HC Deb 29 July 1975 vol 896 cc1643-73

'1. If an employer, in the period 1st August 1975 to 31st July 1976, pay to an employee an amount in excess of the levels laid down in Command Paper No. 6151 "The Attack on Inflation", he shall be guilty of an offence and liable to a penalty of£400 on summary conviction and an unlimited fine on indictment.

2. If a trade union, in the period 1st August 1975 to 31st July 1976, promotes, encourages, supports or finances industrial action, the purpose of which is to persuade an employer to pay an amount in excess of the levels laid down in Command Paper No. 6151, then it will be guilty of an offence and liable to a penalty of£400 on summary conviction and unlimited fine on indictment.

3. If any employee, in the period 1st August 1975 to 31st July 1976, engages in industrial action the purpose of which is to secure a payment in excess of the levels laid down in Command Paper No. 6151 then—

  1. (a) no payment of supplementary benefit should be made to him or his dependants duration of the action."
  2. (b) for the purpose of the Trade Union Labour Relations Act 1974 "trade dispute" should exclude any such industrial action.'. —[Mr. Kenneth Baker.]

Brought up, and read the First time.

Mr. Kenneth Baker (St. Marylebone)

I beg to move, That the Clause be read a Second time.

Mr. Speaker

With this new Clause we are to discuss new Clause 8—Repeal of criminal offence provisions: 'Section 17 of the Counter-Inflation Act 1973 shall cease to have effect from the date of the passing of this Act'.

Mr. Baker

The purpose of the clause is twofold—first, to provide an opportunity for the Secretary of State and the Government to clarify the position concerning their view upon legal sanctions and the reserve powers and, secondly, to try to establish the principle that if legal sanctions are introduced they will be introduced in an even-handed way and will bear not just upon one side of a wage bargain but upon both sides of it.

The House will appreciate that much of the debate on Thursday and Friday morning, and the debate this evening on Report, centred on the question whether this was a statutory or a voluntary policy. This theme has consistently been raised on all the clauses and amendments that I have heard. It appears to me that we are debating a statutory policy. If words have any meaning—and it seems to me from the Secretary of State's defence of this Bill that perhaps words do not have much meaning for him—this is a statutory policy, and the Government have established a level of£6 above which wage settlements should not be made.

Secondly, by doing this the Government have put an end to free collective bargaining until next year, in effect, for one cannot have a system of free collective bargaining which has a cut-off point. It ceases to be free collective bargaining. One can bargain up to£6, but one is not allowed to bargain above£6. It would be much better if the Government were frank on this and said that it is a statutory policy.

My third reason for believing that it is a statutory policy follows from the sanctions that the Government have already brought in in the Bill and the White Paper. There are three specific sanctions, and in Clause 3 the Government actually use the word "sanctions" in dealing with the Price Code.

The second sanction is that concerning local authorities. The Secretary of State for the Environment, on Friday last, made it clear that there were sanctions that would operate on local authorities which might be tempted to exceed the£6 limit, and I suspect that that sanction will be successful. I should have thought that very few local authorities would have the determination and resilience of Clay Cross in the face of what the Secretary of State for the Environment said on Friday.

The third sanction in the White Paper relates to the Government's own employees, and particularly the Civil Service, where the Government have made it absolutely clear that they will operate this policy, and operate it effectively, in that the Paymaster-General will not agree to settlements over£6 a week.

Already the leading Civil Service union, led by Mr. Kendall, has said that it wants nothing to do with this policy. He has said that he will take his opposition to the Trades Union Congress.

My point, therefore, is that this is a statutory policy and that it is really playing with words to claim that it is not. Indeed, in the White Paper the Government make clear not only that they have the sanctions I have already mentioned but that they have the reserve powers referred to in paragraphs 22 and 26 of the White Paper.

In paragraph 25 the Government say: If however they find that the policy needs to be enforced by applying a legal power of compulsion they will not hesitate to do this. 26. Legislation has therefore been prepared". 10.30 p.m.

We can no longer say that it is an open secret, because "secret" implies that something is hidden. The Government have not hidden this. The Prime Minister at his Press conference, announcing the policy, blurted out—I am sure quite deliberately—that there were reserve powers. Indeed, the reserve powers have been leaked to the Press. On Friday and Saturday of last week The Guardian —when it comes to the accuracy of leaks concerning this Government, I trust The Guardian—virtually had the Bill in draft. Today it referred again to the reserve powers.

The Government seem to have in mind that if an employer pays or arrives at a settlement in excess of£6 a week, he will be liable to a fine of£400 on summary conviction, or to a limitless fine on indictment. Is that the major reserve power that the Government have in mind? Those were the penalties in the 1973 Act and in the Labour Government's previous attempt at an incomes policy in 1966.

If that is what the Government have in mind, will the Secretary of State express it clearly tonight? Will he tell us what the reserve powers are? So far, the Government and the Prime Minister have been very coy about this matter. The White Paper states that Legislation has therefore been prepared". That was three weeks ago, but we have not seen it. I am sure that there is no hold-up in the printing.

Mr. Patrick Cormack (Staffordshire, South-West)

Ministers have not seen it.

Mr. Baker

I suspect that Ministers have seen it, but that they are not entirely in agreement about it.

Mr. Cormack

Is my hon. Friend aware that the other night some Ministers said that they had not seen it?

Mr. Baker

I do not know the levels of consultation which operate within the Government and the Labour Party.

The Government are on record as saying that legislation has been prepared. Therefore, this is an opportunity for the Secretary of State to tell us what that legislation contains. I should have thought that he owed it to the country to do that.

The argument by Ministers has been that this legislation should not be revealed because it would endanger the success of the policy. That point was mentioned by the hon. Member for Liverpool, Walton (Mr. Heffer) in his first contribution on new Clause 1, when he made his position clear. He wants no truck with statutory policies whatsoever, because, having embarked upon this path, we then get statutory powers and legal sanctions which bite. But the Government are on that path and the Secretary of State is reluctant to admit it.

On Thursday and Friday last week the Secretary of State was, in effect, saying: "Give me sufficient scope under Clause 1(5) and somehow I shall steer the ship through the next year. I shall be able to make deals down the road with various groups of employees and trade unions. I shall get their co-operation." The right hon. Gentleman failed to get that cooperation last year, because that was the bill of fare that we were being asked to buy a year ago. It was then called the social contract, the whole essence of which was, "We understand the unions and the unions understand us. Therefore, we will be able to do deals with them to the benefit of the country."

It is fair to say that the Government kept their side of that contract. They produced a whole series of Bills which improved and enhanced the status and power of the trade unions. But the trade unions did not deliver their side of the deal. They did not undertake any form of incomes restraint.

Mr. Deputy Speaker (Mr. George Thomas)

Order. I am sorry to interrupt the hon. Gentleman, but he must advance the case for his new clause. We have enough to do without going back over last Thursday and Friday.

Mr. Baker

You anticipated me by just a sentence or two, Mr. Deputy Speaker.

The Government should say exactly where they stand, and this new clause probes their intentions. The first part of the new clause incorporates most of the Government's proposals in their reserve powers Bill. We go a little further by saying that if the Government are to introduce legal sanctions on employers, they should be even-handed and ensure that sanctions will also operate on trade unions that call, promote, support or incite a strike the purpose of which is to obtain a settlement above£6 per week.

I have no doubt that when we discuss that item, the official whip of the Patronage Secretary will coincide with the unofficial whip of the hon. Member for Bethnal Green and Bow (Mr. Mikardo)—a sort of Patronage Secretary in exile. Even hon. Members below the Gangway will agree they do not favour this suggestion.

Mr. J. Enoch Powell (Down, South)

I am much obliged to the hon. Gentleman for giving way. He has indicated that his new clause gives body and effect to what is in the White Paper in outline about the reserve powers Bill. There is, however, one point in the White Paper to which he has not referred and, since it will not have escaped his attention, that must be deliberate. I refer to the words: if applied in particular cases in paragraph 26. They are very significant words, since they mean that the reserve powers Bill would not bite unless applied by order to particular cases—and precedent indicates that such orders would be very few and far between. Unlike the hon. Gentleman's new clause, it is very likely that the Bill of the Government would be, and would be intended to be, a brutum fulmen.

Mr. Baker

My right hon. Friend, with his usual perception, is absolutely right. This makes the whole nature of the enforcement powers which the Government have in mind even more difficult to understand. The phrase quoted by my right hon. Friend means exactly what he said. There would have to be specific orders dealing with particular cases rather than with the generality of cases.

The purpose of this short debate is to give the Government the opportunity to say exactly what they have in mind about these reserve powers. They should clear the air and be frank with the people in the trade unions and business who will be operating this policy, and tell us how it will affect individual wage negotiations.

Mr. Heffer

I shall not keep the House for very long. This is undoubtedly a mischievous new clause. The hon. Member for St. Marylebone (Mr. Baker) is suggesting that he already knows what is in the mind of the Government in relation to the reserve powers. I have had arguments with my right hon. Friends, as everybody knows, but I am quite sure that if anything of this kind was being suggested, about half the members of the Government would walk out. If they did not, I would be very surprised because, apart from anything else, the new clause is a resurrection of the Industrial Relations Act. In fact, it goes even further than that.

We have had the vicious suggestion, which I hope will be noted by the ordinary people and the trade unions of this country, that not ony should a striker not receive supplementary benefit for himself—that is all right, it does not happen now anyway—but that no benefit should be payable to his dependants for the duration of any action. It is now proposed that the wild arguments of a tiny minority of what I would call crackpots on the Opposition benches should be embodied into our legislation. This suggestion is being seriously put forward in the form of a new clause. I am not surprised that the Opposition Front Bench has not accepted the proposal on an official basis. It would be mad to do so. The clause, however, indicates where the so-called moderates of the Tory Party stand. The hon. Member for St. Marylebone is a so-called moderate in his party. But this is what I would call mindless moderation.

Under the proposal the dependants—the wives and children—of those involved in strike action would not receive supplementary benefit. There is also provision for a fine of£400 on summary conviction or an unlimited fine on indictment. All this is applied to working-class people who might be involved in strike action against the policy. This is vicious class politics of the type we experienced in the Industrial Relations Act. I hope that the whole nation will understand that the idea has been put forward as a serious amendment to the policy. I cannot believe that my right hon. Friend will contemplate any nonsense of this kind. The hon. Member was certainly right when he suggested that the Government Front Bench and my hon. Friends and I below the Gangway will be united in our determination to vote this clause down, if there is a vote.

Mr. Nigel Lawson (Blaby)

It is a probing amendment.

Mr. Heffer

The hon. Member says that it is a probing amendment. The Conservatives do not even have the guts to fight for their own policy because they dare not vote for such proposals. That is simply dishonourable.

Mr. Leon Brittan (Cleveland and Whitby)

It was fascinating to hear the interesting speech by the hon. Member for Liverpool, Walton (Mr. Heffer). It was no doubt a dummy run for the speech that he will make in opposition to the next phase of the Government's policy.

A form of statutory incomes policy is necessary today not because that would, of itself, solve our problems, or even because it might make a significant contribution to their solution, but because without one it would be impossible to obtain the necessary political support for the fiscal and monetary measures that are necessary to deal with the situation.

If the policy is to work, even in a limited sense, it must fulfil three criteria. It must be fair, firm and honest. The clause is designed to make the policy propounded by the Government conform to all three requirements. Last week there was some criticism of the Opposition for giving general support to the Bill but for being critical of it in detail. That approach was entirely legitimate because in its unamended form the Bill was open to the severest criticism of detail—criticism which arose not because of an accident in the way in which it was drafted or put before the House, but because it was fundamentally unfair.

Mr. Deputy Speaker (Mr. George Thomas)

Order, The hon. Member is pursuing a Second Reading argument. He must address himself to the new clause.

10.45 p.m.

Mr. Brittan

Like the hon. Member for St. Marylebone (Mr. Baker), I was leading, by a sentence only, into it. The policy in the Bill, without the addition of the amendment we are supporting, is unfair, unfirm and dishonest, because it is a statutory policy masquerading as a voluntary one. That was the direct cause of the deficiencies in the policy that this clause is designed to remedy.

The clause remedies those defects, first of all, by establishing the firmness of the policy by the clear provision of a form of sanction in the case of failure to comply with it—a form of sanction which has been completely misunderstood by the hon. Member for Liverpool, Walton (Mr. Heffer), because it is not provocative. The clause deliberately avoids any question of sending trade unionists to prison or anything of that kind. It confines its sanction, in so far as it applies to trade unions, to a financial provision—the imposition of fines on trade unions and not on trade unionists, still less on sending anyone to prison.

It is fair because it adds an element of fairness to the Bill by being equal-handed to employers and employees, both by imposing equal penalties on employers and employees and also by removing from employers the burden of being the sole repositories of responsibility for compliance with the policy.

By adopting the further meaures set out in subsection (3) of the new clause, one is only following the parallel to which my hon. Friend the Member for St. Marylebone has already referred in the White Paper—a parallel of indirect sanctions which are imposed by means of the Price Code, it is true, but which are for all that very severe when an increase in pay can be wholly disallowed under the Price Code, and not merely that element in the increase in pay which is in excess of what is permitted under the policy.

Therefore, there is no new principle in imposing the idea of supplementary benefit not being available to those who seek to act in contravention of the policy. Nor is there any new principle in removing the protection of Section 13 of the Tarde Union and Labour Relations Act for those who engage in such industrial action. Surely an employer who is faced with a strike in favour of a pay increase that is in flat contradiction to the Government's policy should not have to stand idly by while those responsible for inducing breach of contract in furtherance of that industrial action are clothed in the protection of the Trade Union and Labour Relations Act. The removal of that protection is an exact parallel to the indirect sanctions that already exist. Therefore, I support my hon. Friend the Member for St. Marylebone and believe that the addition of this new clause to the Bill would achieve the desirable effect of making the Government's policy, above all, more honest by removing the cloak of hypocrisy and subterfuge that has surrounded it until now.

The clause would make their policy firmer by giving it extra strength and, above all, it would make it fairer by applying it equally to employees and to employers, to unions and to employers' organisations.

Mr. Martin Flannery (Sheffield, Hillsborough)

I do not think that our people have the faintest knowledge of the Draconic attitude that many Conservative Members display when the barriers are removed for a few minutes. The iniquities of the Industrial Relations Act, as my hon. Friend the Member for Liverpool, Walton (Mr. Heffer) has said, show precisely the mentality of those people who brought forward that Act and who tried to carry out the terrible measures within it.

The Conservatives constantly tell us that they are against strike action. I can imagine nothing that would provoke strike action more determinedly, if it were cold-bloodedly planned, than this amendment. Subsection (3) of the new clause says, in relation to any employee striking, that no payment of supplementary benefit should be made to him or his dependants for the duration of the action. That is precisely what happened before, and here it is again.

I am bound to say, in justice to Opposition Members—one tries to be just to them now and again—that this is a natural concomitant of the approval of the White Paper. This is precisely the inevitable result of the approval of the White Paper. Some Opposition Members were bound, as soon as the opportunity arose, to try to discipline working people who are striving to make an honourable living.

As I looked at this matter, one of the things that struck me was that when talking of wage increases of 30 per cent., and when price increases of 25 per cent. have been taking place and rent increases were due, all this means that in order to live at the same standard as they have been living for some years, people were bound to do the kind of things which are condemned in the new clause. People will struggle to maintain the standard of living they have had over the last few years. The White Paper itself invites Draconian measures, and inevitably the attempt to have a statutory policy will be forced upon us.

Mr. Deputy Speaker

Order. The hon. Gentleman is very ingenious, but he is also wandering beyond the terms of the amendment.

Mr. Flannery

I was about to conclude, Mr. Deputy Speaker, by saying what I said earlier. [Interruption.] I am always honoured when Conservative Members want Labour Members to conclude. It usually means that we are not boring them but are saying something pertinent.

If the amendment were accepted it would introduce something which would cause more strife in this country than we have seen for many a long day, and more strife than the White Paper will produce anyway.

Mr. David Crouch (Canterbury)

I may have misled the Chair the other night when I touched on this subject in the very small hours of the morning, because then I held a view that I no longer hold. What is the point of having 24 hours of debate if it does not sink in? I am one of those who tend to come to the Chamber sometimes to listen and not just to catch the eye of the Chair. I did listen. On that occasion I tried to persuade the Secretary of State to disclose what was meant by the reserve powers mentioned in the White Paper. I must tell my hon. Friend the Member for St. Marylebone (Mr. Baker), who moved the new clause so eloquently, that I have come to the conclusion that to work on the question of the disclosure of those reserve powers is perhaps not in the best interests, not of this Bill— which I do not think much of—but of the whole process of trying to get some success in attacking inflation. It could be counter-productive.

There are many lawyers around me. They are always welcome. There is much humour, even from non-lawyers, when I make such remarks. But this is something which could even be called "moderate" by Labour Members—whatever that may mean. The new clause, ingenious as it is, could be counterproductive. It was moved very eloquently, and in other circumstances or another climate in Britain, I should feel inclined to support it. There is nothing wrong in it.

I do not agree with the hon. Member for Sheffield, Hillsborough (Mr. Flannery) that it is conducive to producing strikes. One cannot argue what has been put forward in the new clause except on the basis that we are considering tonight something that we were not considering the other night. namely producing good law. We are trying to produce a situation in which we could move out of the impasse in which we have been for so long—the impasse of trying to get some agreement on both sides of the House and between all the various parties about working together in order to break free from the situation in which some people, particularly, in this case, trade unionists, feel that they are being worked against by any piece of legislation.

The modification in the new clause is a good idea. Of course it is not wrong that we should be asking trade unions to bear some responsibility and carry some of the burden which now has to be carried by the employers. But I have learnt in the past few days that perhaps in all the circumstances it would be wiser to pursue the main objective of seeking co-operation.

The Secretary of State is trying to do that. I do not want to pour cold water on the fact that he is still trying to do a deal with the unions, still trying to get a contract out of them. After such a moderate speech as mine, he will be judged in the next year, during which the Bill will run, if he does not succeed. Let us give him time. It is a long time.

The amendment, reasonable and sensible as it is, could be counter-productive. My hon. Friend the Member for St. Marylebone, who moved it so well, said that there were some hon. Members who, he sensed, wanted no truck with statutory powers. He pointed to below the Gangway on the Government side of the House, but he could have found some above and below the Gangway on this side as well. For us to try to construct a Bill with the evidence of statutory powers about it would be counter-productive. It might satisfy some of our consciences. We might say that it was better law, but we should not have a better situation in the country as a result.

I commend my hon. Friend for having moved the clause so eloquently, and having argued it so well, supported by my hon. Friend the Member for Cleveland and Whitby (Mr. Brittan), but I am glad that he said that it was moved to find out some more from the Secretary of State. However, I do not think that we shall find out anything more from the right hon. Gentleman. I do not want to provoke him into a 65-minute speech, and he might be out of order if he tried to make one. Anyway, I am sure that he does not need that amount of time. He has been asked to clear the air and say what he means. I do not want to press him too much on that, and I do not know whether he can do it. We are dealing not so much with a Bill as with the mystery of achieving a unity in this country. We must go along with that.

Mr. Sydney Bidwell (Ealing, Southall)

The House much respects the sincere contributions that are usually made by the hon. Member for Canterbury (Mr. Crouch), but on this occasion his speech has fitted in very much with the mischievous way in which the proposal in the new clause was made by the hon. Member for St. Marylebone (Mr. Baker). It is unreasonable, mischievous and hiehly dangerous, and, notwithstanding the midnight frolic atmosphere into which we shall be moving ere long, it needs to be rejected and thoroughly denounced.

But my right hon. Friend the Secretary of State should pay attention to it. In a sense, it assists him greatly with his idea that we shall achieve success only in so far as we can maintain the understanding between free trade unionism in Britain and the Labour Government. I know that that is exactly what he is dedicated to.

I made a contribution to the debate at 6 o'clock in the morning on Friday, in which I said that I well understood that he stood on this ground—

Mr. Deputy Speaker

Order. We all remember the speech made by the hon. Member. However, we are now discussing new Clause 6.

11.0 p.m.

Mr. Bidwell

That was a remarkable speech, although I may be the only person who remembers it.

This proposal is highly dangerous. Many workers will pay heed to what we are doing. It is proposed that if employees decide, as a result of an injustice, to fight their employer, either by means of a strike or unusual working arrangements, their dependants will be starved into submission, so that the employees must submit to the will of the employers.

Even the right hon. Member for Leeds, North-East (Sir K. Joseph), who put forward the concept of the four socioeconomic classes, and who made an abortive bid for the leadership of the Tory Party, consistently resisted, even when the Tory Party were in power, the concept that dependent relatives of workers who felt obliged to demonstrate against their employers should suffer. The right to demonstrate is an article of considerable importance within our democratic system. That is the difference between free trade unionism and the trade unionism in totalitarian States. That is the road favoured by the lesser fraternity among the Opposition. I hope that the necessary lessons will be learned.

Mr. David Price

If this new clause is pressed to a Division I shall be in the same Lobby as the hon. Member for Liverpool, Walton (Mr. Heffer), the hon. Member for Sheffield, Hillsborough (Mr. Flannery) and the hon. Member for Ealing, Southall (Mr. Bidwell).

During the debate on the White Paper I expressed a great deal of scepticism about the analysis behind the Government's counter-inflation policy.

I do not believe that the intentions of my hon. Friend the Member for St. Marylebone (Mr. Baker) are serious. His purpose in putting down this new clause is that of the ferret going into the warren of Government secrecy to flush out the rabbit of reserve powers. Hence, part of the title of the new clause is "Legal sanctions".

On various occasions during the past two weeks I have attempted to bring this matter to the notice of the Secretary of State, the Prime Minister and the Chancellor of the Exchequer.

On 21st July the Chancellor of the Exchequer gave a brief synopsis of what the Government had in mind for these reserve legal sanctions. The next day the Prime Minister refused to tell us anything more, or to spell it out in any more detail. He said that the Chancellor of the Exchequer: has told the House as much as any Government can about legislation which we hope we shall not have to bring in."—[Official Report, 22nd July 1975; Vol. 896, c. 329.] I share that hope.

This is the intervention which I have not been able to get on the record. At his Press conference on 11th July the Prime Minister was asked: On those statutory powers, can we be told, Mr. Wilson, that the Bill will be published at least, so that we know what powers are going to be, even if it is not going to be taken through Parliament?"— to which the Prime Minister replied: Yes, that will be published. My whole purpose in attempting to intervene, as I tried to do last week and earlier this week, was to ask the Prime Minister, or the Secretary of State on his behalf, when the reserve powers will be published. The Prime Minister put it on record that they will be published. He said that to the Press, and not in the House. Anyone can go to the Library and get a synopsis of that Press conference. That is my short point, and that I see that as the sole purpose of the new clause. That is why I call it a ferret clause.

Several Hon. Members


Mr. Deputy Speaker

Order. It will save me from continually having to interrupt if hon. Members will remember that we discussed the point raised by the hon. Member for Eastleigh (Mr. Price) for many hours in Committee on Thursday night. We may not have had the answer, but we discussed it, and we must tonight discuss the proposal in the new clause.

Mr. Mark Carlisle (Runcorn)

As this is the first time I have intervened in the debate, I have not so far taken up much of the time of the House. I intervene only because, unlike the hon. Members for Liverpool, Walton (Mr. Heffer) and Sheffield, Hillsborough (Mr. Flannery), I do not believe the new clause is either mischievous or dangerous. It is a sensible clause, and the speech made by my hon. Friend the Member for St. Marylelone (Mr. Baker) in introducing it needed to be made. It is realistic to face the situation in which the Government find themselves, and one of the advantages of the clause is that it gives an opportunity to the Secretary of State to say something about the reserve powers he has in mind.

We are debating a statutory policy. None of the mental acrobatics of the Secretary of State can avoid that. Everyone outside the House knows that we are debating a statutory policy. Many hon. Members on both sides of the House may regret that we are debating a statutory policy, but that is the situation. It has been shown over the last 12 months under the social contract—regrettably to those who would prefer to see a voluntary incomes policy—that self-discipline has proved to be inadequate.

I believe that the Government are right to bring forward the White Paper. They are moving down the right path. But I regret that they should make clear in the White Paper that they have reserve powers ready but are unprepared to tell Parliament what those reserve powers are.

One of my hon. Friends suggested that it had been said that Ministers had not seen that legislation. I find that extraordinary. Paragraph 26 of the White Paper reads: Legislation has therefore been prepared which, if applied in particular cases, would make it illegal for the employer to exceed the pay limit. I cannot believe that that White Paper has been approved by the Cabinet, as it must have been, without the members of the Cabinet being aware of the powers in the legislation which the Government say they are in a position to introduce. It is right that the Minister should be given the opportunity on the clause to state what those powers are.

The right hon. Member for Down, South (Mr. Powell) pointed out that under the proposals in the White Paper those powers would be implemented only in individual cases by order. If so, that is all the more reason for the Government to tell Parliament what those powers are in general principle. When the hon. Member for Liverpool, Walton says that those powers are nowhere near like those contained in the first part of the new clause, I would point out that the clause is taken not only from the previous counter-inflation legislation of the previous Conservative Government but, equally, from the Bill published by the Labour Government in 1966.

My second point is that the White Paper implies, as have the statements of the Prime Minister and the Secretary of State, that the reserve powers the Government have in mind will act only against employers. Surely, realistically, that must be nonsense. It cannot be right to introduce sanctions which will make it an offence for an employer to give in to pressure to pay more than the maximum permitted increase, but at the same time to place no sanctions on unions which encourage, finance and support strikes.

Mr. Biffen

My hon. and learned Friend has drawn a distinction between the point made by the right hon. Member for Down, South (Mr. Powell) that the Government were clearly intending to proceed by order, and the clause to which he has appended his name, which does not foresee that facility. Will my hon. and learned Friend tell us who will be the prosecuting agent?

Mr. Carlisle

I accept that the clause does not foresee the idea of proceeding by order. The point I was making is that if, as the right hon. Member for Down, South (Mr. Powell) points out, the Government will be required to proceed by order to enforce their powers, the more reason to inform the House now what those powers will be. Presumably, under the provisions of the Bill as it stands, the Secretary of State could be the party to start the proceedings against anyone who breaches the limit imposed by the White paper.

I return to my second point. It is surely wrong that any reserve powers should produce sanctions only against employers and not against trade unions. It seems to be nonsense to have a situation in which it would be an offence to give in to pressure to pay more than the limit, without any form of sanction applying against those who encourage the pressure to be imposed. That is rather like saying that blackmail shall no longer be an offence, but that it shall be an offence to give in to blackmail.

I believe that any sanctions that are introduced—I regret that I believe sanctions will be necessary must deal not only with the rogue employer, as the Prime Minister has said, but with the rogue trade union. That must be so if this policy is to have the support of the CBI as well as the TUC. It is important that there should be equal powers against both unions and employers. For that reason I support the clause.

Mr. Robert Adley (Christchurch and Lymington)

I have studied the new clause carefully, and on balance I too would like to support it. The Secretary of State may recall my only other intervention in this debate and may recall that I am basically sympathetic to what the Government are trying to do, but there must be some limit to the good will which the House can extend to the Secretary of State and the Government in the absence of any firm proposals.

The Secretary of State at Question Time today, in answer to a Question put by myself, merely shrugged his shoulders and said "We hope that the situation never arises." I believe that we have some responsibility to probe the Secretary of State's mind a little further, and to find out from him just how far even he is prepared to go before even he feels that some positive action to control inflation has to be undertaken.

I believe that the new clause would make it a great deal easier for the overwhelming responsible majority of trade unions and employers to comply with what the Government are trying to do. I happen to believe it is unfair and unrealistic to expect the TUC or the CBI to act as unpaid policemen for the Government—policemen without any knowledge of the law they are trying to enforce.

11.15 p.m.

The clause could have the advantage of helping the Government to spare the rod and thus to spoil the child. I hope the Secretary of State will give serious consideration to the intent behind it. When I listened to the hon. Members for Liverpool, Walton (Mr. Heffer), Sheffield, Hillsborough (Mr. Flannery) and Ealing, Southall (Mr. Bidwell), all members of the Tribune Group, chastising my hon. Friend the Member for St. Marylebone (Mr. Baker) and others who have supported the clause as "immoderate extremists", I can only say that the House will be able to judge out of whose mouths those accusations come.

There have been accusations that the new clause seeks to perpetuate what the hon. Member for Liverpool, Walton calls violent class warfare. It leads me to think that the hon. Gentleman is out of touch with the majority of ordinary working people—[Interruption.] It may surprise certain hon. Members opposite to know that the entire working population does not comprise militant shop stewards.

The hon. Member for Ealing, Southall referred to this clause helping to create a totalitarian State in Britain, which State is not perhaps beyond the bounds of possibility. We have seen what has happened in Nigeria today; but when our Prime Minister leaves the country, as he does so often, it is not to the Opposition side of the House to which he will be looking; it is very much over his shoulder.

Mr. Deputy Speaker

I think the hon. Gentleman should leave Nigeria and seek to return to the subject of new Clause 6.

Mr. Adley

I accept your ruling, Mr. Deputy Speaker, but I suggest that if the powers that be had not wished this debate to take place, this clause would not have been selected for debate.

Mr. Deputy Speaker

I hope that the hon. Gentleman is not casting a reflection on the Chair. It is my responsibility to see that the hon. Gentleman keeps to the new clause.

Mr. Adley

I apologise to the Chair and wish to withdraw any implication of that sort.

Let me finish the point by saying that I wonder what the Secretary of State for Employment's reaction would have been if a Conservative Government had sought to bring before the House proposals such as these. Would he have swallowed them hook, line and sinker?

Many people in this House, and, indeed, millions of people in the country want the Government's counter-inflation policy to succeed. But the Secretary of State is relying on self-deception, which ultimately may cause confidence to collapse when reality has to be faced.

Mr. Tim Sainsbury (Hove)

If I seek to declare an interest, you might rule me out of order, Mr. Deputy Speaker. I also run the risk of being accused by my hon. Friend the Member for Eastleigh (Mr. Price) of lacking a serious purpose. I also run the risk of being accused of being immoderate. However, I hope that I shall be allowed to say a few words in support of the clause. My hon. Friend the Member for Cleveland and Whitby (Mr. Brittan) referred to this as a statutory policy masquerading as a voluntary one. The hon. Member for Ealing, Southall (Mr. Bidwell) spoke of midnight frolics. We have not yet got to that stage and such a statement is a little premature, but even after midnight it is pure masquerade. I regret that our discussion has tended to deal with semantics rather than with economics. I cannot believe that in industry there is anybody who takes the view that this policy is anything but statutory.

I support my hon. Friend the Member for St. Marylebone (Mr. Baker), who moved the clause so clearly by saying that the policy must be even-handed and fair. If there is any doubt whether we are discussing a statutory or a voluntary policy, it is all the more important that it should be seen to be even-handed and fair.

The hon. Member for Liverpool, Walton (Mr. Heffer) talked about the reaction of ordinary people to the clause. For my part, I have no doubt whatsoever that the ordinary people of this country would regard it as even-handed and fair that the burden of supporting this policy, be it voluntary or statutory, should fall on both sides of industry and not on one side alone.

The clause would make it quite clear that there was equal responsibility. We may find on both sides of the House, above and below the Gangway, across and in practically every direction one can devise, the occasional modest disagreement about the merits of statutory policies, but surely we can all agree on one thing if we are to have a policy it cannot be one that is statutory for some and voluntary for others. It is for that reason that I support the new clause.

Mr. David Lane (Cambridge)

My hon. Friend the Member for St. Marylebone (Mr. Baker) has argued persuasively in moving the new clause, and I support him in what my hon. Friend the Member for Eastleigh (Mr. Price) called a "flushing" operation.

The Chancellor of the Exchequer recently described the Government's policy as rough justice, but there is no need for it to be as rough as this. In moving this new clause we are trying to help him. The more I listen to the debate the more I fear that the Government have fumbled a great opportunity. Many of us inside and outside the House, who have been anxious to support the Government in a really effective attack on inflation in the national interest, now feel a sense of disappointment as we see Ministers unconvincing under cross-examination and as we listen to their verbal conjuring tricks in trying to conceal the divisions on the Labour benches and justify the non-disclosure of the reserve powers.

We have put down the new clause because, whereas the Government started earlier this month with brave words, they have produced a package that is still not properly shaped to command an overwhelming national response. It is still too biased and too partisan.

Consider, as some have already mentioned, the employers, who stand in the forefront of the attack, expected to advance through cannon from various directions, and to grin and bear the gratuitous rudeness of the Prime Minister in one or two of his recent speeches. Contrast that with the sacred cows which have to be kept out of the battle, the susceptibilities of the trade unions and the Government's obstinate attachment to parts of its total programme, such as the excessive public spending and the continuing nationalisation. In all this, where is the element of fairness that is so essential?

I am no enthusiast for a statutory apparatus. I accept it reluctantly as a last resort, but, if we are to get this hybrid package into a better and fairer shape, it is necessary to stiffen and strengthen it on some such lines as my hon. Friends have been arguing.

I end up by quoting some of the words from the conclusion of the White Paper, in paragraph 47: The Government seek the support of the nation in breaking the inflation which threatens our economy. That support would be more enthusiastically given if the burdens were more fairly shared. It is not too late for the Government to think again.

Mr. John Page (Harrow, West)

My hon. and learned Friend the Member for Runcorn (Mr. Carlisle), my hon. Friend the Member for Hove (Mr. Sainsbury) and other hon. Friends have said that they believe this is a statutory policy and that the Government know this. Though some members of the Government may know this, I believe the Secretary of State is not involving himself in the White Paper and the Bill, believing it to be a statutory prices and incomes policy, and that as soon as the secret Bill is introduced he will be flushed out or the Cabinet Room.

The right hon. Gentleman has been absolutely straight, and I believe that as far as he is concerned the White Paper and the Bill are a con trick. I think that a con trick is likely to work much better than a statutory prices and incomes policy.

Throughout these debates, the Secretary of State has reminded me of an old friend I used to meet when I went to race meetings. He was six feet tall, black, and wore a headdress of ostrich feathers. He was known as Prince Monolulu. In exchange for five bob he would take one's race card, hold it close to his eyes, mark it and whisper "Do what you are told and have a good day" That is exactly what the Secretary of State is telling the country, and, on the whole—[Interruption.] I know it would be unnatural for the Secretary of State to wear ostrich feathers.

In all seriousness, the right hon. Gentleman is trying to impress on people that this is a genuinely voluntary policy and that if they are decent chaps and good trade unionists they will not try to ask for more than£6, and that whether that is£6 maximum or£6 in the TUC guidelines, that is it.

The Minister might be inclined to accept subsection (3) of new Clause 6 because it is in no way statutory. It simply carries out what is in the White Paper, with which the right hon. Gentleman is in total agreement. This is a plan to save our country, and it is hardly conceivable that he or anybody else should think it sensible for the poor old taxpayer to pay out money for those who go on strike to get more than£6 if they break our country.

Last year£4.1 million was paid out to miners who went on strike—

Hon. Members

Their families.

Mr. Page

—and their families.

Hon. Members

Just their families.

Mr. Page

Slightly more for the families than for the miners, I admit.

I must not be razzled or ruffled, Mr. Deputy Speaker, by those who know and understand very well the truth of what I say. All I say to the Secretary of State, believing with him that he is determiner' that this should not be a statutory policy, is "Put in subsection (3)".

Mr. Biffen

With new Clause 6 is taken new Clause 8, in the names of my hon. Friend the Member for St. Maryle-Lawson), my hon and learned Friend the Member for Dover and Deal (Mr. Rees) and myself. Discussion, however, has properly concentrated on new Clause 6, and I think I should take my hon. Friends with me if I were to say that we should be happy if new Clause 8 were to settle beneath the waters. I shall address a few remarks to new Clause 6.

I have sat in close proximity to my hon. Friend the Member for Blaby (Mr. bone (Mr. Baker) for many months and I can authenticate the fact that he is one of the most hygienic people in the House of Commons. The analogy to a ferret therefore, is singularly inappropriate. There was something compelling about my hon. Friend's arguments, because one of the most disadvantageous features of the legislation is the idea that the Government are trying to rule not by law, as published and understood in all its clarity and universality, but by threat of what might be done.

It is those few words in the White Paper: Legislation has therefore been prepared which, if applied in particular cases, would make it illegal for the employer to exceed the pay limit. which have caused genuine pain and anxiety on both sides of the House and in the industrial and commercial world outside.

11.30 p.m.

I do not believe that we are doing other than a service to the concepts of the law if we try to bring some light and clarity where at the moment there is not only obscurity but the kind of dangerous obscurity that can be manipulated by those who have a vested interest in promoting the maximum of dislocation in the industrial and commercial field.

I turn briefly to the contents of the clause. Here I hope that my hon. Friend the Member for St. Marylebone will not be too downcast if I say that my enthusiasm is a shade muted. I have anxiety about the ease with which one reaches for legal sanctions whenever dealing with something as delicate as the determination of remuneration.

I want to make two small observations in the presence of such distinguished lawyers as my hon. Friends the Member for Cleveland (Mr. Brittan) and my hon, and learned Friend the Member for Runcorn. First, it is a conscious and deliberate policy that the operation of the sanctions shall not be made specific and unique to the Minister by way of order but presumably is to be left for a much wider interpretation. We will find that there will be sufficient complications in the execution of this policy without the assistance of Mr. Norris McWhirter.

I say to those of my hon. Friends who think that they may be promoting some kind of social reconciliation—they were all very self-conscious moderates when speaking earlier—that this could contain dynamite unless it has been carefully considered in all its ramifications.

My other and closing comment to my hon. Friends, who I am sure have a deep sense of history is "Never forget Betteshanger". One should never get oneself into the position—unintended, I am sure it will be—when one finds that what started as a dispute over remuneration gets put into a totally different context and is manipulated—I see the hon. Member for South Ayrshire (Mr. Sillars) nodding his head; I am thinking of the difficulties which could arise in Scotland—by those who are determined to inflate this conflict into something of far greater magnitude than it could possess in the form of a mere industrial dispute. We have here the makings of a Trotskyite charter. Much as I admire the desire to give sanction and force to any law that we enact, for heaven's sake let us proceed carefully.

Mr. Ridley

I apologise to my hon. Friend the Member for St. Marylebone (Mr. Baker) for missing the beginning of this debate and for not hearing his speech, but I thought that with his great competence he would need no assistance from me. Hon. Members can imagine how horrified I was on coming into the Chamber to hear him called a ferret, an extremist and an immoderate, and to hear him being talked about as flushing out the Government. Every sort of obloquy was hurled at my hon. Friend.

I wish merely to seek to come to my hon. Friend's assistance by pointing to the fact that on the Amendment Paper and taken with this new clause is new Clause 8 which should have been down in my name but for a printer's error. I do not know whether the printer is seeking to save me from myself or whether something more sinister is to be read into the fact that my name no longer appears among those who support the clause. I promise the House that it was I who drafted it and tabled it.

New Clause 8 seeks to remove all criminal sanctions from the whole of the policy, both against employers and against trade unions. Judging by what I have heard of the debate, this is exactly what all hon. Members want. My hon. Friends on the Front Bench are against a statutory policy and in favour of a voluntary policy. Hon. Members below the Gangway opposite are against criminal sanctions against workers. Very few of my hon. Friends have spoken up for the full-blooded rigour of the law being used in this matter.

Perhaps I can come to my hon. Friend's assistance. Instead of new Clause 6 perhaps we should press new Clause 8, which would remove all criminal sanctions from the policy. This is in accordance with Government as well as Opposition thinking. Time and again, the Secretary of State for Employment has come wearily to the Dispatch Box and said, "This is a voluntary policy". Therefore, presumably he will accept the new clause, too.

Section 17 of the Counter-Inflation Act contains the horrible words

  1. "(a) on summary conviction to a fine not exceeding£400, and
  2. (b) on conviction on indictment to a fine".
It is those words which chill the hearts of all hon. Members who seek to invent prices and incomes policies; and those who remember the great coal industry strike of 1973–74 will know that it is those words which cause the difficulty.

Therefore, I hope that, if we are to remove the sanctions from trade unions and working people, we shall also remove them from employers who do no more than seek to make their businesses prosper and to produce the goods we need. A policy which includes criminal sanctions against them is just as offensive as a policy which includes criminal sanctions against working people and trade unions. I hope that I have helped the debate by suggesting that perhaps the House would prefer to accept new Clause 8, which takes out of politics the question whether the policy should be statutory or voluntary.

Mr. Lawson

In this competition among the moderates, may I put forward a modest claim to be the most moderate hon. Member of all? For I am the only person whose name is attached both to new Clause 6 and to new Clause 8. I display my moderation in the same way that Government Whips display their moderation when voting in both Lobbies in a Division.

I acted wittingly, and I was glad to have my name added to the new clause proposed so ably by my hon. Friend the Member for St. Marylebone (Mr. Baker). For it does not propose that there should be a statutory policy even more statutory than the policy we have now; it is intended to flush out the intentions behind the reserve power provisions of the White Paper.

I have never supported a statutory policy. I confess I have never heard, before, the ingenious argument put forward by my hon. Friend the Member for Cleveland and Whitby (Mr. Brittan) that although a statutory incomes policy had no effect on inflation, it was useful as a means of gaining popular support for other policies. Before I became a Member, I was a close observer of the political and economic scene, but I must say I have not noticed that the infallible way in which a Government might obtain popular support for their measures was to introduce a statutory prices and incomes policy. I am not convinced by that argument.

However, the Government have published a White Paper containing the reserve powers. I hope that they will not be used. Later we shall discuss Amendment No. 45, in the name of my right hon, and learned Friend the Member for Huntingdonshire (Sir D. Renton) which, in effect, proposes the deletion of various provisions, including the provisions relating to the reserve powers. Therefore, perhaps the Secretary of State will in due course please us by accepting Amendment No. 45. But until then the reserve powers are in.

We want to know, therefore, whether subsection (1) of new Clause 6 is in the draft reserve powers Bill. I believe it is. Subsection (2) may be unwise, but, as my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) said, it is no more unwise than would be a similar sanction on employers. How the hon. Member for Liverpool, Walton (Mr. Heffer) can say that a penalty on powerful trade unions precisely equal to that on employers is vicious class legislation passes belief.

Subsection (3) concerns the payment or non-payment of supplementary benefit. We have heard some disturbing things, particularly from the hon. Member for Ealing, Southall (Mr. Bidwell). He said that we were suggesting that the dependants of strikers should starve. That is an astonishing and terrible suggestion. It is a suggestion that the trade unions con- cerned would refuse to pay strike benefit. I am sure that the hon. Gentleman did not mean that.

The hon. Gentleman also suggested that if a trade union had no strike fund from which it could pay strike benefit, the TUC, which we have been told is the fount of all wisdom, charity and compassion, would not come to its aid by giving money to enable it to pay strike benefit. I am sure that on reflection the hon. Gentleman will see that he has been traducing the trade union movement by suggesting that the effect of this proposal would cause the dependants of those on strike to starve.

We are suggesting a step towards a system which is closer to that of every other civilised country in the world. No other civilised country pays benefit to strikers and their families in the way that we do. This is a matter about which the vast majority of people in this country feel very unhappy.

Mr. Bidwell

I am grateful to the hon. Gentleman for giving way, as he has referred to me, because I did not give way to him.

Mr. Lawson

That is right.

Mr. Bidwell

I wanted to keep my speech short. State aid is not paid to strikers.

Mr. John Page

My hon. Friend referred to families.

Mr Bidwell

The hon. Gentleman will see, when he reads Hansard tomorrow, that the hon. Member for Blady (Mr. Lawson) referred to strikers and their dependants.

Mr. Lawson

It is not my job to point out the hon. Gentleman's errors. However, the fact of the matter is that strikers' families have benefits as of right. Strikers may be given benefits on a discretionary basis. If the hon. Gentleman cares to put down a Question to the Secretary of State for Social Services he will find the position is as I have outlined.

Mr. J. Grimond (Orkney and Shetland)

As the hon. Gentleman is one of the signatories to this and many other new clauses, will he confirm that he proposes to withdraw the benefit only from strikers who are striking not against em- ployers but against the Government's policy?

Mr. Lawson

That is the effect of the new clause. It is by no means perfectly drafted, but perfection is rare in this world. Often we must be content with second best.

Finally, I should like to draw the attention of the House to an important constitutional innovation which we have had over the reserve powers Bill. The new clause is really part of this constitutional innovation, and as such it is important.

During our long debates on this whole matter we have had the reserve powers Bill not published, but brandished, to use the right hon. Gentleman's word, and that brandished Bill has been amended. This is an extraordinary situation. Although the Bill has not been published, it has imperceptibly, but certainly, been amended.

Mr. Cormack

It is the only thing which has been amended.

Mr. Lawson

It is indeed. The Bill was originally to be retrospective. It was to come into force immediately it was published, not when it received the Royal Assent. Later in the course of this process of amendment we were told by the Secretary of State for Employment that the position had been "clarified" and that what the Chancellor of the Exchequer had said earlier no longer held. That was a process of amendment which we had undertaken.

Again, there has been an amendment to this unpublished Bill on the question of what would happen if there were a case of contempt of court. Hon. Gentlemen on the Government benches will recall that discussion. The' Gevornment's position on that matter has changed and been amended.

New Clause 6 is important because it will further assist the process of amendment of an important Bill which has not yet been brought before the House.

11.45 p.m.

Mr. Foot

I am not sure that I am not guilty of intrusion by participating in this debate. I promise to do so only for a short time. The supporters of new Clause 8 have effectively answered the supporters of new Clause 6, so there is, very little for me to say. The only hon. Member to whom I would have to reply is the hon. Gentleman who confessed he had achieved the astonishing feat of supporting both clauses at the same time, thereby illustrating that he shares with the creature of Greek mythology the capacity to move in opposite directions at the same time. The process of combustion is going to happen at any moment and none of us would wish to interfere with it in any way. I hesitate to proceed any further with my speech, but out of natural courtesy I shall make one or two comments on what is proposed in these new clauses.

Leaving aside new Clause 8, if I can do that with courtesy—nobody has put any arguments in its favour.

Mr. Ridley

I did.

Mr. Foot

I beg the pardon of the hon. Member for Cirencester and Tewkesbury (Mr. Ridley). I take a Stow-on-the-Wold view of his two parts of the geography. He did support new Clause 8 on perfectly reasonable grounds. It would mean not only the abolition of penalties but the abolition of the Price Code altogether—not merely the Price Code as it would be invoked to make this policy possible.

This is a matter that should be discussed on another occasion. Obviously this is not very appropriate on this occasion. The hon. Gentleman is the only Member who has dared to support new Clause 8. I do not think I need to spend much time on it.

New Clause 6 has been described as a probing and ferreting clause. In my opinion, it could be better described as the industrial confrontation, chaos and general cock-up clause. I am not sure whether it is appropriate for me to use language of that nature, but I could not think of another word beginning with "c" that properly defined the clause and had the proper sense of peroration in it. It is not necessary to get as far as the miserable suggestion that we should rob strikers' dependants of their supplementary benefit. If the preceding subsection were applied, it would, as my hon. Friend for Liverpool, Walton (Mr. Heffer) rightly said, be a recipe for industrial chaos on a mammoth scale.

I do not believe there is a single hon. Member who will dare go into the Lobby to vote for this new clause. We shall soon see if my prophecy is correct. The House will not have to wait for more than a minute or two.

We were told that the reason the clause was tabled was to probe the Government's position about reserve powers. We have debated the reserve powers on various occasions and there may be future occasions in which they will be discussed, although I trust it will never be necessary for them to be brought to this House. I confirm however, that the reserve powers would never be used without them being presented to the House. The House of Commons has the right to decide these matters. I used the expression about brandishing Bills in the face of the country or Parliament. I am not in favour of that procedure. That is not the right way for us to proceed, just as it would not be right for us to use the process of presenting the threat of what might be done.

The position about the reserve powers is perfectly plain. The Chancellor of the Exchequer has made his statements on it. He has indicated what would not be in the reserve powers Bill, and it is important that people should understand that. My hon. Friend the Member for Liverpool, Walton raised certain questions in that respect, and it is therefore important that hon. Members should understand this point, too. The most essential fact about the reserve powers Bill, about which there has been so much talk—I advise hon. Members on both sides of the House, particularly the Opposition Front Bench, to take no notice of anything they may read in The Guardian, The Times or anywhere else about what might be in the reserve powers Bill—is that the powers of this Parliament over that Bill remain absolute.

This Parliament will decide whether that Bill, in any form, is ever translated into action. That is the way it should be. I am therefore against brandishing measures of that kind which are not presented to Parliament. Since the power of Parliament in this respect remains absolute, it is unnecessary for hon. Members to use probing or ferreting clauses to find out the simple fact that I have stated on at least six occasions. If I said it again I would doubtless be pulled up by you, Mr. Speaker, for tedious repetition.

I therefore challenge the Opposition to go into the Lobby to vote for the rubbish that they have put before us tonight at this hour.

Mr. Baker

I wish to thank most of my hon. Friends who spoke to this clause for the kind words which they addressed to me. In spite of their kind words they will still be my friends. The purpose of the clause was to invite the Secretary of State to be more forthcoming. He owes it to the country to be rather more frank than he has been. My second purpose was to establish a marker, that if, or when legal sanctions have to be introduced there are many of us on the Government side who have said that they believe that they should be even-handed and not applied only to one side of the wage bargain.

Those were the purposes of this short but good debate. I believe that we have established our point, and therefore I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

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