WHISKY OUT OF BOND

HC Deb 16 May 1978 vol 950 cc403-29

'The duty of excise charged on whisky shall, instead of being payable on removal from warehouse as specified in the regulations made under section 16(2) of the Finance (No. 2) Act 1975, be payable—

1. (a) from 6th April 1979, on the 14th day following the day on which duty was charged;
2. (b) from 6th April 1980, on the 28th day following the day on which duty was charged;
3. (c) from 6th April 1981, on the 42nd day following the day on which duty was charged.'.—[Mr Younger.]

Brought up, and read the First time.

11.0 p.m.

Mr. George Younger (Ayr)

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

I should first declare an interest in that I am a director of a company which, although it does not make any whisky, sells a considerable amount of whisky both at home and abroad. I cannot remember whether this is the eleventh or twelfth occasion upon which I have taken part in a debate on the subject of the whisky duty and the effect that it has on the industry. However, tonight's debate gives us the chance of approaching the subject with rather more hope than we have had on any of the other occasions in previous years when we have raised this matter with the Government.

First, I should like to describe briefly the object of the new clause. At the present time, as hon. Members will know, the duty payable on whisky is actually payable to the Revenue before withdrawal from bond. Therefore, the duty cheque has to be payable before the whisky may be extracted from bond. Thereafter, the whisky has to be transported to the customer who will sell it, and that customer, in the normal course of trade, is given a period of credit before he has to pay his account. This is normally between seven and eight weeks. Therefore, the duty which is payable before the whisky comes out of bond has in most cases to be carried by the producing firm for a period of seven or eight weeks.

The new clause would effectively, when fully in operation, delay payment of the duty for a period of six weeks after withdrawal from bond. Although this would not completely eliminate the difference in time between payment of the duty and receipt of the money from the customer, it would go a very long way towards it. I think that that would be very valuable.

Mr. Crawford

Will the hon. Gentleman explain why it is that now, after three years, his own party has seen fit to move this new clause? Will he also explain why, having abstained on the new clause which the SNP has sought to move during the last three years, he is now seeking to make this point? The SNP has been in favour of this for the last three years and my hon. Friend the Member for Banff (Mr. Watt) raised the subject in an Adjournment debate. Why are the Tories now moving this new clause?

Mr. Younger

I am sorry that the hon. Gentleman felt it necessary to intervene with that remark, particularly as he is totally inaccurate. I was taking part in the debates on this subject long before he was even a Member of the House. If he wants chapter and verse for what I assert, I remind him that on 18th May 1976 the Committee of which he was a member discussed a proposal moved by a friend of many of us, Sir John Hall, who, alas, died recently, on which not only I on several occasions but the hon. Member himself spoke.

Mr. Crawford

Tell us the vote.

Mr. Younger

He can discover what the vote was if he looks in the appropriate place in Hansard. But I can tell him that I voted as he did. I do not know whether his memory is failing him. I suggest that before he tries to make clever interventions of that sort he should get his facts right.

I move on to the costs of my proposal. The clause meets one of the main criticisms of the Minister in previous years, which is that the cost would be too heavy to bear if this proposal were implemented in one fell swoop. This clause not only phases the change over three years but does not commence the change until April 1979. So the good bit of news that I have for the Financial Secretary is that, worried as he must be about the financial state of the Budget for this year, here is one change that will have no effect in this financial year.

The change starting in April 1979 would be effected in three phases and, by the calculations that I have been able to make, each phase would involve a once-and-for-all cost of between £55 million and £60 million. I notice that this tallies reasonably closely with the figures given in a letter from Mr. Christopherson of Customs and Excise. He calculated that a delay of four weeks would cost £120 million and that one of six weeks would cost £180 million. We seem to be fairly well agreed about the cost of implementing the new clause. There would be no cost this year, and there would be a cost of between £55 million and £60 million each year for the three financial years following. Thereafter, there would be no cost whatever.

I do not think that the Financial Secretary can argue that the clause represents an unacceptable charge on the Exchequer. I hope that that fact will encourage him to accept it.

Mr. Russell Johnston

It is clear that the hon. Gentleman is putting forward the official view of the Opposition Front Bench. Therefore, perhaps he can explain why the Opposition did not pursue this line when they were in Government between 1970 and 1974. There may have been very good reasons. Perhaps he will remind the Committee what they were.

Mr. Younger

I do not want to go into them at great length, but my first comment is that during that period there was not the severe and very extreme inflation which we have had since 1974. The hon. Member for Inverness (Mr. Johnston) knows very well the way in which the whisky industry is organised and that inflation has had a severe effect on it. In a moment or two I shall detail one or two facts to demonstrate that in the last few years the effect on the whisky industry has been pretty severe. I hope that we shall have the support of the hon. Member for Inverness and his colleagues. I am sure that he has a large number of people in his constituency who are dependent on the industry. In view of that, I am sure that he will wish to be to the forefront in supporting the new clause.

There is no doubt that the carrying of the sum of money as I have described for six to eight weeks places a considerable burden on the industry as a whole. The scale of this can be best illustrated by taking the cost of a single bottle of whisky and apportioning the amount of duty. The average price of a bottle of whisky is £4.20. I know that it can be bought more cheaply, but that is about the average. Of that £4.20, £3.16 is accounted for by duty. Another 31p is accounted for by VAT, leaving only 73p, which is the real cost of the bottle. The carrying of such a large percentage of the value—80 per cent. of the sale price—imposes a heavy deadweight charge on the industry.

It is obvious that this inhibits investment in the industry and also the cash flow of many firms. This point has been made by a number of companies in the past two or three years. That is why there have been amalgamations of firms which might not have been necessary had this problem not existed.

Mr. Powell

Can the hon. Member estimate the cost in terms of interest of carrying the duty due for a period of seven weeks? Can he indicate also whether this charge, like all other charges is not spread over all the links in the process, from production to consumption?

Mr. Younger

I am not sure about the right hon. Member's first point. I have not been able to make a precise calculation of how much this would amount to on each bottle, but it is certainly quite a number of pence. On the latter point, the amount is carried in the ultimate price for the product, as every cost on the industry is bound to be, but it is the producing company which has had to carry the smaller cost of maturing the whisky over a three-year period which also has to carry this large sum for the six weeks.

This charge is not very even-handed when compared with that on other products of a similar type in the same sort of industry. Whereas whisky has to carry this amount, beer does not because beer has deferment for 39 days between the day when the duty has to be paid and actual production of the money. British wine has 29 days' grace. Therefore, with these two products the principle has been accepted that it is not strictly right that this amount should have to be produced at an early stage in production. This is another reason why the Minister should look at the new clause sympathetically.

The vast majority of our EEC partners have some form of deferment for spirits. In Belgium there is deferment until the fifteenth day of the fourth month following the day of delivery for consumption. In West Germany it is the fifteenth day of the third month. In Italy 15 days are allowed for payment of half the excise duty, with 30 days for the other half. And so it goes on. If we are to compete on fair terms with other products in the Community, we should move in the direction of the new clause.

11.15 p.m.

It has been said that there would be technical difficulties about making a change of this sort. We are grateful to the Minister for what has been done. Over the past year a great deal of progress has been made towards satisfying everyone that there are no technical difficulties in making a change.

Mr. J. W. Rooker (Birmingham, Perry Barr)

The hon. Member made various comparisons with the European Community. Can he elaborate a little more? I was not aware that there was a great deal of whisky manufactured in the Community, and the new clause applies only to whisky. If other spirits are involved, why is there not a new clause dealing with spirits other than whisky, on the basis that there is not a lot of competition in the Community?

Mr. Younger

The hon. Member has raised a good point. The new clause applies only to whisky. We are hoping, because this is the strongest case, to establish the principle. It is true that, if we can do so, logically it ought to be applied to spirits generally and to imported wines. It would be our hope, if we can establish the principle, that the issue could be raised at a later stage to put these other matters on all fours.

Mr. Russell Johnston

Is the hon. Member satisfied that such a change would be acceptable within the European Economic Community in terms of the rules of competition concerning spirits?

Mr. Younger

Certainly. I am satisfied that sooner or later the present disparity between these various beverages will be unacceptable to our partners in the Community. We should, if we are looking ahead, be expecting this change, or something like this change, to happen at some time. Unless there is any reason why he should not do so, I hope that the Minister will accept the point sympathetically.

During our debates in Committee last year, the Minister was extremely helpful and referred to the issue in considerable detail. He used these words: duty deferment is a matter that I am considering. I hope that I shall be able to have some discussions with the wine and spirit industry to look at some of the practical implications of taking some action on deferment. I hope to undertake this over the next 12 months before next year's Budget"—[Official Report, Standing Committee D. 19th May 1977; c. 36.] That was fair enough. The Minister has been as good as his word. Fruitful discussions have taken place between the Wine and Spirit Association and Customs and Excise on this matter.

There was a letter to Mr. Plowman, of the Wine and Spirit Association of Great Britain, dated 22nd December 1977 from Mr. Christopherson, of Customs and Excise, which clearly spelt out the conclusions of those discussions and said what, in his view, would be the cost of this change. It was made clear that there were no absolute technical problems involved. It is fair to add that he stated categorically that this fact did not in any way commit Ministers to agree to the change. I accept that that is the position today. The Minister has not committed himself to make a change, and it is our object to try to persuade him to do so tonight.

No one can doubt that this is an extremely important industry. It makes a contribution to providing jobs in Scotland, particularly in the remote areas where jobs are difficult to come by. In 1977, no less than 93 million proof gallons, worth £512 million, was exported. That is an extremely fine record.

There is no doubt that the increasing effect of these duties upon the industry and consumers has had a serious effect on home production during the past few years, as is shown by the production figures. In 1974, 183,000 proof gallons was produced whereas in 1977 only 151,000 proof gallons was produced. That is a drop of about 20 per cent. It is this aspect and the loss of job opportunities that is entailed that should at long last turn the scale, in this longstanding saga, in persuading the Minister that this time some help is needed.

The Government have to deal with a serious unemployment problem—a problem about which they, as well as the rest of us, are deeply concerned. But Ministers tell hon. Members that there is little they can do about the situation and always add that they wish they could do more. Here is something positive that could be done now by the Government to help an industry whose jobs are very important indeed to many parts of Scotland. I hope that I have made a case of which the Minister will be aware and that the argument will reach such a pitch that at long last it will be conceded. It makes economic sense and sense in terms of fairness between whisky and other industries which should be treated similarly. It is a long-standing matter which we have debated for many years. Surely, this year is the year to bring the matter to fruition.

This year the new clause is specially designed to make matters easy for the Minister. In this proposal there would be no cost to the Exchequer this year. It gives the right hon. Gentleman plenty of opportunity to make plans for the time when the relatively small cost involved in this exercise in the next three years comes to be felt in a future Budget. I hope that tonight we shall see the culmination of 12 years of pressure and that our proposal will be accepted by the Government.

Mr. Hamish Watt (Banff)

Although my colleagues and I welcome this opportunity to press these proposals, we find it galling that, once again, our new clause has not been called. The SNP has been consistent in pushing the case for deferment of duty since we came to the House in 1974, and as long ago as 22nd January 1976 I had an Adjournment debate on this subject.

Mr. Lamson

The hon. Gentleman said that his party's clause had not been called. I have been unable to find it on the Amendment Paper. Will he tell us what number it is and on which page it appears?

Mr. Watt

I assure the hon. Gentleman that we submitted proposals on spirits in total, but not on whisky in particular. We have always maintained that the provision must cover all spirits. We are particularly concerned that whisky should be covered because it is a subject that is most important for Scotland. Nowadays whisky is made, matured, blended and sold by reputable companies, although I admit that in the past this was not the case. It was important that Customs and Excise could get their money before they allowed anybody to take whisky out of bond. But this is not now the case, and we are merely asking for comparability.

Mr. F. A. Burden (Gillingham)

On a point of order, Mr. Godman Irvine. We are anxious to know what is in the clause that has not been called. Since we cannot find it, perhaps you would tell us where it is.

The Second Deputy Chairman (Mr. Bryant Godman Irvine)

If the hon. Gentleman looks at the very beginning of the Amendment Paper, he will find a note that clarifies the position completely. That will indicate to him where that item can be found.

Mr. Watt

We are consistent in requesting deferment of this duty, and I believe that it is essential that we should take this decision tonight. There is a very strong case for supporting the whisky industry because it is such a valuable contributor to the Exchequer. It contributes £512 million to the nation, and a great deal of cash accrues to the Exchequer from the sale of whisky.

It is vital that this industry should be given parity with the beer industry or the wine industry. There is no better time for the Government to do it than this year or next year. A great deal of oil money is coming into the country now, and if that money is to be used sensibly it must be used to bolster up our viable industries. The whisky industry is no lame duck like shipbuilding or even the motor car industry. It is a viable, thrusting and thriving industry which has always paid its way and always will pay its way.

The whisky industry is not asking for a handout through the new clause. It is asking only for the use of that which is its own. The industry is, I believe, more viable than any other in Britain, with the possible exception of tourism. It has no import materials in its production. It does not have to import expensive raw materials as so many other industries do. I say again that it is time that the Government gave the whisky industry parity.

As the hon. Member for Ayr (Mr. Younger) said, the industry is an employer of labour in many rural and urban areas of Scotland where no other jobs are available.

It is asking a great deal of the industry that it has to find £19 million every year to finance the early payment of tax, which is what it amounts to. It is not a deferment we are talking about here. We are talking about parity. It would be far better to let the industry have its own money so that it could finance the laying down of more stocks. It is in everyone's interest that stocks should be laid down now. Whisky which is being made this year and next year will not be drunk until the early 1980s at the earliest, or in the case of mature whisky not until the mid-1980s, and some of it will not be drunk until 1990. That is a very long period for any industry to have to work to, and it is important that the whisky industry should have the use of this cash.

The new clause is absolutely reasonable. It will not hurt the Exchequer this year. It will not hurt the Exchequer at any time, since it provides for phased steps forward to the parity which the industry has long sought.

I shall be interested to see how my colleagues on the Liberal Bench vote tonight, especially those who have whisky distilleries in their constituencies. I shall be particularly interested to see how some hon. Members on the Government side vote, especially those with blending and bottling factories in their constituencies. This is a wonderful opportunity to do the right thing by the whisky industry, and I commend the new clause to the Committee.

Mr. Rooker

I am not sure whether I am in favour of the new clause but I should have thought that, with all the problems which we discussed last week, the Government need to get their hands on every pound of tax and duty as quickly as possible, as it becomes due. But the idea seems to be to take out of circulation, as it were, £180 million on the six-week basis and £120 million on the four-week basis. It is still money that would be lost. The hon. Member for Ayr (Mr. Younger) shakes his head, but he gave the figures. I have not got them from anywhere else. He said that it was roughly £50 million or £60 million a year.

Mr. Younger

I made the point that there is no cost at all this year.

Mr. Rooker

I accept that entirely; but Governments do not work on a hand-to-mouth basis. No modern responsible Government running our country's affairs can work on a hand-to-mouth basis in taxation. That may be the Tory Party's idea of running our affairs, but it is not the Labour Party's. It is still £180 million of tax cuts.

Mr. Younger

No.

Mr. Rooker

It is a tax cut in the sense that it increases the cash flow in the industry by £180 million over three years. I accept that it is a once-for-all payment, but in total it is £180 million over six weeks. That is not chicken feed. It could be spread on many small items over several years, or it could be a once-and-for-all payment to the construction industry, where extra employment is valuable. The sum of £180 million is equivalent to ½p off income tax. It is not an insignificant sum.

11.30 p.m.

I repeat that I am not sure whether I am in favour of the proposal. I do not know whether it applies to Irish whiskey, or whether the problems relating to Scotch whisky apply in Northern Ireland, or whether the bonding situation—which is very peculiar to this industry—that applies in Scotland applies in Northern Ireland.

If the new clause is approved, I am concerned about the effect it will have on whisky on which no duty is payable. We did not hear anything about this from the hon. Member for Ayr. If the new clause were accepted, it would cost the Revenue money on a once-and-for-all basis. The Revenue loses money on a considerable amount of whisky on which no duty is paid.

I refer hon. Members to the appropriation accounts, House of Commons Paper 138, presented to the House on 31st Janaury of this year. In paragraphs 56 to 60 inclusive the Comptroller and Auditor General pointed out that there is a massive tax fiddle going on due to the fact that there are 250,000 proof gallons of whisky a year on which no duty is paid. This whisky is that which is drawn off for sampling. It is not an insignificant amount of whisky. When one realises that from each cask or vat of whisky one-tenth of a gallon may be drawn off for sampling purposes, one can see that there is scope for abuse. [Laughter.] Hon. Members may think that this is funny, but some £7 million in revenue is lost each year in this way. Many areas of the public service would benefit greatly from the injection of £7 million.

However, not all of it is abuse. Much of the whisky drawn off in this way is used for sampling. The Comptroller and Auditor General said that he asked the Customs and Excise what it was doing about this matter, it having been drawn to its attention. The Comptroller and Auditor General said in paragraph 58: The Department have no direct information on the ultimate use of duty-free samples, but they have long been aware from investigations undertaken for other purposes that it is not uncommon for such samples to be added to duty-paid stocks. So who makes the profit on that? It is £3.16 on a bottle, plus VAT. Who makes the rake-off on that—the wholesalers or the retailers? The public pay duty on bottles of whisky at the rate of 80 per cent., according to the hon. Gentleman, and that duty does not go to the Revenue. We are losing £70 million a year.

Reference has been made to our Common Market partners and to the need to harmonise our affairs. These sampling arrangements of one-tenth of a gallon per cask are unique. The United Kingdom allows a very generous amount to be taken for sampling purposes compared with our Common Market partners. I should like to know what is happening in terms of harmonisation.

Mr. Watt

Does the hon. Gentleman appreciate that a cask can hold about 110 gallons of whisky? He is taking up the Committee's time by talking about a thousandth part of the cask.

Mr. Rooker

I am taking the Committee's time to ask those who support the clause, which will cost the taxpayer, the Revenue, £180 million over three years, whether it is their intention to put duty on all of the whisky. I have made the point that on 250,000 gallons—a relatively small amount in percentage terms—there is no duty paid. It is clearly stated in the report of the Comptroller and Auditor General to the House of Commons that there is a tax fiddle going on, because some of that whisky is later sold to the general public. This abuse needs to be stamped on.

Will anything be done about this? It is clear that the housekeeping arrangements of the Customs and Excise and the distillers are not all they should be. It is accepted in every distillery, according to the Comptroller and Auditor General, that the maximum allowable sample is always taken. There is never a cask where there is a need to take less than one-tenth of a gallon.

The statistical specialists in the House will know that there must be some occasions on some casks, which will be smaller than some that the hon. Member for Banff (Mr. Watt) mentioned, where there is no need to take the full amount as a sample. [Laughter.] Hon. Members think that this is funny. We hear so much about abuse of the social security system costing 0.6 million a year, but every time hon. Members draw attention to tax abuse on a massive scale—whether it is income tax, corporation tax or, as in this case, excise duty on whisky—Opposition Members think that it is funny. They are not prepared to take seriously tax abuse to which the Comptroller and Auditor General has drawn attention. All that the Opposition wish to do is to add to the tax abuse. I accept that they wish to increase public expenditure in the short term. They have come forward with no plans to make sure that all whisky is covered by the duty. There is nothing in the clause or the speech of the hon. Member for Ayr to show that they have even read the Comptroller and Auditor General's report. We have heard nothing about whether they will do anything about this.

The Opposition should have the good grace to comment on the report. [HON. MEMBERS: "Out of order."] If I am out of order, Mr. Godman Irvine, I will take that from you and no one else. I have kept my remarks strictly to the new clause and the amount of public expenditure that flows from it. It is legitimate to seek to know whether it covers all whisky removed from the warehouse. The whisky taken for sampling is dearly removed from the warehouse, duty free.

It is not a matter that hon. Members would discuss each day. It is a difficult matter to raise in the normal course of business. I am extremely grateful that the new clause has been tabled. I, too, look for the SNP new clause and amendment. It seems to me from what you said, Mr. Godman Irvine, that the Tory Party ruled the SNP amendment out of order by choosing to debate only the duty payment on whisky on the Floor, whereas the SNP amendment went much wider.

I do not know the amount of duty on other spirits where there is a tax abuse. The Comptroller and Auditor General's report relates specifically to the whisky industry. He does not differentiate between the Irish whiskey industry and the Scottish whisky industry. I should like to know how the clause affects the Irish position, which has become so important in the passage of the Bill, for legitimate political reasons concerning the Irish Members. I should have thought that they would have something to say on this important matter, as it affects their economy. There is no doubt that this industry is vital to the British economy. I do not wish, in what I have said, to run down the Scotch whisky industry. It is extremely important.

I want to make the point—I think that I have got the message across—that the new clause represents further tax handouts and cuts on top of the existing abuse and tax evasion. Indeed, it is admitted in the Comptroller and Auditor General's report to be illegal. I hope that my right hon Friend will tell us what the Government intend to do about the situation.

Mr. J. Grimond (Orkney and Shetland)

I am sure that many hon. Members are well disposed towards the whisky trade. Some of them may even be thinking of going into the sampling trade after hearing the speech by the hon. Member for Birmingham. Perry Barr (Mr. Rooker). I do not intend to deal with possible abuses. Duty-free shops may be said to be evading duty in a similar way.

We do not often have the opportunity of commenting on this important industry. Therefore, I want to make two serious points. The whisky industry, which is extremely important for the export trade and for many particular localities, is now suffering from a steep increase in costs. The distillery in my constituency suffers chiefly from increases in fuel and transport costs.

We know that the Government have been having conversations with the industry. What proposals have they to meet the legitimate fear of the industry that there will be a continuing decline in distilling—there has already been some decline—and possible threats to the export trade if costs go on rising indefinitely and duty takes up such a high proportion of the price of whisky? I hope that the Government will tell us the results of their conversations with the trade.

Mr. Alick Buchanan-Smith (North Angus and Mearns)

The speeches by the hon. Members for Banff (Mr. Watt) and for Birmingham, Perry Barr (Mr. Rooker) had one thing in common—they both introduced a somewhat ghostly atmosphere into the debate. The hon. Member for Banff asked us to refer to an amendment which does not even appear on the Notice Paper and which we had to conjure up from the figment of our imagination, and the hon. Member for Perry Barr tried to bring to us a different form of departed spirit. It will be interesting to learn from the reply by the Financial Secretary where that spirit has departed to and whether we can bring it back into the Treasury net.

I do not claim to have the same number of distilleries in my constituency as the hon. Member for Banff, but there are six. Cash flow is of major importance, to them.

The right hon. Member for Orkney and Shetland (Mr. Grimond) intervened briefly to raise one important matter. But I think that the Committee would be interested to know whether the Liberal Party supports the new clause. What should appeal to the Liberal Party is that we are trying not merely to seek equity in the treatment of whisky and other alcoholic beverages, but to move towards the harmonisation to which the EEC is also trying to move. It is significant that the EEC is suggesting that excise duty should be paid at the earliest, on the fifteenth and, at the latest, on the twenty-fifth day of the second succeeding month. In other words, the EEC is moving towards the position set out in the new clause. I hope that the Liberal Party will at least be true to its support of the European Economic Community and, in going towards harmonisation, will support the new clause.

Mr. Crawford

There has been a lot of laughter about the new clause, but I point out that at least 20,000 jobs are involved directly in the whisky industry, apart from those not directly involved. As has been said, there is considerable short-time working in the industry.

I am appalled at the cynicism of the Conservative Front Bench in tabling this new clause. The Scottish National Party has constantly sought—

Mr. Buchanan-Smith

The hon. Gentleman is jealous.

Mr. Crawford

I am not jealous. The SNP has constantly sought on Finance Bills, as the Treasury Bench knows, to reduce the duty on whisky. We are very interested in the jobs of our countrymen in this respect. The clause affects the matter but lightly. I understand that the once-for-all cost is £150 million to £160 million over three years.

11.45 p.m.

The Liberal Party view on whisky is worth considering. I understand that when the SNP sought to reduce the duty on whisky during the last two or three Finance Bills the Liberals voted with the Government. I shall gladly give way if any hon. Gentleman wishes to correct me.

Mr. Pardoe

I intervene to tell the hon. Gentleman not that he is wrong but that in the 1950s duty was 78 per cent. of consumer expenditure on whisky, and it is now down to 58 per cent. If one raised the price of a bottle of whisky in real terms to what it was in 1967, the retail price would have to go up by £2.75. I cannot think that the House of Commons has done badly by the whisky industry.

Mr. Hector Monro (Dumfries)

Tell that to the people of Inverness.

Mr. David Steel (Roxburgh, Selkirk and Peebles)

Do not confuse the hon. Member with the facts.

Mr. Crawford

No, do not confuse me with the facts. According to Adam Bergius, who is chairman of the Scotch Whisky Association, in the last financial year, although the duty on whisky has been increased, the amount of revenue from whisky decreased by £20 million. Those are not my figures, but those of the Scotch Whisky Association.

There has been a spot of bother over whisky in the EEC. It was decided there that whisky was not an eau de vie. Whisky derives from the Gaelic uisge beatha. That means eau de vie. In spite of the cynicism of the Conservatives on this issue, we shall support the new clause.

Mr. Dennis Canavan (West Stirlingshire)

The debate has certainly made clear where the priorities of the Tories and the Scottish National Party lie. Last week they voted to give about £445 million to the rich in tax handouts. To-night they are trying to give about £165 million in a tax handout to the whisky magnates. That is where their priorities lie, and I hope that the people of Scotland will note that the Tories will not be alone in the Lobby tonight, but that the SNP apparently wants to help them give this present to the whisky capitalists.

Mr. Watt

Will the hon. Gentleman say how many of his constituents work in the whisky industry?

Mr. Canavan

I shall be coming to that matter later. Perhaps the hon. Member will have a wee bit of patience.

It is also significant that the Tories and SNP Members are trying to give this present to the whisky companies at a time when today's edition of the Glasgow Herald has a headline saying Scotch's strength in profit margins". Among other things, it says: The strong trading position of UK distillers is contrasted with tight margins in importers, shippers and retail chains, together with the reticient growth of UK wine consumption, in a survey by Jordan Dataquest. From a sample of 220 companies throughout the UK, the average profit margin for whisky distillers was 13.9 per cent., for retail chains 0.8 per cent., while wine importers and shippers had an average margin of zero. They seem to be doing not too badly on that evidence concerning their profit margins.

Later, the article says: Top prizes for profits growth, in distilling went to DCL's White Horse, with an increase of 89.4 per cent., last year. Let us now look at some of the pre-tax profits which these companies are making. Distillers Company, for example, in the year ending March 1977, is listed as making a pre-tax profit of £127,690,000.

Mr. Crawford

Just how much of that profit was gained from whisky?

Mr. Canavan

I could not say off-hand but if the hon. Member cares to look into the matter I think that he will find that a substantial amount came from whisky.

Mr. Robert Hughes (Aberdeen, North)

If Distillers is making such vast profits, can it not finance this revenue quite merrily out of profit without coming to the Government and seeking a handout?

Mr. Canavan

I am grateful to my hon. Friend, because it is obvious that Distillers has profits not only from whisky. It also makes excessive profits out of the National Health Service, for example, to an extent which is, to my mind, almost immoral. We have seen some of the activities in which Distillers has been involved concerning drugs, and I think that it leaves a lot to be desired.

Mr. Russell Fairgrieve (Aberdeenshire, West)

As the hon. Member reads out his list of profits, will he please give what the profit is as a percentage of sales?

Mr. Canavan

I could not give that particular figure at this very moment. I am not a walking encyclopaedia. I do not go around with all the figures. But if the hon. Member wants one percentage, the article to which I have referred says: Top prize for profits growth in distilling went to DCL's"— one brand— White Horse, with an increase of 89.4 per cent. last year. What are the companies doing with these profits? It would not be so bad if they were paying their workers decent wages. But I note that the wages bill for Distillers was only £59 million and there are 19,000 workers. By my arithmetic, that means an average wage of about £3,000. Bearing in mind that some of the directors no doubt get more than 10 times that amount, that makes the average wage for the worker in the distillery considerably less than that.

Mr. Younger

Surely it is the Government who have been preventing these companies from giving better wages to their employees.

Mr. Canavan

Perhaps recently that has been so, but certainly over the years when there was an element of free collective bargaining Distillers Company and all the other distillers were significant by the slowness with which they responded to trade union pressure for decent wages.

I maintain that distillers have plenty of money to invest in the industry in order to improve it, to make it more efficient and thereby also to provide more jobs in the industry. They have plenty of opportunity to do that without a tax handout of £165 million. They also have enough left over from their profits to sell a dram at a more moderate price.

The pressure for the new clause does not come from the unions. Trade unionists in my constituency involved in distilling and in the ancillary industries of bottling and capping have made no representations at all asking me to support it. Trade unionists are not dumb. They know fine that this clause of itself would not create one job in Scotland. Nor have I had any representations from consumers, because they know fine the clause will not take 1p or even ½p off the cost of a dram.

It is sheer hypocrisy for the Scottish nationalists and the Tories to claim that they are thinking of the workers or the consumers. They are not: they are thinking of those who are making a profit out of this industry. I challenge them. They knocked a hole in the family budget of £445 million last week. Now they would increase that hole by £165 million. Where will they get the money from? Their priorities are such that if it came to the crunch they would prefer to take the milk from the schoolchildren in order to put money into the pockets of the whisky capitalists.

I urge the House to reject the clause.

Mr. Robert Sheldon

The new clause provides for the phased deferment of excise duty on whisky, in three stages, starting next year. The first difficulty is that it is related to whisky alone. My hon. Friend the Member for Birmingham Perry Barr (Mr. Rooker) mentioned this. He also menioned duty-free samples. The Customs and Excise are at present having discussions with the industry about their use, and I am sure that the House will be notified of any results.

Because the clause is limited to whisky, it discriminates against other spirits, obviously including brandy, imported from other EEC countries. The clause would therefore be in breach of our EEC obligations. But that is not its only weakness. It makes no provision for security of payment. That has been a feature ever since the beginning of excise duties many centuries ago.

Mr. Watt

Is the Minister saying that the whisky industry is less reputable than the beer industry and that the Government are more sure of getting their money from the latter?

Mr. Sheldon

The duty on beer is not collected at the end as it is on whisky and spirits. The method of collection is quite different.

Mr. Watt

Answer.

Mr. Sheldon

I have answered, if the hon. Gentleman was listening. The collection of duty on spirits is at the final product stage. That is not so in the beer industry. He should examine duty collection to see how it is done.

But the main objection, of course, is cost, which is equal to the average duty outstanding at any moment and which has to be financed by Government borrowing. On our 1978–79 estimates of revenue flow, the cost of the new clause for whisky alone would be about £66 million over the three years. Of course, deferment could not apply only to whisky, and, if we included all spirits, the cost for three years would rise to £126 million. There would also be problems over our EEC obligations if we did not include wine. We would then arrive at the total of £165 million mentioned by my hon. Friend the Member for West Stirlingshire (Mr. Canavan).

12 midnight

The hon. Member for Ayr (Mr. Younger) was asked why the last Conservative Government did not permit duty deferment. He said that levels of inflation were not so high then and that therefore the industry's problem was not so severe. But we have introduced stock relief, which has been of enormous value to the whisky industry, as many representions that I have received confirm.

The hon. Member for Ayr was right in saying that there is no technical problem. We have had discussions on these matters and if it becomes possible to allow some period of duty deferment, at least we will have removed the technical problem.

I accept the importance of the whisky industry both for its enormous impact on our export performance and for the jobs it creates, as well as for the unique product that we are fortunate to have manufactured in Scotland.

As the hon. Member for Cornwall, North (Mr. Pardoe) pointed out, there has been a real terms decline in the incidence of duty. The duty on a bottle of spirits today is £.3.70. On the same price base as 10 years ago, it would have been £6.40. There has been a steep decline, in real terms, in the incidence of duty.

That is not the only way in which the Government have helped the industry. Home consumption is expected to rise considerably this year. In 1977–78, 16.6 million proof gallons were produced for home consumption, and that figure is expected to rise to more than 21 million proof gallons this year.

I agree with what the right hon. Member for Orkney and Shetland (Mr. Grimond) said about the importance of the industry, but these production and consumption figures and the figures I have quoted for incidence of the duty show that the burdens imposed on the industry by the Government have been reduced over the last few years.

The burden on the industry of financing the duty depends not only on the level of the duty and the inability or otherwise of the industry to have the duty deferred, but upon the amount of credit that the industry gives to its customers. Distillers and importers of spirits generally give customers considerable commercial credits. The danger is that if there is duty deferment, pressure from retailers for an extension of the period of credit as a result of the distillers receiving a longer period to pay will be severe. That problem has already been recognised.

More than 80 per cent. of the Scotch whisky produced in Scotland is exported. That is a commendable and unique performance. But if we were to introduce duty deferment, it would not help exporters. So the exporters would not get the benefit.

When we look at certain major exporters, particularly in the malt part of the industry, we find that they do not do a great domestic trade. That means that the largest part of the exporting business would not get any benefit from duty deferment. That, together with the fact that wholesalers and retailers would be able to exert pressure upon the distillers, so that much of the benefit would go to them, means that the case for sympathetic consideration is not so great this year.

We came to the conclusion, therefore, that for 1978–79 there could be no duty deferment, with our public sector borrowing requirement at its present level. We are now looking at the prospect for 1979–80 and what we can do to help the industry in improving even further its present performance. But 1979–80 can be dealt with in the Finance Bill of 1979, and there is no need to take action now and try to guess what will be the economic position 12 months or a little less from now.

Mr. Rooker

If that is the case, the Tory Party will be forced to tell us where it is to get the money. Tonight it has sought to avoid answering that question by putting a date limit on the proposal.

Mr. Sheldon

My hon. Friend is quite right. It is the easiest thing in the world to incur debts 12 months from now, and we are likely to see this sort of thing again and again. That is what the Opposition have sought to provide, because they have found that they would be in some difficulty in trying to save money for this current year. They have sought to find an alternative by saying, in effect, "We shall not try to get it this year but will try to get it next year." The danger is that this will not be seen in the context of the economic position at that time and, of course, anything that can be done in this area can be done in the Finance Bill of 1979.

The Budget judgment for next year will obviously have to take account of the important points concerning the industry which have been put forward during the course of the debate. The public sector borrowing requirement is another matter that will obviously be taken into consideration in the judgment.

I do not think that the proposal should be for decision now. I hope that it will be possible to move some way next year, but the final decision must be left until then. I ask the Committee to reject the new clause.

Mr. Younger

I am afraid that that was a most disappointing reply from the Minister. What he has really said is that he accepts the validity of all the arguments but is not prepared to do anything about the mattter this year. I take it that his last words are an undertaking to us that it will be very much on the agenda for next year. But that is not satisfactory from our point of view.

I have explained why the new clause refers only to whisky. We would prefer

to come back possibly at a later stage of the Bill with a proposal which would include spirits as well, if the principle can be accepted.

The hon. Member for West Stirlingshire (Mr. Canavan) indicated that what he really wanted was a lot of whisky companies which made no profits at all. That would, of course, be an absolute recipe for loss of jobs and for disaster for those companies and for the economy as well. The Minister followed that up by saying that one reason that he was doubtful about this was that he would not have security for payment. Does he seriously think that companies in this industry, which are mostly well known, would actually default on payment in this matter? That is a ridiculous concept.

Finally, the Minister suggested that if the proposal were carried out the customers would then require to extend their credit for a similar period from the end of the six or seven weeks that the firm would get from the change. That is a quite ridiculous point of view. It would be totally unlikely to happen and is quite out of keeping with the customs of the trade. It is absolute nonsense, in fact.

The Minister's reply was most disappointing, and in order to reinforce the great importance that we attach to saving jobs in the industry, at a time when unemployment is running at a record rate since the war, I ask my hon. Friends to vote for the new clause.

Question put, That the clause be read a Second time:—

The Committee divided: Ayes 236, Noes 264.

Division No. 212]	AYES	[12.9 a.m.
Adley Robert	Buck, Antony	Durant, Tony
Aitken, Jonathan	Budgen, Nick	Dykes, Hugh
Alison, Michael	Bulmer, Esmond	Edwards, Nicholas (Pembroke)
Arnold, Tom	Burden, F. A.	Elliott, Sir William
Atkins, Rt Hon H. (Spelthorne)	Butler, Adam (Bosworth)	Emery, Peter
Atkinson, David (Bournemouth, East)	Carlisle, Mark	Ewing, Mrs Winifred (Moray)
Bendall, Vivian (Ilford North)	Chalker, Mrs Lynda	Eyre, Reginald
Bennett, Dr Reginald (Fareham)	Churchill, W. S.	Fairbairn, Nicholas
Benyon, W.	Clark, Alan (Plymouth, Sutton)	Fairgrieve, Russell
Berry, Hon Anthony	Clark, William (Croydon S)	Fair, John
Biffen, John	Clarke, Kenneth (Rushcliffe)	Fell, Anthony
Biggs-Davison, John	Clegg, Walter	Finsberg, Geoffrey
Blaker, Peter	Cooke, Robert (Bristol W)	Fisher, Sir Nigel
Body, Richard	Cope, John	Fletcher, Alex (Edinburgh N)
Bowden, A. (Brighton, Kemptown)	Cormack, Patrick	Fookes, Miss Janet
Boyson, Dr Rhodes (Brent)	Costain, A. P.	Forman, Nigel
Braine, Sir Bernard	Crawford, Douglas	Fowler, Norman (Sutton C'f'd)
Brittan, Leon	Crouch, David	Fox, Marcus
Brooke, Peter	Dodsworth, Geoffrey	Fraser, Rt Hon H. (Stafford & St)
Brotherton, Michael	Drayson, Burnaby	Fry, Peter
Bryan, Sir Paul	du Cann, Rt Hon Edward	Galbraith, Hon T. G. D.
Buchanan-Smith, Alick	Dunlop, John	Gardiner, George (Reigate)
Gardner Edward (S Fylde)	Macfarlane, Neil	Rost, Peter (SE Derbyshire)
Gilmour, Sir John (East Fife)	MacGregor, John	Royle, Sir Anthony
Glyn, Dr Alan	MacKay, Andrew (Stechford)	Sainsbury, Tim
Godber, Rt Hon Joseph	Macmillan, Rt Hon M. (Farnham)	St. John-Stevas, Norman
Goodhart, Philip	McNair-Wilson, M. (Newbury)	Scott, Nicholas
Goodlad, Alastair	McNair-Wilson, P. (New Forest)	Scott-Hopkins, James
Gorst, John	Madel, David	Shaw, Giles (Pudsey)
Gow, Ian (Eastbourne)	Marshall, Michael (Arundel)	Shaw, Michael (Scarborough)
Gower, Sir Raymond (Barry)	Marten, Neil	Shelton, William (Streatham)
Grant, Anthony (Harrow C)	Mates, Michael	Shepherd, Colin
Gray, Hamish	Mather, Carol	Shersby, Michael
Grist, Ian	Maude, Angus	Silvester, Fred
Hall-Davis, A. G. F.	Mawby, Ray	Sims, Roger
Hamilton, Archibald (Epsom & Ewell)	Maxwell-Hyslop, Robin	Sinclair, Sir George
Hamilton, Michael (Salisbury)	Mayhew, Patrick	Skeet, T. H. H.
Hampson, Dr Keith	Meyer, Sir Anthony	Smith, Timothy John (Ashfield)
Hannam, John	Miller, Hal (Bromsgrove)	Speed, Keith
Harrison, Col Sir Harwood (Eye)	Mills, Peter	Spence, John
Harvie Anderson, Rt Hon Miss	Miscampbell, Norman	Spicer, Jim (W Dorset)
Haselhurst, Alan	Mitchell, David (Basingstoke)	Spicer, Michael (S Worcester)
Havers, Rt Hon Sir Michael	Moate, Roger	Sproat, Iain
Hayhoe, Barney	Monro, Hector	Stainton, Keith
Henderson, Douglas	Montgomery, Fergus	Stanbrook, Ivor
Hicks, Robert	Moore, John (Croydon C)	Stanley, John
Hodgson, Robin	More, Jasper (Ludlow)	Steen, Anthony (Wavertree)
Holland, Philip	Morgan-Giles, Rear-Admiral	Stewart, Rt Hon Donald
Hordern, Peter	Morris, Michael (Northampton S)	Stewart, Ian (Hitchin)
Howe, Rt Hon Sir Geoffrey	Morrison, Charles (Devizes)	Stokes, John
Howell, David (Guildford)	Morrison, Hon Peter (Chester)	Stradling Thomas, J.
Hunt, David (Wirral)	Mudd, David	Tapsell, Peter
Hunt, John (Ravensbourne)	Neave, Airey	Taylor, Teddy (Cathcart)
Hurd, Douglas	Nelson, Anthony	Tebbit, Norman
Hutchison, Michael Clark	Neubert, Michael	Temple-Morris, Peter
Irving, Charles (Cheltenham)	Newton, Tony	Thompson, George
James, David	Nott, John	Townsend, Cyril D.
Jenkin, Rt Hon P. (Wanst'd & W'df'd)	Onslow, Cranley	Trotter, Neville
Johnson Smith, G. (E Grinstead)	Oppenheim, Mrs Sally	van Straubenzee, W. R.
Jones, Arthur (Daventry)	Osborn, John	Vaughan, Dr Gerard
Jopling, Michael	Page, Rt Hon R. Graham (Crosby)	Viggers, Peter
Joseph, Rt Hon Sir Keith	Page, Richard (Workington)	Wakeham, John
Kershaw, Anthony	Pattie, Geoffrey	Walder, David (Clitheroe)
King, Evelyn (South Dorset)	Percival, Ian	Walker, Rt Hon P. (Worcester)
King, Tom (Bridgwater)	Pink, R. Bonner	Walker-Smith, Rt Hon Sir Derek
Kitson, Sir Timothy	Prentice, Rt Hon Reg	Wall, Patrick
Knight, Mrs Jill	Price, David (Eastleigh)	Watt, Hamish
Knox, David	Prior, Rt Hon James	Weatherill, Bernard
Lamont, Norman	Raison, Timothy	Wells, John
Langford-Holt, Sir John	Rathbone, Tim	Welsh, Andrew
Latham, Michael (Melton)	Rees, Peter (Dover & Deal)	Whitney, Raymond (Wycombe)
Lawson, Nigel	Reid, George	Wiggin, Jerry
Lester, Jim (Beeston)	Renton, Rt Hon Sir D. (Hunts)	Winterton, Nicholas
Lewis, Kenneth (Rutland)	Renton, Tim (Mid-Sussex)	Wood, Rt Hon Richard
Lloyd, Ian	Rhodes, James R.	Young, Sir G. (Ealing, Acton)
Loveridge, John	Ridley, Hon Nicholas	Younger, Hon George
Luce, Richard	Ridsdale, Julian
McAdden, Sir Stephen	Roberts, Michael (Cardiff NW)	TELLERS FOR THE AYES:
MacCormick, Iain	Roberts, Wyn (Conway)	Mr. Spencer Le Marchant and
McCrindle, Robert	Rossi, Hugh (Hornsey)	Lord James Douglas-Hamilton.
NOES
Abse, Leo	Brown, Hugh D. Provan)	Crowther, Stan (Rotherham)
Allaun, Frank	Brown, Robert C. (Newcastle W)	Cryer, Bob
Anderson, Donald	Brown, Ronald (Hackney S)	Cunningham, Dr J. (Whiteh)
Archer, Rt Hon Peter	Buchan, Norman	Dalyell, Tam
Armstrong, Ernest	Buchanan, Richard	Davidson, Arthur
Ashton, Joe	Callaghan, Jim (Middleton & P)	Davies, Rt Hon Denzil
Atkins, Ronald (Preston N)	Campbell, Ian	Davies, Ifor (Gower)
Atkinson, Norman	Canavan, Dennis	Davis, Clinton (Hackney C)
Barnett, Guy (Greenwich)	Cant, R. B.	Deakins, Eric
Barnett, Rt Hon Joel (Heywood)	Carmichael, Neil	Dean, Joseph (Leeds West)
Bates, Alf	Carter, Ray	de Freitas, Rt Hon Sir Geoffrey
Bean, R. E.	Carter-Jones, Lewis	Dell, Rt Hon Edmund
Beith, A. J.	Cartwright, John	Dempsey, James
Bennett, Andrew (Stockport N)	Castle, Rt Hon Barbara	Dewar, Donald
Bidwell, Sydney	Clemitson, Ivor	Doig, Peter
Bishop, Rt Hon Edward	Cocks, Rt Hon Michael (Bristol S)	Dormand, J. D.
Blenkinsop, Arthur	Cohen, Stanley	Douglas-Mann, Bruce
Boardman, H.	Coleman, Donald	Dunnett, Jack
Booth, Rt Hon Albert	Conlan, Bernard	Eadie, Alex
Boothroyd, Miss Betty	Corbett, Robin	Edge, Geoff
Bottomley, Rt Hon Arthur	Cowans, Harry	Ellis, John (Brigg & Scun)
Boyden, James (Bish Auck)	Cox, Thomas (Tooting)	English, Michael
Bradley, Tom	Crawshaw, Richard	Ennals, Rt Hon David
Bray, Dr Jeremy	Cronin, John	Evans, Fred (Caerphilly)

Evans, Ioan (Aberdare)	Leadbitter, Ted	Rooker, J. W.
Evans, John (Newton)	Lestor, Miss Joan (Eton & Slough)	Roper, John
Ewing, Harry (Stirling)	Lever, Rt Hon Harold	Rose, Paul B.
Fernyhough, Rt Hon E.	Lewis, Ron (Carlisle)	Ross, Stephen (Isle of Wight)
Fitch, Alan (Wigan)	Litterick, Tom	Ross, Rt Hon W. (Kilmarnock)
Fitt, Gerard (Belfast W)	Lomas, Kenneth	Rowlands, Ted
Flannery, Martin	Loyden, Eddie	Ryman, John
Fletcher, Ted (Darlington)	Lyon, Alexander (York)	Sandelson, Neville
Foot, Rt Hon Michael	Lyons, Edward (Bradford W)	Sedgemore, Brian
Ford, Ben	McCartney, Hugh	Selby, Harry
Forrester, John	McDonald, Dr Oonagh	Sever, John
Fowler, Gerald (The wrekin)	McElhone, Frank	Shaw, Arnold (Ilford South)
Fraser, John (Lambeth, N'w'd)	MacFarquhar, Roderick	Sheldon, Rt Hon Robert
Freeson, Rt Hon Reginald	MacKenzie, Rt Hon Gregor	Shore, Rt Hon Peter
Freud, Clement	Mackintosh, John P.	Silkin, Rt Hon John (Deptford)
Garrett, John (Norwich S)	Maclennan, Robert	Silkin, Rt Hon S. C. (Dulwich)
Garrett, W. E. (Wallsend)	Madden, Max	Silverman, Julius
George, Bruce	Magee, Bryan	Skinner, Dennis
Gilbert, Rt Hon Dr John	Mahon, Simon	Smith, John (N Lanarkshire)
Ginsburg, David	Mallalieu, J. P. W.	Snape, Peter
Golding, John	Marks, Kenneth	Spearing, Nigel
Gould, Bryan	Marshall, Dr Edmund (Goole)	Spriggs, Leslie
Gourlay, Harry	Marshall, Jim (Leicester S)	Stallard, A. W.
Grant, George (Morpeth)	Mason, Rt Hon Roy	Steel, Rt Hon David
Grant, John (Islington C)	Maynard, Miss Joan	Stewart, Rt Hon M. (Fulham)
Grocott, Bruce	Meacher, Michael	Stoddart, David
Hamilton, W. W. (Central Fife)	Mendelson, John	Stott, Roger
Hardy, Peter	Mikardo, Ian	Strang, Gavin
Harper, Joseph	Millan, Rt Hon Bruce	Summerskill, Hon Dr Shirley
Harrison, Rt Hon Walter	Miller, Dr M. S. (E Kilbride)	Swain, Thomas
Hart, Rt Hon Judith	Mitchell, Austin	Taylor, Mrs Ann (Bolton W)
Hattersley, Rt Hon Roy	Mitchell, R. C. (Soton, Itchen)	Thomas, Dafydd (Merioneth)
Hayman, Mrs Helene	Moonman, Eric	Thomas, Jeffrey (Abertillery)
Healey, Rt Hon Denis	Morris, Alfred (Wythenshawe)	Thomas, Mike (Newcastle E)
Heffer, Eric S.	Morris, Rt Hon Charles R.	Thomas, Ron (Bristol NW)
Horam, John	Morris, Rt Hon J. (Aberavon)	Thorne, Stan (Preston S)
Howell, Rt Hon Denis (B'ham, Sm H)	Moyle, Roland	Tierney, Sydney
Hoyle, Doug (Nelson)	Murray, Rt Hon Ronald King	Tilley, John (Lambeth, Central)
Huckfield, Les	Newens, Stanley	Tinn, James
Hughes, Rt Hon C. (Anglesey)	Noble, Mike	Tomlinson, John
Hughes, Mark (Durham)	Oakes, Gordon	Torney, Tom
Hughes, Robert (Aberdeen N)	Ogden, Eric	Varley, Rt Hon Eric G.
Hughes, Roy (Newport)	O'Halloran, Michael	Wainwright, Edwin (Dearne V)
Hunter, Adam	Orme, Rt Hon Stanley	Walker, Harold (Doncaster)
Irving, Rt Hon S. (Dartford)	Ovenden, John	Walker, Terry (Kingswood)
Jackson, Colin (Brighouse)	Owen, Rt Hon Dr David	Ward, Michael
Jackson, Miss Margaret (Lincoln)	Palmer, Arthur	Watkins, David
Janner, Greville	Pardoe, John	Wellbeloved, James
Jay, Rt Hon Douglas	Park, George	White, Frank R. (Bury)
Jeger, Mrs Lena	Parker, John	White, James (Pollock)
Jenkins, Hugh (Putney)	Parry, Robert	Whitehead, Philip
John, Brynmor	Pavitt, Laurie	Whitlock, William
Johnson, Walter (Derby S)	Pendry, Tom	Williams, Alan Lee (Hornch'ch)
Johnston, Russell (Inverness)	Penhaligon, David	Williams, Rt Hon Shirley (Hertford)
Jones, Alec (Rhondda)	Price, C. (Lewisham W)	Wilson, Rt Hon Sir Harold (Huyton)
Jones, Barry (East Flint)	Price, William (Rugby)	Wilson, William (Coventry SE)
Jones, Dan (Burnley)	Radice, Giles	Wise, Mrs Audrey
Kaufman, Gerald	Rees, Rt Hon Merlyn (Leeds S)	Woodall, Alec
Kelley, Richard	Richardson, Miss Jo	Woof, Robert
Kerr, Russell	Roberts, Albert (Normanton)	Wrigglesworth, Ian
Kilroy-Silk, Robert	Roberts, Gwilym (Cannock)	Young, David (Bolton E)
Kinnock, Neil	Robinson, Geoffrey
Lambie, David	Roderick, Caerwyn	TELLERS FOR THE NOES:
Lamborn, Harry	Rodgers, George (Chorley)	Mr. James Hamilton and
Lamond, James	Rodgers, Rt Hon William (Stockton)	Mr. Ted Graham.
Latham, Arthur (Paddington)

Question accordingly negatived.

Bill (Clause 11) reported, with amendments to lie upon the Table.