Commons Sitting of 28 February 1977

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

    Portmadoc
    Mr. Ronald Atkinsasked the Secretary of State for Wales if he will pay an official visit to Portmadoc.
    The Under-Secretary of State for Wales (Mr. Barry Jones): My right hon. and learned Friend has no immediate plans to do so.
    Mr. Atkins:>Is my hon. Friend aware that, if he goes there, the best way is by the Cambrian Coast Railway, which links together the communities of West Wales and could link with the North once the Blaenau Ffestiniog line is joined to it, far better than any remote Parliament in Cardiff, which is remote partly because the line between the West Coast and the South was closed? Will my hon. Friend
    2
    ensure that no further rail services are closed?
    Mr. Barry Jones: There are no proposals before the Government to close the Cambrian Coast line or any other railway line in Wales. My hon. Friend mentioned the Blaenau Ffestiniog railway. From the coast almost to Blaenau itself, some £279,000 in various grants has been given or is on offer.
    Mr. Wigley: If the Secretary of State has an opportunity to go to Portmadoc, we hope that he will then be confirming the future viability of the Cambrian Coast line, but will he also take note of the need to improve the traffic flow in that area? In particular, what is the latest situation in relation to the legal inquiries that are being made relevant to the cob and tollgate at Portmadoc?
    Mr. Barry Jones: On the last point, counsel's opinion has now been obtained and we are considering the advice.

  Housing
  Mr. Wigleyasked the Secretary of State for Wales what steps he has taken, or proposes to take, to alleviate the housing position in those parts of Wales where there is a substantial waiting list for local authority housing, and where there is an increasing number of second homes that are empty for large parts of the year.
  The Under-Secretary of State for Wales (Mr. Alec Jones): It is for the local authority concerned to take such

  3
  steps as it may consider appropriate in these circumstances.
  Mr. Wigley: Is the Minister aware that in my area, the Arfon Borough Council area and the Dwyfor District Council area, a recent study has shown that there are more second homes than there are people on the housing waiting list, even though the waiting list for council housing is larger than the average in Wales? In those circumstances, will he listen to representations from these councils for specific and deliberate aid to try to allow them to buy more second homes when they come on to the market in order to meet the needs of the long waiting list for council housing?
  Mr. Alec Jones: I am sure the hon. Gentleman is aware that the measures that the Government have already taken, including withdrawing financial assistance towards second homes from public funds, the abolition of tax relief on second home mortgages and the abolition of improvement grants for second homes, have removed the worst of these features. We are always prepared to listen to problems. We have made a block allocation this time. It must be for councils to decide their own priorities within that block grant.
  Mr. Roderick: Will my hon. Friend make more funds available not only for the purchase by local authorities of second homes but for the purchase of any private homes when they come on to the market, to prevent them from becoming second homes?
  Mr. Alec Jones: I cannot comment on a hypothetical situation. If my hon. Friend has details of particular cases, I shall be glad to examine them.
  Mr. Grist: Does the hon. Gentleman agree that in order to alleviate the demand for accommodation, particularly in cities, there is a crying need for reform in the existing land laws?
  Mr. Alec Jones: The hon. Gentleman will be aware that these matters are now under review.

  Bronglais Hospital, Aberystwyth
  Mr. Geraint Howellsasked the Secretary of State for Wales if he has any plans to visit Bronglais Hospital, Aberystwyth.
  Mr. Barry Jones: I was at Bronglais last Friday.
  Mr. Howells: Is the Minister aware, as it was confirmed in writing to me some time ago, that as he has no plans to build the second phase at Bronglais Hospital many members of the staff and people in Mid-Wales in particular are worried about the future of this hospital? Is he aware that many believe that small cottage hospitals in Mid-Wales may be closed and that he ought not to concentrate all efforts on Carmarthen, Wrexham and elsewhere in the area?
  Mr. Barry Jones: Let me dispel that fear. In the decades ahead there will be a place in the strategy for Wales for the community hospital or cottage hospital. At Bronglais Hospital ideally there should be a phase two, but we are in difficult financial times and the advice that the area health authority gives is that it has a different order of priorities.
  Mr. Nicholas Edwards: As the Dyfed Area Health Authority receives almost the smallest allocation of resources per head of population in the United Kingdom, will the Under-Secretary examine urgently ways of correcting this situation so that the area health authority can meet the needs of the people that it serves?
  Mr. Barry Jones: The health authorities in Wales are on the point of reallocating their recources, in discussion with the Department and myself, and in the financial year ahead there may well be some changes. However, I would not want the hon. Gentleman to give the impression to the House or to Dyfed or anywhere else in Wales that Dyfed was receiving anything less than its fair share.
  Mr. D. E. Thomas: As Bronglais is one of the hospitals which serves the population in the southern part of Merioneth, may I congratulate the Secretary of State on his decision to invest more capital resources in the Wrexham area, which also serves Merioneth? In the future development of district general hospitals, will he ensure that the Welsh Office pays due regard to the effect of the centralisation of services on rural areas and that the ambulance service which serves those areas is developed and controlled locally rather than centralised in its communication network?
  Mr. Barry Jones: The hon. Gentleman might wish to write to me giving details of his views on the ambulance service.

  Local Authorities (Deputations)
  Sir A. Meyerasked the Secretary of State for Wales whether there has been any change in his policy as regards receiving deputations from local authorities in Wales.
  Mr. Alec Jones: No. Subject to limitations of time and parliamentary pressure we are always ready to receive deputations from local authorities, provided they seem likely to serve a useful purpose.
  Sir A. Meyer: Does the Minister recall the refusal of his Department to receive a deputation from the Delyn Borough Council to make representations on the consequences of recent flooding? Does he further recall the refusal of his right hon. and learned Friend to receive a deputation from Rhuddlan Borough Council in order to consult him on the financing of essential investment policy in the Rhyl tourist industry? Does he not think that these repeated refusals represent a regrettable departure from the precedent set by previous distinguished holders of his right hon. and learned Friend's office and that they give an impression of being uncaring, bureaucratic and remote?
  Mr. Alec Jones: On the latter subject, the hon. Member knows that I spoke to him and met him to discuss the financing of the Rhyl leisure centre and that the council was given full advice from the Welsh Office before making its decision to proceed in the way in which it wanted with this development. As for the refusal to see Delyn Borough Council about aid towards flooding on Deeside, my right hon. and learned Friend told the council that the responsibility for preparing remedial works lay with it and that the Minister responsible for approving and grant-aiding such schemes was the Minister of Agriculture. Therefore, no useful purpose would be served by meeting such a deputation, although officials from my office were prepared at all times to give the necessary advice.
  Mr. Wyn Roberts: In view of the Secretary of State's responsibility for the Welsh National Water Development Authority, which carries out the drainage
  6
  schemes that are necessary when flooding occurs, surely he has a responsibility here.
  Mr. Alec Jones: No, it is not fair to say that my right hon. and learned Friend is responsible for the details of these schemes, because the two schemes are not exactly similar. The flooding at Llandudno Junction arose from a main river and was the direct responsibility of the Welsh National Water Development Authority. It is because of that responsibility that the meeting was called at which the scheme has now been developed and drawn up.

  Llandudno and Conway
  Mr. Wyn Robertsasked the Secretary of State for Wales if he will visit the Llandudno-Conway area.
  The Secretary of State for Wales (Mr. John Morris): I shall be visiting Llandudno towards the end of May.
  Mr. Roberts: Is the right hon. and learned Gentleman aware that the unemployment of young people is a grave problem in that area and that there were 500 young people employed in Gwynedd last month, many of them having been without a job for a considerable time? Will he assure us that he will encourage all the authorities concerned to take every possible step to ensure that the work experience, job creation and community industry programmes are taken full advantage of?
  Mr. Morris: Certainly I would always give every encouragement to the take-up of those schemes. As regards the situation in the hon. Gentleman's own constituency, much as one deplores the levels of youth unemployment, there have been improvements. In Conway, 156 youths were unemployed on 12th August last year; the figure had fallen to 133 in January and to 115 on 10th February. The equivalent figures for Bangor were 148, 56 and 49. Of course, there is still more work to be done.
  Mr. D. E. Thomas: When the right hon. and learned Gentleman goes to Llandudno, will he at a particular roundabout turn left and take the A470 south through Blaenau Ffestiniog, which he last visited officially in April 1974? Going through it, will he stop and get out of his

  7
  official car so as to survey the now derelict site of the Blaenau Ffestiniog 50,000 sq. ft. advance factory—
  Mr. Speaker: Order. I let the hon. Member get so far, but I am worried that at any moment he will be inviting the Secretary of State to Tonypandy.
  Mr. Morris: Without transgressing the rules of order, I would say that the hon. Gentleman must know of the enormous efforts which have been made to get a tenant for the advance factory that he has in mind. He will also know that a substantial effort has been put into the clearing of derelict land.
  Mr. Kinnock: In any case, whether in Llandudno or anywhere else, will my right hon. and learned Friend keep on turning left, which is always a great direction in which to travel? Will he be going to Llandudno to attend the annual conference of the Labour Party in Wales? If so, is he aware that several motions have been tabled calling for the restoration of those cuts in public expenditure which the Government have already felt obliged to implement? Would that not be a lesson for the hon. Member for Conway (Mr. Roberts), who makes a plea about unemployment and simultaneously favours a policy that would increase it?
  Mr. Morris: My hon. Friend is absolutely right. I hope to attend the Labour Party conference in Llandudno. I reiterate and endorse what my hon. Friend has said, that if the Conservative Party were in power—which Heaven forbid—there would be massive cuts in public and other expenditure in Wales, and much more unemployment.

  Local Government
  Mr. Roy Hughesasked the Secretary of State for Wales if he has initiated any future plans to simplify the structure of local government.
  Mr. Roderickasked the Secretary of State for Wales whether he has any proposals for the reform of local government in Wales.
  Mr. John Morris: There is disquiet in Wales about the present structure of local government. I have made it clear that it will be one of the earliest tasks of the Welsh Assembly to consider the matter.
  Mr. Hughes: Does my right hon. and learned Friend agree that there is an imperative need to create a one-tier system of local government throughout Wales to restore local ties and identities and, in the process, to save the taxpayer and the ratepayer a great deal of money?
  Mr. Morris: We shall have to wait and see what emerges, but there is undoubtedly grave disquiet in Wales about the present system of local government foisted upon Wales by the Conservative Party. It is expensive, and the sooner it is examined and reformed the better.
  Mr. Roderick: Will my right hon. and learned Friend realise that he will be very popular in Wales if he produces plans and does not leave it to the Assembly to produce plans to create a one-tier system, and that he will be even more popular if he brings about changes simultaneous with the creation of the Assembly which would allay the fears of local government officers by allowing them to apply for the jobs needed in the Assembly?
  Mr. Morris: I believe that the main hope for local government reform—there is obviously a great need to study the implication of what should be done—lies in the Welsh Assembly.
  Sir Raymond Gower: Is the Secretary of State aware that questions like this are causing grave disquiet among many people employed in local government in the Principality? They, like myself, feel that what local government needs now is a period to settle down rather than further disturbance.
  Mr. Morris: That could be said to a man serving a life sentence in prison. It is true that in Wales there is disquiet and that this question is bound to be asked while we are working a system with which, on all the evidence from every side, people are more and more unhappy.
  Mr. D. E. Thomas: When the Secretary of State considers the reorganisation of local government, will he consider simultaneously the position of the area health authorities in Wales, which are coterminous with the local authorities and undemocratic in structure? Will he also look at ways in which both could be simultaneously reorganised?
  Mr. Morris: Of course, in the Government's proposals, which we are determined to implement, that would be within the jurisdiction of the Welsh Assembly.
  Mr. Ioan Evans: Does my right hon. and learned Friend recall the party putting forward proposals for an elected Council in Wales? Although he is right to say that the Conservative reorganisation of local government left much to be desired, it would be wrong to leave that as it is, and then to put another tier on top of it and ask those concerned to do the job. There is deep concern among associations of local government officers in Wales, who understand that an authority will be set up to be serviced by civil servants and that a tier of local government serviced by local government officers will be done away with.
  Mr. Morris: My hon. Friend must understand by now that we were not proposing another tier on top of all the existing tiers of local government but that it was the functions of the Secretary of State and the nominated bodies that we were proposing. That is rather a different matter from the existing surplusage of tiers. The evidence has been made more and more manifest that from the point of view of local government in Wales, with or without the Assembly this will have to be tackled sooner rather than later.
  Mr. Geraint Howells: Does the Secretary of State agree that the majority of Welsh people are in favour of a Welsh Parliament and a multi-purpose authority based on the old county boundaries, in order to give more support and financial help to the community councils?
  Mr. Morris: I am sure the hon. Gentleman would agree that what is important in local government—because services have to go on and people have to have the schools and roads and other services that they require—is not to prejudge what emerges but, rather, to get it right.

  Water Rate
  Mr. Cledwyn Hughesasked the Secretary of State for Wales if he will give an estimate of the average domestic water rate in Wales for the next financial year.
  Mr. Alec Jones: The Welsh National Water Development Authority has fixed a water rate of £5 plus 17p in the pound of rateable value for 1977–78. The typical householder in the area with a domestic property of £120 rateable value will receive a water bill of £25·40.
  Mr. Hughes: Taking account of the water rates in Wales before 1973, may I ask whether it is not deplorable that the hold-up of current legislation is depriving the ratepayers of Wales of much-needed relief? Will my hon. Friend give the House some indication about what the saving would be if the Bill now before the House were to become law in the near future?
  Mr. Alec Jones: If the equalisation Bill had been implemented in April this year, it would have meant a transfer to the funds and resources of the Welsh National Water Development Authority of £3·6 million. What it really means is that the obstructive tactics of the Conservative Opposition in Committee have cost Wales £3½ million and that the average domestic water consumer's bill will be about £3·40 higher than it would otherwise have been.
  Mr. Wigley: Will the Minister come clean and admit that because of the delay in bringing the Bill forward the Government are equally to blame for robbing Wales of £3½ million? Since there is a 12-month delay, will the hon. Gentleman say whether the Government will give a direct Exchequer subsidy to Wales to alleviate the very high bills we have had, since the Government have already earmarked some money to go to Wales for this purpose?
  Mr. Alec Jones: The hon. Gentleman is completely mistaken. As he and the House know, it had been the Government's intention to introduce the Bill a week earlier, but the House decided, in accordance with custom, that it would adjourn its proceedings on the day the Bill was to be introduced as a mark of respect to the late Lord Avon. That was an extra delay which was out of the control of any Government. Had there been the will on the part of the Conservative Opposition, the Bill could have passed through Committee and would have been implemented this year.
  Mr. Wyn Roberts: Will not the Minister admit that his right hon. and learned Friend's claim in the Liverpool Daily Post to have achieved a victory in the Cabinet by having the Bill at all was failed totally by the failure of the Government to introduce the Bill for Second Reading before 24th January? Is not the hon. Gentleman aware that some of his own hon. Friends are opposed to the Bill? By pressing this point, is not the Secretary of State threatening to make himself more of a Yorick than he is?
  Mr. Alec Jones: My right hon. and learned Friend was quite correct when he said that it would have been possible to have got this piece of legislation through this House and the other place in time to be implemented this year had the Conservative Opposition been prepared to give any measure of support. I know that the hon. Gentleman voted for the Bill, but it was a typical example of trying to get the maximum political advantage out of an issue. A free vote in this Chamber, coupled with obstructionist tactics upstairs, has cost Wales dearly on this issue.
  Mr. Lipton: Without expressing any view, either in favour or against, about the Bill, can my hon. Friend say how much London ratepayers have contributed towards the cost of water in Wales?
  Mr. Alec Jones: The partial equalisation scheme, which this House passed by a large majority, meant exactly what it said. Any scheme of partial equalisation must mean that some will pay more and others will pay less. The burden on water consumers in Wales was unfair and could not be tolerated, and ought not to have been tolerated, by this House. As my hon. Friend knows, this meant that water charges in the Thames area would have gone up by 2p per week. That would have been a small price to have paid to iron out the injustices from which not only the people of Wales but other parts of England, like the South-West and many other areas, were also suffering.

  Mental Hospitals (Compulsory Admissions)
  Mr. D. E. Thomasasked the Secretary of State for Wales what was the total number of compulsory admissions under Section 29 of the Mental Health
  12
  Act 1959 to major mental illness hospitals in Wales in the latest year for which figures are available.
  Mr. Barry Jones: In the year ending 31st December 1975 there were 998.
  Mr. Thomas: Does the hon. Gentleman accept that this disturbingly high number of compulsory admissions for observation under this section is substantially greater in Wales than in other parts of the United Kingdom? It is now time that the procedure for admissions for observation was removed from legislation, and this should happen in a new Mental Health Act. In the interim, and pending discussions and consultations with area health authorities in Wales, will the hon. Gentleman seek to reduce the high percentage of these compulsory admissions?
  Mr. Barry Jones: I appreciate the points that the hon. Gentleman has made. The Mental Health Act is now being actively reviewed and everyone can submit evidence. We as a Department are seeking precise details, and I can assure the hon. Gentleman that there is no complacency.

  Improvement Grants
  Mr. Gristasked the Secretary of State for Wales how many house improvement grants he expects to be made in Wales during the present calendar year; and to what extent these grants are adjusted to take account of inflation.
  Mr. Alec Jones: Between 7,000 and 8,000. An adjustment was made in December 1974, when the eligible expense limit was increased by 60 per cent. over the limit that had previously applied. It is being kept under review.
  Mr. Grist: Does the Minister agree that since 1974 costs have risen sharply and, therefore, there is a strong case for increasing the value of these improvement grants? Indeed, with the virtual cessation of local authority mortgages for older houses improvement grants become even more important, particularly in city centres and especially for younger couples.
  Mr. Alec Jones: I certainly agree that it is important to carry on this sort of improvement work. That is why we have given local authorities a block allocation this year so that they can transfer funds

  13
  from building new houses to the improvement sector if they judge that this is in accordance with the needs of their localities.
  Mr. Ioan Evans: Does my hon. Friend agree that the improvement grant scheme in recent years has played an important part in maintaining the housing sector? As there are now a great many construction workers who are unemployed, and as we are now getting out of our economic difficulties, may I ask my hon. Friend to introduce a scheme of public works and use the housing improvement grant as a method of employing these workers?
  Mr. Alec Jones: All I can say is that we have made our housing allocation to local authorities for next year. It must be left to them to make a decision about how they should spend it. My hon. Friend is probably aware that in September I offered local authorities in Wales some extra money for this purpose and that more than half the authorities turned it down.

  Agriculture (Price Review)
  Mr. Nicholas Edwardsasked the Secretary of State for Wales what representations he has received from the agricultural unions about the price structure for the coming year; and whether he will make a statement.
  Mr. John Morris: I have met representatives of the farmers' organisations in Wales in the context of this year's annual review. The conditions and prospects of the agricultural industry are set out in the White Paper "Annual Review of Agriculture"—Cmnd 6703—presented to Parliament on 12th January 1977.
  Mr. Edwards: Is the right hon. and learned Gentleman aware that there is a need to remove present uncertainties as quickly as possible? Is he aware that farmers will be bitterly disappointed if there is a whittling down of what is proposed by the Commission? The present discrepancy between Irish and United Kingdom prices must be reduced. If farmers are to produce the food we need, there must be a substantial recoupment of the additional £900 million in costs that they have suffered.
  Mr. Morris: The hon. Gentleman will be aware that the Commission has pre-
  14
  sented certain proposals. The first substantive discussions will take place in Brussels on 14th and 15th March. I hope to be there myself, as I was last year. There are many complex factors arising from these proposals and we must have regard to producers as well as to consumers.
  Mr. Geraint Howells: Is the right hon. and learned Gentleman aware that many of the fears in agriculture in Wales are about the future of the marketing boards and the support system, which has operated so well for the past 25 to 40 years? Is he in a position to give an assurance to the industry in Wales that the Milk Marketing Board and other boards with statutory powers are here to stay?
  Mr. Morris: I have said repeatedly that the marketing boards—in particular, the Milk Marketing Board—have successfully carried out a tremendously important job for the good order of agriculture, especially for the milk industry. We shall seek to do our utmost to ensure that we lose none of the great values and benefits of the years of work of that admirable board.
  Mr. D. E. Thomas: When the right hon. and learned Gentleman next meets the Community Agriculture Ministers, will he discuss with them the need for a coherent European sheepmeat policy? Does he accept that the way to achieve that would be to ensure that the markets are open, especially the French market, to producers from Wales? Will he help them to retain within the United Kingdom the present system of guaranteed prices for lamb?
  Mr. MorrisThe hon. Gentleman is asking for a number of different things, some of them contradictory. Certainly I am aware of the problem that arises from the attitude of the French from time to time. However, the sheep industry would not affect the green pound, to which the hon. Member for Pembroke (Mr. Edwards) referred.
  Mr. Cledwyn Hughes: Leaving exaggeration aside, is my right hon. and learned Friend aware that there is acute concern in most parts of Wales and in parts of England about the sharply declining price of beef? Is he aware, in particular, that farmers in my constituency,

  15
  which is a livestock rearing area, are worried about the future? Will he take that into account in his consultations with my right hon. Friend the Minister of Agriculture, Fisheries and Food leading to the review?
  Mr. Morris: I am sure that with his knowledge my right hon. Friend would not want to paint too gloomy a picture. I know that that is not his intention. As he knows, the market is traditionally sluggish after Christmas. There was an influx of Irish animals, arising partly from the long warning that was given in respect of Irish devaluation. Substantial numbers came on to the market in a very short time. There has not been the sort of market on the Continent that might have been expected. These matters are to be taken into account. My right hon. Friend will also accept that there have been high and good prices for stores throughout the winter. Some of us were rather surprised by the way in which those concerned obtained their profit last autumn.

  INDUSTRY

    Production
    Mr. Jesselasked the Secretary of State for Industry by what percentage industrial production has risen since 28th February 1974.
    The Under-Secretary of State for Industry (Mr. Les Huckfield): Adjusting for the effects of stock changes, it is estimated that industrial production was at much the same level in December of last year as in February 1974.
    Mr. Jessel: How can the Labour Government expect to find the resources for their schemes for social improvement if in three years in office they have failed so pathetically to promote industrial production?
    Mr. Huckfield: I am sure that the hon. Gentleman recognises that it is a bit more detailed and a bit more significant than that. Most countries in the Western world have been going through some sort of recession. As he also knows, it is the Government's policy to switch resources into manufacturing industry, and under the Industry Act alone the Government have channelled some £425 million into industry.
    Mr. Kenneth Clarke: In considering the ways in which the Government might improve the disappointing statistics of industrial production, will the hon. Gentleman consider the analysis in the Financial Times this morning of Government expenditure on assistance to industry, part of which the hon. Gentleman has just quoted with pride? The analysis breaks down the figures. Will the hon. Gentleman confirm that it shows that far too great a proportion of Government expenditure continues to go on a few rescue operations for large ailing companies that are quite unlikely significantly to contribute to improved production or productivity in the next few years?
    Mr. Huckfield: I think that the hon. Gentleman has failed to appreciate the full range and significance of each of the Government's industry aid schemes. If he considers the accelerated project scheme, he will find that of the £84 million that the Government have injected about £640 million of investment has in the end been generated. The hon. Gentleman should look at the Government's assistance to industry in totality.
    Mr. Rost: As the Labour Party conned the electors into voting for it three years ago with the slogan "Back to work with Labour", will the hon. Gentleman now give his definition of what was meant by that promise?
    Mr. Huckfield: The only way in which one can answer such a question is to say that if the previous Administration had ensured that investment was in factories rather than in office blocks, we might all have had a far better industrial base on which to expand.
    Mr. Heffer: Does my hon. Friend agree that investment in industry by private concerns has been absolutely pathetic over the years and that the private concerns that have recently been mentioned were precisely those that were suffering and that had to be rescued by the Government? Is it not clear that we cannot tolerate such a position any longer and that the Government will have to rethink their industrial strategy and take it one stage further by bringing in a system of compulsory planning agreements to get the investment where we need it at the right time and in the right amount?
    Mr. Huckfield: I take careful note of what my hon. Friend says. I recognise that there is a great deal of feeling in the trade union and Labour movement along the lines that he has expressed. I hope that my hon. Friend will recognise that the Conservative Prime Minister, despite everything that his party says it has done for industry, despite all the claims made by Conservative Members, was reduced to complaining about the low level of investment by private industry.
    Mr. Jessel: In view of the highly unsatisfactory nature of that reply, Mr. Speaker, I beg to give notice that I shall seek to raise the matter on the Adjournment.

  Public Corporations (Purchases)
  Mr. Tebbitasked the Secretary of State for Industry if he will issue clearer guidelines to public corporations concerning the purchase of British or imported products.
  Mr. Les Huckfield:>My right hon. Friend sees no need to do so.
  Mr. Tebbit: When the Secretary of State's advice to buy British conflicts with the financial objectives laid on public corporations, will the hon. Gentleman make it plain whether those objectives are in any way waived? Why does the Secretary of State use the term "British made" when he is unable to define what "British made" means? For example, is a British motor car more British if it is assembled in Britain by an American-owned company from components made in Europe, or if it is assembled in Europe from components made in Britain by a British-owned company?
  Mr. Huckfield: In his customary fashion the hon. Gentleman has tabled a series of Questions on this issue which, frankly, try to cloud the whole matter in semantics. My right hon. Friend was expressing an opinion with which I wholeheartedly agree. In expressing that opinion he took account of the need for nationalised industries to do their best to see best value for money and he took account of their international obligations. The hon. Gentleman does not serve the public sector and does not serve British industry by the sort of Questions that he is tabling.
  Mr. Ioan Evans: Does not my hon. Friend realise that the TUC is yet again calling on the Government to introduce selective import controls? Before the Government decide to introduce such controls, will he give preference to the policy of buying British on all occasions? In that way cannot the public corporations give an example to the rest of British industry, because the more we buy British the greater will be our employment prospects?
  Mr. Huckfield: I take careful note of what my hon. Friend said. I recognise that there is a great deal of truth in the view of the trade union and Labour movement on this topic. If we examine the 24th Report of the Select Committee on European Secondary Legislation, ordered to be printed on 16th June last year, we see that it was then said that 95 per cent. of public purchasing in the United Kingdom was with United Kingdom industry; the average percentage for nationalised industry was higher than the figure for the public sector as a whole.

  CIVIL SERVICE

    Dispersal
    Mr. Jesselasked the Minister for the Civil Service how far Government dispersal policy is affected by changes in regional employment statistics.
    The Minister of State, Civil Service Department (Mr. Charles R. Morris): Dispersal policy involves long-term considerations and long-term planning. The Government, in framing their dispersal programme, have considered, among other factors, long-term trends indicated by regional employment statistics.
    Mr. Jessel: How can the Minister any longer justify uprooting thousands of civil servants from their families in the South-East, at vast expense, to promote employment in the provinces when there is substantial and long-term unemployment in London and the South-East?
    Mr. Morris: I appreciate the hon. Gentleman's concern about unemployment in London and in the South-East, but there has been a great deal of unemployment in Scotland, Wales and the English regions over many years. The Government's dispersal programme is a

    19
    measure of the Government's commitment to assisting employment in Scotland, Wales and the English regions.
    Mr. Grist: Will the Minister take the opportunity to confirm the Government's intention to disperse Ministry of Defence jobs as originally announced?
    Mr. Morris: The Government's commitment to disperse employment to Cardiff remains firm.
    Mr. Rooker: Will my hon. Friend confirm, contrary to what was said by the hon. Member for Twickenham (Mr. Jessel), that the idea of dispersal policy is not to uproot civil servants and send them north, but to send their jobs north?
    Mr. Morris: My hon. Friend is right, and I am grateful to him for making that point. We must examine the Government's dispersal policy in regard to civil servants from London and the South-East in the context that there are 31,000 Civil Service jobs involved, out of a figure of 750,000 jobs, both industrial and non-industrial.
    Mr. Tebbit: In view of this series of answers, will the Minister say why my constituents who are civil servants are being compulsorily posted to remote areas or are to lose their jobs so that other people can take over those jobs in a remote part of the country?
    Mr. Morris: The hon. Gentleman speaks of compulsory posting. Civil servants in London and the South-East who are subject to the Government dispersal policy must have regard to their domestic circumstances, children at school, and all the rest of it. There is a problem when one uproots them and sends them to new regional locations. The Government are anxious to conduct the dispersal policy on a voluntary basis as far as practicable.

  Pension Schemes (Comparability)
  Mr. MacGregorasked the Minister for the Civil Service whether he will give instructions to the Pay Research Unit to undertake an examination of the current situation relating to occupational pension schemes in the private sector in order to bring up to date information on their comparability with Civil Service pension schemes.
  Mr. Charles R. Morris: No, Sir. Pay research has been suspended as part of the Government's counter-inflation policy.
  Mr. MacGregor: Is the Minister aware that the Government Actuary recently promised the General Sub-Committee of the Public Expenditure Committee that he would update the 1973 actuarial assumptions on which the 1·75 per cent. deduction from the fair comparisons between public and private sector pay is based? To complete the picture, is not another survey of this sort required? Will the Minister think again about the situation, because the results would help to allay the considerable public disquiet about inflation-proof pensions?
  Mr. Morris: I understand that in the last few days the Government Actuary has submitted his views to the Select Committee on Public Expenditure. The point made on pensions was only one facet of the fair comparison exercise undertaken by the PRU. The question of pay is another facet, and the topic of fringe benefits is another. One has to examine all these facets.
  Mr. Ovenden: Will my hon. Friend try to correct some of the misrepresentations by Opposition Members in this one-sided campaign against the Civil Service? Will he ask the PRU also to examine the perks paid to workers in private industries and compare those workers with their counterparts in the public service?
  Mr. Morris: My hon. Friend is right to draw attention to the perks enjoyed by those in the private sector who undertake much the same jobs as civil servants. We must bear in mind the fact that those who work in the private sector enjoy such perks as very low mortgage rates, interest-free loans, and many other advantages. Those perks are not available to civil servants. We also must remember that such perks in the private sector are inflation-proof.
  Mr. Tim Renton: Does the hon. Gentleman not appreciate that there is no campaign against civil servants? Is it not important to express concern at the inflation-proofing of Civil Service pensions when, this year, price inflation looks tragically like rising to a figure of 20 per cent? Will he examine that situation?
  Mr. Morris: The hon. Gentleman has questioned me on every occasion at Question Time when we have dealt with the subject of the Civil Service. I bear in mind his assurance that no campaign is intended. Pensions indexing is a fac- for that the Government have under constant review. We reviewed the matter last year and the year before that, and we shall be reviewing the indexing of pensions this year, too.
  Mr. Wrigglesworth: Despite the Opposition protests, is it not a fact that a campaign has been waged by the Tory and Liberal Parties against Civil Service pensions? Is it not true that the Conservative Party was responsible for introducing the inflation-proof scheme, against the wishes of the trade unions, whose members wanted pensions to be linked to increases in wages?
  Mr. Morris: My hon. Friend is right. The 1 million retired public pensioners, those drawing Armed Forces pensions, the police, and members of the nursing profession, must wonder what they have done to deserve such a campaign as is being waged against them. Let me put the statistics on the record. I refer to the provisions that civil servants have forgone in terms of direct contributions for pension benefits. In the first place, in terms of comparisons we must remember the offset of Civil Service pay—
  Mr. Tebbit: Are the Minister's answers inflation-proof?
  Mr. Morris: I thought the Opposition were anxious to extend their knowledge of the factors related to Civil Service conditions and pensions. [HON. MEMBERS: "Too long".] Very well. I shall make the information available in the Official Report.

  Parliamentary Commissioner
  Mr. John Huntasked the Minister for the Civil Service what steps he will take to implement the recommendation of the Select Committee on the Parliamentary Commissioner for Administration that the jurisdiction of the Parliamentary Commissioner should be widened to include personnel matters affecting civil servants.
  Mr. Charles R. Morris: The Government have been considering their reply
  22
  to the various points made in the report of the Select Committee to which the hon. Member refers. A reply will be published shortly as a White Paper.
  Mr. Hunt: Does the Minister recall that he and I indulged in recent correspondence regarding one of my constituents, who feels most dissatisfied with the value of his pension following transfer from private industry to the Civil Service? Is it not wrong that the Civil Service Department acts as judge and jury in such a situation? Is it not time that the Government followed the advice of the Select Committee and allowed complaints by civil servants against the Government to be investigated by the Ombudsman, in the same way as other complaints are dealt with?
  Mr. Morris: The procedures suggested by the hon. Gentleman would only increase charges of privilege in respect of civil servants. If we were to extend the jurisdiction of the Parliamentary Commissioner, it would create a situation in which such an extension would not be equitable, since it would place Crown servants in a specially favourable position compared with other employees.

  HOUSE OF COMMONS

    European Community Documents (Motions)
    Mr. Hal Millerasked the Lord President of the Council if, in view of the circumstances of the withdrawal of the Government motion on EEC documents on Monday 7th February, he will give an assurance that the House will not in future be asked to consider such motions before copies of the relevant draft EEC directives are available in the Vote Office.
    The Lord President of the Council and Leader of the House of Commons (Mr. Michael Foot): Commission proposals for legislation are made available to the House on publication and in advance of debate. Although discussions in the Council of Ministers may take place over a lengthy period, the Commission's original proposals are the only document formally before the Council. Only very occasionally does the Commission issue a formal revised proposal. Whenever

    23
    it is possible and helpful the Government provide information on the progress of the proposals by making updated explanatory memoranda available to the House. But I am considering whether anything more can be done.
    Mr. Miller: Will the Lord President take on board the fact that there was a draft Council directive of 2nd June 1976 to which the Government memorandum clearly referred, although enclosing an earlier and overtaken directive of 1968? The updated memorandum was available to trade associations, one of which briefed me, but not to Members of Parliament. Is the right hon. Gentleman prepared to tolerate the continuance of that situation?
    Mr. Foot: The difficulty of the situation arises from the fact that we in this House do business differently from the way it is done in the Community. We have to seek a way of overcoming that problem. However, the Government did not withhold from the House any proper document that we were committed to offer to the House. This was a confidential document. If we made confidential documents available to the House on the same basis as proposals, there would be further difficulties. However, I appreciate the difficulty that the House is in, for the reason that I stated at the beginning of my remarks, and, as I said, I am looking to see how we can seek a way of overcoming it.
    Mr. Powell: Do not this and similar cases show that the incompatibility of these proceedings of the Council of Ministers with control by this House is inherent and ineradicable?
    Mr. Foot: It is inherent. Whether it is ineradicable is another matter. Certainly there are difficulties, as the House saw and as I have acknowledged on other occasions, and we must seek to overcome them. But we cannot overcome them by saying that confidential documents shall be made public.
    Mr. Spearing: Is my right hon. Friend aware that I can confirm the statement made by the hon. Member for Bromsgrove and Redditch (Mr. Miller) because I have seen this draft directive, which I believe is called a "working document"? If, as my right hon. Friend says, this is still confidential and not available to this
    24
    House, although it is available to trade associations in the country, does not that show that the consultation procedure of the EEC in which this House plays no formal part has great federal dangers if ever there are direct elections for this purpose?
    Mr. Foot: That is a different matter and a larger question, which I am sure this House will want to consider carefully. I am saying that on the occasion when we had these difficulties the Government and the Department were not withholding any document that we were committed to give the House. We shall see how we can approach the same subject again and present it to the House in a way in which the House can deal with it. But the suggestion that all these negotiating documents should be available to the House is not a solution to the problem.
    Mr. Marten: They are not negotiated documents. We are having legislative proposals placed before the House. If they are to be secret, we are put in an absurd position, especially as the explanatory memorandum in that case was inaccurate.
    Mr. Foot: I always look carefully at anything that the hon. Member for Banbury (Mr. Marten) says, but I was not aware that there was any case for saying that the explanatory memorandum was inaccurate. I am sure that the explanatory document on behalf of the Department sought to make the matter as clear as possible. An explanatory document is not the same as the document itself. But the document itself is not a proposal in the form in which it comes from the Commission. That is one of the difficulties. As I say, I am seeking a way to overcome it.
    Mr. Dykes: Is not the essential problem that the Community is used to dealing with draft legislative instruments in provisional form, whereas this House is used to dealing with definitive legislation at every stage? Within that overall context, will the Lord President say what differential treatment he intends for draft regulations as opposed to draft directives?
    Mr. Foot: I am having a look at this to see whether we can get some definition that deals with all these questions.

    25
    To some extent the problem arises from the clash of methods of dealing with these matters which the hon. Gentleman describes. But the solution proposed by the hon. Member for Bromsgrove and Redditch (Mr. Miller) is not a solution to the problem in my opinion. We have to search for another solution.

  Select Committees
  Mr. Whiteheadasked the Lord President of the Council what plans he has for increasing the effectiveness of the Select Committee system.
  Mr. Foot: The way in which Select Committees operate is within the terms of reference of the present Select Committee on Procedure. I think the House should await any recommendations which the Select Committee may decide to put forward on this matter.
  Mr. Whitehead: I thank the Minister for his reply, but is he aware that it is difficult for those of us who are trying to follow with interest the Select Committee on Procedure because proceedings are published a month late? Before the Committee reports, would the Minister give instructions, or put the notion before the Services Committee, so that we have Select Committees' proceedings published in Hansard exactly as Standing Committee proceedings are published?
  Mr. Foot: Printing problems would arise in that respect. I am sorry if there has been any inconvenience to the House because of the gap in time between the proceedings of the Committee and the publication of the reports, and I shall see what can be done.

  DEVOLUTION REFERENDUMS (VOTING RIGHTS)
  Mr. Adleyasked the Lord President of the Council what consideration he has given to the practical problems involved in making arrangements for Scottish and Welsh people not currently on an electoral register in Scotland or Wales but on the register elsewhere in the United Kingdom, but enjoying Scottish or Welsh nationality by birth or parentage, being enabled to vote in the devolution referenda.
  The Minister of State, Privy Council Office (Mr. John Smith): I have nothing
  26
  to add to what I said during Committee stage of the Scotland and Wales Bill on 10th February.
  Mr. Adley: In the new circumstances prevailing since the Question was tabled, does not the hon. Gentleman agree that one way in which it would be possible to overcome the opposition to devolution from many English Members of Parliament would be to assure them that the Government were taking steps to make available the known views of the people of Scotland and Wales? In view of the danger of the Scottish people coming to believe that it is Members of Parliament from England who are preventing their obtaining any measure of devolution, will the hon. Gentleman say that it is not beyond the wit of the Government to advise a form of referendum before legislation is introduced, and, if necessary, to make it a referendum which can be confirmed by a further referendum after legislation has been put through this House?
  Mr. Smith: That would require to be considered very carefully. We do not rule out any proposition entirely. But, as my right hon. Friend the Lord President indicated last Thursday, the Government have serious reservations about the proposition to have an immediate referendum. It would require separate legislation and, inevitably, the question or questions would be imprecise—a feature which would not apply to the referendum which we propose.
  Mr. Grimond: Although I have some doubts about the proposal in this Question, will the Government bear in mind if they come to a referendum that those people who normally vote in a General Election will expect to vote—that is to say, those islanders in my constituency who normally vote by a postal vote will expect to vote, and Service personnel will certainly expect to vote? Will the Government give attention to that situation so that these people can vote?
  Mr. Smith: I thought that we had indicated in Committee that a special effort was being made to incorporate Service voters, and, of course, postal voters would have to be taken into account as well. To have any value, any proposition would have to have the largest possible number of people participating.
  Mr. Kinnock: Is my hon. Friend aware that many people realise the strong reservations that the Government must have about producing a speedy referendum? But the problem of impreciseness does not arise if the Bill is put in the form of a White Paper. As to timing, it is largely a matter for the Government to decide whether to have a Bill to permit a referendum or no Bill at all.
  Mr. Smith: With respect, I disagree with my hon. Friend that the problem of impreciseness can somehow be avoided by producing a White Paper. The problem arises about what the various solutions that will be canvassed by people in a referendum mean in practice and what the House would do with them once the results had been obtained.

  INTERNATIONAL NEWS AGENCY
  Mr. Maddenasked the Lord President of the Council if the Services Committee has yet completed its inquiries into the activities of International News Services in relation to certain hon. Members.
  Mr. Foot: The activities of International News Service were among the matters considered by the Committee when it examined the rules regarding the use of House facilities by strangers. I refer my hon. Friend to the statement made by Mr. Speaker on 2nd December last on the advice of the Committee.
  Mr. Madden: In view of the most serious charges which have been made against this company, including the harassment of Members and the exertion of undue pressure on Members, will my right hon. Friend undertake that the Committee will conduct its inquiry extensively and with a sense of urgency? Because of the concern which exists among many Members about the activities of commercial lobbyists in this House, will my right hon. Friend consider establishing a register of commercial lobbyists and also a code of conduct aimed at cleaning up the activities of commercial lobbyists in this House?
  Mr. Foot: It is not the practice to disclose the proceedings of a Committee or Sub-Committee until they are reported to the House. It would not be right for me also to comment on the way in which a Sub-Committee is conducting its investi
  28
  gations at the moment. Other than that, I have nothing to add to what Mr. Speaker said in his statement earlier. I fully accept that the whole House will wish to see that lobbyists conduct their proceedings properly. If they do not do so, it is not necessarily a question for the Sub-Committee but one for hon. Members to raise in this House.

BRITISH LEYLAND MOTOR CORPORATION
Mr. Ridley(by Private Notice) asked the Secretary of State for Industry if the Government will continue to finance British Leyland in view of the current strikes.
The Minister of State, Department of Industry (Mr. Gerald Kaufman): Last August the House approved the provision of £30 million loan finance as the Department's contribution to the £100 million loan authorised by the Government. A decision about the provision of further finance beyond that will depend upon a thorough assessment of performance, on the basis of the criteria that have been announced.
Mr. Ridley: Does the Minister remember that the CPRS said that further money should depend on performance and that the NEB has said many times that further tranches of finance should depend on improvements in industrial relations at British Leyland? As this is clearly not happening, has the Minister discussed with the NEB a breaking point beyond which the Government are not prepared to go? What is that breaking point, and are the Government prepared to stick to it this time?
Mr. Kaufman: The criteria upon which further finance will be made available to British Leyland were laid down not by the CPRS but by my right hon. Friend the Member for Huyton (Sir H. Wilson) when he was Prime Minister, when he said, in announcing the rescue of British Leyland,
"the release of further stages of Government funding will be determined in the light of the contribution being made to the improvements in the performance of British Leyland by better industrial relations and higher productivity. This is a condition to which the Government attach great importance."—[Official Report, 24th April 1975; Vol. 890, c. 1746.]
That remains the position.

29
A breaking point is more likely to come through the failure of internally-generated finance within Leyland because, as the personnel director of Leyland Motors pointed out on the radio yesterday, the problem for Leyland is that it has to provide at least half its money from internally-generated finance. This money is not coming forward because of the failure in production, and because of that, as Mr. Whalen, the personnel director, said, the future investment content in the 10-year Ryder Plan must be in doubt.
I do not wish to put any particularly unpleasant connotations on what was said by the hon. Member for Cirencester and Tewkesbury (Mr. Ridley), but he seemed to be calling for some kind of summary execution. The danger to Leyland is of bleeding to death.
Mr. Heffer: Is the Minister aware that many of us regard the statements that are being made by the Opposition as absolute hypocrisy? Does he realise that while the Tories say that there should be more incentive for the higher paid, when the workers who are higher paid want more incentive they are accused of disrupting industry because they go on strike? Does the Minister agree that there is a serious problem at Leyland and that there should be early negotiations and discussions with the work force involved, that it is a longer-term problem and that there ought to be a national negotiating machinery in that company? Is that not the way in which the matter ought to be discussed rather than by threats of closing Leyland or anything of that kind, such as the Opposition suggest?
Mr. Kaufman: These problems will not be solved by threats. They will be solved only by sensible action by all those involved.
Of course my hon. Friend is perfectly right when he says that for the toolroom men this is a problem of incentives and differentials.
I discussed this with the convener and the shop stewards of British Leyland at Solihull when I visited them on Friday, and I fully understand the problems that they put forward. But there is a machinery through which this can be discussed, and that is the established trade union machinery. I know that my hon. Friend
30
would agree with that. The AUEW has such established machinery and has called upon the workers involved in the unofficial dispute to return to work so that established procedures can be followed. Surely my hon. Friend will agree that that is the right course of action.
Mr. Norman Lamont: Is the Minister aware that we regard the strike as extremely serious? Is not the news that toolroom workers have today refused to meet AUEW officials regrettable?
Has not the social contract inevitably exacerbated the old problem of differentials? Will the Minister, therefore, give the assurance that in the next round of wage restraint—if a next round there be—the Government will at least make sure that the policy will go some way towards restoring differentials?
On the point made by my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley), will the Government seek to disabuse Leyland workers of the comfortable and apparently widespread idea that the withholding of funds is a sanction that no Government would dare to use? Will the Government, as my hon. Friend urged, stick to the targets of the NEB and make it clear that if workers are implacably determined to destroy Leyland, no Government can save them from their folly?
Mr. Kaufman: The criteria that my right hon. Friend the Member for Huyton laid down in April 1975 remain the criteria on which future finance will be allocated to Leyland. The hon. Gentleman can be sure about that. It is important for all those involved to realise that while, of course, the problem of differentials is a serious one, nevertheless the question now is the survival of Leyland. The issue in April 1975 was not differentials but the dole. That could be the issue again unless the bleeding of British Leyland is stopped quickly.
Of course, when I meet shop stewards—whether at Leyland, British Steel Corporation, Ferranti, Alfred Herbert or wherever—they all make clear that the problems of differentials and anomalies caused by the current pay policy are problems that trouble them very much. The joint letter that was sent to the Secretary of State by Mr. Whittaker and Mr. Robinson will be taken into account by

31
the Chancellor of the Exchequer and by other relevant members of the Government when any future stages of the pay policy are considered.
But it has to be accepted that, while differentials are a problem, not only in Leyland but in organisations such as the British Steel Corporation and the others that I have mentioned, other workers have not sought to emphasise the problem of differentials by disrupting production.
Mr. Richard Wainwright: Since the strikers have now said that they will not meet even their own union leaders, will the Minister consider some means of reinforcing the general truths that he has stated by making it clear to everybody in Leyland that the Government have taken off the table and are not willing even to consider any further negotiations or plans for financing British Leyland until some discipline is restored?
Mr. Kaufman: Negotiations about a further tranche for British Leyland are not required to take place until later this year. The hon. Gentleman has spoken about discipline. While of course we want orderliness within British Leyland—that is essential if Leyland is to be saved from the bleeding that will otherwise kill it—discipline is not something to be imposed upon workers by a Government as if they were children but something to take place between the workers and their union. The AUEW is the most appropriate body to apply discipline to its members in the industry.
Mr. Litterick: Is my hon. Friend aware that adequate negotiating machinery does not exist at British Leyland to cope with the present toolroom dispute? Will he make it as explicit as he knows how that the Government will on no account mobilise the power of the State against the workers of British Leyland, bearing in mind that this was the basic tactic of the German Nazis to destroy the German trade union movement?
Mr. Kaufman: The power of the State was mobilised two years ago to save 170,000 jobs in British Leyland. The power of the State rescued those jobs, and the money of the State—the taxpayers' money—has been used to save those jobs. Without wishing to use such words as "discipline" and "threats", I
32
should say that it is important for all workers of British Leyland to realise that the power of the State has saved their industry and that a response to what the State has done is very important if British Leyland is to go on producing the cars that are needed and making the money that is needed.
It is my hon. Friend's view that the negotiating machinery is not satisfactory, but yesterday Mr. Terence Duffy, the Midlands executive member of the AUEW, the union to which the toolroom workers belong, said that he had told the leaders of the strike that they should call it off. He pleaded with them to help the union to help them get back to work. He said that they were putting all their jobs in danger and that it was impossible for the toolroom to have a separate negotiating procedure. The AUEW has negotiating procedures and Hugh Scanlon and the rest of the executive committee have called on its members in the tool room to go back to work. These are unofficial disputes, and the workers have a union that is fighting for their interests.
Mr. Eyre: Is the hon. Gentleman aware of the strong feeling in the West Midlands that the Government should have required further undertakings on production when Government aid was made available in 1975 and subsequently? Will he consider asking Mr. Len Murray and the TUC to review urgently the whole system of trade union organisation and representation at British Leyland? Is he aware that 17 unions are involved and that the present system cannot be said to be working satisfactorily when skilled workers, such as the toolroom operators, feel that the present system of representation does not allow their case for differentials to be properly taken into account?
Mr. Kaufman: There is an established procedure within the union for dealing with all these matters. If the TUC can help in any way, we shall welcome its help. The AUEW has its own procedures and has made clear that it should represent the interests of its members through the established negotiating procedures.
If the hon. Gentleman is criticising the structure of worker involvement in British Leyland, he should remember that we have evolved within the firm the most advanced scheme of worker participation

33
in British industry. It is a pity that not all the workers there have availed themselves of the participation system.
Mr. Rooker: Will my hon. Friend treat with great suspicion the motives of hon. Gentlemen opposite who seek to undermine British Leyland and who drive into our underground car-park every day in foreign-built motor cars? Is he aware that two weeks ago, when the leaders of the present strike came to the House to talk to some of my hon. Friends and myself, they showed themselves to be the most moderate and sensible bunch of shop stewards and that they gave us chapter and verse on what they had done in the past two years, through the machinery within their own trade union and with the company, to avoid the situation that has now arisen?
Is he aware that internal negotiating procedure at British Leyland has broken down and failed them and that, in many respects, their own union has failed them because they have been refused meeting after meeting—
Mr. Speaker: Order. This is not the time to argue the case. It is a Private Notice Question. I propose to allow only two more questions, because there is a lot of other business. May I say to the House as a whole that hon. Members are increasingly tending to argue the case instead of asking a question?
Mr. Kaufman: I agree with my hon. Friend that the motives of the Opposition are, at best, obscure. For example, I recall that when the Leyland rescue took place two years ago, the solution of the hon. Member for Cirencester and Tewkesbury was to put the whole company into receivership. [Interruption.] It is a great pity that hon. Members opposite, with their bogus pretence of treating this matter seriously, do not stop their idiotic mutterings while I am trying to answer a serious question.
I agree that the shop stewards are arguing a serious point. When I met the shop stewards at Solihull for more than an hour on Friday we had a serious discussion about this problem. No one would dispute that the problem is serious. We are saying that if there are problems within a union about negotiating procedures, the appropriate way of dealing with them is not for the workers to
34
put 30,000 of their fellow workers out of a job but by sorting out the procedures within the union and, in the meantime, allowing full production within Leyland. Last week, the company produced only one third of its scheduled programme. If Leyland does not achieve its programme, it will not be a question of heavy-handed punishment from the Government. Leyland will bleed to death.
Mr. Stokes: Is the hon. Gentleman aware that, despite the general unpopularity of car workers, I believe, from personal experience, that there are many good Englishmen working in British Leyland? Is he aware that they need better management and better shop stewards and that they will not get the latter unless the mass of the work force takes the trouble to turn up at trade union meetings?
Mr. Kaufman: Wider participation in trade union activity is very much to be welcomed. The hon. Gentleman is correct in saying that it is wrong to depict the mass of Leyland workers as work-shy people who do not want to get on with the job. Anyone who watched television yesterday will have seen workers being interviewed and saying time and again "We want to work." The vast majority of workers want to attain the production targets and to make the company viable. We hope that their colleagues who are on strike will use the established procedures and allow full production to be resumed.
Mr. Anthony Grant: Can the hon. Gentleman assure us that the directors of the company are not in breach of their statutory obligations under the Companies Act by trading while insolvent?
Mr. Kaufman: Yes.

CONSOLIDATED FUND BILL (BALLOT)
Mr. Speaker: I have a brief statement to make. For the debate on Monday 7th March on the Second Reading of the Consolidated Fund (No. 2) Bill, hon. Members may hand in to my office by 9 o'clock on the morning of Friday 4th March their names and the topics they wish to raise. A Ballot will be carried out, as on the last occasion. An hon.

35
Member may hand in only his own name and one topic.
The Consolidated Fund (No. 2) Bill includes certain Defence Supplementary Estimates for the current year, as set out in House of Commons Paper No. 139, certain Civil Supplementary Estimates for the current year, as set out in House of Commons Paper No. 140, the Supplementary Estimates Classes 1 to 17 for the current year, as set out in House of Commons Paper No. 173, and excesses in Civil and Defence Estimates for 1975–76, as set out in House of Commons Paper No. 185.
It will be in order on the Second Reading to raise topics falling within the ambit of the expenditure proposed in these papers. I shall put out the result of the Ballot later on 4th March.
Mr. George Cunningham: On a point of order, Mr. Speaker. Will you consider for later occasions when you have this kind of statement to make choosing an earlier day than that which you have chosen for the drawing of a Ballot and announcing the result? It is inconvenient both to hon. Members and to Government Departments—which is not unimportant, especially when the date in question is a Friday—to know so late the order of the subjects that are to be taken. I am sure that you will be free on your say so to advance the date by 24 hours without taking the matter to the Procedure Committee. I hope that you will consider that.
Mr. Speaker: I am obliged to the hon. Member. Naturally I shall give consideration to what he has said. I had hoped to make the statement last Thursday afternoon. The House may have forgotten, but I have not, that statements and questions went on until 5 o'clock, and I overlooked this matter. I am sorry for that, and I shall endeavour to give more notice in future and to have the Ballot earlier.

EUROPEAN COMMUNITY (MEETINGS OF COUNCIL OF MINISTERS)
The Minister of State, Foreign and Commonwealth Office (Mr. Frank Judd): With your permission, Mr. Speaker, I shall make a statement about business to be
36
taken in the Council of Ministers of the European Community during March. The monthly forecast for March was deposited on 23rd February.
The Heads of Government of the member States will meet in Rome on 25th and 26th March. It is too soon to forecast what subjects are likely to be discussed. At present seven meetings of the Council of Ministers are proposed for March. Foreign Ministers will meet on 8th March; Finance Ministers on 14th March; Agriculture Ministers on 14th and 15th March and from 25th to 27th March; Development Ministers on 22nd March; Energy Ministers on 29th March; and Research Ministers on a date still to be decided.
At the meeting of the Council on 14th and 15th March, Agriculture Ministers will undertake detailed examination of the Commission's common agriculture policy price proposals for 1977–78. This will be followed by an additional meeting of the Agriculture Council from 25th to 27th March when it is hoped that it will be possible to take decisions on the prices package.
At the Foreign Affairs Council Ministers will discuss preparations for the European Council in Rome on 25th and 26th March. Ministers may also consider fisheries matters, and the Community's relations with Portugal, Japan, Spain and Cyprus. Other matters that may also be considered are the preparations for further work in the Conference on International Economic Co-operation; the Community's position for the Common Fund Conference; and the Belgrade Review meetings of the Conference on Security and Co-operation in Europe.
Ministers at the Finance Council will consider their preparations for the European Council. They will also undertake a quarterly review of the economic situation in the Community and will consider medium-term economic policy, with special reference to its implications for employment. They will discuss international financial questions in preparation for the meeting of the Interim Committee of the International Monetary Fund and will review negotiations with developing and less-developed countries in the context of the Conference on International Economic Co-operation and the United Nations Conference on Trade and

37
Development. The Ministers will also consider export policy.
Energy Ministers are likely to discuss some of the topics in the first half of the 1977 programme of work which was agreed at the December Energy Council.
At the Development Council Ministers will consider Community financial and technical aid to non-associated countries, EEC emergency food aid, food aid strategy, co-ordination and harmonisation of member States' aid policies and aid to non-governmental organisations.
Research Ministers will discuss the siting of the Joint European Torus and the multi-annual programme for the Joint Research Council.
Mr. Hurd: I thank the Minister for that statement and I also congratulate him on his appointment. I hope that he will find his post a congenial sphere in which to shine.
At the Energy Ministers' meeting, will the British Minister be maintaining the previous demand for a minimum selling price?
At the Summit meeting, at which the Prime Minister will be in the chair, will the Heads of Governments be putting their weight behind proposals such as those put forward by the Commission to fix farm prices at a level that is likely to rule out the accumulation of future surpluses? Does he accept that unless the matter is tackled at that level the discussions will become bogged down as they have so often before.
Will the Heads of Governments be reviewing the progress made by member States in carrying out the agreement to try to hold direct elections to the European Parliament in May or June next year? Is the Minister aware that it is exactly one year since the Government produced their Green Paper on the subject and during that year no salient fact has changed and that nothing effective has been done in this country? If that represents the Government's best endeavours, what can we expect from their worst endeavours? Why are the Government so determined for us to be the drop-outs of Europe in that context? When can we expect to see the Bill promised by the Lord President in the Queen's Speech for direct elections to the European Parliament?
Mr. Judd: I thank the hon. Member for his introductory friendly remarks. I look forward to this intriguing and exciting challenge.
The items to be taken at the energy meeting will probably include the rational use of energy, a minimum safeguard price for oil, reduced consumption in the event of oil supply difficulties, the coal situation in the Community and the Euratom loan scheme.
The hon. Member questioned me about the Government's attitude towards surpluses. My right hon. Friend the Minister of Agriculture, Fisheries and Food is at present in Brussels. One of the things that he will be discussing is the current deep concern which exists in all parts of the House and throughout the country about such surpluses. The Government's major concern is to see real restraint on prices while taking into account our aim to increase home food production. The new President of the Commission has pointed out that the interests of consumers must be considered. We support that. Our objective is to contain prices within those sectors where there are expensive and wasteful surpluses. We want a better use of resources so that the CAP provides effective support for efficient producers without imposing excessive burdens either on consumers or on taxpayers.
The Government intend to publish a White Paper in response to the reports of the Select Committee on Direct Elections. This will set out the issues with which we are faced. It will be a White Paper with green edges. We want to hear people's views, and an early debate on the White Paper will have to be arranged. Meanwhile, I confirm that the Government remain completely committed to use their best endeavours to meet the target date for direct elections to the European Parliament in May or June 1978.
Mr. Geraint Howells: On behalf of my colleagues I wish the Minister well in his new appointment and in his deliberations.
Is the Minister aware that many producers and consumers in this country are worried about the lateness of the price review proposals being made public? Can he give an assurance that the proposals will be made public in March or

39
April? Will the Minister make a statement on the European butter mountain?
Mr. Judd: I have just said that my right hon. Friend is in Brussels and I have indicated our general approach to surpluses. I am sure the hon. Member will want to table a Question to my right hon. Friend on that issue and he is free to do so. It is unlikely that prices will be determined before the meeting on 25th–27th March.
Mr. William Hamilton: Is my hon. Friend aware that, on whatever side of the argument on the Common Market one may be, the whole country is outraged by the selling off of this butter to the Soviet Union? As far as I know, the Soviet Union does not belong to the Third World. If it did, it still should not get the butter that our consumers should have. Surely the time is now opportune for this House to have a full-dress debate on the application of the wretched CAP to consumers in this country to let our colleagues on the Continent understand that we cannot put up with it much longer?
Mr. Judd: In view of my hon. Friend's deep commitment to European matters, we listen very attentively to all that he says on that score. We recognise full well that there is deep concern on both sides of the House and, indeed, throughout the country over this matter. I repeat what I said in answer to a previous question: we want a better use of resources so that the CAP will provide effective support for efficient producers without imposing excessive burdens on either consumers or taxpayers.
Mr. Donald Stewart: Is the Minister aware that the reference in his statement that
"Ministers may also consider fisheries matters"
sounds appallingly weak and confirms rumours that the Government have thrown in their hand about pressing for a 50-mile exclusive limit? Will he confirm that the Ministers will press for discussion of a 50-mile exclusive zone at the meeting in Rome?
Mr. Judd: The hon. Gentleman should know that we constantly have fisheries policy under review. We are well aware
40
that a satisfactory conclusion has not yet been reached. We are determined to keep the need for a common fisheries policy which meets Britain's special needs right at the top of our priorities.
Mr. Spearing: Does my hon. Friend realise that, whatever their views, Labour Members wish him well in his exacting task? Will he tell us whether on 25th and 26th March the Foreign Secretary will be representing this country with the Prime Minister in the chair? On 8th March, when he meets Foreign Ministers in preparation for that Summit, will he make clear to them that the origin of the powers of this House lay partly in consultation before legislation and that any consultation on EEC matters which was taken away from this House by direct elections to the European Assembly could only damage the historic and fundamental powers of this House? Will he also tell them that that was not in the literature at the time of the referendum so that they may understand the Government's position at the Summit meeting?
Mr. Judd: There is no more committed guardian of the interests of this House and of British democracy, as he sees it, than my hon. Friend. I am sure that, whatever the views of people on the issue of Europe and European institutions, everyone respects him for the consistent commitment that he has brought to debates on the subject. Certainly we shall bear in mind everything that he said.
I understand that the Foreign Secretary will be accompanying the Prime Minister to the meeting at the end of March.
Mr. Scott-Hopkins: Referring to direct elections, will the Minister tell us when we shall get the White Paper tinged with green or some such colour? Is there any reason why it should not be within the next week? The Government have had over six months to contemplate the matter. Surely they should have come to a conclusion, even on the basis of this White Paper, by now? Are they still going to drag their feet and be labelled as such throughout Europe?
Mr. Judd: As long as there are no problems about the supply of green ink, I imagine that we shall have it just as soon as possible.
Mrs. Dunwoody: Is my hon. Friend aware that the new President of the Commission has said that the common agricultural policy has been vindicated? Therefore, when the Minister of Agriculture goes to the Council of Ministers, will he make it plain that, if this country is to meet two more accession price rises before the end of the year and a considerable revaluation of the green pound, consumers in this country will be paying a rate for dairy produce which will be totally unacceptable and will lead to even greater surpluses which will have to be disposed of elsewhere?
Mr. Judd: I note what my hon. Friend said. We recognised the grave misgivings in this House. I repeat that we are determined to protect the interests of British consumers within the context of the future of the CAP. The kind of points made by my hon. Friend will be borne in mind.
Mr. Dykes: How many weeks will be needed after publication of the White Paper for the introduction of a Bill on direct elections?
Mr. Judd: That is a question for my right hon. Friend, as I am sure the hon. Gentleman recognises.
Mr. Skinner: Will my hon. Friend convey to Ministers across there that large sections of the British public will never accept Britain's membership of the Common Market and that that is increasingly being shown on these Benches, if not on the Opposition Benches? Will he, in answer to the hon. Member for Mid-Oxon (Mr. Hurd), who spoke on behalf of the Opposition, point out that, as for being drop-outs, the sooner we drop out of this ramshackle organisation the better? This latest business about the butter only goes to prove what a ramshackle outfit it is.
Mr. Judd:I fully recognise the strength of my hon. Friend's views and the vehemence with which he characteristically expresses them. We are concerned with trying to work with our colleagues in the Community in making the best of the opportunities which present themselves.
Mr. Channon: Does the Minister agree that, whatever one's views about the desirability or otherwise of direct elec-
42
tions, it is wholly unsatisfactory that the British Government have not yet made their position clear? Will he undertake this afternoon that the White Paper will be published at the earliest possible opportunity, that there will be a debate at the very earliest opportunity, and that we shall see the Bill before Easter?
Mr. Skinner: The hon. Gentleman wants a job as well.
Mr. Judd: I have said that we shall publish the White Paper just as soon as possible. I should also say, in the best possible spirit, that one thing which the Government have in common with the Opposition is a deep commitment to the principles of democracy. Therefore, we feel that, on a crucial issue of this kind, a White Paper is highly appropriate.
Mr. Bidwell: I wish my hon. Friend the best of luck in his new post. I think that he will certainly need it.
Who, other than the British representatives at the next Council of Agriculture Ministers' meeting, will be representing the consumers of Europe?
Mr. Judd: At the Council of Agriculture Ministers' meeting and elsewhere we shall be working with our colleagues to get the best possible solution in the interests of the Community as a whole, having very much at heart the fact that the British population is very much a part of that Community.
Mr. Rost: Should not the Secretary of State for Energy be instructed to drop his totally irrelevant pursuit of the minimum support price for oil since the price demanded is about half the current price and is unlikely to drop anywhere within that range? Instead, should he not concentrate on getting an agreement on the siting of the Joint European Torus project, which is far more relevant and important?
Mr. Judd: On the first point, I hope that the hon. Gentleman will have a word with his right hon. and hon. Friends, because they do not seem to have the same view on this matter. I should be interested to know the uniform view, if there is one, of the Opposition on this matter.
On JET, I assure the hon. Gentleman that our position and understanding of the

43
view of the House is that this should, if possible, be at Culham.
Mr. McNamara: Is my hon. Friend aware that many hon. Members respect the care and consideration which the Government will have to put into the preparation of the White Paper, but eagerly look forward to debating it after the Summer Recess? What is the Government's attitude to the Common Fund?
Mr. Judd: I am sure that the House will keenly look forward to debating the White Paper at the first possible opportunity.
The Government's view on the Common Fund has frequently been expressed. We are not convinced that that is the right approach to the international management of commodities. We shall go to the preparatory conference with an open mind in the best possible spirit to probe the idea in more detail so that we can consider whether in some form it has a part to play.
Mr. Marten: Will the hon. Gentleman ask the Minister of Agriculture when he meets his colleagues on 14th March to express to them the now commonly held view that it is waste of time to fiddle around with the reform of the common agricultural policy and that people want its abandonment followed by a national agricultural policy as the only real way to get down to brass tacks?
Mr. Judd: We are well aware of the hon. Gentleman's strong views on these matters. I do not believe that he shares absolute unanimity with his hon. Friends, but his views are to be considered in the context of our approach to the CAP. One of our objectives—as I have already said in answer to a previous question—is to encourage the maximum home production of food.
Mr. R. C. Mitchell: Does my hon. Friend expect the Research Ministers at their March meeting to take a final decision about the siting of JET? Is he aware of its fundamental importance in that the whole project may be lost if there is any further delay on the question of where it is to be sited?
Mr. Judd: I can understand my hon. Friend's anxiety about the delay, but I
44
hope that there will not be any unnecessary further delay because I want the decision to be as soon as possible.
Sir John Rodgers: Could the Minister tell us whether, either direct through the Government or through our representatives at Brussels, any attempt has been made to use the surpluses to the benefit of the housewives of the nine countries instead of selling them, as is being done at present, to the Soviet Union at a great discount?
Mr. Judd: I am grateful that the hon. Gentleman has raised this question. It is indeed our objective to see that surpluses are used for the benefit of members of the Community, including our people, rather than for people outside the Community.
Mr. James Johnson: I wish the Minister a fair wind in his new post. Does he not think he was a little Delphic when he said that he could say nothing about the business at the forthcoming conference? Could he not say a bit more about what he intends to do about fishing limits? A delegation of the chairmen of the Back-Bench Fishery Committees discovered little or nothing when we visited Brussels in the middle of last week.
Mr. Judd: There has been a good deal of progress; for example, negotiations have begun with the Soviet Union and with Poland and will shortly begin with East Germany. There are other third country negotiations going on. An agreement has been signed with the United States of America, but primarily we are concerned to get the right common fisheries policy overall and that must take into account the special needs of the extensive communities in Britain depending on the fishing industry.
Mr. Tim Renton: Concerning direct elections, we are promised a White Paper with green edges, which is highly unsatisfactory, but what have the Government been doing since they published the Green Paper with white edges 12 months ago?
Mr. Judd: They have been considering a complex issue with great seriousness. I am certain that the hon. Gentleman would be the first to agree that when one is considering a constitutional change

45
of such significance it should not be impetuously rushed.
Several Hon. Members rose—
Mr. Speaker: Order. I shall call in turn the three hon. Members who are on their feet. We shall then move on to the Standing Order No. 9 application.
Mr. Christopher Price: Is my hon. Friend aware that most people this side of the Chamber think that he has the pace of direct elections just about right but that he must be careful not to rush it? May I ask him to bring his attention towards the problem of Cyprus and the talks which will at last be taking place? Is he further aware that these talks ought to have taken place two years ago? Therefore, it is quite unjustified for the Government to refuse to negotiate on economic matters with Cyprus. Is my hon. Friend aware that Cyprus will have no economic relationships with the Community if some agreement is not reached by 30th June? Will he do the best he can to make up for lost ground by ensuring that an agreement is reached quickly?
Mr. Judd: My hon. Friend will be relieved to know that we expect the Council of Ministers at its meeting on 8th March to consider the possibility of further developments on the EEC association with Cyprus.
Mr. Ioan Evans: At the meeting on 22nd March on overseas aid Ministers will, I understand, consider harmonisation of member States' aid policies. How will these proposals affect existing British policies in that regard?
Mr. Judd: The British key priority in development policy is to see an extension of the Community's commitment to the non-associates. One would hope that in the context of discussions about harmonisation this will be looked at, but we are also hoping that in the talks on harmonisation it will be possible to look at more effective coordination in the developing countries on the part of various EEC member countries and also to see a more closely co-ordinated approach within world-wide international agencies such as the United Nations system.
Mr. Heffer: As just about everyone in the House accepts that the butter
46
mountain is an absolute scandal and as no one is defending the CAP, is it not time that the Government went to the talks and said categorically that unless there is an immediate beginning of renegotiating the whole question of the CAP, Britain will refuse to continue to participate in the present madness?
Mr. Judd: My hon. Friend is putting the case very forcefully. My hon. Friend knows the Minister of Agriculture well, and I imagine that he need have no hesitation about the strength with which our case will be deployed.

BRITISH LEYLAND MOTOR CORPORATION
Mr. Hal Miller: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration; namely,
"the situation at British Leyland following the refusal of the toolroom committee on Saturday morning to recommend a return to work on the advice of their union."
Since giving you notice of my intention, Mr. Speaker, I have been further advised that the local union officials met the toolroom leaders this morning but were unable to persuade them that the union should be allowed to address the shop floor membership. The meeting called for that purpose had to be postponed.
I submit that the matter is specific because of the refusal of the toolroom committee to recommend a return to work. It is important to my constituents—about 10,000 of whom work for British Leyland—and it is important to the whole of British Leyland. It is important to the motor industry as a whole, and there are many other skilled workers waiting in the wings to see what will happen. It is important to the whole future of the Government's pay policy and it is important to the whole of their industrial strategy.
It is urgent because an impasse has been reached. The union executive is willing to make representations to the Government, and indeed Mr. Duffy offered to negotiate the differentials on their behalf, but the union and the company cannot envisage the establishment of

47
another negotiating unit. As The Times commented today, it is necessary for some outside body to intervene to resolve this impasse, otherwise there is a very real risk of the breakdown of the whole production at Leyland. At present 33,000 are out of work, and if this continues for another week the whole 140,000 will be out of work.
It is also urgent because of the difficult position of the company. It is solvent at the moment, but, with the loss running at £17 million a day, one wonders how long the company will be in a position to meet its liabilities as and when they arise.
It is most urgent to get across to the toolmakers involved, who have so far not had the picture put to them by their union, because they are frustrated at their low rate of pay, which is lower than secretaries and truck drivers in the company, that something will be done in the next phase of the pay policy to resolve their problems. If that is not done, the Leyland conveners combined policy—as reported in The Times today—is to seek to use this store of justified anxiety as a pretext for an all-out strike, under the auspices of:
"the Communist-led Liaison Committee for the Defence of Trade Unions,"
to bring down the pay policy and the Government. I submit that the matter is urgent and is more important than the
48
remainder of the business due to be discussed this week, and it is clearly specific.
Mr. Speaker: The hon. Gentleman asks leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he thinks should have urgent consideration: namely,
"the situation at British Leyland following the refusal of the toolroom committee on Saturday morning to recommend a return to work on the advice of their union."
As the House knows, under Standing Order No. 9 I am directed to take into account the several factors set out in the Order but to give no reasons for my decision. It is not for me to decide the importance of the issue.
I listened with great care to the exchanges in the House this afternoon. The situation is fluid and I am giving the answer for today. I have to rule that, in my judgment, the hon. Gentleman's submission does not fall within the provisions of the Standing Order. Therefore, I cannot submit his application to the House.

WELSH AFFAIRS
Ordered,
That the matter of Transport and Communications in Wales, being a matter relating exclusively to Wales, be referred to the Welsh Grand Committee for their consideration.—[Mr. Foot.]

ORDERS OF THE DAY

  SUPPLY
  [9TH ALLOTTED DAY]—considered
  Mr. Speaker: I draw attention to the fact that this debate will last two hours and 40 minutes. Four Front Bench speeches will be made in that time. Therefore, I hope that hon. Members will appreciate the difficulty that faces anyone in this Chair in calling Members to speak.

WALES
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Tinn.]
4.23 p.m.
Mr. Nicholas Edwards: We have arranged this debate in Opposition time for three reasons: first, because we thought it right that, after all the discussion about devolution, we should return to the issues that really concern the people of Wales—the economy, unemployment, inflation, and the price paid—
Sir Raymond Gower: On a point of order, Mr. Speaker. I apologise to my hon. Friend for interrupting him. You, Mr. Speaker, made a statement, quite rightly, about the time available in this debate. Is it not appropriate that, if there is to be some sacrifice of time, it should be shared by Back Bench Members and Front Bench Members alike?
Mr. Speaker: I gave as broad a hint as I could.
Mr. Edwards: We should be discussing the economy, unemployment, inflation and the price paid for economic mismanagement in terms of social cut-backs.
The second reason is that, on the eve of St. David's Day, it seemed appropriate to debate Welsh affairs. Wales used to have an annual Welsh day debate at this time. These days, the Government put it off until the tail end of the Session, and then only late at night on a Friday. It is right that we should debate Welsh
50
affairs in the middle of the Session as we approach the end of the financial year and on the eve of the Budget.
The Secretary of State for Wales (Mr. John Morris): There has been no tradition in the time that I have been a Member of the House for this debate to be held at any particular time of the year. The time has varied with administrations.
Mr. Edwards: We used frequently to have debates at about this time, and on the last two occasions the Government have fobbed us off with a debate at an unsatisfactory time at the tail end of the Session. The Secretary of State knows that full well. The third reason is that today the Secretary of State will be celebrating the third anniversary of the election victory which placed him in office, and it is right that we should at this time examine the three years of his stewardship and seek to understand why his celebration will be a solitary affair, not shared by the people of Wales.
The unemployment figures may be taken as a gauge of the achievement of the Secretary of State. He took office when there were 38,000 out of work in Wales. He sought re-election eight months later when there were 40,000 out of work—not then blaming his inheritance, not—then forecasting disaster, but promising, according to the Welsh Labour Party manifesto, that Labour would continue
"to build on the firm foundations which it has already laid",
and that it would provide
"even more jobs and a wider range of jobs".
In May 1975 we had the first of this series of debates on the Welsh economy. There were then 51,000 out of work, and, no longer faced with the necessity of winning an election, the Secretary of State told the Welsh Grand Committee that unemployment would continue to rise for some months to come. He was right: it did.
In October 1975 we had a general debate on Welsh affairs. Unemployment had by then risen to 69,000. All my figures are on the new basis that excludes adult students and are therefore flattering to the Government.
By January 1976, after nearly two years in office, the Under-Secretary of State

51
began to feel that pessimism was just a little bit out of place. Opening another debate on economic affairs, he told us that
"an encouraging start has been made in tackling our deep-rooted economic problems."—[Official Report, Welsh Grand Committee, 21st January 1976; c. 21.]
Unemployment by then had reached 77,000—almost exactly double the figure that he had inherited 23 months before. Clearly the Under-Secretary of State had a unique concept of what is encouraging.
By November last year we were debating Welsh affairs against a background of about 80,000 unemployed. Today, as the Secretary of State celebrates the third anniversary of his assumption of the trappings of office, Wales suffers with 81,000 on the dole.
Every debate that we have had has marked a pitiless rise in the number of people out of work in Wales. In each debate we have had a declaration by the Secretary of State that the situation is unacceptable. Each debate has echoed to his increasingly shallow excuses. I imagine that he will celebrate this third anniversary by once again blaming it all on someone else.
I shall have more to say about unemployment later in the debate, because the overall figures mask the scale of the catastrophe that the Labour Government have imposed on parts of Wales. But first there are other aspects of the economy to examine, because the Secretary of State has repeatedly told us that his Government's prime task is to check inflation. In January last year the Under-Secretary of State boasted that
"the rate of inflation is falling. Indeed, we are on target to achieve 10 per cent. by the autumn".—[Official Report, Welsh Grand Committee, 21st January 1976; c. 9.]
At the same time the Chancellor of the Exchequer was promising single-figure inflation by this year. In November the Secretary of State was careful to avoid the future, but he took credit for halving the rate that his Government had previously more than doubled.
Today single-figure inflation has receded over the horizon. On the Chancellor of the Exchequer's basis of 8·4 per cent. in October 1974, the inflation rate today is 23 per cent., and the Government continue to forecast an annual rate of 15 per cent. That means for the
52
housewife that there has been an increase in prices since the Government took office of 65p in the pound, and at a time when personal income tax—that is, the tax paid by the average family—has more than doubled. Therefore, the consequence of the economic policies followed by the Government—the reward for the sacrifice of 81,000 Welshmen·is inflation at double the rate of our competitors overseas.
The same dismal story is revealed by the index of industrial production for Wales. When they came to power, the Government boasted that they got Britain back to work, but the fact is that Welsh industry is producing less today than it did in the first quarter of 1974. It is producing less than it produced as far back as 1971. Britain at work under Labour produces less than it produced in a three-day week.
No doubt the Secretary of State will plead that things are a little better than they were in the dismal trough of 1975, but the recovery of the first quarter was not sustained later in the year and the forecast on which the Chancellor based his spring Budget will not be fulfilled. Perhaps when he assumed office the Secretary of State wished to be remembered for something, and I suppose that it is some kind of grisly record to be a member of an Administration which, over a period of three years, has achieved and then maintained record inflation, record taxes, record unemployment, and an unprecedented fall in industrial production.
No doubt we shall have the usual tear jerking stuff this afternoon about how hard it has been to bear and how determined the right hon. and learned Gentleman is that one day it will all be different. We have had it all before. Three years is enough for anyone.
I return to the subject of unemployment, which was running at 8 per cent. in January and 7·8 per cent. in February, or on a seasonally adjusted basis, 7·3 per cent. in January and 7·2 per cent in February. In parts of Wales the situation is much worse. In several of the valleys of Glamorgan it is 10 or 11 per cent. and in Wrexham, in spite of the success in developing its industrial estate, it is more than 10 per cent., but in the Western peninsulas things are on a different scale altogether. In the North unemployment is at more than 14 per

53
cent. In Anglesey and in Blaenau Ffestiniog it is 14·1 per cent.
If that is bad, the situation in the South-West can only be described as shocking. In the constituency of the hon. Member for Cardigan (Mr. Howells) it is between 17 and 20 per cent., and in my constituency in January it was 15·7 per cent. in Fishguard, 21·1 per cent. in Milford, 19·1 per cent. in Pembroke Dock, 20·8 per cent. in Tenby. The situation was only marginally better in February. Matters have achieved a crisis condition when male unemployment in a whole group of neighbouring employment areas rises to well over 20 per cent., more than one in five of the male insured population out of work.
A look at the map of development areas in Wales indicates the illogicality of the present position. By far the most grievously affected area of Wales has not been granted special development area status. One of the most seriously threatened areas, the North-East, is designated only as an intermediate area. The Secretary of State will know, and he will not be surprised, that local authorities in West Wales have demanded that the Milford and Pembroke Dock employment exchange areas should have special development area status, and should be the subject of increased investment and promotional activity.
This debate will give the Secretary of State an opportunity to respond to that demand. He should realise that it is not just a question of percentages but that the total number of out of work is alarmingly high. There are more unemployed in Pembrokeshire than in the cities of Swansea and Newport or in the group of employment exchanges around Ebbw Vale. Furthermore, there is the threat hanging over us of British Rail's decision to terminate the Fishguard to Waterford cargo service. I shall have more to say about that when we debate transport in the Welsh Grand Committee shortly, but we should now concentrate on the future rather than arguing about the failure of British Rail's management over the last two decades. Those now in command are revealing commendable determination to make a success of the port. The closure of Fishguard, with its consequences for employment and economic activity in North Pembrokeshire and the future of the whole West
54
Wales railway service, is too awful to contemplate.
The Government have refused an inquiry into the activities of the shipping division out of Fishguard, and therefore they have a clear obligation to satisfy themselves completely with the figures submitted by British Rail to ensure that every possible step is taken to guarantee a successful future for the port. The whole future of Fishguard lies in the hands of nationalised industries, but in three other parts of Wales the Government would be misleading the people if they pretended that this was so. The fates of Port Talbot, Shotton and the South Carmarthen power station, each important in its own way, are all dependent on Government decisions. When I visited the Welsh Development Agency and inquired what action by the Government would most immediately assist it in tackling the industrial problems of South Wales, I was told that in the Eastern valleys it wanted to see urgent improvements to the stretch of road between Raglan and Abergavenny, which would do more than anything else to improve access.
In West South Wales, the Agency had no hesitation in calling for a decision on the investment programme at Port Talbot, not just for the future of the steel works itself, but for the future of literally hundreds of companies which are dependent on it. The hon. Member for Gower (Mr. Davies) has spoken in successive debates about the crisis facing the tin plate industry, growing fears among tin-plate workers and the critical importance of this industry for the economy as a whole.
During a visit to a Swansea firm I found a small but significant example of the absurd situation in which we find ourselves. The factory was originally established in Swansea because of its proximity to Port Talbot, but it is now getting none of its steel from that source, and has to get some from Germany, since Port Talbot does not produce the hot-rolled coil required. The Port Talbot decision has been almost grotesquely mishandled by the Government. It has become a sort of symbol of how not to manage our industrial areas. If we want to guarantee failure as a nation, we shall spend three years shilly-shallying over

55
major investment decisions, as the Government have with this one, and arrive at political conclusions on economic issues which are illogical and indefensible as is the Government's interim authorisation of half the investment programme demanded by the British Steel Corporation.
The cry goes up all over Wales that the BSC should go ahead with the £350 million investment programme, which will increase the price of the product, because people see that as the only way to force the Government to agree to an essential part of the programme which would increase Port Talbot's steelmaking capacity. That is an unreasonable demand to make of the BSC. Before it proceeds with the new strip mill, coke oven and continuous casting machine, the BSC is entitled to know whether it is to become a 6 million-ton plant.
Nothing is worse for industrial confidence and the economy than indecision. On steel we have had three years of indecision and Welsh industry has been blighted as a consequence. There are rumours around that at long last, almost unbelievably, the Government may be on the point of taking a decision about Shot-ton. Perhaps the Secretary of State will announce it this afternoon. It is hard to to see any reason why he should delay any longer. I find it hard to believe that Shotton will not be permitted to live, but whatever its fate people are entitled to know, and the failure of the Government to tell them is shocking and in defensible.
I regret the absence due to illness of the hon. Member for Carmarthen (Mr. Evans) and wish him a speedy recovery from his operation. I raise the question of Carmarthen Bay power station not only because of the bleak employment prospects of the Burry Port without it, but because I think we are entitled to know the results of the consultations announced by the Secretary of State for Energy in 1975 about the inter-relationship with coal mining and the demand for coal in generating electricity. We now have the remarkable and disturbing situation in which all the coal being burned at Burry Port comes from not the NCB but from 10 licensed pits which can sell it more cheaply. There has been a series of disastrous setbacks in the process of
56
getting the Aberthaw coal-fired station operational. The National Coal Board has a stockpile of a million tons of low-volatile Welsh coal and is increasing its stocks at the rate of 6,000 to 7,000 tons a week.
What is at stake is not just the future of the power station, but the fate of three NCB mines and about 10 licensed pits. Whatever the economic arguments for closing the remaining four generating sets at Burry Port power station, there may be a case for making adjustments to the price structure so that the stockpile can be burned. It is almost certainly useless anywhere other than at the Aberthaw and Burry Port power stations. In that way we can use this energy resource in that part of the South Wales coalfield.
I have received representations from local authorities, management and the unions and so, I know, have the Government. While this is primarily a matter for the Secretary of State, the economic and social consequences are important in the South Carmarthenshire area. I think it reasonable to ask the Secretary of State to remove some of the anxieties that now exist.
In my speech I have repeatedly referred to anxiety and uncertainty and to the importance of these factors on industrial confidence and investment. I cannot recall a time of greater uncertainty over the prospects for agriculture. In conversations with farmers as far apart as Pembrokeshire, Clwyd and Brecon I found a mood of bewilderment. There is difficulty in calculating the consequences for farm prices of the European Commission's proposals, but, more important, there is no way of knowing what the final decision of the Council of Ministers on these proposals will be. If accepted, they might form the basis on which farmers can plan with some certainty and not entirely without a hope for the future.
However, those engaged in agriculture have heard with apprehension the comments by Mr. Jack Jones and others on any green pound devaluation and the cryptic statements by the Minister. Above all, they demand to know what the decisions are. It is getting very late for farmers to plan their pattern of expenditure, and if there is to be a retrenchment they want to know. If, on the

57
contrary, the Government want farmers to make the contribution of which they are capable, decisions must be taken which will enable them to recoup a large part of the £900 million increase in costs that they incurred last year.
The White Paper "Food from Our Own Resources" promised us expansion, but where we should have been 6 per cent. up we are 23 per cent. down. It is not a very good start. Welsh farmers, with their dependence on beef, are particularly affected by the large discrepancy between Irish and Welsh prices. Anxieties about Irish imports are understandably—and these have been referred to the right hon. Member for Anglesey (Mr. Hughes)—particularly at a time when there are still doubts about the whole future of the beef regime after the summer. The message that I am sure farmers would wish me to give to the Secretary of State is: "Remove our fears". Let us have firm decisions so that we have a firm base upon which to plan.
A firm base upon which to plan is what the small business men of Wales demand also, and it is the one thing that the Government have not given them. The small businesses have a critical part to play in the Welsh economy. Over much of Wales they represent a major sector. It is from among them that the bulk of our employment derives. It is on the foundation they provide that our future must be built.
I was encouraged in my recent conversations with the Development Agency by the realism of its approach. It sees little prospect of attracting major investment projects to Wales in the immediate future. It does not look to any massive injection of overseas capital. Instead it proposes to seek an expansion of the small and medium firms which exist in Wales. It seeks to assist them with their critical cash flow problems in these difficult times and by improving their capital base.
That is a particularly wise approach in view of the Government decision announced last Thursday. The decision was taken for a quite understandable reason, but it means that Wales has suffered another serious setback in its attempt to attract new industry from outside. News that an advance factory programme costing £12 million is to be
58
launched in the shipbuilding areas of the United Kingdom must be a serious blow to our hopes. We now face a major new element of competition in filling our empty advance factories.
Unfortunately, the Development Agency has to do its work against a background of shattered confidence, the result largely of Government actions that might almost have been deliberately designed to weaken the cash position of firms and discourage them from future investment. One day, perhaps, the Secretary of State will learn that injecting cash by means of grants or by provision of factories is no substitute for profits. It is a remarkable fact that advance factories built since 1964 have provided only 3,650 jobs for men and 2,330 for women at the last count. That is fewer than they provided a year ago.
Mr. Neil Kinnock: Does not the hon. Member acknowledge the whole lesson of history, which is that when profit was the only spur to industrial development in Wales, we had no industrial development of any kind other than the exploitation of natural resources, and when they dried up it stopped altogether?
Mr. Edwards: The hon. Member can draw whatever lessons he wishes from history. However, Government action is fruitless unless companies can produc the cash to plough back. Without that there is no prospect for the businesses of Wales, and the experience of the last two years, whatever the experience of the previous decades and centuries may prove, establishes that almost without question.
One would have thought that after three years of the kind of disaster that I have outlined to the House the Government would really have begun to realise that their approach is hopelessly at fault. No sooner had Welsh business absorbed the new payroll tax imposed in the Chancellor's summer Budget—and that was a massive blow—than it was winded again by the decision to remove the regional employment premium at one go, without warning and without consultation. That will cost Welsh industry in a full year about £32 million. We are told also that £5 million is to be handed back to the Development Agency. That blow coincided with the imposition of record interest rates.

59
Faced with this triple blow to their cash resources, dozens of Welsh firms abandoned their investment projects for the time being and although interest rates are now falling many of them will be inclined to wait to see whether they fall further still. I see that the Secretary of State looks sceptical, but this was the considered view of the Welsh Development Agency when I discussed the matter with it. It says that it is a real problem that not only has confidence been shattered but it will take some time to restore.
In a situation of falling interest rates people are bound to hold off their investment decisions. They would be mad not to do so. Why borrow money at a high rate if it seems that the money will suddenly become cheaper? The Secretary of State says that I am illiterate, but I suspect that I am not as economically illiterate as he is, and we have his record to prove how economically illiterate he is. The Welsh people are paying the price of his economic illiteracy. The right hon. and learned Gentleman now seems to be telling me to cool down, but why should I cool down when the Welsh people are suffering from his incompetence? I see that the Secretary of State thinks that this is a joke. He is laughing at the fact that there are 81,000 people out of work in Wales today. He is laughing at the economic plight of Wales, and I hope that Wales takes note of the fact—
Mr. John Morris: I was laughing at the hon. Gentleman.
Mr. Edwards: As if all that was not enough, we then have Bullock. Whatever may be the long-term effects of this disastrous report, the immediate impact will be further to discourage investment. Within the last few days I have received news of overseas companies with subsidiaries in Wales cancelling their investment plans until the threat of Bullock has been removed.
Mr. Kinnock: Oh, really!
Mr. Edwards: The hon. Gentleman may show scepticism, but I have specific instances where this has already happened. The truth is that the Government and their supporters hate to be told the reality as it affects Wales. Even worse, they simply do not begin to understand
60
the realities, and this is the tragic situation that faces the Welsh people.
So we face the situation in which the economic recovery of Wales is dependent upon confidence that does not exist, upon profits that companies are not permitted to make, and upon incentives, personal and corporate, that the Government have almost entirely destroyed. The prospect is that for another year we shall suffer record unemployment, record inflation and stagnant production. In the meantime the Government cling to office hoping against hope that something will turn up to save them. Throughout their period in office they have given more thought to their own survival than to the interests of the Welsh people.
The Secretary of State will now get to his feet and tell us of the great problems he faces. Shamelessly he will deny responsibility for what is passed and will claim credit for the recovery that he will tell us he can discern at the end of the tunnel. I suppose that the kindest thing that might be said of the Secretary of State is that he has done his best. That, on this, his third anniversary, may give him some consolation, but it will give little to the long-suffering people of Wales.
4.50 p.m.
The Secretary of State for Wales (Mr. John Morris): We all listened to the hon. Member for Pembroke (Mr. Edwards) when he began by saying that I would be celebrating three years in the Welsh Office but that it would be a solitary celebration. I think that Wales should know that the hon. Gentleman made his remarks when there were only two Tory Back Benchers in the Chamber listening to his tirade. That fact should be recorded. The hon. Gentleman has monotonously called for my resignation from the moment he was prematurely elevated to the Opposition Front Bench.
Sir Anthony Meyer: Has the right hon. and learned Gentleman just given an example of his arithmetical genius? I count three Tory Members present.
Mr. Morris: The hon. Gentleman has fallen into the pit into which I expected him to fall, because there were two Tory Members present when the hon. Member

61
for Pembroke began his speech and the hon. Member had not arrived on the Opposition Benches at that stage.
Sir A. Meyer: I apologise. I had to provide a quorum for a Select Committee.
Mr. Morris: Whatever virtue there is to the presence of three Opposition Members as opposed to two during a debate, it is an indication to the people of Wales of the interest shown in the tirade of the hon. Member for Pembroke.
Mr. Nicholas Edwards: It would not be unbecoming of the right hon. and learned Gentleman to express some sympathy for my hon. Friend the Member for Cardiff, North-West (Mr. Roberts), who is unable to he present because of ill health.
Mr. Morris: I certainly express sympathy for any hon. Member, from either side of the House, who is ill. However, if there were any justification for the vote of censure that the hon. Gentleman seemed to be adumbrating against me, I should have thought that he would have more support on his side of the House. However, it is a maximum of three.
The hon. Gentleman is under the impression that the debate is improved by the addition of insults. "Shallow excuses" were the words used; "Tear-jerking stuff". Good luck to him. We have heard such remarks from him in every debate. He came to Wales looking for a seat. However, his hectoring manner has hardly endeared him to the people of Wales. In due course he will depart from Wales and seek lusher pastures, more attuned to his qualities, in Sussex or Surrey. Long after the hon. Gentleman has left Wales—
Mr. Nicholas Edwards: Nonsense.
Mr. Morris: It is time to tell the hon. Gentleman what we in Wales think of him. He is an absentee. We know that. I have endured his insults for three years. It is right to tell the hon. Gentleman that long after he has left Wales my hon. Friends and I will represent Wales and that his party has been rejected by the people of Wales since 1850, if not earlier.
I trust that the House will understand that if I do not dwell unduly on transport today it is not because of any lack of concern on my part as to its importance
62
in the economy of Wales but because we hope to return to that matter shortly in the Welsh Grand Committee. It is to me, as the House knows, a most important key to our economy and its future.
We begin, rightly so, with the present level of unemployment. It concerns all of us. To listen to the hon. Member for Pembroke one would imagine that only the Opposition were concerned with the economic situation and unemployment. Unemployment cannot be divorced from the economic situation. It flows from it. It is not a peculiarly Welsh problem. It is not even a peculiarly British problem. Not even an Offa's Dyke, the English Channel, or the Atlantic Ocean can shelter us from the world-wide effects of a recession.
Therefore, it is right, appalled and concerned as we may be, to put the situation in its right perspective and to seek to assess what has been done. Today the Opposition were as barren and as sterile as usual in their lack of any constructive ideas. There is nothing new in that.
The reality of the situation is that the measures which the Government have introduced have directly saved 22,000 jobs in Wales. That is equivalent—the hon. Gentleman may not know it—to a little more than 2 per cent. on the unemployment roll. The work experience scheme, the youth employment subsidy, the temporary employment subsidy, the job creation scheme, and the community industry schemes have all played their part. When we add them up we are able to take account of the effect on the employment scene, and very welcome it has been.
There is nothing more disheartening than for a young boy or girl to leave school and find that there is no work for him. I take some comfort from the fact that last month's figures of school leavers unemployed had come down from 3,526 to 2,894, and this has been the trend since the very high figure of 13,200 in August 1976.
I should like to make one comment on the job creation scheme. It is apparently enhancing the prospects of being taken on in regular employment. Between 40 per cent. and 60 per cent. of persons taken on by the JCP scheme are leaving to enter permanent work.

63
The Government also attach great importance to the provision of training facilities to ensure that there is an adequate trained labour force ready for economic recovery. The number of training places provided by the Training Services Agency in Wales, mainly in its skillcentres and in colleges of further education, has been increased, and the number of people who have completed courses has risen from 3,000 in 1973 to well over 5,000 last year.
The hon. Member has mentioned the withdrawal of Regional Employment Premium, and I suspect that the subject will also be raised later in the debate. Of course it would have been very welcome if we had been able to retain it, but the Chancellor in his statement of 15th December had to take account of the overriding aim of ensuring that sterling was strengthened, and public expenditure had to take its share of the burden in he case we made for negotiating the IMF loan and funding the sterling balances.
Of course, some firms in Wales have complained about the withdrawal of REP. I understand their complaints. I have met them. I cannot understand how the hon. Gentleman has the face to complain, because he has advocated a much greater slashing of public expenditure, although quaintly he argues from time to time in favour of additional public expenditure in his own constituency. He has been fully exposed on that score. The fact is that we had a very difficult choice to make on REP, and the decision must be judged in relation to our policy of giving the highest priority to industrial investment and to expansion, as well as our measures to reduce unemployment.
In addition, the value of REP has been substantially eroded since it was first introduced in 1967. At that time it represented about 7 per cent. of average wage costs. This compares with only 3 per cent. under the equalised rates which were due to be introduced. In current public expenditure circumstances—this is what the hon. Gentleman should take account of—the Government could not consider increasing REP by the £200 million or more which would have been needed to restore the premium to its original real level. It is doubtful, therefore, whether REP would now be of much effect in generat-
64
ing and maintaining employment in the special development and development areas. Indeed, a large proportion of the payments were made to firms that would have maintained their operations in or transferred them to these areas in any event. So we decided that these payments should give way to more selective measures to create investment and employment, and an additional £80 million is being made available in each of the next two years for selective assistance to industry. These measures will include a new selective investment scheme which will play a significant rôle in fostering the growth of the identified sectors in the United Kingdom economy. I hope that firms in Wales will seek to benefit from this form of assistance to the key sectors.
Mr. Kinnock: Am I right in thinking that that £80 million is for the whole of the United Kingdom economy?
Mr. Morris: Yes, it is. But in Wales we also have in Section 7 of the Industry Act assistance to foster growth—and I shall be saying more on this later on.
In addition, more funds are to be allocated to the National Enterprise Board. The Welsh Development Agency will get an additional £2½ million in each of the next two years and more money is to be provided for sectoral schemes to improve the efficiency of particular industries. All these schemes are designed not only to promote investment but also to improve industrial performance and competitiveness. Such an improvement is essential to national prosperity. The assisted areas have already received substantial aid under existing schemes and projects in Wales will, of course, be eligible to benefit from the additional expenditure now being provided. The effects of the withdrawal of REP will also be mitigated by the extension of the temporary employment subsidy and the job creation programme, for which applications may now be submitted up to the end of April 1977, when the future of the schemes will be further reviewed, along with the other new measures to relieve unemployment which we have recently introduced.
I recognise that the notice was short, but our overriding objective was to restore confidence in sterling and particularly to get interest rates back to the levels

65
of the previous summer. Our success in this must have eased the cash flow of many firms in Wales and so will help to preserve employment and investment opportunities. It was the rationale of the Member for Pembroke that faintly amused me before and certainly not the level of unemployment, as he knew quite well. I believe that in retrospect it will be seen that our priorities were the right ones for industry.
We are at a turning point. Manufacturing investment in Wales is on an upward trend rising from 6·1 per cent. of total United Kingdom investment in 1974 to 8·5 per cent. of the nation's manufacturing investment last year, and we know that investment is expected to rise by 15 per cent. in the coming year. This is on the right lines and Welsh firms are in the front of the drive for exports. This is particularly important when home demand is sluggish.
Leading Welsh exporters have achieved significant increases of the order of 30 per cent. in their exports over the past two years. About 750 firms use the export services of my Industry Department. My officials average about 500 visits, or interviews each year. Last year there were 8,000 inquiries. What is extremely encouraging is the way firms are responding to the opportunities which are available overseas. Exporting is not easy: it is hard and unremitting work, but time and time again I was impressed by the number of firms exporting 30, 40, 50 and even 70 per cent. of their total production. It is in the firm's own interests but it is very much in the national interest, too. Very roughly, an increase of 1 per cent. in the share of world trade for the United Kingdom could in Welsh terms means 20,000 jobs.
The Development Corporation for Wales and other bodies are playing an important rôle, too. During 1976 the Development Corporation mounted five trade missions to major market areas of the world and is planning visits in 1977 to Brazil, Scandinavia, Australia, New Zealand, Japan and Hong Kong. Against this background, with the large increase in investment expected in the coming year and the inflow of North Sea oil, which will transform our balance of trade, it is no surprise to note the greater confidence expressed by the CBI in its last report. To continue this improvement we must
66
successfully renew the social contract; given success on this, there is no doubt that, after a lag, unemployment will begin to fall.
Turning to individual industries, the particularly good news has been the decision of the board of Hoover to go ahead with its investment at Merthyr. This was a problem on my desk when I took office, and I discussed it with the board at Perivale with Mr. Mansager, the then chairman, and subsequently in America. I was able to meet him again in Cardiff when he brought a top team of chief executives of some of the biggest firms in the United States of America to this country at the invitation of the then Prime Minister. My office, the Department of Industry and the Welsh Development Agency were happy to continue discussions with Mr. Rawson, his successor, and his team.
The success of this extensive negotiation and consideration by the board of Hoover was marked by His Royal Highness Prince Charles a few weeks ago performing the opening ceremony of the development at Merthyr. A tremendous amount of effort has gone into this project, and preparing the site and building the factory is now one of the major tasks of the WDA. This by any standards is a massive project for a Government agency, at a cost of over £10 million, and the overall Government contribution will be much more.
The welcome decision by Hoover, which I announced on 10th January, to proceed with their expansion at Merthyr Tydfil is of major importance from many standpoints. It will provide a very welcome boost to employment prospects in the Heads of the Valley. Perhaps the most significant aspect of Hoover's decision is the simple fact that it has shown that a major United Kingdom company—part of an international American-based undertaking—has the faith and foresight, notwithstanding the present difficult economic climate, to demonstrate its confidence in the future of the United Kingdom and the Principality by embarking on this major investment.
The steel industry, both in the public and private sectors, is undertaking major investment programmes. The Government expect very soon to receive the British Steel Corporation's plans for Port

67
Talbot and Shotton but in the meantime considerable activity is going on in an extensive programme of plant replacement at Port Talbot. I could not understand the hon. Member for Pembroke's references to the coke oven and the "con-cast" facility. The first is proceeding—the hon. Gentleman may not know it—and the second is being considered by the BSC. The total value of those two parts of the scheme is £100 million.
Major schemes to provide additional steel finishing capacity at Shotton and Ebbw Vale are nearing completion. Within the last week, the British Steel Corporation has announced plans for proposed investment of £73 million in modernising and developing finishing plant for electrical steels at the Orb Works in Newport, which will provide some 190 new jobs. The reality is that the BSC now has £330 million worth of major development in progress in Wales or recently announced.
In addition to the BSC's current investment programme, substantial expenditure is of course being incurred by the private sector of the industry in Wales. GKN's new rod mill and electric are steel plant which was opened earlier this month by His Royal Highness the Prince of Wales form the major part of a £51 million development scheme in Cardiff. This is matched by the £48 million development which the same company is undertaking at its Brymbo Works near Wrexham and also by the installation of new steelmaking plant by Duport Limited at Llanelli. These are significant and major pieces of development in Wales.
Despite the increased costs, the Government intend to support the NCB's "Plan for Coal" dealing with the situation up to 1985 through its periodic review of the NCB's corporate plan and investment programme, and, as hon. Members know, a Bill to provide for the future is at present before the House and contains important financial provisions for future investment in coal. These measures will have particular relevance to Wales, where substantial investment in the mining industry is already in hand or planned. The new mine at Betws, near Ammanford, which the Prime Minister and I visited last year, which is being constructed at a cost of £12 million, is well on schedule to come into operation in April 1978. But
68
there are other, important investments, such as those at the collieries of Treforgan, Blaenant, Aberpergwm, Windsor/Nantgarw and Oakdale, also under way.
With a £3 million project announced in January to top 6 million tons of coking coal at Lady Windsor/Abercynon Colliery, the total investment in new mining and reconstruction schemes in South Wales has reached £40 million in the last three years. I make no apology for going through the massive investment in the public sector in Wales, which plays such an important part in the Welsh economy. These are massive figures which speak for themselves.
The coal industry in South Wales still provides employment for a total of some 38,000 people. Its position in the Welsh economy is, therefore, one of prime importance and the Government are providing for and expecting the industry in South Wales to play its part in reaching the targets set. This is a major contribution, and I am sure the whole House will be delighted to hear the position with regard to the public sector.
I now turn to selective financial assistance. Since I assumed responsibility in Wales in mid-1975 I have noticed a tendency for attention to be focused on a handful of large cases. Hon. Members on both sides of the House have given me great assistance in the handling of some of these cases in the period during which I have been responsible. I want to pay my tribute and thank them for their advice and judgment as well as their advocacy for their particular areas.
I have noticed a tendency for attention to be focused on a handful of large cases, particularly those involving the rescue of undertakings in financial difficulties. I would in no sense wish to underestimate the importance of these cases, particularly in view of the large numbers of jobs involved, but it is easy to overlook the vast bulk of the cases. In many instances these involve the offer of assistance for expansion of small or medium sized firms and attract little publicity. But taken together they will have a very considerable impact on the development of industry in Wales. Some will provide the nucleus of future entrepreneurial growth and others have a particular importance for the smaller communities in which they are located.

69
Since 1st July 1975 my Department has made 167 offers of Section 7 assistance, of which 153 have been in respect of expansion, employment-creating projects. The value of the offers made during the period amounts to over £22 million. The project costs associated with these offers amount to close to £140 million, so we are getting very good value for money from this form of assistance. Indeed, a surprising number have succeeded in beating their targets. I am convinced that Section 7 assistance is an invaluable part of our armoury for bringing about economic growth in the Principality, although this inevitably must be primarily dependent on the general recovery in the United Kingdom economy.
I now turn to the Welsh Development Agency. In the first year of its existence it has naturally been concentrating on building up its organisation and carrying on with the responsibilities it took over on its inception. It has carried out wide consultations with local authorities and the Welsh TUC and CBI on general economic and industrial matters and particularly on land reclamation. I of course meet the chairman and chief executive regularly and recently I had the opportunity of meeting the full board for a full and frank discussion of a wide range of topics that go to the heart of the Agency's activities and aspirations.
The Agency's most important new function is its support, whether financial or otherwise, of industrial development. Hitherto, it has been in a responsive position, necessarily, because of the need to secure new and expert staff. Nevertheless, some 200 inquiries have already been received and over 50 of these are currently being closely examined to establish their potential contribution to the Welsh economy. The Agency has now recruited more staff and will be able actively to seek out opportunities for investment. This more positive rôle it will pursue in all sizes of ventures, but it is specifically concerned to help and encourage indigenous Welsh industry.
I welcome this particularly since we cannot at the present time count on a great flow into Wales of industry from elsewhere in Britain, or indeed from overseas. I am delighted to say, too, that both the Agency and I have received from the CBI (Wales) a warm welcome of the Agency's capacity to encourage and
70
foster the growth of Welsh entrepreneurs. My hon. Friend will give more details of its on-going responsibilities in land clearance and factory building. What a different picture from the views expressed by the Opposition when we were seeking to get through the Bill to set up the Welsh Development Agency.
We announced our commitment to and achieved the setting up of the Development Board for Rural Wales, which comes fully into effect on 1st April of this year. Its specific functions are to promote the economic and social development of its area and I would stress the importance the Government place on the social dimension. The Board's main task is to regenerate the economy by assisting the development of light industry and other sources of employment, but it will look beyond the economic factors and play a part in the social development of the area in the widest sense. While Newtown will necessarily absorb a large part of the Board's budget in its early days, looking ahead the Board will view the needs of the area as a whole and Newtown will be but one piece, albeit an important piece, of the general Mid-Wales picture. This is one of the strengths of the Board. For the first time one agency will be able to range over the whole field and pull the various threads together in Mid-Wales.
I hope that I shall be forgiven if I do not today deal with agriculture as I usually do at some length. I keep in close touch with the farming organisations and I have met them on three occasions in recent months to discuss their problems. We are now in the middle of the annual price fixing discussions and I hope to participate in the Council of Ministers on 14th–15th March in Brussels.
There are many matters on which I would wish to have commented today. In my three years as Secretary of State Wales has had to weather a severe world recession and of course it has hit employment in the Principality hard. Yet there is enough confidence in the longer-term prospects to make possible the large investment projects to which I referred earlier. But of course there have been economic problems causing concern in Wales and that is why it has been so important to discuss these problems with both sides of industry. That is why I

71
value greatly the national organisations in Wales available to me for discussion, the Wales TUC, the Wales CBI, the farming unions, the local authority organisations. Many of these bodies and organisations covering the whole of Wales are of recent origin, but they have already proved their worth.
I believe that in our investment in infrastructure in Wales—the roads, the houses, the land clearance, the factory building, the water and the sewerage, the provision of funds for nationalised industry investment, the welcome growth in private industry investment—we have laid good foundations for the future. Despite the continuing difficulties in the period immediately ahead, I have no doubt that we are building well and fairly for the Wales of the future.
5.18 p.m.
Sir Raymond Gower: In some ways I should like to congratulate the Secretary of State because he sounds much more confident about the position in Wales than anyone else with whom I have discussed this subject in the last six months. I hope that the right hon. and learned Gentleman's confidence is entirely justified. But I must warn him that those who are employed, or are in positions of experience, in many of our great industries in the Principality have not shown the same confidence about the present or the future as the right hon. and learned Gentleman has shown in his speech today.
In his opening speech my hon. Friend the Member for Pembroke (Mr. Edwards) made an incisive attack on and indictment of Government policy in recent years. I think the Secretary of State felt that my hon. Friend had made an exaggerated attack, and responded as though it was quite unjustified. In reply to that, I say only that it is not surprising that any Opposition should express concern about the state of affairs after this Government have been in office for three years. Any Opposition party, any parties in opposition, or any part of the opposition must be critical of these figures.
In my view, the figures speak for themselves. I accept that the Government have had to face difficulties, and I have no intention of being unfairly critical. I appreciate that there have
72
been world difficulties. However, some of these private enterprise countries such as Holland and Germany have been doing far better than we have.
Mr. Kinnock: Because of Tory rule.
Sir R. Gower: No. It is because they have been practising private enterprise successfully without the inhibitions of those who seek to destroy the system in this country. That is the difference.
The figures about which we are concerned are at least three or four separate ones. I suggest to the Secretary of State that an unemployment level approaching 81,000 in the Principality is one which gives rise to considerable concern, especially as regards its incidence in certain parts of the Principality. I believe that the right hon. and learned Gentleman was born in the county of Cardigan. I was there on holiday last year, and I discovered that the incidence of unemployment in that part of the country was very severe. What is more, as my hon. Friend the Member for Pembroke knows, there are appalling figures in parts of his county. I appreciate that there is never any even figure and that in certain areas it is always worse than the average. But this unemployment situation has been accompanied by a very high inflation rate, which even at present is running at 22 per cent. or 23 per cent. per annum, and this aggravates the conditions which create industrial problems and unemployment.
Then we have this problem of industrial production. Towards the end of his speech, the right hon. and learned Gentleman said that this was now showing signs of reviving and improving. I hope that he is right. The fact remains, however, that at times it has been less than it was during that often recalled three-day week of three years ago.
Mr. Nicholas Edwards: It still is.
Sir R. Gower: As my hon. Friend says, it is even at this moment.
There is also the problem of industrial investment. Industrialists and companies have been criticised. But no one can expect growing investment against the background of figures like these.
I noticed that the Secretary of State carefully avoided any reference to the plight of the construction industry in

73
Wales. I hope that he is aware of the difficulties of building companies, to say nothing of those which produce sand, gravel, cement and bricks for the building industry. The construction industry is in a very serious state, and it is not the only one. I mention it only because it has been omitted from previous discussions. I hope that the Secretary of State will do all in his power to assist the construction industry. As he knows, some smaller builders face serious problems in continuing in existence, and this is certainly not a sector of our economy where there are signs of improvement. All the indications at present are that the situation continues to deteriorate.
A generation is growing into manhood in the Principality who cannot recall those much criticised years between 1951 and 1964 when, on the whole, the standard of living improved steadily for the majority of our people.
Mr. Cledwyn Hughes: The hon. Gentleman always seeks to be fair in his assessments. Now that he is dealing with the period between 1951 and 1964, will not he agree on any assessment that our present ills are to a large part attributable to the failure to invest during that period?
Sir R. Gower: That may be partly the case, but I think that it is probably a criticism of our whole system that there has been some failure over a long period. The situation was undoubtedly aggravated after 1964, and I still maintain that one very great difference between this country and many of its most prominent rivals is that in those countries there has been no fear of the appropriation of businesses and industries. There has not been the same fear in Holland and Belgium. In most of our rival countries, the Social Democrats have abandoned the practice of taking industries into State ownership. As a result, they have been able to build for the future with far greater confidence than anyone in this country.
The right hon. Member for Anglesey (Mr. Hughes) is also very fair. He must realise that some of our successful companies have faced a terrible predicament in recent years. In some cases, if they were too successful, they faced the possibility of nationalisation. There was
74
even an incentive to remain below a certain size in some of the nationalisation schemes. That is the appalling position that we have arrived at in this country in recent years.
Mr. Donald Anderson: Surely a reading of history shows that the Government have quite wrongly nationalised the failing industry, whether it be shipbuilding or whatever.
Sir R. Gower: I am pointing out merely that certain companies have been nationalised if they have been above a certain size, so that businesses had an incentive not to grow beyond a certain size. That is the ridiculous nature of the problem which has arisen in some instances, though I admit not in all.
I hope that the confidence of the Secretary of State is well placed. However, I do not think that he can complain if we express anxiety about the situation as we see it today.
I make a special plea to the right hon. and learned Gentleman on behalf of some of our smaller businesses, and I do so not on any political or partisan grounds. I agree with my hon. Friend the Member for Pembroke that these are the acorns from which bigger enterprises grow. I hope that the right hon. and learned Gentleman will realise the difficulties which many of them have been facing for a considerable time. I do not want to overstress the difficulties, but one of them is the phasing out of the regional employment premium. The complaint of most of those who have spoken to me is not that it is being phased out but that it is being done at such intolerably short notice, and so quickly.
Cannot the Government reconsider their decision at least to this partial extent? If they could only make some concession on the speed of the phasing out of REP, they would meet many of the criticisms. Most industrialists and others with whom I have discussed this problem acknowledge the difficulties of the Government. They quite see that there may be a case for ending this kind of assistance over a period. But they feel that the Government should have taken greater account of the fact that companies, like other bodies, have to plan ahead. They had no reason to plan on the assumption that this would come

75
to an end so suddenly. It is the suddenness of the decision and announcement and the speed at which it is to be ended which have caused the criticism. If there could be some reconsideration of this, it would go a long way to assist them.
It may be that my hon. Friend the Member for Pembroke overstated the position in his reference to Bullock. I have met associations of industries and of bodies connected with industry in recent weeks, and they have expressed their great concern about the possibility of legislation which is not similar to that on the Continent and which is not comparable with what has happened in West Germany. On the whole they deplore the findings and recommendations of the majority report of the Bullock Committee. None of the members of the Committee had any experience of productive industry. The Committee was a collection of one or two distinguished trade unionists and some academics. Not one person who signed the majority report had any experience of the management of industry.
As I promised to abbreviate my remarks I shall make brief reference only to a constituency problem. I shall reserve references to transport matters but I feel that I must refer to the extension of the M4 motorway. On the whole we applaud the Government's decision to proceed as quickly as possible. I recognise that in many ways the plan is going ahead in a very encouraging manner.
Certain undertakings were given at the inquiry and subsequently that as far as possible care would be taken in the building of the motorway to avoid destroying the amenities of residential areas with the feeder traffic of large vehicles. However, as the Secretary of State knows, there have been anxieties and complaints from areas in my constituency. For instance, anxieties and complaints have been expressed in Lis-vane which is part of Cardiff and near the motorway. Similar anxieties and complaints have been expressed in the neighbourhood of Radyr, which is on the edge of Cardiff.
I hope that the right hon. Gentleman and his Department will do all that is possible to avoid the real problems created by large, heavy and disagreeable
76
traffic being concentrated through the attractive residential areas to which I have referred. There are other areas that come within other constituencies on which I shall not comment. I know that the right hon. and learned Gentleman is well seized of the problem and I hope that he will consider it again.
I hope that the confidence for the future of the right hon. and learned Gentleman is well founded. Our anxieties are not made purely from a partisan or political point of view. We are anxious—rightly, I think—about the condition of the economy of Wales. We recognise the international and national setting in which it is cast. We do not ignore that but we feel that everything must be done, and considerably more than has been done, to give confidence to industry. Industry has a formidable task. Like the right hon. and learned Gentleman, I applaud those who are doing so much to expand and maintain their business under difficult conditions. I trust that the Government will give them every encouragement.
5.33 p.m.
Mr. Neil Kinnock: I follow the hon. Member for Barry (Sir R. Gower) in that he said that it may be the system that is the real trouble. I also follow him in saying that there is a necessity, given the sort of system that we have, to try to sponsor confidence in the business community. However, experience in that respect has been sad for Conservative Governments as well as Labour Governments, as the former Conservative Prime Minister, the right hon. Member for Sidcup (Mr. Heath), had occasion to say in an irritated fashion in 1972. The right hon. Gentleman said that the Conservative Government had done everything possible by releasing tax obligations, giving Keynesian assistance and encouraging and giving a fair wind to a competitive mixed economy, and that still industrial investment and production had not noticeably picked up. The Prime Minister of that time threw wide his arms and asked the business community what more could be done.
It is true to say that the system is the villain of this piece. It is a man-made system and, therefore, it must be within the capacity of man to correct it. We have to have the courage to identify the

77
causes of our weakness and then to do a great deal to eradicate them.
Whether we are talking about the 81,000 unemployed in Wales, the low industrial production of Wales, the low industrial investment rate of Wales, or whether we are talking about similar difficulties throughout the whole of the United Kingdom and its 1½ million unemployed, among the primary causes of our difficulties is the fact that we have been encumbered, slowed down and distracted for years past—indeed, through every year since the war—by totally outdated and grandiose delusions and outdated responsibilities in both the military sector and the economic sector.
Continually foisted upon us has been the necessity of maintaining business confidence and international confidence not for reasons leading to the development of our economy, the development of industrial investment, the sponsorship of industrial employment and the improvement of living standards, but for the retention of capital in Britain. Although it has diminished, especially since my right hon. Friend's statement on 16th December 1976, our continuing rôle as an important world banker is a ridiculous, preposterous responsibility for a medium-sized economic and political power in the latter part of the twentieth century.
It is time that there was a consensus about the need to throw off such responsibilities, an acknowledgement that we shall never have a high-growth full-employment economy with a high standard of living as long as we try to retain these antediluvian, grandiose schemes for our rôle in the world economy and the world military structure.
When we turn our attention back to Wales to see the effect of bringing our economy to a juddering halt at various times since the war with the aim of trying to retain currency in Britain, and at other times with the aim of trying to attract currency. That was done in the knowledge that it was not here for hard industrial investment, merely to take advantage of the interest rates that the protection of sterling made us offer in order to try to sustain our rôle in the world. The effect has been not so much on London and the South-East as on the peripheral areas, on the regions, on the assisted areas such as Wales. Those are the areas where the instability that has been felt
78
within the system because of the country's world financial rôle has multiplied itself. It has had the stronger reverberations on the more sensitive and less secure parts of our economy, such as Wales.
The hon. Member for Barry asked why that has not happened in Holland, France and Germany. I have no interest in taking refuge from reality but the fact is that none of those countries has had the international obligations that this country has chosen to accept and continue over the years. We have had continual fluctuation where they have had relative serenity. Where we have a continuing obligation to maintain a world financial rôle, they have been able to concentrate on the advancing prosperity of their own economies by more intelligent and generous investment strategies and by the sponsorship of employment and all the things that have gone with it.
If the Government are to show us the way out of the acute difficulty in which we now find ourselves, it must be through the recognition that our international financial rôle must go. We must appeal to the international economies to acknowledge that we are worth far more to them alive than dead. We should be able to rely on their assistance, generosity, funding and the immense fortunes that they still have at their disposal to see us out of those responsibilities.
Sir A. Meyer: No.
Mr. Kinnock: I know that the hon. Member for Flint, West (Sir A Meyer) does not believe anything of that sort. All I am saying is that we should withdraw from his pipe-dream of the Britain that he once knew. Surely that is in the interests of the 81,000 people in Wales who are unemployed, the thousands more who are not secure in their occupations and the thousands more who will be afflicted by the cuts that the Government have had to implement to try to safeguard the position of sterling.
Let us put the issue fairly and squarely to the people. Our refuge does not lie in the sponsorship of profit. If it did, we would have saved ourselves a great deal of trouble in past years when Conservative Governments tried to intervene with profit-oriented policies. But in the nature of our mature economy and our international responsibilities, and in view of the attractions to investment elsewhere in

79
the EEC—and before it existed in the world market—even a Conservative Government could not breathe life into an ageing, senile capitalist system in Britain. Therefore, the refuge does not lie there—nor does it lie in the cuts that are now being experienced in the Welsh economy.
Wales is a country which, through no fault of its own—and because of no lack of inventiveness, no fear of hard work, or no lack of enterprise—simply has no indigenous large source of capital and is on the periphery of a great Western European market. Once its major resources lost the importance they once had in the world economy, there was no reason for Wales to be developed economically other than for the purpose of keeping the people there and of sustaining the community.
Profit cannot be very interested in Wales—and I do not blame it because that is in the nature of the system. As a consequence, Wales is afloat on public expenditure. The major source of development in Wales is to be found from public funds. Indeed, that is the major system of priming the pump. The only way in which Wales has a future is from public funds, simply because it can play no part at all in the general system which exercises the criterion of profit—[Interruption.] It is no use the Tory Whips grinning. Their knowledge of the system is the knowledge of ignoramuses. For many years Wales must depend on the willingness of the general public and the ability of the British Government to inject, sponsor and develop on the basis of public financing.
Mr. Wyn Roberts: Will the hon. Gentleman explain from where those public funds and injections are to come?
Mr. Kinnock: They come from all the people who subscribe taxation—corporate, private, purchase and many other forms of taxation—to a central Exchequer.
Sir A. Meyer: What about the National Enterprise Board?
Mr. Kinnock: The hon. Member for Flint, West is beginning to crow about the contribution to the nationalised industries. My right hon. Friend the Secretary of State has just demonstrated
80
that the only source of major large-scale industrial investment in Wales for many years has been the public industries. That has happened because the public industries, in addition to having an interest in profitability, obviously have an obligation to sustain a community standard and to have regard to a wider measure of public need than the mere creation of profit.
I remember the hon. Member for Flint, West in 1970 saying that what we needed was more Sloughs. Obviously the hon. Gentleman has not moved from that opinion. I wonder how loudly he says that to his electorate and what their response will be to that singularly depressing message that the battle is over in Wales, and that Wales can be starved of public assistance, public sponsorship, public funding and public investment—in other words, let Wales dry up and blow away. That is the attitude taken by anybody who wishes to adopt the criterion of profit in the development of the Welsh economy.
The Government's attitude to Britain's rôle in the world economy has made it necessary to bring about cuts in public expenditure to strengthen sterling. This has happened to such an extent that my right hon. Friend the Chancellor of the Exchequer in July 1976 proposed a cutback on regional employment premium to save £48 million, but by December last year it became necessary to abolish the premium to save £150 million in the current financial year and £170 million in the following year.
Nobody should make any mistake about the reason for destroying the REP. It was not the reason offered by my hon. Friend the Member for Swansea, West (Mr. Williams), who is a Minister and whose judgment I generally accept. The reason he gave on 31st January was that temporary employment subsidy
"gives a far more realistic form of assistance to firms that are really under pressure".—[Official Report, 31st January 1977; Vol. 925, c. 10.]
That is not the point, nor is it the fact that we have, as the Prime Minister said, a new problem of unemployment. The reason that REP is being abolished lies in the public expenditure cuts. It has arisen because of the need, in the Government's view, to strengthen sterling. It is a little inconsistent for those whose

81
major commitment in the business community is for that kind of strategy to win for Britain joy through pain, so that we can tighten our belts, put our shoulders to the wheel, put our noises to the grindstone, and all the rest of it, then to come to Parliament and say that if the cuts have resulted in the loss of the REP, that was not what was in their mind originally.
Certain realities must be acknowledged by the Opposition. The first reality is that the cuts have come about as a consequence of the economic orthodoxies preferred by the Opposition, with the result that Wales will suffer and will not be sheltered. I think that Wales should be sheltered. We have already lost £32 million. We cannot afford to lose another £20 million a year, which is the difference between the temporary employment subsidy and the total amount of REP that would have been paid. I do not think we can afford to lose even one farthing a year.
We should try to sustain the steady flow of REP, diminished in importance as it has been, as a means of sustaining industry, especially small firms, in Wales. In addition, we must have regard to the advantage given to the rest of the United Kingdom economy in the form of special assistance for the maintenance of manpower levels by the payment of temporary employment subsidy. There is no reason why we should not pursue both courses. That factor and the drain on public expenditure are not satisfactory.
Against that situation, the people of Wales stand to lose up to 10,000 jobs as a consequence of the revenue lost as a result of the abolition of REP. That is a major responsibility for the Government to take on. Indeed, if there had been an opportunity to vote against that change in policy in the Division Lobbies, I would have been willing to take that responsibility. We exchanged the constant injection of ready liquid sources of cash for industry in Wales for squirts of assistance which will disappear in the fortunate event of an upturn in the economy. Thousands of jobs in Wales are under threat.
There are particular problems and difficulties. I urge Ministers to look again at the necessity for a truly discriminatory form of industrial assistance —as the regional employment premium was. I urge Ministers to regard that as
82
an essential, main part of policy, as a decisive factor in our attitude towards regional policy, and to realise that—whatever the general difficulty throughout the whole economy—these problems are more intractable, deeper-rooted and longer lasting in Wales and other such regions than they are in South-East England and the non-assisted areas. Therefore, even at a time of crisis and difficulty, additional margins of discriminatory allowances, assistance, subsidies and inducements must be sustained.
Obviously, I should like the Government to go further than that, and, in the name of public accountability, to implement Labour's manifesto undertaking. The Government should not allow this money to be just drawn out. The use of the money should be made subject to a much wider public scrutiny. The Government should energise and give much more power to the NEB and the Welsh Development Agency, and relieve them of the restrictive guidelines that mean that, frequently, they can give money only to firms that do not really need it. The Government should make these organisations real entrepreneurs on their own behalf and the public's behalf in the use of public money.
I hope that we shall see the reestablishment of the proudest part of our Labour policies that have been put to the people of Wales during the past years—on the lines of the policies of 1966 and the regional employment premium of 1968. We were then showing a real commitment to giving discriminatory assistance to Wales, to Welsh employment and the development of the Welsh economy. If we fail, the people of Wales will make a judgment that we shall deserve.
Several Hon. Members rose—
Mr. Deputy Speaker (Sir Myer Galpern): I remind hon. Members that the debate must finish at 7 o'clock and that the wind-up speeches are due to begin at 6.30 p.m. Several hon. Members, who have been here throughout the whole debate, are still anxious to take part and six-minute speeches would ensure that they will all have an opportunity to speak.
5.52 p.m.
Mr. Geraint Howells: I have listened with interest to the debate so far and, with respect, I have heard

83
little from the Government today that will boost confidence in an ailing Welsh economy, especially in the private sector. No mention has been made today of the construction industry, of the self-employed sector, of housing, or of the elderly who have, in their time, given a great deal to Wales.
Three long years have passed since the Secretary of State for Wales was appointed to his present post. Those three years have been an unprecedented loss of confidence in all sectors of the Welsh economy. It is not my intention to blame all this on the Welsh Office and the present Government, as I am fully aware that there are some external influences involved and that many other areas of Britain have been similarly affected.
But I am not convinced that enough positive action has been taken by the Government to remedy the situation. For example, while I applaud the decision to set up the Development Board for Rural Wales, I regard the money given to finance the Board as far too little when the tremendous ask that it has been allocated is taken into account. I have said on many occasions that if we are to stem depopulation in rural Wales—and especially in Mid-Wales—more money must be allocated to the Board within the next three years. The Board's chairman told us some time ago that he would have only a few thousand pounds in hand after engaging in improving the development at Newtown itself.
I have taken heed of what the Minister said, but agriculture is also suffering from under-investment. Production has gone down, despite the Government's famous paper "Food from our own Resources" and, unfortunately, consumption has also gone down. Industries allied to agriculture are suffering as a result of this recession. There has recently been a severe shortage of tractors, especially the smaller ones that are used on hill farms.
I was disappointed to note that the Government have not yet come out in favour of the British Agriculture Export Council—a body that has, on many occasions, given great service to British agriculture and has encouraged the expansion of British markets abroad. I should like to see a definite commitment made to this organisation to enable it
84
to continue its work. Perhaps the Secretary of State would give—or at least consider giving—a separate grant to the Welsh Agriculture Export Council to assist the Welsh farmer to find overseas markets and thus encourage his productivity.
I wonder when the Minister will be having discussions with his counterparts in Europe and whether he will, in discussing the sheepmeat regulations, make sure that we retain the guarantee price system that now operates in this country. Will the Minister also give more consideration to something that is essential to the agricultural industry—the setting up of a land bank to help young people in agriculture in Wales. Their counter-parts in Europe receive bank loans at low interest rates of 4 per cent. to 6 per cent. compared with the higher rates that the young entrants to agriculture pay in this country.
I should also like to see tax reliefs. I wonder whether the Minister has given any thought to a tax relief over a period of three to five years—as in Australia to British agriculture. We are all willing to pay taxes because we are living in a welfare State. We are proud of what is given to every one of us in Wales today. But if we are to produce more from the land of this country—and that is essential—tax relief should be given to a farmer for three to five years so that he can invest in the land and produce more.
The burning issue in Wales at the moment is unemployment because there are over 80,000 unemployed. But there is also a housing shortage, and I have said on many occasions that the right priority for a young couple getting married is to look for a house and for work. We should do everything in our power to cater for the young and to make sure that they are employed and housed. Lack of housing and employment are two of the greatest problems facing the country today. I know so many unemployed in my own constituency who would gladly undertake any work rather than live on the dole.
The construction industry is in great difficulties, as we hear from reports this morning. Is there not some justification for channelling some of the money available in the job-creating programme into this sector, thus creating new jobs and

85
houses at the same time? Can the Minister say why the housing problem should not be partly solved in this way? The Government should be able to solve our housing probems in Wales within three years if they give the right incentives to private enterprise and if they give an extra cash flow to local housing authorities to build at a much faster rate than at present.
I have pointed out before how much small businesses and the self-employed can contribute to the economy. Given the right encouragement—in other words, getting rid of some of the discriminatory taxes that are imposed on the selfemployed—these small businesses could expand and so employ more people. This would make a great difference to employment prospects in the area.
I understand that the West Wales Steel Development Committee has made representations to the British Steel Corporation and the Government to ask for a quick decision on expansion plans for the Port Talbot steelworks. Can the Minister tell us when that decision, which will have far-reaching consequences, will be taken?
As I have said before, once we have our own Parliament in Wales to look after the economic and other interests of Wales, we shall be on the right road to recovery.
6.0 p.m.
Mr. Jeffrey Thomas: I am conscious of the pressures of time and will try to be brief. I hope that the hon. Member for Cardigan (Mr. Howells) will forgive me if I do not follow the themes of his speech.
I wish to deal first with industrial development certificates. The restriction of IDCs is vital to the future of the economy in Wales and I cannot help feeling that there has been an erosion in the Government's commitment to IDC policy. Unhappily, successive Governments have been guarded in making known the guidelines on which the policy of the day operates. I say to the Government that they cannot do by stealth what they cannot or will not do by edict.
A recent study of regional policy showed that IDC policy was responsible for an average of 45 firms annually moving to development areas between
86
1960 and 1971. The granting of IDCs is at the discretion of the Department of Industry and there is growing disquiet in development areas for in 1975 more than 400 IDCs, involving 1,300,000 sq ft of space, were granted in the South-East. It is profoundly disturbing that it has become much easier to obtain IDCs in recent years. This is a trend that must be halted.
It is essential to forge a cogent policy on the restriction and distribution of IDCs. Some years ago, the Hunt Committee reported that a comprehensive Department of Trade inquiry showed that at least one firm in five that moved to development areas did so, to a great extent, because it had been refused an IDC elsewhere. With the background of difficulties that we are encountering in Wales, it is clear that there must be a stringent curtailment of certificates in the richer areas of Great Britain.
Will the Government agree that unemployment figures should be the major factor to be taken into account in the consideration of IDC applications? Will they define the general criteria which determine the Department of Trade's attitude to a particular area of the country in relation to IDCs?
I hope that we can at least have some reassurance from the Government and a clear statement of policy on a matter which is of paramount importance in attracting industry to Wales.
On steel, I thank the Secretary of State and the Welsh Office for the truly magnificent efforts that they are making in Ebbw Vale and North Gwent. However, in September, 700 men are to be made redundant and this pattern will be repeated early next year.
I welcome the fact that Sir Charles Villiers, the Chairman of the British Steel Corporation, is taking over as Chairman of BSC Industry Ltd., for which Ebbw Vale is a test case. BSC Industry is not just an experiment in social responsibility that deserves to pay off. We in North Gwent look to the BSC, acting with the Government, the Welsh Development Agency and the local authority to ensure that alternative jobs are created to coincide with the job loss of 2,000 scheduled over the next 18 months.

87
It is crucial that the Government and the BSC should look again at the timetable of the rundown at Ebbw Vale in relation to redundancies. The alternative is unemployment on a scale that could not be tolerated.
I was pleased that the Secretary of State referred to the coal industry in his speech. As the Chairman of the NCB pointed out in December, the energy crisis has resulted in, if nothing else, a clear demonstration of coal's vast reserve potential and its capacity to provide a competitive and secure source of energy. International energy experts are now generally agreed that the world demand for coal may easily double between now and the end of the century.
Looking beyond the 1980s, when North Sea oil and gas are likely to be in decline, there will be an increasingly important rôle for coal. Recoverable reserves are now thought to amount to 45 billion tons, equivalent to 300 years' supply at the present output of 125 million tons a year. The Secretary of State mentioned "Plan for Coal" which is the industry's scheme for development up to 1985. That is well on target and the NCB and the unions have now turned their attention to longer-term strategies by agreeing Plan 2000, a blueprint for expansion to the end of the century. I was delighted that the Secretary of State made some encouraging noises about the Government's attitude to the Board's plan for coal. It is obvious that it will not fall victim of public expenditure cuts.
Last year, the Board embarked on the biggest coal exploration programme carried out in Britain since the nineteenth century. Spending has risen to 14 times the level of a few years ago on a programme of exploration and seismic surveys. Wales is well poised to take advantage of this new climate. Workable reserves in the South Wales coalfields total at least 2,000 million tons and, in addition, there is an estimated 3,000 million tons of workable coal in unproved or partly proved areas of the coalfield. At the present rate of output, that is enough for 100 years' consumption initially and possibly 150 years thereafter. In Wales, we have every cause to be optimistic for the future.
88
We believe that these opportunities for coal in Wales are exciting and far-reaching, certainly in my constituency where two collieries have outstripped their production records of the past 12 months. We believe that both sides of the industry will want to seize these opportunities. No worker in Britain has given more to the country than the Welsh miner and there is no doubt that the Government are resolved to give the coal industry all the support that it needs.
6.9 p.m.
Mr. Dafydd Wigley: I shall not follow the hon. and learned Member for Abertillery (Mr. Thomas) except to say that he referred to "encouraging noises" from the Secretary of State, but unfortunately we have heard the same encouraging noises for three years but no action. We need some encouraging policies and results from such noises.
We face a tragic economic situation in Wales and this short debate should concentrate on the Government's strategy in developing the economy of Wales. I listened to the Secretary of State with interest when he argued that 22,000 jobs would be coming to Wales as a result of the temporary employment subsidy, the job creation scheme and the work experience scheme, but these projects are not the answer to our problems. They are palliatives and, although they may be welcome in themselves, they are transitory and do not even replace the value of regional employment premium that we have lost.
The Secretary of State also mentioned Section 7 assistance and the benefits coming therefrom. But Section 7 assistance is no substitute for the regional employment premium. Both were in existence before. We would have expected an on-going programme under Section 7 in any case.
But under Section 8 of the Industry Act 1972 we find a far from satisfactory situation. Of 507 applications under Section 8 in Great Britain, only 12 were in Wales, and of the £48 million offered in assistance, only £300,000 was in Wales. The accelerated projects scheme situation is also dismal. In Great Britain, there have been 119 such schemes, worth £84

89
million, but only two of them have been in Wales, worth £2½ million.
The situation is not good enough. The palliative schemes are merely transitory. Most of them were announced before the regional employment premium cut in order to help with the existing unemployment situation, and if we are to make inroads into the economic problems facing Wales the case for the regional employment premium differential in attracting industry into Wales is overwhelming. The loss of REP has been a loss for the manufacturing industry sector. Schemes such as the temporary employment subsidy are not confined to the manufacturing sector and some are not applicable to it in any way.
The Government say that an additional £200 million would have been needed to bring the regional employment premium back up to the 7 per cent. level. But industry in Wales cannot afford the loss of an equivalent sum—as much as £32 million in Wales in terms of REP. There was no reason to chop it out completely, and the cut will have a serious effect. It is regrettable that the Prime Minister should have said on 20th January that the premium was of little significance. It is of particular significance in an area where trading margins are tight, which is the situation in Wales, where we have so many branch factories, who are the first to feel any recession.
The CBI has completed a survey of the effects on firms in Wales of ending REP. Out of 208 respondents, no fewer than 68 expressed concern at the withdrawal of the REP, and 140 expressed serious concern. There will be cash-flow problems as a result of the withdrawal, according to 115 of the firms surveyed. Asked whether redundancies might be created by the loss, 51 firms said "Yes" while 15 more said that this would possibly happen. On the question whether expansion plans could be deferred, 82 firms said that there would be a deferral. That is the tragic effect on industry in Wales of the withdrawal of REP. Some of these companies will be seeking greater flexibility in the Price Code to allow them to recoup some of the margin they have lost. They must do so in order to keep viable.
It is regrettable that the decision was taken so quickly. How can companies
90
plan ahead in their investment programmes in such circumstances? How can we expect companies to take any notice of Government incentive programmes if, at the drop of a hat, those programmes can be scrubbed overnight? This situation brings a message home to us all. Two days before the Chancellor of the Exchequer's announcement of the withdrawal of REP, the Under-Secretary of State for Industry said:
"As I recall, the Conservative Government were going to abolish REP completely. We retained it and have made it fairer as between men and women. We have had no evidence that it has had any deleterious effect. Our evidence so far is that REP is still a welcome inducement to investment and the maintenance of employment in the assisted areas."—[Official Report, 13th December 1976; Vol. 921, c. 959.]
How can we expect companies considering investment to take Government policy seriously when that sort of thing is said in the House only two days before the Chancellor announces withdrawal of the assistance?
The regional employment premium was an incentive in attracting jobs, and a vital factor in retaining jobs. It was particularly relevant in Wales because it helped the labour-intensive industries. So much of the rest of the armoury of regional policy is geared to capital intensive industries. The REP was a balancing factor, as the Welsh Council pointed out to the Conservative Government when they were considering the future of REP in 1972.
The premium was imaginative in many ways in creating, in effect a regional devaluation within a unitary State. There were great benefits from this when different areas needed different regulators. It was, contrary to what the Government say, a selective weapon. It was geared to bringing labour intensive industries to areas where work needed to be created. The abandonment of REP appears to have been a sacrificial lamb to placate the money-lenders of the IMF when the pound was in trouble. Wales has been taken to the altar to allow investment to go ahead in inner city areas—a political decision.
It appears that, for the £32 million being lost in REP, Wales is getting only about one-tenth back in new additional assistance, and companies with acute cash-flow problems as a result of inflation

91
and high interest rates will face problems of redundancy as a result.
This is a question of co-ordinating planning inducements for industry in Wales. We vitally need a strategy for Wales. We need economic planning. As pointed out in the book Overseas Investment in Wales, by Professor Glyn Davies and Dr. Ian Thomas,
"Any plans for development—whether by the Welsh Development Agency, by the local authorities concerned to implement or to update their own structure plans, by the Rural Development Board, or by major private businesses themselves—require here and now a comprehensive economic plan for Wales as a whole, within which their own plans can properly be fitted. Demand for such a plan is growing within Wales to such an extent that it appears incredible that a positive and affirmative answer can be much longer denied."
In the context of the work of the Welsh Development Agency, it was the responsibility of the Agency to put forward a statement of policy and programmes to the Secretary of State. I understand that its statement has been before him since the beginning of January. Has he approved it, or has he made substantial amendments to it? Will there be a chance for hon. Members to debate the strategy?
We need a strategy of economic policy. But, as shown in cases like the REP, the Government have a vacuum in terms of economic development policy for Wales, and it is little wonder that we are in a mess.
6.18 p.m.
Mr. Donald Anderson: Fundamental to the employment problem of Great Britain as a whole is the fact that we need to create more jobs, in part because of demographic pressures, with more people coming on to the labour market at a time when, for various reasons, it is becoming more difficult to create jobs. This dilemma is becoming particularly acute in Wales because we are facing more competition from other areas, formerly areas which were favoured in employment terms—the South-East and London. Thus we have pressures, which my hon. and learned Friend the Member for Abertillery (Mr. Thomas) described, to reduce the effectiveness of the IDC policy, which could have a bad effect on us in Wales.
92
I want to speak of the construction industry in Wales. The National Federation of Building Trades Employers carried out a survey among its member companies, and it found that 70 per cent. of them had a drop in inquiries for new work in the autumn, that more than half of them are working at two-thirds capacity, and that over 75 per cent. of them expect this year to be worse than last. That is the picture for the United Kingdom as a whole. It is mirrored locally by the Swansea Association of Building Trades Employers and the relevant trade union, UCATT.
It is clear, in looking at the unemployment profile in Wales, that construction workers account for about 25 per cent. of the total jobless. That is in absolute terms, and, as a proportion, it has every chance of worsening as a result not only of the July cuts, but, in particular, of the December cuts. In my area, some members of the local building employers' association are talking of reducing their labour force this year by as much as 50 per cent. It is estimated that, in the current year, in Wales as a whole there may be as few as 10,000 housing starts. One of the effects of the reduction in orders is the increase in overall costs. I was told, for example, that the success rate of tenders in the recent past was possibly one in eight, whereas it is now one in 40. One can imagine the amount of work involved in the preparation of tenders, which adds considerably to the overheads of such companies.
It is offensive in social terms to see skilled men laid off when there is such a substantial need in Wales for tackling the problems of old and decaying housing. Surely it is not beyond the wit of Government to put together the two sides of the equation—the need for work and the desperate need for housing. What thought has been given to that by the Welsh Office? I know that one cannot divorce Wales from the national constraints on public expenditure but what thought has been given to the delays in planning proposals which are currently causing so much concern within the building industry? The divided responsibility between various authorities which now exists often leads to delay.
It has been reported today that at Wednesday's meeting of the National

93
Economic Development Council the Government gave a wholly negative response to the demands of the industry for separate assistance. We are told that a sympathetic line has been taken but that no action is planned and that the industry should sweat itself out of the crisis.
As a result of the blows which the construction industry has suffered over the past few years, and which it expects to suffer in the next few years particularly because of the September cuts, the decline in the industry has resulted in the working in it becoming dispirited. Those employed in that industry are now moving into more secure industries or are becoming unemployed. The decline has gone too far and demand may quickly exceed supply when and if the upturn comes. What work have the Government done to solve this problem?
Clearly one effect of a hoped for early decision on the massive investment in Port Talbot will be consequential and beneficial to the construction industry over a substantial part of South Wales. That is an additional reason for an early and favourable decision on the Port Talbot investment.
6.23 p.m.
Mr. Ian Grist: Today we have been discussing matters which concern the people of Wales instead of the wasted effort, time and energy which has taken up the time of the House for the last few weeks. We must recognise that Wales is part and parcel of the United Kingdom economy, as it is part of the European and world economy. Any increase in jobs, which is what we are primarily after, is dependent on the recovery of our national economy and a recovery in investment intentions. Those have been severely damaged by Government actions in the last three years. They are not helped by the Bullock Report, by the latest price control proposals, by the abrupt withdrawal of REP or by the bias against the self-employed.
In Wales we have two specific major industries which have already been mentioned in the debate—steel and coal. Apart from the individual closure problems that exist in the steel industry, I am concerned that the European steel industry and the Western steel industry as a whole has over expanded in the face of competition from the Third World and
94
other steel producing countries. I am worried that there will be further massive lay-offs which are not planned.
I am surprised that hon. Members have not yet mentioned the proposed early retirement scheme for miners. That will cut the numbers employed in the coal industry in South Wales by 5,000 in the next three years. Where will the new skilled manpower come from to make up that loss?
What help is the Government to give to increase incentives for people to go into the mining industry? What are they doing to support the productivity bonus scheme which the NCB has proposed at a time when increased productivity is needed? Unless coal remains competitive with oil we must expect further redundancies and that fuel prices will leap upwards. With oil coming on tap in considerable quantities it is essential that coal productivity should increase because the South Wales coal industry cannot sustain a price-cutting situation.
In Cardiff we have a particular plea to make to the Minister. There seems to be a misunderstanding that Cardiff is stronger economically than it is. The Government do not understand the problems of Cardiff. For instance, male unemployment in South Glamorgan is at 8·3 per cent. and is mid-way between that for Shotton and Ebbw Vale. In the southern part of the city unemployment is comparable with anywhere in Wales. In my own division we have an enormous advance factory at Pentwyn which was announced under the last Conservative Administration and which was finished nearly two years ago. We are still waiting for a tenant. The Minister must tell the House what has happened to this factory and when we may have an announcement about it.
We have a completely unbalanced economy in South Glamorgan with only 22 per cent. of the workforce employed in manufacturing industry compared with 35 per cent. nationally. Yet if there is a closure at the East Moors steel works that imbalance will grow. Although we have this unemployment and low manufacturing base there is a serious shortage—as GKN has found—of skilled craftsmen in the engineering and electrical trades. The construction industry will also find that there is a similar shortage

95
if there is a pick-up in construction demand. I accept that the Government cannot do everything—and heaven forbid that they should try—but they can help and they can hinder.
We ask that the Government look at their plans for the M4 motorway. There is a real danger that this will turn into a gigantic Cardiff by-pass. There is a danger that all it will achieve is to take transport past Cardiff. It is designed to do that but we must have more access roads so that some of the traffic can stop in the Cardiff area. This will be the only motorway in the country which passes a major city and which has only two access roads to serve it. The further the M4 proceeds the greater the emphasis which will swing to the A55. The danger is that this vital aspect of the M4 construction will be overlooked.
We need more industrial sites in South Glamorgan. I do not want to touch on the row about the inquiry over the Wentloog site. But what are the Government doing to further the application to the ECSC for assistance for the Tremorfa foreshore site which involves 250 acres being prepared by the British Steel Corporation and the Cardiff City Council?
If the Government are not in the end prepared to support industry, profits and enterprise—if they are not going to live up to the words that they have spoken from the Prime Minister downwards in the last few weeks and months—they should get out of office and make way for those who are. If they can live up to their words, we would accept that it is only by those virtues that the Welsh economy and, through it, the national economy can truly recover.
6.31 p.m.
Mr. Wyn Roberts: In this short debate the grim facts of life in Wales have spoken for themselves. We have become so used to hearing them now that we are in danger of becoming insensitive to the reality behind them. I find statistics a form of anaesthetic. They dull our finer feelings and it takes the desperate plight of an individual, described in a letter or outlined in a surgery, to prick our consciences and bring home to us the intense misery of the economic situation over which the Government preside.
96
The Secretary of State should have appeared before us in sackcloth and ashes, but he is not even here and has not been here for a considerable part of the debate.
Hon. Members: Disgraceful.
Mr. Deputy Speaker: Order. Perhaps the right hon. and learned Gentleman has gone away to get the sackcloth and ashes.
Mr. Roberts: The Secretary of State came here for a short time to talk to us about a turning point on the horizon. We have heard about turning points before. They have been turning points for the worst.
It is sometimes said that, because the levels of social security benefits are such as they are, unemployment is more tolerable and means less hardship than it used to mean. That is dangerous thinking. It leads to what we now see developing—namely, a kind of social ostracism of the unemployed in some parts of Wales. We hear people say of those without work, especially in rural area, that it is due not so much to the fact that they cannot get work as to the fact that they do not really want it. Too often that is said without any real justification.
One can imagine the damaging psychological effect of that kind of statement on the individual without work, especially the young who have left school eagerly looking forward to their first job and a new life, only to find that there is nothing for them. There may be some who are better off on the dole than at work. But that is a condemnation of the system, not the individual. The vast majority would prefer to be in work than out of work.
I shall dwell briefly on another personal aspect of current high unemployment in Wales, because I think that we all need an antidote to the impersonal statistical approach. I have here a letter from a young constituent—a girl of nineteen—who has been trying to get a job as a typist for the last two years and cannot get one, she writes,
"because I cannot speak Welsh. Many people like myself cannot get work because of not being able to speak Welsh."
I had to reply to her that I also knew a number of young Welsh-speaking girls who could not get jobs either.
I mention that case because it is indicative of the erratic reasoning which thrives

97
in a situation of high unemployment. Curiously, the real reason why the non-Welsh-speaking young lady and the Welsh-speaking young ladies to whom I referred could not get jobs was the same—the cutback in local government spending. The one clear lesson is that unemployment can divide society along unexpected and unwelcome lines and that the utmost care must be taken to allocate jobs fairly and to give the correct explanations if jobs are not available.
I come now to what the Government euphemistically call their strategy. Never was there such a blatant contrast between the grand scale of Government efforts at promoting the economy and the actual dimension of the problems facing us. Any sane man looking at this contrast would be bound to conclude that there was something radically wrong with a system which had maximum Government effort working in one direction and maximum drift in the opposite direction actually taking place.
The Government cannot argue that their efforts are to match the adverse economic situation as they found it, because they have been in office for three years, they have been taking measures for three years, and the economic situation has been deteriorating continuously for three years. The present situation is of their making. Even they must be realising now that their thinking is at fault and that their strategy lacks some fundamental ingredient necessary to success.
If the Government want me to go back to their inheritance and compare the levels of unemployment and inflation that they inherited in February 1974 with the levels that we have now, I shall do so. But the Under-Secretary of State is silent for once, so we may take it that the Government accept responsibility for what has happened during their term of office. That is a welcome advance. It is the first acknowledgement that we have had.
The situation is so serious that it would be unforgivable not to try to help this hopeless, hapless Government, and I shall do my best in that direction.
First, it seems to me that the Government's left hand does not know what the right hand is doing. Reference has been made to the quick ending, the guillotining, of the regional employment premium.
98
Time and again, we have been told that the premium means very little as an incentive to employers to employ. The Secretary of State said that again today. In all, as we have heard, it amounts to £32 million annually in Wales alone. That is now to be taken out of the Welsh economy. Of course, that cannot be considered in isolation. It must be considered in conjunction with the increase in the employers' national insurance contribution. That will take a further £60 million out of the Welsh economy. In the simplest possible terms, the Government have made it more costly to employ people in Wales.
The Secretary of State may talk about more money being made available to the Welsh Development Agency. But we are bound to ask: at whose expense? It is at the expense of the private sector, those who are already providing employment, and it makes it more difficult for them to maintain their current levels of employment and to expand.
What is the reasoning behind this absurd transfer of resources? Is it simply a political cosmetic—a device to enable the Government to appear to be doing something? It may be, as I said earlier, that the Government's left hand does not know what the right hand is doing.
The increase in employers' contributions is what we might call British national policy while the cancellation of REP and the increase in funds available to the Welsh Development Agency are part of regional policy. Yet all these policies were announced by the Chancellor. But it would not be the first time that he has taken with one hand and given some, but by no means all, back with the other.
The truth is that, as we all suspect and as the hon. Member for Bedwellty (Mr. Kinnock) pointed out, in the course of the transfer of these resources some money is lost to. Wales. We may well ask whether the increase in Welsh Development Agency funds is at the expense of existing Welsh industry and probably available only from the cancellation of the regional employment premium. We are entitled to know the arithmetic, and we have not had it so far in the debate.
We know from the Government's expenditure plans, in Command Paper

99
No. 6721 that in 1977–78 the United Kingdom regional support and regeneration budget is reduced from £743 million in the current year to £475 million next year. Every major item of expenditure in Wales which is under the Secretary of State's responsibility is considerably reduced, with the exception of trade, industry and employment. The Government are juggling with figures and are hoping that the cancellation of one item of assistance and the consequent unpopularity will be outweighed by a positive move in another more Socialist direction. What a cynical, irresponsible attitude this juggling reveals!
The juggling might be justifiable if the money were to be used to a greater effect to reduce unemployment, but that is open to question. Its first use will be to create a bureaucracy. We have a Government of political opportunists, desperately anxious for some whiff of political kudos as a result of their economic machinations, and yet they fail. They fail themselves and the country.
There was an interesting regional review, entirely devoted to Wales, in the Estates Times last week. It made better reading than the last Welsh Office quarterly Economic Bulletin. The Estates Times said:
"There is a potentially baffling array of agencies trying to attract jobs to Wales; both central and local government as well as promotions by manufacturers and traders. This causes wasteful duplication and sometimes unedifying competition between counties and, with severe restriction on local government spending, this duplication is even less acceptable."
What worries me is that one has a distinct feeling that there is some substance in that charge of "a baffing array of agencies". Do we take enough care of those manufacturers and business men who come to Wales and try to provide jobs? Is too much emphasis being laid on the more obvious attractions of development in Wales and the business of attracting industry to Wales at the cost of care at a later stage?
I say this because I have encountered a few too many dissatisfied manufacturers who do not regard themselves as being properly dealt with by Government agencies and local authorities when they have established themselves here. There is an enormous job to be done in Wales. The Development Corporation estimates
100
that we need 120,000 new jobs in the next 10 years—half of them to bring unemployment down to 2 per cent., another 30,000 to replace those lost in steel and coal and the remainder in manufacturing.
The problem, as the hon. and learned Member for Abertillery pointed out, is to create the new jobs in time. It is the problem on Deeside, in Cardiff and South-East Wales. We feel that the Government are losing this race against time. Can one wonder at that when the Government have been dabbling with the Scotland and Wales Bill instead of concentrating on the proper economic priorities? One suspects—and I have never been afraid of saying this—that their devolution policy was, they imagined, a political insurance against that failure to create the right climate for new jobs. If so, that policy is now bankrupt and the business of creating worthwhile jobs is reasserting itself as the prime necessity for the people of Wales.
The real requirement is for political courage, the courage to take the right commercial decisions, although they may be politically hurtful in the short term. The Government have never seemed to be able to grasp this point. Even in agriculture their decisions are short term and inevitably detrimental to farming and the country as a whole in the long term. Similarly, in steel they have been as dilatory as possible. Even the right hon. and learned Gentleman's constituency is threatened by lack of investment. He told us only half or less than half the true story.
There is also a lack of directness in the Government's policies. It is not enough to build advance factories. There must be tenants and they will come, whatever incentives are provided, only if the business they intend to engage in is worth while and if they have a chance of making a reasonable profit and of keeping a reasonable share of that profit. People will not invest and work for the Government to get the biggest share of the benefit.
In Wales we are looking for a change of heart and mind on the part of the Government. There are signs that such a change is taking place in the attitude of the Prime Minister. It is not surprising since the Conservative document

101
"The Right Approach" has clearly become his bedside reading.
How long must we wait for a similar conversion of the Secretary of State? Heaven only knows. I believe that he has gone too far along the interventionist road to convert or to turn back. I shall adapt his own verdict on the Conservative Government, delivered on 23rd October 1971, by saying to him with far greater justification that the people of Wales know that the Labour Government are synonymous with unemployment, and they will not forget it.
6.47 p.m.
The Under-Secretary of State for Wales (Mr. Alec Jones): I begin by expressing my regrets at the absence of the hon. Members for Cardiff, North-West (Mr. Roberts) and Carmarthen (Mr. Evans) although doubtless their absence makes my task of replying to the debate a little easier. The Secretary of State has had to go to another meeting. It was not possible to cancel it, despite our attempts, because of the short notice of the debate. I do not blame anyone, but it is a fact. Certainly hon. Members have not muted their criticism, but I would have had it no other way. If the hon. Member for Conway (Mr. Roberts) thought that I was silent for once, the silence was only a temporary lapse until I had the opportunity to speak.
It seems right and proper that we should use this opportunity and this Chamber to examine the problems confronting us in Wales. If we are to overcome our problems, which is the aim of all hon. Members, it is right that the problems, the Government's policies and the economic instruments that we have used should be subjected to the examination and criticisms of hon. Members this afternoon. I find it a little easier to accept the criticisms from some hon. Members than from others.
I have sat on this side of the House since 1974 and I have heard hon. Gentlemen opposite repeat ad nauseam that the cause of our ailments was the level of public expenditure. If only we had reduced this to the bone, all our problems would be solved, they have said. I noted the points made by the hon. Member for Pembroke (Mr. Edwards). He suggested a change in status for the North-East and the Milford Haven area. That would involve an increase in public expenditure.
102
He said that we should stop shilly-shallying over Port Talbot as that would increase public expenditure. I was not sure whether the hon. Member was for or against Shotton, but if he was for it, that would mean an increase in public expenditure.
On the problem of the coal burn at Carmarthen Bay, he suggested that there should be adjustments to the price structure. That would involve an increase in public expenditure. His attitude to REP involved an increase in public expenditure. Almost without exception he called for increased public expenditure when his party has consistently said that the levels of public expenditure have been one of the main causes of our problems. The hon. Member for Conway repeated that.
What the Opposition have said on the question of regional employment premium was quite staggering, for in 1970 one of the first actions that they took on coming to office was to end investment grants and, by so doing, reduce to one-third the number of industrial development certificates in Wales. They soon became aware of what they had done, for in the Industry Act 1972 they were forced to return to a system similar to REP.
My hon. Friend the Member for Bed-wellty (Mr. Kinnock) suggested that the withdrawal of regional employment premium would lead to a job loss of 10,000. In the Government's judgment, the job loss resulting from the withdrawal of REP, coupled with the other measures announced by the Chancellor of the Exchequer on the same day, would be more than offset by the additional employment resulting from the measures to reduce unemployment and the additional expenditure on incentives to promote investment. Therefore, the net effect of the Government's package will be to reduce unemployment during 1977.
If my hon. Friend proposes to continue to use the figure of 10,000, I should much appreciate it if he would spell it out in more detail, but not now. In the Government's view, his figure is hopelessly wrong and represents the reverse of what will happen. However, I accept that there may be a problem about the speedy withdrawal of regional employment premium, but the fact that it is paid quarterly will give companies a breathing

103
space of three months in which to review the situation. I say to firms in Wales that wish to revise their corporate plans that if any problems arise I trust that they will get in touch with my Department.
No one disputes the figures which the hon. Member for Pembroke gave, and no one takes any comfort from the level of unemployment, but he was less than honest when he suggested that only the Labour Government were at fault, because unemployment is excessively high throughout Europe. Countries on the Continent are dealing with the problem in different ways. The German and Swiss Governments are proposing to send back foreign nationals from their countries.
Because the unemployment situation is of concern for all EEC countries, it was announced in the middle of last month that the European Commission intended to draft a significant and comprehensive policy document during the following six months spelling out a strategy for tackling the unemployment problem throughout the Common Market. There is therefore evidence from Governments other than the British Government that unemployment is a problem in other countries and that the EEC is aware that it needs to be tackled.
The hon. Member for Caernarvon (Mr. Wigley) referred to the Welsh Development Agency and its strategy. He is aware, I think, that the Agency has not yet submitted to my right hon. Friend its strategy, which is the one referred to in the guidelines on industrial investment functions. However, it has sent to my right hon. Friend a copy of its draft statement of policies and programmes. My right hon. Friend is now considering it, but when and in what form the document will be published is a matter for the Agency.
The hon. Member for Barry (Sir R. Gower)—who has apologised for his absence, which I well understand—drew attention to the problem of small firms. It is fair to say that the Government have taken certain action to assist small firms—for example, tax concessions on stock appreciation and capital transfer. Secondly, to help small firms, a counselling service was set up as a pilot scheme in the South-West to make outside professional advice available to them, and, if
104
successful, it will be applied elsewhere in Britain. We are making a study of management training needs of small firms. Assistance is available to small firms to make joint services available, such as accounting and marketing. Therefore, the Government are fully aware of the importance of small firms and are taking steps to try to make it easier for them to fulfil their rôle.
The hon. Member for Pembroke talked about the Carmarthen Bay power station and expressed concern, which we have heard from many quarters and well understand, about the future of the power station. This concern has been presented to us in the form of a joint submission by the Dyfed County Council and other local interests. The CEGB has given us an assurance that the four generating sets remaining in operation at the station will be available until at least 1980–81, but their operation will depend on the requirements of the national merit order working.
That issue and the question of coal stocks and coal burn at the Aberthaw power station are under current discussion by the working party, which held its second meeting last week. At that meeting there was the local union representative from the Carmarthen Bay power station to make sure that the working party did not ignore the problems affecting the power station.
The hon. Member for Cardigan (Mr. Howells) and others raised the question of Port Talbot and Shotton. We understand that the British Steel Corporation is nearing the end of its examination and will very shortly be submitting its conclusions to the Secretary of State for Industry. I am sorry that I cannot define "very shortly", but I think that one should read it fairly literally.
The hon. Member for Pembroke suggested that there had been considerable shilly-shallying by the Government on the question of Shotton. Had the policies of the Conservative Government been implemented, there would not have been a Shotton to shilly-shally about and the hon. Gentleman might not have received the support which he has received from the hon. Member for Flint, West (Sir A. Meyer).
The hon. Member for Pembroke also raised the question of development area

105
status for the North-East. We are aware of this problem. It is being actively considered and discussed by the Department of Industry. The Secretary of State for Industry, myself and a number of other Ministers recently received from the North-East a deputation which drew attention to the problems.
The hon. Member for Cardigan probably did not hear my right hon. and learned Friend the Secretary of State say that he would be going to the Council of Ministers meeting in Brussels on 14th and 15th March to participate in the discussions.
Several hon. Members have mentioned the construction industry. The Government are currently considering suggestions which have been made to them by the economic development committees for building and civil engineering to ease the problems of the industry. Nevertheless, we should not ignore the practical steps which the Government have taken,
Question accordingly negatived.
including the spending of £50 million on the M4 this year, with a likely £48 million to be spent next year.
Despite all the criticisms about housing which have been made, we are spending more on housing than was spent by the Conservative Government and are building more houses in Wales. This is of help to the construction industry.
Most hon. Members have agreed that there can be a thriving Welsh economy only—
Mr. D. E. Thomas rose in his place and claimed to move, That the Question be now put.
Question, That the Question be now put, put and agreed to.
Question put accordingly, That this House do now adjourn:—
The House divided: Ayes 13, Noes 100.

Division No. 83.]

AYES

[6.59 p.m.

Grimond, Rt Hon J.

Rodgers, Sir John (Sevenoaks)

Wigley, Dafydd

Johnston, Russell (Inverness)

Ross, Stephen (Isle of Wight)

Marten, Neil

Stanbrook, Ivor

TELLERS FOR THE AYES:

Pardoe, John

Steel, Rt Hon David

Mr. D. E. Thomas and

Penhaligon, David

Thorpe, Rt Hon Jeremy (N Devon)

Mr. Geraint Howells.

Rees-Davies, W. R.

Wainwright, Richard (Colne V)

NOES

Anderson, Donald

Faulds, Andrew

Perry, Ernest

Armstrong, Ernest

Foot, Rt Hon Michael

Prescott, John

Barnett, Rt Hon Joel (Heywood)

Garrett, John (Norwich S)

Radice, Giles

Bates, Alf

George, Bruce

Rees, Rt Hon Merlyn (Leeds S)

Benn, Rt Hon Anthony Wedgwood

Gould, Bryan

Richardson, Miss Jo

Bidwell, Sydney

Grant, George (Morpeth)

Roderick, Caerwyn

Bishop, E. S.

Hamilton, W. W. (Central Fife)

Rowlands, Ted

Blenkinsop, Arthur

Harrison, Walter (Wakefield)

Selby, Harry

Booth, Rt Hon Albert

Heffer, Eric S.

Silkin, Rt Hon John (Deptford)

Brown, Ronald (Hackney S)

Horam, John

Silverman, Julius

Buchan, Norman

Hughes, Rt Hon C. (Anglesey)

Skinner, Dennis

Canavan, Dennis

Hughes, Robert (Aberdeen N)

Small, William

Carmichael, Neil

Hughes, Roy (Newport)

Smith, John (N Lanarkshire)

Cartwright, John

Hunter, Adam

Spearing, Nigel

Cocks, Rt Hon Michael

John, Brynmor

Stallard, A. W.

Cohen, Stanley

Johnson, James (Hull West)

Stewart, Rt Hon M. (Fulham)

Coleman, Donald

Jones, Alec (Rhondda)

Stoddart, David

Concannon, J. D.

Jones, Barry (East Flint)

Taylor, Mrs Ann (Bolton W)

Cowans, Harry

Jones, Dan (Burnley)

Thomas, Jeffrey (Abertillery)

Cox, Thomas (Tooting)

Kerr, Russell

Tinn, James

Cunningham, G. (Islington S)

Kinnock, Neil

Wainwright, Edwin (Dearne V)

Davies, Bryan (Enfield N)

Lamond, James

Walker, Harold (Doncaster)

Deakins, Eric

Lewis, Ron (Carlisle)

Watkins, David

de Freitas, Rt Hon Sir Geoffrey

Litterick, Tom

White, Frank R. (Bury)

Doig, Peter

McDonald, Dr Oonagh

Whitehead, Phillip

Dormand, J. D.

McGuire, Michael (Ince)

Whitlock, William

Dunnett, Jack

McNamara, Kevin

Williams, Rt Hon Alan (Swansea W)

Eadie, Alex

Marks, Kenneth

Williams, Rt Hon Shirley (Hertford)

Ellis, John (Brigg & Scun)

Meacher, Michael

Williams, Sir Thomas (Warrington)

Ellis, Tom (Wrexham)

Millan, Rt Hon Bruce

Wise, Mrs Audrey

English, Michael

Morris, Alfred (Wythenshawe)

Ennals, David

Morris, Rt Hon J. (Aberavon)

TELLERS FOR THE NOES:

Evans, Fred (Caerphilly)

Orme, Rt Hon Stanley

Mr. Peter Snape and

Evans, Ioan (Aberdare)

Parker, John

Mr. Ted Graham.

Ewing, Harry (Stirling)

Pavitt, Laurie

LONDON TRANSPORT BILL (By Order)
Order for Second Reading read.
Motion made, and Question proposed, That the Bill be now read a Second time.
7.10 p.m.
Mr. Ernest G. Perry: This Bill is sponsored by the London Transport Executive. It is a short Bill which clears up a few odds and ends about various works which the London Transport Executive wishes to carry out. We London Members have little opportunity of discussing the problems of London, and that of London Transport is one of the most severe problems that we face. The Bill seeks to some extent to ameliorate the problems of London Transport and of the travelling public. I hope that the House will give it a Second Reading.
It is similar to previous Private Bills promoted by the executive and its predecessors in each Session since 1st January 1963 when the London Transport Board was set up. Between 1948 and 1962 legislation for London Transport purposes was promoted by the British Transport Commission. This Bill has been modelled on the earlier Acts. For the sake of convenience a number of standard clauses have been incorporated in Clauses 9 and 10 by reference to the appropriate sections of the London Transport Acts 1963 and 1969.
The undertaking operated by the Executive comprises mainly the London Underground railway system with its associated electrical generating stations and sub-stations, and the extensive system of bus services operating mainly within Greater London. One of the purposes of the Bill is to authorise the carrying out of railway works which require the authority of Parliament. The most obvious example of this is work involving interference with the highway. If that work were done without statutory authority, it would by definition be a public nuisance. Since statutory authority is required for works, it is necessary to obtain from Parliament power to take over land acquired compulsorily. This has always been the practice.
Perhaps I may now summarise the powers provided by the Bill. Part I con-
108
tains the interpretation and the incorporation of general Acts. Part II deals with lands. It authorises compulsory acquisition by the Executive of certain lands and a right of way required for the purposes of the railway works mentioned in Clauses 5 and 7. Part III deals with the protective provisions, and Part IV with miscellaneous matters.
In Part II Clause 5 deals with the power to acquire land at Mile End. That is in the East End of London, and for all those hon. Members who do not reside in London I shall explain that it is one of the most heavily populated parts of the city. The land required for the purposes mentioned in Clauses 5 and 7 is shown on the plans which are required by Standing Orders to be deposited with Parliament at the time that the Bill is deposited. Of course, this has been done. The deposited plans show by parcel numbers, known as deposited plan numbers, the lands authorised to be acquired compulsorily.
There is a switch house in Mile End which is a major supply point in London Transport's 22,000-volt electrical distribution system, supplying a large section of the Underground railway on the north-east and east side of London, involving the Central and District lines. The present 22,000-volt switch gear was installed in 1941 and is now obsolete. Its replacement is part of a continuing programme for renewal of the electricity supply system equipment. To maintain a supply to the railway it is necessary to instal the new switch gear before undertaking a phased change-over of cables from the existing equipment. There is no available space in the existing building, so an extension measuring roughly 27 metres by 11 metres on the south side is proposed to house this new equipment. The remainder of the land sought to be acquired will be required as a working site to construct a new building.
Clause 6 is required in order to empower the Executive temporarily to dig up the pavement of Maplin Street which adjoins the land required for the Mile End works. The reason is that it is desired to build up to the boundary line between the street and the land which is to be acquired. That cannot be done without digging up the pavement. Clause 6(2) subjects the Executive to an obligation to restore the surface of the street

109
to as good a condition as the Executive found it in, or as nearly as may be.
Clause 7 contains the power to acquire land at Cannon Street. Cannon Street is one of the largest stations serving the population in the South-East of London. The land to be acquired compulsorily is a small piece required in connection with the second stage of the Fleet line between Charing Cross and Fenchurch Street.
I need not stress the importance of the continuation of the Fleet line in order to promote the continued development of dockland. This is one of the most essential parts of the work, and any failure to encourage London Transport to proceed with this sort of work would be a severe commercial blow to the whole of dockland. The scheme has been authorised by the London Transport Act 1971 and the compulsory purchase powers were extended by the 1976 Act. This piece of land adjoins land authorised to be acquired by the 1971 Act upon which an office building known as Bush Lane House has almost been completed.
The land on which the original building stood was intended to be acquired under the 1971 Act as a working site from which to construct the station and the ancillary tunnels for Cannon Street Fleet line station. The Executive came to an arrangement with the owners of the building to enable it to be built without preventing Fleet line being constructed beneath it at some time in the future, and the small additional area of land now the subject of this Bill was to be transferred by the developers of Bush Lane House to the Executive as part of the future working site.
This shows the co-operation which exists in London between the Executive and the other commercial interests which, like the Executive, are concerned that the prosperity and the further development of this part of London should go ahead. It is to their credit that they have given permission to the Executive to do this. In addition, the superstructure of a draught relief shaft, part of the ancillary station works, may impinge on this land when local authority planning requirements are known.
Clause 7(2) is intended to give the power to acquire compulsorily the necessary additional land. Clause 7(3) authorises the Executive to acquire a right
110
of way over a roadway called Scott's Yard which also adjoins Bush Lane House. That right is required for the construction of the Fleet line works and thereafter for the maintenance of the ventilation shaft.
Clause 8 deals with the period for compulsory purchase of land and right of way. It provides for the compulsory purchase powers sought by Clause 5 in respect of Mile End to cease on 31st December 1983, and for those sought by Clause 7 in respect of the Cannon Street land on 31st December 1982. The reason for this apparent inconsistency is that the latter is the date when the Executive's compulsory purchase powers for the second stage of the Fleet line will come to an end under the London Transport Act 1976. There would, of course, be no point in seeking a longer period for the small piece of land and right of way which are the subject matter of Clause 7, since, as already mentioned, they are required for that length of railway.
Clause 9 incorporates a number of common form ancillary powers relating to land taken from previous London Transport Acts.
Part III deals with protective provisions. Clause 10 incorporates provisions taken from previous London Transport Acts in favour of the public utility undertakers and the Metropolitan Police.
I come now to Part IV, which deals with miscellaneous provisions. Clause 11, regarding extensions of time, is made up of four subsections. Each of the first three extends the time for the exercise of the compulsory purchase powers of previous London Transport Acts, which time would otherwise expire at the end of 1977. Subsection (1) deals with a railway from Waterloo to Aldwych. Subsection (2) deals with the third stage of the Fleet line, between Fenchurch Street and New Cross. Subsection (3) deals with certain passenger subways at Holborn.
Clause 12 deals with powers to owners and lessees to give notice as to purchase of lands. It is most necessary to have this clause in order to have the proper provisions. The clause is the usual right given to owners and lessees of land in respect of which the compulsory purchase power is extended by Clause 11 to compel the London Transport Executive at any time after 31st December 1977 either to

111
acquire their interest in the land or to give up its power. This is, of course, a provision intended to prevent land values from being blighted for an indefinite period of time by the threat of compulsory purchase. I am glad to see this provision in the Bill, because one of our problems in London is that when land that may be acquired becomes blighted, the owners cannot sell it, or they get a value that is much lower than its true value.
Clause 13 deals with the question of fines for certain offences concerning the LTE. I am quite sure that all hon. Members and most people in London are concerned about the flagrant non-payment of fares on London Transport. Anything that the House can do to stop this sort of crime—not paying one's way—must be encouraged by means of legislation.
Clause 13, read with Schedule 1, provides for increases in the fines payable for the offences described in the second column of the schedule. One reason for proposing these increases is the need to restore the deterrent effect of the old maximum fines, which has been reduced by inflation. The old maxima were in some cases last increased as far back as 1965. One realises the progress of inflation—if one can use that phrase—since 1965. Fines valid in 1965 should be quadrupled, at least, in order to have the same effect today.
The main reason for seeking to increase the fines to the extent that they are increased by the schedule is, however, to bring them into line with the Criminal Law Bill now before Parliament. The maximum fines now sought to be imposed have been scrutinised by the Home Office, which has told the LTE that it considers them appropriate.
The proviso to Clause 13(2) proposes an increase in the maximum term of imprisonment for breaches of Section 17 of the Railway Regulation Act 1842, which relates to misconduct by persons employed on the railways. The previous maximum was two months, which it is proposed to increase to three. As a deterrent, I hope that it will be successful. This again has been approved by the Home Office and reflects the Criminal Law Bill, three months being the lowest
112
maximum term of imprisonment shown in Schedule 1.
Clause 14 deals with increases of fines for contravening byelaws. Subsection (1), read with Schedule 2, provides for the doubling of the maximum fines payable for breach of the LTE's railway byelaws. This, too, is based on the Criminal Law Bill and has been approved by the Home Office.
The opportunity is being taken by subsection (2) to get rid of the system whereby there is a tariff of maximum fines varying with the gravity of the offence. It is now thought better to have only a single fine and that the maximum one. That does not mean, of course, that the gravity of the offence is to be disregarded. It will be taken into account by the court when sentencing an offender in exercise of the usual judicial discretion.
Clause 15 deals with fines under these byelaws in the same way as Clause 14 does with railway byelaws.
Mr. John Page: Will the hon. Gentleman clarify the point that he has made on Clause 14 about the fines? Is £50 now the maximum for any byelaw contravention and is that the same maximum to be used throughout? Am I right about that? I was listening to the hon. Gentleman, but I did not quite pick up his point.
Mr. Perry: I thank the hon. Gentleman for his intervention. If he looks at the schedules, he will see that the fines rise considerably. Some of them rise from £20 to £200, some from £25 to £200 and some from £25 to £50, and there are varying figures such as those. The amount of the fine for each offence is set out in detail on pages 10 and 11 of the Bill. I hope that the hon. Gentleman will accept that answer for the present.
Clause 17 extends a power originally conferred upon the British Transport Police by Section 54(1) of the British Transport Commission Act 1949. The subsection authorises any constable to stop, search and arrest any person in the employment of the British Transport Commission or employed upon railway or other premises used for the handling or storage of goods who is reasonably suspected of being in possession of anything stolen or unlawfully obtained.

113
Section 54(1) as originally enacted continued in force for five years unless otherwise determined by Parliament. It was extended for successive periods of five years until 1975, when it was extended for only two and a half years, because public legislation on the topic was thought to be impending. In the last Session of Parliament, the British Railways Board, the British Transport Docks Board and the LTE, all of which are served by the British Transport Police force, each sought a five-year extension.
I am sure that all hon. Members would like to give full support to the British Transport Police in the carrying out of their duties. They have a very onerous task. However, only the British Transport Docks Board was successful. British Railways and the LTE, whose Bills had passed through all stages in the House of Commons, were unable to overcome the objection of the Lord Chairman in the unopposed Committee in the House of Lords, and they had their extensions cut down to two and a half years.
What is now sought by Clause 17 is to make up the five-year period proposed last year. The LTE has been encouraged to include Clause 16 in the Bill by British Railways, which are doing the same, and by the fact that the Home Office last Session raised no objection to the full five-year period.
As I have said, this is a Bill of a moderate nature. It is merely trying to iron out a few items that the LTE thinks need altering. I do not think that any hon. Member will disagree with the view that fines should be increased. One realises from living in London not only the problems of London Transport but the problems of the London travelling public and those who are prepared to pay their fares in full when they travel. Anyone who attempts flagrantly to break the regulations and not to pay his fare or the full fare has an effect on those who pay the full fare.
For only that clause in which we are perhaps, affecting the criminal law concerning increases in fines the Bill deserves a Second Reading. The other items in the Bill are minor items, merely giving permission to extend a switch station and to enter upon land in order to continue the Fleet line. No hon. Member—at least, no London hon.
114
Member—will object to the Bill. I have great pleasure in commending it to the House.
7.29 p.m.
Mr. John Hunt: I am sure that I speak for all hon. Members when I say how grateful we feel to the hon. Member for Battersea, South (Mr. Perry) for his detailed and helpful presentation of the Bill. He has taken us through the provisions almost line by line. We are grateful for that, and for the way in which he has expounded the case for the Bill.
The Bill's provisions are mainly noncontentious. None of us foresees any bitter opposition emerging to them. I therefore propose to look a little beyond the legal and technical details, to the operations of London Transport in the context of the Preamble to the Bill, which refers to the general duty on the London Transport Executive to perform its functions
"with due regard to efficiency, economy and safety of operation."
No one would challenge the record of London Transport in safety. In that respect, it has been wholly commendable, but I fear that in efficiency and economy its record leaves much to be desired.
Since we are now little more than two months away from the GLC election I suppose that it might be appropriate for us to recall that in its last election manifesto four years ago the Labour Party on the GLC gave a pledge
"to start at once talks with all interested parties about the implementation of our policy of a low flat fare scheme, leading to a free transport system, which is our long-term aim."
The clear implication of that passage was that, under Labour, fares not only would be kept low but would in time be eliminated altogether. It was, perhaps, one of the most cruelly irresponsible pledges ever given at an election. It was cynically designed to catch votes at a time when every responsible observer, in London and throughout the country, knew that that pledge could never be honoured. And so it has proved.
As every Londoner knows to his or her cost, fares, particularly in the last two years, have been rocketing, and by this summer will be no less than 146 per cent. up on the levels of 1975. So much for free transport. Indeed, to adapt a

115
famous phrase, I think that one can say that never in the field of public transport has so much been paid by so many for such an erratic and unreliable service.
The whole financing of London Transport now seems to be lurching out of control. In 1973, the last year of Conservative control, subsidies to London Transport totaled £10 million. Today, they have reached the staggering figure of £144 million. An operational profit of £10 million in 1973 has been transformed into an operational loss of £93 million for 1975. That illustrates the extent of the financial chaos which has been created, and it means, in effect, that every Londoner is paying for this service three times over—first, through the rates; through taxes, and third, through the higher fares.
Mr. Nigel Spearing: The hon. Gentleman talked about fares and reducing them. Would he not agree that, despite the figures which he has quoted, all old-age pensioners have free travel, and children under school age pay a maximum 5p fare on the buses? Therefore, would he not agree that some welcome progress has been made in the fares objectives which were spelled out?
Mr. Hunt: I would not quarrel greatly with that point, except to say that it is the sphere of the subsidy designed to help a specific category to which we in the Conservative Party have no objection. Our objection is to indiscriminate subsidy which goes to help all travellers alike, irrespective of need, and which in many cases helps those who are tourists from overseas and from other parts of the country, and who make no contribution in rates to the operations of London Transport. There is, therefore, a distinction between specific subsidy and indiscriminate subsidy of the kind which has been operated now by London Transport under the Labour Party.
As I say, this is a grotesque situation which understandably is leading to increasing anger and frustration among the commuting public and to the demoralizations of London Transport staff. The running of London Transport is a labour-intensive operation. Indeed, I think that the labour costs account for almost 80 per cent. of its total expenditure. That means that, at times of galloping inflation such
116
as we have at the moment, the only way of containing these escalating costs is by staff economies or more mechanisation. I suggest that the London Transport Executive is falling down on both those counts.
Staff, far from being reduced, have increased from 54,897 in 1973 to over 60,000 today, in spite of a natural wastage of about 5,000 employees a year. If those posts had been left unfilled, that in itself would have produced a saving of about £25 million a year.
Only last Friday there was a letter in a London evening newspaper from a Mr. Derek Thornton of Ilford, saying:
"In more than 20 years of travelling, I have never before observed so many apparently idle and unnecessary station staff grouped about platforms or ticket points, usually chattering cheerfully among themselves. How can the LTE justify this wasteful misuse of labour in what are clearly non-jobs at a time of ever-increasing fares and ever-diminishing standards of service? As an expert in work studies. I estimate that the Underground stations could operate satisfactorily with about half their present labour force."
That impression is certainly widely shared.
I have never been able to understand, for example, why it is that ticket barriers on the Underground have to be manned at both entrances and exists. I should have thought that a strict check at the exit point would have been quite sufficient and would result in substantial saving of labour costs.
As the hon. Member for Battersea, South rightly said, much more must be done to check evasion. I am sure that we all welcome the provisions in the Bill dealing with that specific point. It is estimated that fare dodgers are now costing London Transport at least £10 million a year, and I have seen some much higher estimates. There is no doubt that cheating on that scale is a major scandal and, as the hon. Gentleman said, is much resented by the majority of honest and law-abiding travellers.
If there is evasion on this scale, as I think there is, that certainly strengthens the hands of those who have been urging the introduction of on-the-spot fines for this offence. [Interruption.] I know that that proposal has had a somewhat chequered history and has not in the past met with universal approval in this House, but if the proposal were to come back in

117
the light of these alarming evasion figures it might have a rather more friendly reception.
The schedules increase the fines for various offences. I am delighted to see that the penalty for failing to produce a ticket or to pay the fare is to go up substantially from £20 to £50 and that the penalty for some acts of vandalism, such as throwing stones at trains, is to be increased from £25 to £200. Those are much more appropriate fines in present conditions. One must express the hope that, on conviction, magistrates will make full use of these higher penalties. We therefore look to the magistrates to support the sentiments expressed in this House about fare evasion and vandalism.
Some time ago we all received copies of London Transport's somewhat hostile reaction to the Government's consultation paper on transport policy. Hon. Members will have seen that the London Transport Executive in particular rejected the implied criticism that indiscriminate subsidies of the kind enjoyed by London Transport lead to management inefficiency.
Having considered the matter, I have come down on the side of the consultation document, because I believe that in the absence of any real obligation to pay its way London Transport has, for example, been regrettably slow to appreciate and exploit the development potential of many of its sites, not only with regard to office development but also the provision of housing accommodation for its employees so that they can be on the spot for their jobs.
We recently read of a multi-million-pound office development on a London Transport site in Hammersmith which, when completed, will be the largest complex of its kind in the country. It is estimated that the rental income from this will pay for the much-needed improvements to the public transport services within Hammersmith. Personally, I warmly applaud this kind of scheme. It is long overdue. If it can now be done in Hammersmith, one is bound to ask why similar plans have not emerged for the scores of other London Transport sites which must be ripe for similar development and which have been left undeveloped and unexploited for a prolonged period.
118
I welcome the reported intention of the Conservative Party on the GLC to undertake a fundamental review of the present bus routes, a great many of which have remained unchanged since the days of the horse-drawn vehicle.
Mr. Spearing: Like the roads.
Mr. Hunt: The suggestion for the introduction of shorter routes—a series of feeder routes leading to interchange centres—makes a great deal of sense and would meet the situation which exists in a great many of our constituencies where council estates and other housing developments have often been built away from the main bus routes and where the residents, particularly the elderly and infirm, feel stranded and isolated. My own constituency of Ravensbourne, together with others in the South-East of London, is particularly dependent on the buses in the absence of any Underground services.
We have recently been very concerned about the number of breakdowns within the London Transport bus fleet. At one time, I believe, no less than 900 London Transport buses were off the road because of mechanical failures of one kind or another. Although that number has subsequently been reduced, there is no doubt that breakdowns on this scale lead to a great deal of cancellation and delay for the travelling public.
The background to this whole problem has been explained to me by the Chairman of London Transport, Mr. Kenneth Robinson. I share his hope that further improvements will now take place, following the increased output of overhauled engines and gearboxes. I should like to pay particular tribute to the chairman of London Transport for the personal and courteous attention that he always gives to hon. Members who approach him. It is most helpful to us to have the kind of detailed replies which he sends. I should like him to know that it is much appreciated.
The problems of London Transport are immense, and no one underestimates the scale of the task which at present confronts Mr. Robinson and his Executive. In so far as this modest Bill makes some marginal contribution to the running of this great undertaking, I personally wish it a fair wind, and certainly have no

119
desire to obstruct its passage through the House.
7.44 p.m.
Mr. Ronald Brown: I join with the hon. Gentleman in his congratulations to my hon. Friend the Member for Battersea, South (Mr. Perry) on the accomplished way in which he presented the Bill. If it does have a fair wind, it will be due partly to the way in which my hon. Friend presented the Bill to us.
I also join in the hon. Gentleman's congratulations to the Chairman of London Transport. We have found him extremely approachable, easy to talk with and most willing not only to investigate what we raised with him but also to talk to us about it. Indeed, the dialogue and rapport which now exists between the London Transport Executive and this House is very much due to his endeavours to make sure that London Transport understands what is happening. I would also congratulate all those who work in the enterprise, because they have a dickens of a job. The harrassment that the staff go through, wherever they are in the enterprise, must make it a soul-destroying job for them. I suppose that one of the most annoying things must be that the chap who does the maximum of complaining is usually the chap who only uses London Transport once in a lifetime when his car is being repaired and who expects a bus to be immediately available.
I have been offered figures about improvements which have been made by London Transport over this last year. They show that it is now covering 5 million more bus miles a year about 3·4 million Underground miles a year than in 1974. The bus lane programme has produced about 200 bus lanes. I am not particularly impressed with it. I have yet to be persuaded that it tends to stop bunching and gives buses an advantage over other road users. Nevertheless, it is an attempt to try to bring reliability to the buses and one should give it some time yet before making a final judgment.
London Transport's decision to introduce bus radio control systems is an initiative that is well worth supporting. I can never understand why buses always seem to be joined together one to another.
120
I make allowances by saying to myself that the London bridges are responsible. One of the strangulation points is the bridges. Buses coming from south to north seem to get fouled up on either side of the bridge. Yet I come out at 6.30 a.m., when there cannot possibly be any bridge hold-ups, and buses are still travelling together.
Like so many other hon. Members, I find it hard to understand why there is this bunching at all hours. It does not matter when one travels, One tends to see two, three or more buses one behind the other. Part of the answer could be that they are scheduled in that way, or they are late running, or that staff have not turned up for the job, or that it is caused by other road users. Yet one can find times of the day when that cannot possibly be the answer because there is nothing else on the road.
I hope that with this radio-controlled system it will be possible to produce a more even running of the buses and avoid the bunching that is not only annoying to the passengers themselves but making it an awful job for other road users to overtake two or three buses in line in the narrow streets of London. Cars follow the buses in these circumstances, and, as a result, we have one long bus queue.
Mr. Dennis Skinner: My hon. Friend should use the buses more.
Mr. Brown: Like so many others, I find that it is easy to talk about it without actually doing it. I agree with my hon. Friend that if I were able to use the buses, as he suggests, I should be only coo anxious to do so. Since my hon. Friend has intervened, perhaps I may point out to him that I represent an area of London which is always a problem. The buses are always crowded. It is very difficult to get on one. There is no Underground in the area. We are a transport-deprived area, a housing-deprived area, an industry-deprived area and a hospital-deprived area. In fact, I am describing a very good inner London area. I am grateful to my hon. Friend for giving me the opportunity to give him that bit of education about some parts of London.
I move now to the fares situation, to which the hon. Member for Ravensbourne (Mr. Hunt) referred. I was one of the aspirants who thought it possible, in order

121
to improve public transport in London, to move towards a free fare system. When one works out the cost of taking the money, of adding it all up, of all the back-up in terms of machinery having to be repaired, of staff having to check the money, and all the concomitant problems, clearly it would be an advantage if we could devise such a scheme. I was one of those who argued that, if my party took control at County Hall, it would look at it.
I believe that we have done a great deal. We can claim that about 50 per cent. of Londoners travelling get free fares, and children travel at a flat rate of 5p. But before we quote statistics of that kind the House should be reminded of the difficulty in obtaining even that.
I was on the London Boroughs Association in 1968 which fought very hard to obtain a system of free fares for old-age pensioners in London. It is worth recalling the fight that we had then. It is true that my colleagues and I were in a minority because the Conservatives controlled both County Hall and the LBA. So we were fighting a rearguard action. But we fought manfully to provide free fares to old-age pensioners.
In the end, that was not acceptable. What the Conservatives asked for and were prepared to consider was some sort of system, if we had to have anything, which meant that old-age pensioners had concessionary fares of some type. But even having grudgingly come to that stage after many months of argument they illustrated one of the schemes which was proposed to be run by Camden in 1969. The basic element in that was that a person had to be over 85 years of age and infirm before he could travel only between the hours of 9 in the morning and 5 in the evening. That was thought to be a good scheme. Not many people took it up, of course. Nevertheless, it was a very good scheme, they thought.
Finally, by 1970 the Conservatives decided that perhaps there was something in this idea, after all. I was on the negotiating team with London Transport and, finally, we got an agreement whereby the boroughs paid the money on a voucher system in order to permit old-age pensioners to travel. The figure was then £3 7s. 6d., which was to be paid for each person who took up the vouchers. All the Labour boroughs were
122
prepared to pay it, but we had some trouble with Conservative boroughs which did not want to act as agents in this way , and I think that the boroughs of Harrow and Bexley still refuse to participate in the scheme for free travel.
But that was agreed generally. Then we gave a commitment that, if the Labour Party took control of the GLC in 1974, it would issue free fares to old-age pensioners. We honoured that commitment in full. In 1974 that is what the Labour-controlled Greater London Council did, not that we had any help from the Conservatives. The Conservatives have done nothing during all that time but kept arguing, sniping, claiming that it was misused, and so on. I do not think that they have ever understood what it means to old age pensioners to be ante to get out and about in the mainstream of life again and to be able to do things without feeling that they are a burden.
This opportunity of having free fares gives old-age pensioners the chance to travel an enormous way and to see people —never mind only their relatives, but actually to see life. It is a great opportunity, too, for us to see that there is more to life than just providing old people's clubs. If old people travel as much as they can, it is a great help to the National Health Service, too, because it keeps them healthy, gives them an interest and saves them from becoming senile.
We tried to get this across to the Conservatives in those days, and they did not understand it. In the coming months we shall see a confrontation between the Labour Party and the Conservative Party. The Conservatives will try to destroy the free fare system. They want to go back to what it was when we were arguing about it in 1968. There is all sorts of huffing and puffing among Conservatives at County Hall who claim that they do not mean this or that. But they were always against free fares, and they are still against them.
It is no good people threatening to put writs on me for saying that. I was negotiating with the Conservatives in those days. That was their view then, and I am satisfied that Horace Cutler means what he says when he says that the Conservatives will not continue the free fare system.
Mr. John Hunt: The hon. Gentleman must not spread this story. He will have seen in the Evening Standard one day last week an advertisement paid for by Mr. Horace Cutler specifically denying the rumour which the hon. Gentleman is now spreading. There is no truth in it. There is no change of policy on concessionary fares for the elderly and for school children in Greater London. This is an election red herring that the hon. Gentleman should not draw.
Mr. Brown: The hon. Member for Ravensbourne is speaking only on behalf of Horace Cutler. I say to him that Horace Cutler will not have free fares for old people. He says "concessionary fares", and that is what he means. He is going back to the period between 1968 and 1970. He does not mean free fares.
Mr. John Hunt indicated dissent.
Mr. Brown: The hon. Member for Ravensbourne can shake his head as much as he likes. If Horace Cutler is putting the hon. Gentleman up to say that, he is misleading him. Horace Cutler is not telling the truth. He genuinely means to scrap the free fare system for old people in London.
Mr. John Cartwright: Is it not a possibility that the fares may be free but that old-age pensioners will be charged for the passes?
Mr. Brown: My hon. Friend is quite right. The Conservatives are up to all the tricks and dodges to get round this difficulty. But I had the advantage of negotiating with them in those days on the London Boroughs Association, and I experienced all these arguments then.
Therefore I come back to the fundamental issue. There can be no argument at all that Horace Cutler intends to change from the present free fare system to some other form which will involve a payment for passes—
Mr. John Hunt indicated dissent.
Mr. Brown: The hon. Member for Ravensbourne does not agree, apparently. If he is right, I ask what all the row is about. Why does Mr. Cutler keep talking about withdrawing the subsidies and referring to concessionary fares? After all, it was he who began to
124
argue in County Hall and who, when he was taken up on it, suddenly realised that he had let the cat out of the bag and tried to keep the favour of those who claimed that transport fares should be raised. Therefore, again I say that I am satisfied that the Conservatives are committed to getting rid of free fares. What ever else they do, I know that they will try to do that.
The hon. Member for Ravensbourne spoke as though he was in favour of free fares generally and he thought that it was awful that the Labour Party had misled people at the last GLC election. I take it, therefore, that he is in favour of free fares. However, his hon. Friend the Member for Sutton Coldfield (Mr. Fowler) has made it clear that he is all for withdrawing subsidies entirely. That is the first thing that he will do if he is ever given the chance. Horace Cutler has made it clear that he will axe all subsidies and transport grants. He has made it clear that there will be no Exchequer grant and no rate fund contribution. What will happen to the fares? Undoubtedly they will shoot up immediately.
I do not understand why the tears should be rolling from the eyes of some Conservative Members because the Labour Party gave free travel to only old-age pensioners and some other categories in London. The fact is that the Conservatives will put up the fares for everyone. That message should go out from this House tonight.
What is the policy of the Conservative Party in London? It will take away the Exchequer subsidy if it has the opportunity to do so. It will take away any subsidy from the rates. I believe that the battle lines are clearly drawn. The Labour Party is prepared to try every means in its power to produce a public service worth having in London. It is attempting to do it with fares that people can afford to pay. It is compassionate to the needs of the old people and the children in London.
I believe that when the people come to vote in May they will find it much better to vote Labour and ensure that they have a council that really cares for the people of London, a council that will provide for them a transport service worth having.
8.2 p.m.
Mr. John Page: The hon. Member for Hackney, South and Shoreditch (Mr. Brown), has let himself go tonight. He always starts the record in a quiet tempo, and we are led to think what a splendid, modest, moderate, middle-of-the-road speaker we have on a sensible, non-contentious subject. But sooner or later the old soapbox comes out and back we go to Shoreditch High Street and the usual smear, sneer and scare campaign.
I think that the hon. Gentleman has displayed the nervousness of the London Labour Party by the excesses of his argument. His speech was so different from that of the hon. Member for Battersea, South (Mr. Perry), although the hon. Member for Battersea, South presented his case in a trenchant and powerful manner. The hon. Member for Battersea, South was extremely helpful to the House and especially to some of those who make illiterate interruptions. I believe that there was only one such intervention in his speech, which he dealt with courteously.
Perhaps I should not go down this road as it is scarcely within order on the basis of the preamble. In fact, I did not intend to mention the matter until hearing the hon. Member for Hackney, South and Shoreditch. The fact is that there will be a budgeted loss figure of £97 million next year whereas when the Labour Party took control of the GLC, London Transport had a profit of £10 million. That was in 1973. By 1975, with its miraculous anti-Midas touch, the Labour Party had turned a £10 million profit into a £93 million loss.
The hon. Member for Hackney, South and Shoreditch asks how the Conservatives will avoid increasing the fares. I think that he is implicitly admitting that the Conservatives will come romping home after the GLC elections. How will they manage not to increase the fares greatly? When the Conservatives were last in office they improved the services and kept the rates down. During their period in office they turned London Transport's finances from a loss to a profit. That was immediately turned into a loss again—
Mr. Deputy Speaker (Sir Myer Galpern): Order. I think that the hon. Gentleman is about to stray from order.
Mr. Page: I was tempted, Mr. Deputy Speaker. It is always my desire, especially when you are in the Chair, Mr. Deputy Speaker, to avoid doing so. As I am leading a Council of Europe delegation to Glasgow in only two months' time, it is your favours I seek.
Mr. Deputy Speaker: I can assure the hon. Gentleman that he will get a very warm welcome.
Mr. Page: I hope that that is meant in the kindest possible way, Mr. Deputy Speaker, and not as sometimes my speeches are received in the House.
Rather uniquely, I shall turn to the Bill for a moment. I refer to the schedule dealing with fines. My hon. Friend the Member for Ravensbourne (Mr. Hunt), in an interesting speech, spoke about the possibility of on-the-spot fines. At that stage the hon. Member for Bolsover (Mr. Skinner) muttered something about liberty. Does he demand the liberty of the individual to cheat his fellow passengers or to cheat London Transport? I have a distinct feeling that on-the-spot fining would be the simplest way in which to deter those who try to defraud the railways.
On-the-spot fining is unusual in this country but I think that we have gone rather a long way towards the concept with parking meter fixed-sum penalties. If on-the-spot lines were introduced, someone who did not wish to pay the fine could have his case considered, first, for example, by the transport local manager or the station manager. Ultimately he could go to the courts if he wished to go that far. My constituents, whose fares from Harrow to London have increased by nearly 150 per cent. over the past three years, demand that those who do not pay fares should be deterred from continuing to take that course.
Mr. Skinner: The hon. Gentleman has referred to my interjection about liberty. Does he agree that if it is right, as we assume he is suggesting, to have on-the spot fines for London Transport—presumably he includes the Underground system—it would also be a libertarian move to have on-the-spot fines in supermarkets, for example?
Mr. Page: I should like to enter into this debate. I have not given any consideration to supermarkets. That is a

127
matter that might be welcomed by the public. I had not given thought to that point.
Mr. Skinner: The hon. Gentleman is a lawyer.
Mr. Page: No, I am not a lawyer. In some ways I only wish I were, as it would make it easier to comprehend the Bills with which we have to deal in Committee.
Mr. Ernest G. Perry: Perhaps it is a blessing in disguise.
Mr. Page: Either a blessing in disguise or a necessary inconvenience. There are occasions when I feel that we have too many lawyers in the House.
Mr. Skinner: The hon. Gentleman just sounds like one.
Mr. Page: These are unexpected compliments from the hon. Member for Bolsover.
Mr. Skinner: It was not meant as a compliment.
Mr. Page: I wish to mention one other point—
Mr. Ronald Brown: Before we leave the subject of on-the-spot fines, does not the hon. Gentleman feel that there is a danger in introducing such a concept before we are ready to do so? With the system of automatic barriers, anybody found on a platform has either lost his ticket or has not paid. However, on some stations there are a hundred ways in which a person can get into the system without paying and without in any way wishing to cheat the system. In those circumstances on-the-spot fines seem ridiculous.
Mr. Page: I am pleased to see that the hon. Gentleman is giving this subject thoughtful consideration. I accept that there are difficulties. Obviously it would be unwise for such a scheme to be introduced before proper preparations had been made. We should examine the matter extremely carefully.
With the system of differential fares on London Transport, clearly a person can buy a 5p ticket and use it for a 50p ride. I am not suggesting that the system should be brought in overnight, but I
128
feel that we should carefully examine the proposal because it could reduce the number of staff needed for supervision.
I wish to deal with the subject of vandalism and stone throwing on the railways. I believe that a fine of £200 is a low maximum fine in view of the major tragedies that can occur. However, in serious cases I imagine that the law can still institute periods of imprisonment.
I read of one sad case recently involving a young lady who was being molested on the Underground system, but other passengers in her compartment did nothing to go to her rescue. That appears to me to be a disgraceful state of affairs. People do not go to the rescue of London Transport servants who at night carry out a dangerous and thankless task on buses and in Underground stations. It is up to the public as a whole to stand up and try to help those who are trying to do a job for the nation.
I turn to another matter that is relevant to the preamble of the Bill. In the old days London Transport designed all their own buses, but when the right hon. Lady the Member for Blackburn (Mrs. Castle) became Minister of Transport she offered London Transport a subsidy if they bought off-the-shelf buses. This has been a disaster for London, because of the number of buses that are now off the road undergoing maintenance. Furthermore, there has been a tragic under use of capital expenditure.
There is another important consideration in that the off-the-peg buses operate a different kind of braking system. On the 183 and 209 bus routes, which involve one-man operated vehicles, the screaming of brakes makes life extremely uncomfortable for those who live on those routes. Certainly those who live near bus stops or traffic lights in residential areas have to suffer the screaming of brakes every 10 or 20 minutes, and this has become a very great nuisance.
The Chairman of London Transport, Mr. Robinson, has taken the greatest trouble in going into this matter. The Science Research Council has now been asked to undertake a fundamental research project into brake noise. I was given this information in a letter from London Transport dated 22nd February. Whatever may be the advantages of mass

129
production of buses to suit London, Glasgow or other cities, surely London—which has some of the longest traffic routes of all the cities in the United Kingdom—should be able to design its own buses since this would have many advantages.
I wish to mention the design and effectiveness of the new turnstile barriers. At Pinner and other stations in my constituency it appears that there are almost as many officials of London Transport working on the platforms as there are passengers, but the queues at barriers seem to be longer than they used to be. There is also the danger that some of these older-fashioned stations are positioning their automatic barriers very near to the edge of platforms—in some cases as near as five feet away. In rush hours that could constitute a danger.
That is all I wish to say on this Bill, which was so gracefully introduced by the hon. Member for Battersea, South. I welcome this opportunity to discuss the affairs of London Transport which for my constituents, and many others, is probably the most important administrative matter in their lives, after the subject of taxation.
8.17 p.m.
Mr. Michael Stewart: I join in congratulating my hon. Friend the Member for Battersea, South (Mr. Perry) on his skilful introduction of the Bill. He appears to have done the job so well that most hon. Members have not thought it necessary to say anything about the Bill's contents. I thought at one moment that the hon. Member for Harrow, West (Mr. Page) was about to deal with the Bill when he mentioned on-the-spot fines, but I notice that such fines, whatever their merits or demerits, are not mentioned in the Bill.
The hon. Member for Ravensbourne (Mr. Hunt)—relying, as I do, on the passage in the preamble—dealt with the efficiency and economy of London Transport. I shall seek to keep as much in order as he did in addressing myself to certain subjects. I had the impression from the hon. Gentleman that if the Conservative Party were to take over London Transport, there would be much less subsidy and lower fares. The arithmetic of the matter is a little difficult. It could only be worked out if it could be shown that there were ways in
130
which the Conservatives could obtain better value for money and run the system more efficiently. However, there was a gap in the argument. In pursuit of greater efficiency the hon. Gentleman appeared to suggest that the remedy was to sack half the staff of London Transport. If the Conservatives propose to do that, I hope that they will make it crystal clear before the election.
Mr. John Hunt: I hope that the right hon. Gentleman is not spreading another scare story from the Labour Benches. I referred in my speech to the natural wastage of 5,000 men a year, and suggested that if those men were not replaced, that would mean a substantial saving. There would be no need to sack the existing men working on London Transport. A comment of the kind made by the right hon. Gentleman is not worthy of him.
Mr. Stewart: The hon. Gentleman quoted with approval, a letter from an evening newspaper. The letter took the view that London Transport could manage with half its present staff. If the hon. Gentleman did not agree, he should have made that clear at the time. I shall do him the credit of accepting that when he read the letter to the House he must have known that it was nonsense.
So we cannot use that means of economising. If we are to economise by any means of substantial reduction in the staff, can we do so and also run improved regular services? I do not believe it. The other method that has been suggested for making services more efficient is shorter bus routes. But there are great doubts about it. Those who have advocated that method have never been able to make the case for it. It would mean greater inconvenience for passengers, more frequent changes and it would almost certainly involve more staff. There is a massive gap in the argument there. I am afraid that there would be cuts in the subsidy that would have to be met by harsher treatment of passengers.
We cannot leave alone this question of the treatment of elderly passengers. Even the hon. Member for Ravensbourne in the middle of his indignant denial was careful to stick to the phrase "concessionary fares". We know what that

131
means. It means that elderly people have to pay something.
What we should like and what we have not got is an explicit statement by those who lead the Conservatives in London that they do not propose to alter the present arrangement whereby at certain times of day elderly people can travel free. There are ways of wriggling round that, as my hon. Friend the Member for Woolwich, East (Mr. Cartwright) pointed out, such as saying that elderly people will not have to pay fares but will have to pay for the passes that enable them not to pay fares.
Mr. Peter Bottomley: I do not know whether the right hon. Gentleman has had time to read the Government expenditure plans, Volume 2, referring to reducing the subsidy on buses, the Underground and ferries by £2·8 million during the next two or three years. Perhaps he could bring that into his argument on subsidies.
Mr. Stewart: No capital city in the world can run a transport system without subsidy. How can it be possible to reduce both fares and subsidy and to improve the quality of services? That is what the hon. Member for Ravensbourne suggested we should do. I am afraid that elderly passengers will suffer if the Conservatives attempt to make his rather shaky arithmetic add up.
We have not had an explicit denial from the Conservatives. They always use a saving clause. When we set that against the fact that the Conservatives opposed the project when it was first advanced—and my hon. Friend the Member for Hackney, South and Shoreditch (Mr. Brown) pointed out that some Tory-controlled boroughs still obstruct the working of the free pass scheme—we are obliged to look upon what they say with the greatest caution. I hope that Londoners will notice this.
Mile End is mentioned in the Bill. Mile End is renowned in English history as the place where King Richard II, then a boy of 9, made the leaders of the peasants' revolt a promise to remedy all their grievances and gave them free pardons—all of which promises were systematically broken thereafter. The moral of that tale for Londoners is "Never trust a Conservative".
8.25 p.m.
Mr. William Shelton: Labour Members have greatly departed from the rather pleasant explanation of the Bill given to us by the hon. Member for Battersea, South (Mr. Perry). They seem to be fighting the GLC elections coming up in May under the guise of discussing the preamble to the Bill.
I am glad that the right hon. Member for Fulham (Mr. Stewart) clearly accepts that the Labour-controlled GLC is responsible for the management of London Transport. I hope that my constituents at least will realise that, because they are getting fed up with London Transport. Using the preamble to the Bill as an umbrella, I should like to say why that is.
I have had only a minor exchange with the Chairman of London Transport—regarding the siting of a bus stop—on which matter I have had courteous treatment but no result. Fares have gone up, as my hon. Friend the Member for Ravensbourne (Mr. Hunt) said, by 146 per cent. in the past two and a half years. At the same time, as far as I can see, subsidies have been going up. They cost £115 million in 1976–77 and £100 million in 1975–76. The last Labour GLC election manifesto promised a move towards free fares. Even though a great many old-age pensioners, I am glad to say, get free fares at certain times of the day, they are not free. They are being paid for in higher rates and taxes and—by those who pay for their fares—in vastly higher increased fares. That is not a satisfactory situation and it is not an enviable one.
There are good reasons why this has been happening. As the miles travelled by London Transport have decreased over the last few years, the numbers of staff have increased, so inevitably costs have increased. If one compares 1973 with 1975, there has been a drop in the passenger miles travelled of just over 3 per cent. In the same period the number of staff has increased by nearly 10 per cent. If that is not Parkinson's law in operation, I do not know what is. As a result, staff have cost more.
I draw to hon. Members' attention a little fact sheet headed "London Transport Statistics". It covers the year 1975. Comparing 1975 with 1974 is interesting. I draw attention to the fact that in 1974

133
London Transport had just over 56,000 staff at a cost of £157 million. In the following year 56,000 turned into just over 60,000—an increase of 4,000—at a cost of £243 million. That means that in 1974 each member of the staff cost approximately £2,809 but a year later the cost was £4,000 a year each. I understand that last year the cost of each member of the staff went up to £5,000. This must happen if one travels fewer miles and has more staff. It is an inevitable reaction. It is far beyond what can be accounted for by inflation, and it is worrying.
Under the Transport Act, the House has ultimate authority over London Transport and therefore if anyone asks why certain hon. Members signed themselves as opposing the Bill, it was so that we could all have an opportunity of saying some of the things on which we feel so strongly about London Transport. I said that it was not inevitable that this should be the case. Without straying too far from the Bill, I want to tell the House briefly about what happens in Munich. All forms of transport in the city and its environs are co-ordinated—buses, trains, trams and the Underground. I understand that in Munich one is supplied with a ticket that will serve on any form of transport within the whole area. The various types of transport are co-ordinated so that the buses arrive at the station in order that passengers may catch a train that is about to leave. The forms of transport complement and do not duplicate each other.
The Munich authorities have exercised extreme skill in reducing staff. All their buses are operated by one man and tickets can be obtained in advance at various places, including newsagents and tobacconists. They have no inspection on entry or inside the buses and trains. Passengers are on their honour to buy tickets and inspectors make random checks and charge an excess fare to anyone who has no ticket. The result is the same as a fine, but there is a psychological difference because it is felt that it is proper for an executive of the Munich Underground to charge an excess fare to someone who has not bought a ticket, but that it would not be right for him to be able to impose fines on the spot.
I do not believe that the people of Munich are more honest than the people
134
of London and I can see no reason why such a scheme is not introduced in London. In Munich expenditure on staff is 55 per cent. of revenue. In London it is 75 per cent.
The Paris Underground and bus system is perhaps most similar to that in London. In Paris about 14,000 employees deal with 3·4 million passengers a day on the Underground. In London we have 16,800 employees for 1·6 million passengers a day—2,000 more employees for half as many passengers.
The right hon. Member for Fulham was asking how economies could be made. Perhaps it could be done by studying what is happening in other great cities. In Paris there are 104 bus conductors. In London we have nearly 8,000. The reason, of course, is that Parisians have one-man buses and we do not.
We have a duty to look at what is happening in London Transport. It is becoming increasingly oppressive for many constituents in the Greater London area, and there are many things that can be done to improve the situation, quite apart from the manning levels that I have already mentioned.
My hon. Friend the Member for Ravensbourne said that many bus routes were too long. I am told that there are 40 routes along Oxford Street every day. The route system was designed, heaven knows how many years ago, to claw its way from one end of London to another. Inevitably, buses are channelled along some of London's main arteries, including Park Lane and Oxford Street. It is a nonsense to have 40 routes along one street.
We must move to short-haul routes. I understand that about 70 per cent. of all journeys are under one mile. We need shorter routes with feeder buses running into them and we should also move towards the system of allowing taxis to take more than one passenger stopping along a certain route. That system operates in many great cities and throughout South America where the public transport system has more to be perturbed about than has London Transport.
We should also have a system of through ticketing which allows people to buy tickets that are valid for bus and Underground. Why should passengers

135
have to queue in Underground stations to buy tickets? There is no reason why they should not buy tickets with their morning newspapers or at their tobacconists. At Oxford Circus Underground station I saw about 18 employees involved in counting, checking, selling, clipping or regulating tickets. In Munich the authorities have one such employee.
London Transport needs a jolly good overhaul. The move by London Transport to limit parking and the movement of cars in central London, which is causing such distress, is the typical reaction of a semi-State monopoly trying to restrict what remaining private competition there is. I should rather see it put its own house in order.
8.36 p.m.
Mr. John Cartwright: The tone of much of the debate was set by the hon. Member for Ravens-bourne (Mr. Hunt) who, with his usual delicate touch, reminded us that the GLC elections are coming up in a couple of months. I shall base most of my comments on the preamble to the Bill which says that London Transport has a duty to provide:
"such public passenger transport services as best meet the needs for the time being of Greater London".
I was sorry that under that general heading the hon. Member for Ravens-bourne and others have seen fit to attack the efficiency of London Transport. In many ways, it is an easy target. We all have experience of constituents with individual horror stories of the buses that did not turn up and of the long waits on cold winter nights for the buses that never came. Every constituent remembers the one night that the bus did not turn up and conveniently forgets the other nights when it turned up on time.
Hon. Members who have raised these individual problems with Kenneth Robinson have always been advised of the three major problems facing London Transport in recent years—staff, vehicle availability and maintenance, and congestion. Fortunately, there is a happier story to tell now than there was a couple of years ago. Staff shortages are less serious, although London Transport is still 13·5 per cent. short of its driver and conductor requirements. The reason it cannot fill these vacancies is a prob-
136
lem over availability of funds. When hon. Members opposite call for still greater cuts in public expenditure, they might reflect that the result of such cuts could well be less frequent and less reliable bus services.
Then there is the question of vehicle availability. The hon. Member for Harrow, West (Mr. Page) reminded us of the problem of London Transport being required some years ago to buy buses off the peg. There was the situation towards the end of 1975 when more than 900 buses out of 6,500 were not available for service because of unreliability. But London Transport, by using its own standards of technical improvement, by enabling alteration of gearboxes, for example, to be considerably extended, by increasing the output of engines and parts in its own works, and by putting some other work out to sub-contractors, has brought about considerable improvement. The number of buses out of service for mechanical reasons is now fewer than 300 and is decreasing. We should put that fact on record and pay our tribute to the tremendous improvement that has been achieved in the past couple of years.
Traffic congestion remains a problem. London Transport is constantly drawing public attention to the need for traffic management measures so that its buses can get through without delays. We should welcome the action by the Greater London Council, particularly in the provision of bus lanes, of which 139 are in operation, covering 27 miles.
We hear sweeping generalisations about the inefficiency of London Transport, but it is worth recalling that last year 86 per cent. of scheduled bus mileage in the area was provided by London Transport, and that 40 per cent. of its mileage was conducted on a one-man operation basis. Again, that is a considerable improvement.
In terms of general performance, London Transport in 1976 operated with its buses 5 million more miles a year than in 1974, while the Underground system operated 3·4 million more miles a year in 1976 compared with 1974. The bus-lane programme has produced proposals for 200 more bus lanes, which compares favourably with the 18 operated under the Tory-controlled GLC. The

137
buses are, as a result, more reliable, and the extra fare income is estimated to be £1¼ million a year.
All this goes some way to dispelling the impression given by hon. Members opposite that London Transport is a wildly inefficient and overmanned organisation. But when we talk of the requirements of London Transport in meeting passenger needs, it is clear to most of us on this side of the House that that involves an element of public subsidy, and a substantial element.
Mr. Peter Bottomley: Rubbish.
Mr. Cartwright: Did I head a cry of "Rubbish"?
Mr. Peter Bottomley: How big would the subsidy be in view of the Government's public expenditure plans?
Mr. Cartwright: I wish that the hon. Gentleman would mutter more clearly so that the rest of us could understand what he was saying. There have been clearly-enunciated attacks by the Opposition on the policy of public subsidy. Indeed, some hon. Members have referred to indiscriminate subsidisation. It is worth recalling that five times as many Londoners use public transport for essential journeys as use private cars. Between 7 o'clock and 10 o'clock in the morning, 900,000 people come into central London by rail, bus and Underground as against 160,000 by private car.
It is also very evident, from our postwar experience, that fare increases on London Transport simply mean more and more passenger loss. The overall loss as a result of the 1976 increases, for example, has been put at 5 per cent.—5·8 per cent. on the buses and 2·7 per cent. on the Underground. The effects of the 1977 fare increases are already estimated to be a further passenger loss of 3–8 per cent. overall—4·6 per cent. on the buses and 2 per cent. on the Underground. This shows that further cuts in subsidies will mean more fare increases, and that will mean in turn simply a further loss in the number of passengers and a worsening of the situation of London Transport.
There have been some suggestions by hon. Members opposite that those of us who draw attention to the problems of the implications of cuts in subsidy are
138
waging some sort of smear campaign. I refute that suggestion. Comments by leading members of the Conservative Party seem to indicate the way in which their minds are turning on this subject. For example, in Commercial Motor of 1st October 1976, the hon. Member for Sutton Coldfield (Mr. Fowler) was reported as saying trenchant things about subsidies at the Commercial Motor fleet management conference. He was quoted, under the heading "Tories hit out on transport", as saying:
"The starting point should be that transport should be paid for by the user."
He went on to qualify that statement to some extent because, it seems, he was not calling for the immediate elimination of subsidies. He added that the public should know what they were subsidising and what it was costing. That does not seem to square with the statement:
"the starting point should be that transport should be paid for by the user."
Mr. Norman Fowler (Sutton Cold-field): I am sure that if the hon. Gentleman has read anything of that speech, he will agree that the subsidies that I was seeking to suggest should be eliminated—which is his own Government's policy—were subsidies on freight transport—namely, to the National Freight Corporation and British Rail freight. If the hon. Gentleman disagrees with that, he disagrees with his own Under-Secretary of State.
Mr. Cartwright: I am grateful to the hon. Member, but that does not get in the way of the basic statement that the starting point should be that transport should be paid for by the user. That was a clear statement of philosophy, and the hon. Member for Sutton Coldfield cannot gloss over it my saying that he was referring to individual items of transport.
The same type of comment has been made by leading members of the GLC. On 2nd November 1976, Mr. Richard Brew, the Tory transport spokesman said that the GLC subsidy to London Transport was taxpayers' and ratepayers' money "directly down the drain". That does not represent burning support for subsidies.
Another GLC spokesman, Mr. Brook-Partridge, in an article in the Romford Recorder, Brentwood Review pledged that a future Tory-run GLC would

139
attempt to ease the burden of public transport on ratepayers and taxpayers.
Mr. Shelton: Do I understand the hon. Member correctly? Is he in favour of subsidies? Would he not rather have an efficient service that did not require subsidies?
Mr. Cartwright: Most hon. Members on this side at least believe that it is impossible to run a public transport service in a city such as London without subsidies if the alternative to subsidies is ever-increasing fares which result in ever-decreasing numbers of travellers on public transport. That is a policy of disaster. If the alternative to that policy is a subsidy, then I believe in subsidies.
Mr. Norman Fowler: The hon. Member has destroyed his own case because what we have under his Government and under various Labour councils is vastly increased fares and vastly increased subsidies. If he is to quote out of context the statements of various Tory spokesmen, will he say whether he disagrees or agrees with the Government's policy to reduce the subsidy element in public transport?
Mr. Cartwright: The Government have not sufficiently understood the problems of London Transport and that is reflected in the funds that they allocate. That is my personal view and that of some of my hon. Friends. We shall go on arguing with our colleagues on the Front Bench about that.
It is not out of place to draw attention to what Conservative members of the GLC have said about what has been done. They say that it is not good enough and that they would go further and cut out much of the subsidy.
There is considerable suspicion, as some of my hon. Friends have indicated, about the future policy of the Conservative Party in London on free fares for the elderly. Mr. Richard Brew, the Conservative transport spokesman—no doubt out of context—is reported in the Evening Standard as saying that the Conservative Opposition would like
"slightly to alter the system of pensioners' passes".
What is a "slight alteration"? Is it possible that pensioners may be asked to
140
pay for their passes? They may still be able to travel free but have to pay for the passes to have the privilege of free travel.
It is not a quotation out of context if I underline the fact that two London boroughs have refused to operate the distribution of free passes. They are Bexley and Harrow. Surprise, surprise, both are Conservative-controlled boroughs. Four other boroughs have indicated that they might drop out of the scheme. Surprise, surprise! Those are Conservative controlled—Barnet, Redbridge, Kensington and Chelsea and Croydon. Does that not seem to indicate some lack of enthusiasm on the Tory Benches for this policy?
I could quote Sir Malby Crofton, the Tory Leader of Kensington and Chelsea and a candidate for the GLC. He was quoted in The Sunday Times on 6th February as saying that pensioners' passes
"are unnecessary costs and the whole thing is getting full of fiddles."
The article went on to say that
"Some of his colleagues feel that the passes should be issued more selectively."
If English means anything, that indicates that there is to be some kind of attack on pensioners' free fares if the Tories win the GLC elections.
I give fair and full notice that we on these Benches will go on raising and pressing for answers to these delicate or indelicate questions because, before Londoners vote in the GLC elections, they are entitled to know what the Conservative Party has in mind regarding free fares for the elderly.
8.52 p.m.
Mr. Peter Bottomley: I should like to join others in congratulating the hon. Member for Battersea, South (Mr. Perry) on the excellent way in which he introduced the Bill. It is clear that the major part of the Bill is non-controversial. The only difference seems to be on what arguments one can put forward regarding the words in the preamble about
"efficiency, economy and safety of operation."
Some hon. Members have strayed into the GLC elections. I should like to follow the line taken by the right hon. Member for Fulham (Mr. Stewart). I remind the House that when those elected

141
to the GLC come up for re-election, it will be the 600th anniversary of the year when Wat Tyler led his band of villains along the A2 up Rochester Way. He was delayed for a couple of days, no doubt by a traffic jam, at the Well Hall roundabout on the Rochester in my constituency. He then went on to Smithfield. The next day he lost his head because those who were in control of London—I think it was the Mayor of Walworth—decided to do away with him.
The problem of London Transport is great and growing. I remind my hon. colleague for Woolwich, East (Mr. Cartwright)—may I put in a plea here to have my constituency renamed Eltham because I sometimes have my constituency confused with his in the Press and, when appropriate, I should prefer the credit rather than him—of The Government's Expenditure Plans, Volume II, issued this month. It spells out convincingly that the Government are gerrymandering the transport subsidies especially to help the Labour Party in the GLC elections.
I note that the Under-Secretary is smiling. I hope that he will intervene to confirm that rather more enthusiastically than he seems to do by nodding and turning away in embarrassment at the moment.
The Government's estimated expenditure on subsidies for bus, Underground and ferry services was £165 million in this financial year. In four years, we are told, the provision will fall to £60 million—the £60 million provided for in Command Paper No. 6393. However, we suddenly discovered that the Government are to provide an increase of £47 million this year. It is spelt out here in black and white that they have done so. It would be wrong to think that that spreads all the way across the country and that this £47 million would not have much to do with the increase in subsidy to London Transport. Does the Minister want me to give way?
The Under-Secretary, of State for Transport (Mr. John Horam): No.
Mr. Bottomley: We see from Table 2.6 that the subsidy has risen since 1973–74, which I understand was the last year that the Conservative-controlled GLC was responsible for London Transport. The total subsidy for bus, Underground
142
and ferry services in England and Wales was £25 million and it increased last year by £164 million. One can assume that the great bulk of this is the subsidy forced on London Transport by the Labour-controlled GLC. This subsidy will be eliminated at the rate of £25 million a year, starting after the elections about which the right hon. Member for Fulham and my colleague the hon. Member for Woolwich, East are so rightly concerned.
It is quite clear that it is one of the most blatant pieces of political financial wizardry which has yet hit this country. It is not the greatest, because the greatest was the promise—surprise, surprise—given in 1973 by the London Labour Party spelt out not quite so precisely in the manifesto to have fares held steady and then to eliminate them. The expert manifesto drafters, especially those in the Manifesto Group, put in words to the effect that they would have consultations to achieve these things, rather than to give a direct commitment to such things as the Dock Work Regulation Bill and one or two other issues. Surprise, surprise, the subsidy went up enormously. Fares have gone up by 150 per cent. and the regularity of the buses has not improved.
Obviously there are difficulties in running a large public transport undertaking in a capital city. I can only suggest that these difficulties have been made far worse by the blatant political interference from the Labour-controlled GLC during the last four years, and also by the way the Government are encouraging the GLC to let the subsidy continue at a high level this year when they know perfectly well—I see the Minister acknowledging this—that it will he reduced drastically in 1977–78 and 1978–79.
It is quite clear that they knew they would lose the election. They want the Labour Party to go out with an increase in fares of only 150 per cent., with the subsidy paid for, in the main, by London ratepayers and taxpayers, including the old ladies and gentlemen who are entitled to the free pass but have to pay taxes on small retirement pensions and vastly increased rates on their homes.
The trend line of the number of passenger-miles covered by London

143
Transport over the last five or 10 years is fairly steady, showing a decline in the number of passengers using London Transport. Perhaps one cause is that car ownership has increased among families in London. We would expect this. The trend line deviated with the introduction of massive subsidies following Labour gaining control of the GLC. The trend line is now going hack to where it was before the subsidies were introduced.
Most people who are fairly skilled in statistics or mathematical economics would say that the figures demonstrated clearly that the London Transport subsidies are worth about £1 for every extra journey above the trend line during the hump years. Obviously if we increase the subsidy drastically, in the first year or two there is an effect but it dies away. I should be happy to give way to any hon. Member who could show that there was not an extra cost of £1 for every additional journey bought by the massive subsidy given to London Transport.
I should like to switch for a moment to the problems that face residents of London living in areas which are not served by the Underground. Here I should like to pay a tribute to London Transport for the effective way in which they seem to be dealing with the problems of violence and theft on the southern part of the Northern Line. We know of the handbag snatchings and muggings on some of the Northern Line stations south of the Thames. The situation may be the same in other parts of London, but I talk only about an area which I know. The measures London Transport is taking are effective and it deserves the congratulations of all those who live in London for what it has done.
Most of the schedules to the Bill refer to regulations concerning the railways, but we should extend a word of sympathy to the staff of London Transport, especially to those on the buses and on the Underground who have had to face intimidation and violence by members of the travelling public. When criticising London Transport, and especially Labour politicians at County Hall, we should not give the impression that we are necessarily criticising the staff of London
144
Transport. They do a difficult job, and they do it well.
I should like to return to the question of the difficulties of people who cannot avail themselves of good public transport facilities. In my constituency, near Falconwood station, there is an area in which there is an old people's home. Many of the old people with free bus passes, who may wish to go to the town hall or to some entertainment after the pass time limit when they have to pay their fare, may have to wait over an hour for a bus. This is inexcusable.
We cannot expect London Transport to provide double-decker buses to go to every outlying residential area in London, but we can expect greater flexibility and perhaps an easing of the London Transport monopoly, and if London Transport cannot provide services they can perhaps be provided economically by private operators. I should like London Transport to be broken up to a certain extent so that the staff in the garages may fill the gaps, because I am sure that they have the greatest expertise and would be able to provide an economic and efficient service for areas which the London Transport Executive cannot cover.
Hon. Members opposite have shown what a sorry record their fellow politicians at County Hall have had in control of London Transport for the past four years. None of their interventions in this debate has justified what has happened. One can simply take a measure of comfort from the fact that they have learned their lesson and will not repeat their electoral bribes for the coming election, although I am sorry that the Government are perpetuating the massive subsidy for this year to try to give their side an advantage.
9.3 p.m.
Mr. Norman Fowler: It is with some temerity that I, a mere West Midlands Member, intervene in this debate. I shall make a short intervention. I congratulate the hon. Member for Battersea, South (Mr. Perry) on the quite exceptional way in which he introduced the Bill. Also, I congratulate my hon. Friend the Member for Ravensbourne (Mr. Hunt) on his speech.
It would be wrong to go into too great detail into the GLC election campaign, but, as we have pointed out, in 1973 the

145
Labour Party made pledges about fares which it could not keep and, worst of all, it raised hopes which could not be fulfilled. That is our case against what its members have said. They were elected on a false prospectus and they will be judged on it. Between 1975 and June 1977, fares on the Underground will have increased by 146 per cent. In the same period, bus fares will have increased by 123 per cent.
Mr. Horace Cutler, who is a doughty fighter in London, needs no defending by me, but the position about free fares is absolutely clear. Mr. Cutler has made it plain time and again that the present free fare arrangements will continue; there is no question of change. Therefore, I hope that the scare stories will end. I say to Labour Members who have tried to raise such fears that the late Nye Bevan said that one does not have to look into the crystal ball when one can read the book. The book for London shows that the Labour Party made pledges which it could not hope to maintain or put into action.
I recognise the constructive manner in which the hon. Member for Battersea, South made his speech. I wish to deal with one important point that he made, with which I have great sympathy, on the question of the penalties proposed in the Bill. Today's debate takes place against the background of the amount of ticket fraud on London Transport. This is not a problem that can simply be swept under the carpet. The fare-dodgers are now costing London Transport millions of pounds. This is a major problem and must be tackled.
Estimates of the losses vary considerably. London Transport's own estimate is that it is losing £6 million a year through ticket fraud on the Underground alone and a further £2 million on the buses. Therefore, on its own estimates London Transport's loss is running at about £8 million a year, and some people believe that it is very much higher.
Taking London Transport's own estimate, we see that the loss of £6 million on the Underground is 5 per cent. of its revenue of £125 million. If this were a private business, this would be the difference between profit and loss, but London Transport is not a private business. It is clear that in public transport
146
terms it means that the vast majority of honest passengers have to pay for the evasion of the minority. That does not seem to be a position that we should condone or accept for one moment.
Let us be clear about the kind of offences with which we are dealing. Even now, despite what was said by the hon. Member for Battersea, South, there seems to be a curious public tolerance of the fare dodger in this country. When I went to see London Transport in connection with the Bill I asked what were the most common offences of evasion with which it dealt, and it gave five examples.
The first is the case of a passenger who buys two season tickets for short journeys at each end of his daily journey and thus evades the fare in the middle. London Transport gave an example of a husband and wife who each had a season ticket between Bank and Chancery Lane and another between Gants Hill and Wanstead, so they were able to travel free between Wanstead and Bank. They had been doing this not for months but for some years until they were detected.
The second example is a passenger buying a minimum fare ticket and making a declaration of an excess fare of the minimum amount at the other end, therefore once again evading the cost in the middle. The third example is the use of a season ticket by members of the same family.
The fourth example is the purchase of tickets for short journeys by a number of people, one of whom passes out at the other end, buys the appropriate number of minimum fare tickets and returns, thus enabling the others to get out at a succeeding station to which those tickets are valid. One example concerned a group of men who travelled between Rayners Lane and St. Pauls. After detection it was discovered that they had clubbed together so that one of them could buy a season ticket between Rayners Lane and St. Pauls. All of them got out at Chancery Lane, where he would go through the ticket barrier exhibiting his valid ticket and would buy from the machine tickets between Chancery Lane and St. Pauls, which he would distribute to his companions who would get out at St. Pauls. For their return journey they had bought tickets from Rayners Lane to South Harrow. The case was detected

147
by a station foreman at Chancery Lane. London Transport states that it is generally suspected that a large number of people are practising this type of conduct and have not yet been detected.
The fifth and final example is the plain forgery of expiry dates on tickets. Again, according to London Transport this is a very common occurrence and consists of the alteration of the date or month of the season tickets in such a way that it cannot be readily detected by a ticket collector in a crowd. A common example would be the alteration of the "R" in "MAR" for March to a "Y" making it "MAY".
The reason I give these examples is to show that we are not dealing with passengers who have made a mistake, but with those who have set out deliberately to defraud London Transport. That is why I think it quite right for Horace Cutler to have taken such a firm stand upon this question.
The question then arises how we are to deal with the problem. The Bill introduces new penalties. By any standards a £200 fine for travelling with intent to avoid payment of a fare is a heavy penalty, but we should not deceive ourselves that penalties alone will stop the evasion. The whole history of crime in this country shows that the penalty is only part of the deterrent. The other part is detection. Heavy penalties without the deterrent of detection will be ineffective.
Let us therefore look at the question of protection in relation to the penalties here proposed. The difficulties for London Transport staff in checking the tickets of passengers is illustrated by the position at Oxford Circus. In the peak hour 20,000 people are using the station. London Transport says that this means that the available staff is checking 70 or 80 tickets a minute, which is far too many for any kind of accurate check to be possible.
The obvious alternative to this is the installation of automatic fare-collecting equipment. Equipment of that kind combats fraud and it saves staff when the cost of staff is over two-thirds of London Transport's total cost. That is obviously an important factor. There is no doubt that such equipment can work success-
148
fully. It works on the Paris Metro and in the United States, notably on the Bay Area Rapid Transport System in San Francisco, which I visited last summer.
The equipment there is so sophisticated that if one buys a $5 ticket and then makes a 50 cent journey the equipment at the destination will check the ticket and give it a credit of $4·50. Not surprisingly, this has deterred the San Francisco fare dodgers in a very big way.
We should pay tribute to the fact that London Transport is developing a new system here. That system need not be as sophisticated as the example I have quoted, but the equipment that it has in mind will do a great deal to deter evasion.
It is also desirable to go over to a system where the passenger cannot enter the Underground without having a ticket. As has already been pointed out in our debate that is crucial. This again is entirely feasible. Even when ticket offices are closed it is possible to have "authority to travel" tickets for the minimum price, and such machines are being experimented with in London Underground stations.
If we went over to that system it would be possible to consider not on-the-spot fines—I do not think that is the right phrase because it implies money passing and that would be wrong—but a system of fixed penalty notices for those travelling without tickets. That is a much better suggestion and it is by now the traditional way of doing things in this country, given always that the defendant has the right to a trial in court.
I sum up the basic comments in my brief intervention. First, fare evasion is not a crime that we should simply ignore but a crime that loses London Transport at least £8 million a year and puts an extra burden on all other passengers. That message should go forth. I entirely support what has been said on that subject. We should make a much more determined effort than we have in the past to combat this form of crime.
Secondly, the new penalties in the Bill, big, sweeping and wide as they are, will not be enough by themselves. The real key is detection. The biggest deterrent would be clearly to demonstrate the likelihood that evasion will be detected.

149
I suggest, therefore, that what is needed now is an all-out war against the fare dodgers in London, not only for the good of London Transport but for the good of the vast majority of the travelling public. This is a contribution that can be made to the finances of London Transport.
We should remember that in 1973 95 per cent. of revenue came from the business income of London Transport. Last year the figure was down to 69 per cent. There is a long way to go to get London Transport back on to an even financial keel, but better measures against evasion would, in my view—and I entirely support what Horace Cutler has said about this—make a very substantial contribution to making the position right.
9.16 p.m.
Mr. Ernest G. Perry: With the leave of the House, Mr. Deputy Speaker, I should like to reply to the debate.
I join with practically everyone who has spoken in the debate in the remarks about the way in which this subject has been handled tonight. With so few opportunities for London Members, on either side of the House, to discuss London, and with a GLC election two months hence, we were bound to have party interests being discussed at the same time as the merits of the Bill. However, despite the chit-chat between hon. Members on the question of the GLC election, the debate and the Bill have served a very useful purpose.
The hon. Member for Ravensbourne (Mr. Hunt) and I became Members of this House at the same time. On questions about London he has always been most open, and he has been prepared to listen and to try to analyse the problems of London, be they concerning transport, housing or anything else. I thank him for his intervention this evening. He has contributed something useful to the debate.
The hon. Member for Harrow, West (Mr. Page) has apologised to me for having to leave early to attend a meeting in his constituency. He raised the question of violence, and mentioned stone throwing. I saw a newspaper article on Sunday concerning that subject. I am a Chelsea Football Club supporter, and I read that the coach taking the Chelsea team home from Bolton at about 5 o'clock or 6 o'clock on Saturday evening
150
had a steel bolt, 8 inches long, thrown through one of its windows.
That is the sort of vandalism and violence that we are experiencing on public transport. That is the sort of thing that we must stop. People caught doing such things should be fined or should have some sort of deterrent punishment imposed on them so that they do not repeat such acts. I agree with everything that has been said on that subject by almost every hon. Member.
The hon. Member for Streatham (Mr. Shelton) went in great detail into the question of staff, costs and everything else, and the increases in those spheres, concerning London Transport. I am sure that he will remember, as I do, that in 1973 the then Prime Minister, the right hon. Member for Sidcup (Mr. Heath), because of the state of London Transport and the complaints at the time, telephoned Sir Desmond Plummer in Tokyo and asked him to return to London straight away and put London Transport to rights. Sir Desmond came back. Of course, increased pay led to increases in staff. Unfortunately, we cannot now see the benefits of the action then taken, because there is still the difficulty of obtaining staff for London Transport. To some extent that is caused by the violence and vandalism that occurs on its services. The hon. Gentleman paid tribute to the staff of London Transport, as have all hon. Members.
The hon. Member for Woolwich, West (Mr. Bottomley) can always be expected on these occasions to speak for those who serve Londoners I appreciate his point about the distances that some old people have to go for a bus. I am sure that London Transport will consider that.
The hon. Member for Sutton Coldfield (Mr. Fowler) is not a London Member, but his trenchant remarks about fines deserve great attention. His only fault was to explain so clearly how people can defraud London Transport. His speech deserves to be read by everyone in London, but I hope that few crooks will read it.
Mr. Norman Fowler: I am sure that the hon. Gentleman will agree that those who go in for these dodges know them already without any help from me.
Mr. Perry: I would concede that.
The hon. Gentleman also mentioned many different systems of fare paying. I understand that New York has a standard fare of 50 cents for any distance. I do not suggest that that system is better than ours, but we need to examine standardisation of fares and the employment of fewer staff and more machines.
I agree with the tributes paid to bus and Underground staff. Especially at night, theirs is not an easy job. Even at Westminster, where there are women ticket collectors, I have seen men offer 10p when they have obviously come a greater distance or rush off after having given up a ticket for too short a distance. In one case, I saw an attempt to intimidate one of the women collectors.
The House must tell these members of the staff that we support them and that if we can improve their lot by stopping fraud we shall do so. I appreciate the services that London Transport gives to the fare-paying public. I hope that the Bill will receive a Second Reading.
Question put and agreed to.
Bill accordingly read a Second time and committed.

MISS KATHLEEN MERRITT
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Stoddart.]
9.23 p.m.
Mr. Michael Mates: I am grateful for the opportunity of raising tonight with the Minister a matter which has been concerning me for some months and about which one of my constituents, Miss Kathleen Merritt, feels she has a real grievance.
Let me say at once that I am not seeking to make any party points nor to criticise decisions which I have no doubt have been taken in good faith. I am seeking justice for Miss Merritt, and I hope that at the end of my short remarks it will be plain to the Minister what he should do. To this end I have provided him with a copy of these notes so that he may be quite clear of the details of the case which I am making and the strength of my argument.
152
Miss Merritt lives at Bridge House in Petersfield in the centre of the town, fronting on the A272, which is the main east west road in the area going from Winchester to Midhurst and on through Sussex. Her house is same 50 yards west of the main A3 trunk road. Because of the constant problems of traffic passing through Petersfield, both from north to south on the A3 and east to west on the A272, it was decided to introduce a circulatory system to ease the flow of traffic. Incidentally, this was an admirably sensible decision which has been proved to work excellently in practice, and the Department is to be congratulated on the planning and execution of this work.
There is a narrow drive into Miss Merritt's house which is not ideal but which has served her well over the years. In order to drive into the drive, Miss Merrit, and anyone who visited her, had to pull slightly out into the carriageway in order to execute safely a left turn. As long as this was a two-way road, this was a perfectly safe and feasible manoeuvre.
As a result of the introduction of the circulatory system, the A272 has become a one-way road from west to east and has been divided into lanes with indicators to the traffic as to which lane to take. This has made the manoeuvre I have just described a different matter altogether, for if one pulls out into the road, albeit on making a left-hand turn indication, there is the possibility that traffic behind will come on the inside of the car and thus make a left turn potentially dangerous. In addition to this, where there once was a halt sign, there is now only a give-way sign, and thus the traffic is moving much faster than it ever did before.
As a result of these factors, Miss Merritt complained that her life had now become far more difficult and asked the Hampshire County Council, through her councillor, Major Hugh Rose, whether they would make a minor adjustment to her entrance in order to allow her to continue to enter and leave her property safely. This proposal was supported by the county surveyor of Hampshire and a request was sent to the regional controller of the Department of the Environment at Guildford.

153
In his letter of 10th September 1975 the county surveyor said
"The existing access is such that a driver has to pull out into the centre of the carriageway before turning into the drive. This operation was reasonably safe when the road carried two-way traffic but since the one-way system was introduced, following drivers—under the impression that the vehicle in front is pulling out to go round the system—overtake on the inside."
This application was turned down, and the county surveyor felt so strongly about it that he wrote again on 2nd April 1976 requesting that the decision be reconsidered. This further request was denied, and the matter was brought to me. I visited the site and then the surveyor's department of the Hampshire County Council at his offices in Winchester. I discussed the matter with the county surveyor and his staff and examined the plans and implications involved.
I then wrote to the then Minister at the Department of the Environment, who declined to change the decision of his advisers in a letter to me of 8th July, saying amongst other things that
"these dangers arise entirely from the inadequate design of the entrance, for which, I am afraid, the Department cannot be held responsible."
I found this argument unacceptable and wrote again, asking for it to be reconsidered, and I received a further reply on the 31st August which contained the remarks which have caused me to seek to raise this matter in the House. The Minister's predecessor said:
"But the Department would have no moral obligation—and certainly no legal obligation—to improve at public expense a private access, even if the difficulties of using that access had increased because of alterations to the flow of traffic which passes along the adjoining public highway."
That the Department has no legal obligation to redress Miss Merritt's complaint is not in contention, but to say that the Department has no moral obligation to improve the access, even if the difficulties have been increased because of alterations to the flow of traffic over which she has no control, is to my mind a quite unacceptable principle upon which to govern.
It is also less than acceptable that on one occasion the Minister should write to me and say that the Department has no responsibility at all and then say that, if the Department has a responsibility, it
154
is only a moral responsibility and, therefore, that the Department should not discharge it.
I have deliberately not mentioned cost up to now because I am concerned with the principle of this case and not the costs. Nevertheless, it is not insignificant to the force of the argument that we are talking about public expensiture of approximately £100.
So these are the facts; and I ask the Minister to bow to the overwhelming opinion that Miss Merritt's complaint should be heeded. Upon checking with the Hampshire county surveyor that I was going to quote him correctly he said to me, "Had it been my decision, whatever the legal situation, I am in no doubt that our members would have directed me to out matters right for Miss Merritt". Her county councillor is of the same opinion, as is the Chief Inspector of Police in Petersfield, Mr. Chandler, with whom I have also spoken. He has confirmed that it is his opinion that the dangers for those seeking to enter or leave Miss Merritt's property have increased because of the increased speed of the traffic flow and the fact that the circulatory system has turned the road outside her house into a one-way street. His urgent recommendation is that something should be done. For what it is worth, I have seen the site, too, and I am in full agreement with the expert opinions which have been expressed.
Therefore, I put it to the Minister that his Department has nothing to lose in reversing its previous decision—certainly not in creating a precedent, which is very often the fear of Ministers, because no one is suggesting that the Department has a legal obligation; certainly not in losing face or popularity, because this will be seen as a humane and understanding act of government. All those who have actually to do the job are keen to do it. They realise that, as local representatives of government, they have a moral obligation to do it.
It seems to me that a case such as this, based, as it is, on the good will of government rather than on the fine legalities, can be decided by the Minister in the interests of the good of the community as a whole and of my constituent in particular without any repercussions

155
with the Government Department concerned.
9.31 p.m.
The Under-Secretary of State for Transport (Mr. John Horam): The hon. Member for Petersfield (Mr. Mates) has explained very clearly how strongly both he and his constituent, Miss Merritt, feel that she has suffered an injustice at the hands of my Department. He has already striven diligently on behalf of his constituent in correspondence with me and my predecessor—possibly my predecessors—and he was good enough to let me know the basis on which he proposed to argue his case tonight.
I am grateful to the hon. Member for raising the matter in the way that he has because it gives me an opportunity not only to explain our attitude in the case which he raised but also to say something in a general context about the effect of an alteration in traffic patterns by an action of the highway authority, especially on those who live alongside the roads concerned.
I say straight away that these are very difficult problems. Even in the short time that I have been at the Deparment of Transport we have had more than one Adjournment debate on problems of compensation. They pose great and sometimes even tragic difficulties with the consequences for people's lives and property which can sometimes arise from decisions about roads which are taken in good faith and very often for the benefit of the majority of the community but which result in loss in one or two instances.
Before coming to the specific issue, however, I must set this in the context of the small country town of Petersfield, which lies astride a trunk road, that trunk road being one of the more important roads in the national system of routes for through traffic. There are many such towns throughout the country and in most cases the traffic problems of these towns will be solved finally only by the provision of bypasses, because the property destruction that would result from improving the existing roads through the towns to modern standards would literally be unthinkable.
156
Because of the priority demands of major projects on the limited resources available for trunk road construction, however, inevitably many of these bypasses are still many years from construction. Accordingly, it is sensible to undertake on the existing roads through the towns small schemes of comparatively limited cost with little or no property demolition which nevertheless can often make a considerable contribution to the relief of traffic problems and enable an existing road to serve its purpose as a route for local and through traffic until the town can be bypassed. Almost invariably, schemes such as this not only have an immediate value but continue to provide the relief of problems for local town traffic which otherwise would persist even when the through traffic has been removed.
Petersfield is one such small country town. Through it passes the A3 trunk road, the primary route from London to Portsmouth. The considerable volume of traffic on this road has to pass through the town, and doubtless many local people feel that the town is not blessed by having the A3 trunk road running through its major built-up area. Moreover, it must not be overlooked that the road is also carrying a fair amount of local traffic from the surrounding area which has business in the town.
Near the centre of the town, where the trunk road turns through 90 degrees from a north-south to an east-west direction, it is joined by the A272 principal road from the west. This junction was the cause of much traffic delay and congestion, particularly at peak periods, and in summer months traffic queues extended outside the town to the north and south, sometimes for a mile or more. The noise and fumes from the back-up of traffic in the town generally and particularly along College Street, the north-south section, must have been a cause of considerable annoyance and discomfort to the local residents. Fortuitously, lying about 150 yards to the east of the trunk road and running parallel to it adjacent to the Tilmore Brook was a stretch of waste land which provided a suitable route to enable a new section of trunk road to be constructed to carry southbound traffic. A one-way circulatory traffic system

157
could thus be established to divert southbound traffic on to the new section of road diverted away from the A272 junction, northbound traffic continuing to use College Street and Station Road.
The relevant orders were made in 1973. Miss Merritt, on whose behalf the hon. Gentleman has raised the matter, was not one of the objectors at that time. Subsequently, the intention was advertised to make a traffic regulation order to provide for one-way working in the appropriate lengths of College Street and Station Road, and objections from the public were invited. In fact there was only one objection—not by Miss Merritt—and after it had been carefully considered the traffic regulation order was made.
The contract for the scheme was let in July 1974 and the new length of trunk road was opened to traffic in 1975, when the one-way working system was also brought into operation. The hon. Gentleman has said that the decision to carry out the scheme was correct and that it is working excellently in practice. I thank him for his complimentary remarks on its planning and execution.
Station Road, in which Miss Merritt's house is situated, is the east-west section of the trunk road on the north side of the circulatory system. No part of Miss Merritt's property at Bridge House was acquired for the scheme and, while a slight widening on the opposite side of the road was carried out, there were no works at ail on the highway immediately fronting Bridge House.
The hon. Gentleman has claimed—this is the nub of the issue—that it has become more difficult and dangerous for a car to enter the driveway of Miss Merritt's house because of the change of use of the road. It is said that the car has to pull towards the centre of the road before making the turn and, because the road is now one-way, drivers following behind the car entering the drive assume that the car is moving across the road and try to pass on the nearside, thus making the turn-in a potentially dangerous manoeuvre. The hon. Gentleman has said that the access to the driveway was adequate—I think his words were "safe and feasible"—before the traffic pattern was changed and that my Department has a moral obligation to pay the £100 or so which is needed to alter the entrance to the driveway.
158
In support of his opinion about the difficulties in entering the driveway of Bridge House, the hon. Gentleman has quoted extensively from statements made by the county surveyor and his staff—some of whom I have had the pleasure of meeting, including Councillor Rose, who I think is chairman of the transportation committee of the county. I met Councillor Rose and others at the annual meeting of the regional consultative committee.
I have considered the hon. Gentleman's arguments carefully one by one. His first argument is whether access is "safe and feasible", to use the hon. Gentleman's words.
Mr. Mates: Adequately.
Mr. Horam: Well, adequately safe and feasible. I think that the answer to that, honestly, must be "No". The access is parallel to the road and only 4 ft. from it. In other words, the footpath is approximately only 4 ft. wide and the access is about 9 ft. at the widest point. To get into that access, given the narrowness of the pavement, it was necessary even before the change to pull out slightly into the centre of the road to make the manoeuvre to turn leftwards into the narrow drive. That situation is the same now as it was then. Even before the change one could not say that there was a satisfactory situation.
Mr. Mates: I am not trying to suggest that my proposals would be ideal, but the Minister slightly misunderstood my point when I spoke about the situation being safer. In a two-way street with traffic coming the other way, if a vehicle pulls out into the middle of the road with its indicator on, the traffic behind will know what that vehicle is doing. At present with the one-way street there is a large volume of traffic that pulls out across the road to go round the circulatory system. It is a question not just of adequacy but of safety.
Mr. Horam: I understand that point and I was about to come to it. I was trying to establish that the physical circumstances of this manoeuvre have not changed in respect of the alignment of the road and the drive. The situation was not entirely satisfactory previously.
Has the situation been made more dangerous by the one-way system? The

159
fact that it is a one-way system means that one can move out more than one would have been likely to do on a two-way system. If that is done in a sharp or abrupt way without sufficient cause, I can see that those following behind might be misled by the move into the centre and might attempt to go on the nearside.
I should like to stress two points. First, this seems to be a matter of driving behaviour. If a person is taking that road and pulls as much into the centre as is necessary and at the same time puts on a leftward indicator and does not forget to do that, I do not think that anybody behind would be misled into thinking that he was about to take a rightward turn. I concede that it is possible for a person to be misled if actions were taken in an abrupt manner if the person suddenly slewed to the right and put his indicator on and if that were not noticed by somebody on the inside lane. However, I submit that fundamentally the turning manoeuvre is the same, that the person concerned has more opportunity to undertake such a move properly now without oncoming traffic, and that if the move is carried out properly, it is not substantially more difficult or less safe than it was.
The second point is that we have removed the possible danger of oncoming traffic. If the manoeuvre—admittedly always difficult because of the nature of the drive—had been executed with oncoming traffic, it would have involved equal danger. That danger has now been removed.
The hon. Gentleman also mentioned the volume and speed of traffic. He said that the "Halt" sign just before Bridge House had been removed and replaced by a "Give Way" sign, and he suggested that in the nature of things a one-way system means that traffic will go faster than on a two-way system. I agree that the traffic will go slightly faster, but it is subject to a 30 m.p.h. limit. Therefore, the extent to which a vehicle can go very much faster is extremely limited, even though people from time to time do not keep entirely to the 30 m.p.h. limit.
I would say that the access to Bridge House has always been unsatisfactory, remains unsatisfactory, and should be improved, but I do not think that the situation has fundamentally altered as
160
the result of a change in traffic patterns. I believe that it is difficult, even for experts, to make a total judgment as to the extent to which it may be a little more or a little less difficult. Perhaps access is a little more difficult but the traffic change has not totally altered the situation, which springs fundamentally from the nature of the access of Bridge House in relation to the road, which is the kind of access that would not have been permitted if, for example, a new house were now to be built there. On these grounds, as far as I can see—having the facts that have been made available to me and that the hon. Gentleman has put forward to me in correspondence—the situation has not fundamentally changed.
The hon. Gentleman also made the point that the Department, as a result of the changes in the system—and this is really a separate point—has a moral obligation to help in such circumstances. The hon. Gentleman made that point strongly and generally. I am sorry if he felt misled by any discrepancies in the correspondence that he has had with the Department about any obligation—moral or legal—that the Department may or may not have.
Obviously, in a perfect world all the people who gained from a scheme of this kind should use the benefit that they gained to compensate fully those who have lost for what they have lost. But this is not a perfect world and we cannot do that. Just as we do not tax those who may have benefited from the scheme—and the hon. Gentleman concedes that the majority benefited from this scheme and that there has been benefit to the community—equally we have to limit the extent to which we can compensate those who may have lost. The hon. Gentleman himself said that this matter was beyond the Government and party points and had been established for some time, but the legal position is that we compensate only in circumstances in which we actually take land for the improvement in question.
While there may be an ultimate moral obligation on authorities that make improvements of this kind, in practice one cannot fully reflect that in the law. Indeed, if we had to meet that moral obligation we should have to penalise those who benefited from the change just as much as

161
we were trying to compensate those people who lost.
Mr. Mates: That is a doubtful proposition. We are in Government to make things better for people. To say that we must tax them because those who have suffered must be compensated is a wide philosophical argument. That point is not as easily accepted as the Minister said. Perhaps the Minister will come to the point that it is not that the authorities and the experts do not feel that they should carry out this improvement, or that they do not want to do so, but that they are not being allowed to do so by the Minister's Department. Why cannot such a small decision be delegated to Hampshire County Council? Why cannot the county surveyor, having taken advice and being on the spot and intimately concerned with the whole matter in a way that the Department cannot be, be allowed to decide? He and everyone in the council wants to do it. The Minister has not yet covered the point that all expert opinion in Hampshire says that this entrance should be changed.
Mr. Horam: With respect, there is simply a difference of opinion whether the problem has resulted from the change in the system of traffic. There is a difference of opinion between my Department—it is the regional controller who has the say in this—and the Hampshire surveyor. They are qualified engineers and, as I know from my own officials, have seen it at first hand. One of my
162
officials has been down today to look at it again.
It simply is the case that the Department officials do not agree with the county surveyor's opinion that the difficulty of access and the danger of the manoeuvre have been a consequence of the one-way system. On the contrary, they say that it is caused essentially by the unsatisfactory nature of the access that was unsatisfactory before and remains so and that there has been no significant worsening of the situation as a result of the one-way system. They say that this is a private improvement that we should like to see made but upon which we cannot justify public funds being spent.
It is obviously difficult to draw the line in this matter. I am sorry if I sound philosophical, but I am trying to explain to the hon. Gentleman that we think deeply about these matters in the Department, because we have to. I understand his remarks about the way in which the problem has arisen and the general question of obligations, but on both counts I disagree, on the evidence that I have, that we could legitimately use public funds to compensate someone in the circumstances that he has recounted. With regret and unless further evidence comes forward, I have to take this line and resist the hon. Gentleman's claims for the moment.
Question put and agreed to.
Adjourned accordingly at nine minutes to Ten o'clock.