HC Deb 11 July 1977 vol 935 cc39-105

3.55 p.m.

Mr. Charles Morrison (Devizes)

I beg to move, That this House welcomes the new-found acceptance the Leader of the Liberal Party of so many of the policies set out in 'The Right Approach', but deplores his refusal to take the political action to secure their implementation. It would be improper or out of order if I were to imply that there had been anything other than complete impartiality attaching to my good fortune in initiating this debate. But I must thank the gods who decide who should have good fortune and who guided your hand, Mr. Speaker, towards my number in the Ballot not once but twice.

For 13 wasted years I have put my name into the Ballot on virtually every possible occasion. For 13 years I might just as well have saved myself the trouble. On the last occasion on which there was a Ballot my name came out third and today I was lucky enough to be first.

When I drew third place in the Ballot I tabled a motion in support of electoral reform and I was tempted to do so again today. The electoral system occupied a good deal of the time of the House last week, and so I selected a subject which I hope is of more immediate interest to the House.

If I had tabled a motion on electoral reform I should undoubtedly have re-received the support of the whole Liberal Party, whereas for this motion, in all likelihood, I shall receive the support of only about half of the Liberal Party.

Mr. A. J. Beith (Berwick-upon Tweed)

Is the converse not also true? If the hon. Member had tabled a motion on electoral reform he might have received the support of less than half of the Conservative Party whereas he may receive the support of all the Conservative Party on this motion.

Mr. Morrison

That is a matter of opinion and it will not be put to the test, at least not today.

At the outset I should like to make it clear that, unlike the Leader of the Liberal Party, I have never been opposed in principle to electoral pacts or arrangements between parties. Nor am I against the Liberal Party as such. How could I be against pacts when my party has made such arrangements in the past, for example, with the Liberal Nationals? Who can be sure that at some time in the future the electorate will not decide that similar arrangements should be made once again?

One can foresee the kind of possibility. If, in October 1974, the electorate had returned another Parliament with no overall majority for one party, it would hardly have been possible to go back to the electorate another six or eight months later with yet another request to them from the Prime Minister for a clearer decision. The electorate might not have wanted a one-party Government. If that had happened, Parliament would have had to make the best of it, and it might have to do so at some time in the future.

But the electorate did not so decide in October 1974. According to the electoral system that we use, albeit with its lack of logic, common sense, or anything else, the electorate opted for a Labour Government and that, to its increasing chagrin, is what it has had and what, because of the Liberals, it still has.

I am not against the Liberal Party—at least, its supporters—certainly in my part of the country. Most of those who claim to be Liberals, as far as I can make out, say and think virtually the same things as those who are Tories. The motivation of those who vote Liberal seems little more than a romantic and anachronistic belief that politics are still the same as they were 70 years ago, without an appreciation that the most sensible of Liberal principles and policies were incorporated into Tory thinking many decades ago.

To judge by the latest pronouncement of the Leader of the Liberal Party—what has been termed the ten commandments—the right hon. Gentleman has not yet appreciated this point, either. Had he done so, he could just as well be using those commandments as the basis for a decision by him to join the Tories.

So why did the Liberals do as they did on 23rd March? It was not as though there had been a close or developing connection between the Liberals and the Labour Party over a long period. Instead, the decision to form a pact was sudden, unexpected and contrary to the wishes of at least a considerable proportion of Liberal supporters in the country. [An HON. MEMBER:" Fewer than the hon. Gentleman thought."] I never hear sedentary interruptions.

So swiftly did the arrangements occur that the Prime Minister might have said of the Liberals, just, as that greatest but most philandering of politicians, Talleyrand, said of a new mistress, "To avoid the scandal of flirting she consented immediately". Horace Walpole referred to the same lady as a talkative trollop. In the same vein, one wonders at the nature of the conversation in that moment of bliss when the left hand side of the Labour master first came into contact with the right hand side of the Liberal mistress. To judge by the comments of some hon. Members below the Gangway on the Government side, it was not and is not very comfortable.

Naturally enough, in his speech on 23rd March during the "no confidence" debate, the Leader of the Liberal Party attempted to justify this arrangement, but I believe that his justification was very thin. The right hon. Gentleman said: the lack of stable continuity in the planning of our economy is one: of the deeply destructive factors in our economy. He went on: we have not been conspicuously successful in the continuous planning of our economy. A little later he said: industry requires a much longer period of stability. Those are fine words and few would disagree with them. But how can they be reconciled with the right hon. Gentleman's other statement: The agreement lapses at the end of the present Session."—[Official Report, 23rd March 1977, Vol. 928, c. 1311–19] I know that the right hon. Member for Huyton (Sir H. Wilson) used to say that a week was a long time in politics. Therefore, it could be claimed that any advance on a week is progress in terms of economic management. But the period from March to—again I quote—"the end of the Session"—was barely ambitious and singularly unlikely to, be adequate to provide the stable continuity so desired by industry. All right: the pact may be renewed; equally, it may not be. So where is the continuity?

The fact is that from the moment the Labour Party was unable to support itself in this House a General Election situation existed. When that happens, far from stability, there is the uncertainty that delays economic decisions and investment decisions by industry and that can be removed only by holding a General Election.

The Leader of the Liberal Party has claimed that the pact has removed Socialism from the agenda.

Mr. Dennis Skinner (Bolsover)

It was never on. We never saw it.

Mr. Morrison

I am sorry if the hon. Gentleman does not believe that it was on. But Socialism has been removed for the time being anyway, partly because the Socialist parts of the agenda based on the last manifesto have been completed, partly because of the overall arithmetic of the House, and partly because of the economic situation and the International Monetary Fund. With or without a pact, new Socialist measures are simply not a starter at present, thank heaven.

On the other hand, so far as I know, the Liberals have not suggested any repeal of Socialist measures. In spite of their violent criticism of Socialism in the past few years, they have not tried to force any repeals of legislation on this Government as part of their bargain. Nor is there any question, so far as I know, of the Liberals forcing a moderate manifesto on Labour at the next General Election.

Mr. Emlyn Hooson (Montgomery)

As the hon. Gentleman's motion refers to "The Right Approach", will he point to any suggestion there for repealing any of the Socialist policy, and, if so, which part?

Mr. Morrison

I am coming to "The Right Approach" later, if the hon. and learned Gentleman will contain himself until then.

Mr. Robert Adley (Christchurch and Lymington)

My hon. Friend has been asked about "The Right Approach", and he will be coming to the part about the aircraft industry, I know, in due course. Is he able to confirm that the Lib-Lab pact was announced before the date of vesting for the nationalisation of the aircraft industry?

Mr. Morrison

As I knew that it was my hon. Friend's intention to attempt to catch the eye of the Chair later, and as I had a lot of other remarks to make, I felt that I should not concentrate on the aircraft industry. I feel certain that my hon. Friend will expand on that theme when he has the opportunity.

So far as I know, there is no intention on the part of the Liberals to force a moderate manifesto on the Labour Party at the next General Election. The right hon. Gentleman the Leader of the Liberal Party has acknowledged that, saying: The terms have been agreed to work together, and we have both retained the total independence of our parties from each other in electoral terms and in terms of the House of Commons. The Prime Minister, in effect, said the same at Aberystwyth on 2nd July when he said: I ask the whole movement to unite behind its Labour Government in laying the ground work for the electoral gains which will give Labour a working majority next time. Again, the right hon. Gentleman the Leader of the Liberal Party originally claimed that the pact will get the country through the difficult period ahead, especially the pay negotiations." —[Official Report, 23rd March 1977, Vol. 928, c. 1315–19.] It has not even done that. The right hon. Gentleman may now care to remember that, if there had been a Conservative Government following an April General Election, not only would they have had the authority in coping with the problems of pay stemming from a large majority and massive public support but also would, no doubt, have already set about making reductions in direct taxation, which is one of the first priorities of the next Conservative Government. That alone could by now be acting as an incentive to increase output and moderate wage claims.

Therefore, to my mind, the justifications of the pact are thoroughly spurious and its continuing existence is a nonsense and a contradiction. It will not produce stability it does not control Socialism, and it has not got the country through the pay negotiations—somehing which even this Government would have wanted, with or without the Lib-Lab pact.

There is no doubt, therefore, who has lost as a result of the pact—the British people. Equally, there is no doubt who has gained—the Prime Minister, who has been able to stay a few more months in Downing Street hoping that something will turn up. But, as David Wood pointed out today in The Times: The advantages to the Government are no more than a temporary salvation from a parliamentary crisis. Nothing has turned up and within the period of this Parliament nothing will. The jam tomorrow gets further away, as the Prime Minister emphasised at Aberystwith, when he said: In another five years, we shall be gaining major benefits from our industrial strategy … We want to plan now for the Britain of the 1980s. What about the Utopia which we were told would arrive in the later years of this Socialist Government?

Nevertheless, it is nice to hear that new-found realism by the Prime Minister in place of the former unclouded optimism. Perhaps such becoming modesty should reap its own reward, but it does not. So whenever any part of it has had the opportunity, the electorate has shown its clear opinion that it is time for a change: Woolwich, Workington, Walsall, Stechford, Grimsby, Ashfield and now Saffron Walden, every one a knock-out victory for the Conservative Party and every one a shattering blow to Labour and the Liberals.

Yet I am told that Saffron Walden is considered by some Liberals as a victory —a Pyrrhic victory, I assume. They should remember what King Pyrrhus said: Another such victory, and we are lost. If the Saffron Walden victory were repeated in all Liberal seats, the casualty list, based on the Liberal Party's own assessment of the swing from them to the Conservatives, would read as follows: the hon. Members for Berwick-upon-Tweed (Mr. Beith), Truro (Mr. Penhaligon), Isle of Wight (Mr. Ross), Isle of Ely (Mr. Freud) and Cornwall, North (Mr. Pardoe), the right hon. Member for Devon, North (Mr. Thorpe), the right hon. Member for Roxburgh, Selkirk and Peebles (Mr. Steel) and the hon. and learned Member for Montgomery (Mr. Hooson).

Mr. David Penhaligon (Truro)

Might not another interpretation of Saffron Walden be that, at this great high point in the Conservative advance, 25,000 people chose to vote for them but 43,000 chose not to? With that in mind, should one not regard the possibilities as still open?

Mr. Morrison

In fact the Conservative vote went up. I have no doubt that Conservative voters were so confident of victory that they did not think it was necessary to bother too much.

All that would be left after that casualty list is a five-a-side football team—provided, of course, that the SNP did not gobble up the hon. Member for Inverness (Mr. Johnston). It would be better if the Liberals had an election now, since otherwise before long there may not be enough of them for a game of patience.

No wonder the hon. Member for Rochdale (Mr. Smith) wrote in Liberal News on 5th July: David Steel is wrongly motivated. He desperately believes in coalition as a method of government. I think it should only be used when all the partners to a coalition have enough Members to back up their position. And 13 Members is a ridiculous number for us to be talking about a coalition. Ridiculous, yes—and destructive, too.

But if there has been one good thing about the past few months it is that the Liberal Leader has realised that, as things get worse and worse for the Government and as their days are more and more numbered, it is more important for him to discover what the Conservative Party stands for. Clearly, he has been reading "The Right Approach". As he has read it, so he has clearly become ever more attracted by it. So much so that he has included huge chunks of it in his ten commandments.

First, tax reforms aid cuts are on page 42 and elsewhere. Second, employee profit-sharing is referred to on page 29 and elsewhere. Third, help for small businesses and self-employed is on page 35 and elsewhere. The fourth commandment relates to the Official Secrets Act and I grant that "The Right Approach" makes no mention of that, but it is our policy—this has been confirmed for me —to amend that legislation, and the Government have been pressed to act in the light of the recommendations of the Franks Committee.

Fifth, housing grants for first-time buyers and rent de-restriction are on page 50 and thereafter. Sixth, reduction of the Civil Service bureaucracy is referred to on page 23 and elsewhere. Seventh, reduced unemployment, especially among the young, is a major theme of Chapters 4, 5, 6 and 7.

I am sorry to say that we seem to miss out on the eighth commandment about strengthening the powers of the Monopolies Commission. However, our policy was explained clearly on 21st June by my hon. Friend the Member for Gloucester (Mrs. Oppenheim): the Monopolies Commission should be reinforced and strengthened".—[Official Report, 21st June 1977; Vol. 933, c. 1107.] That seems not to be in discord with the Liberal view.

Ninth, an Assembly for Scotland is dealt with on page 49. I grant that we do not commit ourselves to an Assembly in Wales, but few seem to want that anyway and perhaps the right hon. Gentleman the Leader of the Liberal Party has not taken that on board yet. Tenth, direct elections are on page 68—and, yes, with proportional representation if 1 have my way.

It is a pity that the right hon. Gentleman did not read "The Right Approach" sooner. He might have discovered how much he agreed with Conservative policy so much earlier. He might have decided to force an election immediately, in which case he would have done the country a service and would have lost many fewer seats for his party. Instead, he remains glued to the Labour Party, which, whatever its stance may be now, since 1974 has pushed this country further to the Left than any Government in history. What is more, this Government have a future based on Labour's programme for 1976.

How does the Leader of the Liberal Party believe that his ten commandments can be reconciled in any lasting manner with Labour's programme to bring in more income tax, to undertake a major expansion of public ownership or vastly to increase bureaucracy as a result of the tangle of new powers and boards proposed, or to cut mortgage tax relief? Those are but part of the policy objectives of the party that the Liberals are now keeping in power.

In the foreword to that programme, Mr. Ron Hayward, the General Secretary of the Labour Party, wrote: Labour's programme as approved by the Conference is the policy of the Labour Party … It describes not only the ideals of our Party, but also the policies to make them a reality". I grant that he also said that the programme was not a manifesto, but he emphasised that it was on the basis of that programme that the Labour manifesto would be drawn up.

Who would deny that likelihood when comparing that manifesto with some of the more immoderate comments by Labour Members below the Gangway? The Prime Minister may play down the programme, but no one should forget that, with Labour constituency parties going further and further to the Left, and therefore with many moderate Labour Members under fire and others being replaced by extremists when they retire the threat of that programme is ever more real. It is time for the Liberal Party to cry "Enough".

As I have said, I am in favour of constitutional change and if this House is to order the government of our country in future with more success, it is high time we set about making constitutional change. But the Liberals' experiment has failed because it was based on unreal and weak foundations. Let them stop it now. If they do not, the millstone of this Labour Government will drown them as much as it sinks itself and in the meanwhile they will be doing the country a gross disservice.

4.19 p.m.

Mr. Emlyn Hooson (Montgomery)

The trouble with the hon. Member for Devizes (Mr. Morrison) is that he is so moderate that he was unable to move the motion standing in his name with any conviction. In fact, if there were many more like him in the Conservative Party it would be easier for the Liberals to contemplate an agreement with the Conservatives. The hon. Gentle- man is so naive that he actually believes that the Tories would proceed to implement what is set out in "The Right Approach".

I commiserated with the hon. Gentleman when he confessed that, although he has been in the House for 13 years, this is the first time that he has ever been successful in the Ballot for motions. I was able to commiserate with the hon. Gentleman because I have been in the House for 15 years and have never succeeded in the Ballot.

Mr. Adley

The hon. and learned Gentleman will not have much longer here.

Mr. Hooson

That is what the Tories have been saying for the past 14 years. However, if I were to achieve success in the Ballot I should not waste my motion on the Tory Party. Members of the Tory Party have been in the starting blocks for the election now for so long that their tendons have become weakened. If the gun is fired they will go limping along the track. We are seeing a series of Achilles heels which I will point out by reference to "The Right Approach".

Implied in the motion is the belief that a Conservative Government can be relied upon to implement polices set out in their manifesto and not to carry out diametrically opposite policies. In my formative years when I was 18 and had just entered the Navy, a young Communist came to me and gave me a book called "The Constitution of the Soviet Union". I read the book and was tremendously impressed. It seemed to me to depict the ideal democracy. Yet, as every one of us knows, in fact as opposed to theory, nothing could be further from the truth. Conservative policies are very like that.

Great play has been made of "The Right Approach" and the policies set out therein. I read the document with great interest but was unable to find any policies in it. There are a series of interesting clichés. I remember the story of Ernie Bevin at the Dispatch Box saying to his Prime Minister Attlee about a speech by Anthony Eden "There is not much in there, Clem, but cliché after cliché"—or, as he put it, "clitch after ditch". It is exactly the same with "The Right Approach".

What I did, as hon. Members would expect, was to get the Conservative manifesto for 1970—"A Better Tomorrow" —and compare the theory with the practice.

Mr. Adley

Before the hon. and learned Gentleman comes on to that—

Mr. Hooson

The hon. Gentleman must not disturb me. He has been in the starting blocks for too long. He must not get too anxious.

Mr. Adley

So the hon. and learned Gentleman will not give way?

Mr. Hooson


Mr. Adley


Mr. Hooson

Not at all. It is very interesting to compare what was said in 1970 with what is said in 1977. The two documents have amazing resemblances. What was said in 1970 was not carried out, as I shall show later.

I looked at "A Better Tomorrow", first at the section dealing with the control of public expenditure. We all know that this is very important to the Conservatives when they are in Opposition. There is nothing that they like to emphasise more, and "The Right Approach" does not depart from the tradition. The hon. Member for Devizes referred to certain pages in "The Right Approach". Let me refer him to page 24 where it says: public spending cuts are essential if we are to bring the economy back into balance". That is what is said in 1977. So I look to see what the Conservatives said in 1970. At page 10 of "A Better Tomorrow" the Conservatives said—

Mr. Fergus Montgomery (Altrincham and Sale)


Mr. Hooson

The hon. Gentleman must not be jealous—he will learn in good time. The Conservatives said in "A Better Tomorrow", under the heading "Controlling Government Spending", We will reduce the number of Ministers. We will reduce the number of civil servants: under Labour their numbers have grown by over 60,000. So I looked at the statistics to discover what had actually happened. Between 1970 and 1974, the period of the Conservative Government, there was an increase in central Government employees of 209,000, not 60,000 as it had been under the Labour Government. The theory was one thing, but the practice was to exaggerate what the Labour Government had done.

It was said in 1970, for example, Some present government activities could be better organised using competent managers recruited from industry and commerce. Plans to achieve this new style of government are well advanced. It would be more efficient and less costly.

Mr. Norman Tebbit (Chingford)

What has this to do with the motion?

Mr. Hooson

The hon. Gentleman is never able to follow these debates properly. If I had to explain the matter at his low level it would take me the remaining part of this debate.

The number of local authority employees increased in the period by 285,000. Yet in their policy document the Conservatives had indicated that he number of public servants would be reduced, that there would be a tremendous cut in costs.

Mr. Tebbit

On a point of order, Mr. Deputy Speaker. This is a short debate. It might be useful if you would ask hon. Members to confine their remarks to the Lib-Lab Pact and the new-found acceptance by the Leader of the Liberal Party of so many of the policies set out in 'The Right Approach'. After six minutes of the speech of the hon. and learned Member for Montgomery (Mr. Hooson) we have not reached any of those matters.

Mr. Deputy Speaker (Mr. Bryant God-man Irvine)

I have been looking at exactly the same words in the motion and I have no doubt that the hon. and learned Gentleman is also doing so.

Mr. Hooson

I am talking about "The Right Approach" and asking what reliance can be placed upon the alleged policies therein set out.

Mr. Ioan Evans (Aberdare)

Further to that point of order, Mr. Deputy Speaker. As some of us will, perhaps, be making similar points to those that the hon. and learned Member for Montgomery (Mr. Hooson) is making, may I put it to you that he is arguing that no one should trust what the Tory Party puts into its manifestos. He is comparing what they said in their manifesto for the 1970 election and what transpired after 1970. Surely the hon. and learned Gentleman is perfectly in order to draw attention to the Tories' past record to determine what they are likely to do in the future.

Mr. Deputy Speaker

I have not indicated anything to the contrary.

Mr. Hooson

So I understood, Mr. Deputy Speaker. As the Conservatives said in their election manifesto in 1970 that they would cut down on public sector expenditure and as they repeat it in "The Right Approach", it is very interesting to see what they actually did when they were in Government. In 1970 the total public expenditure was £21,866 million, yet by 1974 when the Tories left office it was £41,930 million.

Mr. Timothy Raison (Aylesbury)

In real terms?

Mr. Hooson

I will state it in percentage terms. There was a 91.8 per cent. increase in public expenditure between 1970 and 1974, including debt interest. Excluding debt interest, the increase was 93.2 per cent. Is the hon. Gentleman suggesting that under the Tory Government inflation was 93 per cent. in that period? What the Tories did in fact was to fuel the fires of inflation.

Mr. Raison

We all recognise that public expenditure went up under the last Conservative Government, but it did so with the active encouragement of the Liberal Party. For example, in his speech in the 1973 Budget debate, the hon. Member for Cornwall, North (Mr. Pardoe), who lectures our Front Bench these days about the fact that money supply was a little lax during that time, warned the then Chancellor, the present Lord Barber, I fear that the Chancellor is already giving signs that he may yield to the conservative and over-cautious voices behind him."—[Official Report, 12th March 1973; Vol. 852, c. 953.] He was talking about hon. Members such as my hon. Friends the Members for Oswestry (Mr. Biffen) and Cirencester and Tewkesbury (Mr. Ridley), who were saying that there should not be an increase in public expenditure or in the money supply. The hon. Member for Cornwall, North was saying that the Government should be spending more.

Mr. Hooson

The Conservative Government increased public expenditure enormously between 1970 and 1974 and they financed it by increasing the money supply.

Let us consider what the Conservatives call in "The Right Approach" the main aims of their political strategy. They are: To enable the country to live within its means, through the reduction and control of public expenditure and the rebuilding of a healthy and thriving mixed economy in which taxes can be lower and profits can fulfil their proper function. Those aims are unexceptionable, but the Conservatives set out the same aims in 1970 and totally failed to achieve them. They never lived within their means. There was a surplus on the books when they took office. Mr. Roy Jenkins was the last Chancellor of the Exchequer to balance the books, and they were not balanced in any year of that Conservative Government's period of office.

They talk now about profits fulfilling their proper function, but when they were last in power the profits made by industry were not channelled into investment. We had the great property speculation and much of the money that should have been invested in structural changes in our industry were squandered. What the Conservatives say and what they do are two entirely different things.

Mr. Penhaligon

I think that my hon. and learned Friend is being a little unfair to the Conservative Party. The Tories promised to reorganise local government, health authorities and water authorities and, if my recollection is correct, they did so.

Mr. Hooson

My hon. Friend is right. I have been depriving the right hon. Member for Leeds, North, East (Sir K. Joseph) of the credit for reforming the National Health Service. He was and is a great apostle of economy and nowadays he goes around in sackcloth and ashes for what he did between 1970 and 1974—but a leopard does not change its spots.

Under the right hon. Gentleman, expenditure on the National Health Service, as a percentage of our gross national product, increased from 4.6 per cent. in 1970 to 5.2 per cent. in 1974 and expenditure on administration within the Service went up from about 23 per cent. to 27 per cent. of total spending. That represents about 1 per cent. increase a year. Those are enormous sums. We have had to cut down on public expenditure recently because so much of it was misdirected under the last Conservative Government into increased bureaucracy in local government, the NHS and the Civil Service generally.

Mr. Nicholas Fairbairn (Kinross and West Perthshire)

II the hon. and learned Gentleman thought that the last Conservative Government were so bad, why did he not suggest that electors should vote Labour rather than Liberal in the 1974 General Elections, and if he thinks that the Labour Party is so good, why did his party not form this funny pact as soon as Labour got into office?

Mr. Hooson

I have not yet said a word about the Government.

Mr. Adley

The hon. and learned Gentleman has not yet said a word about the motion.

Mr. Hooson

I have said a great deal about the motion—and I have hardly started yet. This is the introductory part of my speech.

We look at manifestos to see what a party is going to do if it becomes the Government. We all remember the tremendous adherence of the right hon. Member for Sidcup (Mr. Heath) to his incomes policy, but his 1970 manifesto A Better Tomorrow" said: Labour's compulsory wage control was a failure and we will not repeat it. But that is exactly what they did.

Mr. Tebbit

And it was a failure, was it not?

Mr. Hooson

Yes, it was a failure. The whole Government were a failure.

Mr. Raison

The hon. and learned Gentleman has reached an important point. The Liberal manifesto in October 1974 said: a statutory prices and incomes policy is absolutely necessary as an essential weapon against inflation. Will the hon. and learned Gentleman give a categorical assurance that his party will stand by that during the next few weeks?

Mr. Hooson

If the hon. Gentleman's party and the Labour Party had backed an incomes policy in the 1960s and under the last Conservative Government, this country would not be suffering from the galloping inflation that we are now experiencing.

Mr. Tebbit

Answer the question.

Mr. Hooson

The truth is that the last Conservative Government—

Mr. Deputy Speaker

Order. If there were a little more quiet, I might be able to hear truth when it is promulgated.

Mr. Hooson

I am sorry that you missed it, Mr. Deputy Speaker. Do you want me to start again?

Mr. Fairbairn

Yes, from the beginning, and get it right this time.

Mr. Hooson

I should not get it right in the terms of the hon. and learned Member for Kinross and West Perthshire (Mr. Fairbairn)—thank God!

The 1976 "Economic Trends" includes a table showing the increase in money stock—M3—under the last Conservative Government. The Tories make a good deal of the need to control the money supply, but in 1970, when they came into power, M3 increased by £1,586 million. In 1973, it increased by £7,232 million. This enormous increase in the money supply was one of the major causes of inflation in this country.

I hope that you will agree, Mr. Deputy Speaker, that by comparing "A Better Tomorrow" with the record of the last Conservative Government I have put their latest manifesto "The Right Approach" in the correct perspective. It is a propaganda exercise that is intended to appeal to the electorate but not to bind the next Conservative Government in any way.

I come to that part of the motion which states That this House welcomes the new-found acceptance by the Leader of the Liberal Party of so many of the policies set out in 'The Rieht Approach '. Seven out of 10 points in the so-called shopping list can be found in the Liberal manifesto of 1970, "What a Life". The title "What a Life" was correct, because the Conservative Government followed us, and look what happened then! That Government took the country to the brink of disaster.

Mr. Toby Jessel (Twickenham)

When the Conservative Government to whom the right hon. and learned Gentleman refers were in office, the real standard of living of the British people improved by 10 per cent. in three and a half years, but in the last three and a half years of the Labour Government, which he supports, the real living standards of the British people have been stationary.

Mr. Hooson

What the hon. Gentleman says is untrue. The last Conservative Government left this country heavily in debt and with galloping inflation. However, the present Labour Government behaved very badly in their first two years of office, when there was little to choose between the red devils of the Labour Party and the deep blue sea of the Conservative Party. That posed a dilemma for my right hon. Friend the Leader of the Liberal Party. He was prepared, in the interests of the country, to support a Government that had a chance of implementing moderate policies and achieving some continuity.

The Conservative Opposition have failed to recognise a very important point that was stated by the right hon. Member for Down, South (Mr. Powell), who has more experience of the Conservative Party than anyone on the Opposition Benches today. The right hon. Gentleman stated—I think correctly—that no recent Government have brought about greater control of public expenditure than the present Government in the last one and a half years. That is true. We all know that the number of civil servants and local government officials has dropped. This does not justify many of the policies carried out by the Government in their first two years of office, but it shows that they have changed their ways somewhat.

We in the Liberal Party came to the conclusion that it was in the interests of the country to allow the Government the opportunity—

Mr. Leon Brittan (Cleveland and Whitby)

Of redeeming themselves.

Mr. Hooson

Yes—of redeeming themselves. Sometimes I think that there is hope for the hon. Member for Cleveland and Whitby (Mr. Brittan). He is absolutely right.

In The Times of Monday 21st November this year. [HON. MEMBERS: "This year?"]. I should have said 21st March this year. If the mistakes of members of the Conservative Party were as elementary as that, I could forgive them.

In The Times, it was stated: But there is much to be said, if it can be obtained, for an arrangement that would permit the present Government to remain in office for a bit while ensuring that there would be no more extremist measures. That would be preferable in the national interest to an immediate election at this time. But it does depend on an effective assurance from the Government on the moderation of their ways. In fact, The Times repeated this advice in a leading article on 23rd March and The Sunday Times stated on 19th March: This is not the moment for a General Election. But it is a salutary moment for a jolt to the Labour Government. The Daily Mirror stated on 22nd March: Parliament is gripped by … election fever … The biggest loser from an election now would be Britain. … An election would cause uncertainty. Undermine economic recovery. Imperil the pound. The Opposition parties should take a hint from the City of London where shares crashed by £1,000 million yesterday at the talk of an election.

Mr. Charles Morrison

As the hon. and learned Gentleman has been quoting from leading articles, will he refer to a leading article in The Times on 16th June, which, under the heading The case for an autumn election", stated: Small wonder after all the embarrassments that the Liberals have suffered and the ineffective operation of the pact that unless the Government pull themselves together there may have to be an election in the autumn. There is now a strong case in the national interest for having it then."?

Mr. Hooson

Judging from the hon. Gentleman's hesitation in reading the quotation, the printing seems to be as bad as the opinions. If the hon. Gentleman is making an application we shall consider it.

The Liberal Party believes that the moderate centre of British political life should have been strengthened [HON. MEMBERS: "Join the Tribune Group."] The Tribune Group has less influence over the Labour Government's policies than it has ever had in this Parliament. When my party had to choose between the ideologues below the Gangway on the Labour side of the House and the gamblers who gambled with the economic life of this country between 1970 and 1974, it was a very difficult choice to make. I preferred to go to a Government prepared to moderate their policies.

I am prepared, as a Liberal, to make an arrangement if necessary with the Conservatives. I have never had any other view. I am prepared to moderate any Government to prevent the Right-wing lunatics getting hold of the Conservative Party, just as I am prepared to prevent the Left-wing lunatics getting hold of the Labour Party. I imagine that the hon. Member for Devizes would not greatly disagree with me on that point. We both want to improve the political weighting of the centre in British political life.

The majority of people in this country want a moderate progressive Government. They do not want violent swings to the Left and Right. It was in the interests of the country that the Liberal Party should not be afraid to touch power and should not be afraid of this great experiment of moderating a Government to whom they were offering their support on an agreed programme. If Conservative Members cared about this country, they would be prepared to do the same, rather than pursue the partisan policies that in fact they pursue. The Conservative Party puts forward this mythological programme "The Right Approach", but we know from the Conservatives' record that they would never begin to achieve it.

This country is in an economic strait-jacket—

Mr. Tebbit

We knew that.

Mr. Hooson

Sometimes I wish that the hon. Member for Chingford (Mr. Tebbit) was in a straitjacket too.

My right hon. Friend the Leader of the Liberal Party has followed the policies that he recently suggested to the Prime Minister for years. There is nothing new in them. There is no "new-found acceptance" by my right hon. Friend. Many of these policies were in the Liberal manifesto in 1970 and only now have a few been adopted in "The Right Approach". That is the trouble with the Conservative Party—they are almost always seven years out of date.

4.49 p.m.

Mr. Michael Stewart (Fulham)

The concluding words of the motion deplore the refusal of the Leader of the Liberal Party to take the political action that would secure the implementation of the policies set out in "The Right Approach". I do not think that I misinterpret what the hon. Member for Devizes (Mr. Morrison) said when I point out that the action that he wants taken is the action of the Liberal Party mobilising itself to bring about the defeat of the Government, a General Election, and, as the hon. Gentleman would hope, the installation of the Tory Party in power. But, as the hon. and learned Member for Montgomery (Mr. Hooson) said, it is open to question whether the return of the Conservative Party would cause the policies set out in "The Right Approach" to be put into force. The record of comparison between what the Conservatives said that they would do and what in fact happened does not give us great confidence.

Surely one of the matters we are bound to discuss on this motion is whether it would be a public advantage for the Liberal Party, or indeed anyone else, to take action which might result in the return of the Tory Party. In order to answer that question, let us consider the present situation.

The Labour Government came to power at a time of enormous economic difficulty. Many of those difficulties still persist throughout the world. But increasingly the evidence mounts that events are beginning to move in the right direction.

Inflation is substantially more under control than it was when the Government took office. The prospects for our export trade are substantially better. The outlook for investment is substantially better. These opinions are expressed not only by people in this country but, as we have witnessed recently, by a number of well-informed international authorities.

Mr. Adley rose

Mr. Stewart

I do not propose to give way. This is a short debate and we have already had a lot of cross-talk.

The question which causes great anxiety in our domestic politics is what is to happen about prices and incomes policy. If one is anxious about that, could any course of action be more imprudent than to entrust the conduct of our affairs to the Conservative Party when we remember that the last Conservative Government collapsed on this very point—their inability to establish a satisfactory relationship with organised labour or to find an answer to the problem of the level of incomes or the control of prices? On the evidence, then, there does not appear to be any special ground for supposing that turning the Government out and putting the Conservative Party in would be a public advantage.

However, I also urge this argument. The Conservative Party needs a bit more time to find out what its policies are. Some of them are set out in "The Right Approach", but other bits are shot at us across the Floor of the House week after week. We are told the things that it believes in. They add up to a very puzzling collection.

For example, we know from some Opposition Front Bench spokesmen that the Conservative Party, if it took office, would spend more money on defence. We know that it would abolish the rating system. Therefore, presumably, local authorities would have to obtain funds from some other source. But we know also that it would abolish the Community Land Act, which would be a valuable source of income to local authorities. Therefore, presumably, it would have to provide local authorities with more central Government funds.

All this—more grants to local authorities instead of rates and the Community Land Act, more money to be spent on defence and, as we have just been told, really wealthy people to pay substantially less in taxes—

Mr. Raison

May I help the right hon. Gentleman? According to the public expenditure White Paper, a public expenditure deficit would be incurred under the Community Land Act. There would be a loss to Government for the quinquennium as a result of the working of the Act.

Mr. Stewart

The hon. Gentleman must know that an Act of that kind is an investment for the future. The Community Land Act will put into the public purse unearned gains that now go to private people. That is mainly why Conservatives object to it. That is the reason for their wanting to get rid of it.

When we add up all these considerations—more money on defence, more grants for local authorities instead of rates, and reduced taxation for really wealthy people—we realise that the Tory Party needs longer to work out the sums and to decide exactly how to make ends meet.

We know how the Conservative Party did it in the past. It did not have the nerve to cut public expenditure or to raise the necessary taxation. It did it by having recourse to the printing press. In view of what the Conservatives are now saying about reduced taxation in one direction and increased expenditure in another, if the country were to allow them to come to power now they would be faced with the same dilemma.

The Conservatives need to do a bit of adding up not only on financial matters. There is reference in "The Right Approach" to an Assembly for Scotland, but, after the long debates on the devolution Bill, can anyone say exactly what the Conservative Party proposes or what would be the powers of such an Assembly? I gather that it is to be an Assembly without an Executive, and I have never understood the point of that. The Conservatives must have a bit more time before they can pronounce on devolution, just as they must have more time before they can say how they will make the public accounts add up.

This country, though not the imperial Power it once was, still carries considerable responsibility abroad. Not long ago we had a debate late at night, which was not very well attended, on a sanctions order for Rhodesia. The extreme wild men of the Conservative Party voted against the order for the perfectly good reason that they sympathised with the Ian Smith Government. Naturally, the respectable remaining Members of the Conservative Party would not go as far as that. However, when it came to a Division between the Government and those who wanted the order and the wild men of the Tory Party, the respectable Tories remained seated on the Opposition Benches and did not vote.

I cannot feel that that is an attitude suitable to a party which claims to be fit to wield power. We must give it a little more time. While speaking of African matters, let me say that one of the outstanding special characteristics of the 1970 Tory Government was that one of their first actions was to announce that they would sell arms to South Africa. What is their view on that subject now? They have been rather silent about it. I do not think that the Liberal Party, or indeed anyone else, should take action which would face the country with the possibility of bringing the Conservative Party to power until we know what it thinks on that subject.

There are wider questions of foreign policy. One gained the impression from speeches and questions of the right hon. Lady the Leader of the Opposition that she had a very poor opinion of the Helsinki Agreement. If the Conservative Party were in power now, would it have sent representatives to the Belgrade conference? Would it have taken a line in foreign policy different from that of all our partners in the EEC and all our allies? To judge from the speeches and questions of the Leader of the Opposition, presumably it would. But the Conservatives did not make it clear if faced with the responsibility what they would do on a great matter of that kind. They must, therefore, have a little more time to think.

One knows that this motion is tied up with a campaign run in certain quarters of the Press which are trying to argue that the Government are under a sort of moral duty to call a General Election now. That, of course, is nonsensical. The constitution is perfectly clear: one has a General Election either when time has run out or when the Prime Minister of the day requests a General Election, or if and when the House of Commons explicitly tells the Government to go.

One does not have a General Election simply because the Government are running through a bad patch. Othewise there would have been a General Election in 1957 or 1958, to the great damage of the Conservative Party. One does not have General Elections because leader writers in The Times think that there ought to be one. When Bagehot wrote he said The Times has made many Ministries Times have changed since then. I doubt whether 10 minutes' vexation is as much as any leader in The Times can cause any Prime Minister today.

However, we are indebted to The Times for another sidelight of what a Conservative Government might be like. We gather from an article in The Times that the Leader of the Opposition is the spiritual heir to Adam Smith, John Stuart Mill, Martin Luther, the Christian religion and Oliver Cromwell. We ought to know a little more to which her allegiance is primarily given before she and her party are put at the helm of affairs.

I regard the reference to Cromwell as peculiarly sinister when we remember the scene in the House a few days ago when the Leader of the Opposition was demanding of the Prime Minister that he should make an emphatic and solemn repudiation of one of his hon. Friends who happened to use the phrase "civil war". Does the heir to Oliver Cromwell now complain about civil war? He was the greatest practitioner.

The plain fact is that this attempt to present, both in this motion and in other contexts, an incoming Tory Government as the saviour of all that is best and noblest in British tradition is absolute nonsense. There is nothing whatever, either in their philosophy or in their record. to justify that.

It is no part of my duty to claim that this Government are perfect in all respects. I have been in politics long enough to know that one cannot claim that of any Government. But heaven help us if we are ready to hand over our affairs to a party whose main characteristic in home affairs is the daily quarrel with organised labour, which arranges its financial affairs mainly in the interests of sections of the community that are already well off and unproductive, and whose attitude towards foreign affairs is unpleasantly tinged with racialism and extremely muddled about the great question of our relations with the Communist part of the world.

A situation of that kind has only to be stated to be rejected. I do not pretend that we possess all the virtues, but I should have thought that when we have a Government who are, as the evidence shows, making progress with our enormous economic difficulties and who work well with our friends and allies in world affairs, it is a reasonable and right choice for the Liberal Party to help sustain that Government in power.

5.4 p.m.

Mr. Fergus Montgomery (Altrincham and Sale)

I found the speech of the right hon. Member for Fulham (Mr. Stewart) rather curious because he seemed to imply that a Conservative Government were not able to work with organised labour. I can only assume that the right hon. Gentleman was referring to the dispute that took place in February 1974 between the then Conservative Government and the miners. I hope that the right hon. Gentleman was not saying that he backed the miners on that occasion. If that is the case, I am curious to know what the right hon. Gentleman's views are now of the demands that the miners are making and the damage that they will do to the social contract. The attitude of his party in 1974 is one of the reasons why people should not vote Labour. It was also wrong of the right hon. Gentleman to allege that a Conservative Government could not work with the unions. The right hon. Gentleman did a great disservice by trying to make that point in this debate.

I congratulate my hon. Friend the Member for Devizes (Mr. Morrison) on initiating this debate. It has given us the opportunity to discuss at some length one of the most squalid manoeuvres that we have ever known in British politics. I do not believe for a moment that this was a shotgun marriage. Usually in a shotgun marriage there is an unwilling bridegroom and a willing bride. In this case we had a willing bridegroom and a willing bride. They were only too eager to come to any sort of arrangement in order to prevent a General Election from taking place.

On the one hand we have a Prime Minister who obviously wants to go on being Prime Minister and who is frightened of a General Election because he knows all too well what the verdict of the people of this country will be on his discredited Government. On the other hand, we have the Leader of the Liberal Party who realises that if we had a General Election at this time it would decimate his already tiny band of Liberal Members of Parliament. I believe that the motive for the Lib-Lab pact was not the well-being of the nation but rather what the hon. and learned Member for Montgomery (Mr. Hooson) was trying to imply, the self-preservation of the Government and the Liberal Party.

The Liberal Party must have already seen what many one-time Liberal voters think about this pact, because there has been a mass desertion of people who previously voted Liberal in by-elections and in the county council elections in May. I have no doubt that the result in Saffron Walden will be heralded by certain Liberals as the new dawn for the Liberal Party.

Mr. Beith

Do not exaggerate.

Mr. Montgomery

Had the hon. Gentleman watched television on Friday he would have seen his hon. Friend the Member for Cornwall, North (Mr. Pardoe), in his capacity as deputy Chancellor of the Exchequer, pontificating that the Saffron Walden result was not a very good result for the Conservative Party. We had the hon. Member for Cornwall, North and the Leader of the Liberal Party almost doing cartwheels of pleasure because the Liberals had managed to come second. That they tried to pretend that the result was not a good result for the Conservative Party shows how deeply their heads are buried in the sand. I do not think that it was a bad achievement for the Conservative Party to increase its vote in Saffron Walden on a smaller poll.

Mr. Beith

Why did they stay at home?

Mr. Montgomery

It may well be that disgruntled Liberals stayed at home or that people were away on holiday.

Mr. Penhaligon

It was disgruntled Liberals.

Mr. Montgomery

The hon. Gentleman said that disgruntled Liberals stayed away, but that is a terrible indictment of the Lib-Lab pact because I have no doubt that that was one of the reasons why those Liberals did not bother to turn out and vote in Saffron Walden.

Mr. Tebbit

Surely the essence is that our vote in Saffron 'Walden went up by 1,000—which is not bad in a by-election —and the Lib-Lab vote fell by 11,000. That cannot be good for Lib, Lab or the pact.

Mr. Montgomery

My hon. Friend is right, as usual. We not only increased our vote but more than doubled the majority. If that had happened to a Liberal candidate I am sure that the hon. Member for Cornwall, North would have hailed it as the greatest thing since sliced bread. But that is never likely to happen to a Liberal candidate in this country in this century.

The truth is that the Liberal Party has so little to cheer about that if its horse came in second in a two-horse race it would regard that as a great triumph.

Mr. Penhaligon

Sutton and Cheam.

Mr. Montgomery

Sutton and Cheam happened a long time ago. I do not know whether the hon. Gentleman is some sort of Rip van Winkle who has been asleep for the past few years. Sutton and Cheam came back to the Conservative Party and we now have a Conservative Member representing Sutton and Cheam.

Mr. Penhaligon

If the hon. Gentleman is arguing that by-election results show that the Government have lost the support of the people, why did the Tory Party not have an election after the Sutton and Cheam, Isle of Ely and Ripon by-elections?

Mr. Montgomery

The point is that at that time the Conservative Government had a majority in Parliament. The difference now is that the Labour Government have not a majority in Parliament. They are a discredited Government who have lost many seats in by-elections.

Mr. Adley

Was it not the fact that at that time the Conservative Government took the much more realistic view that they should go to the country on their incomes policy? The present Government now find that their social contract no longer exists, as has been admitted by the Prime Minister, they have lost their majority in Parliament, but they still refuse a General Election?

Mr. Montgomery

The Lib-Lab Pact came into being on 23rd March this year. Knowing the fanatical desire of the Liberal Party for some form of proportional representation, I was amazed that this was not one of the conditions of the Lib-Lab Pact. It tends to prove that the Liberals wanted the pact even more desperately than the Labour Government. I am a little cynical about the Liberals new-found enthusiasm for proportional representation.

Mr. Beith


Mr. Montgomery

Yes, new-found. It has not been on the go for very long. In the early part of this century, when the Liberals were one of the great parties in this country, the electoral system suited them perfectly, and the people who were squeezed out were members of the fledgling Labour Party, then a new party. The Liberals at that time had no desire to change the electoral system because the first-past-the-post system suited them well. I am not impressed by the arguments now deployed by the Liberals for a change in the electoral system.

Mr. Beith

Since the hon. Gentleman appears to support his hon. Friend the Member for Devizes (Mr. Morrison), does he not appreciate that his hon. Friend is strongly in favour of proportional representation?

Mr. Montgomery

I respect my hon. Friend's views, although I do not happen to agree with him on that point. I am saying that this is something the Liberals have dreamed up because they find that the system does not work as well as they expected. But the system suited them at the time. They had the power to change it, if they had wished, but they did nothing about it.

Mr. Hooson rose

Mr. Montgomery

I have already given way a great deal.

Mr. Hooson

I gave way a great deal, too.

Mr. Montgomery

I agree that the hon. and learned Gentleman gave way in his speech. I hope that he will re-read his speech tomorrow in Hansard, if he can bear it.

What benefits accrue to the Liberals from the Lib-Lab Pact? I suggest very few—apart from the fact that there are still 13 Liberal Members, whereas a General Election in the spring, at the time of the pact, would have all but obliterated them. My hon. Friend the Member for Devizes read out a list of the Liberals who would have disappeared if we had had a General Election earlier this year.

Mr. Charles Morrison

Let me correct my hon. Friend. I was suggesting what would happen if we had a General Election based on the Saffron Walden result, in which the Liberals claim to have done very well.

Mr. Montgomery

It boils down to the same thing—namely, that a large number of Liberals would have disappeared.

What about the legislation enacted by this Government which was bitterly opposed by the Liberal Party at the time? There was, for example, the Community Land Act.

Mr. Beith

Will the Tories repeal it?

Mr. Montgomery

Yes, we shall.

Then there was the Aircraft and Shipbuilding Industries Act and the Act to remove the penalties on the Clay Cross councillors—legislation about which Liberals felt strongly at the time. Was there any move to amend or repeal any of that legislation when the pact was being drawn up between the Liberal Leader and the Prime Minister? Certainly at the time those Acts were going through Parliament they were regarded as anathema to the Liberal conscience—or could it be that there is no longer a Liberal conscience and that self-preservation is the name of the game'?

What makes this pact even more suspect is the list of proposals put by the Liberal Leader to the Prime Minister at the end of June. So many of these proposals are so similar to Conservative policy that one suspects that the Liberal Leader must be suffering a terrible confusion of the mind.

Let me cite a few of the proposals. First, there was the request for tax reforms, with cuts in income tax and a switch to indirect taxation. That pro- posal was very much in line with Conservative policy. Then there were the proposals on housing, with Liberal demands for the reform of the Rent Acts, the derestriction of furnished property and grants for first-time house purchasers. That again was very much in line with Conservative policy.

There was also the Liberal insistence on no more defence cuts and no more nationalisation. That will bring no joy to Labour Left-wingers. The report in today's Daily Telegraph shows how far in terms of defence cuts are the Liberals from certain members of the National Executive of the Labour Party. The Liberal plea for no more defence cuts has fallen on deaf ears because an influential committee of the Labour Party advocates that defence costs could be cut by 28 per cent.—and this despite the fact that many people feel that expenditure on defence has already been cut to a dangerous level.

Perhaps the Liberal's main hopes are that the Government will ensure that direct elections to the European Parliament will take place. The Prime Minister has already promised to use his best endeavours—and we all know what that means. He seems to use his best endeavours on every issue that arises. Last week the Prime Minister nut the survival of his Government above all else, and we saw the doctrine of collective Cabinet irresponsibility. On a Government Bill, on which the Liberal Party felt particularly strongly, we saw six Cabinet Ministers being allowed by the Prime Minister to vote against their Government. Obviously, the Prime Minister's best endeavours did not cut much ice with his six Cabinet colleagues—or perhaps the six rebel Cabinet Ministers are not so naive as is the Leader of the Liberal Party. Perhaps "naive" is the best word to use to describe the Liberal Leader. He seems to be unaware that the Labour Party will keep the pact going for as long as it suits it, and when it ceases to suit Labour, the Liberals will be dropped.

I cannot believe that if the Liberals had been led by either the right hon. Member for Orkney and Shetland (Mr. Grimond) or the right hon. Member for Devon, North (Mr. Thorpe) this pact would ever have seen the light of day. The present Leader of the Liberal Party when he took over was hailed as the new saviour of the Liberals. Instead, he has betrayed them.

In my constituency there is a substantial Liberal vote—or there was. In the General Election in February 1974 the Liberal candidate took second place. In October 1974 the Liberal candidate dropped to third place. Following the county council elections of May 1973 there were two Liberals, one Labour and one Conservative on the Greater Manchester Council. Following the elections in May this year there are now four Conservatives. Having canvassed in the area, I recognise the danger signals for the Liberal Party. People told me on their doorsteps that they did not support the Liberals any more because they regarded a vote for a Liberal as a vote to keep the Socialist Government in power.

I believe that the pact has delayed a General Election. A discredited Socialist Government has been maintained in power, and the Liberal Party has a great deal to answer for. When the General Election takes place, as soon it must, I hope that the electors will give their verdict on the people who have damaged the cause of liberalism. The Liberals have kept this Government in power for much longer than would otherwise have been the case.

5.19 p.m.

Mr. Ioan Evans (Aberdare)

The purpose of the motion introduced by the hon. Member for Devizes (Mr. Morrison) was presumably to try to woo the Liberals—in other words, to encourage them to turn to the Tory Party. In these circumstances perhaps I should not intervene in this debate. Perhaps my right hon. Friend the Member for Fulham (Mr. Stewart), who made an excellent contribution to the debate, and I should just stand back and allow the Tory onslaught on the Liberals to take place in an untramelled way. We have today seen a concerted Conservative attack en the Liberal Party.

Apparently the hon. Member for Devizes does not disagree with pacts. He thinks that political pacts could be a good thing. Apparently he is against the thought of the Liberals having a pact with a party other than the Conservative Party. Of course, the Conservatives cannot be critical of pacts. We all know what happened in 1974. The then Leader of the Conservative Party, the right hon. Member for Sidcup (Mr. Heath), was seeking a pact with the Liberals. Presumably the Conservatives are not against pacts in theory. If we are to talk about theoretical pacts, is there any greater merit in having a pact immediately following an election in which one's party has been defeated?

Conservative Members might think that there was virtue in the right hon. Member for Sidcup going to the country in 1974. What were the circumstances? The country was on the verge of collapse. We were approaching the most difficult economic situation that the country had ever seen. We were going through a serious economic crisis. The opinion polls encouraged the Conservative Party to go to the country. Conservatives stirred up a campaign against the trade union movement as they thought it would give them a bonus, just as they are stirring up the Grunwick issue. They think that it will be a bonus for them if they do so. In 1974 they stirred up the miners' issue. They seized the opportunity because they thought that it would help them to achieve an increased majority.

What happened in the 1974 election? The Conservative Party was rejected and the Labour Party came into power. But the Conservative Party sought to get a pact to maintain the majority that it had had before the election. The Liberals were not prepared to enter into a pact with the Conservatives, and the Labour Party was called upon to form a government. At that time we were without a majority. We recognised that we had to tackle the serious economic problems that the Tory Party had left behind after their years of power from 1970 to 1974. Therefore, we had to get an increased majority. We went back to the country in October 1974 and we were given an increased majority. We then had an overall majority. When the Labour Party feels that it is in the interests of the country that it should risk being defeated by going to the country, it is prepared to take that course. That is what it did in October 1974.

Mr. Fairbairn

I know that the hon. Gentleman's nationality compels him to run on, but in a passage further back he suggested that Conservative hon. Members have been trying to make something out of the Grunwick dispute. Surely he will remember that the Prime Minister asked politicians not to jump on the bandwaggon. Perhaps it would have been better if today's march had not been led by two Government Whips.

Mr. Evans

The hon. Gentleman talks about bandwaggons. If Opposition hon. Members were not riding into the factory in buses, it might be better for all concerned. It might be better if at least one Conservative hon. Member was not the main political adviser to the owner of the factory. Although it is said that the factory wants to recognise trade unionists and trade unions, the advice of the hon. Member for Hendon, North (Mr. Gorst) to the owner of the factory is not to recognise trade unions. I should welcome a Member of the Opposition Front Bench taking the opportunity on behalf of his party to dissociate itself from the political advice that has been given by the hon. Gentleman. I believe that there is a deliberate attempt by the hon. Gentleman and the various organisations with which he is associated to stir up the Grunwick dispute. If anything serious happens at the factory gates, it will be the hon. Gentleman and those with him who will bear some responsibility for what is happening.

I was saying that in 1974 the Labour Party was returned to power. The question now is whether we should have a General Election.

Mr. Tebbit

What a splendid idea.

Mr. Evans

Last week a motion of censure was tabled by the nationalists. They wanted a General Election. At least, they said that last Monday. I do not know whether they have reviewed their policy since then. The Tories were prepared to go into the nationalist Lobby. Of course, the nationalists believe in independence. They want to break up the United Kingdom, which, apparently, would be against the interests of the Tory Party. But that did not prevent the Tories from following behind the nationalists on a three-line whip, although they are demanding independence.

The Conservative Party wants a General Election and we are in a midterm Parliament. As it is wrong to change horses in mid-stream, it would be wrong now to have a change of Government in a mid-term Parliament. It is no use Opposition hon. Members quoting by-election results. Such results in midterm Parliaments follow a pattern. It is all very well Conservative hon. Members chiding the Liberals about Saffron Walden. The Liberals could have mentioned Orpington and many of the other victories that they have had when a Tory Government have been in office. At the time of the Orpington victory I am sure that it was not said by the Conservative Government "We have lost Orpington so we must have a General Election."

Mr. John Lee (Birmingham, Handsworth)

My memory may be faulty but I do not recollect any decision on the part of the Conservatives to press their leader to resign after the Bromsgrove by-election, which they lost in 1971 with a particularly massive swing.

Mr. Evans

That is so.

In this debate we are talking not about the interest of the country but about the pure political interest, as it sees it, of the Tory Party. However, I think that it is questionable; if there were a General Election in a month's time, I am not sure that a Tory Government would be returned.

Mr. Montgomery

Then let us have an election.

Mr. Evans

The hon. Gentleman knows that the longer we stay in power the less chance his party has of forming another Government. When we came into power we put the situation to the people very clearly. Reference has been made to the Tory and Liberal manifestos but in our October 1974 manifesto we stated: Britain faces its most dangerous crisis since the war. The Labour Party makes no attempt to disguise this. We then said: We want to be frank with you. The regeneration of our economy isn't going to be easy, even with a Labour Government. The next two or three years are going to he difficult for us all. We said that there would be no easy times, and we have not had easy times during the past two or three years. Sacrifices have had to be made by the people. The difference is that we are not running away as the Conservatives ran away in 1974.

Mr. Montgomery

How did we run away?

Mr. Evans

I have already explained to the hon. Gentleman that in 1974 the Conservatives thought that they would win the General Election. The people were not kidded, however, by their anti-trade union campaign. They rejected the way in which they seized upon the miners. The policies of the Tory Party were rejected.

What has happened in the past two or three years? We have called upon the people to make sacrifices but the economic indicators are showing that great improvements have been made.

Mr. Fairbairn

In unemployment?

Mr. Evans

Our reserves have risen to a record level. Confidence in sterling has greatly improved. There were times during the past difficult three years when hardly a week passed without the Leader of the Opposition or a leading Opposition spokesman demanding a statement on sterling. Perhaps they thought that they were helping the situation. That is what happened when sterling was going through a difficult period.

Mr. Fairbairn

It still is.

Mr. Evans

That is the patriotism that we get from Conservative Members. They have not been doing that in recent weeks and months. The situation has greatly improved in that time.

The Government by their policies, have reduced interest rates from 15 per cent. to 8 per cent. That will obviously encourage manufacturing investment. The rate is now lower than when the Conservatives were in power. We have had difficulties in recent years. We have been chided by the Conservative Party. We do not get their spokesman congratulating the Government on having brought down interest rates from 15 per cent. to 8 per cent.

When the Conservative Party was in power, there was confrontation with the trade union movement. We have had increasing co-operation from the trade union movement. Despite, attacks made by the Conservative Party, leaders of major trade unions have been willing to pursue unpopular policies in the interests of the country. They have put the country first. They have told their members to restrain their wage demands.

We have brought about a transformation on the balance of payments. The hon. and learned Member for Montgomery (Mr. Hooson) said that in 1970, when the Labour Party left office, what had previously been a deficit had been turned into a surplus and that, in four years, the Tory Government transformed it back into a severe deficit.

What has happened in the last three or four years? The current account surplus of £126 million has been brought about in the three months to April 1977. That is the first such surplus since early 1972. There are now predictions that, if we keep on course, there will be a substantial surplus in 1978. That will be a great transformation from the situation left by the Tories in 1974.

Mr. Charles Morrison

The hon. Gentleman has listed a number of items that he claims as the achievements of the Labour Government. Personally, I do not agree with his contention that they are achievements. But, assuming that they are, he is able to enumerate those items now only by courtesy of the Lib-Lab Pact. What concession will the Government make to the Liberal Party when we have another election?

Mr. Evans

The hon. Gentleman earlier said that he was not against political pacts. Personally I do not like political pacts. The Tories, in their own party interests want an election now. The hon. Member for Devizes, in his motion, states: That this House welcomes the new-found acceptance by the Leader of the Liberal Party of so many of the policies set out in 'The Right Approach', but deplores his refusal to take the political action to secure their implementation. By that he means implementation of the policies set out in the Tory manifesto. I hardly think that will persuade the Liberals to join the Tories on this issue. Yet that is the argument that they are putting forward.

The Liberals are free agents in this matter. Between now and 1979 there will be a General Election. The Liberals will then no doubt review the situation and decide whether their arrangement with the Labour Party should or should not be continued. They will review the situation at the end of this Session anyway. The hon. Member for Devizes suggests that it is in the interests of the Liberal Party that there be a General Election now. But when he and his colleagues are saying "But of course, if there were an election, there would be fewer Liberal Members", I do not see how that will persuade the Liberal Party to join them in wanting a General Election.

We have made many improvements in three years. It would be wrong to have a General Election now because some of the Government's policies are still working through. There is our policy on North Sea oil and the benefits that will flow from that. As I have said before in the House, the Opposition have not hesitated to try to gain kudos out of the fact that the price of imported oil has gone up by 400 per cent. since the Labour Government have been in power. That has had a serious effect on the balance of payments. However, we have begun to overcome those difficulties. The oil and gas are flowing in from the North Sea. They are publicly-owned assets, and they will bring great benefit to the country. The Opposition want a General Election before the full benefits flow. They are justified in making such a demand because of their party interest.

What is the situation in the country? The hon. and learned Member for Montgomery pointed to the fact that when there was the rumour of a General Election, overnight £1,000 million was written off share prices on the Stock Exchange. Therefore, the City is not too keen to have a Tory Government. That is not because it sees the Labour Party taking a more kind-hearted view of its activities than the Tory Party, but because a General Election would create a politically chaotic situation.

What would happen if there were a General Election now with a similar result to the last one? Presumably, if there is opposition by Tory Members to a pact with the Liberal Party, the Tory Party would not seek such a pact, and there would be a political stalemate.

The Labour Party put its manifesto before the country in 1974. The Government are tackling our economic difficulties and have carried out a large part of their legislative programme. I am not particularly anxious about the legislation on direct elections to the European Assembly or on devolution. The basic social legislation has been put on the statute book and is of great benefit to the country.

It would not be a bad thing for the House to have a quiet legislative period. The Government have already made announcements about what is likely to be in the Queen's Speech. Everybody knows that the next General Election will come before 1979. I suggest that not only the Liberal Party, but other minor parties, do not wish to have a General Election at this time. Only the Tory Party appears to be keen on an election. That is because it feels that the longer the Government stay in power and people begin to realise that they will soon benefit from the Government's policies, the less chance it will have of getting back into power.

I believe that the country wants a General Election like a goldfish wants a bicycle. It is the wrong kind of vehicle. It will not meet the needs of the people. The country does not want a Tory Government and it does not want a General Election. Therefore, I hope that the motion will be defeated.

It is up to the Liberal Party to decide whether it wants an agreement with anyone. It will not be in the interests of the Liberal Party to have a Tory Government returned—a Tory Government led not by a moderate such as the right hon. Member for Sidcup, but by a Right-wing extreme Tory advised by an increasing number of Right-wingers on the Opposition Front Bench. One can see the way that the more moderate, rational elements in the Tory Party are being thrown aside. I am not referring to the hon. Members for Cleveland and Whitby (Mr. Brittan) and Ealing, Acton (Sir G. Young) who are sitting there at the moment. Generally speaking, those who sit alongside the Leader of the Opposition are members of the extreme right wing of the party. It would be disastrous for the country to have a Tory Government led by the present Leader of the Opposition.

We do not need a General Election now. The Government command a majority in the House. We must begin to distribute to the people the fruits of the labours which they have contributed. I believe that at the next election the Labour Party will be returned with a majority to form a Government.

5.40 p.m.

Mr. Robert Adley (Christchurch and Lymington)

The fruits of the Labour Government to which the hon. Member for Aberdare (Mr. Evans) referred are already being enjoyed by the unemployed youngsters and the housewives who are paying a record price for food. The people are well aware of what the present Government have done for them. The hon. Member appears to think that everyone is happy. He has no doubt that his party would be returned by a smashing victory at a General Election. If that were so, we know that the Lib-Lab Pact would not exist and that the Labour Party would be going hell for leather for an election to return a Labour Government to Westminster.

I am sorry that the hon. and learned Member for Montgomery (Mr. Hooson), who spoke on behalf of the Liberal Party, has left the Chamber. I hope that the two Members of the Liberal Party who are here will not take it amiss if I say how nice it would be, for once in a while, if a Liberal speaker had the courtesy to stay in the House during the debate, as do Government Ministers. That would be an agreeable change.

The hon. and learned Member for Montgomery made a number of extravagant claims in justification of the Lib-Lab Pact. He implied that the Labour Government today are rather different and less disagreeable animals from those that they were two or three years ago. That is at variance with what the Leader of the Liberal Party said, as reported in The Tines as recently as 18th June. He said: Instead of staying to fight, David Marquand goes off to Europe, John Mackintosh to a chair at Edinburgh University, and now Brian Walden to a chair at London Weekend Television. A Labour Party unable fully to use the services of men like these is becoming a very different political animal internally from the party of Gaitskell. I am not sure what conclusion we should draw, but the inference is that the Labour Party is a much less moderate and less attractive animal than it was when the three people mentioned in that quotation were members of the Parliamentary Labour Party. If that is so, it makes a nonsense of what the hon. and learned Member for Montgomery said.

We are discussing the continuation in office of the present Government. The recently announced break-up of the United Ulster Unionists is also a relevant factor in enabling the Government to remain in office. That is as relevant as the support of the Liberal Party. I do not understand why the media go for the obvious and fail to look at the less obvious but equally relevant factors. The recent events in Belfast are as significant as the Lib-Lab Pact in enabling the Prime Minister to secure continuity of his life in office.

The Lib-Lab Pact is an arrangement of intellectuals, by intellectuals, for intellectuals. It is also an act of self-preservation. The Saffron Walden by-election increases the need of both the Labour and Liberal Parties to keep the pact going.

The combined Lib-Lab vote between the October 1974 General Election and the Saffron Walden by-election fell by 11,219 while the Conservative vote rose, on a reduced poll, by 1,401 votes. If the by-election means anything, it means the rejection of the pact by the voters, but simultaneously it means its increased attraction to the two parties in the House. That is an unhappy situation because it means that both the Labour and Liberal Parties are only too delighted to have an opportunity to fly in the face of the wishes of the electorate and to remain in office in contradiction to the express wish of voters as shown in successive by-elections.

All those who have studied the Parliamentary Liberal Party know that it depends for its survival on attracting Labour votes. In the Cornwall, North constituency, the Labour vote has been eroded to 6.4 per cent. In the Isle of Wight it is 13 per cent., in Berwick-upon-Tweed 14 per cent., Devon, North 14.2 per cent. and even in the constituency of the Leader of the Liberal Party the Labour vote is 8.9 per cent.

In order to retain their seats Liberal Members have to do everything that they can to persuade Labour voters in their constituencies to vote Liberal to keep out the Tories. I am not justifying the situation. I am explaining it. I have not heard a Member of the Liberal Party give that as a reason for retaining the pact.

Mr. Fairbairn

One could turn the argument round the other way. If one takes the constituency of the Leader of the Liberal Party one finds that 92 per cent. of the electorate voted not to have a Labour Government.

Mr. Adley

I am grateful to my hon. and learned Friend. That is the sort of mathematics that appeals to him.

The Saffron Walden result is, in its way, a major triumph for the Liberal Party. Looked at in the light of Stechford, Ashfield, Workington and Walsall, North it is a triumph because the Liberal Party managed not to lose its deposit.

There is a sea-change in the country. It is not a coincidence that the Conservative Party won those four seats. People have come to realise that Socialism means unemployment, an increased cost of living and a reduced standard of living. One would have thought that that would have registered with the Liberal Party, but apparently it has not.

I shall use a football analogy. The Liberal Party has through Saffron Walden avoided having to apply for re-election. One could take that analogy a little further. Does the hon. Member for Aberdare recall Ipswich Town winning election to the First Division? This unfashionable East Anglian side reached the First Division for the first time and had to play football against all the good, experienced teams. One read about the elegant, suave, polished Manchester United players playing superb football against country bumpkins. But the result was Manchester United nil, Ipswich six.

The same sort of thing happens when hon. Members insult my right hon. Friend the Leader of the Opposition. They are desperately out of touch with the views of millions who believe that my right hon. Friend speaks the same language as they do and that the strutting peacocks—the Prime Minister and the Chancellor of the Exchequer, aided and abetted by their sidekicks on the Liberal Benches—are strutting towards the edge of a precipice which will be reached when we have the next General Election. My right hon. Friend speaks more common sense in a week than hon. Members of the Liberal Party and the Prime Minister speak in a parliamentary year.

Nothing can illustrate that better than the Bidwell affair. The Prime Minister sniggered, sneered and derided my right hon. Friend the Leader of the Opposition when she asked him to deny the speech made by one of his colleagues who found that he was happy to be in alliance with the views of the Communist Party. Millions of people are concerned that the former chairman of the Tribune Group is able and happy to say that he is in full agreement with the Communist Party and yet the Prime Minister does nothing about it.

I turn back immediately to the Lib-Lab Pact. One of the claims that the Liberals have made is that they have managed to save the country from more nationalisation. We hear them claiming that, because of the pact, the nationalisation of banks and insurance companies has been averted. Perhaps the Minister will be able to give me an exact date, but we know that the Prime Minister, the Chancellor of the Exchequer and the Chancellor of the Duchy of Lancaster have now for at least a year, well before the birth of the pact, been saying that the present Labour Government had no intention of nationalising the banks and the insurance companies. That is one of the many spurious claims in justification for the pact.

My hon. Friend the Member for Altrincham and Sale (Mr. Montgomery) referred to the situation over the European vote. I agree with him. I thought that the Liberals were so easily pleased as to be quite ridiculous in claiming that their achievements over Europe had had any influence on the Government. We had a free vote in the Cabinet and indiscipline amongst Ministers and even, I believe, a minority of the Parliamentary Labour Party supporting the Bill on direct elections, yet still the Liberal Party is happy with what it claims is the Prime Minister's efforts to satisfy it that he will use his best endeavours to get the Bill on the statute book. I just wonder what the Prime Minister's second best endeavours will be if what we have seen so far are his best endeavours.

I should have thought that if the Liberals claimed to be the European party and that this was their priority and a true claim, they would realise that on this issue they could have formed a powerful phalanx with the Conservative Party and the pro-Europeans in the Labour Party to ensure that the legislation was pushed through at the earliest opportunity.

Mr. Beith

That is an interesting possibility. Can the hon. Gentleman give me any undertaking that the Bill would have contained proportional representation if we had done so?

Mr. Adley

I cannot. The hon. Gentleman must realise that I am not the Leader of the Opposition. If he had asked that question of my right hon. Friend the Leader of the Opposition before doing his deal with the Labour Party, he might well have got a very satisfactory answer, but I cannot answer the question for him. Perhaps he will say whether there was any consultation over this matter. I presume, from his remaining in his seat, that there was not. But we know perfectly well that Mr. Peter Hain and his friends would never allow the Parliamentary Liberal Party to form any sort of alliance with the Conservative Party.

I want to ask the Liberal Party some questions. Where do the Liberals think the pact is leading them? Do they believe that their Leader can stand up to the Prime Minister when it comes to trading-off deals? I believe that the Prime Minister has forgotten more about political deals in his 31 years in this House than the Leader of the Liberal Party will ever know. However, let us look to see what will happen.

What is the purpose of the pact? Presumably, for the Liberals it is to sustain the present Government in office until, as the Liberals hope, a miracle occurs and at a General Election the Liberal Party is returned instead of the Labour Party. But what will happen if the Labour Party wins the next General Election? The Prime Minister would be entering a Parliament in which he would be over 70 years old were it to run its course. No doubt during the course of that Parliament the Labour Party would have to decide to elect a new leader. Just who would become the leader after the present Prime Minister?

What on earth would the Liberals think if, as a result of their achievement —as they would claim—in sustaining a Labour Government through to the next General Election and a Labour victory, the right hon. Member for Bristol, South-East (Mr. Benn) were to finish as Leader of the Labour Party? Do the Liberals think that their leader would be invited to attend meetings of the Labour Party to choose its next leader? Of course not. However, that is the serious possibility.

The Liberals have not thought this thing through. This pact is a pact for today, to avoid at any cost a General Election.

The hon. and learned Member for Montgomery—we welcome him back to the Chamber—tried, as it was obvious that he would try, to paint the Conservative Party as a wild party of the Right. Perhaps he is rather disappointed that we have had somewhat moderate speeches from the Conservative Benches this afternoon. The extremists in British politics are surely the Communist Party or the Socialist Workers Party on the Left, and the National Party or the National Front on the Right. It is nonsense for the Liberal Party to try to pretend that because the Tribune Group is opposed to the pact, on the one hand, and a number of Conservatives are opposed to it, on the other hand, this is somehow an alliance of political extremists.

The danger for the Liberals is that they will finish believing their own slogans. I advise them strongly against that. They will be approaching the next General Election with their support for the present Government firmly stuck around their necks. I regret very much that the pact has been of so little influence that the Liberal Party was not even able to prevent the nationalisation of the aircraft industry, even though the pact came about before vesting day for that industry. Perhaps that is an illustration of what a wishy-washy affair the pact in fact is.

Finally, I turn briefly to the situation in my own constituency. A man who, until recently, was the chairman of the Christchurch and Lymington Liberal Party was very offended at being described as a "Lib-Lab". He was so offended that he wrote to my constituency office and threatened to take out a writ for defamation unless he received an immediate apology. I wrote to the Leader of the Liberal Party and asked whether it was the policy of his party to encourage its local organisations to issue writs for defamation if any of its local spokesmen were described as "Lib-Labs". The Leader of the Liberal Party wrote back and said that this was not part of the policy of the party's central organisation at all.

Much to my disappointment, we are still awaiting this writ. Perhaps the opportunity of this debate may give the gentleman concerned an incentive to issue his writ. He has now been removed from the chairmanship of the local Liberal Party, I am sad to say. He has been replaced by a lady, who wrote to the Lymington Times saying that it was disgraceful to suggest that Mr. Huish, the former chairman, was anything other than a good Liberal, and that he had always been a Liberal and, therefore, naturally, he was feeling hurt and insulted at being so described.

However, what the lady did not know, perhaps, and what Mr. Huish had apparently forgotten, was that in 1972 the aforementioned Mr. Huish applied for membership of the New Milton Conservative Club, signing the pledge that he was a member of the Conservative Party. None the less, we still await the writ. One knows not when it may come.

The pact has been put forward as being in the national interest, but it is nothing of the sort. It is merely an operation of self-interest on the part of the Liberal Party and the Labour Party.

Mr. Fairbairn

Does my hon. Friend remember the words of Lloyd George describing the last time the Liberal Party was idiot enough to hook up to the Labour Party, when he said that the Liberal Party would have to be the oxen to draw the cart of Socialism across the stony road of Parliament for two or three years and that at the end of it they would be slaughtered?

Mr. Adley

He was prophetic. I suspect that that is precisely what will happen.

My final point is that the Liberal Party has put the two cornerstones of the pact as the Government's European policy and the continuation of the social contract. The present Government were elected in February 1974 solely on the basis of their alleged ability to contain inflation through voluntary agreement with the trade unions. By October 1974 the present Chancellor of the Exchequer was claiming that he had got inflation down to 8.4 per cent. It then raged up to about 30 per cent. Now the Labour Party and the Government are claiming a great victory because they have managed to get inflation down to the point at which it is only double what it was at the time of the last General Election. In addition, the social contract, on the admission of the Prime Minister, is now finished.

I ask the Liberal Party: what can it claim as its justification for continuing with this pact other than that it is in its own self-interest to avoid a further General Election? I believe that this Government should go. I believe that the Liberal Party, if it had any guts and self-respect, would help that process rather than hinder it, and thus put the nation out of its misery.

6.0 p.m.

Mr. John Lee (Birmingham, Handsworth)

Despite the jollity of the hon. Member for Christchurch and Lymington (Mr. Adley) it has not been easy for him to conceal the sour grapes which he obviously feels about the present situation. His remarks about the Liberal Party have to be set in context. I hold no brief for that party, but there are those of us who can remember the times when, year after year, the electorate was defrauded by people who put themselves up as Liberal-Nationals and Conservative Liberals and Liberal-Conservatives. These people aimed at deluding the more naïve members of the electorate into believing that they were voting Liberal when in fact they were voting Conservative. If the Liberal Party gets a little benefit out of this present arrangement, I feel that it is getting a reward for that period while the Conservatives are suffering a nemesis for their behaviour in former years.

Pacts of this kind are not as novel as some Tory Members have suggested. One of the few sensible things which Ramsay MacDonald ever did was to form a pact with Herbert Gladstone in the early years of this century. That helped the Parliamentary Labour Party on its way. Some Members of the Liberal Party may regret that now. Many of us are much obliged to Ramsay MacDonald and Herbert Gladstone.

Perhaps more pertinent to this debate, with its screams of pain from the Conservative Party about the present arrangement, would be a reminder of those little incidents in Bolton and Huddersfield where there were Liberal-Conservative pacts, and the Dundee pact although no one won any seats from that because the electors of Dundee were too sensible to take any notice. The other two pacts helped to provide one or two seats for the Conservative and Liberal Parties. Thus, the situation is not all that new.

On a rather larger scale—although they certainly did not need it for numerical purposes, having, in the first instance, a rather large parliamentary majority anyway—the Conservatives went into coalition with the genuine Liberals, not the Liberal-Nationals, in the period 1931–32, a period which did not distinguish either of those parties by the excellence of government. Many of us would regard it as possibly one of the worst periods of that ignominious inter-war period of government. I have heard a reference to Herbert Samuel's coalition with the Conservatives at the time. Let us not have any humbug about this. We know that the Conservatives do not like this situation because it is denying them the opportunity, as they think, of bringing about a General Election. We are all party politicians, we are all subjective about this and look for party advantage, but there are other factors involved.

There is something else which is worth mentioning. That is that there has been a tendency in recent years for elections to take place with ever greater frequency. I do not believe that this is a good thing, whoever wins them. It is difficult enough for there to be economic planning over the prescribed period of a Parliament. No Government can look forward beyond a period of more than five years. Yet such are the demands of modern economic strategy that, if anything, that is an inadequate period. It is worth remembering that in the past 13 years there have already been five General Elections. Yet, if all of those Parliaments had gone their full length, they would have spanned a period of almost 25 years.

Let us get out of our minds the idea that this is a stale Parliament, that the electorate has not been consulted for a long time and that there is no reason why the Government should stay on. The fact is that any Government are entitled to carry out their mandate in going right to the full length of their time.

Let us not forget that the Conservative Government in 1959 went almost to the stage of Parliament becoming an unlawful assembly. I am not quite sure which date it was that that Parliament would have expired if Lord Home of the Hirsel —he has changed his name so many times I have almost forgotten it had not decided to go to the Queen in the autumn of 1964. No one would have said, certainly no Tory Member, that it was unconstitutional for Lord Home to do this, notwithstanding the fact that the electorate had grown manifestly tired of the Government which had been punctuated with explosions, spy scandals, the Profumo affair, the collapse of Macmillan's economic policies and a whole series of by-election casualties, in many ways as spectacular as those sustained by the Labour Party in the past few months.

Let us not have any high-flown constitutional arguments advanced on that score. While we have our current parliamentary system the Prime Minister has the prerogative of determining the length of the life of a Parliament. Not many people have advanced arguments in favour of a fixed period of time for a Parliament. No one has advanced the argument that we should have an entrenched clause in the constitution ensuring that Parliament is dissolved in any other way. Certainly no Conservative leader in recent times, with the single exception of the hapless right hon. Member for Sidcup (Mr. Heath) has failed to exploit the situation and the prerogative powers vested in him, using them for his own advantage. The right hon. Member for Sidcup thought that he was using those powers to his own advantage but succeeded in pulling down the house about his head. That is one of the many reasons why Conservatives are so sour about this.

In addition to the arguments made by my right hon. and hon. Friends, particularly by my right hon. Friend the Member for Fulham (Mr. Stewart), who dealt with the point in his usual skilful and urbane way, there is one other serious reason why an early General Election should not take place. I am sorry that the nationalists are not here because I do not like attacking them in their absence, particularly as I happen to like many of them personally. Whatever an early General Election produced in terms of a Government, I do not regard it as by any means certain that the Conservatives would get a majority; I do regard it as certain that there would be a considerable and disturbing increase in nationalist representation. There are two reasons for this.

The first is that the economic condition of the country is far from satisfactory. None of us would pretend otherwise. The second reason is that the nationalists at the moment have an additional dissatisfaction—and I know that some of my hon. Friends will not agree with me—in that the devolution legislation has yet to be passed. If this Parliament continues, I believe that we shall have a modified devolution Bill, which will pass into law. If this happens, and I am not widly enthusiastic about it, it is at least reasonable to suppose that by 1979 the nationalist tide may be on the ebb.

We may not then be faced with a situation that is so dangerous for the constitution. I would have thought that the more sensible Conservative Members would not relish a Government surrounded by a lot of nationalist Members on the rampage. That is, at least, a possibility. In the present climate of opinon in Scotland it is obvious that the nationalists would do well. I cannot think that that would make for stability of Government, quite apart from the other arguments my hon. Friends have advanced.

When the Conservatives say that we are unfair to them in prophesying that a Conservative Government would involve themselves in a head-on collision with the unions I pose this question: where among their ranks is there anyone of the stature of Walter Monckton? There is no one who comes anywhere near that. That is true even if the Conservatives were to choose people less lunatic than those who seem to surround the Leader of the Opposition at the moment. I do not say that the right hon. Member for Lowestoft (Mr. Prior) is one of the worst Tory Members, but I do say that the situation is soured so much that if he became Secretary of State for Employment, while he might do his best, he would not be able to cope. I am certain that the Leader of the Opposition would make things worse were she to become Prime Minister.

6.10 p.m.

Mr. Leon Brittan (Cleveland and Whitby)

I wish first to express the thanks of everyone on this side of the House to my hon. Friend the Member for Devizes (Mr. Morrison) for raising this subject for debate today. We are all much indebted to him.

Reference has inevitably been made to the Saffron Walden by-election. It seems to me that this provides a lesson for the Government at least as much as it does for the Liberal Party. The Prime Minister may be able to talk his way out of an election, but the Saffron Walden by-election shows that he certainly cannot talk the country into economic success. No amount of dangerously complacent speeches about economic indicators pointing in the right direction will deceive people into believing that they are better off than is really the case.

Prime Ministers who make speeches of that kind days before the trade union movement inflicts a devastating blow on their Government not only emerge with electoral egg on their faces, as they did at Saffron Walden; they also lose all their remaining credibility in terms of economic policy.

If the Liberals can derive consolation from Saffron Walden, good luck to them. They may have persuaded some dissatisfied Labour voters that the ark of the Social covenant is safe in Liberal hands. But if, after all the blaze of publicity that they have attracted in recent months, and with a candidate who had an invariably favourable Press, their share of the vote goes down as it did at Saffron Walden, it can hardly be treated as an electoral imprimatur for the Liberal-Labour pact.

The purpose of this debate is to look at that pact and to see whether the avowed aims of the Liberal Party fit in with the pact as it has been practised and with its forthcoming renewal. My hon. Friend the Member for Devizes has shown that the policies put forward by the Liberal Party in its latest demands are in great part to be found in the Conservative policy document. The response of the hon. and learned Member for Montgomery (Mr. Hooson) to that is to say "While the policies may be all right, one cannot be sure that they will be implemented". All I can say in reply to that feeble retort is that at least we are committed to implementing them, whereas the hon. and learned Gentleman must know that there is not the faintest chance of the Labour Party, with which he is allied, even expressing any desire to implement them.

Yet the Liberal Party is perpetuating the Labour Government in office, and here lies the central paradox—that a party which, even when it puts forward its formulations for the next phase, is closer to the Conservative Party than to the Labour Party, is none the less seeking its fortune with the Labour Party. That is what is puzzling so many millions of Liberal voters.

I am not suggesting, and neither did my hon. Friend, that the idea of a pact or coalition is itself in any way immoral or improper. Of course, nobody is suggesting that. There is nothing wrong with, and there is no reason to condemn, an agreement that is made for a reasonable purpose and has a reasonable chance of success, and which does not involve doing violence to one's own basic beliefs. In scrutinising the Liberal-Labour agreement, one should ask whether the pact comes within that definition.

Let us look at the origins and the stated purpose of the pact. When it came into existence on 23rd March 1977, the Prime Minister said that its purpose was to give the Government stability. He said: They will give the Government the opportunity of maintaining a stable position while they carry through their economic and social policies. The Leader of the Liberal Party deplored as one of the major causes of the British economic failure the lack of stable continuity. He, too, asked for stability, and said: The basis on which I approached the Prime Minister related to whether there could be agreement between us for a period of stability. What was to be the purpose of that period of stability? The purpose was essentially to secure progress on the economy and, in particular, to secure agreement on phase 3 of a pay and prices policy. I quote the Leader of the Liberal Party again in the same speech: We are coming up to a period—the Prime Minister stressed this in his speech—when in the national interest we must secure agreement on pay and price restraints."—[Official Report, 23rd March, 1977; Vol. 928, c. 1308–14.] To the extent that the pact, when it was first announced, was received with a measure of sympathy by political and economic commentators, it was so received because it was regarded as providing an opportunity for the Labour Government to reach a phase 3 agreement which would provide the measure of stability to which both Liberal and Labour spokesmen referred.

Has the pact achieved that stability? Has it increased the likelihood of a pay policy? The answer is plainly that it has not.

Let us look first at the question of stability. Since the advent of the pact the Government have lived from hand to mouth, with endless speculation about the date of the next election, while the nation has been enjoying the profoundly unstable spectacle of the hon. Members for Rochdale (Mr. Smith) and for Cornwall, North (Mr. Pardoe) vying with each other for television time to see who can be ruder about the other's views—hardly a spectacle of stability.

Again on the question of stability, what about the episode of the petrol tax, when one of the Government's major measures in their Budget was rendered uncertain, when for weeks we did not know what the rate of tax would be and what the Government would do? Was that an achievement of stability?

Then, most recently, we had the votes on the Finance Bill, when the Conservative Party and some hon. Members on the Government side united to defeat the Government and dock £450 million off the money that they would otherwise have had. There may be arguments against doing that. We think that it was a profoundly right course to take. But one thing that it most certainly shows is that the advent of the Lib-Lab pact has not brought about a period of stability in our economic life.

If that is the position on stability, what about incomes policy? The Liberal Party has regarded this as crucial. It has believed for some time in a statutory incomes policy and thought that even if the Labour Government would not introduce a statutory policy, at least their special relationship with the trade union movement would enable them to achieve for phase 3 a firm binding and specific agreement on the level of pay increases along the lines of phases 1 and 2.

What has come of all that? What has been the result of the pact for that central aim? The answer is that the policy is in shreds and tatters. The body blows were delivered last week by the miners' union and the Transport and General Workers' Union, and now the whole future of a deal of that kind looks very suspect. It is now clear that the very best that the Government can achieve is a pious statement hoping that there will be moderation in wage claims, and at the very least a commitment to the maintenance of the 12-month rule.

Whatever may happen to phase 3 of the incomes policy, phase 1 of the Lib-Lab pact has proved to be a very curious creature, a rather unattractive cross between a dead duck and a damp squib. At least, that is the position if one takes it at its face value if the reasons put forward for it at the time when it was introduced are taken seriously, it is merely to be denounced as a lamentable failure, but if one is a little more suspicious and a shade more cynical, one wonders how a party that accepts so much of what the Conservative Party wants to do, as my hon. Friend showed, can do a deal of this kind. Then of course it begins to look different. Then, instead of regarding it merely as a misjudgment, one wonders whether the claim by my hon. Friend the Member for Altrincham and Sale (Mr. Montgomery) —that it is no more than a cynical agreement to keep the Government in office—is not right.

The Government's motives are obvious —they want to stay in power, as Governments usually do, and if they can persuade someone else to make that possible when they would otherwise have lost command of the majority of the House, that is attractive to them. It is equally plain that the Liberal Party, faced otherwise with the prospect of an election when they fear total disaster, found such an agreement convenient.

That seems the real story, and the high-faluting explanations about stability and assisting in the achievement of phase 3 of an incomes policy appear to be no more than a farrago of humbug, deluding no one—least of all those who perpetrated it.

That is no doubt a mischievously suspicious thought to cast upon a pact that was hailed in such high-flown constitutional terms and with such high economic hopes, but there are some uncomfortable indications that the more suspicious and cynical interpretation may be true. After all, why should a party which professes to believe in freedom for the individual and the small business man make it more likely that the next Government will be an extreme Left-wing one?

That is a relevant question, because it is obvious even to members of the Liberal Party that the Government would have been defeated without their support and that the Government are trying to cling on until North Sea oil wafts them to victory. The election then will be fought on a programme of unadulterated Socialism. There is no reason to expect the Labour Party to do anything else. If ever the pledges that will be made by the Labour Party were implemented, the Liberals would be left high and dry—no more than a satellite in times of adversity, to be cast aside as a useless and tiresome piece of flotsam as soon as the Government's prospects improve.

By lending themselves to this nonsense, the Liberals are not only keeping Labour in office now, for which they have put forward an explanation which wears increasingly thin but at least has some spurious substance; they are also greatly increasing the chance of returning the Government to effective and full-blooded Socialist power in future, because they are enabling the Labour Party to take a moment of their own choosing to return to power.

The Labour Party is perfectly entitled to do that, and if the Liberal Party is happy, we all know where we are. What is objectionable is not a deal between the two to keep Labour in power and to make more probable the return of a genuinely Socialist Government; the only thing that is genuinely objectionable is the humbug and hypocrisy behind the spurious explanations of a short-sighted and misguided political deal.

However, it may be said that perhaps, after having made the mistake and learned that stability was not to be achieved or an incomes policy attained, the Liberals will recognise the national interest and where their principles lead them when they consider renewing the pact. This debate is timely, because that moment is rapidly approaching. Faced with the failure of the pact over the last few months and applying the criteria laid down by its founders, what will the Liberal Party's attitude be in future—a Liberal Party that has the views that my hon. Friend the Member for Devizes has described? If the justification for the pact is to be more than mere cynical political opportunism, economic progress is central. The belief in a statutory incomes policy is a central Liberal view.

If the Liberal Party is to have any internal consistency it must require that the Labour Party produces for the next phase of the deal either a statutory incomes policy or at least a copper-bottomed guarantee in the form of an agreement with the trade union movement such as it achieved for phases 1 and 2. Without such an agreement, by the Liberals' own professed beliefs, there is no justification for maintaining the pact.

That appears to have been the view of Liberal spokesmen themselves. Last week, the hon. Member for Cornwall, North said, on Independent Radio News: If the unions cannot deliver on phase 3, then the Government will have to step in with some statutory measures to ensure it. The Government has to hold the ring. Asked whether the pact would be jettisoned if the Government failed to put in statutory terms, he said: I think that that is now extremely likely. A complete disruption of phase 2 would lead to chaos and I do not intend said he boldly, to sit around being part of that chaos. In case anyone thought that the statements of the hon. Member, who is known for his agreeable characteristic of being a little trigger-happy, did not represent the views of the party as a whole, he would have listened and watched spellbound when the Leader of the Liberal Party was asked on "Panorama" whether a proper pay policy was a pre-condition of Liberal support for the next round of the pact, and replied: "Yes, it is."

He was then asked: Unless there is a phase 3 policy acceptable to you, the pact and the ten points become redundant? He replied: "That is right." He said that the Liberal Party was not involved in the negotiations, and added: It is for the Government to secure an agreement and for the rest of the country, including the Liberal Party, to judge whether it is watertight or, in the words of the Prime Minister, it is window dressing. If the Liberal Party means what it says, it can enter into the new round of the pact only if we have such a pay policy.

It is becoming clear that there is no prospect of such a pay policy, for better or—as some Labour Members below the Gangway would say—for worse. But whatever the situation, that is what the Liberal Party believes in, and we shall judge, not only its wisdom but its honesty and good faith by the way in which it acts when the time comes to see whether such a policy will be implemented.

Mr. Penhaligon

Does the hon. Gentleman agree that all that matters in the end is not precisely what words any agreement might contain about phase 3 but whether it works? That is certainly the judgment that I shall make.

Mr. Brittan

I agree entirely. However, it is possible to have words that do not work, but there cannot be an agreement that works without the words. At the moment, it looks as if we shall have neither the words nor the working. We shall have nothing. We are already seeing—that intervention was a minuscule cameo illustration of it—the gradual watering-down of the bold words of the hon. Member for Cornwall, North and his Leader. We are witnessing from the Liberal Party a cynical climb-down at a speed which makes an Olympic 100-metres sprint look like a race between elderly tortoises.

The reality is that the nature of the incomes policy that the Liberal Party will accept depends not one whit on what the country needs. It does not depend upon what the Liberals believe, if they believe anything at all. It depends upon what they think that the Government will be able to secure, because they are quite determined that, even if the Government secure absolutely nothing, they will still stick with the Government, because they have no alternative place to go to. They are huffing and puffing and about to blow themselves down.

We are entitled to ask a party that has made such bold statements about incomes policy, what is the sticking point? Is there a sticking point? Is there anything that the Government will do or will not do that will lead the Liberal Party to withdraw from the pact? Has there to be a statutory incomes policy? Evidently there has not. The hon. Member for Cornwall, North says that there has to be one, but withdraws that statement the next day. Has there to be an effective incomes policy? Perhaps there has but it is to be a face-saving formula?

Mr. Ioan Evans rose

Mr. Brittan

I am asking the Liberal Party, not the hon. Gentleman.

If there is a deal, what will have to happen for the Liberals to regard it as having been broken—perhaps when the railwaymen get 17 per cent. or the miners get 40 per cent.? The truth is that this policy of a pact has been shown—

Mr. Mike Noble (Rossendale)

On a point of order, Mr. Deputy Speaker. The next motion concerns people's working lives, not the kind of rubbish to which we are now being treated. Is there no way of ending this flow of nonsense?

Mr. Deputy Speaker

No way that is open to me.

Mr. Brittan

We are entitled to ask the Liberal Party these questions. I can see that their Big Brother allies are finding all this a little embarrassing, otherwise we should not have points of order that manifestly are not points of order. We are entitled to ask the Liberals this question: if they mean anything by this economic policy of theirs, when is the breaking point? What will have to happen 10 make them pull out?

Mr. Hooson

Before the Liberal Party or any other party decides to precipitate an election, is it not important to decide what the economic policy of the Conservative Party is? At the moment we do not know.

Mr. Brittan

The hon. and learned Gentleman has read The Right Approach", but obviously he has not read it very well. His objection to the document was not that it did not say what he wanted but that we would not do it. If he joined us in making it possible for it to be done, he might have the answer that he wanted.

The truth is that the Liberal Party has now to consider whether the pact will be renewed on any terms whatsoever. It will be renewed, because neither side dares to abandon it. The decision has already been made. The words will be found for it later, and if the words need to be altered after they have been entered into, or even at the moment of their utterance, there is no shortage of wordsmiths about the place to undertake that task.

There is no rationale for the pact in terms of policies, which is what I have been speaking about. The stability and economic advantages that the pact was supposed to achieve have not been achieved. Indeed, the Liberal Party is propping up a Government, who, in spite of what the right hon. Member for Fulham (Mr. Stewart) said, are by any normal standards not a Government at all.

I quote from Mr. Hugo Young, in The Sunday Times. He is not a supporter of the Conservative Party, I can assure the House. He says.: When is a Government not a government? Once upon a time there was a simple answer to this question: when it lost control of the House of Commons… But the definition is now clearly out of date. The Prime Minister's Government cannot be sure of getting anything whatever through the Commons, except possibly a confidence motion, yet Ministers seem to have no doubt that they remain the Government. They sit on the Speaker's right, in their usual place. They answer parliamentary questions, attend meetings of the Cabinet, employ the services of ministerial chauffeurs, draw the ministerial wages. All the outward formalities, in fact, are punctiliously observed. And that is perhaps the new definition of what it is to be the Government. It no longer has anything to do with governing, a function which implies the presence of a policy together with the means to carry it out. Instead, 'Government' is a state of mind, endorsed by the titles and insignia of office. That is what this Government have resorted to.

For a once-great Liberal Party, with a sense of history and of the values that it once believed in, to support such a Government is a disgrace to its principles and a betrayal of its supporters. Perhaps what we are really seeing is a manifestation of support for a new-found libertarian cause. The Government, as we have seen, are in effect dead. Perhaps the Liberals support them now as a practical demonstration of their belief in the legalisation of necrophilia.

The truth of that matter is that whatever is said here the harsh opportunist cynical facts bind the Liberal Party and the Labour Party together for the moment with fetters of iron. But iron is a heavy metal, as well as a base one, and the ship of State that depends on such links will eventually sink hopelessly to the bottom —and as this political "Titanic" goes down a relieved British public will hear the two captains hopelessly, helplessly and cheerlessly singing, the one to the other, the words "Abide with me".

6.37 p.m.

The Parliamentary Secretary to the Privy Council Office (Mr. William Price)

This has been an entirely predictable debate, but t I nevertheless find the behaviour of the Conservative Party rather surprising. The Conservatives should show more sympathy and tolerance towards newly-weds. The abuse began even before the reception had ended. We had warning of what was to come from the Sunday Telegraph of 27th March: From now on, as far as the Tories are concerned, it is war to the death with the Liberals. That is what we have seen today. We have had a mixture of hostility and ridicule, a determined attempt to ridicule, a determined attempt to belittle Members of Parliament who a little over three years ago were offered seats around a Conservative Cabinet table. It is a curious fact of political life that to have sustained a Tory Government would have been hailed as a patriotic act, whilst entering into an agreement with a Labour Government is the ultimate in treachery. There is a fundamental difference. That the Tory Government had put their record before the people and had been defeated. This Government have not done so and are not likely to do so for some time to come.

I fully understand the attitude of the Opposition. They want a General Elec- tion. We wanted one in 1953–54. We wanted one in 1962–63. We wanted one in 1972–73. We did not get one at any of those times, and the Conservatives are not likely to get one now.

The motion talks about the acceptance by the Leader of the Liberal Party of so many of the policies set out in 'The Right Approach' If that were true it would have been a remarkable achievement. I was under the impression that there were no policies in that document. In fact, whenever the Leader of the Opposition has been challenged in the House to spell out her policies there has been an ominous silence. I believe that there is something to be said for protecting the electorate from any political party without a programme of any sort.

I have recently had an example of this in my constituency. I have a factory caught up m the discussions over turbine generating and Drax B. It was important for me to know the likely attitude of the Opposition. I wrote in all innocence to the right hon. Member for Leeds, North-East (Sir K. Joseph). He did not reply. Earlier, my shop stewards had written to the hon. Member for Oswestry (Mr. Biffen), when he was Conservative spokesman on industry. I give him full credit; he was kind enough to reply. The trouble was that we could not understand what he said.

The motion gives the game away. Perhaps the Leader of the Opposition has clear policies and is afraid to reveal them, because she thinks that the Government, in pursuit of consensus politics, might introduce them for her. I doubt it, but it is an interesting theory.

The motion accuses the Liberals of plagiarism. There is nothing new in that. The gentle art of filching each other's policies has been going on for as long as I have been interested in politics. Indeed, I should have thought that it was the Liberals themselves who had most reason to complain. It is not for me to get into a dispute about the next Liberal manifesto. We shall not be involved in writing that, any more than they will play any part in preparing ours.

What I do argue is that the agreement between the Government and the Liberal Party is perfectly legitimate and has been fully justified over the past few months, and that there is every reason to believe that it will be sustained for a considerable time ahead.

One of the main criticisms of the Opposition during the past three years has been the fact that the Government were pushing ahead with their policies on a vote of only 38 per cent. in the country. The pact has increased that figure to 56 per cent. and still they are dissatisfied. And we know why. They will be satisfied with nothing less than the defeat of this Government—I do not object to their hoping that—and their own return to the office which they have always believed was theirs by divine right —and anybody who gets in their way is in for a rough time, as the Liberals have discovered. If the speech of the hon. Member for Cleveland and Whitby (Mr. Brittan) did not put the Liberals off for the rest of their natural lives, nothing ever will.

Yet it is the Opposition who know most about pacts—the pact, for example, which guaranteed 12 Irish votes in the House, the pacts throughout local government which enable independents and ratepayers to vote consistently with Tory groups, the pact in my constituency which enables the ratepayer group to attend meetings of the ruling Conservative Party. And there is the longest established pact of all—the unholy alliance between the Conservative Party and 85 per cent. of the national Press.

We have seen in recent times one of the most vicious and determined attacks upon a democratically elected Government. Certain Fleet Street editors and proprietors appear to believe that they, and they alone, determine when General Elections should take place. [HON. MEMBERS: "Bring back Harold Wilson."] They are unelected, undemocratic and largely unloved, but they have taken upon themselves not only the right to criticise and advise, but to instruct the Government what they will do, when they will do it and on what terms. To those hon. Members who are demanding the return of my right hon. Friend the Member for Huyton (Sir H. Wilson), I say that there is a fundamental difference between him and me. I am a newspaperman by profession and I am entitled to say that the trouble with my colleagues in the newspaper industry is that they take them- selves too seriously: their ability to influence events and votes is nowhere near as powerful as they, themselves, believe. If elections were decided by Fleet Street, the Labour Party would be lucky to hold a parish council seat in the Rhondda Valley even in a good year. Odd, then, that we have managed to win four of the last five General Elections. The power of the Press to influence people's voting intentions should be set in context.

I urge the House to discount much of what comes out of Fleet Street, particularly from those pundits who speak for the whole nation but who, I suspect, have never been down a pit, around a factory or in a working men's club. Where Mr. Ronald Butt—to take just one—gets his authority to speak for millions of Labour voters has long been a mystery to me. The sight of Mr. David English and Mr. Rupert Murdoch vying for the affection of the Leader of the Opposition is not an endearing one—and whether she is happy in the role of a Sun pin-up, I know not. Fortunately, page 3 gets far more attention from the Sun readers than does its editorials.

What is clear is that we have to face a continuing campaign in Fleet Street for a General Election; every incident will be blown up out of all proportion, every dispute on this side of the House will be magnified, and twice a week there will be rampant election fever at Westminster.

What I find odd about those newspapers which are opposed to the pact is that not so long ago some of them were demanding a mixture of coalitions, National Governments, consensus politics— call it what one will. The pact apparently took us some way towards that objective and one would think that it would have been widely welcomed, but it was not to he, and for one good reason—it was the wrong parties getting together. Fleet Street unashamedly wants Right-wing government and will do all it can to bring it about.

Of course the main argument is that the Government are unpopular, and I do not dispute that. Any Government who took the measures that we had to take—mainly to put right the mess left by the wrongdoings of the previous Administration—would be likely to endure some short-term unpopularity, but I ask the House, since when has it been political practice for an unpopular Government to go to the country? If that is to be the procedure in future—based presumably on local election, by-election, results—and, if I get my way, European election results—we are in for a hard time. We should make post-war Italy look like a haven of political stability.

The Leader of the Liberal Party summed it up in an article in The Times on 27th June. He pointed out that one of the arguments regularly advanced for not renewing the agreement was that the Government were unpopular and had been losing by-elections like a drunken sailor shedding fivers. I would not have put it quite like that—it really is no way to talk about one's in-laws—but I certainly agree with the rest of it: So did Conservative Governments in 1963 and 1973 but I do not recall the same newspapers demanding their resignations. It was inevitable that Saffron Walden would be called in evidence today. That is fair enough, and I do not think I should be giving away any internal secrets if I revealed that we had not been expecting to win. Indeed, without being in any way disrespectful to Saffron Walden, I had never regarded it as one of the more likely sites for the headquarters of the People's Republic. Not even my hon. Friend the Member for Ealing, Southall (Mr. Bidwell), an eternal optimist in these matters, would regard it as one of the more fertile of battle grounds. The revolution will clearly have to begin somewhere else. The Conservative and Liberal Parties will draw their own conclusions from that result. I believe I am entitled to say, however, that one does not judge Governments between General Elections. We have all become accustomed to the wild swings that have gone against both parties almost from the day they came into office. Whether the Liberals see the result as a justification for either extending or breaking off the pact is a matter for them. I certanly see no cause for the latter. Indeed, there are signs that others may be preparing to join In. There have been suggestions that the Ulster Unionists may be near to an agreement. I do not know, but there are limitless possibilities. The Scottish and Welsh nationalists, knowing that they will get no devolution out of a Tory Government, certainly ought to be in the fold. Then there is the Scottish Labour Party and—who knows? —we might even get back my right hon. Friend the Member for Newham, North-East (Mr. Prentice)—one great big, happy family.

One does not expect the Conservative Party to be attracted to that possibility. They believe that they are on to a good thing. We have planted the trees and they want to pick the fruit, and in their view only the Liberals stand in their way.

I am not satisfied that it is as simple as that. I need a lot of convincing that traditional Labour voters are going to be queueing up at a General Election to vote for the ideology of the Leader of the Opposition and the guru from Leeds, North-East.

We shall put it to the test at a time when the British people can make a fair and objective judgment on our record—and on the pact. We were elected for a five-year term and we are entitled to go the full period, if that is what the Prime Minister decides, so long as we have a majority in the House.

Of course, we know why the Tories and their backers want an early General Election. They see the probability of an entirely different situation in 12 months' time. That is what this motion is about, and we might as well recognise it. The Leader of the Opposition can send the furniture van away. The pact is in good shape, the Government will continue and, in due course, the people will make their decision.

This motion invites the Liberals to go over to the other side, although heaven knows what they will find there. I do not believe that they were ever likely to do that, and if they were in any doubt this debate should have left them in no doubt.

Mr. Noble

Does my hon. Friend agree that, in the light of discussions taking place in Geneva, textile workers in my constituency and the constituencies of my hon. Friends the Members for Bury and Radcliffe (Mr. White), Sowerby (Mr. Madden), Oldham, East (Mr. Lamond) and Oldham. West (Mr. Meacher), who is unable to be present today, would face a serious setback to their employment prospects if the pact should collapse? The constituency of the hon. Member for Rochdale (Mr. Smith), which has the highest concentration of textile workers, would face the most serious blow of all.

Mr. Price

I think that my hon. Friend is right, and I regret that we have had to spend so much time on the first motion, leaving insufficient time for his motion. I sat down early in the hope that my hon. Friend might have been able to say a few words on the second motion, but I suspect that he will not have the opportunity.

6.54 p.m.

Mr. Norman Tebbit (Chingford)

The Minister's speech makes perfectly plain the real nature of the Lib-Lab pact. He refers to the possibility of giving people a choice. What the pact is really about is that the Government were looking around for someone to vote for them, and it happened that the first takers were the bunch of political hermaphrodites who sit on the Liberal Benches.

The hon. Member for Aberdare (Mr. Evans) made a very revealing comment when he said that he supported the pact because before 1974 "we had a serious crisis". What does the hon. Gentleman think the present crisis is—a funny one?

The right hon. Member for Fulham (Mr. Stewart) said that we now had inflation better under control than at the time of the last General Election. At that time inflation was at 8.4 per cent. and now it is 17 per cent., but the right hon. Gentleman says that it is "under better control". That must give great reassurance to all traditional Liberal voters in the country, that they are now helping to support, through their parliamentary representatives, a Government who have inflation "under control" at 17 per cent. What great joy it must bring to so many Labour Members who normally sit below the Gangway.

The Lib-Lab pact has cemented the social contract just in time for the Prime Minister to announce that the social contract has broken. The average worker on average industrial wages is now losing £8 a week as against the real value of the wage that he was receiving in October 1974. The Lib-Lab pact is, therefore, costing the hard, genuine Labour voter £8 a week. I do not know how much Labour Members normally ask for as a sub when they try to gain members for their respective parties, but I think that if many of us asked for £8 a week when we knocked on someone's door he would think that we had a bit of a cheek. Yet that is what the pact has cost, and that is what the Liberals are supporting.

It may be doing the Liberals and the Liberal Party some good. I wait to see. In the recent Greater London Council elections in my constituency the Liberals did not even come third. They came fourth, behind even the National Front. That is one comment from Liberal voters on the bunch of charlatans in the House who have betrayed them. Those are the comments that have been made by Liberal voters in the country.

I know full well that my right hon. Friend the Member for Sidcup (Mr. Heath) tried to persuade the Liberals to enter a coalition—I disapproved of it intensely—and the Liberals said that they did not want to become involved in a coalition because they did not want to get into collective responsibility. How can they get involved with the present Government and not get involved in collective responsibility?

The more I think of the pact the more I am reminded of the little poem about a pig and a drunk who fell asleep in the gutter, as someone was walking by. The poem ends: A passerby was heard to utter, Gazing at the couple in the gutter, You can tell a chap that boozes By the company he chooses, And the pig got up and slowly walked away. What is a puzzle to every Liberal-minded man and woman in the country is whether it will be the drunk or the pig that finally gets up and walks away from this disastrous pact.

The whole of the time that the Liberals have given to the Government to live on is time for the Government to create some sort of scare, some sort of sudden boom—if that is within the Government's capacity—or to convince people that it will be sunny yet again, and to go for an election which the Government and the Liberals must calculate would be more likely to return a Socialist Government. That is what the Lib-Lab pact is about—a great change in traditional Liberal policies, away from support of a free society, away from a society of individualists and towards a society of collectivism, towards a Government who support collectivism, a Government supported not only by the people but by the Liberal Party and by those Labour Members who sit below the Gangway—

It being Seven o'clock, proceedings on the motion lapsed, pursuant to Standing Order No. 6 (Precedence of Government Business).