Commons Sitting of 6 April 1978

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

    Young Offenders
    Mr. Kilroy-Silkasked the Secretary of State for the Home Department how many 14–16 year-old (a) boys, and (b) girls were (i) in local prisons and (ii) in remand centres at the latest available date.
    The Under-Secretary of State for the Home Department (Dr. Shirley Summer-skill): On 28th February there were 15 boys aged 14 to 16 in local prisons and 337 in remand centres. The corresponding figures for girls were 8 and 10.
    Mr. Kilroy-Silk: Does my hon. Friend agree that although there has been a welcome decrease in the numbers on remand following the tightening up of the criteria for the issue of unruly certificates, it is totally unsatisfactory that there should be such remands of technically innocent children? Does she therefore accept that more pressure should be put on the Department of Health and Social Security to provide alternative resources? Does she agree that the best way of putting on such pressure is for her Department to take legislative action to make such remands illegal?
    Dr. Summerskill: As my hon. Friend knows, the Government's policy outlined in the recent White Paper is to end the remand of all people under 17 years of age to Prison Department establishments as soon as is practicable. Obviously there are economic restraints, but I can assure him that my right hon. Friend the Home Secretary and my right hon. Friend
    610
    from the Department of Social Services are doing everything possible to hasten this matter.
    Mr. Ron Thomas: I have recently visited Holloway Prison with some of my hon. Friends. Could my hon. Friend seriously consider setting up either a Royal Commission or a high-powered inquiry to consider the position of women in prison and the philosophy behind it, and especially women with babies and pregnant women who are in prison?
    Dr. Summerskill: My hon. Friend's question relates to adults in prison and there are two further Questions on that subject on the Order Paper. I do not believe that the question of women with babies necessarily constitutes a separate issue. Certainly my right hon. Friend, who has heard the request, will bear it in mind.

    Broadcasting (White Paper)
    Mr. Whiteheadasked the Secretary of State for the Home Department if he is now able to say when he expects to publish the White Paper on broadcasting.
    The Secretary of State for the Home Department (Mr. Merlyn Rees): I am still considering the Annan Committee's report and the comments that I have received on it. The report raises many important and complex issues and I am not yet able to say when the White Paper setting out the Government's proposals will be ready for presentation.
    Mr. Whitehead: I appreciate that, but does my right hon. Friend agree that it is now over a year since the Annan Report was published and that every month that goes by without decisions makes easier the task of the slick and well-financed lobby for an ITV 2, which is rejected by most independent students of broadcasting and the majority of my hon. Friends?
    Mr. Rees: The report was 500 pages long and contained 174 recommendations. What I want to do in the White Paper is to take the discussion further before we have legislation. I know that many people are taking up prepared positions, but they will just have to wait until they see the Government's proposals.
    Mr. Michael Latham: The proposals for local broadcasting were extremely

    611
    controversial—certainly to listeners of BBC Radio Leicester. Has the Home Secretary really kicked this matter into the long grass for the rest of this Parliament?
    Mr. Rees: No. I shall be publishing a White Paper, which the hon. Member can read and form a view on.
    Mr. Hugh Jenkins: Does my right hon. Friend realise that some of us do not mind his taking a fair time to consider this matter, provided that he takes the right decision in the end and, as my hon. Friend the Member for Derby, North (Mr. Whitehead) said, rejects the meretricious proposals for an ITV 2.
    Mr. Rees: I am sure that I shall come to the right conclusions.
    Mr. Freud: The House will welcome the Home Secretary's saying that he does not know when the White Paper will be issued. His Department announced that it would be issued in the autumn, by the end of the year, and in March. Is the Home Secretary aware of the disservice that this is doing to the industry? This might be good for democracy but it is pretty bad for broadcasting.
    Mr. Rees: I do not agree with the hon. Gentleman. A most interesting report, a White Paper, and then legislation, will set the pattern for the next 15 years. Perhaps those in the industry who think that a quick answer is possible are the same people who give quick answers to serious problems on their television programmes.

    Immigration (Select Committee's Report)
    Mr. Arnoldasked the Secretary of State for the Home Department whether he agrees with the recommendations of the report of the Select Committee on Race Relations and Immigration on immigration; and if he will make a statement.
    Mr. Dudley Smithasked the Secretary of State for the Home Department what action he now proposes to take on the recommendations of the Select Committee on Race Relations and Immigration with regard to the problems arising from immigration from the Indian subcontinent.
    Mr. Merlyn Rees: I shall be making a statement relevant to the recent report of the Select Committee at the end of Question Time today.
    Mr. Arnold: Does the right hon. Gentleman agree that, whatever his view about the shortcomings of some of the details of the Select Committee report, it is nevertheless a constructive approach to the problems of immigration? Why was he not prepared to welcome the publication more fully?
    Mr. Rees: I welcomed the publication of the Select Committee report. There can be no doubt about that. The Government are, however, entitled to read it and put forward their views. They do not have to accept a Select Committee report.
    Mr. Smith: Is the Home Secretary aware that the report is severely critical of the Home Office for the lack of official and accurate figures on this emotional subject? Does he not think that the Home Office should set itself the task of finding out how many immigrants there are in this country and, perhaps even more important, how many more are lawfully entitled to come here?
    Mr. Rees: I hesitate to get involved in this matter in advance of my full response to the report. However, the hon. Gentleman is wrong. First, he must read the report that he signed. The Home Office is concerned about immigration statistics. The statistics applying to people living in this country are a different matter. But I would rather leave this matter alone for the moment.
    Several Hon. Members rose—
    Mr. Speaker: Order. There will be questions later, when the statement is made.

    Hospital Broadcasting Services (Advertisements)
    Mr. Hugh Jenkinsasked the Secretary of State for the Home Department whether, having regard to the overwhelming rejection of advertising by hospital broadcasting services, he will refuse to sanction any experiment in this field.
    Dr. Summerskill: My right hon. Friend has written to my hon. Friend explaining, as he announced in the House

    613
    on 23rd March, that he proposes to authorise advertising as part of the hospital broadcasting service conducted by London Hospitals' Broadcasting, for an initial experimental period of one year.
    Mr. Jenkins: Is my hon. Friend aware that London Hospitals' Broadcasting is not representative of hospital broadcasting organisations either in London or in the country as a whole? Does she recognise that this deceitful title of London Hospitals' Broadcasting has been chosen by the organisation because it was set up precisely for the purpose of commercialising hospital broadcasting? If this concern is allowed to get away with it, it will destroy a voluntary service which is greatly valued in the hospital community.
    Dr. Summerskill: This is an experiment for one year. It does not imply a permanent service. It will enable information to be obtained for dealing with any future applications.
    Mr. Whitehead: Will my hon. Friend consider extending hospital broadcasting beyond the current normal rules of curtilage which apply here, because this is a valuable experiment in local radio?
    Dr. Summerskill: I am sure that my hon. Friend's view will be taken into account at the end of the year, when the whole issue is reviewed.

    Juvenile Crime
    Mr. Ioan Evansasked the Secretary of State for the Home Department what was the percentage increase in juvenile crime in 1975, 1976, and 1977, compared with 1974; and what action is proposed to deal with the problem.
    Dr. Summerskill: I am glad to say that my hon. Friend's assumptions are mistaken. In 1975 there was not an increase but a 5 per cent. decrease, compared with the 1974 figure, in the number of juveniles found guilty of or cautioned for indictable offences per 100,000 of the population in the relevant age group. There was a further 4 per cent. decrease in 1976. Figures for 1977 are not yet available. The Government's policies for dealing with the problem of juvenile crime were set out in some detail during the law and order debate on 27th February.
    Mr. Evans: I thank my hon. Friend for those interesting statistics which, at a time when so much is being said about increasing crime, show that there is a reduction in juvenile crime. Does she agree that magistrates' courts should be encouraged to use community service orders rather than to award custodial sentences, as that would be a method of keeping young people away from a life of crime?
    Dr. Summerskill: I assure my hon. Friend that magistrates' courts are being encouraged to do so, and there is evidence that they are using an increasing number of community service orders.
    Mr. Edward Gardner: Has not the time come when the Government must decide to adopt positive and effective methods of dealing with juvenile crime on the lines of the recommendations of the all-party Expenditure Committee and the Conservative Committee on Juvenile Crime? Is it not essential that there should be amendments to the Children and Young Persons Act, so that the juvenile courts can be given the powers they so sorely need to deal with the growing band of persistent offenders?
    Dr. Summerskill: There is no evidence to suggest that the hon. and learned Gentleman's proposals would necessarily lead to any improvement in the situation beyond that achieved by the measures which are now available to the courts which are extremely extensive, especially in view of the provisions of the recent Criminal Law Act.
    Dr. M. S. Miller: Is my hon. Friend aware that it is comforting to note the reduction shown by her figures? Does she not think, however, that those figures are still unnaturally high as a result of harassment by the police of young people in many parts of the country—young people who are merely showing a certain amount of exuberance but who in some cases are being victimised by exuberance on the part of the police?
    Dr. Summerskill: My hon. Friend has made a generalised statement. If he has any specific cases in mind perhaps he will let my right hon. Friend and myself have them, so that we may look into them.
    Mr. David Howell: The Minister says that there is no evidence to show that restoration of powers to magistrates would help solve the problem of juvenile crime, but is that correct? Is there not evidence coming to her, as it is coming to many of us, from magistrates all over the country that they believe that some of the principles of the 1969 Act were wrong and that the time has come to amend it at least to give magistrates power to make secure care orders in line with the expansion of secure accommodation, which we all believe is necessary?
    Dr. Summerskill: I am sure that the hon. Member would agree that in such a complicated matter as the causes and prevention of crime no one would claim that he had any positive evidence that a particular proposal was the right remedy. I can only say that what the hon. Gentleman is suggesting is a belief; it is by no means a certainty.

    Child Offenders
    Mr. Michael McNair-Wilsonasked the Secretary of State for the Home Department whether he will take steps to introduce parental liability as a circumstance to be considered in cases involving children under 10 years of age.
    Dr. Summerskill: Juvenile courts are required to take into consideration all the circumstances of a child's background before deciding what order, if any, to make in care proceedings. In my view the court's power to bind over parents to take proper care of and exercise proper control over their child is a sufficient reminder of parental responsibility.
    Mr. McNair-Wilson: Since that can mean that nothing will be done to impose a real penalty upon the parents, should not parents be fined when they choose to refrain from restraining their children from committing petty crime?
    Dr. Summerskill: There already is power in the case of children over 10 for the parents to be liable to pay a fine or compensation. The Criminal Law Act 1977 raise the level of fines as well as providing additional powers to enforce payments on parents. I do not think that these are sufficiently well known.
    Mr. Rathbone: Will the Minister reconsider her answer and see whether it
    616
    would be advisable to extend these powers to cover the parents of children under 10?
    Dr. Summerskill: Children under 10 are not legally able to be convicted of a criminal offence. I should like to see how the present changes in the Criminal Law Act oeprate before we consider further changes.
    Mr. McNair-Wilson: On a point of order, Mr. Speaker. In view of the unsatisfactory nature of the Minister's reply, I give notice that I shall seek to raise the matter on the Adjournment at the earliest possible moment.

    Mr. David Duke
    Mr. Rostasked the Secretary of State for the Home Department if he will call for a report from the chief officer of police on the steps taken to apprehend Mr. David Duke, the Ku Klux Klan leader, who is subject to a deportation order.
    Mr. Arthur Lewisasked the Secretary of State for the Home Department whether he will now cause an investigation to be made to ascertain how and why it took the authorities 14 days to serve a deportation order on Mr. Duke, in view of the fact that he was known to be freely available for interview with representatives of the media.
    Mr. Merlyn Rees: Mr. Duke, who has now returned to the United States of America, was not subject to a deportation order but to a variation order curtailing his stay. I am satisfied that the police took all reasonable steps in the case, bearing in mind that a variation order must be served personally and carries no power of arrest. I see no reason to call for a report.
    Mr. Rost: Does not this incident, however, involve an important matter of principle—namely, what criteria the Home Secretary of a democratic State should apply in using his discretion in deciding which visitors from abroad should be allowed entry and which should not? Why, for instance, should members of the Ku Klux Klan or the Scientologists be banned, and yet others who might be a more serious threat to the security of the State, such as Marxist revolutionaries or subversive agents, be admitted freely?
    Mr. Rees: This matter raises problems for a Home Secretary, as to whom he deals with in this respect. The hon. Gentleman has called in question the methods that we use. A man arrives in this country as a normal tourist. There is no way of telling what his views are. What has happened should not be a reflection on the immigration service or the police. I took a judgment—it is a judgment that I have to take—that the way in which the man behaved when he came here showed that he was not someone coming to visit, in terms of the way in which he proceeded to go around the country, to have his picture taken outside the Home Office and outside the House. It was a question of the way he behaved. The man was better off in the United States. He arrived in Washington the other day while I was there, but no one seemed to take any notice.
    Mr. Lee: How long did it take before my right hon. Friend made up his mind that this man should not stay in this country? How much did it cost to chase him? Finally, will my right hon. Friend say whether there is a list of Ku Klux Klan members supplied to the immigration authorities to enable them to intercept them in the future and to prevent anything like this happening again?
    Mr. Rees: My hon. Friend must reconsider the way in which he has put this question. It would be impossible to get a list of people who had been in the Ku Klux Klan, to get a list at the ports, and to have them checked. I put a stop on one man who was a leader, but given the number of people coming in and going out of the country, which increases every day, it is impossible to put this burden on the immigration service.
    If the man concerned had come here and had behaved just as a tourist and minded his own business, no one would have bothered. It was only when he did not that I took a judgment. As for the cost, it would be impossible to tot that up.
    Mr. Hooson: Am I right in thinking that the criterion that the Home Secretary applies in such cases as this is whether the person who has come in is misusing the hospitality of this country, as it were, and that that applies whatever his political views are?
    Mr. Fell: Such as Peter Hain.
    Mr. Rees: The operative words are "conducive to the public good". I was agreeing with the hon. Gentleman who raised the question. I believe that any Home Secretary ought to be careful as to the degree to which he uses this power, particularly in this country, where, on the whole, we can bear people coming here with political views and it does not hurt the country. I took a judgment with regard to this man and the way in which he behaved in the current situation. But the criterion is contained in the words "conducive to the public good".

    Subversion (Definition)
    Mr. Robin F. Cookasked the Secretary of State for the Home Department if he will exclude from his Department's definition of "subversion" legitimate political activity.
    Mr. Merlyn Rees: I see no reason to depart from the definition given in another place by my noble friend the Minister of State on 26th February 1975 which was
    "activities … which threaten the safety or well-being of the State, and are intended to undermine or overthrow parliamentary democracy by political, industrial or violent means "
    Mr. Cook: Can my right hon. Friend explain why it has been necessary for the Home Office to go much wider than the definition originally offered by Lord Denning in 1963, which clearly defines subversives as those who would contemplate the overthrow of the Government by unlawful means? Is my right hon. Friend not aware that acting on the present definition of subversion, the Special Branch has been seen to note those who attend anti-apartheid meetings, or enrol for WEA classes? Does he regard these people as subversive? If not, will he prevent the police from noting down their names?
    Mr. Rees: In the particular case of the WEA classes, I reminded the police force concerned that I was, and would be very happy to be again, a tutor in the WEA. But it was considered to be too remote a possibility to bother about.
    There are difficulties in this respect. Definitions of this matter, however drawn up, are not sufficient. I know what I mean when I have duties to perform in this respect. I am not worried about people who have political views and who express them in this country, but subversion is a

    619
    different matter. I do not believe that it can be defined absolutely firmly. When it arose at the Windscale inquiry, I can assure my hon. Friend that I was certainly not worried about those whose views were against the use of atomic power, in the way suggested then. But it would be wrong to argue about definitions.
    Mr. Alexander W. Lyon: Is my right hon. Friend not concerned about the fact that the scandal of the Special Branch in South Australia took place under the presidency of a chief constable who used to be the Chief Constable of the North Riding of Yorkshire? One ought to consider the powers of the Special Branch and of the security services. If they are so innocuous, does my right hon. Friend mind if I look at my file in Box 500?
    Mr. Rees: I think that my hon. Friend would find that it was not worth reading.
    In this country we ought to be extremely proud—I think that that is the right word—that we have not had the excesses that occur in other countries. I have been involved in these matters for some time. In my view, it is because we are careful about the use made of these powers. I do not believe that it comes out of inquiries; it comes out of good sense. That is the job of any Home Secretary in this respect, and I am perfectly satisfied that there is no abuse.
    Mr. Eldon Griffiths: Does the Home Secretary agree that it is very important to deal with subversion before it arises as well as after it has arisen? [HON. MEMBERS: "How?"] Therefore, it is a perfectly reasonable activity that the Special Branch should monitor activities that could lead to threats to the State. Will the right hon. Gentleman also say that this very hard-working and often overstretched arm of the police service does a first-class job for this country?
    Mr. Rees: The Special Branch does an excellent job. I think that it would be wrong to bring the political aspect of their work into this matter. It would be a grave mistake, because I believe that it would be going much too far in the wrong direction, and it is something which, quite properly, one does not talk about. The impression so far is that the Special Branch is engaged in a great deal of political work. That is not true. It
    620
    would be concerned with subversion from not just the Left but the Right.

    Prison Population
    Mr. Knoxasked the Secretary of State for the Home Department how many people were serving terms of imprisonment in Her Majesty's prisons at the latest available date; and what proportion of them were in prisons constructed before 1900.
    Dr. Summerskill: On 28th February the sentenced population in Prison Department establishments in England and Wales was 28,349, of which about 65 per cent. were in establishments first used for the purpose before 1900, although, of course, most of these establishments have been added to and improved since then.
    Mr. Knox: Does the Minister agree that there are far too many people in prison at present and too many in buildings which are much too old? What hope is there of reforming prisoners if they are living in conditions such as those? What is the Minister doing to reduce the size of the prison population and to make sure that in more modern prisons fewer prisoners are housed?
    Dr. Summerskill: Within the limits of financial constraint, every effort is being made to reduce overcrowding and to expand capacity. There are plans to provide for the completion of building schemes already in progress, so that in the next five years there will be an additional 4,700 places. The picture is not all black, because during my time at the Home Office I have had the honour to open a purpose-built prison.
    Mr. Edward Lyons: Will the Minister bear in mind that most of our prisons were built as human cattle pens—those such as Leeds and Wandsworth, and many others—and that until we have modern prisons there is very little hope of rehabilitation, or of prisoners doing useful work? Will the Minister, therefore, press very strongly on the Chancellor of the Exchequer the view that it is in the interests of the prevention of crime and the reduction of the commission of crime to have more modern prisons, where there is more chance of rehabilitation and of prisoners doing useful work?
    Dr. Summerskill: I agree with my hon. Friend that the most overcrowded establishments tend to be the local prisons, especially in the North. But we have noted the recommendation of the Advisory Council on the Penal System that perhaps the best way to reduce the prison population is to reduce the average length of sentence rather than necessarily swinging to non-custodial penalties.
    Mr. Charles Irving: Will the hon. Lady consider the fact that there are at least three open prisons which have been closed and are not being used at the moment, and seriously consider bringing back into use some of those prisons, which could relieve some of the disgraceful and degrading conditions which exist in the closed prisons?
    Dr. Summerskill: It so happens that the prison that I opened in 1974 was an open prison, and it is still open. The reason for the tendency to close open prisons is that the type of person who is now going into prison tends to require strict custodial treatment.
    Mr. Flannery: Would my hon. Friend accept it from me that on a recent visit with some of my hon. Friends to the women's prison at Holloway we were alarmed to find that almost 80 per cent. of the women were in for stealing—mainly shoplifting—and that, in personal conversations the staff, whom we found to be very humane, we gathered that they felt that far too many people were put in prison for trivial offences? Does this suggestion not offer us one means of preventing overcrowding in our prisons? Will she take it up?
    Dr. Summerskill: Whether someone is sent to prison is a matter for the courts, but, as I said in reply to an earlier question, the courts are now being given every encouragement to impose non-custodial sentences.
    Mr. Speed: Is the Minister aware that we would agree with an earlier reply that she gave, that perhaps shorter, sharper sentences would be the answer? Is there any evidence linking the rate of recidivism with the age of the prison? I have seen none myself.
    Dr. Summerskill: To correct the hon. Gentleman, I said "short"; I did not say "sharp"—that was his Freudian
    622
    word. We have no evidence at the moment on the subject of recividism and age of prison.

    Lancashire (Police Inquiry)
    Mr. George Rodgersasked the Secretary of State for the Home Department when he anticipates that the findings of the police inquiry into business and local government matters in Lancashire being carried out under the direction of the Chief Constable of Nottinghamshire will be available; and if he will make a statement.
    Mr. Merlyn Rees: I understand that the Director of Public Prosecutions has recently received the report of the investigation and is at present studying it.
    Mr. Rodgers: One appreciates the necessity for thoroughness in these matters, but does my right hon. Friend not agree that the findings of this inquiry and the decision whether to reopen the Osmonde inquiry into the conduct of the Chief Constable of Lancashire should be finalised as quickly as possible? Does he agree that until these matters are resolved there will be a cloud over the administration in Lancashire and over the heads of many hundreds of innocent and decent people.
    Mr. Rees: I agree with my hon. Friend. I know that he understands why I could not see him until late on in this matter; it was because I had an appellate role to play. I am sensitive to what he says and I shall certainly make a statement as soon as I can. I agree that a long period has passed, but I have to proceed in a proper manner, because there are legal aspects.
    Mr. Edward Gardner: Will the Home Secretary direct his attention to the serious criticisms that have been made by the Chairman of the Lancashire Police Committee, County Councillor Frank Lofthouse, about the state of the regulations which govern the disciplinary procedure under which the Chief Constable of Lancashire, as he then was, was dismissed from his post?
    Mr. Rees: I have looked at that matter, but it is of a particular nature. What my hon. Friend is concerned about is a general situation in the county of Lancashire. I think that it is right for all concerned that I make a statement on that as soon as I can.

    Football Hooliganism
    Mr. John Evansasked the Secretary of State for the Home Department if he plans to introduce further measures to combat football hooliganism.
    Dr. Summerskill: My right hon. Friend is having a further meeting very shortly with my right hon. Friend the Minister of State, Department of the Environment, who has responsibility for sport and recreation, and the Chairman of the Football Association, to discuss recent incidents.
    Mr. Evans: Does my hon. Friend accept that the call by Sir Harold Thompson, Chairman of the Football Association, at the time of the Millwall-Ipswich riot, for greater Government action to combat hooliganism looks a bit sick now, when the so-called punishment dished out to Millwall is considered? Has not that punishment been reduced to farce by the decision of the Football League to allow Millwall to play its "away-home" game at the end of the season? Is it not time that my hon. Friend called on the football authorities to put their house in order by segregating all supporters, fencing all football grounds and, particularly, banning the sale of alcohol at football grounds?
    Dr. Summerskill: My right hon. Friend has regular meetings with the police and football and transport authorities as necessary, and the Minister with responsibility for sport and recreation chairs a working party on crowd behaviour. Constant discussions are going on with sporting clubs to see how best to stop this sort of hooliganism.
    Mr. Brotherton: Is the Minister aware that this is a problem not basically for football clubs but for the Home Office, the police and law and order? Therefore, will she make sure that the punishment inflicted by magistrates on hooligans is sufficient to meet the crime? Furthermore, does she not agree that it is time that we returned to corporal punishment for the young hooligan?
    Dr. Summerskill: The hon. Member must be aware that the Criminal Law Act 1977 raised certain maximum summary fines for those over 17, for young persons and for those under 14. This is a range
    624
    of penalties to deal with offences associated with football hooliganism. It would be better to see how those penalties affect the situation before considering further measures in the way of penalties.
    Mr. Pavitt: Will my hon. Friend take a special look at hooliganism by football crowds en route to a match? In my area, for example, the Cup Final will be held at Wembley on 6th May. Will my hon. Friend discuss with the Secretary of State for Transport ways of easing this problem, which for many of my constituents becomes an annual nightmare?
    Dr. Summerskill: Whenever a local match is to take place, police forces locally exchange information with the clubs, with supporters' organisations, and with transport undertakings. This is best achieved by local contacts and consultation in the area where the match is to take place.
    Mr. Sims: Does the Minister accept that one of the most effective ways of dealing with these hooligans, many of whom are aged between 17 and 21, would be to deprive them of their liberty and take them out of circulation on Saturday afternoon? Why do the Government turn their faces so firmly against expanding the number of senior attendance centres, of which there are only two at present, with no plans to extend them?
    Dr. Summerskill: There are 63 attendance centres in England and Wales. [HON. MEMBERS: "Not senior ones."] I am answering the question in my own way. There are 63 attendance centres in England and Wales covering the major areas of population, and the Government have made additional resources available for the expansion of the system.

    Police (Complaints)
    Mr. Litterickasked the Secretary of State for the Home Department if he remains satisfied with the operation of the new police complaints procedure.
    Dr. Summerskill: Yes. Sir.
    Mr. Litterick: Does the Minister accept that, although we on the Government Benches welcome the new police complaints procedure as a step towards making the police more accountable to the public, it now seems more difficult

    625
    for individual members of the public actually to bring a complaint against the police, since the way in which the new system works makes it necessary for victims of police violence to provide far more specific information—for instance, about the identity of their assailants—than was ever required before, and that this tends to check the flow of legitimate complaints against the police?
    Dr. Summerskill: I would prefer to comment on criticisms of the new system when we receive the first annual report of the board. It came into operation only on 1st June last year. That is a comparatively short period. We expect the report to be published on 4th May. We shall then be able to assess the success of its operations.

    Television Licenses
    Mr. Maddenasked the Secretary of State for the Home Department what representations in the last year he has received to give all retired couples, living alone, either television licences free or licences at half the licence fee.
    Mr. Merlyn Rees: One representation has been received in the last year advocating television licence concessions solely for retired couples living alone, but, as my hon. Friend knows, there have been a number of representations in favour of concessions for pensioners living alone. The Government are currently considering the question of television licence concessions in the light of the Annan Committee's recommendation that no further concessions should be introduced.
    Mr. Madden: Does the Home Secretary agree that many retired people living alone have a deep sense of grievance about the present arrangements whereby a small number of pensioners, living in certain types of accommodation, have a 5p licence while the vast majority have to pay the full rate? Does he not also agree that the cost of adopting the suggestion in my Question would be peanuts in national economic terms but would at the same time offer enormous assistance to a greater number of retired people living alone?
    Mr. Rees: My hon. Friend used the word "peanuts". Between £80 million and £90 million would be involved. That is about one-third of the licence revenue.
    626
    But we are considering the matter, and I am of a mind to make what might be regarded as a minor change concerning residential and sheltered accommodation which I shall be announcing very shortly.
    Mr. Bowden: Does the Home Secretary agree that any anomalies which are bound to arise from concessions would be far better dealt with by looking at the possibility of competely abolishing television licences for everybody?
    Mr. Rees: As the hon. Gentleman knows, this has been suggested many times, and that is what the annual report is about. We are considering that possibility, but we should not ignore the position that would then result whereby the BBC would receive its money direct from the Treasury. There is an aspect to consider there about the control of the BBC by any political party.
    Mr. Mendelson: Will the Home Secretary carefully consider the particular grievance of a large number of people, who have approved in principle the original concession, when they find that, although they live in very similar circumstances, they cannot be brought within the confines of the concession? If the Government were to decide not to abolish the licence fee altogether, would the Home Secretary consider reducing television licence fees by 50 per cent. for retired pensioners so that there was a feeling of equality among all those involved?
    Mr. Rees: My hon. Friend, in his concluding remarks, showed that once we embark on concessions there is a sense of grievance among many other people. Within the concessions that are made I shall be announcing very soon something concerning my hon. Friend's first point.

    Prisoners (Overcrowding)
    Mr. Goodladasked the Secretary of State for the Home Department what plans he has for reducing overcrowding in Her Majesty's prisons.
    Dr. Summerskill: As my hon. Friend the Minister of State explained on 2nd March, overcrowding, particularly in local prisons, is a matter of continuing concern. I hope that some relief will be afforded by building schemes already in progress, which are expected to provide 4,700 extra places by 1981–82, but much

    627
    will depend before then on the level of crime and the sentencing practice of the courts. Provision has also been made to start one new prison in 1981–82.
    Mr. Goodlad: Does the Minister accept that the present chronic overcrowding in prisons is effectively frustrating the aims of the prison service, other than in regard to pure containment, and that the effect on young offenders is particularly serious? Does he further accept that, in addition to the financial solution to which he has referred and the sentencing, much greater attention must be given to the use of non-custodial sentences for those who have been convicted of crimes such as maintenance default and others referred to by the Wootton Committee?
    Dr. Summerskill: It would seem that the House is generally agreed that non-custodial sentences should be encouraged. I am also glad to learn that the Opposition support greater public expenditure on prison establishments.
    Mr. Christopher Price: How many people are in prison at the moment who ought really to be in hospital, particularly psychiatric hospitals? What is the Home Office doing about this quite scandalous situation, to which the courts and others have drawn attention?
    Dr. Summerskill: I agree with my hon. Friend that there is a very great need for more secure accommodation for the mentally ill who commit criminal offences. Discussions are now going on between my right hon. Friend the Home Secretary and my right hon. Friend the Secretary of State for Social Services.
    Mr. Stephen Ross: Does the Minister accept that one way to reduce quickly the overcrowding in some prisons in this country would be to settle the dispute in Parkhurst, Albany and Camp Hill prisons on the Isle of Wight? When is Parkhurst Prison, which dates back to about 1840, likely to be modernised?
    Dr. Summerskill: I can assure the hon. Gentleman that every effort is being made to settle the dispute at Parkhurst, which can only be detrimental to both staff and prisoners. Parkhurst will be considered, along with the needs of all the other old prisons, for early expenditure.

    TUC AND CBI
    Mr. Skinnerasked the Prime Minister when he last met the Trades Union Congress and the Confederation of British Industry.
    The Prime Minister (Mr. James Callaghan): I met representatives of both the TUC and the CBI when I took the chair at a meeting of the National Economic Development Council on 1st February. Further meetings will be arranged as necessary.
    Mr. Skinner: Will the Prime Minister tell the trade union leaders that in her lust for power, the Leader of the Opposition will do almost anything? First, she stabbed her ex-leader in the back. Then she took elocution lessons. Then she moved the policy of the Tory Party on immigration towards the National Front. Then she was seen drinking whisky with the editor of the Tory newspaper, The Sun—
    Mr. Speaker: Order. The Prime Minister is not responsible for the Leader of the Opposition. The hon. Member for Bolsover (Mr. Skinner) may put questions only on those matters for which the Prime Minister is responsible.
    Mr. Skinner: Will my right hon. Friend therefore tell the Labour Party, both here and outside, that we shall fight the election not on expediency but on principles fashioned by the Labour Party and the trade union movement?
    The Prime Minister: The TUC and the CBI both understand this position. I find, in my discussions with them, that they are principally concerned with how best to co-operate with each other and with the Government in getting higher industrial production, making our way out of the world recession, and raising the standard of life of the people of this country as well as ensuring that there are good industrial relations. These are the matters that we usually discuss, and with very great effect.
    Mr. Fairbairn: Will the Prime Minister, when he speaks to the TUC and the CBI, remind them that they do not entirely represent, as they are claimed to do, the people of this country? They represent a very small fraction. Will he agree that it is those who work in small

    629
    businesses who are likely to achieve the production that we need?
    The Prime Minister: I find in my discussions with them that the CBI and the TUC would not claim any more than that they represent their own members. It is the responsibility of the Government to have the national interest as a whole in its charge. That is why I cannot always agree either with the TUC or with the CBI.
    Mr. Walter Johnson: When my right hon. Friend next meets the CBI and the TUC, will he, through them, convey the congratulations of this House to Sir Kenneth Keith and to all the workers involved at Rolls-Royce in achieving the massive order from Pan Am for the RB211? Does he agree that this magnificent achievement has been brought about by a nationalised company in fierce competition with private enterprise? Does this not reflect great credit on everybody concerned?
    The Prime Minister: Yes, Sir, I think it does, especially as I understand that the order was won on the technical merits of the engine, which goes to show that this country can still produce what is necessary against world competition.
    If we are to distribute the congratulations fairly—I have already written a personal note to Sir Kenneth Keith—we ought also to congratulate the Tory Party on nationalising Rolls-Royce.
    Mr. Budgen: When the Prime Minister next meets the TUC and the CBI, will he draw to their attention the leading article in The Times of today which predicts a 15 per cent. rate of inflation next year as a consequence of the increase in the money supply for the last 12 months? Will he remind them that there is in the circumstances no chance of a reflationary Budget which does not have the effect of increasing the rate of inflation?
    The Prime Minister: I read that very interesting article against the background of the knowledge that the leader writer, if I guess the style correctly, is a well-known monetarist. It seemed to me that he was sensationalising a little by annualising—that is, translating into an annual rate—the increase in money supply over the last three or four months, and that
    630
    would not necessarily be borne out over the full 12 months. However, I am having a study made of this proposition, because we should in no circumstances return to the bad habits of the Conservatives in 1972–73.

    SECRETARY OF STATE FOR ENERGY (SPEECH)
    Mr. Nicholas Wintertonasked the Prime Minister if the public speech by the Secretary of State for Energy in Bradford on 10th March 1978 concerning private ownership of farms, factories and banks, represents Government policy.
    The Prime Minister: My right hon. Friend's speech was more of a statement of philosophy than of policy, his theme being that democracy is the best safeguard of personal freedom and of values and that private ownership does not guarantee human freedom. He added that Socialism without democracy is no Socialism at all. These propositions seem to me to be borne out by historical experience and can be verified by current observation of the international scene.
    Mr. Winterton: Will the Prime Minister tell the House and the country in rather more principled terms why he allows the Secretary of State for Energy's repeated and very damaging calls for the nationalisation of banks, farms, land and factories to go unrebuked, particularly as the Prime Minister himself owns substantial land in Sussex? Is it not about time that the Prime Minister stood up and said that he opposes these pseudo-Marxist policies that are being pursued not only by his own party but within his own Cabinet?
    The Prime Minister: The hon. Gentleman clearly has not read my right hon. Friend's speech with the care that it deserves. I have studied it extremely carefully. I am grateful to the hon. Gentleman for bringing it to my attention, because I thought that the way in which my right hon. Friend portrayed the philosophy of freedom and democratic Socialism was excellent. If the hon. Gentleman reads the speech he will find that he has translated a negative about private ownership into a positive. I suggest that he reads the speech again.
    Mr. David Steel: Does the Prime Minister recall that the last time I questioned him about a speech of the Secretary of State for Energy he expressed the hope that we would take less of a morbid interest in the speeches of that right hon. Gentleman and more in his own? May I tell him that that advice appears to have fallen on deaf ears, since the only copy of this latest speech has disappeared from the Library? Without the benefit of the authorised version, may I ask the Prime Minister to confirm that so long as the Lib-Lab agreement exists none of these interesting ideas from the right hon. Gentleman is likely to see the light of day?
    The Prime Minister: I understand that it is the desire of the right hon. Gentleman—which I fully appreciate and approve of—in due course to resume the full independence of the Liberal Party. I cannot anticipate that we are likely to have a united manifesto whenever the call to the people comes. We shall devise our own manifesto in due course. I am sorry to hear that the only copy of the speech is missing. It must be a little grubby by now, because on looking at the Order Paper I see that we had six identical Questions from the hon. Members for Macclesfield (Mr. Winterton), Burton (Mr. Lawrence), Derbyshire, South-East (Mr. Rost), Chingford (Mr. Tebbit), Melton (Mr. Latham), and Brentwood and Ongar (Mr. McCrindle). I suppose the hon. Gentlemen concerned passed it around among themselves.
    Mr. Ashley: Now that it is clear that long-term changes in technology can have far-reaching implications for future generations—and can result either in economic prosperity or mass unemployment—will the Prime Minister consider setting up a Royal Commission to look into these changes and ensure that we are properly equipped for the future?
    The Prime Minister: This is a very important question. A lot of us had our attention drawn to it by that very remarkable programme on BBC 2 last weekend which reviewed automation and micro-circuitry. There is no doubt that this will have—indeed, is already having—a profound impact on our employment prospects for the mid-1980s. I shall certainly consider the suggestion that my hon. Friend has made, because I do not
    632
    believe that either here or in the other countries of Western Europe we have devoted enough attention to employment prospects in the next decade.
    Mrs. Thatcher: Will the Prime Minister now answer the point raised by my hon. Friend the Member for Macclesfield (Mr. Winterton) in his supplementary question? As the Secretary of State for Energy is known to want massive further nationalisation—and as Labour's programme includes demands for massive further nationalisation of banks, insurance, land, building, and many major industrial companies—will the Prime Minister say whether he accepts or rejects that programme?
    The Prime Minister: The right hon. Lady will be satisfied in due course—[HON. MEMBERS: "Answer."]—when the programme and policy of the Labour Party is published in full and the electorate is asked to decide on it. Until then, I suggest that the right hon. Lady waits in patience.
    Mrs. Thatcher: Why does not the Prime Minister give a straight answer to a straight question? As he is Leader of the Labour Party, presumably that is his programme, unless he repudiates it. Does he repudiate it?
    The Prime Minister: The issues on which the election will be fought in due course—indeed, it seems to me that in some ways it has already started—[HON. MEMBERS: "Answer."]—will undoubtedly appear, be printed and be discussed. I am bound to say that for anyone who believes in a mixed economy—as I imagine a number of us do on the Government side of the House but not on the Opposition side—the one phrase that caught the imagination of the people of this country—and which has undoubtedly influenced their attitude to public ownership—was what the former Leader of the Conservative Opposition said about the unacceptable face of capitalism

    PRIME MINISTER (ENGAGEMENTS)
    Mr. Cartwrightasked the Prime Minister if he will list his official engagements for 6th April.
    The Prime Minister: This morning I presided at a meeting of the Cabinet and

    633
    I shall be holding further meetings with ministerial colleagues. In addition to my duties in this House, I shall be meeting Dr. Waldheim, the Secretary General of the United Nations. This evening I hope to have an Audience of Her Majesty The Queen.
    Mr. Cartwright: Will my right hon. Friend give high priority to securing an expansion of world trade through a concerted and planned reflation in the industrialised economies of the West? Does he agree that that is a much more sensible solution to our economic problems than the sort of high profit/low tax panacea offered by the Leader of the Opposition?
    The Prime Minister: The expansion of world trade is one of the major factors that is concerning the leaders of the industrialised world at present—as to how far it can be stimulated and what part various countries can play in it. In my view there will undoubtedly be growth in the world economy this year. This is of very great importance to Britain because about 21 per cent. of our gross national product is represented by foreign trade. Therefore, if other countries are not growing economically our prospects for exports are to that extent diminished, and we want them improved.
    Mr. Gordon Wilson: Will the Prime Minister take time off today to examine the disgraceful episode that occurred on Monday of this week when a group of 20 managing directors and trade unionists, representing the knitwear industry in Scotland, attended a meeting in Glasgow which was not attended by two senior civil servants, who gave as their excuse for not turning up the fact that they did not know that there was a train service between London and Glasgow which took only five hours? In view of their ignorance and the fact that the Government have failed to provide employment in Scotland to merit the needs of the Scottish people, will the Prime Minister promote an amendment to the Scotland Bill to provide that economic and industrial powers are put into the hands of the Scottish Assembly?
    The Prime Minister: I am sure that my right hon. Friend the Secretary of State for Scotland will look into these complaints if, indeed, they are realistic, and will give the hon. Gentleman an
    634
    answer in due course. I do not propose to investigate it myself.
    Mr. Hooley: In his conversation with Dr. Waldheim, will my right hon. Friend make it clear that this country could not tolerate any attempt by the Israelis in South Lebanon which might prevent the 100,000 refugees who have been driven out of that part of the world from returning to their homes and taking up their shattered lives?
    The Prime Minister: I hope to have discussions with Dr. Waldheim about the position of the United Nations force in the Lebanon, and I shall certainly represent to him the need to ensure as far as possible that there is no contact between the PLO and the guerrillas and the Israeli border. It is important that there should be a clear separation. From then on, I hope that negotiations will be resumed quickly between Egypt and Israel.

BRITISH NUCLEAR TEST
Mr. Frank Allaun(by Private Notice) asked the Secretary of State for Defence if he will abandon the British nuclear test explosion scheduled for tomorrow at Nevada: and if he will make a statement.
The Secretary of State for Defence (Mr. Frederick Mulley): No. This test, which is due to take place tomorrow at the United States Department of Energy's test site at Nevada, is required in order to maintain the effectiveness of our nuclear weapons. In accordance with usual practice, an announcement will be made as soon as the test has taken place.
Mr. Allaun: Would it not assist the vital Anglo-American-Russian test ban talks if Britain set the lead by forgoing this test? What is the purpose of such a test if it is not a step towards a new nuclear weapon, which our Government have forsworn? The Government must realise that one does not need to test nuclear bombs to see whether they have gone stale like a piece of cheese.
Mr. Mulley: There is no one, and I repeat no one, more anxious to have a comprehensive test ban then myself and this Government. I made proposals to that end in Geneva as long ago as 1968.

635
If I thought for one moment that the British test would in any way deter that very desirable objective, we would not have the test. However, while other nuclear States are testing, there is no advantage in our forgoing one of the very few tests that we do have.
My hon. Friend asked me the purpose of the test. I have a great regard for my hon. Friend's sincerity and persistence on nuclear matters, but I do not regard him as the greatest expert on nuclear technology. I assure him and the House that we have no plans for any new generation of nuclear weapons. However, there is value in a test of this character.
Mr. Eldon Griffiths: Will the Secretary of State accept that his own credentials are impeccable, bearing in mind what he did in the ABC negotiations many years ago? Many people in this House recognise that the rapid build-up of Soviet nuclear strength demands that we should maintain the credibility of our nuclear capability. Therefore we support the tests.
Mr. Mulley: The sole purpose of the test is to maintain the effectiveness of our nuclear weapons.
Mr. Crawshaw: Will the Secretary of State assure the House that while we shall make every effort to bring down the level of armaments throughout the world, the Government will not do anything to place our Armed Forces at a disadvantage in respect of any other country?
Mr. Mulley: I am obliged to my hon. Friend. That is a very good summary of what I have been trying to do in my present office.
Mr. Hooson: I do not for one moment disagree with the hon. Member for Liverpool, Toxteth (Mr. Crawshaw), but does the Secretary of State appreciate that there is a great deal of anxiety in this country about nuclear tests of this kind? Will he give an absolute assurance that there is no intention of this Government's surreptitiously developing another generation of nuclear weapons, and that any decision will be made openly and after proper debate in this House? Will he assure us that this test is unconnected with any intention of that kind?
Mr. Mulley: I can give the hon. and learned Members that assurance. I have
636
said repeatedly that we have no plans for any new generation of nuclear weapons, and anyone who doubts that is doubting my integrity.
Mr. Fernyhough: Since this test is to improve the weapons that we already have, and since they are supposed to be enough to destroy the entire population of the world, what answer do we give to those nations that we are trying to persuade not to go for these weapons when they say that they want to acquire them, bearing in mind that we have them and want to deny them to other people?
Mr. Mulley: We entered into all these discussions during talks on the non-proliferation treaty. To put the matter into perspective, while there are no reliable official figures of the number of tests that have taken place, the Stockholm Institute's year book is a good guide, and it shows that we made only two tests between 1972 and 1976 out of the 185 recorded. Of these, 86 have been by the Soviet Union.
Mr. Luce: Is the Secretary of State aware that while we welcome any progress towards an international agreement to ban nuclear tests, we support, in the meantime, the British Government's duty to the British people to ensure that we preserve the operational efficiency of the British nuclear deterrent?
Mr. Mulley: That is the sole purpose of this test.
Several Hon. Members rose—
Mr. Speaker: Order. This is a Private Notice Question. We must move on.

BUSINESS OF THE HOUSE
Mrs. Thatcher: May I ask the Lord President to state the business of the House for next week?
The Lord President of the Council and Leader of the House of Commons (Mr. Michael Foot): The business for next week will be as follows:
MONDAY 10th April—Motions on the National Enterprise Board (Financial Limit) Order and on financial assistance to British Leyland Limited.
Motion on EEC documents R/3069/77 and R/3121/77 on farm structure.

637
TUESDAY 11th April—My right hon. Friend the Chancellor of the Exchequer will open his Budget Statement.
EEC documents R/1721/77, R/2080/77, R/2473/77, COM(77)640, the economic situation annual report, R/654/78 and R/655/78 will be relevant.
The Chairman of Ways and Means has named opposed Private Business for consideration at 7 o'clock.
Motion on EEC documents S/139/77, S/183/78, R/3375/11 and R/513/78 and the supplementary memorandum, on Community textile policy.
WEDNESDAY 12th April and THURSDAY 13th April—Continuation of the Budget debate.
FRIDAY 14th April—Private Members' Bills.
MONDAY 17th April—Conclusion of the debate on the Budget Statement.
Mrs. Thatcher: While recognising that we have some rather significant business next week, may I put two points to the Leader of the House? Will he make time very soon for a day's debate on Rhodesia, in view of the very important statements that are being made on both sides of the Atlantic? It is urgent for us to have a debate on this matter.
Secondly, he will recall that just before the recess he said that soon after we returned there would be a statement on how the Government proposed to proceed on the proposals of the Speaker's Conference on Northern Ireland. When can we expect that statement?
Mr. Foot: I very much hope that a statement will be made to the House next week. I do not know for certain on which day it will be made, but I shall notify the right hon. Lady about this.
On the first matter that she raised, I note the demand for a debate on Rhodesia. I cannot promise it in the immediate future. There was a debate on the subject prior to the recess, but I take note of the request that we should have another at a fairly early date.
Mr. James Lamond: Will my right hon. Friend ask somebody in the Government to make a statement next week about the Government's policy on the neutron bomb, because of the conflicting
638
reports published in the Press, and in view of the great importance of this decision and its impact on the success of the Special Session of the United Nations, which Dr. Waldheim emphasised last night in his speech to Members of this House?
Mr. Foot: I fully accept what my hon. Friend said about the widespread interest in the matter. I am not sure whether we should have a statement next week, but I shall notify members of the Government and my right hon. Friend the Prime Minister about what my hon. Friend and others have said on the subject.
Sir Frederic Bennett: May I revert to the request of my right hon. Friend the Leader of the Opposition for a debate on Rhodesia? Does the right hon. Gentleman realise that it is not good enough to remind us of the fact that there was an Adjournment debate on this matter before the House rose for the Easter Recess? Does he not appreciate that in almost every country in the world Governments and Parliaments are discussing a matter which is of British concern and for which we have responsibility—a fact of which the Government are constantly reminding us? Therefore, is it not time that this Parliament had the right to say what they think of the Government's handling of this matter?
Mr. Foot: I fully understand what the right hon. Lady said earlier about a request for such a debate, but the hon. Gentleman should not dismiss in such terms the debate that took place earlier. The subject was raised officially by the Opposition, there was a good deal of discussion of it, and it was an important debate. Account must be taken of that factor.
Mr. John Garrett: Will my right hon. Friend make time available to debate the radical report of the Expenditure Committee on the Civil Service and the Government's reactionary reply to it?
Mr. Foot: I might interchange the adjectives used by my hon. Friend. But whatever rearrangement might be made of that character—and obviously the matter must be debated in the House at some stage—we shall have to see what is the most convenient time to hold the debate.
Mr. Hooson: Will the right hon. Gentleman try to make time for a debate on the report of the Royal Commission headed by Lord Pearson about changing the basis of compensation for victims who suffer personal injuries? Does he recollect that during Question Time on this matter the Prime Minister said in answer to a question by me that he thought that it would be a good idea to have a debate this Session? Will the right hon. Gentleman try to facilitate such a discussion?
Mr. Foot: I shall certainly examine the proposition. It is right that there should be some time to consider the many important questions in the report. I shall take into account what the hon. and learned Gentleman and my right hon. Friend the Prime Minister said on the subject.
Mr. Ioan Evans: Will my right hon. Friend allow a short period of time next week to debate an all-party Early-Day Motion No. 356, dealing with the abuse of Press freedom by full-time officials of Plaid Cymru in relation to which the Western Mail in an editorial said that Members of Parliament in this House had been attacked by full-time officials and that signatures had been used which were not the signatures of those who actually signed the letters in question?
[That this House endorses the sentiments expressed in the Western Mail editorial entitled "An abuse of Press freedom", which appeared on Wednesday 5th April 1978, and which contained these words: "The Letters column of a newspaper is not there to be used, with deceit, by a political party in an attempt to further its own ends. But that is what officials of Plaid Cymru have admitted doing. Party employees have been writing letters to the Press (and broadcasting organisations), invariably on topics of current controversy, without declaring that they are, in fact, full-time, paid employees of the party. There are also reports that letters have been written above the signature of people who knew nothing about them (though who do happen to be members of Plaid Cymru). The affair smacks of the sort of dirty-trickery that is one of the less wholesome aspects of American politics. It is a piece of manipulation that shows up those who wrote the letters, and the party itself, in a most unpleasant light. In common
640
with other newspapers, the Western Mail has a set procedure to check the authenticity of contributions to its letter columns. To make our checks any more thorough would be impractical; therefore, a great deal has to be left to trust. It is a trust that has been rather cynically betrayed by Plaid Cymru. They have acted both immorally and dishonourably by insinuating political propaganda in the guise of genuine letters. Mr. Dafydd Williams's protestations yesterday that any attempt to discourage such activity by party employees would be a curb on the freedom of speech is a fatuous attempt at throwing up a smoke screen. It cannot disguise the fact that these letters were a deliberate attempt to mislead a newspaper, and therefore the public …"; and therefore calls upon members of Plaid Cymru who are honourable Members of this House immediately to disassociate themselves from this deceit practised by the General Secretary and other employees of the Party.]
Mr. Foot: I do not think I can promise a debate on the subject in the House next week. I think that it is a matter for the party concerned to make some response about it.
Mrs. Bain: Will the Leader of the House arrange for an early debate on the future of the Scottish shipbuilding industry, particularly in view of the fact that the Labour candidate at the Garscadden by-election has stated that there will be no redundancies on the Upper Clyde, whereas the Government have refused to endorse that statement?
Mr. Foot: I am sure that the hon. Lady will recollect that she and her party voted against the passage of the Bill, the provisions of which now give assistance to Scotland and without which the position would be very much more serious. Therefore, I am not sure whether such a debate would favour her party, but that is no reason why we should never have one.
Mr. Greville Janner: Is my right hon. Friend proposing to give time to introduce legislation to implement the recommendations of the White Paper dealing with company directors' duties, and in particular to create a new duty towards the employees of a company?
Mr. Foot: I cannot promise early legislation on the subject, but if my hon. and learned Friend is referring to the much wider question of how we may proceed on the subject of industrial democracy, we should like very much indeed to be able to proceed further in that direction, but we feel that we must have proposals that would carry us forward. We very much doubt whether we could get such proposals through in this Parliament.
Mr. Gow: Since it is now more than seven weeks since Mr. Speaker wrote to the Prime Minister reporting on the almost unanimous recommendations of the Speaker's Conference, why has there been such a long delay in the Government announcing their intentions? Why cannot the Leader of the House say that we shall definitely have a statement on this subject next week?
Mr. Foot: There is every possibility that we shall have the statement next week. Hon. Members will be able to appreciate the reasons why we have chosen this time. I hope that there will be little further delay in making the announcement to the House on the subject.
Mr. Hooley: When will the House have an opportunity to discuss the important subject of the special development order on Windscale and what the extent of that debate will be?
Mr. Foot: I cannot give a promise as to the exact time that it will take place, but I have taken note of Early-Day Motion No. 354 on the subject. I am sure that my right hon. Friend the Secretary of State for the Environment will also be taking note to see how we can take account of the matter.
[That this House welcomes the Secretary of State for the Environment's promise that the recommendations of Mr. Justice Parker, at the end of his Report on the Windscale inquiry, which deal with important steps to improve existing safety arrangements, will all receive the Government's careful attention and will be the subject of a statement, but insists that because of the importance of these recommendations to surrounding areas and to the Isle of Man, that the statement be made in sufficient time to be considered before the House is invited to
642
debate the Special Development Order on Wednesday.]
Mr. Jopling: I am glad to hear that the Leader of the House has seen that motion. Does he realise that the present printing dispute disguises the fact that the motion is supported by virtually all parties in this House, and by distinguished names on his own side? Does he appreciate the importance of the matter, and if he cannot arrange for a statement to be made next week, will he give an undertaking today that the statement will be made before we debate the special development order?
Mr. Foot: I cannot at this moment make a promise of a statement, but I can assure the hon. Gentleman that the Government—and especially my right hon. Friend the Secretary of State for the Environment, as he has proved to the House—have taken full account of the opinions expressed in all parts of the House on this subject. I do not believe that there is any hon. Member in any quarter of the House who would deny that the Government and my right hon. Friend have taken special precautions to ensure that the House will be able to give its views on this subject.
Mr. Urwin: Does my right hon. Friend appreciate that I sympathise with him in not being able to find time in the foreseeable future to debate the subject of industrial democracy, but can he say when we may expect to receive the White Paper on that subject, a document which was promised some time ago?
Mr. Foot: I know that my hon. Friend and others are awaiting a White Paper on that subject. We are seeking to produce it and to bring it forward as speedily as we can. I know that there has been some delay, but I hope that it will not be much longer.
Mr. Burden: The right hon. Gentleman no doubt will be aware that his right hon. Friend the Minister of Agriculture, Fisheries and Food has published a report on the export of live animals for slaughter. As there is so much interest in this subject, both in the House and in the country, will he give an undertaking that there will be a debate on that report in the near future?
Mr. Foot: I cannot give an undertaking in the exact form requested by the

643
hon. Gentleman, but I shall discuss the matter with my right hon. Friend and see what approach we can make in the House on the matter.
Mr. Hugh Jenkins: On the subject of the neutron bomb, my right hon. Friend will have noticed the attempts on television to bulldoze the Government into taking positive action on this matter. But, in view of the statement made by my right hon. Friend the Secretary of State for Defence that the Government have no intention of proceeding to a new generation of nuclear weapons, is that not a declaration of the fact that, if the Government have no such intention, they will have nothing whatever to do with the neutron bomb? Will he give the Secretary of State for Defence the opportunity to reaffirm that decision next week?
Mr. Foot: It is true that the Government will not be bulldozed into any decision or attitude on this matter in the way that has been suggested. That was made quite plan by the answer given by my right hon. Friend the Secretary of State for Defence a little earlier this afternoon.
Mr. Pym: Has the Leader of the House anything further to say about the non-appearance of parliamentary papers and, if he cannot make a statement today, will he make another statement early next week?
Mr. Foot: I was very much hoping that I would be able to make a statement to the House today, but I am sorry to have to say that we have not yet made further progress on the matter. I fully appreciate the concern of the House on the subject and I shall see whether on Monday we should make a statement. I do not in any sense minimise the concern of the House on this subject.
Several Hon. Members rose—
Mr. Speaker: Order. The House knows that there is an important statement on immigration to follow. I propose to allow three more minutes on business, and then we must move on.
Mr. Nicholas Winterton: May I refer the Lord President to the business which will come on late next Tuesday evening when we are to discuss the EEC documents on textiles? Is he aware that hundreds
644
of people in the textile industry are being made redundant each week because of unfair competition from abroad? Will he ensure that next Tuesday evening the Secretary of State for Employment and the Secretary of State for Trade are present in this House when these documents are debated, and will he give an assurance that a debate on textiles in the United Kingdom will be held at an early date?
Mr. Foot: I hope that there will be considerable time for the debate on Tuesday and that it will be of assistance to all hon. Members from textile constituencies who are concerned about this matter. As to which of my right hon. Friends will be responsible for answering the debate, that is another question, but I shall certainly pass on the hon. Gentle man's representations.
Mr. Edward Lyons: In view of the brutal and terrifying announcement by Thorn Consumer Electronics directors yesterday of firm proposals to close their Bradford television factories, with a loss of 2,200 jobs, in order to concentrate production in the South-East, will my right hon. Friend give time for a debate on this issue, particularly in relation to the laughing stock it makes of Government regional policy and in relation to the devastating effects on employment in Bradford and West Yorkshire?
Mr. Foot: I cannot promise an immediate debate on this subject, but I fully acknowledge the concern that my hon. and learned Friend has expressed and no doubt he and others of my hon. Friends will be making representations to the Government on the subject and we shall see how we can proceed from there.
Mr. Tim Renton: Bearing in mind the wishes of many of the right hon. Gentleman's parliamentary colleagues to abolish the House of Lords, does he agree that it is important for the House to know the views of the Government on the role and revising power of the Second Chamber? Will he therefore find time for a debate on this issue?
Mr. Foot: There are many things that we cannot do next week and one of them is to abolish the House of Lords, so we shall have to leave that over to a later date.
Mr. Flannery: I know that there is to be a statement today on the Select Committee's report concerning race relations and immigration, but, in view of the very great worries of the black and brown communities in this country, especially since the hardening of attitude by the Leader of the Opposition on this subject, will my right hon. Friend give us an opportunity in the near future to debate race relations, especially in view of the backwardness of the Select Committee's report?
Mr. Foot: I think that it would be best for the House first to await the statement from the Home Secretary. One purpose of that statement is to allay precisely some of those fears to which my hon. Friend has referred.
Mr. Critchley: Will the Leader of the House allocate an early day for a debate on the situation in the newspaper industry?
Mr. Foot: As the hon. Gentleman will have heard, there are many candidates and competitors for the debating time of the House and there are other opportunities apart from Government time for matters to be raised. However, I fully acknowledge that some of the events that have occurred in the newspaper industry in recent weeks are extremely serious for democratic institutions in this country and I certainly think that they ought to be debated at some stage in this House.
Mr. Robin F. Cook: Returning to the special development order on Windscale, may I ask whether my right hon. Friend is aware that when this matter had a full day's debate before Easter, a number of hon. Members were unable to be called to speak? In view of the complexity of the matter, surely it would be a travesty of debate if we were expected to reach a decision on the issue with only one and a half hours' debate.
Mr. Foot: Let us see how we proceed. Despite the fact that not every hon. Member who wished to speak was able to take part in the debate before Easter—and that is not an unprecedented state of affairs—we made special arrangements to ensure that the House should debate the matter, but I shall take into account the representations that my hon. Friend and others are still making on this subject. I
646
recognise that there is widespread interest in this matter and we wish the House to play a full part in dealing with it.

IMMIGRATION
The Secretary of State for the Home Department (Mr. Merlyn Rees): With permission, Mr. Speaker, I wish to make a statement.
I should like to draw to the attention of the House the Command Paper on control of immigration statistics for 1977, which is published today and which contains new information, in particular extensive historical tables showing the pattern of immigration over the past 10 years. The Government's detailed reply to the report of the Select Committee on Immigration will of course be published in the normal way as a White Paper. In the meantime, I should like to take the opportunity of relieving some anxieties that have been aroused recently.
Today's Command Paper on statistics shows a fall in both primary and secondary immigration. By primary, I mean the entry of heads of households, for example with work permits, and by secondary, the admission of their dependants. The total number from the new Commonwealth and Pakistan accepted for settlement on arrival fell from 37,000 in 1976 to 28,000 last year—a reduction of 25 per cent. This reduction supports the Select Committee's view that for some time there has been very little primary immigration from these countries, and I note that the Select Committee has not challenged the accuracy of the Home Office statistics on this issue.
We can therefore confidently say that, subject to commitments to United Kingdom passport holders under the special voucher scheme, which have been accepted and confirmed by successive Governments, and to those arising out of the Immigration Act 1971 and from our membership of the EEC,
"there will be no further major primary immigration in the foreseeable future".
The Government fully agree with the Select Committee conclusion that it is not equitable or practical to renounce previous commitments, and I can assure the House and those who would be affected that the Government have no intention of doing so.

647
The reduction in the immigration figures shows that there is no need to introduce a new specific annual quota. I think it important to reassure the immigrant communities on this point particularly in the light of the Select Committee's recommendation—which some have interpreted to mean quotas.
This recommendation appears in fact to have been aimed at giving greater priority to the admission of wives and children of those settled here. The figures for wives and children in the Command Paper show that the Government already give priority to them. But we accept that, where necessary, staff should be redeployed to enable even greater flexibility in giving such priority.
The Government share the Select Committee's view that, for educational and other reasons, children who, in any case, are going to settle here should spend their formative years in this country, and that where people have a choice, it is not in the interests of good race relations deliberately to postpone bringing them here until they reach working age. However, it is not the Government's view that where a child is born in the future to a wife abroad, the admission of the mother and child to settle in the United Kingdom should normally be limited to children under 12 years of age. We would not contemplate removing or refusing entry to, say, a 12-year-old girl of a family settled here. To do so would be inhumane.
The Government note the Select Committee's comments on a register of dependants and its inability to make a recommendation in support of the idea. The Government have reconsidered this matter, but remain of the view which I expressed when the report of the Parliamentary Group under Lord Franks was published:
"It is inherent in the only scheme which the Group thought feasible that a register would be discriminatory, would be incomplete in coverage, would involve long delay in implementation and would be very expensive, and it is clear that it could give no certainty about future numbers".
The Select Committee recommends that the Government should institute an independent inquiry to consider a system of internal control of immigration. This would mean identity cards for everyone and new powers to require their production
648
on demand. Such a major change in practice and power reaching far beyond immigration control would be objectionable in principle. In the Government's view, therefore, no useful purpose would be served by setting up an inquiry.
However, the problems of control to which the Select Committee and also the CPRS have drawn attention, particularly as regards illegal employment, are undoubtedly important. We had already taken action on this by opening discussions with the TUC and CBI about how to deal more effectively with illegal entrants and over-stayers who take work to which others are entitled. We shall pursue the discussions energetically and I shall report further to the House. Meanwhile, we shall continue to take vigorous action to enforce the immigration control. In 1977, more than 1,100 deportation orders were made and in addition nearly 500 illegal immigrants were removed.
Immigration is a part, but only a part, of the wider question of race relations. Those who have come to this country have contributed much to British life. They have the assurance that we will honour our commitments to their close dependants. The United Kingdom is now, and will remain, a multiracial society. Our overriding responsibility is to do all in our power to make it a harmonious one. We have no doubt that in this we have the support of the overwhelming majority of our fellow citizens. The Government are committed to this in their policies for employment, education, the inner cities and other matters. We seek justice and equality of treatment for all who live in this country. That is the purpose to which all of us in the House and the country should devote our energies.
Mr. Whitelaw: Is the right hon. Gentleman aware that his statement shows that basically he intends to do nothing in response to the Select Committee's report? We do not accept that as in any way satisfactory, and I shall make clear our detailed reasons for that view tomorrow.
Mr. Rees: I have said that out of some 30 recommendations we are not in favour of a quota or a register and that we are not in favour of internal registration. After all the talk that the Opposition have

649
made in the past few months, surely they could have at least said something in the House.
Mr. David Steel: On behalf of my colleagues I give a warm welcome to the terms of the statement. Will the right hon. Gentleman confirm that the White Paper, which has been published this afternoon, when summed up means that immigration has declined, is declining and will decline? Will he confirm that the trend of the figures this year demonstrates that that is likely to be so? Will he accept that the debate should now shift away from the relatively easy topic of numbers and move on to the much more difficult social problems of youth unemployment, housing and education in the deprived areas, which necessarily involve expenditure?
Mr. Rees: Yes, the right hon. Gentleman is right about the statistics. The new section shows the figures over a period of 10 years and deals with primary immigration. The figures deal with dependants and include interesting figures as a result of entering the EEC. The figures show that since we have joined the EEC fewer people have come from Europe to live in this country. The statistics bear investigation. They are new collected statistics.
The right hon. Gentleman is absolutely right to say that we should be putting our minds to the problem of race relations with a small—it will always be relatively small—population who were immigrants, or are the children of immigrants. That is what we should be concerned about. That matters, and I am glad that the right hon. Gentleman has at least supported what we have said.
Mr. Bidwell: Does my right hon. Friend agree that in view of what has been forthcoming from the Opposition it is a matter of urgency that the contents of the Select Committee's report—it is a wide study—and their full meaning are adequately debated in the House so that we can sort the facts from the fiction, which must further defuse the situation? If we can reach agreement between the two major parties, surely that is in the interests of race relations in Britain.
Mr. Rees: The Government will be publishing a White Paper. We shall be doing so as soon as possible. I am sure that my hon. Friend, who was a member
650
of the Committee, would be able to tell us straight away the difference between the fact and the fiction.
Mr. Dudley Smith: Is the right hon. Gentleman aware that his statement is deeply disappointing as it fails completely to grasp the widespread problem of illegal immigration, which has nothing to do with identity cards? Is he aware that one of the most important recommendations of the Select Committee—it was made totally unanimously—was that primary immigration to this country should be ended? Is he aware that at present the main source of primary immigration into Britain is the so-called male fiancé? Does he agree with the Select Committee that male fiancés should be put right at the end of the queue?
Mr. Rees: The hon. Gentleman is wrong in what he says about primary immigration. Fiancés are not part of primary immigration. The hon. Gentleman shows straight away how little he knows about the matter. Primary immigration is falling rapidly. It is not only of coloured people. It covers all people from all parts of the world. The hon. Gentleman has made a statement about fiancés that is directly contrary to the report that he signed. That is why I think the quicker we have a debate the better. There seems to be confusion on the Opposition Benches. The hon. Gentleman talks about massive illegal immigration but he does not have one bit of information to justify that. He is doing what he always does. He wants to make the situation worse than it is because he believes that it is worse.
Mr. Alexander W. Lyon: I congratulate my right hon. Friend the Home Secretary on a most splendid statement. May I remind him that in rejecting the bad recommendations of the Select Committee he has overlooked recommendations that should be drawn to the attention of the Leader of the Opposition—namely, that all existing caegories of black immigrants into this country should continue and, indeed, should be accelerated so that the 45,000 a year that the right hon. Gentleman thought to be too many should be increased to about 60,000?
Mr. Rees: I agree with my hon. Friend that a number of those who have spoken on this matter in recent weeks have spoken from incomplete facts.
Mr. Budgen: Does the right hon. Gentleman agree that the Select Committee's proposal that male fiancés should go to the end of the queue will create only misery and uncertainty in the immigrant community and that it is much better to follow the straightforward and honourable example of the Prime Minister when he was Home Secretary in 1968 and withdraw the right of male fiancés to come into this country?
Mr. Rees: The Select Committee said that subject to this review we should make no recommendations about husbands. I have said that with regard to fiancés we would be even more flexible in what we are doing in different parts of the world. As the Select Committee says, if priorities are changed there might be a marginal change, but on fiancés—whether male or female—the Government's view is clear. We have a responsibility, and if the hon. Gentleman does not agree he should consider what the situation would be in a European context if his policy were that of the Government.
Mrs. Hayman: Will the right hon. Gentleman reiterate that the Select Committee does not recommend any different treatment of male and female fiancés? Will he assure us that he will resist any pressure to return to discrimination against husbands and fiancés of British women which existed prior to 1974?
Mr. Rees: My hon. Friend is absolutely correct. There is no intention on our part to return to a discriminatory policy.
Mr. Higgins: Does the right hon. Gentleman agree that the latest figures confirm that it is not necessary to break our commitment to bring about a foreseeable end to immigration? Does he further agree that the imposition of a quota, far from accelerating an end to immigration, would actually delay it and would be inconsistent with the commitments which those on both sides of the House have given in the past?
Mr. Rees: I agree fully with what the hon. Gentleman has said and with what he put in his letter to The Times recently.
Miss Joan Lestor: I warmly welcome what my right hon. Friend has said about
652
the Select Committee's report. The reason that some of us have been critical of the report is that, for example, the hon. Member for Warwick and Leamington (Mr. Smith) and my hon. Friend the Member for Ealing, Southall (Mr. Bidwell) have already put different interpretations on their own recommendations. Does my right hon. Friend agree that when people talk about ending immigration it is a great pity that the Select Committee report repeats the error of many other discussions on immigration and discusses it mainly in the context of colour, ignoring the fact that there is a good deal of immigration, to which my right hon. Friend has referred, by those who are not coloured or identified by the colour of their skin? The effect of that on race relations and on black children born in this country is disastrous.
Mr. Rees: On the last point, I suggest that the statistics, at which I was looking before they were published, repay close investigation. As my hon. Friend said, people talk as if the immigration that is taking place were that of 10 or 15 years ago. It has changed very greatly. The statistics should be looked at.
I should like to be clear about the Select Committee's report. A report has been put before the Government by an all-party Select Committee. We shall give it the close attention that it deserves. What I have been saying today relates to those matters which seem to me to have caused the greatest concern and on which I felt the Government should make clear their view at an early stage.
Mr. Ronald Bell: Have we not been told for 15 years and more that immigration has declined, is declining and will decline? Is it not a fact that the total acceptances for settlement last year, when adjusted for the deferment of husbands, about which the Home Secretary will know, and with any reasonable allowance for illegal overstaying, amount, once again, as they have continuously for the past 18 years, to between 50,000 and 60,000? The Home Secretary has proposed to do nothing about that aspect. Does he realise that the concept of a multiracial Britain has no support outside a very small political circle and that the country wants to see something done about the inflow and the size of the community already here?
Mr. Rees: The hon. and learned Gentleman, when talking about what has been said about statistics in the past and so on, can have his own view. I have published comprehensive statistics which give the figures over the last 10 years. I suggest that the hon. and learned Gentleman reads and studies them. If he makes even the most conservative or radical estimate, whichever way he wants to put it, as to what might happen in future, I suggest that he will see that we shall have a very small immigrant population in this country. I have just returned from the United States of America. Considering what that great country has done in the face of its major problems in the last 10 or 15 years, I suggest that, if we cannot deal with our relatively small problem, we have no right to lecture the rest of the world. I believe that we should put our own house in order.
Mr. Ward: I should like to express to my right hon. Friend the appreciation certainly of my immigrant community of his rapid rejection of those proposals of the Select Committee which would have turned this country into something akin to the East European or Fascist States of which we have heard so much lately.
Has my right hon. Friend yet discussed with his right hon. Friend the Secretary of State for Social Services the question of the issuing of national insurance numbers which the Sub-Committee recommended should be dealt with as a matter of great urgency?
Mr. Rees: With regard to the first point, I say to those Members who jeered at what my hon. Friend said that, when we get to the pitch of everyone having to produce documents in a country such as ours, which I believe to be superior to those of Eastern Europe and South Africa, it is a matter not of jeering but of principle.
With regard to national insurance and the way that it was put in the report, we shall be looking at that matter. I am responding not to the Select Committee report, but to what my hon. Friend said. We shall be looking at that matter.
Mr. Montgomery: Are the Government bound by the resolution that was passed at the Labour Party conference in 1976, that the 1968 and 1971 Immigration Acts should be repealed?
654
Secondly, does the Home Secretary agree with paragraph 41 of the report of the Select Committee on Race Relations and Immigration:
"There are no reliable figures about immigrants now resident in the United Kingdom"?
If he agrees with that, does it not make a nonsense of his statement this afternoon?
Mr. Rees: The hon. Gentleman has got it wrong again. I am responsible for immigration figures. The report was concerned with immigration. Figures for those inside the country arise from the census report. We shall publish a White Paper on the census soon. Questions have been asked in the past. For the next census, an appropriate question will be asked. There is confusion in some people's minds between the two. There is no question but that we want the information to be able to carry out the proper education policies and so on.
With regard to the first point, what the hon. Gentleman said about the Labour Party Conference or what was in the manifesto is another matter. I want to get rid of the 1971 Act, and so do the present leaders of the Opposition. They voted for the 1971 Act. Not all of them voted at the time. I have no doubt that that was for very good reasons. The 1971 Act on patriality was an attempt to deal with nationality. It is for that basic reason that I want to get rid of the 1971 Act. It is easy for people to stand up and say "We want a new nationality law." I judge the people who want to do that on whether they have responded to the Green Paper that I published on that matter, because it is very complicated. The facile commentator on this matter simply stands up and says "We are going to have a nationality Act" but never says a word about what he would do about it.
Mrs. Dunwoody: Is my right hon Friend aware that we are deeply appreciative of his clear statement that the Select Committee's suggestion about carrying identity papers would mean the kind of police checks which are totally unacceptable to the majority of people in this country? Will he actively resist any attempt to give extra powers to police forces to check on immigrants at their places of work without having very clear evidence that some crime has been committed?
Mr. Rees: I am pleased that my hon. Friend agrees with what I have said.
On the question of illegal employment, she knows, because she was at the discussions that took place in the appropriate body in Europe, that there is concern about illegal employment. There is concern on the part of both the TUC and the CBI. We want to find a means of dealing with that problem which is not a creeping method of using identity cards. Illegal employment is a matter which should be dealt with. I tell the House firmly that it is our intention to find a scheme with which everyone will agree.
Mr. McCrindle: Does the Home Secretary accept that the genuine fears about immigration among the indigenous population can sometimes be mollified or reduced when the statistics relating to immigration are published? In those circumstances, is the Home Secretary satisfied that the frequency of publishing immigration statistics is satisfactory?
Mr. Rees: We publish them four times a year. We publish them once a quarter. We publish the annual figures. The annual figures this year give the 10-year historical survey. We publish enough figures. We are up against those people who do not understand or do not want to understand them.
Several Hon. Members rose—
Mr. Speaker: Order. I propose to call those hon. Members who have already been standing. Mr. Flannery.
Mr. Flannery: Did my right hon. Friend notice the appalling and sickening unanimity of silence on the Opposition Benches when he was making his principled and honourable statement? Is it not a measure of how far we have to go in having a humane and compassionate view about coloured people in this country? Will he accept from me, and from these Labour Benches, the congratulations of all of us on that report, which is an immense contribution to racial harmony in this country? I hope that some hon. Members opposite will accept it for the contribution that it is.
Mr. Rees: I am grateful to my hon. Friend for his comments. Sometimes this place, by the nature of the line down
656
the middle of the Chamber, is not the best judge. I know that many Opposition Members—we shall find out when the speeches are made tomorrow—are concerned about race relations. Whatever divides us on matters of this kind, it is my job to get consensus, and I shall do my part.
Mrs. Bain: In view of the assurances given today that we shall honour our commitments to dependants, will the Home Secretary look carefully at the recent evidence given by Strathclyde Community Relations Council? Is he aware that a very extensive survey undertaken on the Indian sub-continent shows that, where dependants have been refused entry to the United Kingdom, the level of success of appeals was the lowest throughout the whole of the United Kingdom and that this is causing a great deal of concern to a well-integrated and very harmonious community in the West of Scotland?
Mr. Rees: I understand the successful aspect of race relations in Strathclyde. If the hon. Lady would like to have a word with me or the Under-Secretary of State, of course we shall look at that matter. But I must make it clear that, in terms of looking at the information and at the points of entry from the Indian subcontinent or anywhere else, it is the job of entry officers to be absolutely satisfied that the information is correct.
Mr. James Lamond: Is my right hon. Friend aware that his excellent statement will bring reassurance to all my constituents in Oldham, East, when it is properly understood, and in particular to the many thousands of immigrants who live there? May I ask my right hon. Friend whether the remarks he made about redeploying staff more flexibly will mean that the lengthy periods of waiting for interviews in such centres as the one at Dacca in Bangladesh will be reduced?
Mr. Rees: I cannot give an answer in respect of each entry control post. Certainly the greater flexibility could well mean that there will be a reduction in the waiting period. It is not, perhaps, generally recognised that the implication of many of the recommendations in the report is an increase in the amount of immigration, in the short run, at some ports of entry.
Mr. Stanbrook: Will the right hon. Gentleman cut out the eyewash about commitments and come clean with the British people and be specific about what he means? Is it not a fact, for example, that the only legal commitment is to the wives and young children of immigrants who have already settled here before 1st January 1973 and that the only moral commitment that matters is the interests of the British people here as a whole?
Mr. Rees: I am sorry that the hon. Member describes what I have said as eyewash because I have used exactly the same words as have been used by the Leader of the Opposition and other Opposition Front Bench spokesmen. The hon. Gentleman is, therefore, disagreeing with people other than me. He misunderstands the situation. The 1971 Act contains certain commitments. The hon. Gentleman will remember that when the rules were put to this House by a Conservative Home Secretary, they were turned down because a number of Conservatives voted with the then Opposition. Rules also have the force of law—
Mr. Stanbrook indicated dissent—
Mr. Rees: The hon. Gentleman cannot just shake his head. Rules were approved by this House. Whether in the Act or in the rules, there are commitments and this Government will stick by them.
Mr. Greville Janner: Does my hon. Friend not think it a pity that the right hon. Member for Penrith and The Border (Mr. Whitelaw) has preferred not to give his views to the House today but rather to reserve them for Leicester tomorrow? May I thank my right hon. Friend for providing the facts today so that the fictions of tomorrow will be obvious?
Mr. Rees: I have much greater faith in the right hon. Gentleman because I think that when he speaks tomorrow night what he says will be very close to what I have said.
Mr. George Gardiner: Is it not the case that there will be a general suspicion that the only reason why this statement was made today is that tomorrow the Conservative Party proposals to deal with this matter will be published? The Home Secretary claims that there has been a 25 per cent. reduction over the past year.
658
Can he give any guarantee that this rate of reduction will be continued?
Mr. Rees: That is why the figures for the past 10 years have been given. They show variations, for particular reasons. The hon. Gentleman knows, from his journalistic experience, that there can be no guarantees about numbers. Everything in those statistics shows that the decline in primary immigration—which has been going on for some time—and in secondary immigration, will go on. The hon. Member says that the statistics were published today because of a speech to be made tomorrow. I am glad that a month ago I arranged for these figures to be published today. It shows that one can be lucky sometimes.
Mr. Clemitson: Reverting briefly to the question of nationality laws, mentioned in the Select Committee report, may I ask what constructive suggestions my right hon. Friend has received on this subject from the Opposition?
Mr. Rees: To answer the question directly, none.
Mr. Townsend: Is the right hon. Gentleman yet able to recognise that the problem into which the Government have got themselves on immigration has largely arisen from their two amnesties for illegal immigrants and from their general relaxation of the immigration rules when they first came into power? Does the Home Secretary appreciate that the Government's reaction to this all-party Select Committee will be found disappointing by people throughout the country?
Mr. Rees: I cannot help the hon. Gentleman on his last point. He must read the Select Committee report and the figures. As for the amnesties for those who entered illegally before 1973, the hon. Member must offset against that factor the figures I have given for deportations every year and for administrative removals from this country. It is not the case that there has been any failure in that respect. I believe in a firm immigration control. Matters are firmly handled. I also believe that if we talk always about this matter we shall forget the major problem that concerns a small immigrant community. We need to deal with that. It is being dealt with

659
in other parts of the world. We should put our minds to it as well.
Mr. Molloy: Is my right hon. Friend aware that he bears a heavy responsibility in that he has to acknowledge that there are many members of the Conservative Opposition who want to represent this matter as a racialist issue and to frighten the ordinary people of this country by talking about the nation being swamped, in the hope that they will get some political gain? Is my right hon. Friend aware that if such people were to succeed there would be grave repercussions throughout the world and Great Britain would be marked as a racialist nation? May I beg my right hon. Friend to pursue the arguments he has pursued this afternoon so that people can understand the situation and not be misled by some of the racialist attitudes which have been exhibited in the House today and which will probably be exhibited in other parts of the media in the weeks to come?
Mr. Rees: As for the nation being swamped—I believe that that word has been used by an Opposition Member—the figures today show clearly that we are not being swamped. Anyone who gives that impression is wrong. That is why the figures have been published in this form. The figures speak for themselves. Any changes in policy need to be related to the fact that the sort of immigration that we had in the 1960s is over.
Mr. Edward Lyons: Does my right hon. Friend confirm, in his general argument, that, for example, the total number of West Indian immigrants accepted for settlement on arrival in 1977 was down to 131? Does he also confirm that emigration figures for immigrants do not exist and that what we are getting are mixed figures? Does he confirm that Bangladesh has fewer than 3,000 admitted for settlement annually, on the basis of the 1977 figures, and Pakistan 3,700? Do not these colossal reductions over previous years show that there will virtually be an end to immigration without any question of quotas and so on? What is the right hon. Member for Penrith and The Border (Mr.
660
Whitelaw) going to say tomorrow, when he announces his policy, about quotas for West Indians and fiancés when there was only one male West Indian allowed in for the purpose of marriage during the whole of 1977?
Mr. Speaker: Order. The hon. and learned Gentleman was called to ask a supplementary question.
Mr. Rees: I am grateful to my hon. and learned Friend for summarising the points that I have put. He represents part of the Bradford area. The figures for the small number of people coming in from the West Indies do not tell the other side of the story. There is an impression—I cannot say more than that—that a large number of West Indians are now returning, when they retire, to the country from whence they came.

IMMIGRATION
  BILL PRESENTED
    SOCIAL SECURITY (KIDNEY PATIENTS) (No. 2)
    Sir George Young, supported by Dr. Gerard Vaughan, Mrs. Lynda Chalker, Mr. Tony Newton, Mr. Phillip Whitehead, Mr. George Younger and Mr. Peter Morrison presented a Bill to authorise payment from the National Insurance Fund to persons receiving kidney dialysis treatment of an allowance equivalent to attendance allowance; And the same was read the First time; and ordered to be read a Second time upon Friday next and to be printed [Bill 101].

STATUTORY INSTRUMENTS, &c.
Mr. Speaker: By leave of the House, I will put together the Question on the two motions relating to Statutory Instruments.
Ordered,
That the Fishing Boats (Faroe Islands) Designation (No. 2) (Variation) Order 1978 (S.I., 1978, No. 490) be referred to a Standing Committee on Statutory Instruments, &c.
That the Magistrates Courts (Forms) (Amendment) Rules 1978 (S.I., 1978, No. 146) be referred to a Standing Committee on Statutory Instruments, &c.—[Mrs. Ann Taylor.]

ORDERS OF THE DAY

  INDEPENDENT BROADCASTING AUTHORITY BILL
  Order for Second Reading read.
  4.29 p.m.
  The Under-Secretary of State for the Home Department (Dr. Shirley Summer-skill): I beg to move, That the Bill be now read a Second time.
  The limited purposes of the Bill are twofold. First, it will extend the life of the Independent Broadcasting Authority—which would otherwise expire on 31st July 1979, now just 16 months away—by nearly two and a half years to 31st December 1981. Secondly, it will remove certain difficulties to which subsections (2) and (5) of Section 4 of the Independent Broadcasting Authority Act 1973 could give rise in relation to the Authority's broadcasts of parliamentary proceedings.
  It was announced in the Gracious Speech at the opening of Parliament that the Government would be bringing forward proposals for the future constitution, structure and organisation of broadcasting in the United Kingdom. These proposals, which my right hon. Friend hopes to present in the form of a White Paper, are now being formulated in the light of the report of the Committee on the Future of Broadcasting under the chairmanship of Lord Annan and of the many comments we have received on the committee's recommendations.
  It is clear that there is no prospect of legislation during the present Session to implement those of the Government's proposals which will be appropriate to legislation, in particular to provide the statutory framework for the future of independent broadcasting. Indeed, this legislation could not be on the statute book much before the middle of 1979, by which time the life of the IBA and its contracts with the independent television and local radio companies will have expired or be on the point of expiry.
  It would be manifestly undesirable to leave an industry employing some 13,000 people and with a turnover of some £300 million a year any longer in a state of uncertainty about its future, at any rate in the short term. The Bill accordingly
  662
  proposes an interim extension of the IBA's life for a period of nearly two and a half years beyond 31st July 1979. This will enable the Authority to continue to provide the television and local radio services for which it is responsible, pending the publication and parliamentary consideration of the Government's proposals on the future structure of broadcasting and the implementation of our decisions.
  It may be helpful if I explain why we are proposing an interim two and a half years' extension. Obviously, we need a realistic extension. Equally, however, the extension must not be so long as to be likely to defer unnecessarily the implementation of decisions on the future structure of independent broadcasting. The Government consider, on the basis of information from the IBA, that a period of between one and two years from the new legislation's receiving Royal Assent would be needed by the Authority to complete the procedures—which the Authority envisages would include public hearings, as recommended by the Annan Committee—for awarding, on the basis of the new legislation, programme contracts and for these contracts to be able to come into operation.
  If one were thinking in terms of this legislation reaching the statute book in, say, mid-1979—and I am not anticipating what will be in the Gracious Speech at the opening of next Session—it would not be reasonable to think in terms of the new programme contracts coming into operation earlier than during the course of 1981. It is for this reason that Clause 1 of the Bill proposes an interim extension of the life of the IBA from 31st July 1979 to 31st December 1981.
  I turn now to the amendments which Clause 2 proposes to Section 4 of the Independent Broadcasting Authority Act 1973 in relation to the broadcasting of parliamentary proceedings by the IBA. The main difficulty to which Section 4 could give rise in relation to parliamentary broadcasting by the IBA arises from subsection (2). It is a difficulty to which attention was drawn in paragraphs 48 and 49 of the Second Report of the Joint Committee on Sound Broadcasting.
  The problem is that, unless parliamentary broadcasting is removed from the scope of Section 4(2), this subsection could be construed as requiring the IBA

  663
  to exclude from its parliamentary broadcasting any expression of opinion on
  "matters of political or industrial controversy or relating to current public policy"
  by an hon. Member—or by a noble Lord in another place—who is a director of an independent television or independent local radio company. The amendment to Section 4(2) proposed in Clause 2 is in line with the recommendations of the Joint Committee.
  There are other circumstances in which Section 4(2) could give rise to difficulties. It could be construed as requiring the IBA to exclude parliamentary speeches, or parts of speeches, by any hon. Member or noble Lord in which reference was made to the opinions on the matters in question of directors of independent television or independent local radio companies or to the opinions on those matters of the Authority itself or its members or officers.
  When we were considering the Joint Committee's recommendation on Section 4(2), we realised that Section 4(5) could also create difficulties. It would require the previous approval of the IBA to the inclusion in a parliamentary broadcast of a speech, or part of a speech, by an hon. Member or noble Lord in which reference was made to the needs or objects of a charitable or benevolent organisation. It seemed to us inappropriate that the approval of a statutory body, a creature of Parliament, should be required in relation to the inclusion of such matters in a parliamentary broadcast. Clause 2 accordingly proposes the removal of parliamentary broadcasting from the scope of this provision.
  Now that regular parliamentary broadcasts have begun, the difficulties to which subsections (2) and (5) of Section 4 give rise now face the IBA. The difficulty with Section 4(2) cannot be overcome until the Bill has received Royal Assent, and it is for this reason that I hope that its passage will be speedy. Although the inappropriateness of Section 4(5) in relation to parliamentary broadcasting cannot be overcome until Royal Assent, I understand that the IBA has decided, pending the consideration of the Bill in Parliament, to grant prior approval in general terms to the inclusion of items of the kind covered by Section 4(5) in parliamentary
  664
  broadcasts. Thus any practical difficulties to which this subsection could give rise are avoided.
  I commend this most modest of Bills to the House. If hon. Members have points that they wish to put to me about the Bill, I shall try to reply at the end of the debate if I catch the eye of the Chair.
  4.38 p.m.
  Mr. William Whitelaw: I accept that in the circumstances in which we find ourselves there is no alternative to the Bill. We shall therefore support it.
  It is also important to appreciate that merely prolonging the present position of the IBA until 31st December 1981 does not preclude any action that might subsequently need to be taken on the recommendations of the Annan Committee.
  Certainly, the temporary nature of the Bill makes is virtually impossible in practice, as the Under-Secretary recognised, to change any of the franchises in the next two years. That will naturally be welcome to the existing companies and in many ways may well be for the best.
  The second purpose of the Bill, to regularise the position of independent radio in the broadcasting of parliamentary proceedings, is clearly essential in the circumstances. It is perhaps particularly welcome to those hon. Members who, like me, have long believed in sound broadcasting and who, contrary to what I know the majority of hon. Members feel at present, believe in the televising of the House as well.
  None the less, I must tell the hon. Lady that it is very unsatisfactory that we should be debating the Bill without the promised Green Paper or White Paper announcing the Government's conclusions on the Annan Committee's recommendations. After all, the Annan Committee reported over a year ago. Surely, even the present Government should be able to make up their collective mind in that time.
  In the debate in the House on 23rd May last year, the Home Secretary said that when the period of consultation ended in July last year he would take stock and announce his proposals. After eight months, however, the right hon. Gentleman is apparently still taking stock. Last month, at Question Time, the Minister

  665
  of State tried to reassure me about the delay by pointing out the number of recommendations in the Annan Report which had to be considered. Fortunately, I am either too old a hand or too well informed to fall for that story. I am certainly not alone in that. It is an open secret that the Home Secretary and his colleagues cannot reach any agreement on the Annan proposals. That is not surprising in this divided Cabinet and Government, but it is none the less profoundly depressing and unsatisfactory.
  I am sure that the Under-Secretary of State and, I trust, her right hon. Friend, realise how important it is to have the Government's proposals so that the House and the country have the basis for an informed debate, leading to decisions which are important for the future of broadcasting.
  We shall be failing the viewers and the broadcasters if, after a report as important and well-argued as that of the Annan Committee, not only is nothing done but the House and the Government appear to be doing absolutely nothing about it.
  It has to be said that we in the House can act only if the Government, so long as they have responsibility, are prepared to give the lead which so far they are totally incapable of giving. I hope, therefore, that we shall soon have a White Paper or a Green Paper on the Government's proposals. I hope that the hon. Lady will give a reply today indicating a publication date. That is important. We are being asked to go on for a long time, and the Government are treating the House and the country unreasonably. It seems to be appropriate to reserve further comment on Annan's major recommendation for change until the debate on the White Paper, if it ever comes at all.
  I want to use the debate for some comment arising out of Annan's opinion and expressed view that we in this country have discovered the secret of regulating our broadcasting through independent authorities while preserving editorial independence. I always regarded that part of the Annan Report as extremely important and valuable. I entirely agree with it. We in the House have our part to play in appointing the independent authorities through the Government, and, indeed, in sacking the board members if
  666
  we believe that proper standards are not being maintained.
  Since we are establishing in the Bill one of the independent authorities—the IBA—this must be the correct moment for us to make some comment on the quality and standards of broadcasting and its control. I shall put forward a few views of my own, which will be more in the nature of suggestions for consideration by programme planners and editors than basic criticisms. In general, I believe that the authorities perform their function. I admire the way in which they do not. But that does not mean that one is not entitled to express one's views and doubts about some of the programmes that go out.
  First, I wish to refer to the coverage of international events. Of course, I understand the difficult of filming in countries which are under totalitarian regimes, but the result of not being able to do that is that inevitably in many programmes there is a considerable lack of balance in coverage of international events. The alleged faults of Western democratic society are constantly exposed, whereas the undoubtedly infamous situations in some totalitarian countries are seldom, if ever, shown to viewers in this country. Surely, strenuous efforts must be made to right this balance.
  Equally, in view of the Foreign Secretary's forthright words last night, I must say that the coverage of Russian and Cuban incursion into Africa, and into the Horn of Africa in particular, which is clearly a development of importance to us and to all Western nations, has, for some reason which might be understandable, been receiving inadequate coverage.
  Mrs. Gwyneth Dunwoody: The right hon. Gentleman has made a general charge and followed it up with a specific instance. Will he read the section of the IBA's report which deals with complaints and tell us exactly where the lack of balance lies?
  Mr. Whitelaw: I make a general point. I do not make it in a basically critical way. I make it as a comment which is widely felt. If I were to make specific criticisms, I agree with the hon. Lady that I should have to substantiate them, but I am making a general point about the need for balance. I think that I am entitled to do that. If one looks at the programmes over a period of time, one

  667
  finds that there is a lack of balance. It does not matter where the totalitarian regimes are. The hon. Lady condemns some of them assiduously. I agree with her. In some of those countries we do not have the coverage. We should consider whether we are able to achieve a greater balance in this respect.
  I should like to pay a special tribute to the way in which Ulster Television has handled the terrorist sitution in Northern Ireland. I know of this from past experience. Its coverage of a difficult situation has been quite exceptionally good and it is worthy of the commendation of the House and of everyone who has been concerned with this unhappy problem. I only wish that I could say the same about all the programmes about Northern Ireland that have come from other companies on this side of the Irish Channel. Alas, I cannot.
  That brings me to violence on television. I am convinced that both the IBA and the companies are sensitive to the reports that youngsters are influenced by violence on the screen and that it might have a contributory effect on juvenile crime. One can only say to the authorities that, if they are in doubt about any programmes on this count, they should always err on the side of caution. If that is true of violence, it is also true of sex. I do not suggest that there should be a totally puritanical attitude which is out of touch with reality, but we should have a sensible approach to these problems.
  I am surprised, and perhaps many other hon. Members are surprised, at the volume of criticism that one receives about bad language on the screen. I am surprised at receiving more complaints about bad language than about violence and other problems. I do not believe that it is particularly necessary on the screen, and I hope that steps will be taken to remove it since it does not contribute to the programmes.
  I reaffirm my support for the present system. The Government, with the backing of the House, should exercise power in the appointments to the IBA. That board must exercise a powerful influence on the ITV companies to maintain standards. If views are expressed in the House and supported in the country, they should be respected, and the Government
  668
  have the basic responsibility overall to exercise their power in that respect.
  Mr. Clement Freud: Does the right hon. Member feel that the Home Office is the right Department to oversee broadcasting, or might not the Milk Marketing Board do it better?
  Mr. Whitelaw: I believe that the Home Office is the right Department, and I think that it has done the job extremely well over a period of time. That statement, coming from me to the Department, will no doubt be gratefully received.
  This House has the undoubted right, when it comes to prolonging the life of the IBA under the Bill, to press the Government on this issue. It is the Government's basic responsibility on the question of standards to respond to that pressure.
  Against that background, I hope that the House will give the Bill an unopposed Second Reading and a speedy passage through the House. However, I urge the Under-Secretary once again to tell the Home Secretary that he must produce his White Paper or Green Paper containing the Government's propsals on the Annan Report as soon as possible. It is unsatisfactory to go on postponing major decisions on the future of broadcasting. The IBA and particularly the BBC need longer-term security if they are effectivly to perform the functions placed upon them by the House. It is the duty of the Government, backed by us, in the interests of the viewers and the broadcasters, to give such assurance to those two organisations. As we pass the Bill, as I trust we shall, let the Home Secretary reflect on the extent of his and his Government's failure to meet this basic and very important requirement.
  4.52 p.m.
  Mr. Austin Mitchell: I declare an interest as a director of a commercial radio station—Bradford Community Radio Ltd.—and an unpaid director, I may add.
  Debates of this nature are at times a little unsatisfactory, partly because there is no adequate focus—and this brief Bill provides very little focus—but also because we as Members are not true consumers of the radio or television programmes that we talk about. There can be few groups of citizens who watch television or listen to radio less than we

  669
  do. Some of us watch only when we ourselves are on, and our main complaint seems to be that that is not often enough.
  Let us take the case of radio. Over one-quarter of adults in the country listen to commercial radio in the course of the week. The figure is more than 40 per cent. in the areas where commercial local radio is available, but we Members listen to it hardly at all, and, if anything, we have a peculiar distaste for its staple of pop music. Perhaps that is because pop music provides such effective competition for the kind of broadcasting we provide. I hope that we shall provide more formidable competition to pop music.
  Having thus skilfully won the sympathy of my audience, let me develop one point. Independent television and radio are two industries which in one sense are unique in Britain. The Government are preaching investment and expansion to every other industry in the country, but here are two industries which should and could expand, because the popular demand for them exists, but which have been held back by prolonged indecision.
  To demonstrate the demand, let me quote from a public opinion poll in the Sun two days ago which was produced on page 15, so that I was actually able to read it, and which showed that 73 per cent. of those interviewed favoured a fourth television channel. The indecision has been produced by the Annan Report, and its proposals have to be knocked down and eliminated before we can get on with the serious job that has to be done in the industry.
  It is now time for us to write the epitaph of the Annan Report. It can best be expressed, I think, with the words:
  "Not a drum was heard, not a funeral note,
  As his corse to the rampart we hurried;
  Not a soldier discharged his farewell shot"—
  except my hon. Friend the Member for Derby, North (Mr. Whitehead)—
  "O'er the grave where our hero we buried."
  There has been prolonged dithering over the fourth channel, but we should be talking not about the fourth channel, but about the fifth and sixth channels which could be secured by re-engineering the vhf frequencies. There are extra channels that could be secured from cable and satellite transmission.
  670
  It is interesting that a place like Columbus, Ohio, which has about the same population as Leeds in Yorkshire, has 33 channels from which consumers can choose.
  Mrs. Dunwoody: Has my hon. Friend ever seen what is on those 33 channels in Columbus, Ohio?
  Mr. Mitchell: I have not seen the channels in Columbus, Ohio—
  Mr. Michael English: My hon. Friend the Member for Crewe (Mrs. Dunwoody) is an eminent and honourable Lady, but I doubt whether even she has seen all 33 channels at the same time.
  Mr. Mitchell: I am having to cope with 33 interruptions, that is for sure. However, 33 channels give far greater freedom of choice than our television viewers enjoy in this country. I want to extend that freedom of choice. I have not seen the channels in Columbus, Ohio, but I have seen them elsewhere and they provide an extraordinary range. That is the range that the consumer wants, and it is pathetic for us to be dithering about a fourth channel when we could easily have many more channels.
  The solution about where the fourth channel should go is straightforward. It should go specifically to the IBA, which would control and manage it. I know that some of my hon. Friends here today will feel a distaste at handing over a fourth channel to the moguls of ITV. It is, of course, right to be cautious, but a decision in that direction is the only one that will allow rapid expansion of the industry. We want that rapid expansion.
  Mr. Michael Morris: Does the hon. Member feel that these channels should be handed to the IBA or to the existing ITV companies?
  Mr. Mitchell: It is good to know that I have the attention of my audience. I said that it should be handed specifically to the IBA to control and manage.
  Mr. Leslie Spriggs: It appears that there are some first-class public relations officers in the House today, and they are doing their stuff. I hope that the country will be saved from them. Is my hon. Friend aware that I sent a research worker to Canada and

  671
  that, judging from the message coming back concerning the content of television there, I feel justified in saying "God save this country from that"?
  Mr. Mitchell: I hope that the research from Canada is more relevant than my hon. Friend's interruption.
  As well as allowing for rapid expansion, a decision along the lines I suggest would provide the new boost that the industry desperately needs. In the 1950s the industry had the boost of ITV and in the 1960s it had the boost of BBC2. It has had no boost in the 1970s. It is a middle-aged, log-jammed, deadlocked industry which has the capacity to expand but is not being allowed to do so.
  Mr. Phillip Whitehead: My hon. Friend is advancing two contradictory propositions. The first is that the companies want to expand and cannot. The second is that we should hand this channel to the IBA, which would guarantee expansion. Surely the IBA could run the channel separately, which would be expansion of a quite different kind.
  Mr. Mitchell: If my hon. Friend had waited, he would have heard my explanation of how the channel was to be managed.
  Such a decision would be a boost not only to the companies but to independent production units and to the industry generally which would cater for the new channel. IBA control would allow existing contractors and independent producers to produce programmes for the new channel. That would secure the advantages that were sought in the Open Broadcasting Authority, but not the disadvantages. That is the strongest point of my suggestion.
  The most important reason for handing the channel to the IBA is that that is the only way in which we shall secure the complementary programming that will allow the consumer the freedom of choice between programmes that he should have. If the channel is handed to a third competing organisation, there will be two choices. Either it would become a minority channel, which would not secure advertising, or it would have to get in there and slug it out with popular programmes.
  672
  However, if we handed the channel to an institution which already controls one channel, that institution—the IBA—could allow a choice of viewing by ensuring serious programming on one channel and popular programming on the other, to give the audience the kind of freedom of choice which I think it must have in the present situation. That, the OBA could not do.
  There is a strong case, therefore, tot handing the fourth channel not to the companies but to the IBA and allowing the companies to compete with others to submit programmes to that channel.
  Mr. Wyn Roberts: There is of course, a powerful fillip to the hon. Gentleman's argument about expansion in that the expansion can be achieved only by the IBA without cost to the elector/taxpayer.
  Mr. Mitchell: I thank the hon. Member for reminding me of a point in my argument that I had left out through reading my notes too quickly.
  I turn now to radio. I think that commercial local radio has been a major success story over the last four years. We now have 19 stations, all with substantial audiences, and all are listened to each week by a substantial proportion of the population. Many of them are listened to by over half of the local population for between 10 and 14 hours in the average week. These are major success stories. Most of them are the most-listened-to radio stations in their areas.
  The experiment has worked. It is now a firm basis for further expansion, because we now have in these local radio stations a nucleus of trained staff who can, when they can expand, go forth and multiply. We have the nucleus of experience. We have shown, through commercial local radio, that public service can be provided at no public cost.
  We have shown, too, that we can provide a new local focus for local news and local interest. The days were when there was a competing series of local newspapers in most of our big cities. There is the famous story of the traveller arriving in Bradford and asking the newsboy for the local newspaper, whose name he had forgotten but it began with the letter "T", to which he received the reply "Dost tha mean t'Telegraph, t'Argus or

  673
  t'Observer?" There was that freedom of choice. We can revive that freedom of choice cheaply and efficiently by allowing commercial local radio to expand, to provide competition for the local Press monopolies and to provide another source of local news and information.
  I know that hon. Members may feel a certain distaste for pop music.
  Mr. Spriggs: We do. We find it for commercialism.
  Mr. Mitchell: But the point is that the audience is won by providing that audience with the kind of music that it wants to hear, which by definition is pop music, but also by providing it with local news, local service and local information. These stimulate local interest and local concern. These are provided by stations which are locally controlled. This is not, in most cases, anything that can be portrayed as a capitalist plot, because local control is the basis of these stations.
  In my own station, Pennine Radio, in Bradford, the largest single shareholding is provided by the National Union of Dyers, Bleachers and Textile Workers. These are local shareholders controlling a local station. The profits from the local stations are effectively controlled where necessary by the secondary rental.
  Therefore, why should the rest of the country be deprived of a medium which has proved its worth, proved its attractiveness and proved that it is popular? Why should the rest of the country be deprived of this local focus? There is a strong case for expansion of the network by another 60 commercial local radio stations providing places with over 200,000 people with exactly this service. It is a case which is being obstructed and held back only by the prolonged indecision which is going on.
  There is a strong case both for expansion of the ITV network by handing the fourth channel to the IBA and for the expansion of the commercial local radio network. I support the Bill only on the proviso that it is the kind of framework that will allow that rapid expansion, which we hope to secure by an early decision.
  5.3 p.m.
  Sir Paul Bryan: I declare an interest as a director of Granada Television and as a director of the Manchester
  674
  independent local radio. I start my speech by disposing of a matter that follows directly from the interest that I have just described. It s also, in fact, the subject of Clause 2, which in column inches, at any rate, it comprises two-thirds of the Bill. It affects very few hon. Members, but, as I shall seek to show, it affects more and more people in the country. I shall describe this in rather personal terms because I think that it is the most effective way to do so.
  Under the provision of the Independent Broadcasting Authority Act 1973 there are three Members—my hon. Friend the Member for Bristol, West (Mr. Cooke), the hon. Member for Grimsby (Mr. Mitchell) and myself—who must never appear in any political programme produced by an independent television company or radio company. This is because we are directors of either television companies or independent radio companies.
  In my case, I may take part in political brodacasts on BBC Leeds, but I am the only Member of Parliament in the whole of Yorkshire who is not allowed to appear on Yorkshire Television, even at election time. That is neither fair nor reasonable, especially as Yorkshire Television puts Members of Parliament on television in more programmes than any other company in the country.
  Mr. Spriggs: The hon. Gentleman has just said that he is the only Member of the House who is not allowed to appear on Yorkshire Television, even during election time. Surely he knows that if he resigned his post he could appear on Yorkshire Television.
  Sir P. Bryan: I do not think that that intervention is worth answering—
  Mr. Spriggs: The hon. Member is afraid of it.
  Sir P. Bryan: —nor, apparently, does the hon. Member for Grimsby.
  In the unlikely event of my being selected to appear on a Conservative Party party political broadcast—
  Mr. Whitelaw: That is a fate worse than death.
  Sir P. Bryan: —the programme could not be shown by any ITV company. It could appear on the BBC, but, as party political broadcasts have to be exhibited

  675
  simultaneously, presumably the ITV screens all over the country would remain blank while the BBC presented our programme.
  One would have thought that this simple statement of these facts, in their ridiculous truth, would have been enough to persuade the Home Office that, surely, this nonsense must be stopped fairly soon. On the other hand—believe it or not—when I wrote to the Home Secretary in 1976 asking him to take the first opportunity to amend this legislation, I received an answer from the Minister of State which suggested that my situation was not so bad, since if at election time I could not appear on Yorkshire Television I could then insist that none of my opponents could go on either.
  In a later letter, this time from the Home Secretary himself, which he rightly described as "an unhelpful reply" the Home Secretary stated:
  "The only consolation, if it is such, I can offer, is the knowledge that there are several Members of the Upper House who as Directors of Independent Broadcasting Companies find themselves in a similar situation to yourself."
  With the greatest respect, and with no bitterness whatever, I must tell the Home Secretary that this statement is both naive and untrue. I have to fight elections; Members of the other place do not.
  In the IBA's view, the offending Section 4(2) of the Independent Broadcasting Authority Act is unduly restrictive, and the Authority recommended to the Annan Committee that it be changed. The Annan Committee, in turn, in Chapter 7.16, reported
  "Members of Broadcasting Authorities and directors of organisations providing programmes under contract to a Broadcasting Authority should be allowed to broadcast on controversial subjects not related to broadcasting, on the services for which they have responsibility."
  Mr. English: I wonder whether the hon. Gentleman realises that if what he advocates took place we might be faced with the awful possibility that the governors and managers of the BBC would be allowed to broadcast as well.
  Sir P. Bryan: These ghastly prospects must be faced. For the time being, I shall continue with my speech.
  676
  There seems to be general agreement that the absurd situation that I have described should be brought to an end. This Bill is the obvious opportunity for that, but the Government are making a less than half-hearted effort to put things right. Now that the House is being broadcast on radio, of course, it would be completely impossible to have my voice in this House, or that of the hon. Member for Grimsby or that of my hon. Friend the Member for Bristol, West, blacked out all over the country on independent local radio; so clearly the Government have to cancel this part under Clause 2 as a great concession.
  But no attempt is being made to carry out the recommendations of the IBA and of the Annan Committee to restore our right—the normal right of any Member of Parliament—to address his constituents either over the radio or on television if invited by the appropriate organisations. I shall certainly raise this matter in Committee, but, meanwhile I should like to know why both the recommendations of the Annan Committee and those of the IBA, in a situation which was clearly absurd even before those powerful bodies expressed views, should not be accepted.
  What is more, since the Annan Committee reported the case against these restrictions has grown stronger. As the hon. Member for Grimsby said, the audience for local radio, both independent and BBC, is growing daily at a speed quite unrealised by the public. The hon. Member gave some illustrations, and I would add a vivid example from my own knowledge. In Manchester three and a half times as many people listen to the 8 o'clock news in the morning on the local commercial station as listen to BBC.
  As these new stations mature, more and more serious programmes will be broadcast. It is obvious that the next General Election will be fought to a significant extent on local commercial radio. A number of directors of independent companies are likely to be candidates of both parties, and if they are not allowed radio time, nor will their opponents be. This is too big a muddle to be tolerated.
  I take it that today's debate can be considered part of the continuing debate on the future of broadcasting for which

  677
  the Home Secretary asked and which has been going on and on and on since the publication of the Annan Report over a year ago. I shall not go over the well-worn arguments for the fourth channel going to ITV, especially as I fancy that my opinions might be considered somewhat biased, but there is a matter of fact, as opposed to opinion, which can stand another airing. Being an unwelcome fact, it is shunned by those who favour the more original ideas for the fourth channel.
  The fact is that, after a year's debate, no one has yet found a way of financing a fourth channel other than through ITV. Even the Lord Annan, who put his signature to the other plans for finance contained in his report, has come around to writing in the February issue of TV World Magazine:
  "The financial ideas, and I would say the whole argument, of the Open Broadcasting Authority were not well worked out. I think it was perfectly understandable that people said that this was financially impractical. It wasn't worked out properly."
  Any subsequent ideas for financing the fourth channel which have surfaced have one thing in common. They all assume the possibility, by one route or another, directly or indirectly, of extracting funds from the television levy. In order to restore some realism to this part of the debate, I invite the Minister to explain once and for all that, unlike the excess profits tax on independent local radio, which goes back to the IBA in the form of a secondary rental to be devoted to the improvement of the service itself, the television levy goes straight to the Treasury. It is a tax. As with any other tax, the Treasury has no intention of returning it to the industry whence it came.
  Travelling around the world, one is often told that British broadcasting is the best in the world. Coming back to Britain, one tends to believe it. But the necessity for this Bill proves, if any proof were required, that the Government can take no credit for this apparently happy state of affairs.
  The public must by now have concluded that politicians cannot resist investigating, inquiring into, setting up committees upon, every aspect of broadcasting to an utterly unreasonable extent—certainly unparalleled in any other country—but having done so, at great cost and effort
  678
  to everyone concerned, they cannot decide what to do.
  In a speech not long ago, Sir Michael Swann, the chairman of the governors of the BBC, reminded us that, over the last 30 years, the Corporation has been investigated by 20 official inquiries. ITV has been investigated, or in suspense awaiting Government decisions, over almost all its 23 years. Even since the publication of the Annan Report—the biggest inquiry of all time—we now have a Commons Select Committee investigating the IBA once again. This time it is the radio operation, which in historic terms has hardly started.
  Mr. Russell Kerr: I am sorry to interrupt what I find an interesting speech, but it is a fact that the Select Committee on Nationalised Industries, the responsible body on behalf of this House, has just begun its second investigation of the IBA over what is, after all, a 20-year period.
  Sir P. Bryan: That is a very good point. I dare say that almost every investigation can be justified in its own right. But, added up, they make a formidable number of inquiries.
  Mr. Kerr: I am trying to say that it has not been over-investigated—that is all.
  Sir P. Bryan: Not by us alone, but by the world in general it certainly has.
  The necessity for this Bill shows that my right hon. Friend the Member for Sidcup (Mr. Heath) was absolutely right eight years ago when he stopped the launching of the original Annan Committee. He judged that it would have little fresh to tell us and that there was sufficient knowledge and experience within the industry and Parliament to make the necessary decisions. In the event, as he expected, the Committee has described, perhaps more brilliantly and certainly at greater length than he expected all the difficulties facing those who have to provide our broadcasting services.
  The proper tributes are paid, the well-known strengths and weaknesses are identified once again, but as to practical propositions, to quote Sir Brian Young:
  "Understandably, with all this talking, they put all their faith for the future in yet more public debate—the favourite committee answer but the least practical answer to those who are considering what they will actually do beyond

  679
  debating these difficult problems day in and day out."
  So the Annan Report has added nothing significant to our knowledge. Its many recommendations have merely confused the Government. The only surprise is that the Minister did not take the opportunity tonight to announce the establishment of yet another committee to consider the findings of the Annan Committee.
  Mr. Wyn Roberts: Is my hon. Friend aware that the Annan Report has overtaken at least one firm decision by the Government, namely, to award the fourth channel in Wales to Welsh broadcasting? Is he aware that the Committee was aware of that decision even as it investigated broadcasting and that the Government still have not progressed with that decision?
  Sir P. Bryan: I am very glad to be able to give my hon. Friend the opportunity to make his Welsh point.
  Independence from Government influence and interference is always regarded as one of the chief virtues of our British broadcasting system. Annan picks out that blessing as something that we must defend at all costs. But that independence is confined to narrow editorial independence. En every other respect, Government interference, or the prospect of some impending Government decision, hangs over the industry like a permanent dampening fog.
  Mrs. Dunwoody: Would the hon. Gentleman suggest that in ITV companies no member of the staff or no programming assistant ever thought about the effect of the advertisers on the programme content?
  Sir P. Bryan: I am not quite sure what that has to do with what I am saying. I do not doubt that these thoughts go through people's heads.
  Mr. Tim Rathbone: I remind my hon. Friend that this question was specifically answered in the Annan Report, which found that there was absolutely no influence by advertisers on broadcasting.
  Sir P. Bryan: I am grateful to my hon. Friend for answering the question very much more effectively than I did, but I should like to get on with my
  680
  next point, which concerns the independence from the Government of television and broadcasting generally.
  I, like many others, believe that in the BBC we have a unique national asset which should be defended and which should be allowed to develop. But we have all chosen a system of financing the BBC which is bound to have exactly the opposite effect. To raise the licence fee is to make an unpopular political decision. This means that over the years the licence fee is likely to be too low to supply appropriate funds. We have one of the lowest licence fees in the world, certainly in Europe. Therefore, far from the BBC being independent of the Government, its daily existence, the quality of its programmes, the quality of its staff and the ability to keep its staff depend to an overwhelming extent on the Government's courage over a political decision. In a period such as this, I should be very surprised if the Government, before the next General Election, were able to show courage of that sort. This merely means that the BBC will continue to run down.
  Life in ITV land, alas, is overshadowed by the Government in quite a different way. Clearly, at this moment, while advertising is buoyant, ITV is not short of funds, but it lacks the ability to make any plans whatever for the future, whether in terms of investment or long-term programmes. I doubt whether the Home Secretary realises the strains on the upper echelons of both the BBC and ITV of these continuous inquiries, and in particular the Annan Committee. The preparation of evidence and the countless meetings are matters which cannot be delegated, and as a result top people in both organisations have to be taken off their usual jobs.
  A period such as the present, when clearly the Government cannot make up their own minds about the future of broadcasting, leads, naturally and legitimately, to groups setting up all over the country in the hope of getting new franchises. This would be perfectly healthy if we knew the shape of things to come, but since it is just the result of a general lack of any idea of what the future may hold many of the staff of the BBC and the ITV companies are continuously unsettled by hopes and fears which may never be realised.

  681
  As my right hon. Friend has pointed out, in June last year we were told by the Home Secretary that we could expect a White Paper in the autumn. Autumn arrived but no White Paper was produced. We were told to keep our eyes open at the turn of the year. Then it was to be February. Now we see that there will be no White Paper, and so far as this Parliament is concerned, broadcasting has no future. It is as well that broadcasting can rely on the Parliament that follows to come at last to a firm decision.
  5.23 p.m.
  Mrs. Gwyneth Dunwoody: So far I have found this an exceedingly instructive debate, not least because it has given me one or two marvellous bits of ammunition.
  If there was anything that would cause me to oppose Clause 2 of the Bill, it would be the discovery that certain Members of Parliament are absolutely forbidden from taking part in any form of broadcasting. I am not sure whether there is any way which we can extend that sort of exclusion, but I should be delighted to offer my own short list of Members who should be excluded from appearing on both radio and television. Indeed, the idea of the unfortunate editors of the parliamentary programmes having to sit hacking away at the tapes, talking out any political opinion from the remarks that they have recorded in this Parliament, endearing though it is as a thought, would, it seems to me, cause a certain amount of difficulty.
  I welcome the fact that we are having this debate on the Independent Broadcasting Authority for a number of reasons which are totally different from those given by Conservative Members. Unlike them, I do not regard the fact that we have not so far had definitive plans on the future of broadcasting and radio as being a dangerous development. I think it means that the Government are prepared to think long and hard before they take decisions.
  The right hon. Member for Penrith and the Border (Mr. Whitelaw) and the hon. Member for Howden (Sir P. Bryan) do not have any difficulty at all. "Hand it over", they say, "to the commercial boys, because they would know exactly what they were doing." Indeed, even my
  682
  talented and charming colleague, the hon. Member for Grimsby (Mr. Mitchell) seems to be labouring under one or two mild misapprehensions. I think that this apparent unanimity of feeling can only lead one to say that not everyone is of that opinion.
  Mr. Whitelaw: If the hon. Lady would read what I said a year ago in the debate, or what I have said since on the subject, she would find that I have not said "Hand it over to the commercial boys." I agree with the hon. Member for Grimsby (Mr. Mitchell) about handing it over to the IBA, which is quite a different matter from handing it over to the commercial boys.
  Mrs. Dunwoody: I am very glad to have that qualification from the right hon. Gentleman. I always feel that he labours under a slight disadvantage. He is basically a tremendously civilised and charming man and is forced into the necessity of occasionally saying things which sound the very opposite. I am very happy, therefore, to have his assurance that what he is suggesting is something other than handing it over to the commercial boys.
  The IBA, in this interim period will, it seems to me, have to look very closely at the services it provides. I am now talking not only of the IBA itself or of the companies but particularly of those who are involved in the whole question of local radio.
  My hon. Friend the Member for Grimsby said that most Members of Parliament did not hear any commercial radio. That is a sign of his youth. If he had children the same age as mine he would find it difficult to listen to any other form of radio. But the situation ought to cause us some alarm. I believe that there should be an extension of local radio. I have always believed very strongly that it is the involvement of the local community with a radio station that gives it its real use and strength.
  If we look at the work that the BBC radio is doing, particularly in areas such as Stoke-on-Trent, we see exactly how it has married into the community at every level. It not only broadcasts debates about subjects of tremendous importance to the local population; it provides information which is really useful to everybody concerned.
  Mr. Austin Mitchell: Would not my hon. Friend concede that the prime weapon in winning local participation, involvement and interest is to get the maximum possible local audience, which we get by providing people with the popular music, which attracts them at once, and with the local news, information and programmes which they also want to hear?
  Mrs. Dunwoody: My hon. Friend seems to be labouring under the delusion that the BBC plays only Bach and Beethoven. I can assure him that the BBC local radio produces exactly the sort of mix that he is talking about. But the BBC cannot provide for only one section of the community. It has to provide a balanced programme for everybody in the community. There are housewives who listen to local radio. There are youngsters who listen to local radio. People who are retired and who are interested in different subjects want to be able to hear about them on their local radio station.
  If we are to talk about the extension of local radio, we must think very carefully and strongly about the policy before we suggest that the only way to provide finance is to hand it over to the commercial interests in order to expand their advertising time. I am not one of those who say that we should never have radio advertisements, although I personally find them intensely irritating first thing in the morning.
  We must quite seriously consider whether this is the best way of serving the community as a whole. I am not convinced that it is. Indeed, I think that, both with regard to the question of the second channel and in the extension of local broadcasting services, we should be aiming at a much better quality, not an extension of opportunity for more people to make more money. I think that advertising has its place in the community. It certainly contributes very strongly and usefully to the amount of money available to the ITV companies, but the suggestion that if one automatically expands the number of channels one automatically expands consumer choice begs so many different questions.
  I went to America as a representative of the film industry to study specifically the whole effect of cable television. I was aiming particularly at its effect on the film industry at that time. I particularly
  684
  studied the programme content that one found when one had a number of different channels in a particular area.
  I was exceedingly lucky because in Los Angeles the programme controllers were very good to me and allowed me to spend a considerable amount of time studying not only their schedules but their financing and the sort of operation which they had built up. It seemed to me from a very close study of American television that one of the frightening consequences of a vast range of programmes was that one lowered the common denominator. One could see a similar pattern on every channel rather than having a choice, as we have in this country, between what is in effect a quality programme and a more popular programme.
  I am not against rubbish. I look at good old British rubbish just like anyone else. I even look at good old American rubbish. The British public certainly requires entertainment. That is one of the major functions of the television and radio services. But it must not be the only form of diet that is eternally handed out. Whether we like it or not, if the fourth channel is handed over to the commercial interests we shall not get a broadening of the programming; we shall get a repetition of the programmes that are popular on the existing channels.
  Mr. Austin Mitchell: Will not my hon Friend concede that the proper way of preventing this competition for the lowest denominator is to have numerous channels in the control of one organisation? In that way, one can, as it were, provide a layer cake in which people can choose their own level of viewing. If there are two channels for the IBA, one can have serious programmes on one channel and popular programmes on the other, and keep alternating them.
  Mrs. Dunwoody: That is one of the popular views put forward. But I do not think it would be so much a multi-layer cake—more a rather flattened sponge. I have been sufficiently involved with producers over a number of years to know that certainly in this country, when we suggest that we are expanding the opportunities for independent producers, we had better think exactly what we mean. Are we talking about expanding the opportunities for independent producers

  685
  who are financed by the existing companies? Shall we suddenly find a lot of Government money to finance new and bright young graduates of the film schools? What exactly do we mean by "an independent producer"?
  I know a great many people who are certainly independent when it comes to putting their own money into a production, but who rely wholly on existing programme contractors for the finance to do the work. I am afraid that they are not always as independent as they might initially seem. We need to be very careful before we expand in that way.
  There are several things in the IBA report which are extremely interesting. There is a number of suggestions about the complaints procedure and the sort of point which the right hon. Member for Penrith and The Border mentioned—the question of a balance and the need to have a broad approach across politics, education and entertainment. In that I disagree very strongly with the right hon. Gentleman's remarks.
  Occasionally one can accidentally give the impression that one feels there is no balance in television because one's own judgment automatically is a subjective judgment. When I see some Opposition Members on television, I feel intensely that they are being given too much time and that they are being treated far too seriously. I have no doubt that the same feeling rests in the breasts of Conservative Members when they watch some members of the Labour Party. But the difficulty is that this is an entirely subjective judgment.
  On the whole, I believe that the IBA is doing an extremely good job in seeking the sort of political balance that is absolutely necessary. Where it may not always manage to achieve the impossible is perhaps in the context of some of the entertainment programmes which from time to time seem to lean a little heavily on the side of violence. But I think that so many of the programme contractors are aware of this problem now that it will be a diminishing problem in the future. I am not one ever to suggest that this House should have any editorial control over the contents of either films or TV programmes.
  That brings me to one suggestion in the IBA report on which I feel I should comment. I must declare an interest. I am the parliamentary adviser to the
  686
  Association of Independent Cinemas, Therefore, I have been taking a considerable interest in the number of feature films that are shown on television. The IBA report says that the average weekly output of feature films has not altered a great deal. In fact, it has stuck pretty well at the level of seven, which is an agreed level. This rather begs the question of the size of the films that are shown. For instance, a Bond film shown at peak viewing hours on television has an immediate and quite dramatic effect on the viewing figures for the cinemas. Therefore, let us not imagine that it is quite as simple as saying that if we keep the number of films that are shown down to a particular level we protect all the other industries. That is not so.
  What also worries me is the suggestion that when one gets a film which for some reason or other, because it was made for the cinema, contains scenes of sex or violence is not wholly acceptable as family viewing, one should produce a television version. The report says that if a film has been cut in terms of sex or violence this will help it to become suitable. The report suggests that they have done this in America and that we ought to follow the practice here. But there is no suggestion anywhere in the report that the producer or the director of the film should be consulted.
  I think that before one hacks any kind of product to death one should consult the people who made it in the first place. One of the livelier members of the British film industry, Mr. Michael Klinger, was once reduced to impotent fury by a television company which cut one of his films, "Get Carter", into so many ribbons that it bore very little resemblance to his original work. While I do not think that either he or I would pretend that the original was highly intellectual, nevertheless it had a sincerity and honesty of its own and he was very upset by the effect. Therefore, before we start hacking other people's work to pieces, cannot we at least consult them?
  Mr. Giles Shaw: I should like to ask the hon. Lady one question and supply one point of information on what she has said on this portion of the IBA report. I think that the number of transmission hours is eight and three-quarters, not seven. With regard to cutting or altering films, who owns the copyright when

  687
  they come into the television company's possession?
  Mrs. Dunwoody: The hon. Gentleman expands the argument into an even more interesting sphere—that of copyright. What happens is that, in normal circumstances, the ITV company will in effect have hired the film. It will not have taken over the whole copyright. Therefore, the producer still retains that copyright and, needless to say, has the right to get upset if his produce is damaged without consultation. That was the simple point that I was seeking to make.
  We come back to the fact that, after all, the IBA has now had an extension of three years given to it. In that time, I hope that the Government will not only be looking at the financing of broadcasting and television channels but might even like to consider one very revolutionary idea. They might like to consider whether there is any justification for allocating the fourth channel at all unless it can be granted for educational use, for the use of the many bodies such as the Open University and the various forms of language teaching—all sorts of sensible minority uses—which I think are desperately under-served at the present time.
  We come back again to the question of finance and who will pay. Perhaps the Government will have to be the first to say that the licence fee is no longer an adequate way of producing the cash, and there must be direct grants subsidised at a national level in order to make our broadcasting units viable and able to produce a service of which we can be proud. Hon. Members opposite who spoke of finance never pointed out at any stage that the Post Office, which directly gets its money from the taxpayer, produces, pays for and maintains the cables which many of the television companies use. In that sense, the companies are already benefiting from direct grant-in-aid.
  Before we spread ourselves even more widely into the commercial field, let us consider how we can maintain the standards of our existing broadcasting system. The BBC set the pattern originally, and ITV has followed it with astonishing ability. Let us not believe that by expanding their realm we can improve the standards. Service for the viewer
  688
  and the listener should be our ultimate aim, and unless we can protect their interests we shall be in considerable difficulties.
  5.41 p.m.
  Mr. Geoffrey Johnson Smith: We all respect the great interest that we know the hon. Member for Crewe (Mrs. Dunwoody) has in the television and movie industries, but I implore her to take more account of the interests of those who work in the industry at every level.
  The hon. Lady said that she hoped that the Government, in the next three years, would give more thought and more time to the problem of the BBC licence and the problem of the fourth channel, and consider whether it should have more minority interest, whether there should be more scope for independent producers and whether there should be more variety in and better quality of programmes. But I do not believe that if this Government took from now until the end of the century they would come up with any better answers.
  In my view, it is not for the Government to do that. I believe that the Government should give the framework—and I shall come to the framework in a moment—and then let the people in the industry get on with the job. If they do not do it very well the public will tell them so, and if the public tell them in a pretty certain voice then in due course Parliament will respond. I do not believe in asking Government to do any more than they have done already.
  I do not believe that that would bring the sort of progress that the hon. Lady would like to see. If she thinks it will, why have the Government not done more already?
  The Government had the benefit of some years in opposition when they disagreed with the previous Government's decision not to have an Annan Report, but they did not come up with anything. Then they had the Amman Report a year ago, and they had been sitting on it ever since. We have not had any practical suggestions.
  In the meantime, we have a service which hon. Members on both sides of the House believe provides the best form of television and radio that has been

  689
  devised in any country. It is not a service which is just dominated, as the hon. Member for Grimsby (Mr. Mitchell) said, by big capitalist interests. It is not a service either dominated by big State capitalist interests, as in the Soviet Union and other Communist countries. It is a system that has been able to provide the benefits of public broadcasting, which is very responsive to the wishes of the viewers, together with responsible private enterprise broadcasting as well. It has taken interesting, encouraging and innovating steps in local radio so that we are seeing the emergence of a new form of community radio, the like of which is not nearly so well developed in other parts of the world. This is a remarkable post-war British achievement, and unfortunately there are not many such achievements of which we can boast.
  We should not be asking the Government to spend another three years to try to improve in any substantial way on what we have. The hon. Member for Crewe said that instead of licensing we should perhaps have grants and subsidies. Heaven forbid that broadcasting should be dependent on Government grants and subsidies. That is the way to open the door to political interference from this place. That means that there would be more interference with programme making than occurs already because of the increased dependence by the BBC on the whim of Government on whether the licence fee should be increased.
  The system of licensing is perfectly honourable. It has lasted for a great many years and it guarantees that those who work in the BBC as I did at one time, will have a great measure of responsibility, individual independence and freedom—far greater than in any other country. Why muck about with it?
  BBC morale is so low—and I speak with some knowledge from a number of friends who still work for the Corporation—because the Government do not have the guts to let the BBC get on with it and allow the licence fee to rise to, or nearly to, the level of inflation. The Government are frightened by the political considerations because this is election year.
  Mr. Hugh Jenkins: Will the hon. Member consider this aspect of
  690
  licensing? Will he not recognise that in large parts of the country people spend all their time looking at a station that is not financed by licensing? Therefore, the situation for them in relation to the licence fee is becoming increasingly untenable. While there are great virtues in the licensing system, how long is it possible to sustain the position in which people are looking at one channel but have to pay a licence fee related to another channel which they do not watch?
  Mr. Johnson Smith: I doubt whether there is a significant proportion of people in this country who spend their viewing lives watching one particular channel. If the hon. Member is really serious in advancing that argument, he must also seriously suggest that those people who have no children should opt out of that form of taxation because they have no children to educate. This hypothecation of either licensing or taxation is a sterile argument. There is no support either in the Press or among people writing into the IBA or BBC for the hon. Gentleman's argument. I can imagine it being developed as an argument if the public broadcasting authority in this country fell down so miserably on its job that it developed into a tiny minority programme company. That would be bound to give rise to the sort of clamour that the hon. Member has suggested. I do not believe that it is true in this instance.
  I declare an interest in that I am a member of the IBA general advisory council and the chairman of a local radio consortium which I hope will soon apply for and get a licence. However, the views that I express are entirely my own.
  I hope that the hon. Member for Crewe will remember that in our debate on local radio it was interesting to hear that hon. Members on both sides of the House felt that we should leave local radio alone. Hon. Members felt that the BBC should continue if it so wished but that private local radio should exist and expand as well. In this area we have the sort of mix that is very welcome.
  However, the hon. Member for Crewe keeps saying that we do not wish to hand over a fourth channel to the commercial boys, as if they were a lot of young buccaneers running an industry with the

  691
  pure intention of screwing a mighty big profit out of it and to hell with the programme consequences and the fact that they might be degrading the standards of the British people. That is not what my right hon. Friend the Member for Penrith and The Border (Mr. Whitelaw) has proposed, nor is it what is proposed by the IBA. I should like to remind her of what is on the table for her Government to consider.
  Mr. Dunwoody: The hon. Gentleman is not suggesting, is he, that the reason the companies wish to have a second channel is that they are not interested in making an extra profit?
  Mr. Johnson Smith: I am suggesting that the making of a profit is not the sole criterion of those who are involved in private enterprise broadcasting.
  Mr. Russell Kerr: It is the main one.
  Mr. Johnson Smith: The making of a profit—unless the hon. Gentleman wants to go back to subsidies, taxes and all the rest of the Socialist paraphernalia—depends on the way one puts on programmes. How else can it be done?
  Let me remind the House of what is on the table. It consists of a number of responsible suggestions. The first is the acceptance of the need that there should be programmes within ITV2 for independent producers. That would include those who are financed privately, or the TUC, CBI or any other community groups concerned with national or local issues. I am using as a background note an IBA document from a speech made by Mr. A. W. Pragnell, the deputy director general of the Authority. The document says:
  "We see independent productions from such sources occupying about 1/7th of the production time of the new channel."
  Then Mr. Pragnell proposes that the opportunities should be expanded for as much as a seventh of production time to regional ITV companies, which have increasingly proved their value to the network. Thirdly, he suggests that there should be programmes from central ITV companies, but that instead of providing 70 per cent, of the total output the proportion should be about 40 per cent.
  692
  In addition, strong and important proposals are made to provide educational programmes. I agree that possibly the financing of such programmes would come from those people who support education privately or who believe that it is a matter of community effort. Local education authorities might have to pay their whack to put on programmes—for instance, through an open college of the air. It is clear that the IBA believes in letting education form an integral part of the new service and, what is more, that some of it should find a place at peak times.
  There are other proposals which involve the management and the planning of ITV2 which would much reduce the power of the big five companies, to which the hon. Lady takes exception. Hon. Gentlemen appear to disagree with what I am saying, but these are serious proposals. I am saying to the hon. Member for Crewe and those who think as she does that if they want the debate to continue not only in this House but in the country on sensible grounds and on grounds that people can understand, it is time we took out of the argument all this pejorative phrase-making.
  These proposals make sense, and I believe that they should commend themselves to the Government. I say this particularly bearing in mind that hon. Members on both sides of the House in the debate on the Annan Report last year broadly accepted that the Annan proposals for an OBA were totally impracticable. Indeed, we heard from my hon. Friend the Member for Howden (Sir P. Bryan) that Lord Annan had admitted that such was the case.
  There is, however, one other point which will be of some appeal and with which I should like to deal. It is not a financial matter but organisational, and is in answer to the question "What is the value of bringing in a new authority?", leaving aside the financial objections which have been voiced so convincingly. The Guardian in a recent editorial gave one answer dealing with the advantage of having a new authority. That newspaper generously allowed Sir Denis Forman, chairman and joint managing director of Granada Television, to refute the answer provided by The Guardian. The Guardian article had commented:

  693
  "If you want different sorts of programmes and priorities, you must have a different structure, run by different people."
  Sir Denis Forman, in reply, said that nobody could say that BBC2 had any different structure or organisation for it to produce very different programmes—in other words, it was not "more of the same thing" with BBC2. He was saying that there was a big difference between the two channels. He continued:
  "Yet both BBC services are run within the same structure under the same Board of Governors. The many fresh programmes in the two-channel BBC have come from the 'new people' not in the shape of additional boards of governors but of a new channel controller and new creative staff. It is surely naive to believe that a new board of governors and a new structure would ipso facto produce a new kind of television. It is the programme executive, the producers and the independent creative people who will do that."
  I was once involved in a programme which broke new ground and pioneered many interesting developments in television. It was at the time when the BBC's monopoly was broken. I refer to the original "Tonight" programme. It was still the same chairman of the board of governors, still the same director general, but there were a lot more new people, although some people who were not new or who were already involved in the BBC had an opportunity and that opportunity came about because of the breaking of a monopoly.
  I believe that if the Government will rise to the proposals suggested by ITV2, it will not be necessary for them to create a new body or board to get the balance, the quality of programming, which the hon. Lady so rightly emphasised, and the variety which takes into account the need of minority interests to play their part in enriching television in this country.
  Delay has already caused a great deal of harm to the morale of those who have to plan and make the big investment decisions to avoid our lagging behind—which I fear we are in danger of doing—and to sustain the creativity and to reward, in the best way they know, those who work in television by giving them the framework within which they can make the decisions and reveal the talents which are there to be used for the benefit, not just of themselves or of the bodies which they serve, whether the BBC or the independent companies, but of the British viewer.
  5.56 p.m.
  Mr. Clement Freud: We are debating the Second Reading of the Independent Broadcasting Authority Bill. It is, as the Minister rightly said, a modest Bill, and I would go along with that view. I also maintain that it is modest due to the incompetence of the hon. Lady's Department—and I hope that she will go along with that.
  The Bill relates to two small points. One is the extension of the duration of the Authority's function and the second is the broadcasting of the proceedings of Parliament. I propose to deal only with the first point, the extension of the duration of the Authority's function.
  I maintain that it is the duty of the Government to govern and not to procrastinate. This Bill is doing nothing but that. At Question Time today, it was pointed out to the Home Secretary that his Department had promised on three occasions to publish the White Paper on the future of broadcasting, and at least today he was sufficiently honest to say that he did not know when it would be published, although privately afterwards he said that it might be in the not too distant future.
  The right hon. Gentleman said—and I thought that this was an interesting comment—that it was better that it should not be published quickly lest he should come to the wrong answer. I suggest that if he had a history of waiting for a long time and of then arriving at the right answer, that argument would have had some credibility. But there is nothing that this Government—in fact most Governments—have done which would have us believe that the longer they think about a matter, the more correct is the decision arrived at or the action that is taken. For that reason, I do not accept what he said.
  Independent broadcasting has always been governed by cycles. If the revenue is buoyant, the levy is increased, the proposal comes before this House, and by the time it becomes law there is a period of economic misery; so there are representations, as a result of which the levy is lowered, and then there is an upturn in prosperity.
  The television cycle has been simply bound up with the fact that legislation has never actually fitted circumstances. It

  695
  is as if the great programme controller in the sky fired a rocket that said "Enough" and then everything went backwards. For instance, last year was homosexuality year and one in which everybody prepared programmes to deal with it. They now find that this year is nuclear weapon year; everything has gone wrong, and it is too late to change what has been done.
  It is always said that we score over other countries because we have no political involvement in broadcasting. To an extent, that is true, certainly compared with Sweden, where the Swedes debate programme schedules in their House of Representatives. However, it is untrue—in that it is the decisions that we make here that keep the BBC going and the lack of decisions that are such an appalling burden to the IBA.
  The hon. Member for East Grinstead (Mr. Johnson Smith) made a point about the BBC licence. Let me tell him that it is a time-honoured rule that revenues from taxation are not earmarked for specific purposes. I do not accept that if the Government gave a certain sum to the BBC, totally unconnected with the amount of revenue raised by the television licence fees, it would make a blind bit of difference or give this House any more control over the BBC than the money that we vote to Her Majesty the Queen affects her personal politics.
  Mr. Hugh Jenkins: Or her sister's.
  Mr. Freud: Or her sister's, as the hon. Gentleman says. If we did so—and this is a rotten argument—it would be much better done in the case of the Betting Levy Board, which would desperately like even only 25 per cent, of the money raised by betting tax, or on the road tax fund. Heaven knows that if we had a little more of the money derived from road tax licences for highways, motoring would be very much easier.
  I should like to go through the history of the IBA. From the beginning until 1968, there was a contract. The companies had a book of rules. They did not much like it, but they abided by it. In 1968, as Sir Denis Forman said, the referee sent off two sides. They were replaced by two more, and the companies that remained knew that they were to be with us for seven more years, then 10,
  696
  now 12. Because of the delaying tactic that the Government have brought before us, the last two years will be full of intrigue and reorganisation and, as the hon. Member for Howden (Sir P. Bryan) said, it is difficult for any television company to exist in the atmosphere of the uncertainty that will pertain.
  The White Paper, which will be published in the autumn or the turn of the year or sometime, will deal with the future of broadcasting, but this is being delayed until it is channelled, I suppose, through the usual channels. The Annan Report was the twenty-fifth report on sound broadcasting since 1948.
  The Government's action in delaying the publication of the White Paper and bringing in a Bill to give the IBA an extra two years and five months of life is failing to grasp the nettle and is dodging the issue. In a lecture given to the IBA, Sir Denis said:
  "I would remind our masters in Westminster that there is a fixed term for General Elections. Although they may be more frequent, they cannot be postponed beyond five years and once the writ is issued, polling takes place in three weeks. At this moment, ITV has no writ issued, no date for its next franchise and no certainty about its future constitution."
  That is a valid point. Between the different options open to the Government, there are wide hectares of common ground. Whether it is the IBA, ITV2 or the boys in advertising, basically all that has to be decided is who shall hold the deeds and who manages the estate. The OBA has obviously not been thought about with sufficient care, and Lord Annan himself admitted this fact.
  The Government are here to govern and not to retard legislation. It is the view of ITV companies that they are being punished for making a good job of the franchise. They believe, with some justification, that a Labour Government are resentful of profits—and ITV companies make large profits. They create programmes that are watched by substantially more people than watch party political programmes. They believe that nothing fails like success and that it is for that reason that they are being punished.
  I hold no special brief for the IBA, ITV, BBC local radio or independent local radio, but there are four channels on a television set and only three of them are being used. There is a vast amount of

  697
  talent and equipment ready to implement local radio. All it needs is the go-ahead.
  I suggest that we should decide who is ready and able to do the work and allocate the facilities to the people best able to exploit them for the entertainment of the nation. If it is to their commercial benefit, good luck to them. No legislation is needed to bring this about.
  6.7 p.m.
  Mr. Phillip Whitehead: The debate has been characterised, as are most debates on broadcasting in the House, by a relatively sparse attendance and a mellifluous succession of special interests paraded before us. We are used to having interests declared and a procession of commercial acumen and eager aggrandisement displayed before us. Today it was in the shape of my hon. Friend the Member for Grimsby (Mr. Mitchell) and the hon. Member for Howden (Sir P. Bryan)—the Bootsie and Snudge of commercial radio. We have heard precisely this form of lobbying: monopoly is bad. This has been repeated constantly, particularly from the Opposition side of the House, over the years, but duopoly rules OK and long may it continue.
  I shall hope to show later why most of the arguments brought to bear on the breaking of the monopoly also apply to the breaking of the duopoly. I must pause, however, to say that the parade of arguments we have heard so far reached its reductio ad absurdum with the notion that the poor independent companies are being punished by having their right to use the public air waves extended without challenge or constraint for a further three and a half years. That is some punishment when they can earn record profits each year.
  Mr. Hugh Jenkins: And sell more dog food.
  Mr. Whitehead: Indeed. If this form of flagellation is all that we are inflicting upon the companies, it is the sort of punishment that one would expect in Paradise.
  The companies that came into their estate in 1968 on what were intended to be seven-year and not 10-year franchises will have had them for the best part of 13 years before they have to give them up and render proper accounting when
  698
  the IBA scrutinises them, if, after that, we are to have a form of independent television. I assume that we shall and that this is an assumption of the Bill, although it is a temporary one.
  I am not opposing the Bill, but I want to point out what it does and does not entail. Obviously, it entails an extension of the contract for the 15 ITV companies. These contracts have run on for a good deal longer than was ever expected. It entails the regulations of the IBA Act remaining in force, with one exception covering the broadcasting of Parliament. I agree with what was said by the hon. Member for Howden about the Annan recommendations and the question of directors of various companies broadcasting on the air. We thought that it was daft to keep this restriction in force and I am sorry that we did not take the opportunity of the Bill to go the whole way and lift it.
  It is interesting to find the hon. Member for Howden in full accord with the Annan Committee's proposals. I must declare my interest as a member of that committee. The hon. Gentleman was in full accord with the committee's proposals that were much to his benefit but became censorious when he turned to those areas that might in some degree curb his appetite.
  We should now consider the way in which the Bill need not be interpreted. The Bill does not mean that we have to have necessarily the same contractors operating in the same way in all the areas of the IBA for the next three and a half years, or that the search for new contractors and contractual areas has to be delayed until the end of that period. It is probable that my hon. Friend the Member for Nottingham, West (Mr. English) will have more to say about that. I intend to mention it again in relation to the East Midlands contract.
  The Bill does not mean that the present practices of the IBA in radio and television administration must all be preserved intact. Nor does it commit us, although many have tried to force this on us in the debates that have taken place previously, to the notion of an ITV2 run by the existing companies.
  In bringing forward a Bill of this sort and further underpinning, as is inevitable, the composition of the IBA and its 15 contracting companies, we build

  699
  into the public's mind the assumption that what goes on after 1981 will not be significantly different from what has gone on heretofore. We have to look more seriously, perhaps, at the arguments for not extending the remit of the IBA, and certainly not extending further the area of operation of the companies, as an organisation operating together the network so called, than has been done thus far.
  I direct my remarks to the first of the things that the Bill appears to rule out but which it does not necessarily rule out—namely, contractual areas. In the East Midlands it is almost unanimously felt—my hon. Friend the Member for Nottingham, West will testify to this just as strongly as I do—that we are ill served by the existing contractor for the Midlands as a whole. That is not because the contractor is a bad company but because the area that it serves is so large and has little homogeneity as a region. I refer to ATV, which covers an area from The Wrekin in the North-West down to the Welsh borders, down to Oxfordshire and Berkshire and across to Lincolnshire and the East. That is not a region that can be covered if we take into account local interests. It is much too large. Many of us feel that the IBA should long ago have heeded the complaints made in the East Midlands and learnt the lesson of its own operation in the North-West when it divided—
  Mr. Julian Critchley: Would not one answer be in the short term to persuade ATV to set up a separate studio and facilities in Nottingham?
  Mr. Whitehead: That short-term answer has a deceptive simplicity about it that we should avoid. If ATV goes ahead with its proposal to set up subsidiary stations in Nottingham and Oxford, it will use that as an argument against any division of the franchise area at a later stage.
  Mr. English: My hon. Friend will recollect that the BBC has had such a studio for many years. He will recollect that ATV went to the Nottinghamshire County Council, which is controlled by the Conservative Party, only to be asked "Why have you not done this at any time in the past 23 years?"
  Mr. Whitehead: The answer to that, as my hon. Friend knows, is purely coincidental.
  700
  Amazingly enough, ATV is now trying to tell us that these offices are being opened without regard to the torrent of criticism to which it has been subjected in the East Midlands.
  In my opinion there should be an East Midlands contractor and the contractual area should be based on the Waltham transmitter, reaching in excess of 2 million people. Little re-engineering would be necessary, and the IBA is well enough financed to undertake the necessary engineering work for such relay stations as are wanted. That area would provide a station that would come into the intermediate six companies, as they would then be, and leave ATV, which is a major company and one of the big five, still with its own area, including about 5 million people.
  That would leave the East Midlands with, I hesitate to say a lucrative, but a financially viable advertising area in terms of revenue. It would leave it with an identity of interest that has not been reflected by the large, sprawling ATV contract, which has its main film studios outside the franchise area altogether and extensive interests in other areas through the Associated Television Corporation and in making films for the United States. Those may be praiseworthy activities as regards the export market, but they butter very few parsnips with housewives in Nottingham, Derby and Leicester, and with various community leaders, including the Conservative chairman of the Derbyshire County Council, who has written to the IBA proposing such a change.
  Mr. Wyn Roberts: The hon. Gentleman will probably be aware that there are other parts of the country—for example, North Wales—that are not very well served by their regional television stations. Does he not think that the IBA is possibly wrong in not putting more pressure on the contractors to provide studio facilities where there is popular demand for them? Or does he think that the contractors are unduly inhibited by the brevity of the tenure of contract?
  Mr. Whitehead: I do not regard the length of time that they have had as brevity, given the return on equity. No commercial companies can enjoy. No company enjoying an ITV contract has ever failed to reapply for its licence. The companies are aware of the rewards that

  701
  they can enjoy. I accept that the hon. Gentleman has more experience of Welsh television than I have, and he should put the problem to the IBA.
  In some areas the IBA has in the past been far too much in pawn to the companies. It has taken the companies' view. It has accepted the companies' line. That is one of the reasons that leads me to think that we need a new authority and not the IBA to run the fourth channel.
  I hope that my hon. Friend the Under-Secretary of State will indicate when she replies the Home Office interest in this matter. I know that my right hon. Friend the Home Secretary has received a deputation on the matter and that he has made contact with the IBA. I know that the IBA is considering initiating an engineering survey and various public meetings in the East Midlands so that it may know the extent of support for an East Midlands television contractor.
  If we are to have such a contractor, it is essential to start quickly. It is essential to begin to bring forward ideas—in some instances they might be radical—about how such a company can operate and where it should be based. That should be done long before we go into the business, if we go into it at all, of reallocating the licences as a whole for all the other areas, which I assume would be the existing contract areas.
  I make some final comments about the sttrictures that have been levelled by the various directors of radio companies and television companies at the proposals of the Annan Committee. These strictures relate to the Bill as the Bill appears to entrench the duopoly and the position of the IBA. It is my belief that we needed to have the examination entailed in the deliberations of the Annan Committee.
  The hon. Member for Howden has said that it was all a waste of time and how splendid it was that the then Minister responsible, Mr. Chataway, swept away the Annan Committee in 1970. We know why that happened. One of the reasons was that the hon. Gentleman, with his extensive interests and interest in the singular—we know that he has wide knowledge of these matters—railroaded the Conservative Party into accepting a proposal for 100 commercial radio stations.
  702
  That proposal was put in peril by the setting up of a committee of inquiry. It could not have gone through if the committee of inquiry had put it under the scrutiny of factual analysis. That is why the Conservatives dumped the Annan Committee. They wanted to extend their half, the commercial half of the duopoly, without the benefit of an investigation or impartial inquiry. As a member of such an inquiry when it was finally set up, I can say that that is a pressure under which we labour the whole time. These extraordinarily well-financed and eloquent interests are always with us. They are always putting forward their proposals at every level. They are very well represented in the House and are able to make their case through their institutions of communication which mediate the whole debate in the country. That is why we have to argue much more seriously for the alternative OBA case.
  My hon. Friend the Member for Grimsby, in his engaging, homespun way, said that he had been to Columbus, Ohio—
  Mr. Mitchell: I said that I had not been to Colombus, Ohio.
  Mr. Whitehead: My hon. Friend has not been to Colombus, Ohio, but he believes that the 33 television channels there are very good. Apparently more means better.
  I have been to Dayton, Ohio, and seen all 25 channels simultaneously on the enormous bank of monitors which some Canadian companies have, which show what is going on on the cable at any one time. I will tell my hon. Friend about some of the choice that is available. Three or four channels will be soft pornography running for all the hotel rooms on closed circuit on payment of $3 a time. My hon. Friend may not think that that widens the choice very much. Another channel will have cable drums of advertisements endlessly going round before a camera. My hon. Friend may think that is not widening choice very much.
  A few more channels will carry various sponsored programmes telling people in more sophisticated terms, for richer advertisers, what is going on in Dayton, Ohio, or in Toronto, Ontario, or where-ever it may be. Is that what my hon. Friend means by more choice? I think that it is in some ways debauching, not extending, choice.
  Mr. Austin Mitchell: Since my hon. Friend has called me Snudge, perhaps I may thank Zebbedee for accepting this interruption. My hon. Friend's alternation between straight commercial pleading for an East Midlands channel and high principled condemnation of everyone else in the House leads me to ask one question. Was I not saying that more channels would work in the British, not the American, context? That context is very different and will not necessarily provide us with the choice between lowest common denominators about which my hon. Friend was talking which goes on in the United States.
  Mr. Whitehead: It very easily might if we had anything like the American model. It is dangerous to introduce into argument the example of a particular city in the United States when one has not visited it and does not know what the quality of the programme is.
  With regard to East Midlands television, I favour the proposals of an organisation called ComCon, which suggested that it should be community-controlled. That is why, when I was going into these proposals, I said that it could provide radical innovations which would not be possible if we continued with ITV1 in its present form, given the mass blockage of shareholder power within the existing ITV system. It is not that I want something like what we already have in the East Midlands. I should expect to see something better, and I think that there is a novel way of getting it.
  I return briefly to the question of the duopoly and all the splendid planning which would make sure that we had new ideas coming out of ITV2. Those who argue for it—this hesitation was apparent in Sir Denis Forman's article in The Guardian recently—are never absolutely straight in their own minds whether they are arguing, as a managing director of Trident Television has done, for a new programme contractor coming in and working directly for the IBA—I suppose that that would be a channel run in a different way by the same authority—or whether they want the existing network somehow locked into this new piece of real estate operating the second channel as well.
  Mr. Austin Mitchell: Or both.
  Mr. Whitehead: I think that both of them suffer from one natural disadvantage. First and foremost, ITV2 is run in the interests of ITV. It is run in the interests of ITV, first, because it sees off any possible competition with ITV or with the sources of revenue which ITV enjoys and, secondly, because it allows any expansion of programming to be in the interests of the companies—the big five companies in particular. I think that there are more interests in broadcasting than are covered by the big five companies, or, indeed, by the network as a whole.
  The Annan Committee said that it wanted to see the companies putting some of their talents and productions on to the fourth channel, but it wanted it to be done under a new authority in a new way. What is meant by a "new way"? Essentially, it meant that education, the Open University, and the independent procedures, whom some hon. Members have sought to scoff at in the debate, should have a higher place in the scheduling of the station. The Annan Committee did not believe that anything dominated by the ITV companies would give that result. Nor did it believe that the IBA, accustomed as it is to working with those companies, would be the best way to achieve what was wanted.
  People say to me "You are creating a new bureaucracy." I reply "Yes, we would be if we had that instead of the IBA." But sometimes small bureaucracies are better than big ones. That is something that I have learned perhaps painfully over the years. The bigger the bureaucracy, often the more hog-tied it is in the way that it operates. So a small bureaucracy running the new channel, for which one could make many of the claims that were made 20 years ago for the setting_ up of ITV, would be the best way to do it.
  The final point on this matter concerns how it will be financed. People say that Annan did not work it out. Indeed, Lord Annan has agonised in public about it. One of the reasons why we were caught and why we had to come to a unanimous agreement and reach a compromise about financing was that we allowed ourselves to be fooled by the Treasury into believing that hypothecation could not work. This time-honoured principle, as Sir Denis Forman discovered because it

  705
  marches with his own argument which he mentioned in the Guardian, does not necessarily seem to bind us. Money is being taken out of broadcasting through the levy. Money can be put back into broadcasting either by a grant-in-aid or by special appropriations for special services, whether from the Department of Education and Science, the Arts Council or wherever it may be.
  As regards other sources of revenue, the committee mentioned one in the shape of a different form of advertising—block advertising rather than the spot advertising that people have to endure on ITV and which would exist in complementary form on ITV2.
  Another way of raising revenue which has been trailed this week by Mr. Robin Day in The Times, although he did not mention the OBA, is the idea of a national lottery. People would know that they were both indulging their gambling instincts and, at the same time, supporting a worthy institution—in this case a public service. I see no reason why these ideas should not be tried if the will is there.
  We should not wait much longer for the White Paper. It is not, as the right hon. Member for Penrith and The Border (Mr. Whitelaw) said, that the Government have not made up their mind. The problem is that the Government have made up their mind more than once. They have made up their mind so often that no White Paper has appeared. To some degree, I blame the civil servants and indecision in the Cabinet for that situation. But we should have a White Paper. It should be a courageous White Paper. It should listen not to the vested interests but to the real interests of broadcasting.
  6.27 p.m.
  Mr. D. E. Thomas: I am particularly glad to follow the hon. Member for Derby, North (Mr. Whitehead) as I find myself in agreement with what he said about the OBA structure. Originally, when I spoke in the debate on the Annan Report a year ago, I was opposed to the extension of the OBA structure to Wales. I have since changed my mind. I believe that such a structure can take in both the existing commercial companies which are producing programmes in Wales, about which I shall have something to say later, and the BBC and independent
  706
  producers, particularly the independent film-makers now being established in Wales, and put out those programmes, which would be devoted mainly to Welsh language broadcasting, on the fourth channel.
  The continuing delay in publication of the White Paper, which was indicated in the unsatisfactory replies by the Home Secretary at Question Time today, will cause profound concern to all in Wales—there is virtual unanimity in Wales on this issue—who want the fourth channel to be set up immediately for Welsh language broadcasting.
  There has been argument whether that should lead to the transferring of Welsh language programmes from the existing channels. I believe that it is the only acceptable solution. The delay in setting up the fourth channel in Wales—the delay in the Government's commitment made three years ago to the Welsh people—has resulted in an increasing lobby being mounted by the commercial company which operates within Wales—HTV—to try to ensure that the fourth channel is not allocated mainly to Welsh language programming, on the basis that the language should be spread over all the channels.
  As I see it, the argument about the use of the Welsh language on the other channels has been deployed by that commercial company as a smokescreen for its own wish to continue with the franchise in Wales and to extend the commercial outlets in Wales to the fourth channel as well.
  I want to ask the Minister some questions which relate specifically to issues in Welsh language broadcasting which are relevant to our debate on the Bill. The third working party in succession has been looking at the structure of broadcasting in Wales, following the Annan recommendations. It is a working party consisting of representatives of the Under-Secretary's Department, the Welsh Office, the IBA, the BBC and HTV. Has the working party's report finally arrived at the Home Office? If so, when are we likely to have a decision on the report? The Siberry working party reported in 1975. That followed the Crawford Committee, which had recommended in the previous year that there should be a fourth channel in Wales for mainly Welsh

  707
  language programmes. We now see yet further delays.
  I should like to hear from the Under-Secretary tonight whether we are to have an announcement on the future of the fourth channel in Wales before the White Paper is produced. If we are not, if we are not to have the go-ahead for the fourth channel in Wales before the White Paper is produced, goodness knows when we shall have any movement on the fourth channel. Already we have been told that legislation cannot be introduced this Session, which means that we shall be taken into 1979. Presumably, the three-year period from the Government's decision to having the channel on the air will mean a delay well beyond 1983.
  Mr. Ioan Evans: There is a universal feeling in Wales that the fourth channel should be given to Welsh language programmes. But the difficulty facing the Government is that a fourth channel would require additional transmitters, and what we need to be thinking about is a temporary arrangement, using BBC 2, when it is not otherwise being used, for extra Welsh language programmes and relieving the two existing programmes.
  Mr. Thomas: Indeed. The BBC has put out certain Welsh language programmes on BBC2—coverage of the eisteddfod and so on. I am grateful for the hon. Gentleman's support on this issue and for the opportunity to press on the Minister the unanimity within all parties in Wales about the need for a quick decision to go ahead with the fourth channel, to honour the commitment that the Government made to the Welsh people more than three years ago.
  In the interim, we have been pressing for an extension of what we consider to be a priority area of Welsh language programming on all channels—programmes for young children. The Home Secretary in September received a deputation led jointly by the hon. Member for Cardigan (Mr. Howells) and myself, with the support of the hon. Member for Wrexham (Mr. Ellis), on this very question. With my hon. Friend the Member for Carmarthen (Mr. Evans), I met Lord Harris, the Under-Secretary's noble Friend with responsibility for these matters in the other place, to press further on this
  708
  issue six weeks ago. A national conference met in Aberystwyth, and a steering committee of the conference met in Aberystwyth last Friday.
  We have been pressing for a system whereby the Government can make money available to the BBC, with a subvention by HTV from its increasing profits, to increase immediately the hours of Welsh language programmes for children. We have estimated that we require immediately at least an extra half hour a day of programmes for young children. This would be relatively inexpensive in television terms. We are talking about £8,000 per half hour. If we had £500,000 funding for this from the Government, we could immediately go ahead with an extra half hour a day. What is happening over the submissions to the Government made over six months ago and backed up by a national conference?
  We had a clear statement from the Annan Committee in paragraph 26.31 onwards—I shall not quote it because I do not want to take up too much time—that there should be a decision by the Government on the provision of a fourth channel in Wales, and that this should certainly precede the use of the channel in the rest of the United Kingdom. It was then suggested that when the fourth channel was operating in the rest of the United Kingdom the OBA could well take responsibility for the fourth channel in Wales. But we need an interim decision in Wales before we move to the legislation that I should like to see to set up the OBA to run the fourth channel in the rest of Britain.
  I come to a number of specific questions on the Bill. First, I ask the Minister to confirm that the extension of the life of the IBA does not automatically mean an extension in the franchise period of the companies. This is very important not only for those in the East Midlands, as we heard from the hon. Member for Derby, North, but for those of us in Wales who are extremely dissatisfied with the attitude and performance of the commercial company that operates in Wales. I am not referring to Granada or Westward, nor am I thinking of those in my constituency who prefer RTE to either BBC Wales or HTV. I am referring to HTV as the company which covers the whole of Wales, in theory.

  709
  HTV was set up initially through the leadership of the television commentator, John Morgan. We are reliably informed that the idea came to him in a Soho pub, and that he subsequently rang up another distinguished Welsh broadcaster, Wynford Vaughan-Thomas, and then managed to persuade my noble constituent, Lord Harlech, to head the consortium.
  When the consortium first appeared on the scene, it had many distinguished international names: Richard Burton and Elizabeth Taylor, who were then associated; the late Stanley Baker; Geraint Evans; and Harry Secombe. It produced a fabulous—that word in its true meaning is very appropriate in this context—prospectus. Wynford Vaughan-Thomas has told us the particular vintage of wine which was decanted when the prospectus was being written.
  It appeared from the prospectus that the company promised at least fortnightly appearances by John Morgan and Geraint Evans and at least an annual appearance by Richard Burton. When the vice-chairman of HTV, Sir Alun Talfan Davies, listens to the recording of this debate or reads my remarks, I am sure that he will be able to confirm how many times Richard Burton has appeared on HTV in the past 10 years.
  What we have seen in the creation of HTV and in the way in which it has operated since making those great promises is yet another attempt by commercial interests to set up a company which has a veneer of Welshness, a veneer of local cultural appeal, which made it acceptable to the IBA. But the resulting performance of the company has in my view been dismal. I use that word advisedly.
  It is not only a matter of its performance. I do not want to comment at great length on programme content. There is also the fact that, when resources are desperately needed to make better programmes in two languages, the company has continually been siphoning money out. What concerns me is that the Bill will mean that for a further two and a half years the company will be siphoning out money from television.
  There was a flood of profits in 1975. That led the company to siphon off £1·8 million of its franchise profits. The
  710
  money went first to buy fine art dealers Frost and Reed. That was the first example of mass diversification by HTV. It was followed in the next year by a creaming off of £1·9 million. Not content with Frost and Reed, which made profits of £531,000 last year, HTV also purchased in 1977 the whole issued share capital of J. and T. Smith Ltd., which will be well known to have a very close connection with broadcasting and filmmaking. It is a firm of diary publishers, stationers and bookbinders.
  In the period during which it has been the contracting company for most of Wales, HTV has taken out £4 million, and the IBA has sat back. I have criticised the IBA committee for Wales to its face and I have criticised it in the House. It has sat back and let this happen. When we desperately need more resources for programme-making in two languages, resources have been siphoned out of television.
  The Annan Committee expressed concern about what it described as the substantial sums of money being removed from the television industry which should be used to improve programmes and conditions of employment. It said:
  "For these reasons some members of the Committee consider that diversification by the television companies should be prevented or at least severely curtailed; they think that diversification safeguards shareholders at the expense of services and employees. They believe that the television companies hold a public right to make television programmes, not to be absorbed into media conglomerates which can easily become dominated by investment decisions in quite unrelated fields of real estate, catering and amusements."
  What is true of HTV is true of many other contractors. I must press the Minister on this question. An automatic extension of the life of the IBA is resulting in an automatic extension of further profit-making by HTV and the taking out of those profits from television when they are critically needed for programme-making. I must be fair to HTV. Not all its profits is going to the directors and shareholders. I am reliably informed by my weekly Welsh language newspaper Y Cymro that there is to be a great party at Longleat—suitably. I have not been invited—yet. There are to be special buses from Cardiff, Bristol and London. I am reliably informed that Lord Harlech is not to be fed to the lions.

  711
  The result of siphoning off the profit of these commercial companies out of television must result in a decline in programme-making and in the resources that are available. I stress that in Wales we are disapointed at the failure of the Government to move to a firm decision and honour their commitment to the Welsh people on a fourth channel for Wales. We are disappointed that tonight, rather than debating proposals for the future of the fourth channel, we are having a yet further extension of the commercial interests in Wales.
  6.42 p.m.
  Mr. Michael English: This debate is a little gem. The whole process of Parliament—First Reading, Second Reading, Committee and Report stages and Third Reading in the House of Commons, and First Reading, Second Reading, Committee and Report stages and Third Reading in the House of Lords, and possibly some amendments between the Houses—has been invoked in order to do nothing.
  The hon. Member for Isle of Ely (Mr. Freud), who spoke on behalf of the Liberal Party and who has disappeared—as happens with Members from the Liberal Party from time to time—in a sense was right. Here we are wasting the time of the House of Commons, and eventually wasting the time of the House of Lords, in order to say that what the IBA is supposed to do by law this July should not be done for two years.
  In 1913, British trade was 30 per cent. of the trade of the earth. Now, it is not even one-third of that. It is less than 8 per cent. It is hardly surprising if the legislature of this country spends its time making great speeches about the proposition that we should defer what the IBA is supposed to be doing. It is a typical example of what is wrong with the country. It is also why people complain about us. In this context they are absolutely right. They are right to complain that we are wasting their time.
  My hon. Friend the Member for Derby, North (Mr. Whitehead) made his points, as did my hon. Friend the Member for Grimsby (Mr. Mitchell) and the hon. Member for Merioneth (Mr. Thomas). All these hon. Members have particular points that should be dealt with by the IBA. We are not satisfied in the East
  712
  Midlands with the service that we are getting, nor is the hon. Member for Merioneth satisfied with the service that he is getting in Wales. But what do we do? We defer it. We sweep the problem under the carpet and hide it away.
  The hon. Member for Aldershot (Mr. Critchley) intervened earlier in the speech by my hon. Friend the Member for Derby, North. His party is so interested that I believe that it has issued only a one-line Whip to its Members. His colleagues have been instructed to go away if they wish. They have gone away. They are not here. Only the hon. Member for Aldershot, a Whip, one hon. Member immediately behind him and another a little further away are on the Opposition Benches. This is the total extent of the interest of a party which claims to want to govern the United Kingdom in this medium of communication. It is the most interesting medium to most people, and most people watch it. The total extent of their interest is to have four Members of the Conservative Party in the Chamber to discuss what most people are watching now instead of listening to us.
  I turn to the problems that concern those people who are watching. The hon. Member for Aldershot said "Is it not nice of Associated Television to offer to put a studio in Nottingham?"
  Mr. Critchley: I hesitate to interrupt the hon. Member, but I made what I thought was a helpful suggestion. I said that I thought it might be prepared to do that.
  Mr. English: One would have thought that it would have offered it 23 years ago. I believe that it got its franchise in the mid-1950s. That is only a little short of a quarter of a century ago. In the whole of that time, Associated Television has never set up a studio in the East Midlands. The BBC did. It set up a small studio which until recently operated only in black and white. Now it can deal with colour and is, therefore, more useful.
  I see that the hon. Member for Rushcliffe (Mr. Clarke) has joined the limited Opposition team, and has increased that team from four to five. I stand corrected. Still there are only four hon. Members on the Opposition Benches, because the hon. Member for Rushcliffe has replaced another hon. Member who has left the

  713
  Chamber. Of the Conservative Members in the Chamber, three-quarters of them are on the Opposition Front Bench.
  In the East Midlands there are, I think, 44 Members of Parliament. As in any sensible economic planning and social region of the United Kingdom, there are no Liberal Members of Parliament in the East Midlands. Of those 44 hon. Members, about 35 Labour and Conservative Members are supporters of the principle that the East Midlands, which is a separate social region of the United Kingdom, should have its own television programme company. That view is held irrespective of party.
  My hon. Friend the Member for Derby, North kindly said that I led a delegation to the Home Secretary. The truth, however, is that the hon. Member for Beeston (Mr. Lester), who is a Conservative Whip, and I led a delegation to the Home Secretary. We have always kept this matter on a bipartisan level. There has never been any political disagreement on this subject. The belief in the East Midlands that the region should have a separate programme company is almost universal.
  I am informed by people who serve on the Independent Broadcasting Authority that there are three reasons for having a separate programme company. They say that one is social, one engineering and the third financial. The second point, on engineering, boils down to the question of finance. The IBA may construct transmitters, but then it rents them out and charges for its services. If programme companies rent transmitters, ultimately it is the advertisers who pay for them. So for a viable television company, engineering should not be a problem, but it is. I and my colleagues in the East Midlands do not wish the machine to continue to dominate mankind.
  It was perfectly understandable that in the mid-1950s everyone was trying to hurry. Television had been reinstated after the war. It appeared in the South-East, and immediately people in Birmingham, Manchester, Liverpool and Glasgow wanted to see this wonderful new medium. In a great hurry it extended from the South-East to Birmingham, Manchester and Scotland. By erecting a couple of television masts on the Pennines, it was possible to serve Lancashire and Yorkshire. The old "Granadaland", as it was called when I lived there, which
  714
  constituted Lancashire and Yorkshire, was serviced by that one company. But Lancashire and Yorkshire did not regard themselves as the same. They are not identical, and most people born in one would regard the other highly but as slightly secondary to their own county.
  Now, the old "Granadaland" has been split up into Lancashire and Yorkshire. At the time that the original Granada company was established, the Midlands region was also created, in television terms. That embraces two regions which have been socially distinct for so long that in the ninth century the East Midlands was conquered by the Danes while the West Midlands escaped a similar fate.
  Mr. Austin Mitchell: May I express my support for the cause that my hon. Friend is developing, but may I ask him to cease drawing attention to the numbers of Members in the Chamber since I shall be withdrawing from it?
  Mr. English: I am far too skilful a politician to draw attention to the numbers of Members present on my side. I always do it in respect of the Opposition, and I see that their number is still four, but with a different composition.
  In the past it was necessary, from an engineering point of view, to hurry to establish television transmitters wherever they could be established. My hon. Friend the Member for Derby, North said that he would like an East Midlands region established, based on the Waltham transmitter. I understand that that transmitter is in its present location only by pure accident. The engineers wanted to put it somewhere else to serve the East Midlands, but the local planning authority concerned would not have such a nasty thing in its area. The result was that it was put in its present location to save time. The bodies concerned could have argued about the matter for six months, but instead they located it in the area of another planning authority. That is the sort of reason why transmitters are located where they are.
  Engineering should not be a reason for not having separate programmes for the East Midlands. The East Midlands is a separate region. It is certainly a separate economic planning region, just as the West Midlands, Yorkshire, the North-West, the South-East and the South-West

  715
  are. Those regions may not be perfect in terms of exact boundaries, but they are approximately the social regions of England. The people of the East Midlands are nearly as great in number as the people of Scotland and are more numerous than the people of Northern Ireland. They therefore deserve to be able to see themselves and their own social organisations on a television screen.
  I understand that the Home Office does not want these nasty discussions coming up just before the next General Election. Its only contribution to this problem is this Bill, which says "Let us defer the matter for two years."
  6.56 p.m.
  Mr. Giles Shaw: We are having a fairly desultory debate tonight and the hon. Member for Nottingham, West (Mr. English) was not unjust in drawing attention to the fact that here we are, in the week in which the radio broadcasting of our proceedings commenced, actually discussing broadcasting, yet the House is virtually empty. He is right that this debate is about extending the franchise of the IBA, which is a decision of enormous importance. It has come very late for the reasons that hon. Members have already explained.
  Perhaps I may declare an interest of a different kind. I am a member of the Select Committee on Nationalised Industries. At present we are investigating the IBA. Perhaps the only good result that may have come from this Bill is that the report of the Select Committee will be available before the Government produce their Green Paper or White Paper on the subject—I have no doubt it will be well in time for that. It is important that as a Committee we update our views on broadcasting. I must be careful about the extent to which I discuss in the Chamber the proceedings of our Committee. We have had certain public sessions, however, and I believe that I can recall some of the points that were made.
  First, let me dramatise the anxiety which has been expressed at the approach adopted by the Government. It is a non method. It is a decision to postpone a decision. As Lady Plowden, the chairman of the IBA said the other night, this is a mini mini Bill; it is not even a mini Bill. As so many hon. Members have
  716
  said, such an approach perpetuates the uncertainty, but, further, it is an extraordinary decision to take in straight economic terms.
  At the moment the Authority runs its independent radio companies on the basis of annual rolling contracts. I feel certain that the decision is due in part at least to the expiry of its franchise, which was to be next year and because many radio stations have been set up recently. It is a good testing procedure. The Authority is faced with two and a half years of continued viability. The whole of the independent radio network, therefore, will presumably continue to operate on a 12-months, begging-bowl-to-begging-bowl operation. To perpetuate that consequence I find thoroughly distasteful.
  If there is one fact that our Committee will in due course pronounce upon it is that there is a thriving and extremely valuable and socially oriented medium now in existence—independent local radio. I am deeply saddened that the Government should have decided to postpone their decision by that time and compound the difficulty of establishing permanent viable thriving companies which could provide services to listeners in the regions.
  The decision is not to be welcomed commercially for another reason. I can well understand the Government's reluctance to get involved in a decision which could leave awkward electoral problems in its wake. If they decide to act one way—commercially—they will be criticised; but they would be criticised anyway if they went for the OBA decision, so we had best forget the criticism.
  But the important thing, in my judgment, is that one has a viable climate in which to make that decision. It so happens that in the question of channels, whether they be radio or television, one currently has a satisfactory climate. Even the smallest radio company has been able to generate funds and to sustain its life. There have been substantial difficulties in the past. Major companies—one of the London companies, as the Under-Secretary will know—have very nearly collapsed and have had to be sustained by a further injection of capital. But currently the climate which provides the revenues for independent local radio is good, as it is good for independent television companies.

  717
  If ever there was a time in which one could make a decision or a recommendation that involved the use of risk capital—I shall not be drawn at present as to the details of that decision—this is that time. As far as one can judge, over the next year or two the prospects for generating advertising revenue through local radio or through television certainly appear buoyant. To postpone the decision for up to two and a half years could well mean running the substantial risk of having a climate that was not nearly so buoyant for the creation of a new creature, whatever that creature might be.
  Therefore, I deeply regret that decision that the Government have taken when they could have taken a decision that would have fertile ground on which to grow.
  Sir P. Bryan: With his great experience of marketing, does not my hon. Friend agree that the buoyancy of advertising or the future of advertising is the most difficult thing to foretell that one could imagine? Even the greatest experts cannot forecast a year ahead.
  Mr. Shaw: My hon. Friend is absolutely right. As far as I know, not only is there no practical formula to be applied to it, but the consequences of one's planning, in marketing terms, are quite often overtaken by events of which there is absolutely no prospect. Many must be astounded even now, when our economy is only just beginning to recover from a traumatic period, that there should be a buoyant advertising climate, but that is so. There are others more qualified than I to comment upon it.
  I want to turn briefly to some other elements. I must regret the continued anguish that is expressed in the House about the commercial interests. If I regret one thing, it is that the late Lord Thomson was ill-advised enough to make the statement that a television franchise was a licence to print money. If ever four or five words were used to ill-serve the medium of which he was so distinguished a member, they were those words.
  Mr. John Watkinson: True or false?
  Mr. Shaw: At the time when Lord Thomson uttered those words, under the extremely favourable monopoly conditions
  718
  that existed then, it was undoubtedly a true statement.
  It is the duty of this House—as has, to some extent, already been delivered in the way in which the IBA has developed—to ensure that any decision that this House takes in relation to the future of broadcasting does not perpetuate any monopoly condition. The test that I would apply to whatever might be instituted as the new structure for the IBA would be the extent to which it was genuinely competitive, because then one would ensure that the late Lord Thomson's aphorism would be proved to be false.
  Mr. English: Does the hon. Member realise that that is what all of my Conservative and Labour colleagues in the East Midlands wish, a little competition, instead of being monopolised by Shepperton and Birmingham, neither of which is in the East Midlands?
  Mr. Shaw: The hon. Member has made his point admirably, and I endorse it. In an area as large as the East Midlands, we should be able to fund a separate television area without too much major risk being taken.
  I have been slightly deflected, and I want to return to the point about the commercial climate. I have referred to the antagonism about it. The reason why I so deeply regret it is that not only does it prejudice too much the opinions of hon. Members upon such an important issue as this but it is symptomatic of what I regard as a major decline in our attitudes towards commercial interest
  For example, we spend, quite rightly, a great deal of our time discussing the problems of employment and investment in our basic industries, and in discussion of the diabolical state of the economy in our particular region. We tend to talk globally about the consequences of economic policies. But how often in the House do we ever mention the word "selling", or how often do we really take some pride in advertising? How often in the House do we talk about the consumer not as someone, in a sense, who needs protection—although I appreciate that there are areas of commercial activities from which the consumer should be protected—but as someone whose interest we should seek to stimulate in order to

  719
  buy, to create and, indeed, to provide jobs and investment and, therefore, a more viable economy?
  I believe it to be a talisman of the future development of our economy that we encourage a much wider application of selling techniques and give salesmanship its proper place.
  Within that context, the commercial interest is a totally honourable interest. It may have excesses, as any other form of activity will surely have. The aggrandisement of the big company, in television or elsewhere, is just as dangerous as the aggrandisement of the big trade union, and I agree that we should seek to curb it. But I deplore the writing-down, the whole time, of the people whose task in life is to generate sales, jobs and profits, because without such generation our future is nothing.
  I have not finished my speech, but if the hon. Member for Putney (Mr. Jenkins)—
  Mr. Hugh Jenkins: I was not wishing to interrupt the hon. Member.
  Mr. Shaw: I appreciate the hon. Member's keenness and I know that, with his passionate interest in noise, he probably thinks that I have already had too many decibels. However, I shall continue for a little longer.
  I regret that the Government have not seen fit to widen the scope of the Bill a little. Comments have been made by hon. Members about what could be done by a quite simple addition of clauses to widen the Bill in relation to the Authority. I draw the Under-Secretary's attention to the following specific point. She will know that, the IBA report and accounts for the year 1976–77 have now arrived, approximately 12 months after the conclusion of the financial year concerned. She will also know, as I think the House will know—if it does not, I must tell it—that this delay was in large measure due to a disagreement between the Authority and her Department in relation to the allocation of the profit that the IBA made.
  As the director-general of the Authority made clear to our Committee at a public hearing, this was a matter of intensive discussion between, I suspect, the hon. Lady, or, possibly, her right hon. Friend the noble Lord, and the Authority,
  720
  as to the decision about what to do with the £1·2 million, I think, that the Authority had made. The Authority sought to place that money for reserve capital, and, bearing in mind the necessity of maintaining and improving the technical facilities for which the Authority is responsible, that seems to be a not unreasonable attitude of mind. The Government thought otherwise because they sought to have the money returned to the Consolidated Fund.
  It is a truism that, if a nationalised undertaking is so rash as to make a profit, there is nothing so keen as the Treasury to try to get some of that profit back. On behalf of taxpayers, I welcome that attitude. On the other hand, the hon. Lady and her Department have a duty to ensure that the IBA can make adequate provision for capital replacement. Bearing in mind particularly the shortish future that the hon. Lady is prepared to give the Authority, I am a bit staggered that she has allowed this to be a subject of such enormous protraction and debate. What financial policy will the Minister now apply for the next two and a half years to the Authority's generated profits? It is not good enough merely to say that they will take each year as it comes. The Authority should know what the policy on its profits will be if it is to have two and a half years' more franchise.
  My second point is of more general application—the question of joint coverage by the Authority and the BBC. Hon. Members will be aware of the intensive and protracted discussions of the coverage of the World Cup and other football matches in South America. It appears that the unfortunate viewer is to be provided with nothing but football, morning, noon and no doubt night, on both the main channels. The possibility of a shared arrangement has now finally collapsed. What will the Minister do about it?
  The IBA has asked whether this matter can be arbitrated. Will the Minister appoint an arbitrator? If not, does she think that she is discharging her authority correctly in allowing this medium to be so monopolised because the two bodies cannot agree on a shared service, which can only benefit the consumer? There has been enough discussion about the importance of choice. The viewer should be given a reasonable choice in this matter.

  721
  The BBC, splendid corporation though it is, has not covered itself with glory in recent days. I was astounded that it found great difficulty in finding transmission time for the Archbishop of Canterbury on Good Friday but gave peak viewing time to the so-called "wizard" of the Ku Klux Klan when the Home Office had already declared him a prohibited immigrant. If that is the standard the BBC portrays as the proper franchise of the Reithian charter, I am astounded. If it seeks to retain its special position as the keeper of the Ark of the Covenant, it must seek more frequently to show that it believes what it says.
  But we are concerned primarily with the IBA. The Government's decision to offer us this mini Bill is belated. We have no real alternative to accepting it. I am astounded that it must go through all the parliamentary processes, because this matter surely should be handled more sensibly. The IBA provides a range of services on television and radio which usually commands the majority of the audiences available. That is the testimony to its good sense, and I wish it well.
  7.14 p.m.
  Mr. Hugh Jenkins: I am glad that the hon. Member for Pudsey (Mr. Shaw) did not sit down when I thought he was going to. If he had, we should have heard nothing from him about the interests of the viewers. Until then he had talked only about profits, selling and commercial viability, until one could have forgotten that television was for viewers. He talked as though it was for the interests of those who produce it.
  Mr. English: It is.
  Mr. Jenkins: No doubt that is true for some Conservative Members who have a close interest in the commercial viability of television. But we on this side recognise that television is for people to look at.
  My hon. Friend the Member for Nottingham, West (Mr. English) drew attention to a problem in his area. The hon. Member for Merioneth (Mr. Thomas) mentioned the Welsh problems and the basic flaw in the IBA system. As the hon. Member for Pudsey reminded us, the Select Committee of which he is a member is investigating the IBA. I hope that it will not confine itself to the way in
  722
  which the system is operated now but will ask wider questions. Even if the hon. Gentleman finds the possibility repugnant, I hope that the Committee will consider whether commercial interests do not play too large a part in the decision-making process in commercial television.
  The hon. Member for Merioneth felt that the money that programme companies in his area were investing elsewhere could be used to improve programmes. The hon. Member for Pudsey mentioned the amount that the Government take from commercial television. I believe that that money should also be devoted to improving programmes, but, under the present system, how can one be sure that if the Government did not take the money the programme contractors would have any change of heart and would not spend it elsewhere or invest it elsewhere themselves?
  The Annan Committee has not tackled the problem of ensuring that, under the franchise system, commercial companies whose object must be, among other things, to satisfy their shareholders, to spread and safeguard their commercial interests, give programmes their proper share of the huge advertising income. After all, that income arises because people look at television—not primarily to see the advertisements, but to be entertained and to receive information and news. The advertising revenue is incidental: this is really entertainment and information money, of which the Government are taking a share.
  The money should be ploughed back to improve programmes. The Pilkington Committee was right to say that the Authority should receive the advertising revenue and redistribute it among the programme contractors so as to remove the commercial incentive altogether. I do not suppose that the hon. Member for Pudsey will agree with that, but I hope that the Select Committee will not exclude the possibility of some rearrangement of responsibility between the IBA and the indepenedent programme companies.
  The view is sometimes taken that, instead of being in charge of the companies, the IBA is their creature.
  Mr. Giles Shaw: Perhaps I may correct one thing that I may have implied. The Select Committee is examining the IBA under its terms of reference to

  723
  examine the Authority's report and accounts. We are not conducting, as I may have implied, a mini-Annan.
  Mr. Jenkins: I am rather sorry that that is the case, although obviously I understand that it must be so. My right hon. Friend the Home Secretary will be reading the Official Report and I hope that he will take these points into consideration in preparing his White Paper.
  My hon. Friend the Member for Nottingham, West has referred to the small number of Conservative Members present. Admittedly, there are very few Labour Members present, but in a matter of this importance my right hon. Friend the Home Secretary might have done us the courtesy of perhaps opening the debate rather than leaving the entire burden in the very capable hands of my hon. Friend the Under-Secretary of State, who knows that I am one of her many admirers. I should have thought that a debate of this importance demanded the presence of the senior Minister at least in some capacity.
  Although the Bill purports to do one small thing, that is, to extend the life of the existing services for a few years until the end of 1981, the debate has ranged much wider than the Bill might seem to justify. You, Mr. Deputy Speaker, have been generous enough to allow us to range widely. For this reason again I regret the absence of my right hon. Friend the Home Secretary, and in saying that I in no way diminish my admiration for my hon. Friend the Under-Secretary.
  In the Short Title it is stated that the period during which services are to be provided by the IBA is to be extended until 31st December 1981. It is a little unusual that the date should appear in the Short Title. The usual procedure would be for the date to appear in the body of the Bill. Some of us may wish the Committee to vary the date, and I should not like to be told in Committee that it was impossible to change the date, for example, to 31st December 1980.
  I hope, therefore, that my right hon. Friend the Home Secretary will give us an assurance that it will be possible in Committee, if we so wish, to alter the date in the way that I have indicated. If that assurance could not be given,
  724
  I would have some doubts whether I could support the Second Reading. I was proposing to support it on the assumption that it would be possible to make that alteration in Committee.
  Although there are 10 million people living in the London area, we have no real local television. There is never any programme of the type which exists in most cities or towns, on which, for example, Members of Parliament can speak about problems which relate to the area they represent. No such programme exists, except for "The London Programme", which is a good one, dealing once a week on commercial television specifically with London problems.
  As for radio, in London we have at the moment three stations. First, there is Capital Radio. Although originally we were offered all sorts of tremendous artistic experiences, it has turned out to be a pop station. Suddenly it appears sometimes to be little else. Now that we are moving up towards the consideration of a franchise, we may find that there is a little less pop and a little more of other matters in order to fulfil the terms of the franchise. It is quite a good pop station. But it is, nevertheless, a pop station.
  The London Broadcasting Company deals quite well with news and occasionally tells us the condition of the traffic in London, which is usually snarled up. That is certainly helpful. Radio London rather falls between the two stools. But neither of the two commercial radio stations nor the one BBC local radio station provides a sufficiently local service in London. This is one reason why I support the Annan Committee's recommendation that there should be a parent body concerned with co-ordinating local radio as a whole. I hope that my right hon. Friend will include that in his White Paper.
  Only when there is a national body responsible for the co-ordination and creation of local radio shall we be able to divide London into areas in which there will be a recognisable local station. If this is not possible in a borough sense, it should at least be possible to have, say, three stations covering the area north of the river and three stations covering the area south of the river. With a local identity of that sort, we should have the possibility of enjoying in London what

  725
  many towns already enjoy. Some towns already have two genuine local radio stations which deal with local problems. We have nothing of that sort in London. Sometimes we hear that various parts of the country are deprived of benefits which London enjoys. In some respects Londoners do not enjoy the benefits which are enjoyed in some other parts of the country.
  I do not know whether to wish that we should have from the Minister a White Paper or a Green Paper. If I thought that it would come down, broadly speaking, on the lines mentioned by my hon. Friend the Member for Derby, North (Mr. Whitehead), I should be in favour of a White Paper. If, on the other hand, it were to weaken Annan, I think that a Green Paper would be preferable, so that we could argue the matter a little more freely. However, we shall have to wait and see what happens in that respect.
  I rather share the views of those who feel that it is a pity that the present services have to go on until the end of 1981 before we are able to make up our minds what to do about them. However, on the basis that if my right hon. Friend had taken notice of some of the advice he has been given the position would be much worse than it is at present, I support the Bill. At least we have the assurance that until the end of 1981 things will not get any worse. I agree with those who have said that, with all its faults, we have one of the best television and radio systems in the world.
  It would be all too easy to make changes for the worse. Let us make sure that when we change the system of broadcasting we change it for the better. In my view, that will be achieved by increasing the amount of genuine choice available and by decreasing the degree of commercial control.
  7.29 p.m.
  Mr. Tim Rathbone: I am very pleased to follow the hon. Member for Putney (Mr. Jenkins). I follow much of his argument and I certainly agree with his comment on the absence of the Home Secretary. In the light of the jibes which were flung across the Chamber by the hon. Member for Nottingham, West (Mr. English), I point out to the House that
  726
  the Shadow Home Secretary, my right hon. Friend the Member for Penrith and The Border (Mr. Whitelaw), was present and contributed to the debate at the opening of it.
  I rather doubt that the points just made about the removal of the flow of advertising revenue from each of the production companies—and its redirection directly into the IBA—would reduce the commercial incentive, as the hon. Member for Putney has suggested. The commercial incentive is not revenue-based. It is audience-based, as I think the hon. Member was pointing out earlier, and the incentive exists just as strongly within the BBC as it does within the independent television companies.
  I do, however, support specifically and strongly the hon. Gentleman's advocacy of local radio. I am not as convinced as he is that the Annan formula is correct. I shall return to that in a moment. Being not quite as strong a supporter of the Annan Report as the hon. Gentleman, I would tend to invert the colours of the paper which I hope to see emanating from the Government as soon as possible.
  The extension of the licence for the IBA is absolutely essential and, therefore, the Bill is sensible and to be welcomed. It is crucial to the good sense of broadcasting now. It is not doing nothing, as the hon. Member for Nottingham, West suggested. But the reason why the House has been empty is that the Bill would not have been necessary if the Government had not dragged their feet in the first place, as was pointed out by my right hon Friend the Member for Penrith and The Border and my hon. Friend the Member for Pudsey (Mr. Shaw).
  If the Government had not resuscitated the Annan Committee, the whole decision-making process would probably have been out of the way. It was perhaps sad that the last Conservative Government did not take it that way when they were in power after 1970 in the same way as they took the vital steps on broadcasting when they came to power in the late 1950s. That is not to say that the Annan Report does not provide a most useful review of broadcasting in this country, because it does, but it does not add very much to the sum of debate as to the direction in which we should be going.

  727
  Nor would the Bill be necessary if the Home Secretary himself had stuck to his guns in sticking by the argument which it is reputed he carried into Cabinet and then was forced to give up. Nor would it have been necessary if the Government had not forced him to give up those original recommendations because they are continually kowtowing to their radical Left wing.
  But none of this criticism comes very well from the hon. Member for the Isle of Ely (Mr. Freud), who criticised the Government. Of course, it is his responsibility that the Government are still here and in a position to drag their feet. If he and his party had not supported this Government, the Conservative Party would be in power and would be doing something sensible to carry broadcasting forward into the 1980s, the 1990s and the twenty-first century.
  I should like to ask the Government one or two specific questions about the Bill. The first relates to the financial aspects of it. The Bill provides the power to extend the loans which have been made from time to time by the Government to the IBA. I wonder what the extent of the loan extension will be with regard to both time and amount. In addition, what additional loans do the Government expect to have to grant to the IBA during the two-and-a-half-year extended period of its existence?
  In the other direction, there is no estimate in the Bill—indeed, there is no mention in the Bill—of what added funds will flow into the Treasury by the continuation of the IBA for two and a half more years—that is, funds over and above the funds that would already have flowed in between now and the beginning of that two-and-a-half-year extension period.
  Are the Government sure—as the last part of the Explanatory and Financial Memorandum seems to indicate—that there will be no need for increased staff at the IBA during the extension period? I ask this question because the IBA is not a fat organisation. It is slim and energetic. It is perfectly possible that the Government will require the IBA to take steps during that two-and-a-half-year extension period which it would be impossible
  728
  to take without additional staff. There seems to be a commitment in the Bill to not adding to staff.
  Indeed, I myself would hope that the IBA would be given one task. I am a little disappointed that the opportunity for debating the Bill has not led to an opportunity for giving the IBA that task—that is, of proceeding immediately with the extension of local radio broadcasting into other radio markets. In this I am delighted to support the hon. Member for Grimsby (Mr. Mitchell). I am sorry that he has left the Chamber.
  In this context I should declare my interest, although it has no bearing on the argument that I shall make. I am a director of an advertising agency. That has no bearing because I advocate the extension of radio broadcasting, whether it is under the IBA's auspices or under the BBC's auspices. I should like to see both go ahead. But I should like to declare an interest which other hon. Members have declared before now—the interest of a Member of Parliament with a constituency which is, at least in part, covered by a local radio station, in this instance BBC Radio Brighton.
  I have, therefore, been able to judge at first hand the excellent job that local radio can do, and is doing, in this country in the areas where it is already available. The Government give the indication that they are unaware that they have the right under the existing law to give the direction to the IBA to extend local broadcasting. They have that right. They require no additional legislation. They do not have to wait until the Annan Report or plans are brought forward.
  It is all the more pity that the Government are not planning such an extension, because all the indications are that additional local radio is desired. It has proved itself in terms of quality and the audience which it can attract. With regard to the IBA, it has proved itself in economic terms as well. This is within the IBA's capability and plans—because the plans have been put forward to the Home Secretary by the IBA.
  It is within the capability of both the IBA and the BBC, as was dramatically illustrated by the BBC's most excellent initiative during the storms in the West Country when Radio Taunton—which is sitting there waiting for the green light

  729
  to go—was put on air within a period of 24 hours. It carried on broadcasting throughout the period of the emergency and was then taken off and put back into mothballs, more's the pity.
  It should also be mentioned in this context that extension of local radio under the IBA would cost the taxpayer not a penny over the period of the next three or four years. It could be financed directly from the secondary rental income which has now become available to the IBA. As I have already mentioned, it is no argument that this needs to be part of the greater Annan debate or plan flowing from the Annan paper, be it Green or White.
  I advocate this step immediately because such authorisation now would ensure more local radio broadcasting, for more people, in less time, and at less cost—or no added cost—than the plans put forward in the Annan recommendations. It would also be brought about with a less bureaucratic heavy hand upon it, as Annan prescribed in its expansion formula under an OBA or LBA. Nor would it lead to unmanageable airwave clutter from overlapping broadcast signals. This is a point which is made too often against the giving of local radio stations by the Home Office. It is worth pointing out that there are in other communities and other countries small local radio stations—up to 10 or 12 in a market of 10,000 or 12,000 people.
  The opportunity of debating the Bill has been missed as an opportunity for the Government to put forward their plans for and thoughts about tomorrow. We must have tomorrow in mind because next year the Government will attend the 1979 world administrative radio conference, where it will have to go into an international conclave in order to lay claim to radio frequencies for use in this country for the next quarter-century.
  I have concentrated so far somewhat vicariously on Clause 1, the need for which I welcome as I value the broadcasting of proceedings of this House. Equally, I welcome Clause 2, which guarantees the free reporting of free speech in this House. This was something that was not always taken for granted, and most recently, when the Annan Report was published, the independent television companies were most reticent about carrying reports from politicians on
  730
  it because of the existence of these provisions. I share the wish with other hon. Members that the clause might have been drawn wider, and perhaps in Committee we shall have the opportunity of applying a wider basis.
  I wish that the clause embraced more people and greater areas by the extension of local broadcasting. I believe that there should not be any identifiable community that does not have in the foreseeable future at least one local radio station of its own. By "community" I mean a precinct community such as those within the Greater London area; or social and national communities. This would do more for race relations than anything that the Home Secretary said this afternoon. It also means geographical communities, and this would do more good than any Government plans for devolved Assemblies. It could also mean communities by age groups—young people in universities or older people in retirement areas, such as in my constituency.
  I seek a reassurance from the Government on three final points. Does the Bill indicate the Government's denial of, or another nail in the coffin for, the Labour document "People and the Media"? I hope it does, because extending the existence of the IBA for two and a half years means that the application of the absurd plans put forward in "People and the Media" cannot come forward until the end of that time.
  Secondly, I seek reassurance on how, if at all, the Government's White Paper of yesterday will apply to Government relationships with the IBA and the BBC. My hon. Friend the Member for Pudsey said that his Select Committee on the Nationalised Industries was looking at the IBA. Therefore, it can be looked upon, as can the BBC, as a nationalised industry. The White Paper yesterday, entitled "The Nationalised Industries", in its advocacy of ministerial powers to compel the boards of nationalised industries to take any action they felt necessary in the national interest, could be, and, if applied, would be, an unwarranted intrusion into the established freedom of broadcasting from Government influence.
  My last point is that, although there is much debate about the IBA, this point extends over both the IBA and the BBC. At a time when the Government are giving an extension of the licence, it is

  731
  an appropriate moment to ask the IBA to look at itself to see what it is doing in the period of the extension, and the period leading up to the extension, to improve its operations. I suggest that the Government should urge it to undertake even more research into the relationship between what is broadcast and people's awarenes of, perception of and reaction to what is broadcast.
  What balance is needed? I do not refer only to political balance. I mean moral, social and religious balance as well. Nor do I mean only the balance between programmes; there is also the balance within programmes. Broadcasting is a very ephemeral medium, and a single exposure to a single influence is all the more important. I wonder whether the Government have encouraged research into such matters. They should do so because this is of great significance to the future of our society.
  In conclusion, I believe that the Government could be correctly criticised for doing too much too fast and too wrong in many areas. In broadcasting they are doing too little too slowly. I hope that they will roll out their thinking on broadcasting, which bears so directly on the lives of almost all people in this country every day. They should do this very quickly with the appearance of either a White Paper or a Green Paper for the future.
  7.47 p.m.
  Mr. Jim Craigen: When my hon. Friend the Minister replies to the debate, will she clarify whether the franchise for the commercial television stations will simply continue for another two and a half years or whether the IBA will be expected to review the operation of existing contracts and, maybe, make some changes?
  Secondly, in connection with the White Paper, will my hon. Friend make special reference to the problems in Scotland and the inevitable transitional problems that are bound to arise immediately after 1981?
  7.48 p.m.
  Mr. John MacGregor: I agree very much with what my hon. Friend the Member for Lewes (Mr. Rathbone) said about the comments of the hon. Member for Nottingham, West (Mr. English).
  732
  It is not at all surprising that there should be a poor attendance for this debate. The plain fact is that this is a boring Bill, leaving the House with little choice because the Government have failed to make up their mind.
  I wish to make only one point. Yesterday I disagreed very strongly with the hon. Member for Grimsby (Mr. Mitchell) over my Ten-Minute Bill. Today I am happy to agree with him in his comments about the commercial radio stations.
  I should like to follow what my hon. Friend the Member for Lewes said so persuasively about the need for developing additional commercial radio stations and local radio services as a whole, as quickly as possible and without waiting for interminable delays as a result of the Bill now in front of us.
  I wish to speak about my own area. My only declaration of interest is on behalf of my constituents in Norfolk. Last September the IBA recommended 14 additional commercial radio stations, and Norwich was included as a possibility.
  In Norfolk we have an excellent local daily paper—the Eastern Daily Express—which is one of the most successful and best newspapers outside London. That newspaper demonstrates, with its substantial circulation, the great sense of community and demand for local news in the area. We have, centred in Norwich, the BBC and Anglia Television, which are both excellent in their own ways and spread their coverage over a wide area. However, their coverage of local Norfolk news is limited.
  Having heard much commercial radio in other areas, and having seen the successful development in those areas, which can only be because the stations are responding to keen consumer demand in their areas, I subscribe to the view that this has been a success story. Locally with Radio Orwell, one of the small stations, we see an example of that.
  Norfolk County Council, Norwich City Council, the local university, various other bodies and large numbers of individual consumers have urged that Norfolk should be allowed to have its own local radio station. We have an enormous range of local radio stations. The community spirit, being such as it is, would greatly benefit from such a radio station,

  733
  quite apart from all the other benefits for the community, which have already been elaborated in this debate and which I shall not develop further. It would, in short, provide a valuable additional local service, and it would be provided, as was stressed by the hon. Member for Grimsby and my hon. Friend the Member for Lewes, at no additional public cost. This is an important factor, because we are all aware of the constraints on public expenditure and we must be cautious about urging additional public expenditure in other areas.
  Mrs. Dunwoody: Does the hon. Gentleman accept that advertisers who spend money publicising their products do so for a specific purpose? That purpose is to sell more, and it may be that some of the cost of the advertising could creep on to the cost of the product—or does not the hon. Gentleman accept that argument?
  Mr. MacGregor: The hon. Lady in her intervention and her earlier comments is mistaken about the way in which the process works. If one can expand consumer demand for one's product, as local radio is clearly doing, not only in respect of products but in providing a service of advertising in respect of ordinary local householders, that must have an effect. If they wish to do these things for themselves, advertisers—let us assume that they are manufacturing or commercial organisations—can expand the demand for their products. This will provide a service for those who buy the products, and it often provides additional jobs for others in the areas concerned. Furthermore, it is clear that this is a matter to which the consumer will respond and something he wishes to have. Indeed, if he did not wish to do so, he would not be listening to the programme and it would not be successful because advertisers would not wish to use the programme.
  Advertising is part of the process of a thriving economy. If it adds even a minute proportion—and in local radio it must be minute in relation to the cost—it can often bring down costs by expanding the total market and, therefore, the volume. Therefore, the point is not as simple as the hon. Lady thinks. However, I do not wish to elaborate too much
  734
  in that direction because I wish to be brief.
  When many local organisations are urging that we should have a local independent radio station to provide this additional service, it is depressing that there continues to be delay because of the lack of decisions on the White Paper. I was interested in what my hon. Friend the Member for Lewes said in that respect.
  I was told by a Home Office Minister, in response to a recent Written Question, that the development of local radio services must await the Government's White Paper proposals. My hon. Friend has made it clear that that is not necessarily so but that it is simply a question of decision by the Government. I hope that the Minister, in her reply, will say that she will consider the point mentioned by my hon. Friend the Member for Lewes—namely, that if there are to be further delays—and I suspect from past experience that they will be longer than Ministers at present pretend—the Government will speed up the process, as requested by the IBA, to facilitate the extension of commercial radio stations.
  7.55 p.m.
  Mr. Jim Lester: I apologise to the House for the fact that I was not present earlier in the debate and for the fact that I have come in only at this late stage. I have returned from Southern Africa only in the last two hours, and I would not have spoken in the debate if I had not heard the hon. Member for Nottingham, West (Mr. English) complain that too few Tories had taken part. I hope that I shall redress that balance in about two minutes flat.
  In the past few weeks I have been watching Zambian, Rhodesian and Southern African television, and I support the view that the BBC and ITV provide one of the best ranges of television in the world.
  However, there is one serious major deficiency. I refer to the coverage received in the East Midlands. In this context I support what I call my hon. Friends who represent the area, including the hon. Members for Nottingham, West and for Derby, North (Mr. Whitehead), in pressing upon the Minister the need to recognise the desire of the people of the East

  735
  Midlands—which, in turn, has an effect on the commercial viability of the area—in seeking to establish a separate commercial franchise and to persuade the BBC to set up a separate studio.
  This is no sense said in animosity to existing television companies or to the West Midlands. Anybody who knows the area recognises that it has a population of 8 million, covering such a huge area as the country's second largest city and the Black Country, as well as such important cities as Nottingham, Derby and Leicester. It is not fair on either side of the motorway, if we use that as the dividing line, to try to put together one television station which can give adequate and fair coverage to both areas.
  I must emphasise a second consideration. As we have seen commercial television develop, there is a need, if we want variety and interest, to establish a better balance between the national network companies and the smaller regional companies. Most of us who study these matters know that many people's favourite programmes are those with a distinct regional flavour. I refer to the "Puffer-boats" in Scotland, "Coronation Street" in Manchester and other programmes. Those programmes, which have a distinct regional flavour, always attract the imagination and provide better television. With the establishment of an East Midlands television station, I should like to see additional impetus in that direction.
  When we consider the fact that people who live in Mansfield—which is only, so to speak, half way up the county—are unable to see Nottingham Forest Football Club winning its matches because they can receive only Yorkshire Television, which picks on football matches played in obscure parts of the North, we realise what a serious cultural deprivation exists in my constituency. When we also consider that in the East Midlands we have been able to breed such people as Robin Hood, D. H. Lawrence and Lord Byron, the mind boggles at the sort of television programmes that we could sustain from such a regional input.
  I realise that this is not the place to argue the full case for East Midlands television, but it gives me an opportunity to support those who have spoken in
  736
  favour of it and to set down markers for the kind of action for which we shall be pressing in future.
  7.58 p.m.
  Mr. Julian Critchley: This mini Bill is the Government's rather sad substitute for "the great debate" on broadcasting that we were promised after publication of the Annan Report last year. Whatever happened to that mysterious White Paper?
  This evening we have enjoyed some debate but we have avoided all the decisions that matter. The failure of the Government to make up their mind is doing much harm to broadcasting. The BBC is left without money and in suspense—what will happen to local radio?—while investment in the commercial companies is made more difficult as their future becomes, in the long term, even more uncertain.
  Hypocrisy is the English vice and our attitude to broadcasting is no exception to this rule. As politicians we have always held the view that broadcasting is far too important to be left simply to the broadcasters. We are shocked when we realise the extent to which foreigners interfere in their own broadcasting systems. Yet we disguise our hypocrisy behind the facade of the institutions that we have created to administer broadcasting, the BBC and the IBA, and we do so in our name.
  Lord Reith may have seen off the original Winston Churchill at the time of the General Strike in the name of freedom, but it is this House that fixes the BBC's licence fee, still the best bargain in Europe, and the interval between increases. Heaven help the BBC if there is an election in the offing.
  We grant and extend the charter and we extend the life of the IBA and other companies. We vacillate over the fourth channel and appoint the workers and intellectuals who made up the Annan Committee. We interfere but we do not act.
  Why are we as politicians suspicious of broadcasters? It is because we fear their power. We Conservatives are certainly not an egalitarian party, but we find it had to decide between Locke and Hobbes—between freedom and authority. Socialists share the same problem. Some favour freedom; more, authority. We

  737
  are both highly sensitive to slights, real and imaginary, and we envy the irresponsibility of the broadcasters and their power. In reality, therefore, we make them responsible to us. Why else do we persevere with party political broadcasts, which no one watches and which achieve nothing save to lower our prestige and boost the sale of hot, milky drinks?
  With regard to broadcasting, we Conservatives have inclined more to freedom than authority. That is not true of the other side of the House. My right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) has mentioned the ratchet effect in politics whereby the Right acquiesces in the changes made by the Left, yet the ratchet effect has worked the other way in broadcasting. It was the Conservatives who broke the monopoly of the BBC in the 1950s—and we were savagely attacked for doing so. In the 1970s we broke the monopoly of BBC radio. In the 1980s we shall give the fourth channel to the IBA and in the 1990s we might even do something for the hon. Member for Derby, North (Mr. Whitehead).
  Why have the Government not given the fourth channel to ITV, which is the obvious, equitable and economical solution? I believe that they would have done so already had not the programme companies, especially the "big five" been so rich and successful. About £50 million a year is passed over through the levy to the Exchequer as well as 80p in every pound of profit. As Sir Denis Forman said recently,
  "in today's political climate, nothing fails like success".
  Had the companies lost money, no doubt the Government would already have stepped in with sympathy, subsidy and support.
  What have been the effects of the Government's failure to make up their mind? I must briefly trace what has happened since 1968. In 1969, nine years ago next June. Lord Annan was asked by the then Prime Minister to look into the future of broadcasting. In 1970, he was stood down by my right hon. Friend the Member for Sidcup (Mr. Heath). In April 1974, Roy Jenkins recalled his Lordship to the colours.
  For three years, the broadcasters undertook an exercise in rigorous self-examination. In March 1977, Lord Annan reported—only
  738
  six weeks late. In May last year, the report was debated in this House and in another place and we were told that "the great debate" was about to begin. We were also told that we could expect a White Paper in the autumn. When the leaves began to turn we were told that the White Paper would be published early in the new year. At Christmas we were told to expect its publication in February. In April we find ourselves in a silent spring with neither sight nor sound of the White Paper.
  The lifespan of the broadcasting authorities, already extended by one year to 1979, is to be stretched for a further two years and five months until the end of 1981 so that the Cabinet may make up its collective mind. Ministers are taking the easy way out.
  Mr. English: I suggested earlier that the Conservative Party had issued a one-line Whip to its supporters. This may or may not be correct, but I understood that the Conservatives were not opposing the Bill. If that is so, they must take some responsibility for the deferment.
  Mr. Critchley: The hon. Gentleman's logic is extremely difficult to follow, but his heart is in the right place. We are waiting for the Cabinet to make up its collective mind.
  Mr. English: And the Shadow Cabinet.
  Mr. Critchley: Because the Cabinet is unable to make up its collective mind, it is obliged to take the easy way out, which is why the Minister is here. The Cabinet's way is easy for them, but, thank goodness, a General Election must intervene.
  In the meantime, the situation in broadcasting goes from bad to worse. The morale of the BBC has dropped to the same level as its funds. Its staff has been squeezed horribly by three years of wage restraint and the revenue from the licence fee is clearly inadequate. Has the Minister a view on the desirability of adopting new methods of raising revenue? What does she feel about indexing? We know what Annan thinks about indexing, but not what the Home Secretary feels about it. Would he consider some form of arm's length assessment of the BBC's needs by three wise men? The BBC

  739
  is an independent estate and should be funded as of right.
  What adverse effect has the Government's vacillation had upon the commercial network? Uncertainty is harmful to television. If we leave aside the question of investment—and many millions ought to be invested in jobs and equipment—the staff of the companies have no certainty for whom they will be working in four years' time and the management has no certainty that it will be working at all.
  The recallocation of the franchises in the late 1960s took 18 months. It is now to take four years—with all the consequent uncertainty. And for how much longer will the IBA be kept in suspense because the Government cannot decide what to do with the fourth channel?
  I suspect that the Home Secretary knows that an Open Broadcasting Authority would be an expensive nonsense which would need subvention and support. On the other hand, a local broadcasting authority and an OBA are fully in the woolly and idealistic traditions of Fabian Socialism. But, even so, how are they to be financed? Only by an Exchequer grant. Will the Home Secretary be able to persuade his more atavistic friends in the Cabinet to see sense? Will he be able to say "No" to the hon. Member for Derby, North? I hope so.
  What a serial all this would make—a soap opera to end all soap operas. It would be funny were it not so sad. And what a cast for this long running extravaganza: the Prime Minister would be played by Mr. Bruce Forsyth, the Home Secretary by Mr. Harry Worth and the hon. Member for Derby, North by Miss Vanessa Redgrave.
  8.8 p.m.
  Dr. Summerskill: I am amazed that the hon. Member for Aldershot (Mr. Critchley) should finish on that note, although having heard so many of his speeches at the Oxford Union perhaps I should have been prepared for that peroration. I am sorry that I was not.
  I described the Bill earlier as having limited purposes, but it has certainly served the purpose of making it possible for the House to have a debate on the
  740
  whole of broadcasting. I can assure all hon. Members who have spoken that their comments have been noted in connection with the Government's eventual White Paper on the Annan Report. It has been emphasised repeatedly, as in Question Time today, that the House is waiting eagerly for the White Paper, but there were 174 recommendations in the report, many of which were highly controversial, and the House has not been exactly unanimous in its views.
  Although there is a clamour for the White Paper in connection with the Bill, that alone would not have made the Bill unnecessary. As well as the White Paper, there would need to be substantial legislation, based on the White Paper's proposals, passed through both Houses and brought into effect. All that would be necessary and it would affect broadcasting for at least the next 10 years. All that would be necessary to make the Bill unnecessary. It is not merely the magic of a White Paper that would make the Bill unnecessary. However, we are proceeding as quickly as possible with drawing up the White Paper. Everything that has been said today will be taken into consideration, including the 33 channels mentioned by my hon. Friend the Member for Grimsby (Mr. Mitchell).
  The official Opposition have oversimplified the problems facing us with the Annan Report. I did not hear a profound analysis of the Annan Report, but perhaps that was not intended by the right hon. Member for Penrith and The Border (Mr. Whitelaw), who did me the courtesy of telling me that he would not be present for my reply. I had the impression that the right hon. Gentleman felt that a decision on the fourth channel, for example, would be easy to make. I do not apologise for saying that the Government do not regard it as an easy decision. That applies to many other decisions on the Annan Report. My hon. Friend the Member for Crewe (Mrs. Dunwoody) made that point in her sagacious speech.
  The right hon. Gentleman applauded the Annan Committee's endorsement of the concept of the broadcasting authority, of broadcasting being run by public authorities. As he knows, my right hon. Friend made it clear in the debate on the Annan Report on 23rd May 1977 that

  741
  the Government believe that it is right that public authorities should run broadcasting.
  The right hon. Gentleman referred to programme standards, as have other hon. Members. I agree with the right hon. Gentleman that it is a matter for the broadcasting authorities, but that is not to say that the House cannot express strongly its views on programme standards. I hope that it will continue to do so. I am sure that the authorities will take the views of the House into consideration even if they do not comply with them.
  The hon. Member for Howden (Sir P. Bryan) and my hon. Friend the Member for Derby, North (Mr. Whitehead) suggested that we should have taken the opportunity presented by the Bill to amend more radically Section 4 of the 1976 Act. I appreciate the anomalous position in which the hon. Gentleman found himself and will be finding himself. A similar anomalous position could affect other hon. Members, including my hon. Friend the Member for Grimsby. On the other hand, views about Section 4(2) are not unanimous in regarding it as self-evidently wrongly expressed and wrong in its intention. I believe that the Annan Committee suggested—this is an example—that the BBC and the IBA should not be allowed to use their own transmissions to make propaganda for their own cause. I know that that was not the point specifically put forward by the hon. Member for Howden about his predicament, but I can assure the House that there are considerations on many sides to be taken into account as regards Section 4(2). The Government will take them all into account when they formulate their proposals.
  Mr. Critchley: I am instructed to say that the Opposition in Committee will be moving amendments to alter the section and we look forward to the assistance of many hon. Members on both sides of the Committee.
  Dr. Summerskill: We shall have to wait to hear what the Chairman of the Committee says about such amendments. I was about to make that point to my hon. Friend the Member for Putney (Mr. Jenkins), who was concerned about being able to amend the date. As far as I can see, he will be able to amend the date,
  742
  but the final decision on that, and on any other amendments, must remain with the Chairman.
  Mr. Johnson Smith: There are difficulties, and I do not expect the hon. Lady to spell them out this evening. However, I hope that the Government will have more of an open mind. It is not necessary to go as far as is suggested by some, namely, to remove all the restrictions on Members of Parliament who happen to be directors or to hold official positions in commercial radio or television companies. I believe that there is a half way house that would preserve the proper dignity of a Member who is, for example, a director or the holder of an official position in such a company.
  Dr. Summerskill: I am sure that that view will be taken into consideration.
  My hon. Friends the Members for Derby, North and Glasgow, Maryhill (Mr. Craigen) pointed out that because we have extended the right of the IBA it does not follow that existing franchises have to continue either in their present form or with the existing contractors. That is true. However, any changes in the ITV franchise areas—for example, to accommodate a new company to provide a separate East Midlands service—would, on the basis of proposals being mooted, mean adjustments in the franchise areas of the three existing programme contractors, namely, ATV, Anglia and Yorkshire. That would be primarily the responsibility of the IBA. The ITV franchise arrangements in the longer term will need to be considered in the context of decisions about the future structure of ITV generally.
  The hon. Member for Merioneth (Mr. Thomas) referred to the fourth channel in Wales. The Government remain committed to their acceptance in principle of the recommendation that that channel be used to provide a service in which Welsh language programmes would be given priority. The Government hope soon to receive the report of the Home Office working party, which has been asked to consider and recommend how progress might be made with the project. I understand that the working party is taking into account both the Siberry Working Party Report and the Annan Committee's relevant recommendations, and will proceed

  743
  on the basis of outlining the possibilities and financial implications of various alternative courses of action.
  Mr. English: My hon. Friend was studiously neutral in her remarks about the East Midlands, as one would expect. Does she mean that that neutrality has been conveyed to the IBA? Has the IBA been told that it is solely up to it whether the franchise is renewed now or in two years' time?
  Dr. Summerskill: I think that my hon. Friend could interpret what I said to mean that the franchise areas are the responsibility of the IBA.
  Mr. Whitehead: Does my hon. Friend agree that it would be a good thing if the Government were to convey the strong feeling on both sides of the House that has been expressed today that the sort of consultation that we have called for should take place at the earliest opportunity, that is, beginning tomorrow or the day after?
  Dr. Summerskill: I cannot guarantee the time, but I take note of that for which my hon. Friend has asked.
  Mr. English: It has also been asked for by hon. Members on the Opposition Benches.
  Mr. D. E. Thomas: Will the hon. Lady confirm that the Government expect to make an announcement about the fourth channel in Wales before the publication of the White Paper?
  Dr. Summerskill: These two matters are closely interrelated, as I am sure the hon. Gentleman appreciates. As I am unable to say exactly when the White Paper will come out, clearly I am unable to say when the other matter will be announced. I estimate that the two matters will be closely related in the way that the decisions are announced.
  The hon. Member for Pudsey (Mr. Shaw) referred to the duplicated coverage of sport on television. I fully appreciate the point and I understand his irritation, as did the Annan Committee, which, I gather, discussed the matter. This is a matter of programme content, which has traditionally been a sphere in which the Government do not intervene. I am sure that the
  744
  House agrees with that. On the other hand, no doubt the broadcasting authorities will have taken note of the hon. Gentleman's views and other views expressed about programme content.
  The hon. Gentleman mentioned that my right hon. Friend, under Section 29 of the 1973 Act, directed the IBA, with the consent of the Treasury and after consulting the chairman of the Authority, to pay half of the Authority's surplus on its 1976–77 television account to the Consolidated Fund. That was not the first time that such a direction had been made. My right hon. Friend has, however, agreed with the chairman of the Authority that discussions should take place between the Home Office and the Authority to try to establish relevant general principles for the Authority's future financial policy. These discussions have started and will, I hope, soon be concluded.
  The hon. Member for Lewes (Mr. Rathbone) asked about Treasury loans to the IBA for local radio purposes. So far two loans, totalling £1·65 million, have been made to the Authority. These loans have not yet been repaid.
  As regards the IBA's staff, the Bill does not entail any increases.
  Mr. Rathbone: It was not so much the loans for local radio as the loans for everything which now exist, and which will be carried forward into the two and a half year extended period. What additional loans will have to be raised during that two and a half year extended period?
  Dr. Summerskill: I do not know whether this is in order, but, as the matter has been raised, presumably I may answer it on Second Reading. The Money Resolution is required because the Independent Broadcasting Authority Act 1973 makes provision for the payment of money out of the Consolidated Fund and from Votes. In particular, it enables voted money to be paid to the IBA in the form of loans not exceeding £2 million at any one time for the purpose of capital expenditure on local radio. Two advances totalling £1·65 million have been made and they have not yet been repaid, as I have just told the hon. Gentleman. Within the Ways and Means Resolution other moneys, which have to be paid into the

  745
  Consolidated Fund, include sums in repayment of loans made to the IBA for capital expenditure on local radio.
  The hon. Gentleman also asked about staff. As I said, the Bill does not entail any increases. Neither the Government nor anyone else can say now with complete certainty whether there will need to be an increase in the Authority's staff during the extension.
  The hon. Gentleman pointed out that the Government could authorise an expansion of independent local radio without fresh legislation. However, we take the view that the question of any additional local radio stations needs to be considered in the context of our proposals for the whole future structure of local radio, and they will obviously be forthcoming in the White Paper.
  Research and the impact of programme services on audiences are matters for the broadcasting organisations, but I assume that they will take note of what the hon. Gentleman suggested.
  Mr. Critchley: Is the hon. Lady going to give us a new date for the White Paper?
  Dr. Summerskill: I cannot at this stage say when the White Paper will be brought before the House.
  Mr. Hugh Jenkins: Will my hon. Friend give way?
  Dr. Summerskill: Perhaps I may finish this sentence. As my right hon. Friend said in the House this afternoon and as I have said tonight, we are aware of the great impatience of most hon. Members on both sides of the House—I would not say all; it has not been unanimous—for a quick publication of the White Paper. I cannot say more than that this will be done as soon as possible.
  Mr. Hugh Jenkins: Some of us are a little worried about the White Paper, because we do not know whether we shall be pleased to see it until we see it. I wonder whether my hon. Friend could clarify one point. I understand that it is expected in the not too distant future. Could she say whether the not too distant future is a period to be calculated in weeks rather than months?
  Dr. Summerskill: I am not prepared to say that. My hon. Friend is putting
  746
  words into my mouth if he expects me to say that.
  I ask the House to give a two and a half year extension to the life of the IBA, to accept the Bill and to regard it as necessary—
  Mr. Johnson Smith: I apologise for intervening, but I felt that the hon. Lady was coming to almost the last sentence of her speech. Will she reassure the House that the Government are giving the most serious and close attention to the post-Annan proposals of the IBA regarding the future of the fourth channel—the proposals that I mentioned earlier for ITV2?
  Dr. Summerskill: I assure the hon. Gentleman that close attention is being given to that matter and to all the points that have been made in the debate on the general future of broadcasting. With that—
  Mr. Rathbone: This is not a new point. There was the question of the inter-relationship between yesterday's White Paper on nationalised industries and the way that could impinge upon the freedom of broadcasting. It may be too complicated a question to answer at this moment, but I think that the answer is an important one that the House would like to hear.
  Dr. Summerskill: That is an important point. As the White Paper on Annan has yet to be laid before the House, and as the White Paper on nationalised industries was published yesterday, I am sure that the White Paper on Annan will take account of the points made in that other White Paper.
  Question put and agreed to.
  Bill accordingly read a Second time.
  Bill committed to a Standing Committee pursuant to Standing Order No. 40(Committal of Bills.)

  INDEPENDENT BROADCASTING AUTHORITY BILL

    INDEPENDENT BROADCASTING AUTHORITY (MONEY)
    Queen's Recommendation having been signified—
    Resolved,
    That, for the purposes of any Act of the present Session to extend until 31st December 1981 the period during which television and

    747
    local sound broadcasting services are to be provided by the Independent Broadcasting Authority, it is expedient to authorise the payment—

    (a) out of money provided by Parliament of any increase in the sums payable under any other Act out of such money; and

    (b) out of the Consolidated Fund of any increase in the sums payable under any other Act out of that Fund, where the increase is attributable to provisions of that Act extending the said period until that date.—[Mrs. Ann Taylor.]

    WAYS AND MEANS

      INDEPENDENT BROADCASTING AUTHORITY
      Resolved,
      That, for the purposes of any Act of the present Session to extend until 31st December 1981 the period during which television and local sound broadcasting services are to be provided by the Independent Broadcasting Authority, it is expedient to authorise the payment into the Consolidated Fund of any increase, in the sums payable into that Fund under any other Act, which is attributable to provisions of that Act extending the said period until that date.—[Mrs. Ann Taylor.]

  CO-OPERATIVE DEVELOPMENT AGENCY BILL
  Order for Second Reading read.
  8.27 p.m.
  The Under-Secretary of State for Industry (Mr. Bob Cryer): I beg to move, That the Bill be now read a Second time.
  I want, first, to say something about the background to this short but very important Bill, which is highly relevant to our national situation. I shall then go on to describe in more detail what it contains and what we are seeking to achieve by placing, the Bill before the House.
  The co-operative movement has long been with us and has a proud history based on solid achievement. It began in the nineteenth century as an alternative form of endeavour to the exploitation of capitalism, which had many unacceptable faces in the nineteenth century. Robert Owen initiated many co-operative endeavours, but it was George Holyoake who persuaded the Rochdale Pioneers to establish the first co-operative shop, which was opened in Toad Lane, Rochdale, in 1844 when the Rochdale Society of Equitable Pioneers was first registered. The founders of the Pioneers gave birth to ideas which proved an inspiration to those who came after. From these small beginnings a world-wide movement has developed. The co-operative principles are generally recognised as an important concept which gives the contemporary movement its characteristic form.
  Paragraph 6 on page 2 of the White Paper sets out the principles of co-operation extremely well. It says:
  "Essential to co-operative philosophy is the idea of equal partners working together for the common good and, although there are significant differences of constitution and style among the various organisations within the Co-operative Movement, they share certain basic values and principles. The first co-operatives had as their objective the creation of a just and fairer society. The welfare of and service to the community of members rather than the pursuit of profit for distribution to investors of capital remains the prime motivation of Co-operation. In a co-operative or common ownership enterprise the reward of working together, in production, distribution and service activities accrues directly to the members actually creating the prosperity of the enterprise. Earned surplus,

  749
  or savings, is applied to their collective benefit or democratically distributed to them in the form of dividend."
  The range of co-operative activities is very large. Some sectors of co-operation have prospered; others have declined. The overall picture is one of successful achievement, but inevitably it is one of fluctuating fortunes rather than steady inexorable improvement. There are more than 200 retail consumer societies in membership of the Co-operative Union, with a combined membership of some 10½ million. Its annual turnover represents over 7 per cent. of the total national retail trade. The Co-operative Wholesale Society is the central organisation set up by the retail societies to buy collectively on their behalf, engage in manufacturing and provide technical and advisory services for them. The CWS had a 1976 turnover of more than £1,266 million. The Co-operative Bank and Co-operative Insurance Society are wholly owned subsidiaries of the CWS. These are large and successful organisations operating under the inspiration of the co-operative principles.
  As the Labour Party said in "Labour's Programme 1973",
  "Labour's commitment to public ownership does not mean a rigid adherence to the 1940's form of nationalisation. The best examples of our wider view is the Co-operative Movement where 11 million people join together to operate a huge sector in the British economy which has a vast potential for further development."
  Closer to my departmental interest there are two relatively small organisations representing co-operation in the industrial field. First there is the Co-operative Productive Federation, which is the trade association for traditional producer co-operatives. Of the 20 or so societies still operating in this country, about eight are in membership of the CPF. Secondly, there is the more recently formed Industrial Common Ownership Movement inspired by the very successful Scott Bader Commonwealth at Wollaston, in which about 400 co-operators are involved. My Department is supporting the work of ICOM by means of grants under the Industrial Common Ownership Act 1976, which, hon. Members will recall, was a Private Member's Bill promoted by my hon. Friend the Member for Consett (Mr. Watkins).
  750
  In agriculture, the Central Council for Agricultural and Horticultural Co-operation was set up in 1967 as a statutory body to encourage and promote co-operation in production and marketing in that sector and to act as agents of the Government in administering a grant scheme. Over 400 agricultural co-operative societies in Britain belong to the Federation of Agricultural Co-operatives (UK) Limited. Other central organisations represent the interests of co-operation in the fishing industry, housing and credit unions.
  Certainly, there are already a number of representative organisations in the various co-operative sectors. But over a period of years—a decade and more—the need has been felt for a new agency within the co-operative movement; the need for a body to keep a general watch over the whole range of co-operative activities, to provide support and to co-ordinate a co-operative viewpoint. This need was eloquently expressed within the Co-operative Party and discussed at successive co-operative congresses. All this led to the call for the Government to establish a Co-operative Development Agency.
  In March 1977, my right hon. Friend the Minister of State, Department of Industry, chaired the first meeting of a working group set up to develop further the idea of a Co-operative Development Agency as a body to give advice and guidance to co-operatives of whatever kind and as one which would be able to speak for the co-operative movement as a whole. My right hon. Friend is prevented from being here tonight owing to his being abroad on Government business in the Far East. I know that he would want me to pay tribute to the members of the working group, who came from many sectors of co-operative activity and from Government Departments interested in aspects of co-operation, for the way they set about their task so that their report was able to be published in October, some seven months after their first meeting.
  The report did not contain a unanimous recommendation, although there was a good measure of agreement among the co-operative movement representatives on the working group. It is, perhaps, not entirely surprising that there

  751
  should be two views on some of the detailed recomendations. These were published side by side in the report and both were very carefully considered by the Government. The Bill seeks to implement the recommendations embodied in the majority report.
  It was certainly a useful endeavour to involve co-operators in the formulation of the White Paper. While there was broad agreement, the minority report shows a slightly different emphasis and demonstrates that differing views can be registered, a point which could perhaps be usefully noted by several hon. Members who appear to have studiously avoided such a concept in recent Select Committee reports.
  Mr. Mike Thomas rose—
  Mr. Cryer: I shall give way to my hon. Friend at the end of these few sentences. The crucial point of difference between the majority and minority points of view concerned the method of appointing the members of the Agency. The minority report by tour members of the working group from some of the smaller, relatively recently founded and less-developed sectors of co-operative activity—housing, credit unions and common ownership—proposed that not less than one-half of the members should be appointed by participating co-operative organisations on an equal basis whereby each organisation, regardless of size, would appoint one member.
  All the larger, longer-established co-operative organisations objected to the proposal on the grounds that it ignored the disparities of size between them and would require too large and unwieldy a membership of the Agency. The majority report also had the support of some of the organisations representing the less-developed sectors of activity—producer co-operatives, credit unions, agricultural co-operatives and fisheries co-operatives—and of the member from USDAW, representing the trade union viewpoint.
  After very careful consideration, the Government decided to accept the majority recommendation that the power to make appointments to the agency should vest in the Secretary of State, who should be required to consult and seek nominations from all classes of co-operative
  752
  organisation. This will ensure as far as possible that the governing board of the Agency comprehends the whole range of the movement's interests.
  Mr. Mike Thomas: I am grateful to my hon. Friend for giving way, and I hope that he will forgive me for intervening. As he has gratuitously introduced into this matter the question of Select Committees, perhaps he will explain why my right hon. Friend the Secretary of State has accepted the report which every one of the Labour members of the Select Committee on Nationalised Industries accepted and signed, not as some shabby compromise but as the view they took. My right hon. Friend has now introduced a policy exactly based on that report, with two exceptions. One concerns the iron-making facility at Scunthorpe and the other the whole question of the Port Talbot expansion, which we recommended we should go ahead with. Why does not my hon. Friend feel that a night like this, when we are discussing co-operative matters, is an opportunity to raise the whole question?
  Mr. Cryer: My hon. Friend shows a great deal of sensitivity on these matters. I was simply pointing out that in a report which we have published, and for which we are grateful to all the participants it was possible for a minority view to be extended. All that I was saying was that in recent weeks a point of view had been expressed that unanimous reports were universally desirable. I am merely making the point that here we have a report which shows a divergence of view. In my estimation, that does not diminish the report but may improve and strengthen it.
  Mr. Thomas: We do not want to labour this, but what is the purpose of having a minority report when everyone is agreed and there is no minority view?
  Mr. Cryer: As my hon. Friend says, we do not want to labour this point, and I know that we want to make progress.
  I have spoken so far, and at some length, of what led up to the drafting of the Bill, which sets the measure in context. I turn now to the Bill itself.
  The object of the Bill is to establish a Co-operative Development Agency. Clause 1 provides for the Agency to be

  753
  established as a corporate body to perform the functions specified in Clause 2. The clause provides that the Agency will have a chairman and other members—between a minimum of four and a maximum of eight—who will be appointed by the Secretary of State. Before making such appointments, the Secretary of State must consult persons appearing to him to represent the interests of the co-operative movement. This follows the working group's recommendation that he should consult and seek nominations from all classes of co-operative organisation. I should point out that there is no requirement to appoint only people thus nominated.
  As paragraph 37 of the working group's report pointed out, the choice of chairman will be of special importance. He or she must be acceptable to the movement as a whole, command its confidence and be capable of engaging the attention of Ministers and their Departments. The report goes on to suggest that it might be desirable if the chairman were someone who had no direct responsibilities towards any particular section of the movement, so that the Agency, in its formative years, would establish an individual identity and secure the confidence of all sections.
  We shall be looking for somebody of considerable ability and standing to undertake this important role. The co-operative movement recognises the need for a successful Agency, and that success will inevitably depend on the quality of its leadership. There will be wide consultation about this and the other appointments and the choices will be made with great care.
  Clause 1 declares that the Agency is not to be regarded as a Crown servant or agent or as enjoying Crown status, privilege or immunity; nor will it be exempt from taxes or similar charges. Clause 1(6) gives effect to the provisions of the Schedule which refer to the appointment and tenure of office of members of the Agency, their remuneration, the disqualification of members for the House of Commons and Northern Ireland Assembly and the proceedings of the Agency.
  The meat of the Bill is in Clause 2, which specifies the Agency's functions. These are designed to further the interests of the co-operative movement generally and are based on the majority recommendations
  754
  of the working group's report. The report identified a need for a statutory body to watch over the range of the co-operative movement's many activities and to formulate views and attitudes which would reflect and promote the interests of the movement as a whole.
  The Agency will be expected to work with existing co-operative organisations—which share a common faith in the general co-operative principles but which have widely separate interests—and to co-ordinate and facilitate the development of co-operative activities. The development of a working relationship between the Agency and the existing representative organisations will require each to be considerate of the interests of the other.
  The Agency should not do those things which are better left with or remitted to co-operative organisations or statutory bodies already in existence. Nor should the Agency duplicate functions which are already being carried out adequately elsewhere.
  The working group identified the need to provide new machinery to co-ordinate and facilitate the development of co-operation, firstly in those areas of economic activity that it already serves and also in possible new areas. The Agency will need to gather information from co-operative undertakings at home and abroad. It will need to undertake research studies to show how the co-operative approach might serve the public interest in particular situations and circumstances. The working group concluded that the identification of projects to be undertaken on a co-operative basis would stem mainly from requests for advice or guidance. But the Agency will have power to take the initiative in proposing co-operative projects where its studies and research show that there is a worthwhile opportunity.
  The role of the Agency is advisory and promotional. It will be able to give guidance to individuals, co-operatives and co-operative representative organisations of many kinds. The Agency will appraise and evaluate projects and give advice accordingly. The aim is to encourage the development of successful co-operatives. Co-operation is not seen as a cure-all in every circumstance. The so-called "rescue" cases will continue to have to

  755
  be considered on their merits under the existing legislative provisions as and when they arise.
  The rescues of Meriden and KME, for example, have preserved a number of jobs. Meriden is now the last significant producer of motor cycles in the country, and both co-ops have survived difficulties caused by the once-redundant plant, machinery and people becoming some of the left-over scraps of capitalism. These rescues stimulated great interest in co-operative forms of production.
  The Agency could have some part to play in some cases, but the working group recognised that turning failure into success in this way is fighting against heavy odds. The emphasis will be on founding co-operatives after a thorough appraisal of the prospect for viability. The Agency will take into account the importance of ensuring proper organisation, management and financing. The Agency will not dispose of public funds for investment in co-operative ventures. But I would expect the Agency to be able to facilitate finance for sound co-operative projects by helping with the applicant's presentation of his case and guiding him to the source of finance appropriate to his requirements.
  The Department has, for instance, had several instances where applications have been made for regional financial assistance from putative co-operatives which has stretched the resources of the Department in assisting and assessing the cases. In one instance, a co-operative was proposed which was being promoted largely by a man who was a director of five companies in liquidation. He proposed selling the product to a yet further business that he owned. On the other hand, the workers were sincere and totally open. By working through an agency of the movement, such situations of potential exploitation and difficulty can thus be avoided.
  One of the most important functions of the Agency will be to provide a forum for discussion and debate within the co-operative movement. It soon became apparent when the working group was formed that in some cases different branches of the co-operative movement were virtually unaware of each other's problems attitudes and aspirations. If
  756
  the Agency is to achieve its representational objectives adequately, it will be necessary to reconcile differences of interest and approach so that the Agency can represent a common co-operative viewpoint on matters of major importance. This may take some time. The working group was confident that this could be done and that the Agency would be able to exercise a strong and persuasive influence in resolving differences of opinion and conflicts of interest.
  Clause 4 of the Bill authorises the Secretary of State to make grants to the Agency up to a maximum total of £900,000. The working group estimated the annual cost of running the Agency to be about £300,000 and recommended that the Government should bear as launching finance the whole of the estimated cost of establishing and running it for three years. The Government accepted that recommendation. After this formative period, during which the Agency should develop its own sense of corporate purpose, its finances will be expected to derive essentially from voluntary contributions from the co-operative movement and income generated by the charging of fees for the Agency's services. The Secretary of State is also empowered to increase the maximum total grant within a ceiling figure of £1·5 million by order made by Statutory Instrument, which would have to be approved by resolution of the House.
  Clause 5 contains the accounts and auditing provisions relating to the Agency. There is an important element of accountability to Parliament, and by virtue of Clause 6 the Agency will have to make an annual report on its operations to the Secretary of State, who will be under a duty to lay copies before both Houses of Parliament. I hope that in future years Parliament will find time to debate these annual reports on how the Agency is progressing. The remaining clauses deal with the technical financial provisions, short title and extent of the Bill.
  There is one schedule, which is given effect by Clause 1(6). The schedule contains the detailed provisions as to the appointment, tenure of office and remuneration of members of the Agency. It disqualifies members of the Agency from membership of the House of Commons and the Northern Ireland Assembly. It

  757
  also deals with the proceedings of the Agency.
  I hope that the House will agree that the Bill is an important step, and I commend it to the House and hope that it commands the overwhelming support of hon. Members.
  8.48 p.m.
  Mr. Kenneth Clarke: The Opposition give a cautious welcome to the Bill. We are not particularly cautious about the proposed Agency so long as the appointments to it are reasonably balanced. We are cautious about the Government's and the Labour movement's attitude to the development of worker co-operatives. The Conservative Party is favourably disposed towards worker co-operatives or worker-owned enterprises so long as they operate in the market on the same terms as their competitors.
  We welcome co-operatives that engage in commercially sound activities, raise their capital from their members or the market, and do not rely on public subsidies or preferential treatment against their competitors. If the new Agency promotes the further development in this country of this form of private enterprise I would expect it to receive active support from a Conservative Government.
  We disapprove strongly of the Government's record of giving taxpayers' money to uncompetitive worker co-operatives founded by illegal sit-ins or industrial action and promoted for political rather than economic reasons. If there was any hint in the Bill that the agency might result in a return to the "Bennery" that poured money into Meriden, Kirkby and the Scottish Daily News we would oppose it tooth and nail.
  I am sure that many Labour Members, including some of those present tonight, are disappointed that the Bill gives the Agency no powers of that kind so far as we can detect. It appears that a lack of a parliamentary majority and an approaching General Election are preventing the Labour Party for the time being from achieving its real aim of promoting worker co-operatives as a step to Socialism. I see that some of the more Socialist Members on the Labour Benches nod in agreement at their disappointment at the Bill which does not further the aims they would wish to realise.
  758
  So the Bill, which must be something of a disappointment for the Minister who has presented it, given his known personal views, is setting up an Agency that has only a broadly defined advisory and promotional role. We on this side of the House are reassured to see, and delighted to hear the Minister making it clear to us, that it has no powers at all to invest public money directly in any commercial activities or engage in any commercial activity itself. Clause 3 seems to cover every possibility of this particular Minister being able to persuade the Agency to divert any public money into co-operatives that he favours. In Committee we shall try to make sure that it is absolutely watertight and that there is no question of subsidy finding its way to favoured political projects through this measure.
  We hope, therefore, that, given that what is set up is an advisory and promotional body in the field of worker co-operatives with serious commercial purposes, it will commend itself to the co-operative movement, and that it will commend itself as far as possible to all sections of the co-operative movement. As the Minister pointed out, one of the difficulties that the working group very helpfully faced was that there is, in fact, a wide range of activity within the present co-operative movement and somewhat of a contract between the long-established, very successful and, therefore, somewhat dominant, retail societies and the Co-operative Wholesale Society, on the one hand, and some of the newer developments, on the other.
  One has no whatsoever towards the retail societies and the Co-operative Wholesale Society, which we hope will derive considerable benefit from and will contribute a great deal to this Agency, but I am sure that some of the hon. Members present who will be trying to catch the eye of the Chair and who are closely associated with the movement will not think that we are disparaging when we say that the major interest is in seeing what can be done to develop areas of worker co-operation and worker common ownership in industrial manufacturing activity in this country.
  One hopes, therefore, that the newer groups will not be under-represented on the new Agency. We accept the working

  759
  group's recommendation, as the Government have done, that the best way of dealing with the wide range of interests that might be represented is to have the members of the Agency appointed by the Government. That will be an effective safeguard against domination by the larger and established bodies if a democratic method of election gave weight to their size, or an under-representation of those bodies if proposals were accepted that the election should be by each individual part of the movement regardless of its size. We think that appointment by the Government could actually be a safeguard, if appointments are wisely made, against the over-domination of the Agency by any particular section of the movement.
  Also, it would be advisable that the members of the Agency look upon themselves, once appointed, as independent people, with an interest in co-operation generally, and not as directly beholden, as elected representatives, to any particular sectional interest.
  Similarly, in the case of the financing, we again agree with the Government in their acceptance of the working group's basic aim, which is that the Agency should ultimately be self-financing, once it has got established, and derive its income from voluntary contributions from the co-operative movement and from fees charged for its services.
  But clearly the Agency cannot be launched satisfactorily on that basis. If it were launched immediately on the basis of self-financing, it would be totally dependent on the large retail societies and the Co-operative Wholesale Society, which are the only organisations with resources that could be looked to to finance an operation of this kind. Therefore, we agree with the basic aim of the Bill, as we see it, and accept the working group's recommendation that the Government should bear the cost of the initial finance for the first three years—which seems to be subject to a proviso that could cover five years—which is the intention of the Bill as it is before the House.
  Having, therefore, agreed with the basic outlines of the Agency, and having stated the basis upon which we are interested in the development of co-operation, what would one expect the
  760
  Agency to promote positively that might be a useful contribution and addition to the structure of industrial activity in this country? I am sure that I shall be only the first in this debate to mention the attention that has recently been directed to, for instance, the Mondragon industrial co-operatives in the Basque area of Spain. I am sure that many hon. Members, and probably most of those present, as they are interested in the subject, have given considerable attention to the recent study by the Anglo-German Foundation for the Study of Industrial Society on the work of the Mondragon co-operatives in Spain.
  There are a large number of very useful lessons to be drawn from that study. I am not saying that the Mondragon experiment can necessarily be directly transplanted to this country, but many lessons can be drawn from it. They are lessons that help to explain why the whole principle of co-operative activity in industrial manufacturing and worker ownership has a great deal to commend itself to Opposition Members as well as to Labour Members.
  The first lesson that I would draw from the recent studies of the Mondragon co-operatives is that the individual workers' financial commitment to the success of the enterprise has been one of the movement's key factors in making for its success in the group of co-operatives that is now flourishing in Northern Spain. New workers entering the co-operatives under the Mondragon umbrella are required to pay at least £1,000 when joining, although it can be deducted from their pay over two years. The profits or losses made by the co-operative are in part added to or deducted from a member's personal holdings. The result has been that some workers in the co-operatives which have largely succeeded have received substantial capital sums themselves, either upon their retirement or upon their change of employment and withdrawal from the co-operative.
  We think that it is instructive to a Government who do not appear to believe in the value of incentives in industry to get the point from Mondragon that the workers' personal financial interest is directly linked to the success of the enterprise achieved under the Mondragon umbrella.
  I am not totally rejecting the common ownership movement that we have here,

  761
  but the Mondragon experience contrasts with the present practice of common ownership, whereby there is no normal direct return to the members themselves. Mondragon is an organisation which creates capitalists and spreads the ownership of the company through workers acquiring a direct personal financial stake in its success. We think that that is commendable.
  Mr. Tom Litterick: Would not the hon. Member at least consider the possibility that one of the keys to the success of the Mondragon projects has been the system of accountability within the managerial system? It operates in such a way that it is impossible for any managers to operate in any remotely authoritarian way: they are accountable and sackable.
  Mr. Clarke: I am grateful to the hon. Member, because the management structure again appears to be one of the keys of success in the Mondragon movement—although I would not interpret it in quite the way that the hon. Gentleman has. The Mondragon co-operatives have all succeeded in providing sophisticated management expertise within a co-operative structure. The managers are appointed by a control board elected by the workers, but once appointed they are in practice left free to get on with the specialised job of management within the policy decisions laid down by the control board.
  As a result, they are certainly not in a totally authoritarian role, as the hon. Member says, because there is a supervisory board elected by the workers. But there are managers, and the specialised techniques of management are recognised in Mondragon. One does not see there the sort of thing that happened in the case of the Meriden co-operative in this country when a co-operative was set up headed by people who were trying to manage but who had no experience of management and who ultimately had to bring in skilled management advice from outside.
  There is a further question which is very relevant to what has made for the success of the Mondragon co-operative and which might apply here, namely, the tightly-disciplined provision of finance to the Mondragon group of co-operatives by the Caja Laboral, which is a co-operative
  762
  bank. Although it is a co-operative bank, closely allied to the movement, it is significant and instructive that there is no question in the financing of Mondragon co-operatives of any kind of Socialist escape from the realities of the market place.
  The Mondragon co-operatives are obliged to recognise the need to produce a return on their capital and to finance future investment in a successful project out of some earned return on capital. Again, that contrasts with some of the experiences that we have had in recent years under this Government.
  Mr. David Watkins: I am listening with interest to the hon. Gentleman's accurate description of the Mondragon management set-up, but is he not aware that there is virtually an identical management set-up and responsibility and control in the Scott Bader Commonwealth, which the Minister mentioned, which is the pioneer of the common ownership-type of co-operative organisation, with neutralised capital? It is difficult to see therefore that the hon. Gentleman is making any effective point at all.
  Mr. Clarke: I accept straightaway that in discussing Mondragon I am not advocating that there should be a blueprint for worker co-operatives or worker ownership in this country which the agency should promote. I was using Mondragon only as a successful example of private enterprise working within the market on a common ownership basis, recognising the needs for financial discipline, for sophisticated management and for a direct personal financial stake by the workers in the co-operative concerned.
  Of course, there are variations. I bear in mind that the hon. Gentleman was the promoter of a common ownership Bill. We did not object to that measure and do not reject that approach. There are other forms, the most notable being the Scott Bader Commonwealth. I try to keep in contact with it through my hon. Friend the Member for Wellingborough (Mr. Fry). He keeps in touch with that Company, which has been successfully pursuing a common ownership approach since 1951. It has had considerable success in chemicals and plastics, and its practices could with profit be followed. One could also refer to the experiences of

  763
  Sunderlandia, the Rowan Community and other examples in this country.
  I refer to the Mondragon experience as something to be explored with profit. I quote it as the most interesting example of foreign experience, which the Agency is specifically enjoined to study. It also explains clearly why there is no inconsistency between our approach to the proper management of the economy and our support for the aims of the Agency.
  One thing that the various forms of worker co-operative have in common is that they are almost all small or medium-sized businesses. The experience everywhere seems to be that there is no advantage in trying to run at a giant enterprise on a co-operative basis. These are small businesses, and the Agency could usefully promote the development of further small businesses. In the present state of the economy, all kinds of small business and entrepreneurship need to be encouraged. It is in the small business sector that we have the most promising hopes of creating the new employment we need if the economic climate can be made right.
  Another thing that these concerns have in common is their various ways of ensuring that there is an identity of interest between the worker and the enterprise within which he works. Given that in this country we all accept that there is an unfortunate tradition of conflict, far too often, between management and shop floor in far too many of our enterprises, however they may be organised, whether nationalised or private, one feature that a co-operative ought to have is a genuine identity of interests between the worker and the enterprise. He should see his own personal advantage as directly related to the success of the whole operation. But these enterprises have to be competitive in a very difficult market, as with every other form of industrial activity that we have in this country.
  Mr. Laurie Pavitt: Would the hon. Gentleman describe the consumer durable Mondragon scheme, employing 3,500 people, as a small co-operative?
  Mr. Clarke: That is the pioneer organisation which started Mondragon, and it is the biggest that I have ever come
  764
  across. It has developed into the largest member of a movement with a large number of smaller co-operatives linked with it. I suppose that 3,500 employees is a reasonable size. It is the biggest domestic appliance manufacturer in Spain and dominates the market. The Scott Bader Commonwealth has 430 people. I know of no bigger enterprise here of that sort.
  One of the features of the co-operative approach is that it must be easier to run an organisation effectively and democratically if its size is kept down to reasonable proportions. I do not see any prospects of British Leyland becoming a worker co-operative as a group in the very near future.
  Dr. Jeremy Bray: The hon. Gentleman is excluding all the major Yugoslav co-operative enterprises, some of which are quite large.
  Mr. Clarke: I have never given them any study. I trust that the Agency, when it gets under way, will perhaps conduct some studies in Yugoslavia and I can then profit from them.
  Mr. Cryer: I should point out that the two co-operatives which the hon. Gentleman was so slighting about—Meriden and KME—comprise between them about 1,500 jobs. One has approximately 700 employees and the other 800 employees. Those are two enterprises which are run on co-operative lines which the hon. Gentleman is excluding from his sights. Does that mean that the Conservative view towards Meriden and KME is so uncharitable that the Conservative Party would see them out of existence at the earliest opportunity?
  Mr. Clarke: I know that the Minister has had to deliver a fairly non-controversial brief. He is dying for me to go on to something controversial. I shall not disappoint him. I shall make some comments about Meriden and Kirkby. I shall point out that the Meriden co-operative destroyed the jobs of people otherwise working for Norton Villiers Triumph Ltd. at Wolverhampton and Small Heath, and the subsidy of the Kirkby co-operative with regard to domestic radiators destroyed the jobs of people working for Penrad in Swansea and in other competitor industries.
  The Minister need not worry I shall make one or two comments about Kirkby

  765
  and Meriden in the concluding part of my speech. Perhaps I shall also not give way so often in order to give other hon. Members the chance of speaking at a reasonable hour.
  That takes me on to the Government's approach, which, before the promotion of this Bill, has been to look upon worker co-operatives as a political objective in themselves and, in particular, as a way of expediting rescues where they are under political pressure from particular areas. We are very doubtful about that. I am very reassured by the report of the working group on a co-operative development agency which on page 5 sets out very clearly the dangers of identifying the idea of worker co-operatives with dead, dying or rescued companies.
  The working group states:
  "In sum, Co-operation offers a potential in motivation. Provided the decision to start a co-operative is founded on a thorough appraisal of the prospect for its viability, and provided the enterprise is properly organised, financed and managed, that potential is there to be realised as the remaining ingredient without which full success cannot be guaranteed. But there is some danger where co-operatives are created out of economic adversity, for the situation is then one of commercial crisis and, important through the rescue may be on general grounds, it is far from an ideal basis on which to promote the reputation of co-operatives generally, or of Co-operation as an alternative form of organisation."
  They are mild comments, but they are the kind of comments that we have been making throughout in our strictures on the Government's support of Meriden and Kirkby, both of them born out of industrial pressure, sit ins and the seizure of property supported very heavily and politically by the Left wing of the Labour Party within this House.
  Meriden, in fact, thrust itself into the motor cycle business and put men out of work in what would otherwise have been a rescue operation conducted under the umbrella of Norton Villiers Triumph Ltd. at Small Heath and Wolverhampton. It has not been a commercially viable organisation so far. Taxpayers' money on a very generous scale has been given to that co-operative—taxpayers' money taken out of the pockets of other successful enterprises. It was launched with what was said to be a once-and-for-all grant of £750,000 and a loan of £4·05 million. It lost £1 million in its first
  766
  year of operation. By October 1975 it had to have another Government loan of £150,000. By March 1977 it was on the rocks again and laid off 600 of its employees because it had failed to make itself competitive. GEC, under the aegis of Sir Arnold Weinstock, then stepped in with an offer of £1 million and the Government were obliged to give it a further grant of £500,000 and to defer interest payments on public money loaned to it worth over £1 million.
  That was the last rescue which occurred about a year ago. I do not know whether the Minister will confirm it this evening, but my understanding is that Meriden is fishing around again for yet more public money which it wants granted under the Industry Act. We wait to hear whether the Government will give it yet more money and whether the Industrial Development Advisory Board will again advise against it.
  It still seems to us to be making very little progress. I understand that Lord Stokes and Sir Arnold Weinstock have withdrawn from their management roles. The management in the United States have been replaced and the co-operative is still in trouble. That was a co-operative which was backed for purely political reasons. It has put other men out of jobs and is constantly draining public money because the Government are committed to it.
  Kirkby has been mentioned by the Minister, and that is the other best example of how this Government have promoted worker co-operation during their period of office. That is a company which engages in a diverse range of products, again created after industrial dispute and a sit-in. Its activities are heavily subsidised. I quoted radiators. In my opinion this has led directly to the bankruptcy of another company—Penrad in Swansea—which was being supported by public money by the Welsh Office in competition with the greater resources which the Department of Industry was pouring into Kirkby. Kirkby was launched in January 1975 with a public grant of £3·9 million of taxpayers' money. It lost £1·5 million in its first year of trading. Last year it was back again. The advice has always been that Kirkby is not a viable operation. Yet it had another £860,000 of Government money, and that was paid

  767
  despite the fact that the independent Industrial Development Advisory Board advised the Government that the firm was outside the Government's guidelines in seeking further financial assistance.
  At present Kirkby losses have been declared for 1976–77 as only £381,249. In fact, it is receiving temporary employment subsidy. No one knows how much, but it is my firm belief that the firm is losing, more than £1 million a year. It is in trouble again, and if it is to continue it will no doubt need a lot more Government money.
  In fact, the firm has announced at long last that it will discontinue its soft drink manufacture and its storage radiator manufacture. At long last it is accepting the advice that has always been given by consultants that these operations had no sound commercial basis at all. Because it is a worker co-operative and because some hon. Members are firmly committed to it and the Socialist movement is behind it, it hasc had huge sums of public money to maintain a small number of jobs in Kirkby, to destroy jobs in successful operations elsewhere and to keep it in business.
  The Labour Party has not changed its mind at all about the promotion of worker co-operatives. If my own Member of Parliament, the hon. Member for Birmingham, Selly Oak (Mr. Litterik), comes back into the Chamber and catches your eye, Mr. Deputy Speaker, I have no doubt that he will join with his hon. Friends in trying to strengthen this Bill to pour more millions of pounds into worker co-operatives wherever the next sit-in is organised by a fringe group of the trade union movement.
  Mr. Ioan Evans: I wonder whether the hon. Member would explain why this Government and previous Governments have given thousands of millions of pounds of aid to private enterprise? He refers to the fact that this firm is getting temporary employment subsidy. Hundreds of private enterprise firms are getting it also. Why is he discriminating against these two firms, which are failed private enterprise firms and which the workers have tried to take over in order to save their jobs? The
  768
  only thing that this Bill is doing is giving aid to workers' co-operatives, when Governments have given thousands of millions to private enterprise in the past.
  Mr. Clarke: I am disappointed in the hon. Member. He and I often agree in our criticism of the Government for giving aid to a wide range of private enterprise activities. However, we shall not go into the scale on which the Government at present spend the taxpayers' money. I know the hon. Member disapproves of it.
  There is one distinction that one can draw between these two firms and the others. The Government's own guidelines for the basis upon which it gives financial assistance insist that there must be some prospect of commercial viability before giving the aid. For that purpose there is the independent Industrial Development Advisory Board, which advises the Government on the prospect of success and the commercial wisdom of investments proposed. The Government are not bound to accept the advice, but they usually do.
  In the case of private enterprise companies, ordinarily organised, the Government have accepted the advice in every case for some years now. If the advice has been against the company, the money has not been forthcoming. Only in the cases of Meriden and of Kirkby the advice of IDAB has been overruled every time that those two firms had come back for more money. IDAB has always advised that they are not commercially viable because they are being organised in ways that are doomed to produce a situation in which each year the jobs involved are supported by money taken from the pockets of the taxpayers in other jobs elsewhere. It is this discrimination in favour of worker co-operatives that we disapprove of.
  I have a paper called "Building Britain's Future" which is described as "Labour's Policy on Construction" and which was printed by the Labour Party in October 1977. It is designed to show that the Labour movement and the Government have not changed their minds on the purpose of promoting worker co-operatives preferentially, and subsidised vis-a-vis their competitors. The document sets out the outrageous policy of nationalising large parts of the construction industry to

  769
  which the Labour Government are committed. One paragraph, headed "Workers' co-operatives" says:
  "Among the locally based firms, we believe the best way of extending social ownership is through the encouragement of workers' co-operatives. The Government now has powers, under the Industrial Common Ownership Act, to provide financial assistance to co-ops. We believe that this assistance should be increased, and new powers taken as necessary, and we remain committed also to the establishment of a Co-operative Development Agency. Trade unionists in the industry could perhaps themselves take the initiative in establishing co-operatives, and public bodies could actively assist by favouring co-ops in allocating work."
  That is the policy of the Labour movement. It is most objectionable because it takes the view that if one organises on co-operative lines, one should have access to taxpayers' money and be given financial assistance to which other small enterprises, employing perhaps similar numbers of people, will not have access. It provides that public bodies in allocating work should actively favour co-operatives. It involves the spending of public money to buy more goods and materials than would otherwise happen in order to buy the less competitive product or service offered by the co-operatives.
  That has been the approach of this Government. Kirkby has been kept in business in part by Labour local authorities buying radiators and not looking competitively through the market. At long last they have had to give up the radiators because it is costing so much.
  I ask the Minister to comment on this document issued in October 1977 and entitled "Labour's Policy on Construction". Is it the Government's attitude towards workers' co-operatives not to follow the desirable and anodyne aims set out in the Bill but ultimately to try to pave the way, if ever they get a majority, towards a situation where the taxpayer subsidises co-operatives and where public bodies that are run by Socialists favour co-operatives vis-à-vis private competitors?
  Mr. Litterick: I regret that I was absent for a few minutes during the hon. Gentleman's speech. He has expressed himself strongly and in uncompromising terms about what he calls taxpayers' subsidies or taxpayers' money being used to subsidise enterprises of this sort. But he must be aware that taxpayers' money is
  770
  being used currently to the tune of around £3,000 million a year to subsidise private enterprise—or at least what the hon. Gentleman would call "private enterprise". Since he has not qualified his attitude on public subsidies to commercial enterprises, is he saying that that £3,000 million should be withdrawn? Does he understand what the consequences would be?
  Mr. Clarke: The hon. Gentleman has been present for most of the debate, but he was out for a few moments when that same point was put to me by one of his hon. Friends. I then gave my answer. Perhaps later I shall write a letter to my Member of Parliament giving my view on the subject.
  I have described the clear difference between our approaches. The Bill, to the disappointment of the Minister and most of his colleagues, does not seek to confer on the Government powers to pursue their real policy towards co-operatives. We condemn and denounce the approach which I have described. We certainly are opposed to the idea that co-operatives should mean the spending of public resources, seizure of property by workers, or any active steps towards Socialism.
  Mr. Cryer: The hon. Gentleman made a serious allegation that KME, a co-operative employing about 800 people who depend for their livelihood on the operation of that co-operative, had ceased to make radiators. Is he aware that at the heating and ventilation exhibition in Birmingham held this week that co-operative has a stand and is selling radiators? It is making and selling radiators. Does he acknowledge that by making foolhardy remarks of the sort he has he could prejudice the financial position of that co-operative which is endeavouring to sell its products? Does he not wish to withdraw that statement in view of the possible damage it might do?
  Mr. Clarke: I would not wish to do anything to damage its genuine commercial activity. I am relying on reports to the effect that the 700 present employees are to be reduced to 600 because the co-operative has at last accepted advice that it must discontinue the manufacture of soft drinks and storage radiators. It may still be selling radiators and perhaps I am misinformed. I am sorry

  771
  if that is the case, but, if it is still manufacturing them, it is producing them subsidised by the public. If public subsidies are discounted, it is probably losing more than £1 million. It is selling radiators at a subsidised price in a market that has great over-capacity. There is more capacity in the manufacture of radiators than the market can absorb.
  The Kirkby co-operative is being subsidised in such a way that it keeps a market share that it would not otherwise win and it is putting people out of work elsewhere. Competitors cannot hold their own against this weight of public money and are having to discontinue production. Even a company receiving public subsidy—from a weaker Department—had to go to the wall because it could not compete with the vast sums of money being poured into Kirkby. We strongly reject that, but we suspect that if the Government could get their way they would like to pursue that sort of approach.
  Co-operatives can mean genuine workers' ownership, a direct interest in the job for the worker and a reduction of conflict between the interests of the worker and the enterprise. We see them as a valuable form of free enterprise and a healthy sector that could be encouraged to work within a market economy. We hope that the Agency will promote that idea and we wish it well in seeking to do so.
  9.21 p.m.
  Mr. Sydney Irving: For a number of hon. Members in the Chamber, this is a very important moment because it is the culmination of 10 years' effort by the co-operative movement and the co-operative parliamentary group, of which I am chairman, to get recognition for the idea of a Co-operative Development Agency and to secure a Government Bill.
  I therefore congratulate the Government on the introduction of the Bill and pay special tribute to my right hon. Friend the Prime Minister, without whose interest and support the Bill would not have been introduced this Session. It was his speedy acceptance of the majority report in October which opened the way for the possibility of getting the Bill this Session. I should also like to thank my
  772
  right hon. Friend the Member for Swansea, West (Mr. Williams), the Minister of State, Department of Industry, for his generous assistance from before the inception of the working party up to now. We are very grateful for that help.
  The co-operative movement, with its tradition of voluntarism and self-help, has long believed that co-operation is a form of social ownership in its own right relevant to the needs of ordinary people in their daily lives. It meets many of the requirements of the modern world. It encourages participation, stimulates individual effort and insists on democratic control. Standing between nationalisation on the one hand and private enterprise on the other, it is certainly not a second-class substitute for either, and, because of the voluntary spirit upon which it relies, it grows from the grass roots and cannot be imposed from above.
  As my hon. Friend the Minister said, the movement has largely been identified in this country with the retail movement. The British movement is the largest in the world, but we believe that its principles are of universal application and there are a number of examples in this country outside the retail movement where the principles are being effectively applied. There are co-operatives in industry, in the service industries, in fishing, housing, credit and depositing, and in my constituency there is an estate of 300 houses managed by tenants who look after their own affairs.
  Co-operation is about to enter an active period of development. An interest in co-operation has grown remarkably in recent years, and there has been a need for an agency to co-ordinate and encourage the development of co-operatives. The new Agency will be advisory and promotional and will have an important role in education and research. It will be a focus for the views and attitudes of the movement, but it will be independent and able to carry out its own policies.
  In encouraging a vigorous co-operative sector, the Agency will have no funds of its own, but that is not to say that there are not substantial funds available to co-operatives already. This applies in housing through the Housing Corporation, in agriculture and fisheries

  773
  through the Department, and in industry through the Industry Acts.
  It will be the duty of the Agency to embody the necessary experience and expertise to be able to advise both on the principles and practice of co-operation and on the ways in which co-operatives can secure aid to fulfil the objectives that they set themselves. It will be by the expert status of the Agency that it will be enabled to advise Governments on the social and economic viability of co-operatives seeking assistance.
  Social and economic viability will be an important requirement. The Agency will wish to help any group that genuinely wants to form a co-operative, but it will not wish to be the repository or refuge of uneconomic ventures that are the failures of the private enterprise system, although it will undoubtedly assist those who have the determination to practise the principles of co-operation and to become viable.
  The CDA is not a new priniciple. The Central Council for Agriculture and Horticulture, the Co-operative Housing Agency and the arrangements under the Industrial Common Ownership Act are all examples of assistance given by Goverenment to help co-operatives. In other words, they are mini CDAs.
  The success of the Agency will depend very much on the chairman and the members of the Agency. The chairman needs to be someone of great ability and with great experience in the movement to be able to command the confidence both of the House and of the movement. We are grateful to my hon. Friend the Under-Secretary of State, who has undertaken to consult widely before a decision is taken.
  I have undertaken to speak briefly because many of my hon. Friends wish to speak. Finally, I once again welcome the Bill. I wish it well and hope that it will have a speedy passage through the House.
  9.28 p.m.
  Mr. J. Grimond: I am glad to take up the remarks of the right hon. Member for Dartford (Mr. Irving) as I find myself in agreement with practically everything he said.
  The House should give the Bill a fair wind. It will have to be examined in Committee, and at that stage there are
  774
  certain points that will have to be made. The only serious reservation that I have is about the setting up of another board or agency. We have so many already that to increase the Government's power of patronage, or even the expenditure of public money on yet another one, fills me with concern. However, the Minister has assured us that the expenditure of money—this is what he hopes—will not be necessary after three years. I believe that he is right. I do not see why the Agency should not thereafter finance itself from fees or contributions.
  After three years, or whatever the period may be, let us consider the necessity of the Agency again. If it is necessary, it may be necessary in a rather different form. However, it may be as well to remove it from Government control altogether.
  I, too, believe that co-operatives can enable the country to meet many of its difficulties. To the list of industries and occupations that the Minister has mentioned which run co-operatives of various sorts I add the inshore fishing industry, which has a long tradition of common ownership of fishing boats. In this country we have not only the largest retail co-operative movement in the world but many interesting experiments in producer co-operatives. However, there is a great difference between consumer co-operatives and producer co-operatives. I am not certain that the Bill makes that difference. Both forms of co-operatives are valuable, but they are different.
  The kind of producer co-operatives that I hope we shall encourage are those which are wholly owned and largely financed by their members. They should not merely be operated on a form of profit-sharing. They should not, to my mind, be businesses in which those who run them are appointed by organisations outside, even though they may be workers' organisations. But they should be businesses which the workers generally control, to which they appoint the management and for which they raise or provide most of the capital.
  I have visited the Mondragon co-operatives. In addition to what has already been said about them, I should like to point to certain other features. First, they have managed to mobilise local

  775
  patriotism. In this country there is considerable interest, not only in Scotland and Wales but in the North of England and in other parts of England, in various forms of local patriotism. It is remarkable that in the province of Biscaya the Mondragon co-operatives have managed to play on local patriotism and have raised large sums of money from local people. They have also generated enthusiasm among people to make their home areas as good as they can be.
  Secondly, they are highly sophisticated in their technology. There is no question of their being some form of low, peasant-like activity. On the contrary, their research department is one of the best in Western Europe. Thirdly, the bank is central to the whole operation. It not only supplies the finance and a great deal of management expertise but vets any new candidates to the co-operative movement.
  Lastly, but most important, there are groups of co-operatives. There are about 60. They are being founded at the rate of about four a year. As has been said, that is happening in some parts of this country, though on a much smaller scale. It seems highly desirable that co-operatives should be in groups so that there is a wider spread of activities. If one co-operative has to lay off labour, according to the Mondragon principle employment to that labour should be offered elsewhere so that people who may be laid off during a depression have another chance of employment.
  There are valuable lessons to be learnt. I am glad that the Bill does not deal with investment in co-operatives. As has been said, they should have ordinary access to various forms of raising money which are available to all firms in this country. I am surprised that £900,000 for three years should be required to run the Agency. That is a generous allocation.
  I should like to think that what we are doing in the Bill might be linked to another Bill which is now going through the House—the Trustee Savings Banks Bill. I strongly believe that savings banks take money out of production in their local districts. I should like the savings banks to invest in their local areas where they raise their money. I should like them to invest in particular in co-operative enterprises of the kind that the
  776
  Bill will promote. I hope, therefore, that the two Bills might at some point be linked together.
  Like other hon. Members, I wish to be brief. Those are all the points that I want to make on Second Reading. However, I finish by apologising to the House for the fact that I may have to leave before the end of the debate. My constituency is a long way off and I must be there tomorrow. The night is drawing on, but I have an hour or two yet. I hope that the Minister and the House will forgive me if I have to leave before the final speeches.
  9.33 p.m.
  Mr. Ioan Evans: I am sure that we understand why the right hon. Member for Orkney and Shetland (Mr. Grimond) has to leave the debate. I think that in the discussions that have been taking place on North Sea oil the people of the Shetlands have been dear to the hearts of all hon. Members on both sides of the House. I am pleased that the right hon. Gentleman welcomed the Bill.
  As my right hon. Friend the Member for Dartford (Mr. Irving) said, Labour Members connected with the co-operative movement are delighted that we are having the Second Reading of the Bill. A great deal of credit must be given to Ministers in the Department. They recognised that this was a commitment in our manifesto and they have found time to bring the Bill before the House this Session. Some of us have been calling for this legislation for a very long time. Indeed, since the Government came into power in 1974 many of us have pressed them time and again to bring the Bill before the House.
  I have one small regret. We have had a busy Session. The National Enterprise Board and the Scottish and Welsh Development Agency measures are now on the statute book. I believe that the work of the Co-operative Development Agency will be complementary to the work done by the NEB and the Scottish and Welsh Development Agencies, and one would have hoped that provision for this body, too, would have been on the statute book by now. However, we realise that plans for the Co-operative Development Agency had to be formulated and that the working party therefore had to be set up.

  777
  As soon as the working party's report was published, as my right hon. Friend the Member for Dartford said, the Prime Minister announced the Government's support for the majority report. Speaking at the Co-operative Party's sixtieth anniversary rally at Central Hall, Westminster, he said:
  "It is our strong view that successfully organised and conducted producer co-operatives and common ownership enterprises offer a solution to the problem of encouraging all those who work in an enterprise in a pursuit of ends which should be complementary and which too often seem to be opposed … We take the view that co-operation has a role to play on a wider and a more active basis than previously … I undertake on behalf of the Government that as soon as we can get legislative time available we shall introduce legislation to set up a Co-operative Development Agency."
  That was a firm commitment by the Prime Minister, and I think that some of us were disappointed when we read the Queen's Speech and found that the Co-operative Development Agency was not in the Government's programme. Some of us were disappointed that we had been presented with another Queen's Speech containing no mention of the CDA. Therefore, it is all the more pleasing that in this Session, although there was no mention of it in the Queen's Speech, we now have the Bill before us for its Second Reading. I hope that it will be given a speedy passage through Committee—it is only an eight-clause measure—so that it can come back to the Floor of the House in a short time and soon thereafter become an Act of Parliament.
  I want to refer briefly to Clause 2, which deals with the functions of the Co-operative Development Agency. The clause talks about promoting the principles and representing the interests of the co-operative movement. Much has been done to promote private enterprise and to encourage nationalised industries. Why, therefore, should we not have an agency that will promote co-operative organisations? I take up the point made by the hon. Member for Rushcliffe (Mr. Clarke). Time and again, private enterprise has come along with its begging bowl to various Government Departments to ask for financial help. It was the Conservative Party which introduced the Industry Act to give financial assistance to private enterprise. As one of my hon. Friends said, about £3,000 million is provided
  778
  every year to bolster failing private enterprises.
  We now have a situation where, in certain cases, groups of workers are thrown out of work. On previous occasions I have given the House an example of a firm in my constituency which was taken over. The firm had good management, good workers, good industrial relations and a good order book, but, merely because it was taken over by a subsidiary of Slater-Walker, and because a private firm collapsed, those workers went to work one day and found a notice on the door saying "You are no longer in employment because the company is in the hands of a receiver and is going into liquidation." That was nothing to do with the product, and it was nothing to do with the management or workers. It was a failure of private capitalism.
  The workers met and said that they would like to form a workers' co-operative. The management came with them. They drew up a scheme and approached me as their Member of Parliament. Unfortunately, there was no one to whom they could turn to give them the necessary help to form a workers' co-operative. I believe that the Agency will give such workers that assistance in future.
  The second purpose is
  "to identify and recommend ways in which the establishment and development of co-operatives might be facilitated".
  As my hon. Friend the Minister said, the co-operative movement was started in this country. It was started by Robert Owen, a Welshman. Like all good Welshmen, he was an internationalist. He did not stay in Wales to form his co-operative but went up to Scotland to try to form a co-operative community in New Lanark. He even went further afield. He went across the seas to America, to form a co-operative community in New Harmony.
  Robert Owen was not only one of the original co-operators but was an original Socialist. In fact, it was in an Owenite magazine that the word "Socialist" was first used. He was also an original founder of the trade union movement. We in this country owe Robert Owen a great deal. He led to the group that met in Rochdale and formed the retail co-operative movement in this country, which now numbers 10½ million people.

  779
  I shall not dwell on the development of the co-operative movement, because I am very pleased that my hon. Friend the Minister gave his historical analysis. But we must bear in mind that here we were talking about a retail co-operative movement, whereas we now find throughout the world that co-operation is taking other forms.
  The third purpose is
  "to identify and recommend projects which might usefully be undertaken on a co-operative basis".
  As I have said, in this country we have tended to develop the retail co-operative movement, which is a strong force. But there is great scope for the extension of workers' co-operatives, with which I believe the Agency will be primarily concerned. I hope that it will work with those other bodies connected with the co-operative movement and that there will be the development of agricultural co-operatives.
  In Scandinavia, particularly in Denmark, there is a greater development of agricultural co-operatives than we have had in this country. We need to have similar growth here. There are also housing co-operatives, and in America there are even student co-operatives. The idea of co-operation, which we have worked so well on the consumer side in this country, can be extended into other fields. We should seek to develop this type of co-operative activity.
  The hon. Member for Rushcliffe tried to speak of the development of co-operatives as if they were a form of private enterprise, but they are a form of common ownership. The co-operative movement is a do-it-yourself form of Socialism. We can have Socialist action by Act of Parliament, by taking action on a national basis. We had an act of Socialism by the Conservative Party when it took Rolls-Royce into public ownership. It was a form of nationalisation. But we can have Socialism in other ways.
  We see that another function is
  "to appraise and evaluate projects which are to be undertaken on such a basis".
  Here I agree with what the working party said, that we should not think only in terms of failures of private enterprise but that we need to make a proper appraisal and evaluation, to have the expert assistance to move into new fields and to develop co-operatives.
  780
  I know that many hon. Members want to take part in the debate, and I know, Mr. Speaker, that you now have a rule about speeches taking eight minutes, and I hope that I have not exceeded that.
  Mr. Speaker: The hon. Gentleman is comfortably over that.
  Mr. Evans: I am glad, Mr. Speaker, that I am comfortably over it and not uncomfortably.
  May I say, without going through the other parts of the clause, that I welcome the Bill. Last week I was at an Inter-Parliamentary Union meeting in Lisbon. Parliamentarians from all parts of the world were present, and they were saying that many of them had gained their democratic experience through their association with the co-operative movements in their countries.
  It was here in Britain that the co-operative movement was founded. I am glad that at long last this Government have seen the wisdom of bringing into being a Co-operative Development Agency, which will see that in this country we have not only a strong retail consumers' movement but a strong co-operative movement in all the various other sectors, and particularly in the working sector. I believe that the co-operative movement has a large part to play in dealing with unemployment as it affects small firms.
  9.45 p.m.
  Mr. Laurie Pavitt: The last time that I spoke on the Co-operative Development Agency, I lectured to the Co-operative College. On that occasion I took one hour, and I took one and a half hours over questions and discussion. Tonight, I undertake to take only eight minutes. For that reason, I hope that my hon. Friends will forgive me if I do not take up some of the points they have made, although I am tempted to do so.
  Tonight I wish to commend the Bill on its general principles. There are nine positive parts to the clauses which give the body to the Bill and there are four exclusions. Most of these matters will be major items of debate in Committee.
  I should like to commiserate with my hon. Friend the Member for Edmonton (Mr. Graham), who sits on the Front Bench as a Whip, because no man has done more for the Co-operative Agency

  781
  than he. Because he is a Whip, he is excluded from the debate. I pay tribute to him for his work which led to the Bill.
  As my right hon. Friend the Member for Dartford (Mr. Irving) said, the Bill is long overdue. It has had a gestation period of 10 years. However, perhaps one of the advantages is that it is being born in a climate in which it can bear good fruit. The basic point for this type of concept in economic and social relations exists in the fact that increased mechanism and large-scale production has led to boredom and materialism which should have made for a full life and enriched personalities. Instead, it has led to disappointment and hopes which have been left unrealised. The media sometimes increase this feeling of disappointment in advertising false dreams.
  The crying need in the 1970s and 1980s is for participation and involvement. The Agency is a small step which will enable that desire to be realised by the encouragement of co-operative enterprises.
  Hon. Members have drawn attention to co-operatives overseas. I was pleased that the right hon. Member for Orkney and Shetland (Mr. Grimond) led the delegation to Mondragon. I wish that he had looked at the same time at Catalonia, where he would have seen similar things. I go back even further. It is interesting that this legislation is similar to that introduced by the imperialist British Raj in India in 1906. At that time India had almost the same problem. There was a passive peasantry. There was a need to activate people to run their own affairs rather than look for some fate or destiny so to do. As a result of that, in India today there are 60 different forms of co-operative society. However, only rarely does one see the form of co-operative which is so familiar in our own country—the consumers' co-operative movement. I doubt whether the Agency, in the various forms that it will assist, can help the growth of toddy tappers societies, stag bull societies or tube well societies and many others that I have seen in Asia. But to one type which is widespread in developing countries will give stimulus, namely, credit unions.
  Against the background of the economic crises that we have experienced in the last four or five years, it might
  782
  redress the balance because we have been preoccupied with production. More and more do we need to balance production with good services. I can see great scope for the Agency in giving extra advice and opinion and educational facilities for co-operatives in sub-contracting and specialist firms for building construction. One of the big problems that every hon. Member has experienced is to know whether the repair of his car has been well done. Why not have co-operatives involving repairs to cars, electrical services, plumbing services, domestic machinery and rural services to provide mutually those services which are no longer profitable enough for capitalist enterprise?
  There is special scope for the "small is beautiful" concept. In inner urban areas in particular there is a great need. This approach should seek to rehabilitate areas such as mine, where there are 66 firms which have failed under capitalist enterprise in the last seven years. Most of these matters will be dealt with in Committee, and I should advise my hon. Friend the Under-Secretary that I have in mind one or two amendments affecting the inner cities.
  There has been controversy over the minority report. I agree with most of the philosophy of that report which wants a fraternal rather than a paternal approach. Nevertheless, the Government have been right to go ahead on the basis of the majority report. If they had not done so, there would have been the feeling which was expressed by my old friend the late Hugh Gaitskell when he accused the co-operative movement in 1958 of wanting to "defer, defer and defer" rather than reach a practical decision.
  The Bill offers a constitution which is practical and workable. It is modest and it will make a modest start, but it is not as modest as the Rochdale Pioneers, a group of working men from the Lancashire mills who on 21st December 1844 got together after work and were able to count 5s. 4½d. in the till as a result of the sale of candles and sugar. A rich flowering of new co-operatives can usher in social and economic changes that will be as significant in the next century, as the Rochdale development was in the last century. From those appointed, I believe that we must look to practical work which

  783
  will be adventurous and imaginative with vision of the future that could make the Bill one of the most important, small though it may be, of this Parliament.
  9.52 p.m.
  Mr. Stanley Newens: I wish to welcome the Bill. As president of the London Co-operative Society and a member of the central executive of the Cooperative Union, I ought to declare an interest, but I assure the House that that interest is based on a passionate conviction of the validity of co-operative ideals and their relevance in the present economic climate.
  In Britain we are more familiar with the retail-oriented consumer-owned societies, and with the CWS, which are deeply established in distribution. It is important to remember, however, that the co-operative pioneers were equally concerned with co-operative production. According to evidence given to the Royal Commission on Labour in October 1892, there were at that time 150 co-operative productive societies with more than 25,000 members and with sales in the previous year 1891 of £2½ million.
  At different times there were co-operative corn mills, cotton factories, woollen mills, boot and shoe factories, iron foundries, collieries, print works and publishing houses, and different societies produced a wide range of products. The birth of workers' co-operatives in recent years, therefore, is not a new phenomenon but a revival of a trend which was well established a century ago. Today, however, it is much more difficult to initiate a private venture or any industrial venture in the current economic climate. It is, in particular, more difficult to launch a co-operative enterprise. Therefore, although the co-operative movement was established on the principles of self help, of which its members are intensely proud, to launch co-operatives today requires help of the sort that only the Co-operative Development Agency could hope effectively to provide. There should be no shame on the part of any co-operative in seeking assistance from the State.
  It ill becomes the hon. Member for Rushcliffe (Mr. Clarke) to attack Government assistance to industry. The Agency will be a most modest and inexpensive
  784
  proposal, particularly bearing in mind that far more money is spent every day to support private industry than the Agency will cost over the full three-year period specified in the Bill. My comments are not in any way intended as criticism of putting large amounts of State money into private enterprises, although it might be much better if some of those enterprises were taken into full public ownership. My comments are designed to put the CDA into perspective.
  Co-operative enterprises do not depend upon one entrepreneur. The workers are not left to vegetate until someone comes along prepared to launch a firm that will employ them. The workers can, in fact, do it for themselves and establish a co-operative enterprise. But if the workers are to do this they need assistance of the type which can be offered in present circumstances only by the Co-operative Development Agency.
  I myself, in various capacities, have been approached on various occasions by workers who were anxious to establish co-operatives, and it became only too clear to me, over past years, that they would be able to get the sort of advice that they required only if an agency of the sort proposed in the Bill were set up.
  Much as I welcome the proposals, I still believe, however, that the real problem in establishing any enterprise is not merely to be met by advice, much as I welcome it. In the last analysis, it is possible to establish a viable enterprise only if one has access to the capital that is necessary to be invested.
  I am aware of the many possible sources of funds that the Co-operative Development Agency may be able to advise would-be co-operators to tap. There are those available from the National Enterprise Board. There is the EEC Regional Development Fund. There is job creation money. There are many other sources. But, in the long run, I believe that there is no substitute for an agency which could, in fact, provide financial help in setting up co-operative enterprises from its own resources, and eventually I believe that such an agency, endowed with the necessary funds, is necessary and must, in fact, come.
  I hope that the proposals embodied in the Bill will be the first step in that direction. I hope, furthermore, that the Agency

  785
  will inject a sense of urgency and dynamic into the drive to set up co-operatives, the sort of spirit that will help to convince many people in the community at large of the necessity of travelling further along the road upon which we have embarked and are embarking upon more deeply this evening.
  I believe that in this day and age, when workers are so much better educated and less oppressed, job satisfaction and motivation are vital. Co-operation can provide a structure in which the need for that motivation can be met. Co-operative enterprises ought to be accepted as a valid and most important form of industrial democracy. It is true that co-operation is not suitable for the largest enterprises, but in many others it is a far more suitable form of industrial democracy than codetermination or that proposed in Bullock.
  Therefore, I hope that the Bill will help to stimulate the growth of co-operatives in Britain, in production, in distribution and in many other fields as well. In the nineteenth century co-operatives were recognised by eminent men across the political spectrum for their worth, and I believe that they should be so recognised today. But, in the long run, I believe that co-operatives have a vital role to play, not only in a mixed economy which is essentially capitalist, such as that in which we live today, but also in a Socialist society which I believe that we should be seeking to create.
  I therefore take great pleasure in welcoming the Bill and I hope that it will speedily be put on the statute book.
  9.59 p.m.
  Mr. Ivor Clemitson: I, too, welcome the Bill. However, I must say that I welcome it rather on the basis of one slice being better than no bread. I have two criticisms and one comment to make.
  The first criticism is as to the method of selection and the constitution of the Agency. We have here yet another body appointed by a Secretary of State. Of course it is easy to do it that way. It has always been done that way, so it follows precedent, but that does not make it necessarily right or desirable. We
  786
  have more and more appointed bodies, more and more patronage seeping further into the fabric of our society. Surely—
  It being Ten o'clock, the debate stood adjourned.
  Ordered,
  That, at this day's sitting, the motion relating to the Co-operative Development Agency Bill may be proceeded with, though opposed, until any hour.—[Mr. Graham.]
  Question again proposed, That the Bill be now read a Second time.
  Mr. Clemitson: Surely there are other ways. Surely we do not have to follow precedent slavishly. If ever there was a time to try something new, it was in the setting up of an agency like this. Surely it is in the very nature of co-operation to be concerned with democracy, not patronage. People will talk reasonably and rightly about the difficulties—for example, of balancing the giant retail concerns with the relative pygmies of the producer co-operatives and common ownership schemes. But I believe that the minority were right to stick out against the patronage concept. I supported them and encouraged them to do so. They were conciliatory and came up with a compromise. I hope that in Committee the position of the Agency will be reconsidered.
  My second criticism is this. The Explanatory Memorandum says that the Bill
  "… gives effect to the majority report of the Working Group on a Co-operative Development Agency".
  That sounds fine, but the terms of reference of that group were very restrictive. The Agency was to be, and under the Bill will be, purely consultative and advisory. That is not unimportant, and I welcome the Agency being set up, but it is an emasculated version of what some of us originally hoped.
  Every day, millions of pounds are disbursed to private industry. If only a fraction of that money could be devoted to the development of co-operatives it would have a dramatic effect. Imagine if producers' co-operatives had a share of

  787
  manufacturing output similar, for example, to the share that retail co-operatives have of retail turnover. The situation would be very different.
  I know that the problems are not related only to availability of capital—there are problems of managerial and professional expertise, too—but we should think big about co-operatives. They should become a large and significant sector of our economy. That will not happen unless we are prepared to devote resources, thinking and energies to that end. Of course we do not want lame ducks, but co-operatives are qualitatively different from private enterprise. I hope that the Agency in this form will be merely a first step down a long road and not an end in itself.
  My brief comment is that I believe that it is of the essence of co-operation that power should be diffused and not concentrated, that initiative and enterprise well up from below. It is essential that the Agency shall not become a centralised bureaucratic body.
  Some of us have tried to write into the Inner Urban Areas Bill a clause about local co-operative development agencies. I believe that we need that kind of local initiative. We should have not outposts of some central national body but local initiative coming up from below. Co-operation must be worked out at a local level. I urge on the Co-operative Development Agency that it should see itself very much as an enabler and encourager of local initiative, and not in any way as some kind of empire builder from the centre or from the top.
  All the speakers, at least from the Labour Benches, have spelt out the virtues of the co-operative idea and the co-operative form of organisation, and I have no need to repeat what they said. All I would say is that co-operation is a peculiarly appropriate way of avoiding the dangers of centralism and the concentration of State power, to which I think we are all opposed, at the same time as releasing the energies and talents of people and fully involving them in control over their own lives and their own livelihoods.
  The Bill is a very small start. We should regard it not as the end of the
  788
  matter but very much as part of the beginning.
  10.7 p.m.
  Mr. Jim Craigen: The idea of a Co-operative Development Agency has been the brainchild of the co-operative movement. However, the Agency as proposed in the Bill will not be the property of the co-operative movement, because it has a job to do, and a job for which it will be publicly accountable.
  Together with my colleagues in the co-operative parliamentary group, I welcome the introduction of the Bill. It is a small measure, certainly less ambitious than that which we foresaw in the early 1970s, but none the less it is one which will, I feel, make a useful contribution. It is one not wedded to the traditional retail co-operatives but is meant to open up new horizons in the development of co-operative enterprises.
  I have two general observations to make on the Bill. The first concerns the employment factor. We all hope that more employment opportunities will be made available as a result of co-operative enterprise. None the less, we have to see the co-operative sector in perspective. At the moment, it provides employment for a little less than 1 per cent. of the working community, as against 70 per cent. working in private industry or the 29 per cent. engaged in various forms of activity in the public sector.
  I hope that the Minister will assure us that co-operative enterprises applying for Government assistance under existing aid-to-industry schemes will be treated in the same way as any other firm or organisation seeking such assistance from the State. I have no doubt that the CDA will facilitate new employment opportunities, but it seems to me, bearing in mind the resources at the disposal of the Agency, that we shall depend a great deal on the skill with which the Agency operates as a body.
  I trust that there will be a Scottish presence for the Agency. Last summer the Scottish Co-operative Development Committee got off the ground, thanks to some assistance through the Industrial Common Ownership Act 1976, for which my hon. Friend the Member for Consett (Mr. Watkins) must take great credit.

  789
  I know that the Minister was very sympathetic to the work of the Scottish Cooperative Development Committee. I should like to think that this body, which has now appointed a development officer, will be able to provide some practical assistance and advice to prospective co-operative enterprises in Scotland and that it might well serve as the embryo for some CDA activities north of the Tweed.
  The second area I want to deal with relates to the management consultancy role of the CDA. Like my hon. Friend the Member for Luton, East (Mr. Clemitson), I do not want to see a settled bureaucracy. I want to see an active task force in the CDA, one that is able to offer what is so often lacking to people who are interesting in setting up a co-operative—professional, sympathetic advice on legal and financial matters, taxation questions, product viability and marketing skills and questions of personnel and training.
  Mention has been made about the personality of the chairman and the members of the Agency. I would not for one moment underestimate the importance of that. I would, however, stress the importance of the calibre and imagination of the person appointed as chief executive and the team that he gathers around him, in being able to deploy the various professional skills that I have mentioned.
  The Agency will be identifying, promoting and encouraging co-operatives. Frankly, I would have been happier had there been some reference to assistance with regard to risk capital. That represents a special problem for co-operatives. Very often, when prospective groups go to financial institutions, they are faced
  790
  with the problem of the mortgage and the fact that if the institution is to invest it may well look for an equity stake or, indeed, a seat on the board. These are obstacles which pose difficulties when one is dealing with a co-operative enterprise where one has the very basis of fixed share capital, non-transferable shares and fixed interest.
  I hope that the Government will look again at the possibility of introducing a scheme whereby the CDA can guarantee loans made by financial institutions to co-operatives or prospective co-operatives. I should like to see the Co-operative Bank become involved in this area.
  There are two small points that I wish to mention about the functions of the CDA, which, I think, are wide enough. However, I hope that the question of the CDA acting as a forum will not mean that we have merely a big talking shop. Secondly, in undertaking studies and research I hope that we shall not simply have the CDA used as a means of giving pocket money to sociologists to produce histories of co-operatives.
  The Bill provides a small wedge in opening up co-operative enterprise opportunities. I hope that it will open them up in away which will extent the concept of co-operatives beyond the traditional confines. An affirmative resolution is proposed in Clause 4(3). I would have preferred the Bill without that affirmative resolution, because I fear that the Agency in its first three years may become too preoccupied with what comes after 1981 and when the three-year funding period runs out.
  10.14 p.m.
  Mr. Geraint Howells: When I came into the Chamber about half-an-hour ago, I had no intention of speaking in this debate, because I am in favour of the Bill. I came in only to listen to my colleague, the right hon. Member for Orkney and Shetland (Mr. Grimond). I thought that he made a persuasive case for the Bill when supporting it on behalf of the Liberal Party. However, after listening to one or two hon. Members, I should like to clarify one or two matters.
  I was surprised to hear the hon. Member for Aberdare (Mr. Evans) speak of the "failure" of private enterprise. I live in a constituency where we are dependent on private enterprise. Perhaps he is not aware that 31 per cent. of the people in my constituency are self-employed and that small firms play a major role in Cardiganshire and many other parts of the country.
  We need a mixed economy. I believe in co-operation, and I believe in private enterprise. The hon. Member for Aberdare also said that agriculture should look at the co-operative movement in Sweden. Many of our counterparts in other countries, and perhaps even in Sweden, should look at Wales where we have a co-operative movement within agriculture. The Welsh Agricultural Organisation Society has done excellent work for 20 or 30 years and the majority of farmers buy their products through the co-operative movement.
  I make a plea to Labour Members who are in favour of the co-operative movement, which I, too, favour. We must look after private enterprise, too. It would be a sad day for Britain if private enterprise and small firms ceased to exist. Small firms are the backbone of our community life in rural areas.
  The agreement between the Government and the Liberal Party has done much good for small firms and has helped many to become viable once again. The pact has done a power of good for them.
  I ask the Minister one question. If we have a Welsh Assembly established in Cardiff, does he envisage that we shall have an Agency such as is proposed in the Bill being looked after by Welsh people in Wales?
  10.18 p.m.
  Mr. Tom Litterick: In rising to support this Bill enthusiastically I must admit that I experienced a chill when I realised that the Tory Party was supporting it, and an ever greater chill when I realised that it had Liberal support as well. That seemed enough to condemn the poor wee thing to death before it starts.
  I refer to the speech of the hon. Member for Cardigan (Mr. Howells). It seems a bit daft to say that one is in favour of the mixed economy. In fact that is about as daft as saying one is in favour of the weather. The hon. Member must be more specific. Does he mean the mixed economy that is the British economy now, or the mixed economy that was the British economy 50 years ago? Or does he mean the mixed economy of Belgium, or that of Yugoslavia, or that of East Germany, or even that of the Soviet Union or China? These are all mixed economies, but they are all very different animals. Perhaps at some other time we can have an interesting debate on what we mean by the term "mixed economy".
  This Bill is significant because it seeks to encourage a type of organisation that is a departure from the monolithic Morrisonian public corporation, and also a departure from the monolithic hierarchical private corporation. There are other kinds of business enterprises, but this is aiming at something that is small in scale and run on principles quite different from those dominating the two types of institution that I have just mentioned. They cannot, by their very nature, be dependent on authoritarian governmental systems within them.
  It is that aspect that causes much of the alienation on the part of masses of people within modern, highly developed economies. They find themselves in huge organisations with perpendicular, hierarchical authoritarian systems that tell them what to do, when and how, down to the last detail, regulating their lives to the last millisecond, so far as they can. Much of their trouble stem from the fact that flesh and blood human beings resist this kind of regimentation and regulation.

  793
  The Bill offers some hope that we can catalyse the development of a qualitatively different kind of organisation within which human beings can lead genuinely human working lives. That is a great advance on working for an organisation as anonymous as, say, ICI or even the gas board. Those organisations have not yet answered the enormous human and social problems posed by their very existence and size. They have not yet done so. It may be that we in the Labour Party offer them some sort of way out of their human impasse through an industrial democracy Act. But since we have seen neither hide nor hair of a White Paper on the subject and nothing approaching a Bill, there is no point in pursuing that subject now, but we might have something to offer them eventually when we can get round to passing such legislation.
  Many co-ops have been formed in the past and most have been destroyed. There are very few survivors. They come and they go like May flies, just as small businesses come and go like May flies. I suggest to those of my hon. Friends on the Labour Benches who have a special connection with co-ops—by which we mean the retail co-operative societies—that the only reason the retail co-ops in Britain have survived and flourished is partly the peculiar federal structure of the retail co-operative societies. It is partly because of the technological revolution which overtook the retail trade after the co-ops had been in business for many decades and were deeply embedded in British society, and because they bad the funds and managerial expertise to resist the stress caused by the technical revolution in retailing which happened as recently as the last 30 years.
  But other co-operatives were not so fortunate. It is the inevitable tendency of the development of capitalism and modern technology that organisations should grow bigger and bigger. That bigness confers enormous market power, for which Opposition Members seem to have great admiration. That in turn makes it an absolute certainty that small businesses cannot survive in those market conditions. They are market systems, but they are systems which become progressively more monopolistic and able to prevent the entry of new and possible
  794
  competitors. That is an unmistakable characteristic of our type of system.
  We must remember that the real purpose of the Bill is to encourage the development of a particular kind of small business. Opposition Members are for ever saying that small businesses should be given special consideration. What they mean is small businesses owned and controlled in a personal proprietorial sense. We are not talking of that kind of small business. This Bill refers to a special kind of small business.
  I hope that the Conservative Party, in giving such support as it has given to the Bill, will at least acknowledge that it is small businesses about which we are primarily talking. Intead of giving the Bill the tepid support which they have offered—support which has been heavily qualified—the Tories should offer enthusiastic support aiming at what for many could be a salvation from the totalitarian characteristics of the large organisations that dominate our economic system. Those organisations are essentially totalitarian and most human beings do not like to spend their working lives in such organisations because they are totalitarian.
  I agree with my hon. Friend the Member for Luton, East (Mr. Clemitson) that the method by which agency personnel will be appointed as described in the Bill should be only temporary. It is unfortunate that, willy-nilly, we are setting up yet another group that will be the subject of ministerial patronage. I understand that in the initial stages it may be necessary to rely on unilateral appointments by a Secretary of State, but I hope that within the three to five years specified in the Bill we can gradually move away from that. I hope that the Bill will be amended to indicate the possibility that appointments to the Agency will not indefinitely be within the sole bailiwick of the Secretary of State, because this can encourage a sort of authoritarianism and bureaucracy that would be unfortunate.
  Clause 3 will have to be closely scrutinised in Committee. The number of things that the Agency will not be allowed to do depressingly prefigures its long-term character. I hope that we shall be able constructively to discuss in Committee how the clause can be positively modified.

  795
  I hope that the fears expressed by the hon. Member for Rushcliffe (Mr. Clarke) about the future of the Agency will be fully justified. I hope that it will be endowed with financial strength to act autonomously as a financier of small co-operators when they are at their most vulnerable stage of getting off the ground, and I hope that the Agency will become a permanent economic institution in the fabric of our society.
  10.28 p.m.
  Mr. Arthur Palmer: I intend at this time of night to be extremely brief. Like every other hon. Member, at least on this side of the House, as an active political co-operator all my life, I welcome the Bill.
  If I were asked to define co-operation, I would say that it is Socialism without the State. The hon. Member for Rushcliffe (Mr. Clarke) seemed to regard it as an eccentric form of private enterprise, but that is a perverse sort of reasoning.
  Consumer and producer co-operation flourishes in strong free enterprise economies, including the United States, in the Communist economies of Eastern Europe, and in the mixed economies, which is a useful if vague way of describing the economic organisation that we now have in Western Europe, including Scandinavia, France and this country. Co-operation is a universal principle crossing frontiers and transcending ideology.
  It is interesting however, to note that, although British co-operation has had a very long life, having been founded early in the nineteenth century, our Governments in the twentieth century have tended to take a somewhat negative attitude towards co-operation. Indeed, some Governments of recent times have gone further and taken an almost punitive attitude to it, particularly as regards taxation. One of the outstanding advantages of this legislation is that it at last breaks the sterile tradition of negativism shown by British Governments towards co-operation.
  The Bill takes a positive and encouraging attitude towards co-operation in all its forms and, just as important, it will I think, preserve the cherished independence of the co-operative movement from the State, which has always been valued by British co-operators.
  10.30 p.m.
  Mr. Peter Bottomley: I take up one remark made by the hon. Member for Bristol, North-East (Mr. Palmer). To talk of co-operatives being Socialism without the State seems to be a rather curious way of describing the act of co-operation. I would describe it as an act of sharing without Socialism.
  Mr. Palmer: I suggest that a rose by any other name would smell as sweet.
  Mr. Bottomley: I turn to the remarks of the hon. Member for Birmingham, Selly Oak (Mr. Litterick). The hon. Gentleman seems to be popping in and out of the Chamber. I regret that he is not present to hear my remarks on his remarks. He did his best to distort, delude and possibly to entertain the House by suggesting that China, East Germany and the Soviet Union are not Socialist States. He described all three as having mixed economies. I suppose that it can be argued that if a farmer, or farm-worker, in Russia is allowed to spend 3 per cent. of his time working on 3 per cent. of the land producing half the agricultural production of that country, there is a mixed economy. However, that demonstrates that private enterprise works better than State Socialism, or even enforced collectivism.
  The hon. Member for Selly Oak has done a disservice to the cause of co-operation by claiming that co-operation is Socialism in practice when the hon. Gentleman and some of his colleagues spend most of their time trying to force a totally different sort of State Socialism—namely, collective, centralised nationalisation—on more industries rather than putting their principles into practice as expressed this evening, when they should be arguing that the present centralised State monopolies, the nationalised industries, should be returned both to those who work in them, giving them the freedom to dispose of their shares in them if they feel that to work as a worker co-operative is not the most efficient system.
  Mr. Newens: Is the hon. Gentleman not aware that many of us within the Labour Party have for years been advocates of what we have described as worker control, or industrial democracy, one of the objectives of which is precisely to democratise the State-owned monoliths?

  797
  We recognise many of the faults that are attached to those organisations. We do not want them to remain in their present form.
  Mr. Bottomley: I congratulate the hon. Gentleman on his ineffectiveness. For example, as regards the British Steel Corporation, we were told that having worker directors would be the answer. We are told 10 years afterwards that that has made no difference or very little difference. The hon. Gentleman must have made considerable efforts to persuade his party and the Government to implement worker control of the nationalisation of the shipbuilding and airframe industries. There has been no sign of that. I only wish that the hon. Gentleman's efforts to force other forms of Socialism down the throats of the country were as ineffective as his efforts have unfortunately been in tackling his party's desires, evidenced by its actions, to continue with a form of nationalisation, a form of worker control, which the hon. Gentleman and many of his colleagues have laughed out of court tonight. The trouble is that the rest of the country and those of us in this place are in court and suffering because of that.
  Mr. Mike Thomas: One could be forgiven for thinking that the hon. Gentleman was an ardent advocate of industrial democracy. No doubt he will tell us all about it and how much he is in favour of it.
  Mr. Bottomley: I am grateful to the hon. Gentleman. I was about to turn to the remarks of his hon. Friend the Under-Secretary of State and to inquire why the gratuitious insults involving Select Committees were introduced.
  Mr. Russell Kerr: Get on with it.
  Mr. Bottomley: Does the hon. Gentleman wish to intervene? If he does not, I shall be grateful if he will agree to keep quiet. The Under-Secretary of State has chosen to introduce notes of controversy where none exists. As the Bill is drafted, there are few areas of controversy. [HON. MEMBERS: "Then sit down".] I hope that Labour Members below the Gangway will contain themselves. This is no laughing matter. Those who work, or would like to work, in cooperatives would prefer to see Labour
  798
  Members paying rather more attention to other hon. Members. I did not sit in my place laughing at Labour Members' contributions, even though some of them were as laughable as the contribution of the hon. Member for Selly Oak.
  There is no reason to bring political controversy into a Bill that is politically non-controversial. Similarly, if a Select Committee produces a unanimous report, there is no need to take the view that political controversy must be introduced. Why should that be done when others happen to find common ground?
  I recognise that the Bill is built on the report of the working party. There is a part of the minority report that demonstrates the point that I am trying to make—namely, the need to keep Socialism out of co-operative enterprises. The minority report, in page 2, paragraph 2.3, states:
  "Membership of a co-operative society should be voluntary … without … political … discrimination, to all persons who … are willing to accept the responsibilities of membership."
  Drawing a quick parallel with trade unions, I think that many more people would be willing to join trade unions if membership were voluntary and there were not discrimination, the only test being whether people were willing to accept the responsibilities of membership. Too often we have seen enforced Socialism wreck ordinary, decent, useful voluntary bodies. I hope that future c-operative organisations do not feel that they have to follow the line put forward by some Labour Members: that Socialism must be tacked on as a useless or interfering appendage to every kind of organisation.
  I support the comments of the hon. Member for Cardigan (Mr. Howells) about the importance of private enterprise. I think that private enterprise within a co-operative framework is an important part of the spectrum of business organisation, and it ought to get a fair wind. I do not believe that that fair wind should be extended to giving the kind of subsidy which, on a continuing basis in a competitive industry, would force others out of business.
  I have had experience in a small engineering company of competing with other firms which have been heavily subsidised

  799
  for a number of years. I know how difficult it is for people in a competitive industry to compete with those who have a bottomless pit of funds available to them.
  Perhaps when the Minister replies to the debate he will give the sums per employee that have been sunk in some of the producer co-operatives that he mentioned. He may argue that these are of no relevance to the Bill, and I think that he would be right. In that case, I ask that his hon. Friends should desist from trying to turn the Co-operative Development Agency into a source of finance for non-competitve products. I believe that, if we are to have a spectrum of business organisation in this country, the financial rules should be basically the same for all so that the customer gets the best choice without having to subsidise uncompetitive products through the taxes that he pays.
  There is another point in the report to which I should like to draw the attention of the House. In pages 14 and 15, paragraph 50, talking among other things about the balance within the Co-operative Development Agency of large members of the movement, such as the retail co-operatives and the newer smaller producer co-operatives, the report states that
  "no matter what self-denying ordinance it might offer to observe, it would be unrealistic to suppose that there would not be occasions when it "—
  the large part of the movement—
  "would assert the power of the purse in ways which other sections of the Movement would dislike or even mistrust".
  I think that those are very wise words. They precisely describe what is happening in the Labour movement at the moment. All the constituency parties put together are outvoted and outgunned by trade unions which contain many members whose political objects have nothing to do with the kind of decisions forced on the Labour movement as a whole. Perhaps I am putting in a quiet wish that the Labour movement could be appointed by a non-Socialist Secretary of State so that we could get away from all the horrors of Socialism as we have seen them in the last few years.
  The next point that I want to make—I recognise that the hour is getting late—is the hope that co-operation and co-operative
  800
  enterprises will come not only from the private sector but from parts of the existing public sector. It seems that a number of functions carried out by local authorities and their employees could equally well be carried out by co-operative enterprises. I leave out public works, which deal with the construction industry, because that would introduce an unnecessarily controversial note. But parts of refuse collection, hospital laundries and other areas which are not fundamental to the main public service involved could be carried out more effectively and economically by co-operative enterprises as well as giving more satisfaction to the people employed. Alienation comes within not only large private firms, but, as the hon. Member for Selly Oak said, nationalised industries and public enterprises.
  Mr. Litterick: As the hon. Member for Selly Oak said.
  Mr. Bottomley: I am grateful to the hon. Gentleman for coming back and making that interjection. He has just repeated what I said. As the Minister has so wisely summed up the debate from a sedentary position, if I conclude my speech, he will be able to do so from an upright position.
  My last comment is about taxation. A number of difficulties arise in the transfer of the ownership of an enterprise from a proprietor, or a group of proprietors, to the employees involved. I am not suggesting that every proprietor should transfer his business to his employees. I recognise that a number would like to be able to do that. Unfortunately, some of the tax avoidance legislation, or anti-avoidance legislation, makes it difficult for someone who owns a fair amount of capital to give it to his employees, or allow it to be transferred to his employees, without a heavy tax penalty.
  Mr. Clemitson: Did I hear the hon. Gentleman say that if the owner of a business wished to transfer the ownership of that business to the employees, there was a heavy tax penalty? If that is what he said, it is untrue, because two sections of the Finance Act 1976 specifically provide for that eventuality and exempt the transfer from capital transfer tax and capital gains tax.
  Mr. Bottomley: My words described both the transfer and allowing employees

  801
  to earn the ownership of the business. My understanding is that it a proprietor wants to allow employees to take capital in the business at an accelerated rate, that is caught by some of the regulations of the Inland Revenue on share option schemes. I am talking not about the kind of share option schemes that ICI uses, but about the kind that might transfer the majority or the whole of the ownership of the business to the employees over a relatively short period.
  I believe that the CDA can wisely look at the impact of taxation on these arrangements as well as, I hope, looking forward to co-operative enterprises not just of common ownership where each worker in the enterprise owns the same share but going on to develop a range of co-operative organisations where people can move into one form of organisation and, if they desire, move out of it again, and not just establishing static co-operative organisations.
  10.43 p.m.
  Mr. Cryer: This has been a very interesting and, indeed, almost inspiring debate because of some of the remarks from this side of the House. It is significant that the debate has been dominated by Labour Members putting forward ideas and constructive suggestions for the Bill. I have no doubt that there are occasions when it is possible—just—that Government Members standing at the Dispatch Box find putting forward a point of view slightly dispiriting, but I am certain that tonight is not one of those occasions, and I am indeed fortunate to have been able to move the Second Reading of the Bill and now to wind up the debate.
  The hon. Member for Rushcliffe (Mr. Clarke) grotesquely suggested that co-operatives are a form of private enterprise. We on this side of the House entirely reject that view. We argue that co-operation is a form of endeavour which rejects the internal competitive hierarchical philosophy of private enterprise. We regard co-operation as a joint endeavour of equals, and that is one of the important qualitative differences between the co-operative structure and the structure of much of private enterprise.
  Indeed, I rather thought that by his intemperate attack on Meriden and KME the hon. Gentleman demonstrated the Conservative insincerity on this matter.
  802
  These co-operatives were established only because of what a previous Tory Prime Minister called the unacceptable face of capitalism, when a number of jobs were placed at risk.
  As the working party clearly demonstrated, and as I explained quite clearly, we naturally prefer not to form co-operatives in such a crisis situation. But often people look to a co-operative as the only solution when a decision has been made in the boardroom and when they have not been consulted about such a decision to end their working lives and throw them on the dole queue. Naturally, working men and women seek some alternative and in some situations they happen to alight on a co-operative alternative.
  But, of course, the Government, the Labour movement and my hon. Friends present tonight have made the point emphatically that they would prefer to see co-operatives established in favourable circumstances and favourable conditions. Clearly, where because of certain circumstances jobs are at risk or have been brought to an end, they are not the most favourable circumstances.
  To suggest that Meriden and KME, because of the unfavourable circumstances in which they started, were wrong to start is to do them a great disservice. As I pointed out in an intervention, such wanton attacks could cause severe difficulties for Meriden and KME.
  I should like to record that the notion that jobs were lost elsewhere because two co-operatives were started is demonstrably wrong. Certainly it was not the men at Meriden who made the decision at NVT to opt out of the small motor cycle market that was the growth area. Certainly it was not the men at Meriden who made the decision to opt for one model which was overpriced for the American market and could not sustain production.
  It is extremely unfair to be so critical of the people in both those co-operatives, where an important number of jobs have been maintained. They have shown initiative and endeavour. They have shown that working men and women, albeit with the help of management expertise, can succeed. Why the hon. Member for Rushcliffe should imply that co-operatives would want to dispense with

  803
  management expertise is beyond me. Working men and women involved in the co-operatives have demonstrated that relatively complex technological processes can be achieved in co-operative form and endeavour. That surely is worth while.
  I am concerned about the way in which the Opposition run down sections of industry in a way that suggests that, for example, they do not want to see KME sell radiators, as I mentioned in an intervention it is doing in Birmingham now, and that they do not want to see the Triumph Bonneville motor cycle, the last in any serious quantity production in this country, sold all over the world. That is surely what all hon. Members want to see—British products sold in the exports markets of the world. This sort of critical demonstration is clearly designed only to inhibit that sort of success.
  The hon. Gentleman asked for details of the financial circumstances of the two co-operatives. These are available from the usual sources published by the respective organisations. When, for instance. KME or Meriden applies for assistance, the matter will either be brought before the House in the usual way or any application will be treated with the confidentiality with which any application by any organisation is treated.
  Indeed, the hon. Gentleman's request for publicity and information about these two co-operatives is in stark contrast to the Conservative Party's view when it was in office and passed the 1972 Industry Act, because all the payments under that Act were virtually made in secret. They were not published. It was not until this Government came into office that in July 1974 we agreed to publish in Trade and Industry details of grants that had been made. But the applications still retain an element of confidentiality and the Department naturally recognises that confidentiality.
  Mr. Kenneth Clarke: Will the Minister confirm that under the Industry Act 1972 there is provision for a report of the Industrial Development Advisory Board to be made public when that board has advised the Government that it is not a commercially sound proposition to invest in an organisation such as Meriden or Kirkby, and that that report may be laid before Parliament? Will he confirm that
  804
  such reports have been kept confidential and that requests for them were refused in the case of the advice the Government received about Meriden and Kirkby, that it was not justified to spend large sums of taxpayers' money in supporting non-commercially viable organisations?
  Mr. Cryer: Reports are confidential to Ministers but if IDAB chooses it can draw a particular decision to the attention of the House. This is a matter for IDAB and not for the Minister. The hon. Member for Rushcliffe attacks co-operatives but never mentions the amount of money given to support private enterprise, amounts which many Conservative Members seek to gain from the Department of Industry. He never pointed out, for example, that in 1976–77 private enterprise received over £700 million in regional preferential expenditure. He did not mention that private enterprise receives about £2½, billion per annum in tax concessions on investment in plant and machinery.
  Naturally, we want private enterprise to invest and we give these incentives to provide an encouraging framework It is grossly unfair to attack two relatively tiny organisations and ignore that a large and significant sector of private enterprise is receiving support from the Government.
  The hon. Member did not mention the £5 million loan to Brentford Nylons, a private enterprise company. He made no mention of Courtaulds at Skelmersdale, which received over £5 million in loan and grant aid from the Government and closed down the factory at Skelmersdale. A section of that money is to be paid back but not all of it is recoverable. When one criticises support from the taxpayer one must mention both if one has a balanced judgment rather than pure, doctrinaire political prejudice.
  Mr. Peter Bottomley: I presume that the first two categories are available to co-operatives as to any other organisation. I hope that the Minister will confirm that. When other funds are made available to private enterprise or to other forms of private enterprise—I refuse to accept that a co-operative is necessarily a Socialist enterprise—is it made available when there has been a recommendation from an independent body that the money will be lost or when it is in great danger

  805
  of being lost, or it is made available when the company has been able to demonstrate that it will have a viable future?
  Mr. Cryer: The board recommends to the Minister and its recommendations are varied. The Minister takes into account the recommendation, whether it involves a co-operative form of endeavour or a private enterprise endeavour. The hon. Member for Rushcliffe also mentioned Mondragon and brought into relevance what he regarded as incentives. We have said that we regard co-operation as a significantly different form of endeavour. It is a joining together of equals in whatever type of endeavour it is. Far from the picture which the hon. Member for Rushcliffe drew of close parallels with private enterprise with incentives for those involved, the range of salaries within the Mondragon co-operative enterprise is relatively small. The managerial and professional members of the Mondragon co-op receive salaries below the comparable levels for similar jobs outside. That suggests that people are not motivated by gain alone and that some people are committed to ideals and to working for their fellow men. The notion of the hon. Member for Rushcliffe that people are motivated only by financial gain does not fit in with co-operative ideals.
  Mr. Kenneth Clarke: I have tried to resist the temptation to intervene, but, because of the sustained attack on me, I am grateful for the opportunity to intervene again. Does the Minister accept that no one is suggesting that anybody is motivated by gain alone, but that incentive is an important part of any industrial enterprise? I believe that in Mondragon the proportion of wages and salaries varies between three to one between the lowest and the highest. That is in stark contrast to the Meriden co-operative, which the Government supported. This began on the proposition that everybody in the organisation should be paid the same, that there was no need to bring in anybody from outside with management expertise or experience of management. But both those crack-pot proposition were abandoned after about two years of spending large sums of the taxpayers' money.
  Mr. Cryer: The hon. Member for Rushcliffe made one vaguely correct
  806
  statement in which he said that there was a particular range of salaries at Mon-dragon and that at Meriden there was a single salary level. My information is that that common level has been retained for all the employees, although there have been discussions on a production bonus which would be shared equally.
  During the life of the co-operative at least one person has received a significantly greater sum than the co-operators. The co-op has subsequently brought in management experts who receive higher salaries. But the important element is that the decision was not imposed by some distant boardroom or a group of people who had not consulted the work people. The decision was made by the co-operators themselves, as I assume the decision was made at Mon-dragon and at Scott Bader, that there should be a ratio of bottom to top salaries. The notion that the hon. Member for Rushcliffe puts forward, that parity of pay has been discarded by all except Meriden, is not true. In many co-operative endeavours there is a move to narrow the range of salaries. My understanding is that that is a specific and conscious desire on the part of the industrial common ownership enterprise at Scott Bader.
  The right hon. Member for Orkney and Shetland (Mr. Grimond) said that we should consider after three years the need for the Agency. There will be an annual report to the Secretary of State and that will be laid before Parliament. I hope that time will be given to debate this important report. Often we do not devote enough time to the reports that are laid before Parliament—the NEB report and so on. The progress of the Agency can be measured and hon. Members can say how they think the Agency should develop in the light of the report. That is an important democratic scrutiny.
  My hon. Friend the Member for Brent, South (Mr. Pavitt) and others referred to the minority report. I said in all innocence that the report was a reflection of the diversity of view that helped to strengthen the report. My hon. Friend said quite rightly that attempts to resolve these views would have delayed publication of the report and that would have meant that this debate would not have been taking place tonight. I am sure that

  807
  all my hon. Friends feel that it was vital that the Bill should be brought before the House. It has been a long struggle to get the Bill here. It is an important first step.
  My hon. Friend the Member for Glasgow, Maryhill (Mr. Craigen) asked for a specific assurance that co-ops would be treated the same as private enterprise applicants. They are treated in exactly the same way in respect of applications under the Industry Act 1972. Indeed, what I hope the CDA will do is to enable groups of people who lack the necessary management, accounting and marketing expertise to prepare full and proper forecasts, which the Department of Industry requires in order to make a proper judgment, to have that lack of expertise made up by the CDA, so putting them on a parity with many of the private enterprise organisations that can present their case because they already employ that sort of expertise. I draw my hon. Friend's attention to the case that I mentioned earlier, in which a co-operative venture failed because it got into the wrong hands, was unable to present forecasts and was dependent purely on a group of people who did not have its best interests at heart.
  The hon. Member for Cardigan (Mr. Howells) welcomed the Bill. He believes in a mixed economy. So do we all, I am sure. The only question is just what sort of mixture should be defined. The hon. Member will know that we can never precisely define the mixture of a mixed economy—otherwise, the Conservative Government could never have nationalised Rolls-Royce in 1971 and destroyed that particular margin.
  The hon. Member also mentioned small firms. I am grateful for his comments. He agrees that the Labour Government have consistently endeavoured to encourage small firms. He raised the point about any specific devolution of the CDA to any region. That will be a matter for the CDA. However, we want to keep the
  808
  organisation relatively simple, free and unbureaucratic, and consequently it would have to take those factors into account when deciding whether to spread out to any particular region, such as Wales, Merseyside, or wherever.
  Finally, in contrast with the vicious and vindictive attacks by the Opposition spokesman, my hon. Friends, in all their speeches, were quite clearly motivated by idealism. They clearly believe that people should work together, not against each other. Co-operation seeks to emphasise the positive relationships of help and good will that frequently motivate mankind. My hon. Friends were right to reject the selfish, greedy society so vividly portrayed by one of the two Tory spokesmen present tonight.
  We believe that the CDA is a symbol of Socialist idealism, an ideal cherished by the Labour, co-operative and trade union movements. We hope that this Agency will help society to move towards that ideal.
  Question put and agreed to.
  Bill accordingly read a Second time.
  Bill committed to a Standing Committee pursuant to Standing Order No. 40(Committal of Bills.)

  CO-OPERATIVE DEVELOPMENT AGENCY BILL

    CO-OPERATIVE DEVELOPMENT AGENCY (MONEY)
    Queen's Recommendation having been signified—
    Resolved,
    That, for the purposes of any Act of the present Session to establish a Co-operative Development Agency, it is expedient to authorise—

    (1) the payment out of money provided by Parliament of sums required by the Secretary of State for making grants to the Agency up to a maximum aggregate of £1,500,000;

    (2) the payment into the Consolidated Fund of any sums received by the Secretary of State under that Act.—[Mr. Graham.]

  EUROPEAN COMMUNITY (FRESHWATER FISH AND SHELLFISH)
  11.3 p.m.
  The Under-Secretary of State for the Environment (Mr. Kenneth Marks): I beg to move,
  That this House takes note of Commission Documents Nos. R/2005/76 and R/2641/76 on Freshwater Fish and Shellfish Growth.
  Both these proposals are derived from the 1st EEC Environment Action Programme which was approved by the Council of Ministers in November 1973. This programme stated as one of the main aims of Community environmental policy that quality objectives should be defined for the various environmental media—land, air and water—and for parts of those media, according to the use to which they would be put.
  The Government of the day supported this approach to environmental control at the time when the first programme was approved, and we support it now. We have consistently advocated flexibility of control whereby the quality required of a particular environment is determined by considering both the self-purifying capacity of that environment and the use that will be made of it.
  In so far as the two proposals under discussion tonight seek to translate this principle into practice, we welcome their preparation by the Commission. We are, however, less enthusiastic about certain of the detailed requirements which have been written in during this process of preparation and which, in our eyes, fail to take proper account of environmental realities.
  Before I deal in detail with each of these proposals, I think I should explain that the bulk of my remarks will be concerned with freshwater fish. As my Department's recent supplementary memorandum indicated, discussions at official level in Brussels of the freshwater fish proposal have made good progress, particularly in recent months under the Danish Presidency, and it now seems likely that the draft directive will be discussed at a Council of Ministers meeting scheduled for 30th May.
  On the other hand, the shellfish draft has made virtually no progress since it was put forward by the Commission in November 1976. Further developments
  810
  seem unlikely for some time. In these circumstances, I think that the House might prefer me to concentrate on recent developments on freshwater fish, and the Government's attitude to them.
  Mr. Nigel Spearing: Before he leaves the point about shellfish may I ask the Minister whether he has seen the report in last Saturday's "SS Times", concerning the possible withholding of cockles and mussels from the European market? It says that the cost of these is
  … for technical reasons, linked to the Green Kroner, and so consolidated with that for the winkles, based on a formula which estimates the differential ratio between the weight of the winkle and the gross weight of the shell … and although whitebait do not have shells the same criteria are held by the Commission to apply."
  Do these proposals from Brussels have anything to do with those which he is now describing?
  Mr. Marks: My hon. Friend gave the game away by referring to the "SS Times". I suppose that it is relevant now that San Serif has arrived in European waters. I am not sure whether I read in one of those "newspapers" that they are considering an application to join the EEC, but the question will have to wait for that day to be dealt with. I admire my hon. Friend's new technique for raising matters connected with the Common Market.
  To return to reality, the freshwater fish proposal was originally submitted to the Council in August 1976. There was some initial discussion in the Council's Environment Working Group in the first half of 1977, which has been renewed in the first three months of this year. We have been greatly helped in these discussions by the Government's links with the water industry which have ensured that our negotiators in Brussels have been armed with facts and figures based on the practical experience of water authorities.
  I should therefore like to put on record the Government's thanks to the industry for its support and advice during negotions on this proposal. Certain amendments have now been agreed to the requirements of the original proposal which are summarised in my Department's recent supplementary memorandum which is available to hon. Members. These amendments have generally moved the

  811
  proposal in the direction of greater realism and possible further changes are being discussed. I shall review briefly our original doubts about this proposal and describe the ways in which it has since been amended, removing some of these doubts in the process.
  In the early stages of discussion, we were concerned that the relatively unclear wording of the draft might be taken to mean that all rivers in which fish life occurred or could occur would have to be designated, and hence improved to the prescribed level. The Commission has now made it clear in discussions at official level, however, that discretion over the designation of rivers is intended to rest with the member States. We may expect to see this intention brought out in a future revision of the text.
  In the view of the United Kingdom, the adoption of this draft directive should mean that the quality of rivers already supporting fish life would be protected and maintained while rivers with no fish life could be improved. This effect is likely to be achieved only if the technical standards set out in the directive are both relevant and realistic. The Commission's original proposals did not qualify for this description.
  The Commission's own explanatory memorandum made it clear that the proposal was concerned with fish life. This did not explain the inclusion among the proposed quality requirements of certain standards which relate to eutrophication—a process linked to levels of plant and bacterial nutrients in water and possibly bearing on fish life only indirectly. There were others which concerned only the flavour and palatability of fish flesh. Recent discussions in Brussels have covered this question, and the Commission has indicated that these standards will either be dropped from the directive or be presented as guideline figures. In other words, although member States would be obliged to establish levels for such parameters for designated waters, they would not be obliged to adopt the guideline values contained in the directive.
  Mr. J. Enoch Powell: Did the Minister say earlier—this is fortified by his speech as it has continued—that, in addition to the memorandum of his Department dated 25th November
  812
  1976, there is a subsequent explanatory memorandum? I can assure him that, on request at the Vote Office for the papers relevant to these two documents, I found that it is only the explanatory memorandum of 25th November 1976 which was issued to hon. Members. Can he clarify this?
  Mr. Marks: I understood that a subsequent memorandum dated March had been published to the House of Commons and was available in the Vote Office today.
  Mr. Powell: I know that the Government have shown themselves to be sensitive to the difficulties of hon. Members. It is an impossible position if, in endeavouring to prepare oneself for these debates, one obtains the relevant papers from the Vote Office 24 or 48 hours in advance, only to be told, when the debate takes place, that there is an additional paper which has been placed in the Vote Office that day which could by no means, except by accident, come to the notice of hon. Members participating. I am not suggesting that this is the Minister's fault—of course it is not—but he must recognise that it makes it extremely difficult for hon. Members both to follow his argument and to participate in the debate.
  Mr. Marks: I knew from experience that this was always the concern of the House, and specifically asked that the document should be available in the Vote Office. I was given to understand that it was available in the Vote Office and that some hon. Members have obtained the paper from the Vote Office.
  Mr. Powell: I did not know that it was there.
  Mr. Marks: Hon. Members have just been handed a document dated 29th March from the Vote Office.
  Mr. Powell: The Minister is very patient, but the point is material to the business of the House. If a paper is placed in the Vote Office within a matter of hours of a debate taking place, there is no way in which hon. Members can be aware that there is this additional paper and so obtain it and familiarise themselves with it. I see that one of the hon. Members who takes an interest in these debates has made a foray in the course of this intervention. I do not know whether we

  813
  are to obtain further news from him. But I am sure that the Minister will realise that it is intolerable that there is no formal means whereby hon. Members intending to take part in a debate can be aware of the relevant papers.
  Mr. Marks: I have taken part in a number of debates on EEC documents, and the Government have always been asked by hon. Members to ensure that papers were available for those debates. The papers in this matter were available in the Vote Office from, I understand, 30th March. However, I will check up on that. Copies are available here now.
  Mr. Hugh Dykes: I am sure that the Under-Secretary of State would not want to mislead the House. Although earlier he was correct in saying that the additional memorandum had become available, it is certainly true to say, as the right hon. Member for Down, South (Mr. Powell) inferred, that the additional document, the explanatory memorandum, has only just now become available. I think that the right hon. Member has a valid point in saying that any hon. Member who had originally obtained the documents for the debate would in all logic assume that there were no other documents to emanate from the Vote Office, unless a specific attempt had been made by the Government to notify hon. Members that an additional document had become available. The Minister is certainly correct in saying that the additional document has been available today for hon. Members.
  Mr. Marks: I assure the hon. Gentleman that I shall ask my colleagues to check up on this in future and try to ensure that hon. Members receive the relevant documents. I am not quite sure how we shall notify hon. Members that additional documents are available, apart from making sure that they are available well before the day of the debate. I apologise if the right hon. Gentleman has only today been able to obtain the additional document.
  The main cause for our concern in the original proposal was that some of the values it specified were more stringent than would be required to protect fish life. This excessive stringency is demonstrated by a consideration of the state of the rivers of this country, many of which
  814
  contain thriving fish populations and yet would fail to meet the proposed standards.
  Evidence given by the National Water Council to a Committee of the other place stated that 89 per cent. of the rivers in England and Wales were capable of supporting salmonid and/or cyprinid fish, but only 13 per cent. of these rivers would comply with all the values originally proposed. This demonstration of the unrealistic nature of the standards is reinforced by the knowledge that they are also more stringent than those recommended by a group of scientific experts whose advice was sought by the Commission.
  We have pressed for an explanation by the Commission of its reasons for departing from these recommendations. In recent discussions—and partly in response to this pressure—the Commission has suggested changes to some of the more important standards, such as temperature and dissolved oxygen, which would bring them nearer to scientific recommendations previously ignored. We are still concerned at certain discrepancies between the two sets of values, however, for which the Commission has so far failed to give a satisfactory explanation.
  The monitoring which the original proposal required of member States has also been a matter of concern to us. Many United Kingdom rivers, particularly in Scotland, can be considered free of any foreseeable threat of pollution such as would endanger fish life. The original monitoring requirements could have placed the heavy and unjustifiable burden of sampling such rivers on the appropriate authorities. Some reduction in these requirements has been agreed, but it now seems possible from the most recent discussions in Brussels that further amendments may be made to avoid the imposition of this burden.
  We were also unhappy with the original provision that member States would have only five years from adoption of the directive in which to improve designated rivers to the prescribed standards. However, at the Environment Working Group meeting in Brussels last week there was considerable support for the idea that member States should be allowed five years from designation to improve water quality. This would mean that, in practice, there

  815
  would be up to seven years from adoption of the directive to make any improvements to the initial batch of designated waters. I say "initial" because it has also been agreed that the directive should be modified to ensure that designation is not a once-and-for-all process. Member States will be allowed to designate waters under the directive from time to time as resources permit, and in each case five years would be allowed to ensure that EEC standards were met.
  Further discussions at official level in Brussels are scheduled for this month. While there are still several difficult issues to be settled—it would be rash of me to predict what will happen—I think that a draft directive which was broadly acceptable to all member States could emerge at the end of the day. By "the end of the day" I mean next month.
  I turn briefly to the other document under discussion tonight—the proposal for a directive on the quality requirements for waters favourable to shellfish growth. This was formally submitted to the Council in November 1976, but since that time it has been discussed by officials in the Environment Working Group only twice—in February of last year and in February of this year.
  As I indicated earlier, there is far less likelihood of immediate progress on this than on the freshwater fish proposal. Nevertheless the Government, of course, attach importance to hearing the views of the House on both the papers. The Shellfish proposal has been so severely criticised on all sides in Brussels that if any new proposal does emerge it will have to be radically different from the original if it is to be acceptable either to United Kingdom or to other member States.
  The least satisfactory aspect of this draft directive is that, like the freshwater fish proposal, it fails to make its purpose clear and unambiguous. According to the Commission's explanatory memorandum, it is aimed at encouraging shellfish growth and not at protecting human health. Yet the proposed parameters are not consistent with this objective.
  The question of the intended scope and application of the draft directive also requires a clearer resolution than is provided by the rather vaguely worded articles of the proposal, which could be taken to imply that member States would
  816
  have to apply the provisions of the directive to all naturally occurring shellfish beds of whatever size.
  The uncertainty about the extent of the waters to be covered is similar to that which at first attached to the freshwater fish proposal and, as with that proposal, the Commission has now stated that member States are intended to have discretion in the designation of areas. Again, we shall look for a reflection of this intention in any finally agreed revision of the text.
  I think that there is no need for me to describe in detail the Government's reservations about other aspects of this proposal, such as the monitoring requirements and the five-year deadline set for the improvement of shellfish waters up to the prescribed standards. Our attitude towards these accords with the line we have taken on the freshwater fish proposal, and we would seek to inject the same impluse towards greater realism into any future discussion of the draft shellfish directive.
  As I indicated earlier, there are grounds for cautious optimism on the freshwater fish proposal, while the shellfish draft has gone back into its shell, so to speak. These are matters of great concern to hon. Members, and I shall be interested to hear their views.
  11.25 p.m.
  Mr. Hugh Dykes: I am sure that the House is very grateful to the Minister for coming to give us a explanation of the Government's attitude to the two draft documents—especially as it is at a later hour than usual. I do not want to take up too much time at this late hour, but a number of important points must be made in connection with these documents.
  I have the image of some official in the Lord President's Office, faced with far too many EEC documents, trying to decide in a panic how to process them through a difficult House of Commons. I have a vision of that official looking very quickly at the titles, ignoring the references and the numbers, seeing the word "fish" in both cases, and saying "Let the House have a debate on fish". It is a pity that the documents cannot go upstairs to the Committee, which might be a better place for them, despite the recommendation of the Scrutiny Committee. Instead we are lumbered, at a

  817
  late hour on a Thursday night, with two documents that are radically different, and dealing with wholly different subjects, even though both are connected with water.
  We sympathise with the Minister's dilemma in presenting the freshwater fish document. I gather that the other document is the responsibility of his colleague at the Ministry of Agriculture. I agree with him that the freshwater fish document is much more important and relevant, not only because it is going ahead in the Council of Ministers but because there are far more problems and question marks with the shellfish document.
  Perhaps a point should be made about the provision of documents. I know that the right hon. Member for Down, South (Mr. Powell) and I do not agree on the fundamentals of the EEC. Nevertheless, I share his concern that yet another strange twist in the sequence of events on the provision of documents for scrutiny has manifested itself tonight. I was extremely nonplussed to receive an updated memorandum which poses a whole new series of questions and issues, in the context of the negotiations for the Council of Ministers, which are extremely complicated and very technical. We all know the difficulties facing hon. Members in grasping these technical points without being able to have the time to get outside advice from the experts. We know the difficulties in grappling with a document which is quite in contrast to the original very bland document which implied that all these things were fairly routine, there were further discussions to come along, no new domestic legislation was required, that everything was in the general context of the Community's environmental programme, and that by and large everything was fine subject to some of the smaller details.
  Here now is an explanatory memorandum, dated 29th March and issued this morning, or maybe even this afternoon, which is worse, which goes into the very important headings of the negotiations, the Government's doubts and hesitations on this matter and the central areas where the Government would ask for further clarification from Brussels, and further information from the Commission on monitoring requirements, changes in the standards, and a whole host of complex
  818
  matters, which the Government seemed not to be very concerned with earlier on.
  I may be wrong but I do not recall such substantial changes in the nature, contents, characteristics and implications of an explanatory memorandum, which is inevitably interim in its nature, on any previous occasion.
  We are always ready to praise the Scrutiny Committee in making recommendations. I think it was right for it to take the steps it took because of the attitudes and hesitations about both these documents at that stage.
  There are a number of questions on the document dealing with freshwater growth. The National Water Council expressed a number of serious doubts about its contents and the anglers' organisations expressed reservations, as did others. The Committee recommended that the matter should be considered on the Floor of the House. Some hon. Members may have felt that it would have been more logical to take the matter in Committee upstairs if that were to be the regular form for consideration of these documents. But mostly that procedure is in suspense, except in the case of Statutory Instruments, which is a pity.
  One problem with both documents—and the one on freshwater growth in particular, which is the more urgent—is that they are so technical in their nature that we so have to rely on expert opinion that very few of us are able to argue cogently the parameters, technical data, threshold requirements and so on or deal with the chemical arguments relating to the anti-pollution controls envisaged in these directives. Perhaps the Government should have thought of a different way of dealing with the documents.
  We know that neither directive will require domestic legislation. Directives usually require legislation, but the main provisions are so sufficiently discretionary and broad in character as to allow us to use existing legislation in the United Kingdom and Scotland. But there will be problems later, which will depend on the ultimate negotiations.
  My personal view is that it would have been more sensible and sagacious if the Commission had produced a short, broadly-couched draft directive with three or four provisions allowing States to do what they are now doing. My impression

  819
  is that the United Kingdom has adequate controls, although slightly different in direction. Therefore, we shall be able to fit in with the draft directive and take the matter no further than that. I hope that that will be the general atmosphere and tenor of the negotiations in Brussels, particularly if the Danish are ambitious enough to hope for a final decision on the freshwater fish matter by the end of May, which would be a good thing and give much relief to all member States.
  The Minister need not comment in detail on all the other member States, but there are a number of variations in what States now do in regard to control for fish, and there is a strong argument for harmonisation which flows logically from the environmental action programme.
  I wish to ask a number of questions about the document on shellfish growth. Doubts were expressed in the House of Lords Scrutiny Committee about the evidence taken in the other place from expert opinion, and from a number of others who were not quite so expert. There are also doubts on the part of hon. Members in this House now that they have had a brief opportunity to examine the documents.
  The Minister is correct in thinking that it will take longer to make progress on the shellfish provisions. They relate to a wholly different area, and there is still conflict and confusion in the draft directive between health objectives and consumer protection for those who will consume shellfish and related products from the seas. I know that the Minister will have to speculate on this point, but, as the document proceeds, is there likely to be any adverse effect on employment and companies engaged in coastal enterprises in this country, because of the stiffer controls that we expect?
  The Government will also have to watch carefully as the second directive proceeds on its rather sluggish way because we may need to have a separate debate. I cannot prove it, but I am convinced that the Lord President's Office has arbitrarily mixed up these two separate subjects. When does the Minister expect the shellfish document to reemerge? Next time around, the House should be forewarned and forearmed so that it can garner expert opinion.
  820
  I recognise that the directives were constructed, like, I hope, all EEC directives, by conscientious Commission officials who took advantage of expert opinion and consulted people who know about these matters—scientists, chemical engineers, maritime specialists and marine engineers and scientists. Some of the proposals reflect that expert opinion, but the key issue is the extent to which, once an action programme is promulgated, ardent, zealous and, as we have heard, highly paid Commission officials should seek, perhaps sometimes too slavishly, to try to encapsulate details of an action programme in over-elaborate documents that can unnecessarily protract negotiations between member States as they try to sort out the technical confusion and scientific conflict.
  Also, can we tell from our experience of strong domestic legislation whether it is easier for modern societies to control the discharge of pollutants or to try to set quality standards? The Community's proclivity towards quality standards is much easier in respect of physical products—packaging, the shelf life of goods in shops and so on—but cannot be applied so readily to less easily controllable elemental matters such as water.
  I appreciate that, within the context of the action programme, we have had two directives relating to drinking water and bathing water. What other directives does the Minister envisage and how do the Government see the action programme developing? To what extent do they feel that they can get useful advice from other member States, perhaps particularly Germany and Holland?
  11.34 p.m.
  Mr. J. Enoch Powell: I should like first to make no fewer than three procedural observations. I feel that we can agree that procedural observations are often a not unimportant part of our debates upon these EEC documents since the House is, confessedly, feeling its way and improving its technique in handling this form of legislation.
  My first observation arises directly from earlier exchanges with the Minister in which—and I think that this was the general feeling—he agreed that it would be desirable that, on the day when a debate on such documents is taking place, there should be no doubt in the minds of hon. Members which explanatory

  821
  memoranda were relevant and available. I suggest—and perhaps this will be noted by the managers of Government business—that there is a very simple way of doing this which is already widely in use, namely, to use italics on the Order Paper.
  We have become accustomed, and I think to our advantage, to having italicised notes to Orders of the Day, and there would surely be no difficulty, beneath the Order of the Day specifying the EEC documents to be taken and the motion to be moved upon them, to draw attention to the explanatory memoranda which were held to bear on the debate. That would be covered by precedent, and I suggest that it would be convenient. I hope that consideration will be given generally through the Lord President's office to this possibility.
  My second point has been partly made already by the hon. Member for Harrow, East (Mr. Dykes), namely, that in any case the second of the explanatory memoranda—the meaty one, in fact—upon the live document before us, that on freshwater fish, was dated 29th March and became available only this week. With documents of this kind, it is the duty of hon. Members who wish to take them seriously, especially if the documents are technical in character, as far as possible to consult interests in their constituencies and elsewhere and to obtain advice. My hon. Friend the Member for Londonderry (Mr. Ross), who unfortunately cannot take part in this debate, has been to a good deal of trouble in the last week to consult interests in his constituency on the basis of the text of the EEC document and of the outdated explanatory memorandum.
  It is therefore plain that we cannot do justice to these documents, quite apart from the first point. I made, unless there is an adequate interval between the publication of the relevant explanatory memorandum which brings matters up to date and the debate taking place in the House. It would have been physically impossible for any hon. Member who wished to consult the interests concerned to do so on the basis of the information, which was the essence of the Minister's speech, in the explanatory memorandum of 29th March. Therefore, I hope that, even if we cannot have a rule, we can have an understanding that there will be an adequate interval between publication of revised background information to an
  822
  EEC document and the date on which the debate on it takes place.
  My third and final procedural observation is of a more general character and one which we have often had occasion to make in these debates. We are fortunate in a way in that the Minister has virtually put the extinguisher over one of the two documents we are considering. Certainly he has made it clear to the House, and to the surprise and novel information of many of us, that the stage of gestation reached by the two respective documents is a very different one. That puts the House in a great difficulty.
  We are accustomed to circumstances in which Ministers, on the basis of a document, inform the House that they have nearly got what they consider is desirable by way of modification before they agree to it. However, on one of the documents we are discussing the Ministers consider they have made substantial progress and appear to be within sight of their goal. On the other they virtually say that the document will have to be rewritten if it is to have their approval.
  The difficulty that is created is that it is most unlikely, with all the good will in the world on the part of the Lord President and the Government, that we shall have another debate in the House on these documents. Consequently, although we may have a fair idea of what is eventually to be the law in the document on freshwater fish we have no idea of what will happen over the coming months before finality is reached on the shellfish order. I hope that the Minister will be able to state that in view of what he said about that order the House will have, in due course, an opportunity of reconsidering the order before it is regarded as having discharged its duty of consideration. I think that I detect certain signs of affirmation from the Minister, of which I am glad.
  I come to the substance of the order that is live for our present purposes. I regard it as an example of the totally superfluous use of European Economic Community legislation so as to build up a corpus of EEC law on matters that are purely domestic, so that eventually by dint of sheer iteration the House and the British people will come to regard the European Economic Commission as the normal forum of legislation not merely upon matters of common interest to the

  823
  Community, and not merely on subjects for the purposes of which the Community exists, but for the whole range of legislation such as is passed by the House. So I enter my protest against the instrusion of the European Economic Community into an area in which its activities can be of no practical benefit to the country.
  We have been reminded that there have already been two orders in this series. I well recall the debate on the drinking water order, in which proper scorn was poured upon the notion that European countries should presume to set standards for this country for the supply of drinking water. That order came out of the mists and disappeared into the mists. It may be that it is already the law of this country. It may be that it is not. However, we continue to build the pyramid of EEC domestic legislation.
  Despite our ideological disagreements, I thought that the hon. Member for Harrow, East was quite near to my anxieties when he referred to the danger of zealots getting at these action programmes and using them as a means of building legislative empires of great complexity and detail. As regards the freshwater fish order, the fact is that our legislation—and this includes Northern Ireland, although I believe that the Control of Pollution Act 1974 has not yet been applied to Northern Ireland—is perfectly adequate to secure all that is necessary for the provision of the necessary environment for the growth and flourishing of freshwater fish. We have the powers that we need. The policies should be our policies, and we have pursued them with a considerable degree of success.
  I am informed that there is little problem about controlling the pollution of the waters in Northern Ireland in which the valuable freshwater fish of the Province are found. It may be said that in the European Economic Community there are catchment areas and inland waters that are common or limitrophic to more than one of the States of the Community. However, that is not a reason for Community legislation on the subject. We get on perfectly well in the United Kingdom with the Irish Republic, although the Republic's system of control of pollution is different from our own and although it
  824
  is administered by local authorities. They are happy in the Republic to be allowed to have local government, unlike Ulster. It is administered there by local government, not by the central authority. Nevertheless, the results are closely similar and co-operation between the two countries is complete and undisturbed.
  Long ago these matters were settled between countries which shared water courses and catchment areas. There is not the slightest reason to superimpose a European code in the greatest detail to continue to do what is already being done successfully and in perfect harmony between the partners concerned.
  I shall continue by drawing the Minister's attention to three respects at least in which there appears to be unnecessary complication in this draft directive.
  The first is the specification of two standards, one overlapping the other, for two classes of freshwater fish. It is difficult to see what justification there can be for drawing up two completely different sets of parameters for these two classes of fish. The existing law and powers of control are naturally used with a view to the kind of fish life that is found in the respective waters. But there is no need whatever to divide the fish into these two categories for the purpose of having two different codes of specification. It is superfluous complication: it is detail for the sake of detail.
  I should like to draw the Minister's attention to Article 10, the article under which the directive may be waived. One of the cases where it may be waived is when water "undergoes natural enrichment"—a gratifying phrase which one rolls lovingly around the tongue, but perhaps it conceals something rather less nourishing than it might suggest.
  According to the definition
  "Natural enrichment means the process whereby, without human intervention, a given body of water receives from the soil certain substances contained therein."
  There is such a process as the leaching of fertilisers, particularly phosphates, into water. Admittedly, the phosphates have been put there by human agency perhaps miles away, but the process by which the water has received those substances from the soil could fairly be regarded as devoid of human intervention. The same argument might be applied to the problem of

  825
  farm slurry which eventually is liable to find its way and to cause pollution in waters where freshwater fish are found.
  What is the exact meaning of Article 10? Does it include or exclude that kind of widely prevalent and seriously important pollution? That is an example of the combination which we often get in these orders of excessively generality with excessive detail.
  Finally, I support what was said about these standards seeming to have more than one purpose. They seem to be related partly to human consumption rather than to the welfare of the fish life in the waters. These are two entirely different considerations. There is no reason why the standards which are prescribed for the wellbeing of the freshwater life should necessarily be adequate and satisfactory for the purposes of human health and safety since, for example, the fish—this applies also to shellfish—may be deliberately treated for health purposes before human consumption.
  Quite apart from the more general criticisms that I have made, I think that a good deal of work still has to be done on this directive, superfluous though it is, before it is fit to be accepted and become a governing consideration that has to be taken into account in applying the law of this country.
  11.50 p.m.
  Mr. Nigel Spearing: I wish to ask only two brief questions. First, what is the object of these directives? The right hon. Member for Down, South (Mr. Powell) reminded us of the former directive concerning the quality of drinking water or water used for the processing of food. Quite clearly, the objective there was to ensure that intra-Community trade in foodstuffs subject to such water treatment would be of comparable quality.
  Nothing has been said, and I have not read anything in the documents or in the explanatory memorandum, about whether these documents are seen as a preliminary to saying that trade in freshwater or shellfish between countries within the Community shall be permitted only where the waters in which those fish are reared comply with the standards laid down. Unless that is the second stage
  826
  in the process I see no object at all in the directives.
  There is an alternative method, as has been said by the right hon. Member for Down, South, and that is for each member State to recognise, or not recognise as the case may be—and the right hon. Gentleman mentioned Eire as a case in point—the standards of other nation States, which would seem to me to be a simpler and more practical method. With the increase in air transport, I guess that many crustaceans and other shellfish arrive in the EEC from outside the EEC altogether, from third countries. That brings in yet another complication, in which the second method of control, if we are to have it, would be much more sensible. I hope that the Minister will tell the House something about the whole purpose of these directives.
  My second question is about the degree to which the Minister, through his Department, has consulted the interests to which reference has been made. The Department probably does not have natural and normal connections with commercial fishing interests, which would be more appropriately dealt with by the Ministry of Agriculture, Fisheries and Food. I refer in particular to the interests in the Thames Estuary. Whitebait, alas, have not yet come back to the Thames—at least not in commercial quantities. But there are many shellfish and shellfisheries in the Thames Estuary supplying East London in particular, the traditional market, and perhaps the Minister will say whether those interests, many of them small individual firms, have had an opportunity of seeing these documents, and whether he has received any representations or reactions from them or any other persons concerned with industrial fishing.
  11.53 p.m.
  Mr. Marks: Let me deal first with the points raised by the hon. Member for Harrow, East (Mr. Dykes). A late memorandum of this kind is probably due to my insistence that the House be given as much information as we can give it as soon as possible. As the meeting of the environment working group took place only last week in Brussels we got out an explanation, so far as we could give it, at as early a date as possible. Had we left it to the old memorandum and not tried to do something like this we should

  827
  have been due for rather heavier criticism than we have received here.
  The right hon. Member for Down, South (Mr. Powell) and other hon. Members have said that there should be a separate debate on shellfish. This is a matter largely for the Scrutiny Committee and for my right hon. Friend the Leader of the House. If we reached a stage in the consultations and negotiations where we felt that another explanatory memorandum ought to be produced we could send that to the Scrutiny Committee, and the Committee would put to the Lord President of the Council the proposal that there should be a further debate on that document.
  The hon. Member for Harrow, East asked what further water directives are envisaged. A draft directive on the protection of underground water has just been sent to the Council by the Commission, and it is due to be discussed for the first time by my officials next Friday. There is a directive on pollution from paper pulp mills. Having a constituency whose boundary is a river, the entire length of which in my constituency is what is called class 4 in the pollution ratings—it is painted brown on the maps that are issued—I should welcome European consideration of the need to improve such waters.
  If we can add our views to those of the other European countries, I am sure that that will be useful. Directives on the quality of agricultural and industrial water are other possibilities, but it is impossible to say when any of these would come forward.
  As to whether there have been consultations with the fishing industry—at any rate that part which is affected, the commercial part—these are carried out by my right hon. Friends in the Ministry of Agriculture, Fisheries and Food and we consult the water authorities, the water industry, angling and the other sporting interests.
  I was asked whether the shellfish directive would have any adverse effects on employment. I do not think that there is much reason to think so at the time, but this is one of the matters we shall bear in mind in future discussions.
  I was also asked what were the differences between the original explanatory memorandum and the one we have more
  828
  recently issued. All the changes were towards the United Kingdom point of view, quite a few to meet specific United Kingdom problems and in response to pressure from us.
  I do not know about progress on the shellfish directive. The Commission has been asked not only by us but by a number of other member States to start again and think out a new draft memorandum.
  The right hon. Member for Down, South asked for insertions in italics on the Order Paper. I shall put that to my right hon. Friend to see whether we can do what I want to do, which is to give as good a service as we can in the way of providing information to the House.
  The right hon. Gentleman also raised the general question, which I have heard on a number of EEC directives, whether it is a matter with which Europe as a whole should interfere at all. It is not a case of foreigners imposing legislation on us. Our own Ministers are involved in the making of the directives. I am sure that we value the opportunity to have some influence on other countries. The last EEC directive on which I spoke in the House was about bird protection. The House was delighted that we were trying to find a way of bringing the Italian people's view more in line with ours on the shooting of migratory birds.
  There was a question about two different standards for the two different types of fish. I am advised that the two species have different sensitivities to polluting substances, and therefore where rivers are particularly considered to be for one type of fish the standards that suit that fish should be applied.
  The right hon. Gentleman raised the matter of natural enrichment, and I think that he was right to suggest that in some ways "enrichment" and "pollution" were words for the same thing in this context. This is one of the matters on which we are seeking further clarification from the Commission. The right hon. Gentleman's points will be taken into account.
  The distinction made between standards necessary for the survival of the fish and those related to consumption of fish is an anomaly that we have pointed out in the discussions. The Commission now accepts that quality of water for fish is what the directive is about.

  829
  I am not able to answer this question at the moment, but I do not believe that it is envisaged that the export of freshwater fish will apply only to designated areas. We receive and export fish to and from countries which are not involved in the EEC.
  I am grateful to the House for the comments that have been made. Useful advice has been given. We shall take the comments into account in future discussions.
  Question put and agreed to.
  Resolved,
  That this House take note of Commission Documents Nos. R/2005/76 and R/2641/76 on Freshwater Fish and Shellfish Growth.

  EUROPEAN COMMUNITY (FRESHWATER FISH AND SHELLFISH)

    STATUTORY INSTRUMENTS, &c.
    Ordered,
    That the Order of the House of 17th March, that the draft Weights and Measures Act 1963 (Weighed-out Foodstuffs) (Restriction on Imperial Units) Order 1978 be referred to a Standing Committee on Statutory Instrument, &c., be discharged.—[Mr. Ted Graham.]

  THE HON. MEMBER FOR KINROSS AND WEST PERTHSHIRE
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Graham.]
  12.1 a.m.
  Mr. Nicholas Fairbairn: I am grateful to the Chair for being able to raise a matter which I consider raises important principles for the House and for the people of this country. Although it appears to be a personal issue, I have no personal hurt or feelings about it and it is not my intention to harass the Minister or his Department in any way. I hope that the Minister understands that. I am obliged to him for being present to reply to the debate. It raises grave matters for the House to which we need an answer which is not only truthful but which appears to be truthful and which can stand scrutiny.
  I shall give the facts of the matter. In May 1977 I was invited by the president of the mess of HMS "Caledonia" in Rosyth dockyard, which is near to my home, to address a mess dinner in July
  830
  of that year. On 23rd June I was informed that that dinner had been cancelled. I accepted that explanation but I wrote in the following terms to the president of the mess.
  "Being an advocate and an episcopalian and a Scot I have a naturally suspicious mind and I would like to be assured that there was a genuine reason for the cancellation of that dinner and that somewhere along the line I was not regarded as persona non grata personally or politically. The effect of a new date of course would confound my suspicions."
  I was assured that that was true. Thereafter I discovered that the dinner had been held and that another person had been asked to speak at it. Therefore, I felt it right to raise the matter with the Minister.
  On 7th December 1977 I wrote a letter which inter alia included the following remarks:
  "This refusal caused gross embarrassment to my host and to the naval commanders of the base including C-in-C Northern Command and the Admiral in Scotland who were bidden by your Department to silence. My host was required to explain to me that dinner had been cancelled, which it had not. Will you please kindly explain to me for what reason I was held to be politically unacceptable to address wardroom dinner and also inform me on whose instructions the letter was written to the Captain informing me that the invitation to me was to be rescinded?"
  The letter is on file.
  Mr. Nicholas Winterton: Outrageous.
  Mr. Fairbairn: On 30th January I received a reply from the Under-Secretary of State. What I am about to say is important. The Minister was ill. He had a most unfortunate illness, as we all have from time to time. For a period he was ill, but he graciously undertook his duties, and I pay tribute to that fact. I do not therefore wish to prey on the question of the delay.
  Nevertheless, on 30th January I received a detailed letter signed by the Minister which read inter alia:
  "As you know Ministers vet all invitations for Members of both Houses of Parliament to visit defence establishments for whatever purpose, and we thus have a good idea of those who have a genuine interest in defence matters. In particular I make it my personal concern to ensure that those Members invited to 'social functions' do indeed have a sustained interest in defence and have demonstrated such. My inquiries lead me to believe you have not paid any visits to HM ships or establishments, or to any Army or Royal Air Force establishment since your election to Parliament. Furthermore, I do not recall your

  831
  attendance at the two Navy debates I have fielded as Navy Minister, or for that matter any of the defence debates when I have been in attendance. Finally I arranged, with attendant publicity, for the Royal Navy presentation team to visit the House of Commons on 30th December 1977. As I had received your letter I made a particular point to check on your attendance. Unless you slipped in and out during the presentation while the room was in darkness I did not notice your presence among the 30 or 40 Members who were there. When I am confident that an hon. Member has demonstrated a genuine interest in defence matters I may feel much better disposed to encourage social visits."
  Mr. Ian Gow: Is that really true?
  Mr. Nicholas Ridley: What arrogance!
  Mr. Nicholas Winterton: Disgraceful.
  Mr. Fairbairn: None of the allegations in that letter was accurate or true. But, forgiving that, what I find unacceptable is that that was not a genuine, although much researched and time consuming, answer. In other words, it was an utterly false and untrue explanation of why I had been excluded from that dinner.
  I had the courtesy of meeting the Minister and his superior, the Secretary of State. Following that I received a letter from the right hon. Gentleman himself, in which he said that
  "the Under-Secretary of State for the Navy had declined to issue an invitation as being outside the guidelines for visits by Members."
  It went on:
  "He asks me to confirm in writing what he has already told you personally "—
  which the Minister had the courtesy to do—
  "that he completely withdraws the explanation offered in his letter and any suggestion of a lack of genuine interest in defence matters on your part, and that it was quite erroneous to suggest that such was the reason for not approving your visit."
  In other words, the explanation given, which took six or seven weeks to contrive and which took eight paragraphs to express, was a deliberate falsehood. That is something that causes me concern—
  Mr. Gow: And the country.
  Mr. Fairbairn: As a result I wrote to the Prime Minister, and it was because of that that I had the meeting which resulted in a letter. My right hon. Friend
  832
  the Member for Amersham and Chesham (Sir I. Gilmour) wrote thereafter to the Secretary of State. My right hon. Friend has asked me to express his regret for his absence tonight owing to public duty abroad. I regret that my right hon. Friend is not present.
  But my right hon. Friend asked the Secretary of State, and the answer that we now have is still that I fell without a guideline on procedure. But if I fell without a guideline on procedure, I think that the House of Commons has a right to know upon what basis a Minister of the Crown is entitled to say that a Member of the House of Commons can be excluded from a visit to a defence establishment or any other establishment on the basis of his interest or his disinterest. If there are guidelines, we are entitled to know what they are. What was the circumstances in which I fell without them?
  Mr. Nicholas Winterton: Is my hon. and learned Friend a security risk?
  Mr. Fairbairn: The Minister said in his letter that I was not a security risk.
  What are the guidelines which I or any other Member, or any Cabinet Minister or Shadow Cabinet Minister, fall without? Also, if so reasonable, so determinable, so explicable, so obvious and so agreed an explanation was the explanation, why did the Navy have to be told to tell a lie to me? If the Navy was not told to tell a lie to me, as the Navy did tell a lie to me, why did the Navy feel it to be its duty to tell a lie to me?
  I accept the Minister's word in his letter that the Navy was not required to tell a lie to me. Indeed, I accept the Minister's word as often as he changes it. But it is important to know why the duty was put upon the Navy to deny it, and why the Minister thought it necessary, if there was so innocent an explanation as guidelines, that he should contrive over seven weeks a letter in eight paragraphs which gave an explanation which he is required to withdraw as totally false.
  Others might say that it was a lie. I cannot say that it is a lie. All that I can say is that I cannot conceive an explanation as to why the Navy was required to give one explanation, the Minister gave another, and his superior has required him to withdraw it and give a third.

  833
  The House of Commons is being told that Members of it, unlike members of the public, cannot visit defence establishments if they fall outside the guidelines on procedure.
  Mr. Nicholas Winterton: Unpublished.
  Mr. Fairbairn: Unpublished. Those are guidelines and procedures about which no one knows.
  Unless the Government wish to have the words "tyrant" and "truant"—
  Mr. Nicholas Winterton: Dictator.
  Mr. Fairbairn: —and "dictator"—put upon their coat tails tonight, they must give us an explanation, and a true explanation, not only as to why I was banned and was given false explanations but as to who else will be and has hitherto been banned.
  12.13 a.m.
  Mr. Robert Banks: I think that we have here a case of great importance, because the Government are clearly in a complete and utter muddle over the guidelines that they may or may not have.
  I should like to give evidence to the House of a position that has gravely affected me. I received an invitation to attend a weekend reserve officers' course to address the officers and was told that I would not be allowed to do this. I then took the matter further with the Secretary of State, who told me that had they offered to give me dinner I could have attended happily.
  It appears that, on the one hand, I would have been allowed to address those officers on a full stomach, and, on the other hand, if perhaps my hon. and learned Friend the Member for Kinross and West Perthshire (Mr. Fairbairn) had gone on an empty stomach, he might have been allowed to address the officers of HMS "Caledonia".
  Therefore we have a great muddle here. The Government do not know which way they are going. We look to the Minister to clarify the situation tonight.
  12.15 a.m.
  The Under-Secretary of State for Defence for the Royal Navy (Mr. A. E. P. Duffy): I am grateful to the hon. and learned Member for Kinross and West
  834
  Perthshire (Mr. Fairbairn) for the manner in which he introduced this debate. I understand his feeling and that of his hon. Friends. But equally I know them well enough to know that they will bear with me. I shall try to be as helpful as I can not only to the hon. and learned Member but to his hon. Friends.
  My right hon. Friend the Secretary of State for Defence and I have already had discussions with the hon. and learned Member for Kinross and West Perthshire about events that followed the proposal that he should be invited to attend a guest night dinner in the wardroom of HMS "Caledonia" last July and to make an after-dinner speech. In the course of those discussions I agreed to withdraw unreservedly those remarks to which the hon. and learned Member took exception and my right hon. Friend agreed to review the procedures under which MPs visit Service establishments.
  My right hon. Friend subsequently reflected the outcome of these discussions in a letter which he sent to the hon. and learned Member on 16th February, a letter which was itself the subject of consultation. This letter has since been supplemented by a letter from my right hon. Friend to the right hon. Member for Chesham and Amersham (Sir I. Gilmour), who, I understand, cannot be present tonight.
  I trust the hon. and learned Member will understand, therefore, that I was a little surprised when I learned that he still considered that there were issues outstanding. Nevertheless, I now repeat the apology I conveyed to him privately.
  I am pleased to have this opportunity to point to the work done by my colleagues and myself to foster visits to the Services by hon. Members. I myself have been Minister for the Navy for nearly two years and in that time I have made arrangements for hon. Members to visit ships and shore establishments on over 80 occasions.
  Mr. Nicholas Winterton: It is not enough.
  Mr. Duffy: I agree that it is not enough.
  In addition, 92 hon. Members attended the Silver Jubilee Review of the Fleet at Spithead in June last year. That is a record which I am prepared to set against

  835
  those of my predecessors. Those totals have not been achieved without effort on my part—as I think the hon. Member for Macclesfield (Mr. Winterton) recognises. What he said is absolutely right. I have not awaited requests from hon. Members but have gone out of my way to ensure that they are aware of the opportunities which are available to them. The hon. Gentleman is aware of that.
  Mr. Ridley rose—
  Mr. Duffy: If I am to reply adequately to the hon. and learned Member for Kinross and West Perthshire, I hope that I may be permitted to continue.
  Nevertheless, it is important to avoid placing an undue burden on Service units by allowing them to be exposed to completely unco-ordinated requests for visits and also to avoid involving the Services in political controversy.
  Mr. Fairbairn rose—
  Mr. Duffy: No; I did not interrupt the hon. and lerned Gentleman and I know that he will return the courtesy. It is only on grounds of time that I do not give way.
  My colleagues and I therefore observe certain procedures in approving visits by hon. Members to defence establishments. Those procedures reflect the general understanding reached between my right hon. Friend the Member for Barnsley (Mr. Mason) when he was Secretary of State for Defence and the hon. Member for Ayr (Mr. Younger) when he was the Opposition spokesman on defence.
  A regular series of visits are arranged which are notified through the usual channels. These enable us to provide consistent briefing and to avoid any suggestion of bias in the selection of participants. Our procedures provide that other visits should normally be confined to three categories: first, visits in which a Member has a clear constituency interest—
  Mr. Fairbairn: I live within three miles of it.
  Mr. Duffy: —second, visits by Select Committees; and third, visits by a right hon. or hon. Gentleman who is a Front Bench defence spokesman.
  836
  Now I come to this debate, which relates to the subject of the
  "banning of the hon. Member for Kinross and West Perthshire … from attending a mess dinner on HMS 'Caledonia', Rosyth".
  I have not banned the hon. and learned Member from a defence establishment. If I had ever taken it in my mind to do so, I should, of course, as a matter of common courtesy, have mentioned it to the hon. Member concerned.
  Mr. Nicholas Winterton: But the hon. Gentleman did not.
  Mr. Duffy: In the case in question, HMS "Caledonia" sought my permission to extend an invitation to the hon. and learned Member for Kinross and West Perthshire to attend a guest night dinner and to give an after-dinner speech. As my right hon. Friend said in his letter of 16th February, I
  "declined to authorise the issue of such an invitation as being outside the guidelines for visits by Members".
  Mr. Fairbairn: Will the Minister give way?
  Mr. Duffy: I shall not, in view of the time. The hon. and learned Member has had half the time available.
  Mr. Winterton: The Minister has had over half the time.
  Mr. Duffy: I have not. I took the view—this is perhaps arguable—that the making of a speech on such an occasion would breach the long-established practice of avoiding political questions on Service premises, and having declined permission to issue an invitation I had no reason to suppose that an invitation had been issued.
  Mr. Fairbairn: Why does the Minister not give the real answer, then?
  Mr. Duffy: Now let me take up some of the points raised by the hon. and learned Gentleman.
  Mr. Fairbairn rose—
  Mr. Duffy: I am trying to help the hon. and learned Gentleman, if he will allow me to proceed. Contrary to what he suggested in his speech, the guest night dinner was cancelled. A normal mess dinner was held on 7th July last in HMS "Caledonia" but no outside speakers were invited.
  Mr. Fairbairn: Yes, they were, and I can tell the Minister who they were.
  Mr. Duffy: Secondly, I am asked what explanation or lies were directed to the captain of "Caledonia" and to Flag Officer Scotland and Northern Ireland. A letter was written to the captain of HMS "Caledonia" saying that I had not agreed to the proposal to extend an invitation to the hon. and learned Member. This letter was copied to FOSNI. There was no other correspondence, as far as I am aware.
  Mr. Ridley: Did the Minister send a copy of this letter to my hon. and learned Friend?
  Mr. Duffy: Thirdly—
  Mr. Fairbairn: Will the Minister give way?
  Mr. Deputy Speaker (Mr. Oscar Murton): Order.
  Mr. Duffy: I was asked what is the basis for the guidelines. I was then asked more specifically what are the guidelines. As I have said, my right hon. Friend has offered to discuss future arrangements for visits with the right hon. Member for Chesham and Amersham, and I know that hon. Members will understand that I cannot anticipate the outcome of these discussions.
  Mr. Fairbairn: Will the Minister give way?
  Mr. Duffy: Finally, if I may come to the question raised by the hon. Member for Harrogate (Mr. Banks)—
  Mr. Gow: On a point of order, Mr. Deputy Speaker.
  Mr. Deputy Speaker: Mr. Duffy.
  Mr. Duffy: If I may reply to the hon. Member for Harrogate, I hope that the House will see that I am trying to be helpful. The hon. Gentleman will know that the matter he raised does not really relate to me. He might have raised it with my hon. Friend in the debate on the Royal Air Force last Monday afternoon.
  Mr. Banks: I am grateful to the Minister for giving way because this is a very important debate. My hon. and learned Friend is seeking to intervene on some very important matters. I would not
  838
  wish the Minister to use the points that I was making as a detraction from the main cause of this debate. I used them only to show what a muddle the Government are in.
  Mr. Duffy: Then I cannot understand why the hon. Gentleman intervened.
  Mr. Fairbairn rose—
  Hon. Members: Give way.
  Mr. Fairbairn: Will the hon. Gentleman give way?
  Hon. Members: Resign.
  Mr. Deputy Speaker: Order. Hon. Members must listen to the explanation which the Minister gives. If the Minister does not choose to give way, he cannot be pressed to do so.
  Mr. Duffy: The hon. and learned Gentleman will know that he has received a letter from my right hon. Friend, as indeed has the hon. Member for St. Ives (Mr. Nott).
  I now resume my speech, having taken up those points.
  During my absence this week in America, where I was visiting units of the United States Navy and SACLANT, a proposal reached my office from the Port Admiral Rosyth that arrangements should be made for a visit in the near future by hon. Members whose constituencies represent the main catchment area for the base civilian work force. I shall be writing shortly to the hon. Members concerned, but I am glad to take this opportunity to extend the invitation to the hon. and learned Member for Kinross and West Perthshire.
  But, returning to the proposed invitation to the hon. and learned Member to attend a guest night dinner and to make a speech, I would refer him to the letter sent him by my right hon. Friend, which confirmed what I had already told him personally. To the explanation given in that letter I should like to add only that I was quite unaware of the hon. and learned Member's private visits to HMS "Caledonia", HMS "Cochrane" and Rosyth dockyard, or of his participation in the naval hospitality bureau at Rosyth, until he drew our attention to these activities and interests in February of this year.
  Mr. Fairbairn: Will the Minister give way?
  Mr. Duffy: No.
  Mr. Fairbairn: Give me an explanation now then.
  Mr. Duffy: That is what I am trying to do if only the hon. and learned Gentleman will be patient.
  Mr. Gow: On a point of order, Mr. Deputy Speaker.
  Mr. Deputy Speaker: The Minister must be heard out.
  Mr. Duffy: Turning to the wider question of procedures—
  Mr. Gow: On a point of order, Mr. Deputy Speaker. Is it in order for a Minister of the Crown to purport to reply to an Adjournment debate while giving no reply at all to the points that have been raised?
  Mr. Deputy Speaker: That is not a point of order. The Minister is now in the process of replying to the debate.
  Mr. Duffy: Turning to the wider question of procedures governing visits by hon. Members to defence establishments, my right hon. Friend told the hon. and learned Gentleman in his letter that he would seek by a re-examination of the procedures to avoid possible future misunderstandings.
  Mr. Fairbairn: That is a lie.
  Mr. Nicholas Winterton: It is a downright bloody lie.
  Mr. Duffy: My right hon. Friend is already in touch with the right hon. Member for Chesham and Amersham on this matter, but I should like to make clear now—
  Mr. Ridley: On a point of order, Mr. Deputy Speaker. I distinctly heard my hon. Friend the Member for Macclesfield
  840
  (Mr. Winterton) say that the Minister had told a deliberate lie. Are you asking my hon. Friend to withdraw that statement? If not—
  Mr. Deputy Speaker: Order. If the word "lie" were used in connection with any Member of this House it must be withdrawn. If it—
  Mr. Ridley rose—
  Mr. Deputy Speaker: Order. Will the hon. Gentleman resume his seat forthwith? Mr. Duffy.
  Mr. Duffy: I should like to make clear—
  Mr. Fairbairn: On a point of order. Mr. Deputy Speaker—
  Mr. Duffy: I should like to make clear now that it is not our intention to inhibit hon. Members from attending purely social occasions, be they in a wardroom or in a ratings' mess, provided, of course, that such participation is not used for political purposes. I am sure that hon. Gentlemen fully share our anxiety to avoid any embarrassment to the Services.
  In conclusion, let me assure the hon. and learned Member once again that there is not and never has been any question of imposing a ban upon visits by him or his friends. On the contrary, I have gone out of my way to encourage such visits from both sides of the House. This was acknowledged by one of his hon. Friends in last year's Royal Navy debate. Moreover, I have received many kind letters from his hon. Friends thanking me for the arrangements I have made—
  The Question having been proposed after Ten o'clock and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
  Adjourned at twenty-nine minutes to One o'clock.