolutely imperative—and although there is a reference to this matter in the Gracious Speech, it does not go far enough—that the safeguarding of our currency must be the Government's first consideration. Adequate steps must be taken to maintain and ultimately increase the value of the pound if Britain is to be the nation it should be.

I know that we are led to believe that to achieve such things is a complicated task. There are many partial answers to the problem and we are led to believe that a solution is difficult. The time is long overdue for a complete reappraisal of the international monetary system. Matters which should be pure and simple have become complicated by a mass of jargon and phraseology. Such language is difficult for people to comprehend. University professors have become lords of the land. They are given such honour because of the mystique of their phraseology and not because their ideas are sensible. By the time we have deciphered what their jargon means we are unable to find a solution to the problem.

We must recognise that the basic things of life are simple and easy to understand. The great moral laws which were laid down for man to follow are simple and easily understood by the most backward of us. The great thoughts of Mohammed and Confucius are not difficult for the simplest of us to understand if we have the opportunity to read them. The great industrialists and scientists of our age, and of previous ages and generations, were simple men who applied simple solutions to the problems which confronted them. It seems that today we are hidebound and troubled by the mystique of phraseology which hardly anyone can understand. A spade is now not a spade. It is called by a thousand different names which are difficult to comprehend.

The GATT agreement has troubled me for some time. There is nothing in the Gracious Speech to say that the General Agreement on Tariffs and Trade should be reconsidered. It is out-dated and outmoded. It was introduced at a time when Germany and Japan were backward and in difficulties after the war. By the GATT agreement they received preferences which are denied to countries such as Britain. If the GATT agreement is not reconsidered soon it could bring about almost a total destruction of British industries. Let us not forget that the last Labour Government introduced a tax system of grave inequalities to overcome the complications of GATT.

This Government have tried another method. The only method which will succeed is the renegotiation of the terms of the agreement because it contains prohibitions against our country which should not be tolerated a moment longer.

We have heard a lot today about the Common Market. I have always been against our entry to that unfortunate combination. That is not because I am against a combination of nations seeking to work out their economic and peaceful pursuits but because of the terms of the Treaty of Rome. We are only now beginning to realise its implications. I recognise, although some of my colleagues do not, that we cannot easily unscramble the egg once it has been scrambled. It will be well-nigh impossible to renegotiate the agreements into which we have entered as a nation.

Nevertheless the Government should have the courage at least to demand a suspension of some of the items which cause the greatest trouble. An item which takes about 90 per cent. of the budget of the Common Market is the agricultural policy. An effort should be made to suspend that, to give us a breathing space. That would serve as a holding action even though we might later have to meet our European commitments.

This was an opportune moment for the Government to make a declaration about a change in their policies. Some years ago I advocated in this House an export-import council or commission for the agricultural industries. The time is opportune for a new concept of the buying of our raw materials throughout the world. There should be an import-export board charged with responsibility for purchasing in the markets of the world the copper, ore, grain and other commodities required by us. Not enough is being done in this direction. All of this must be under the partial control of Government but to a greater extent under the control of the organisations interested in these commodities.

A simple thing which I advocated in my first election address was an encyclopaedia of the needs of world trade and commerce which would be easy for industrialists to use and determine requirements in a given part of the world. What has been done? Very little. Anything that has been done is complicated and difficult to follow. The bureaucracy in Government Departments is appalling and disgraceful. Another question which concerns us is the training of the young. There is nothing here to give an impetus to this.

There should be a new policy statement in which industry would be called upon to train its apprentices. Industry should be subsidised rather than the colleges. There should also be an interchange of young people between the floor of industry and the universities so that each section of what is our future generation knows the trials and tribulations of the other. Instead we have divided our people into hewers of wood and drawers of water on one side and intellectuals on the other.

We will not stand for that much longer. We have to speak as I speak, an uneducated, simple soul, not a university person, only a simple person placed in the category into which so many of my young compatriots are now being placed.

We need a new appraisal of the subsidy system which has evolved over the years. At this very moment we are advocating subsidies on food, but this is out of line with what could be done. There should be an assessment of the needs of every family and every individual within it. Each individual should be given an income commensurate with the needs of that family. That should be a statutory obligation. Each family should then be called upon to look after its own needs. The responsibility for the family should rest broadly on the shoulders of the parents of the family. If that were done and some violated the code of good conduct and did not look after their families, and if I were in power, then woe betide them! They would suffer for making others suffer. That is the type of policy that is required. Family life should be the responsibility of the family but we should see that the income meets the requirements of the family.

We read that company law is to be reformed. So it should be. But there are people other than directors or shareholders who are interested in company law. There is the man in the street, the consumer. If there are to be representations heard from shareholders, directors and from the shop floor I hope that representations will be heard from the consumers, too. Industry should be made to serve not shareholders or workers but the community at large. It would be wrong for any reform of company law to be brought about without writing in proper safeguards for consumers. There must be consumer participation just as much as worker participation.

Many of my hon. Friends believe that we shall achieve the perfect state by nationalisation. I do not accept that. In my day I have seen a transformation in government and government policies so complete that nowadays governments control every business in the land. They can make or mar a business by the fiscal policies they pursue. There is no need for any radical alteration. It only requires the Finance Act to be so phrased that business can be further curtailed in one way or another. By the utilisation of our fiscal policy we can do whatever we care with industry without bringing about a complete unheaval and making a mess of some profitable businesses upon which we depend. There is a need for a reorganisation of company law and there is also a need for reorganisation of trade union law.

There should be new codes of contracts between both sides of industry. A system for the control of profits, wages and prices is a necessity in this day and age. I know that it does not find favour with many, but we must have such a system or an acceptable alternative to it if we are to keep inflation in its proper place. I am not against inflation because it is through inflation that we achieve the prosperity necessary for an industrial country like ours to advance further, but it must be controlled inflation so that we may compete with our competitors throughout the world.

Those are some of the things that I should like to see happen. I could speak about the transport system and other matters, but time does not permit. The signs are evident for all to see. We are not making the progress, mentally or physically we ought to be making. There is a feeling that we could not careless—probably not in this House, but among the people. There is a sense of hopelessness. People are wondering what will happen next.

We must pay heed to the dangers that beset us today, and devise ways and means of tackling the situation. We must try not to make political capital out of every conceivable debate in the House but devote our time and energy to devising new schemes and methods which command common agreement. I hope and pray that we shall not be too late. I hope that we shall try to forget our foolishness and will devote more time to the serious business of trying to find in common ways to put our country where she rightly belongs—at the top of the tree.

7.42 p.m.

Mr. Charles Morrison (Devizes)

As the first Member to be selected by you, Mr. Deputy Speaker, to speak from this side of the House, I should like to join the hon. Member for West Stirlingshire (Mr. Baxter) in congratulating you on your appointment as Second Deputy Chairman of Ways and Means. I know that you will fill the post with distinction and I hope that your constituency will appreciate the honour done to you by this House.

I shall resist the temptation to travel along some of the byways up which we have been led so eloquently by the hon. Member for West Stirlingshire, if only because I know that the debate has to end at 10 o'clock. But I share his con- cern and that of other hon. Members expressed this afternoon about the situation in the Middle East, and I share the desire expressed for a lasting peace. One of the matters emphasised by the situation in the Middle East is the need once more for all of us in this country to make maximum use of our resources. In that respect I was pleased to read in the Gracious Speech: My Ministers will continue to take action to ensure an efficient and soundly based agricultural industry. I welcome that statement. It will be good for the agriculture industry, because it will provide prosperity for the industry and a better standard of living for those who work in it. It will be good for the economy because it should mean higher home food production and a greater saving on the balance of payments. It will be good for consumers because they will be less dependent on world food supplies, which are in ever-increasing demand. Therefore, I consider the statement in the Gracious Speech to be most encouraging and a commitment by the Government to continue to support agriculture and the expansion of the industry in the way they have done since the 1970 election.

But sadly there is a shadow hanging over the industry. I should like to correct the idea which has been fostered that agriculture is one industry. Agriculture is a group of closely integrated industries, one dependent upon another. That is becoming more and more true on all but the larger farms. Quite naturally, farmers want to make the best use of the capital at their disposal and in consequence they have tended to specialise. The Government farm advisory services have encouraged this trend.

Nowadays there are specialist egg producers, broiler chicken producers, and pig, beef and milk producers. The situation concerning milk producers is particularly interesting because even by 1971, 80 per cent. of the dairy cows in England and Wales were held on specialist and mainly dairy farms. Together those farms accounted for only 14 per cent. of cereal acreage in the country. In 1971, two-thirds of milk producers grew no cereals. That means that they are all dependent on outside sources for their animal feedstuff requirements.

I return to the question of the shadow over the industry. Our grain prices are high because world grain prices are high. This is no one's fault; least of all is it the fault of the Government. But its effect is serious on all livestock producers. High grain prices are to the advantage of cereals producers and that is pleasant for them, but they should be congratulated on year by year increasing their output; and this year they have produced a record harvest. The position of the livestock farmer would have been even worse today if it had not been for the success of the cereals grower.

But the fact remains that high grain prices are potentially dangerous for live-stock production. Feedingstuffs account for 80 per cent. of the total cost of producing poultry, 70 per cent. of the total cost of pig production, and 40 per cent. of the total cost of milk production. In the past 12 months farmers have had to pay up to 80 per cent. more for grain. The result has been that typical compound prices for cattle feeds, which ranged from £36 a ton to £43 a ton a year ago, are quoted from over £60 to over £70 a ton. Compound feeding prices have risen by as much as two-thirds. Clearly that cost increase is shattering to many livestock producers, and particularly milk producers.

A few weeks ago high cereals prices were having a serious effect on pig production and many sows were slaughtered. But luckily the market price has hardened and I believe the pig producer is in much less difficulty than he was only three or four weeks ago. The egg producer is also affected, but at present he has the benefit of a reasonable price for his eggs.

There is a moral to be learned from the experience of the egg industry. Last year, it was suffering from relatively high feed costs and some over-production, coupled with low returns. As the hon. Member for The Hartlepools (Mr. Leadbitter) commented, as a result a very large number of egg producers went out of production and, in consequence, there is now a shortage.

I do not want the same to happen with milk. Of course, there is not overproduction of milk but there are high feed costs and relatively low returns. The result is fear of a serious cut in milk production because of loss of constancy amongst producers and, possibly, loss of the financial ability to cope with the situation.

There will be no shortage or rationing of liquid milk, at least as long as we are not hit by the shortage of milk bottles which has been forecast and of which I hope the public has taken considerable note—I am sure that my hon. Friend the Under-Secretary of State with his worries about the environment, would be most pleased if more people made greater use of their milk bottles instead of throwing them away and creating more environmental problems—but milk production could be limited to the extent of having an adverse effect on manufactured milk products.

One recent estimate is that the possible effect of an increase in the sale of liquid milk, coupled with a decrease in production resulting from feed costs, would be a shortfall of 100 million gallons of milk for manufacturing purposes. That could mean a cutback in production of as much as 20,000 tons of butter and 40,000 tons of skimmed milk powder, which could worsen the country's balance of payments by some £20 million.

Any other industry subject to similar high cost increases would be allowed to increase its prices under phase 3 of the Government's economic policy. But milk remains the one commodity over the price of which the Government have control. Up to now, the Government have refused to acknowledge the dairy farmers' problems or, worse, the effects of those problems on agricultural production generally. The milk price today to the consumer is as it was in 1971. It is therefore not surprising that many dairy farmers are extremely resentful. Their production margin is being seriously reduced. It has been estimated that for 1973–74 their margin will be less than half of what it was in 1972–73.

I ask the Government to look again at this problem and to take action. If they do, they will be living up to their statement of intention in the Gracious Speech. If they do not, I think there will be genuine danger not just of a cut in milk production but of a reduction in the number of cows in the dairy herd and, in consequence, a reduction in the number of dairy replacements and a reduction in the raw material for beef production. If there were such a reduction in livestock, which is the main consumer of grain grown in this country, ultimately there could also be damage to the grain producer.

I therefore hope that the Government will take action to help the dairy farmer to remove the shadow hanging over the industry. If they do take action, not only will it be of benefit to the farmer but it will also be of benefit to the economy and to the consumer.

7.50 p.m.

Mr. John Golding (Newcastle-under-Lyme)

May I, as an Opposition Whip, Mr. Deputy Speaker, congratulate you on your translation from one branch to another of the parliamentary silent service. Also, I congratulate the hon. Member for Devizes (Mr. Charles Morrison) who, once again, when the benches were particularly thin on the Government side, stepped in with an excellent contribution on agriculture.

I wish to draw attention to a significant gap in the Gracious Speech, namely, the omission of any reference to broadcasting. This year will be important for broadcasting, and important legislation must be introduced. If ever there were a time for public discussion and debate about broadcasting, that time is now. Four issues face us—the extension of the BBC charter, the future of the Independent Broadcasting Authority, including the future of the commercial system, the allocation of the fourth television channel, and the future of cable and community television.

Plainly, we ought to have had a public inquiry into broadcasting. The first Minister of Posts and Telecommunications in this Government said it was too early, while the second, the right hon. Member for Bournemouth, West (Sir J. Eden), said not that it was too early but that it was not necessary. Despite this, the Minister has been collecting observations and evidence, which have been left to individual organisations and private publications to print. That is not good enough.

The Government should be printing the evidence submitted to them on the general future of broadcasting, and, in particular, they should be printing the evidence which is presented to them on the allocation of the fourth channel and on the future of cable and community broadcasting. This evidence is needed for informed public debate on the future of broadcasting. I believe that, before the Minister announces decisions—certainly before he introduces legislation—he should present to the House a Green Paper on broadcasting so that, even though a long debate may not be possible, we may at least have a brief informed public debate on this important topic.

In that way, we may be able to avoid a repetition of the mistake which was made in introducing the Sound Broadcasting Act. One of this Government's great mistakes was to permit the introduction of commercial local radio.

Together with many other people, I have listened, as a penance, to the London Broadcasting Company, the news station created by this Government for commercial reasons. That station would be a disgrace to a greedy Mid-Western oil baron. It is certainly a disgrace to London. It is trivial, shallow, mediocre. I have not found any hon. Member prepared to defend London Broadcasting as it now exists. In fact, interested people on both sides are saying that it will have to improve very quickly if it is to remain in existence. London Broadcasting has demonstrated that the Opposition were quite right when they strenuously opposed the Sound Broad-casting Act. So far it has failed absolutely to provide the minimum standard the public expect in broadcasting.

I have not listened to Capital Radio, although I have been told that it is far better than London Broadcasting but not of the high standard that we have come to expect from the BBC and from BBC local radio. This venture should be a warning to the Government not to fall for the arguments being presented by the cable companies when asking for the creation of a system of local commercial television.

So far local commercial radio has been a sad failure. It is mediocre. The same charge could be made against local commercial television. Indeed, the cable experiments now taking place illustrate my point. People do not regard them as successful.

There is a demand for local commercial television because companies such as Rediffusion are facing a crisis. They have been in business to provide a signal for individuals in areas where there has been an absence of effective public transmission. With the growth of both IBA and BBC transmitters, the necessity for the cable companies is fast disappearing; they are having to look for alternative work. That is why they are encouraging community television and advocating that it be put on a commercial basis. There will be no reason for their existence when everyone can receive signals from publicly-owned transmitting stations. Their proposals are against the public interest.

I shall not develop at length the theme that their proposals will hinder the development of an integrated telecommunications network. We need a cable system, but it must be a national cable system under public control. The production of programmes should not fall to a monopoly. There should be a national monopoly of the ownership of the cable which should form part of an integrated telecommunications system. The production of programmes is different and should be left to local initiative and local control.

The proposals of the cable companies are against the public interest because their financial proposals seem to depend upon advertising, rentals and pay-TV. I do not see how a local commercial television system will be able to exist merely on advertising. Already local newspapers have been threatened by commercial radio. If there were to be local commercial television, not only would the local newspapers be further threatened, but commercial radio would lose some of the advertising which had been taken from local newspapers.

I do not believe there is unlimited local advertising. The cable companies, if they were to exploit local commercial television through cable, would be forced either to charge a very high rental or pay-TV would be introduced.

I make no bones about it. Those in the cable companies faced with the extinction of their business will find every reason for the introduction of pay-TV. Although they quote many subjects that could be broadcast, it is clear that as institutions they are interested only in profit.

People will be absolutely opposed to pay-television. I believe that they should also be opposed to a commercial, local television service which provides only programmes that are profitable. The House should have no say in the day-to-day control of television, but we have to accept responsibility for creating conditions in which it can flourish. That is why we must not give TV4 to the IBA and why the Report on the IBA by the Select Committee on Nationalised Industries must be taken seriously and its recommendations implemented. I should particularly like to see implemented the law which prevents advertising in unnatural breaks in programmes.

Broadcasting, then, will be an important subject this year. When we consider the BBC charter, the IBA's rôle, the excessive profits now earned by the television companies and—along with the allocation of the fourth channel—the development of cable community television, it is important that we take account of the variety of interests. We can do that only if the Government present a Green Paper and encourage debate on their proposals. But the Government are here acting in a way diametrically opposed to the principle of open government. They are trying to take decisions on broadcasting behind closed doors and without adequate discussion, which is fundamentally wrong.

The Gracious Speech does a cosmetic job on the Government's policy; it hides the cuts in public building, such as the health centre in my constituency at Audley; it does not make provision for house building and it will not get rid of jerry-building; it makes no provision for getting rid of "lump" labour, and it fails to deal with increasing rents and mortgages. I would speak at length on this subject had not the indictment been made by the hon. Member for Birmingham, Edgbaston (Mrs. Knight) who in a few minutes utterly demolished her own Government's housing record.

The Government's proposals will have no impact on rising food prices. They will not deal with the crisis faced by the workers at Shelton and other steelworks. They do not deal with the real issues faced by my constituents. The wages policy is unfair and completely impractical.

There are some good proposals in the Queen's Speech. We need to tackle pollution and to deal with the health and safety of workers. We need to provide for worker participation. I will support these measures if they go beyond window dressing.

Much of what the Government have done over the past three years has been window dressing. They have told the country that they will do something, described in the title of a Bill, but on examining the legislation we have found that it falls far short of what was originally claimed.

The very name "fair rents" is a joke on council estates where tenants have faced one increase after another. Even last year's consumer protection legislation was quickly "tumbled". We quickly discovered it to be a Bill dealing with competition rather than protection for the consumer.

I welcome the measures concerning pollution, worker health safety and worker participation, as long as they extend beyond the window dressing of the legislation of the past three years. But apart from these measures, I believe the Queen's Speech to disregard the needs of most ordinary people and to be deficient in many respects.

8.12 p.m.

Mr. Richard Buchanan (Glasgow, Springburn)

During the debate several hon. Members have touched on a topic in which they specialise. Most have mentioned the Middle East. I regard as the most important paragraph in the Gracious Speech that which refers to the Middle East. Peace in the Middle East is an overriding priority for the whole world, because a spark from this conflagration could create an inferno.

The Egyptians and Israelis are two great peoples for whom I have a great affection, the Jews having been persecuted for centuries by Western Christians, and the Egyptians having lived under dictatorship from the time of the Pharaohs, never having had a decent standard of living. Yet the wealth, labour power and know-how are there in the Middle East to create a secure, happy and prosperous area. We may argue around United Nations Resolution 242 and the solution may lie within it, but surely it is not beyond the power of international organisations, instead of straddling cease-fire lines, instead of arming to the teeth, and trying to keep the peace by force of arms to ensure that the case is put to the International Court. Let the case be argued on its merits by both sides, for otherwise we shall live in a period of tension leading to war eventually so long as the Israelis and Egyptians look with hatred upon one another.

The inquitous factor in this situation is the supply of arms. As long as we have armament salesmen running around the world trying to sell their wares, we shall have the temptation to use these battlefields as an experimental field for armament designers. I wish success to the Foreign Secretary and the Government generally in their endeavours to find a peaceful solution to the terrible war in the Middle East.

Housing, a subject which interests me, is mentioned in the Gracious Speech. It is said that priority will be given to improving living conditions in the worst housing areas.

Coming from Glasgow, I consider that I live in a particularly bad housing area, despite all that the Corporation of Glasgow has done in building more than 140,000 houses since the end of the war. Glasgow, an old city, suffers from having too many old houses, and, due—in my judgment—to a mistaken policy, little or no attempt has been made to improve the existing housing stock. Differences of opinion between the corporation and the private landlord, led, in consequence, to tenements and houses in Glasgow falling down more quickly than they can be replaced. Much remains to be done to rescue them if Glasgow is not to face a calamitous situation. Much more financial aid is required.

In areas of reconstruction, before plans are complete, a derelict tenement will stand with broken windows and chimney heads lying in the back courts—an abysmal picture of dilapidation—yet that tenement has to stand until the whole plan is approved. Surely, it is possible for the Government to stimulate housing authorities by aiding them to clear and temporarily landscape such sites so that the citizen at least has something pleasant to look at.

I am surprised that during the recent period of unemployment the Government have not attempted to encourage the training and retraining of craftsmen. I disagree with the criticism of the trade union movement voiced by my hon. Friend the Member for West Stirlingshire (Mr. Baxter), although it would be justified were it directed to the training of apprentices. This country will never maintain its place in the world if it does not attain the necessary level of productivity, and it will not do that unless it makes the fullest use of its labour force. We cannot afford to allow men to languish in unskilled and semi-skilled jobs when they could be trained to do a skilled craftsman's job. The apprentice of today should be trained not in one operation, such as that of blacksmith, boiler maker, bricklayer, plumber or turner, but in multi-skills, and he should be prepared, with those skills, to take his place in the factory or on the site.

Undoubtedly, the price of land and costs has reacted badly against the building and modernisation of houses. The Government stand condemned because they have made no effort to curb the spiralling price of land. I was delighted to learn in the passage towards the end of the Gracious Speech, that the Government will do something about land tenure. I hope that that means feu duties in Scotland. We Scots are unique in the British Isles in that we continue to pay feudal duties. I am a vasal to a superior, to whom I pay about £28 a year in feu duties. The feudal system in Scotland is not just a curiosity; it affects the lives of hundreds of thousands of people.

The collection of feu duties is wrong in principle and should be taken out by the roots. Feu duties are an outdated relic of a bygone age. I hope that the Secretary of State for Scotland was sincere when he said, during the proceedings on the Conveyancing and Feudal Reform (Scotland) Bill in 1970, that he would stand by the abolition of feu duties, and I trust that he will see that implemented during this Session.

I have received some letters from constituents about company law in the construction industry. When a company goes bankrupt, no compensation for loss of wages or holiday pay is given to men working in the industry until the affairs of the company are cleared up. I know little of company law, but this is a point which should be borne in mind when the Bill is being processed.

I regret that the Minister for Sport has left. Having had some experience of sport in my youth I had hoped to awaken his interest. The licensing of football grounds is necessary and becomes more so as crowd indiscipline becomes more and more apparent.

Modernising and making safe grounds for the big clubs will be no problem. Clubs that can spend a quarter of a million pounds on a player may not find it difficult to make their grounds safe for the crowds, but we must remember the small clubs. The imposition on the small clubs would put many of them out of football altogether.

I well remember when, on a bleak December day last year, I was at a Scottish Second Division football game and the manager read out the teams, the referee and the linesmen and then said, "If you will bear with me a few minutes, I will give you the names of the spectators, too". That is true and it is typical of the state of many of the smaller football clubs. If they are forced into spending considerable sums on making their grounds safe for crowds they will need considerable Government help.

The Under-Secretary of State for Defence for the Royal Navy (Mr. Antony Buck)

Although he has lost the Minister for Sport, the hon. Member has gained here the president of Colchester United, a Fourth Division team in the South. I shall carefully note his remarks.

Mr. Buchanan

I am grateful for that and I hope that Government help will be forthcoming.

I come now to the provision of rural transport. While the 1968 Bill was going through Parliament and in all the subsequent transport debates it was stated that if a railway line were to be closed, alternative but transport would be provided. That is not happening, and even where rural bus transport is laid on, it is minimal—one bus in the morning and one at night. It is simply not good enough and I hope that the mention of rural transport in the Gracious Speech means that attention will be paid to providing an adequate transport service in rural areas.

I regret that for probably the first time since I entered this House in 1964 the Gracious Speech contains no mention of education. It is one of the most important aspects of our life. Many children in secondary schools in Scotland are on part-time education. These schools are desperately short of teachers and accommodation. The raising of the school leaving age might have seemed right at the time, although I am on record as saying that I thought that it was a mistake until we had sufficient teachers in Scotland, where we have secondary schools 20 and 30 teachers short, it is impossible to effect education in such circumstances. There are now gangs going about calling themselves the "ROSLA" gangs, "The raising of the school leaving age" gangs—making teachers' lives a nightmare. There is a crisis in education, and I am disappointed that the Government have ignored it completely in this Gracious Speech.

8.24 p.m.

Dr. Alan Glyn (Windsor)

In a debate on the Gracious Speech it is difficult not to go too wide because it embraces almost every subject with the exception of education.

I think the priorities are right. It started with foreign affairs, defence, disarmament, European co-operation and then home affairs. Members of the House must be aware that, without a sound foreign policy, without a strong policy of defence, there can be no possibility of peace, nor can there be an opportunity to create a better society. In the second half of the Gracious Speech many measures are being proposed which will have effects on helping individual people and raising our standards of living.

The hon. Members for West Stirlingshire (Mr. Baxter) and for Glasgow, Springburn (Mr. Buchanan) mentioned the third paragraph of the Gracious Speech, the conflict which has flared up in the Middle East between Israel and Egypt—possibly the most important event which has happened during the duration of this Parliament. I congratulate my right hon. Friend the Foreign Secretary on his courageous attitude. It may be that in a short term we shall be accused of breaking our arms contracts, but I am sure that the Foreign Secretary was right when he said that those considerations must be over-ridden by national considerations and that we could not possibly be placed in a position of being accused of fanning the flame of such a horrible and unfortunate war.

One thing which may have escaped the attention of the House during these debates—and perhaps it is not for my right hon. Friend the Foreign Secretary to comment upon it—is that in all these things the Government are in a position to know about world events. Surely they possess information which they are not at liberty to disclose even to this House. They must act on that information, much of which is secret. I congratulate my right hon. Friend on the way in which he has conducted our foreign affairs. There is no doubt that we have stood out as a great country, and I am sure that our rôle will be considerable in peace.

I disagree with the hon. Member for East Stirlingshire (Mr. Douglas) when he refers to the nuclear deterrent. Surely it is because we possess the deterrent and because we are strong that we are in the position of a great Power and that our voice is heard. It is because we have that power that we are listened to. We must consider, however, what will happen when Polaris is phased out. Do we go for Poseidon? However hard we work for peace in the years ahead there must be a period during which we shall have to maintain the ultimate deterrent.

In this last crisis it was shown clearly that the danger existed of the conflict spreading. The fact that the United States put itself in a position of readiness indicates the danger which faced the world. We shall never know what would have happened had the conflict continued. It could have been that Egypt would have discharged its missiles and Israel would have retaliated. Many cities could have been destroyed. No one knows whether the Israelis have nuclear warheads or the ability to deliver them. They were experimenting with them many years ago.

The difficulty is to persuade Egypt and Israel to reach an agreement. I am sure that the great powers, with all their willingness, will find it difficult to produce a solution which is acceptable to both sides. That must include giving up territory for Egypt and choosing a line which is reasonably secure for Israel.

I hope that in the long run this horrible war, with all its casualties, will have shown one thing to the two sides—that they can no longer resolve their differences by war. Those differences can be resolved only by a settlement between the two parties. In that settlement it will be the two great Powers which will assist in drawing up a peace formula. This will have to be the last occasion on which agreement is reached. We cannot afford a recurrence of this type of crisis every seven years. It must be more clear that this is the final settlement of the problem.

The Gracious Speech deals with defence. The great balance of power in the world is changing. That speech refers to links with China, and there is no doubt that the atomic station at Sinkiang is developing rapidly. China is becoming, and in a few years no doubt will be, a nuclear Power like Russia, Great Britain and the United States. That could alter the whole concept of international relationships. It may be that we are able to reach some sort of agreement with Russia which, with its huge frontier with China and with the chances of China having the ultimate deterrent, may be able to come to some rapprochement with Europe. Any agreement we reach, however, must be accompanied by a better method of supervision because no treaty is any good unless it can be enforced.

Naturally not one of us in the House, or in the world, does not want to see a reduction of forces. But these forces cannot, and must not, be reduced until we are absolutely satisfied that all those nations who are a danger to the world and who sign an agreement allow their countries to be properly inspected. That is the acid test of their willingness to abide by the treaty they sign.

Mention is also made in the Gracious Speech of the possibility of stabilising the currency. This is one of the greatest problems with which we are faced. Both sterling and the dollar will continue to be under pressure as long as we stand alone as a reserve currency. I am convinced that the only solution to the problem is to join with Europe so that we have a much greater pool on which to draw. Every time there was a call on sterling it would then no longer he a call on sterling alone but on a much greater pool and, therefore, we should have a much stronger and more stable currency.

If we had a much more stable currency, backed by arrangements with Europe, we might not need the high interest rates which are necessary to protect sterling from withdrawal of the sterling balances. If we can arrive at that we shall have achieved a great deal. My right hon. Friend the Chancellor of the Exchequer has done much in this field, but the sooner we achieve a European agreement the better. Until we have done this it will be difficult to have a stable economy.

The Gracious Speech also stated that GATT will be reconsidered. Whatever arrangements are made with Japan and other signatories, the agreement will have to be brought into the wider context of the whole of the world trading group. We are pledged to growth in the economy, and I am certain that Government policy is right in pursuing this course.

The Gracious Speech also referred to Europe. I am a pro-European, but much has to be done, rapidly, in Europe. It is right that we should share the burdens of defence in Europe with our European partners. We are supplying a deterrent. If we are trading with our partners in Europe and becoming integrated with Europe, it is right and proper that Europe should contribute a far greater amount of money towards the defences which we are providing not only for ourselves but for Europe, too.

I turn now to home affairs. People's attitudes must change if we are to be a successful nation. There is an inflexible idea that a person who has been to university or a technical college should not work on the factory floor. I cannot accept that there is a barrier in life between the two categories of work. Whether it is done in an office or on the factory floor, work should be part of a great team effort.

It is fundamentally wrong for people to believe, when they sign on in a certain category at the Labour Exchange, that it is their right to do that type of job for ever. The world is changing, categories of work are changing, and the whole of our industrial society is altering. After a person has been drawing benefit for three months he should be told if there is no chance of a job in his category. In my constituency someone who has been drawing benefit for a year refuses to change his type of job. After three months people should be persuaded to take a job for which they are fit. The idea of a barrier between the university graduate and the shop floor should be broken down, and people should be prepared to do any sort of job that is offered to them.

Britain offers young people tremendous opportunities, but we cannot refuse to change. If our industrial society is to be constantly changing, we must rely on re-employing and retraining people, accompanied by an understanding on their part that they must change their job if they want to continue in employment.

The Government have rightly harnessed our future to expansion. We are committed to a programme of expansion. It is on expansion, the creation of more wealth, that the future of our country depends. How can we increase the number of homes, social security benefits, educational opportunities, without a steady expansion of our economy?

We have tremendous opportunities. At the same time, we should always remember to watch very carefully our environment, and not allow ourselves to be eaten away by our bad industrial planning, and we should preserve our green belts, in which I have a particular interest. We should make sure that our countryside is preserved.

We need an adequate defence system, a strong foreign policy, integration with Europe, expansion and a genuine desire by all our people, whether employers or employees, to work together. Given that, the country can, if we can get our people to believe in their own ability and skill, and that their future depends on co-operation on both sides, go forward to a great future and increased prosperity for all sections of the community.

8.36 p.m.

Mr. Ernest Armstrong (Durham, North-West)

A topic which I consider to be very important but which I very much regret is not mentioned in the Gracious Speech, is education. The Gracious Speech rightly concerns itself with the quality of life. A great deal is said nowadays about the need, in the complex industrial society in which we live, to provide opportunities for the individual to express himself and reach his full potential. If that means anything it means that we must examine the opportunities provided in the education service.

I was surprised and disturbed to hear the comments of my hon. Friend the Member for Glasgow, Springburn (Mr. Buchanan) about the raising of the school leaving age and the extra opportunities thus given. It is one of the actions of the present Government that I applaud wholeheartedly. I am 100 per cent. behind the decision to raise the school leaving age. I regret only that it was postponed during the time of the Labour Government.

I have always taken the view that we ought to offer every child in the nation the opportunities that we demand for our own children. Not many hon. Members would consider allowing their children to leave school at the earliest opportunity. We all take for granted the benefits of a longer life. Certainly I think that the raising of the age to 16 was long overdue.

I want to say to the Government—not politically but as a former schoolmaster and a former chairman of a local education authority—that I move a great deal among teachers. Without fear of contradiction I can say that never, since becoming a teacher, have I known morale in the profession to be as low as it is today. That, put against the increase in the share of national resources that the educational service has had since 1945, takes some explaining, because the educational service under all Governments has claimed a bigger share of the national resources. But if we are to provide the kind of opportunity that children must have, particularly those referred to in the Newsom Report, "Half Our Future", we must have a bigger share of the national cake. I want to instance just one or two examples.

There is no doubt that cost limits on schools is having a disastrous effect on the school building programme. Authority after authority all over the country sends deputations to the Department of Education and Science because it cannot provide even the basic necessities on the cost limits laid down at present. The school building programme is being held up and all kinds of savings are having to be made which in 10 or 15 years will mean that much more of the nation's expenditure will have to go on maintaining and improving schools which are now being built substandard because of the effect of the cost limits.

Another topic which is really quite small in money terms is the teachers' superannuation scheme. This has caused a great deal of bitterness and resentment in the teaching profession, not because of the amount of money involved but because teachers feel that they have been let down by the authorities and the Department of Education and Science.

I do not want to go into all their grievances, but I can describe the situation very briefly. In June last year, after a working party had for some time considered the new proposals for superannuation, the teachers accepted with some reluctance—and there was a sizeable minority who thought that the scheme should not be accepted—the principles of a new superannuation scheme. The cost of the new scheme was estimated to be 17.35 per cent. of teachers' salaries. We all know that the teachers' superannuation fund is a notional one and not like many superannuation funds which others enjoy. The increase meant that the teachers were asked to accept an obligation which was to be increased from 6 per cent. to 6.75 per cent. of their salaries. The employers accepted an increase from 8.5 per cent. to 10.6 per cent. That made up the 17.35 per cent. Now the official five-yearly valuation of the scheme reveals that the estimate was too high and that the cost is 1.95 per cent. less than was expected.

Naturally, the teachers said that they should revert to 6 per cent. That is not a figure conjured out of the air. It is the amount that most local authority employers pay. The only two services which pay more than the teachers are the fire service and the police service, and we all know that firemen and policemen retire much earlier than teachers. So, to begin with, the teachers have had this sense of grievance. Of the 1.9 per cent, less that it is now revealed the scheme will cost, the teachers have been offered 0.15 per cent. That is an insult to the teachers, and many of them, not because of the money involved but because of their feelings that no one is concerned about them, their standing and their status in the community, feel a natural sense of grievance.

We know that teachers, along with public servants, have suffered under this Government's prices and incomes policy. Public sector workers have suffered all along the line, and the teachers have had more than their share of this treatment. I put it to the Government that there is a real need to make our teacher, feel that at least someone recognises the important part that they have to play if the quality of life is to be improved.

Then there are the London allowances. When I left college it was the ambition of most teachers to come to London to work. London's education authority has always had my great admiration, first under the London County Council and then the ILEA. There is no doubt that the size of the authority, the resources at its disposal and its tremendous leadership at both councillor and officer level, made London the kind of authority which attracted good teachers. On leaving college I should have liked to come to London, but I went home, to the North, for economic and domestic reasons. In those days teachers who got an A mark usual came to London to teach.

The situation today is not all the Government's fault. It is the fault of the changing society. There is no easy answer. I am not pretending that, overnight, any Government could solve this difficult and growing problem. With the high cost of housing in London, the London allowance has little effect. Something must be done urgently. In view of the crowded conditions in which some children are educated the Government must give serious attention to the question of the London allowance and so something to enable teachers to feel that the problem is understood and that the Government are willing to make their contribution to its solution.

A very distinguished headmaster of a comprehensive school—I understand that he is a Tory candidate—wrote an article in the Sunday Times a few weeks ago about the problems of truancy in London and other large cities. In rural areas and the area I represent this problem is nothing like as serious as it is in London. This headmaster suggested that the solution was to allow children to leave school early. If children were allowed to leave school when they wanted to, there would be no truancy problem, but there would be a social problem. The quality of life cannot be improved if children for whom the present school system does not cater are told, "There is nothing we can offer you. Get out into the wide world and make the best of it." If we did that we might solve the teacher problem, but we would create a much greater problem.

The hon. Member for Windsor (Dr. Glyn) spoke about co-operation in industry and the importance of enabling everyone to feel that they have a stake in the nation. We must get away from the division that the British education service seems to perpetuate and exacerbate rather than solve. I can remember when fee paying separated children. In Durham we soon abolished that. I am sorry to say that the extension of the grammar school system created just as serious a division as fee paying did. The British education system today is far too keen on labelling and classifying children and dividing them. It is just as injurious to separate children because of so-called differences in their intelligence and ability as it is to separate them on the grounds of their parents' income.

I am for the concentration that we have had in the last three years on primary schools. I was a primary school headmaster and I do not underestimate the importance of primary schools. However, in the education service there must not be a concentration on one sector at the expense of the rest of the service. The more that is done in the primary sector, the more important it is that when children reach the secondary stage the teachers, facilities and resources should be available to enable the children to profit from the improvement that was effected at the primary stage.

All that Parliament and the local authorities can do is to provide the resources and the climate for the professional teacher in the classroom to do the job effectively. The reason for the low morale at present is not all the political argument that rages, although some would have us believe that. Morale is low because the professional is being denied the resources, the facilities and the opportunity which would enable him to do the job in the classroom for which he was trained.

If we are talking about the quality of life and the improvement of society we have to begin in the schools. That is why I deplore the fact that in the Gracious Speech there is no reference to education. The first essential—I would not have said this five years ago—is to restore the morale of teachers, because they feel that the Government do not care and, even on small issues, have gone out of their way to say to teachers, "You are not very important, anyway."

Mr. Ernest G. Perry (Battersea, South)

Has the attention of my hon. Friend been drawn to the fact that in South London many children are receiving only part-time education; that there are not enough teachers or heads of departments to go round in subjects such as mathematics and English; and that parents are extremely annoyed that although they are paying their rates and taxes their children are having to come home in the afternoon and are not receiving a proper education?

Mr. Armstrong

I am grateful to my hon. Friend, who has experienced at first hand the reactions of London. I am certainly aware of the situation, because I have read about it in the educational papers as well as in the national Press, and I have no doubt that my hon. Friend knows many parents who are rightly concerned. It is disgraceful that in 1973 children are receiving part-time education; and, in the main, it is the children who most need the care and stimulus of dedicated teachers who are being denied the opportunities which they ought to have.

Finally, on the subject of truancy, I received a lot of letters after my reply to the article in the Sunday Times. Teachers were genuinely concerned about how to handle the reluctant learners who do not want to go to school. I have recently been to many schools. There are some schools in the North to which I would gladly take hon. Members. I could show them where, because the authority has provided the resources, because the school is generously staffed, and because the teachers have the feeling that somebody cares, children who would otherwise be reluctant learners are being helped.

In the education service we have created an artificial set of values, and it is no wonder that any child who does not shine according to those values is dubbed from early days as inadequate and inferior. If a child is labelled "C" or "D", he does not have to be told it every day; he knows it, because of where he sits in the class. There are these perpetual classifications, and it is no wonder that, after a year or two, parents say, "It is no use my child continuing there. He has been rejected, he is inadequate, he is inferior. We ought to get him out as quickly as we can." No wonder such children are reluctant learners.

I have more than enough faith in the teaching profession of this country to know that if the teachers were given the tools they would do the job and there would not be the reluctant learners about whom we read so much today. The omission from the Gracious Speech of this tremendous problem, to which there are no easy answers, reflects a complacency which ought to be brought to the notice of this House.

8.55 p.m.

Mr. Robert Redmond (Bolton, West)

I hesitate to follow the hon. Member for Durham, North-West (Mr. Armstrong) in too much detail on education because he obviously knows so much more about the subject than I do. His main plea was for more educational resources. I want to speak about the creation of more resources—in other words, increasing the cake rather than increasing the share of the existing sized cake.

I should like to refer to two parts of the Gracious Speech. First: My Government's continuing aim will be…to maintain their policies for promoting employment and for raising standards of living… The other statement in the Gracious Speech is: …My Government's primary concerns will be to sustain the expansion of the economy… Those are the things which come first.

I do not think there is any doubt that the present rate of expansion of industry must be maintained if we are going to break out of the vicious circle in which we have been for the last 25 years, and in the process of doing so we shall be able to provide more money for education, the social services and the like.

The great inhibition against expansion of industry and particularly among small firms—which is one of my particular hobbies—is being brought about by the intense shortages of many materials which are essential for the expansion of order books. There are three particular shortages which I should like to mention. First is the shortage of wood. Anyone who talks to any furniture retailer, as I have done in my constituency recently, will find that the manufacturers simply cannot supply the goods to meet demand. The manufacturers say, in the words of the "Goon Show", "I cannot get the wood". The result is that the retailers are importing furniture from abroad because the home market cannot be supplied, due to the shortage of the basic raw material.

There is a tremendous shortage of certain types of plastic. I mention in particular one which has come to my knowledge from a small firm which has been in existence for only three years. It has been making great progress, and indeed has an order book which is three times as big as it was last year. It could begin to export to about 40 different overseas countries if it could be assured of adequate supplies of polythene. Because it is a small firm it has not been going direct to the manufacturer of the raw material, which might be ICI or Shell Chemicals. It has been dealing through merchants, with what I would call wholesalers.

Last year that firm was using 30 tons of polythene. At that time my right hon. Friend the Prime Minister made a speech in which he criticised industry for not anticipating demand. This firm had been anticipating demand and, what is more, it has been anticipating a price increase. So it went to the limit of its bank overdraft in order to stock up with this raw material. Last year, using 30 tons, it was buying 60 tons. The situation today is that it is using 60 tons but it can get only 30 tons.

It seems absolutely crazy to suggest that the manufacturers of raw polythene have not increased their production over the last 12 months. Going from a period of relative slump to a period of boom, they cannot provide any more than they were supplying last year, and, in the case of the firm to which I have referred, they can supply only half of the amount they supplied last year.

The firm has used its fat, and is wondering whether to buy another machine, which would come in 12 months' time, or whether to hold back on investment, and let the foreign markets, which they have disclosed to me, go for good. What they are asking is, "How long will this shortage last? Can we have some forecast from the Government or from anyone to let us know when we shall be able to get all we want?"

The three partners have mortgaged their houses to start the business. They are creating jobs. Last year they were employing 30 people and they look forward, if they can expand properly, to employing 100 people this time next year. It is difficult to believe that there should not have been some forecasting amongst big industry which, as the Prime Minister suggested, might have anticipated demand.

Information about the steel shortage has been coming to me thick and fast from many firms in my constituency. One firm has told me that it has been told by the British Steel Corporation and by stockists that it can have this year 90 per cent. of what it had last year. At the same time the firm's order book has increased by 250 per cent. That firm has been working hard to establish new markets all over the world. It is now finding itself having to quote "subject to availability of supplies" in its dealings with customers. That seems to be utterly crazy.

Another company which has been in contact with me has taken advantage of Britain's membership of the Common Market. It has increased its order book by 150 per cent. during the last year. A large part of that increase has come from Common Market countries. It forecast its forward demands of sheet steel to the British Steel Corporation. It was told last summer that for the first quarter of next year it could have 60 per cent. of its requirements.

A third firm said to me, "If you do not do something to get the Government to get us more steel we must face 300 redundancies in our factory in the near future."

I have put these problems to various Ministers in the Department of Trade and Industry. Obviously I have had the natural answer which would come from any Minister—namely, that they cannot interfere with the day-to-day running of a nationalised industry such as the British Steel Corporation. I accept that. What I do not accept is that we should regard the present situation as the day-to-clay running of an industry. We are facing a national short-term crisis. We know that the British Steel Corporation is rationing its supplies. What we do not know is how it is rationing them. That we are entitled to know.

I have been getting letters from firms in my constituency and I have been visiting firms during the Recess to discuss their problems with them. In every case I have said, "It would help if I could have the details and your figures in a letter". The letters have been coming in. I have then said to the firms, "May I send this letter to the Minister?", or, "May I mention your name and your problem in the House of Commons?". In every case the firm has said "No. You may not disclose our name. We are scared that if the British Steel Corporation came to know that we have complained through you it might cut off our supplies even more."

There is a fear of victimisation by a nationalised industry among the small firms which have been getting in touch with me. It is only right that I should draw attention to that fear even though I have not the permission of the firms to disclose their names. If steel cannot be supplied immediately and if there is the serious fear of victimisation, it is necessary that the Government should ensure that the British Steel Corporation makes it clear how it is rationing its supplies. I must be fair to the British Steel Corporation. I do not necessarily believe that it would victimise a firm which had written to me.

Mr. McBride

I support the hon. Gentleman's view that the British Steel Corporation would not victimise any firm. Does the hon. Gentleman concede that because of Britain's membership of the EEC we shall be forced to increase prices, which will place the firms in his constituency at a serious disadvantage in terms of quality control, forward planning and exports?

Mr. Redmond

That is rather off the point. I do not believe that the British Steel Corporation would victimise the firm that complained to me. I am concerned that any firm should even believe that it is possible.

Sir Elwyn Jones (West Ham, South)

Has the hon. Gentleman disabused the minds of his constituents about this sort of fear? It is a very grave allegation that is being made. Has the hon. Gentleman played his part in saying that it is nonsense and that the Corporation could not behave like that?

Mr. Redmond

To the best of my ability, yes. I understand small industry. I have worked in it. I have never been a customer of the British Steel Corporation. The firms that have spoken to me are not willing to take the risk and that is the frightening thing. I have tried to put the fear to the Corporation. I go further and say that the Corporation has an additional difficulty, and it is only fair that it should be pointed out. Many of the firms complaining to me about shortages have never been direct customers of the Corporation to any large extent.

The Corporation is naturally looking after its prime customers, as far as I can make out. The people who are complaining are those who buy from stockholders. We cannot expect the Corporation to control the activities of the stockholders, certainly not at the moment. There is such a crisis that it would be reasonable to introduce some form of rationing and to expect stockholders to conform to it. Then we might get to the bottom of this. One large user of steel in my constituency has said that although he has experienced short- ages he has always drawn his supplies from the Corporation and, while he is not getting as much as he would like, he has every reason to think that in 12 months hence the shortages will be over.

The Government have not only to say what the rationing system is and whether it is fair but for how long the shortages are expected to last. If we knew that we would be on firmer ground. One constituent firm which mentioned this period of shortage made a valid point. It was put to me that if I made too much about steel shortages it might well persuade architects and consulting engineers that the shortage would last for a long time and therefore architects could begin to design steel out of their buildings, to the great detriment of the users of constructional steel. It is even more important that we should have a firm forecast from the Government.

What I say about this is not likely to have as much effect as what is said by others who may put the wrong ideas into the minds of achitects. It was put to me that if architects began to design steel out of their buildings and instead the vast new buildings going up in London were to be made entirely of concrete, it could mean that they would be difficult to demolish and the only way to get them down would be by explosives—rather dangerous in a city like London.

Something is going wrong if a firm is rationed to less than 100 per cent. of what it had last year. We knew that the British Steel Corporation has increased its output. The Government should look carefully at public works contracts to see which are not absolutely essential and which are using steel so that it might be diverted to industry, thus securing the employment of people in the industry. To that extent I was, not happy, but content that my right hon. Friend the Minister for Transport Industries did not give an automatic go-ahead to the project underneath Manchester usually known as the "Pic-Vic" Line.

I understand that it had already been earmarked for several hundred thousand tons of steel. I am glad to think that some of that might go to my constituency firms who need it for export orders and the like.

I have three questions for the Government. Why is there a shortage and why have the big firms not expanded their output? How long is the shortage likely to last? While there is rationing can we see it applied throughout the industry, through the stockists, and not just by the British Steel Corporation?

9.10 p.m.

Mr. Harry Gourlay (Kirkcaldy Burghs)

I shall not follow the dissertation of the hon. Member for Bolton, West (Mr Redmond) on steel, but I should like to take him up on his remarks about increasing the cake. I am sure that the hon. Member will agree with me that the major contribution to increasing the cake in this country—that is, increased productivity—is due in the main to the workers. The Government are not giving the workers their fair share of the increased cake being produced.

Mr. Redmond

In two firms I mentioned particularly, the people who have done most towards increasing the size of the cake have been the salesmen, who have gone abroad, particularly into Europe, and obtained the orders for our people to work on. We should give credit where credit is due.

Mr. Gourlay

I am always willing to give credit where credit is due, but unless the goods are produced in increasing amounts there will be nothing for the salesmen to sell. Initially the responsibility falls on the people producing the goods and they are entitled to receive a fair share of the cake.

In my 14 years' membership of this House, I believe that this is possibly the most disappointing Gracious Speech with which the House has been presented. It fails to tackle effectively the problems facing us today, mainly those of rising prices and limited wage increases.

The Chancellor of the Exchequer had the audacity to visit the Edinburgh, North constituency on Saturday of last week and to go into a part of Edinburgh called Stockbridge to meet the housewives, where he was literally chased for his life because he was shocked that the housewives there knew what rising prices meant and apparently he did not. His lack of knowledge was such that I understand that his visit in the shopping centre was curtailed and he was buzzed off to another part of Scotland.

Only a fortnight ago in London we had a big demonstration by the women of Scotland, whom the Prime Minister refused to meet, to discuss the question of rising prices. The right hon. Gentleman has said that he knows all about it and that the Government have spent more time than possibly any other in trying to find a solution to the problem. But that was the promise on which the Government were elected in 1970. Not only were they going to contain prices; they were going to reduce them. They have failed lamentably. As the years have gone by, they have also failed lamentably on quite a number of other promises which they made before the 1970 election.

The Gracious Speech says that The reform of taxation will continue. I can assure the Chancellor of the Exchequer that there is only one reform which would be welcomed by the majority of the people in this country, and that is that those on low and average wages should be given a better deal in direct taxation. Whenever there is to be a reduction in direct taxation, the people at the lower end of the income scale should be relieved—and here I mean the retirement pensioners and those on low and average wages and not the people in the supertax range who have received tax relief from the Chancellor.

The Gracious Speech refers to the Government's intention …to maintain their policies for promoting…the health…services and to …have particular regard to the requirements of the old, the sick and the needy". This, to my mind, is sheer hypocrisy, because I learned only the other week that the Government have issued an edict to the regional hospital boards to cut back capital expenditure and ruling that no further projects involving capital expenditure will be embarked upon before the end of the year. This, in effect, means that all programmes of capital expenditure will be pushed back for some time to come.

In my area, we have the worst geriatric service in the whole of Scotland, if not in the whole of Britain. We have a waiting list on the orthopaedic register in the Victoria Hospital, Kirkcaldy, which is possibly the worst in Scotland. I know of a case where, a year ago, a lady was invited to take a bed in the hospital for an operation but, because of some casualty during the weekend, she could not be taken in and she is still, 12 months later, waiting to have this urgent and necessary orthopaedic operation. That example can be multiplied a hundred times in the area. The Government are cutting back expenditure on these vital services.

The Gracious Speech says that My Government will again review retirement…pensions and related benefits.' It is true that they increased pensions this month, but since the last increase there has been an enormous rise in the cost of living and, despite the statistics which the Government continue to put out, the increase does not meet the reduced standard of living of the pensioners over that period.

Then we have the case of the £10 Christmas bonus. As one pensioner said to me, one would have thought, from the television programmes, that the Prime Minister was going to pay £10 to each pensioner out of his own pocket when, in fact, the person who pays is the average wage-earner, the contributor to the National Health Service through the insurance contribution, which will be increased in order to help to pay not only for the increase in the retirement pensions but for the £10 bonus. Even so, the Government have still stopped short. There are many handicapped people who are as much entitled to the bonus as those pensioners but who will be denied this year's Christmas bounty.

Then, almost as an affront, we read in the Gracious Speech that My Ministers will continue to give high priority to housing policies… What does it mean? In my area, fewer houses have been built during the three years that this Government have been in office than have been built in that area for a long number of years. In addition, the rents are being forced up every year as a result of the Government's policies, and because the rents are so high the number of people on the waiting list is affected. Many people needing homes dread to contemplate the rent with which they would be faced should they be fortunate enough to get a house. It is only when they are in dire circumstances, in dreadful housing conditions, that they are prepared to ask for what they are entitled to, which is a new corporation house.

I hope that the Government will have second thoughts when they review their priority in housing policies and rents, especially during phase 3. I hope they will also change their present subsidy structure in such a way that local authorities will again be encouraged to provide for those in need.

One bright spot in the Gracious Speech is the suggested legislation for the licensing of sports grounds in the interests of the safety of spectators.

In the absence of the Bill one cannot say too much, but I hope that, while something needs to be done in this area, consideration will be given even to the senior clubs of this country, which are often in financial difficulties—despite the huge transfer fees which pass between some of the clubs, which, however, represent only a few of the total number of clubs. The majority of clubs find it difficult to make ends meet, and if safety precautions are to be introduced, I hope that some financial aid will be given to the clubs which are in need.

On the question of road safety, also mentioned in the Gracious Speech, I suggest that the Minister for Transport Industries directs his attention in particular to the motorways. There is a speed limit of 70 mph, but if the police patrols gave more attention to the heavy lorries on the motorways rather than to the motorist travelling at 80 mph they would be doing much more to encourage and create safety on our roads and motorways. One often discovers that not only is there one heavy vehicle in the centre lane overtaking another heavy vehicle but there is another in the fast lane—three heavy vehicles, one in each lane. That is more likely to cause accidents on the motorways than a vehicle doing five or 10 mph more than the permitted maximum.

Mr. McBride

Has my hon. Friend thought of the dangers to others caused by the drivers of flat-fronted commercial vehicles who, as excellent judges of pace, keep exactly one foot behind one's car when in the centre lane, so that it is not possible to see overtaking vehicles? That constitutes a considerable danger.

Mr. Gourlay

I am much obliged to my hon. Friend, because this is one of the many aspects of motorway driving which creates danger. Even on dual carriageways which are not motorways the slow, heavy vehicles pass each other, and frequently a long caravan of heavy vehicles travelling at 40 mph or 50 mph build up to prevent faster traffic from overtaking. The frustration caused by these heavy vehicles is the prelude to many accidents on our motorways and our dual carriageways—a frustration that is far more dangerous than the speed at which other motorists drive.

Road safety brings me to the matter of London Transport. Many hon. Members are obliged to use London Transport, but the service on the London Tube is becoming deplorable. As the fares increase, so does the service decline. Unless the Government take definite action on a wages policy that will enable London Transport to recruit the necessary staff in the near future, many services on the London Tube will grind to a halt. Heaven knows what the City would be like once the Tubes failed to operate effectively.

There is reference in the Gracious Speech to legislation dealing with the Channel Tunnel. I have supported the idea of a Channel Tunnel over many years, but I am not happy with the position at the moment—certainly not until some parts of the country have had a fairer share of the available cake. I refer particularly to Scotland, where the amount of motorway is infinitesimal. With the coming of the oil firms to the east and north of Scotland a great deal of road improvement is required, not least in my own county and constituency. I hope that some of the money available to the Government will be spent in that part of the country before we start spending money on a Channel Tunnel.

I give a welcome also—though a qualified welcome, since we do not know much of the detail—to that part of the Gracious Speech which tells us the Government intend to reform certain aspects of local government finance in England and Wales and to establish machinery for investigating complaints of maladministration in local government. Only last week, we gave final approval to legislation for the reorganisation of local government in Scotland. I hope that that is a mistake in the Gracious Speech and that we are to have a reform of local government finance in Scotland as well. It would be far better if the reform of the financial structure of local government in Scotland were taken at such a time as to coincide with the election of the new authorities, which is to take place in 1974, but not become effective until 1975. I regret that apparent omission from the Gracious Speech implying that the reform of local government finance is confined to England and Wales. I am not sure whether the appointment of an Ombudsman to deal with maladministration in local government will apply to Scotland as well, or only to England and Wales, as one would presuppose from the wording of the Gracious Speech. Perhaps the Government will clarify this.

I welcome the reference in the Gracious Speech to the measure to be brought before Parliament regarding the general law relating to land tenure in Scotland. This is long overdue, and I hope that the Bill will be of a generous character, enabling us to eliminate the anachronism in Scottish land tenure called feu duty, which has prevailed for far too long. Many people there will welcome the abolition of feu duty.

Oil is not mentioned in the Gracious Speech, but I hope that the Government will take steps during the coming Session to see that absolute control is taken over the rate of extraction of oil from the oilfields in the north and east of Scotland, and that the requisite taxation is levied on companies extracting oil from the North Sea, as there is no doubt that this country will benefit tremendously if a correct rate of tax is levied.

The most ominous part of the Gracious Speech is contained in the words near the end: Other measures will be laid before you. That is the mystery. That is what we do not know. I am sure the Government have something in mind which they are not going to tell us now. As in the past, we shall have to wait patiently to see what those other measures are, but for my part—and, I am sure, for the majority of the people—I would rather the Prime Minister chose to call a General Election and let the people decide what other measures should be laid before this House, rather than that this Government should have that opportunity. Another year of Tory rule is far too horrible to contemplate.

9.29 p.m.

Mr. Nicholas Scott (Paddington, South)

Before I come to my main theme, as a Member for inner London, I should like to say a word about shortages in some service industries and public services in London, mentioned by other hon. Members.

It was particularly significant that in the consultative document on stage 3 of the Government's counter-inflation policy the Government made it clear not only that certain London allowances and weighting would be settled outside the pay limits applying to normal pay settlements but that they had asked the Pay Board to make a particular study of the London allowances paid as compensation against the extra cost of living and travelling in the capital. I look forward to seeing that review when the Pay Board produces it. I suspect that when we see it, in time we shall want to go a little further even than that definition.

If one looks at the relative position in the pecking order of, say, a primary school teacher in a provincial city and one in London, one sees that the salary in the provinces produces a higher absolute and a higher relative standard of living than does that salary, plus London weighting, for a teacher in the capital. In due course we may have to think radically about the sort of inducements that we offer to those in the public and central services who work in London and by their presence help to ensure the high quality of life in London.

Some of this may come in the sentence towards the end of the Queen's Speech in which the Government undertake to give priority to the problem of those suffering special disadvantages from the conditions of life in urban areas. We have to ensure that we do not allow the quality of life in our cities to deteriorate and that, among other things, means ensuring that those who work in the public and central services are properly paid and have proper inducements to come and work here.

I believe that when the Government eventually face the electorate they will rightly be able to claim to have been a radical Government, a caring Government and an expansionist Government. They have been radical. I do not think that any of us would doubt that by 1970 there was a grave need for a radical Government, one able and willing to look at some of the nonsenses that beset our national life and with the political will to put them right.

Thus they embarked on a programme of reform of taxation, industrial relations, and social services, all in the context, or against the backcloth, of our entry into the European Community—and the development of our European policy is clearly an important part of the Gracious Speech.

But the radical approach of the Government towards our national life is reflected particularly in the proposal to produce a Green Paper on the participation of workers in industry. I hope that if we do, we shall be more concerned about building on our British tradition of consultation from the bottom in industry, rather than imposing some system from on top and pretending that over-night we can change attitudes that have developed over the years. Nevertheless, henceforth employee participation in the management of industrial and commercial enterprises will be a radical and welcome step forward in our economic and commercial life.

I paraphrase the remarks of the right hon. Member for Coventry, East (Mr. Crossman) in The Times about the Government's plans for ensuring genuine equality of opportunity for women. He asked whether women could have expected plans as radical as this from an administration consisting of his own party. The clear answer to his rhetorical question is, "No". It takes a Tory Government to bring forward proposals of this radical nature. They will be able to claim to have carried on in this Gracious Speech the theme of being a radical Government, but also a caring Government.

Since this Government returned to office, six totally new social service benefits have been introduced filling gaps which had appeared in our pattern of social services that had been neglected by previous administrations. Those gaps have been plugged and in this Gracious Speech are two important developments along this theme of a caring Government. First, there are the proposals for implementing in broad terms the Robens Committee Report on Health and Safety at Work. Secondly, and much mole fundamental, there is the introduction of the tax credit scheme, which can provide us at last with a replacement for the plethora of means-tested social security benefits which we have had by a simple, automatic and fair way of getting help for those who really need it. The Gracious Speech continues the theme of a caring Government.

But no one will understand the present Government unless they take on board their commitment to a sustained growth of the economy so that we can pay for the reforms which are mentioned. In the Gracious Speech, the Government repeat their commitment to sustain the growth of our economy.

Only one thing can possibly prevent us from achieving a more sustained period of growth than this country has enjoyed since the end of the Second World War, and that is inflation. The fair and flexible proposals that the Government have put forward for stage 3 of their counter-inflation policy enjoy the broad support of the vast majority of people in this country. If they are carried through to fruition, they will be in the interests of trade unionists and non-trade unionists alike. They can bring real and lasting benefits to the people. Anyone who sought to undermine them by militant opposition, by unfair distortion, would be hitting, not only at the present living standards but at the prospects for increased and improving living standards of the whole working population.

Mr. Elystan Morgan (Cardigan)

Does the hon. Member seriously put to the House the fact of the disbursement of £300 million and above to the higher income earners of this country as evidence indicative of the caring nature of a radical Government? Does he say that the best basis for growth was in a period of 3½ years to convert a £1,000 million surplus in to a £1,000 million deficit, as it will be by the end of this year? Is that his argument?

Mr. Scott

I put two points briefly. I have never known what is the purpose of a surplus if it is not for use in the expansion of the economy. We have criticised other countries for building up surpluses and not then being prepared to use them. Secondly, when we returned to office in 1970 our tax system was over-cumbersome in the burdens it placed on those in a position to play their part—I mean people working on the shop floor as well as elsewhere. The system was too difficult and complicated to operate. We have reduced and reformed the burden of taxation since we returned to office.

9.38 p.m.

Mr. Gwynoro Jones (Carmarthen)

I was of two minds whether to try to catch your eye at this stage in the debate on the Gracious Speech, Mr. Speaker. But having listened to the hon. Member for Paddington, South (Mr. Scott), I am glad that I decided to say a few words.

This is a period of disillusionment with politics and politicians among the public, and despite the moderate and gentlemanly manner of the hon. Member for Paddington, South and the way in which he presented his case, I can understand that disillusionment. He asked why we needed a balance of payments surplus. My word, how things have changed! Three days before the last General Election we had a balance of payments deficit of £30 million in one month. The then Leader of the Opposition, now the Prime Minister, made tremendous play of that. Now we are in the era of monthly deficits of £150 million to £200 million. Conservative Members now say quite cheerfully that this is a fact of life and that this is why they were elected.

The hon. Member for Paddington, South raised the subject of prices and inflation. The Prime Minister said before the last election, while still Leader of the Opposition, that if a Labour Government were returned there would be a 15p loaf. The hon. Member for Paddington, South will not have to wait too long before he sees that happen under his own Government. What will he say to his constitutents when that happens?

The hon. Gentleman also said that there was a need for a radical change, as things had been so terrible under a Labour Government from 1964 to 1970. But at that time price rises were running at between 6 per cent. and 7 per cent. a year. House prices were such that an ordinary worker could afford to buy at reasonable interest rates and young farmers could afford to buy farms.

During those terrible, non-radical days of a Labour Government the regional development policy was vigorously pursued. But the present Government decided to abandon that development policy and investment grants, but 12 months later had a change of mind and reintroduced them. It is no wonder that there is disillusionment.

We have been told that this is the Government that care. No doubt they care somewhat. They introduced an annual review of the old-age pension, which everyone welcomes. The Prime Minister will say that pensioners have had a large increase. But they have had to meet increased costs of food, fuel, transport, heating and lighting, all of which have gone up by between 30 per cent. and 35 per cent. Therefore, they needed a record increase in pension. There is no cause to boast that the pension has been increased by the largest-ever amount. It had to be, because prices are increasing faster and faster, to a record level.

Mr. Scott

Does the hon. Gentleman dispute the figures, that by 1st October pensions had gone up by 55 per cent., earning by 45 per cent., and prices by 37 per cent. since June 1970?

Mr. Jones

That is the percentage argument. Two-thirds of the pensioner's income is spent on food. If food prices increase by a record of 30 per cent. to 35 per cent. in 2½ years, it is not a question of given percentage pension increase but what the pensioner spends the money on, and by how much have those items gone up by.

The Gracious Speech covers a wide area, outlining the Government programme. At first glance one could think that it was rather innocuous, and harmless, that there was nothing controversial for the next year, and that we shall have a quiet time during which the Government will hope to face better weather and pray that the memories of the electorate will be short enough to enable them to stay in office for the remainder of the 1970s. But the Speech outlines a Government policy full of inconsistencies. For example, it says that the aim will be to achieve the necessary improvement in the balance of payments. With the deficit running at £1,000 million a year, that should have been the first priority.

The Speech also says that the Government will continue to give high priority to housing policies". The hon. Gentleman talked about a radical Government. During the "bad old days" of the Labour Government, from 1965 to 1970, the average number of houses built in Wales was about 20,000 a year. The number is now down to about 14,000. I hope that the Government will give a higher priority to housing policies.

We also read that the Government will try to contain public expenditure, but they are to improve the health, welfare, educational and other social services. They will have particular regard to the requirements of the old, the sick and the needy. How are those matters to be paid for? Growth is one way, but if growth is declining, as is indicated at present——

Mr. Knox

rose——

Mr. Jones

I will not give way to the hon. Gentleman. He has not been in the Chamber long.

If all those services are to be paid for, how can the Government argue for a reduction in public expenditure?

With regard to the European Economic Community, the Gracious Speech refers in particular to the efforts that will be made to establish an effective regional development fund. Although an opponent of the Community, I feel that if anything is coming to us while we are a member it is better to accept it than to reject it out of hand. But in order to be helpful the fund must be able to disburse £200 million to £300 million a year to the regions of Britain and other parts of the Community.

I had originally intended to speak about the agriculture industry, one of whose problems is the escalating cost of animal feedingstuffs. The Gracious Speech says that My Ministers will continue to take action to ensure an efficient and soundly based agricultural industry. Representing one of the largest agricultural constituencies in Britain and certainly the largest dairy-producing constituency, producing more than 60 million gallons a year and now probably getting on to 70 million gallons and bringing in £8 million to the local economy of Carmarthenshire, I am duty bound to express a feeling of disappointment with the Government's failure to control and recompense for the escalating costs in feedingstuffs. Animal feedingstuffs costs account for 80 per cent. of the production costs on poultry, 70 per cent. on pigs and 40 per cent. on milk. Over the last year animal foodstuffs have increased by up to 80 per cent.—that is, in one year, from £36 to £43 a ton to a figure now of £61 to £72 per ton. That is an astronomical increase.

While the housewife on the one hand will say, "It has nothing to do with us", at the end of the day, if farmers are to purchase less animal feedingstuffs, and are not to get a sufficient incentive, not only total production, but quality will suffer and 12 to 18 months from now the consumer will be paying the price.

The increase in production costs will lead to a tremendous financial problem for the farming community. It will have to borrow working capital at record interest rates, during a period of high interest rates and when the basis of the Annual Price Review of 1973, certainly in terms of milk, has not been met. The review, as it concerned milk, was based on four principles—that calf prices would increase further but that animal feedingstuffs would decline in price. That the peak had been reached in February and March of this year. Since then we have become aware of the record increase that there has been. Finally it was said that the milk yield would continue to advance and that the price of culled cows would rise. All these have failed to materialise.

The Farmers' Unions were in the main in support of Britain's entry into the Community. But both organisations and certainly farmers in my constituency believe that a special price review has not materialised because we are now members of the Community.

Mr. Knox

Will the hon. Gentleman explain how our entry into the Community has made the slightest difference to the real problems which farmers face today?

Mr. Jones

I believe that the hon. Member for Leek (Mr. Knox) knew what I was about to say. To ensure that he does not feel obliged to accept a biased report, perhaps I might refer him to what the National Farmers' Union says. Under the 1956 Agriculture Act there were provisions for a special review when costs reached a certain level. It was automatic. The NFU says that under the special price review procedure the Government would have been bound to adjust commodity prices in the second half of 1973–74 in the light of the increase in feedingstuff costs. It says that the procedure was abandoned with our accession to the EEC. In other words, the NFU is saying that due to our signing the Treaty of Accession the special review procedure has gone. The special review procedure was used in October 1970 when about £50 million was handed to the farmers. Now, because we are in the Community, this can no longer be done. Certainly that is the impression of the farming community, and this at a time when it is anticipated that during a full year the estimated increase in production costs will be at the record level of more than £400 million. Clearly a measure of assistance is needed now.

If time permitted I would refer to a number of other aspects of the Government's position. We have heard from the Prime Minister about the fantastic increase in incomes which the farming community will experience over the next couple of years. The right hon. Gentleman said that net incomes were expected to be 26 per cent. higher in 1973–74 than they were in 1972–73. The farming community has refuted that statement. It is said that this is not the case.

What has happened, of course, is that the Prime Minister has taken account of the exceptionally good year experienced by our cereal producers. However, this has no bearing on the major problem confronting milk producers in Carmarthenshire, Wales and the rest of Britain. They will not benefit from the advantages which the cereal producers have enjoyed.

I wish to refer briefly to two other matters touching upon agriculture. The first is connected with the loss of confidence amongst our farmers and it concerns land prices. Recently Farmers Weekly published some figures showing that between January and June 1972 the price of agricultural land was in the region of £423 per acre and that between July and December 1972 it had risen to £718. In other words, in a period of six months the price of agricultural land more or less doubled. It was £726 an acre in January/March 1973.

The Gracious Speech makes no reference to what will be done to counteract what is happening in Carmarthenshire and other agricultural areas where speculators, property companies, people with no connection with agriculture and who certainly cannot be termed working farmers, have purchased land. As the Government are calling for increased home production, for a greater effort from the agricultural community at a time when it is losing confidence faced with the cost of animal feedingstuffs, what justification is there for allowing to continue this practice of people unconnected with agriculture purchasing land in the hope that one day planning permission will be granted and they will then make a fat bonanza

I could pursue this theme in terms of the impact it is having on a county like Carmarthenshire where the farming community is mainly Welsh speaking and where a reduction in the acreage devoted to farming and in the number of farmers has serious social and economic consequences.

Connected with the cost of land, animal feedingstuffs, loss of confidence and the price of stock, is the problem of the young farmer. An average farm in Carmarthenshire can cost anything up to £40,000, with stock and machinery costing £10,000. How on earth does the Minister of Agriculture, Fisheries and Food expect young farmers, even the sons and daughters of existing farmers, to purchase farms at these prices If they are able to put a quarter of the price down as a deposit, they must find £200 to £300 a month to repay the purchase price, let alone the stock.

The Government are facing a difficult period. Despite the Prime Minister's efforts to quieten the scene with non-controversial matters, it is coming to the stage where the Government must justify to the people why they have been unable to keep the promise on which they won the 1970 General Election to contain, indeed to decrease, inflation. The Government will have to meet the people on the central issue of what benefits the Economic Community have brought us. At the end of the day the Government will have to explain how radical they have been compared to any previous Government.

Debate adjourned.—[Mr. Hall-Davis.]

Debate to be resumed tomorrow.

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1. ADJOURNMENT 12 words