Commons Sitting of 3 December 1979

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
ORAL ANSWERS TO QUESTIONS
  ORAL ANSWERS TO QUESTIONS
  Mr. Speaker: I appeal to hon. Members who are called for a supplementary question to limit themselves to one question. That will enable us to reach more questions on the Order Paper.
  ORAL ANSWERS TO QUESTIONS
    WALES

      Trunk Roads
      Mr. Hoosonasked the Secretary of State for Wales whether he is satisfied with the rate of progress in constructing trunk roads in Wales.
      The Under-Secretary of State for Wales (Mr. Michael Roberts): I am satisfied that work in hand on trunk road schemes is being carried out as quickly as possible.
      Mr. Hooson: Although my right hon. Friend has rightly attached the highest spending priority to trunk roads as the
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      basis for a stronger Welsh economy, will he promote plans for further extensions of that network to ensure that plans are ready for future implementation?
      Mr. Roberts: Details of the future trunk road programme will be announced following the publication of the Government's public expenditure plans for the next five-year period. There is no shortage of proposals for roads, but they are often delayed because of statutory procedures and the process of preparation. I shall do all that I can to ensure that there are sufficient proposals to match the speed of those procedures and the resources available.
      Mr. Alec Jones: I agree that there is no shortage of proposals, but is there likely to be a shortage of public money to carryout such proposals, since there is to be a cut in public expenditure on roads and transport of about £11 million?
      Mr. Roberts: We will stick to our programme for road development in Wales, though with great difficulty, and it is our policy to give that development the highest priority. I expect reductions to fall mainly on smaller schemes, selected according to progress on statutory procedures and contractual arrangements.

      Welsh Language Education
      Mr. Wigleyasked the Secretary of State for Wales if he will arrange to discuss with each of the eight local education authorities in Wales the impact that

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      Government policies are having on Welsh language education.
      Mr. Michael Roberts: No. My right hon. Friend and I have already discussed the educational implications of our policy, including the question of specific grant for bilingual education, with representatives of the Welsh Joint Education Committee.
      Mr. Wigley: Will the Under-Secretary accept that the Government's policy on bussing children to school could have a serious adverse effect on those areas with centralised bilingual, or Welsh language, primary and secondary schools, which attract children from large catchment areas? In his negotiations, will the Under-Secretary ensure that no local authority cuts back on transport to those schools, because that could kill them off?
      Mr. Roberts: We are aware of the special transport problems for both denominational and bilingual schools. However, the transport subsidy on school buses will remain very substantial. I note, with a modicum of satisfaction, that Gwynedd county council has informed the Welsh Office that it considers the latest rate support grant settlement to be fair.

      Factory Units
      Mr. Knoxasked the Secretary of State for Wales how many new factory units have been built by the Welsh Development Agency since its inception.
      The Secretary of State for Wales (Mr. Nicholas Edwards): Two hundred and twenty-seven, with a total floor area of 1·6 million sq ft.
      Mr. Knox: Will my right hon. Friend confirm that the great majority of those factory units have been occupied or allocated? Will he also confirm that those that have not yet been allocated will shortly be so? Does he agree that this makes a real contribution to industrial expansion in Wales?
      Mr. Edwards: I agree with my hon. Friend. A high proportion of those units have been taken up by small companies and newly established companies. The Welsh Development Agency will continue to give that sort of priority.
      Mr. Roy Hughes: Does the Secretary of State agree that the need for the
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      Welsh Development Agency will become greater in the future? Has anyone told him about the proposal to make over 6,000 people redundant at the Llanwern steelworks? Does he appreciate that that will put Newport and the surrounding areas back to the 1930s in terms of unemployment? Has he any contingency plans in his locker to turn that area into a special development area?
      Mr. Edwards: I do not doubt that the WDA will have a great deal of work to do, but it is absurd to talk about specific proposals for a particular area before the British Steel Corporation has made any final plans for that area.
      Sir Anthony Meyer: Is my right hon. Friend aware that the shortage of advance factory space could prove a bottleneck in dealing with the problems arising out of unemployment in the Deeside area? Will he give urgent attention to that matter?
      Mr. Edwards: I am visiting Deeside on Wednesday to discuss with the local authorities and those involved the plans for advance factory building and other measures around the Shotton area. I assure my hon. Friend that I am well aware of the need for a major programme, and I am already discussing with the WDA the details of that programme.
      Mr. Rowlands: Is it not sheer industrial and economic madness, given the thousands of job losses that are at least pending, possibly in steel and coal, as well as the general level of unemployment, which will rise in 1980, for the Secretary of State to cut investment grants to the WDA and to remove grants from special development areas in South Wales? Will he consider suspending those cuts in light of the terrible dangers facing the Welsh economy and the serious prospects for unemployment in Wales?
      Mr. Edwards: I notice that the hon. Gentleman is once again advocating higher public expenditure without telling the House how he proposes to finance it. No doubt he will also criticise the Government for high interest rates. He must recognise that the two go together.
      I have already told the House that I attach great importance to the work of the WDA, and I believe that there is great potential for using its substantial

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      existing assets far more widely than hitherto.

      Interest Rates
      Mr. Bestaskedthe Secretary of State for Wales what assistance can be given to farmers and others in Wales in times of the present high interest rates.
      Mr. Nicholas Edwards: Sources of assistance to farmers include capital grants under the farm and horticulture development scheme and the farm and horticulture capital grants schemes, together with loan facilities available through the Agricultural Mortgage Corporation and the Agricultural Credit Corporation.
      Mr. Best: While welcoming my right hon. Friend's explanation and accepting that the present high interest rates are an integral part of the Government's strategy for economic recovery, may I ask whether my right hon. Friend is aware that French farmers are heavily subsidised by their Government and that they are put in a position of unfair competition with our farmers?
      Mr. Edwards: I agree that French farmers are heavily subsidised, but Governments and the farming industry in this country have long preferred our method of assistance, namely, the substantial contributions towards the cost of capital investment which we provide under the schemes that I have described. My hon. Friend should be aware of the scale of support that we give our farmers in that way.
      Mr. Denzil Davies: Will the Secretary of State explain to his hon. Friend the Member for Anglesey (Mr. Best) that the Tory Party fought the last election on cuts in public expenditure and that the hon. Gentleman cannot now call for more public money to protect certain groups from the disastrous consequences of the Government's economic policy?
      Mr. Edwards: My hon. Friend the Member for Anglesey (Mr. Best) was pointing to the problems of high interest rates which arise from the excessive public expenditure unleashed by the right hon. Member for Llanelli (Mr. Davies) when he had responsibility in the Treasury. I hope that the right hon. Gentleman takes responsibility for the consequences that we are suffering.
      Mr. Alan Williams: Is it not a fact that by delaying regional grant payments in one Budget the Government forced business men to borrow money, and by action in a subsequent Budget made it cripplingly expensive for them to do so? Where in the Conservative manifesto could any business man or householder who voted Tory last time have anticipated that the Government would force interest rates above the rates that Conservatives described as "usury" when they were in opposition? Finally, what comfort can this Shylock Government offer to business men whose businesses are bleeding to death as cuts reduce orders, real profits fall to the lowest level ever and interest rates soar to the highest level ever?
      Mr. Edwards: No doubt that, Mr. Speaker, is the one question that you suggested should be asked. The language used by the right hon. Member for Swansea, West (Mr. Williams) could be covered by the phrase of the right hon. Member for Leeds, East (Mr. Healey) when he was Chancellor of the Exchequer. When faced with similar criticisms of high interest rates, the right hon. Gentleman said that the criticisms grossly exaggerated the effect of changes in interest rates on the real economy. That is absolutely right. The criticisms come ill from a former Minister who was involved in the overnight abolition of the regional employment premium, without any compensation for the economy. I remind the right hon. Gentleman that the CBI is pressing us to go on with the policies that we are following.

      Contraception (Depo Provera)
      Mr. Colemanasked the Secretary of State for Wales what representations he has received about the use of the Depo Provera contraceptive injection amongst Welsh women; and whether this form of contraception is being used in Wales.
      The Under-Secretary of State for Wales (Mr. Wyn Roberts): I have not received any representations about the use of Depo Provera. This drug is in use in Wales as a contraceptive.
      Mr. Coleman: Is the hon. Gentleman aware of the anxiety among women's organisations in Wales over the side effects, including acute depression, that are reported to be experienced by those for whom the drug has been prescribed?

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      Will he issue instructions that the drug should not be used on women in Wales unless the fullest explanation has been given, and that it should certainly not be used on unmarried women?
      Mr. Roberts: I am not aware of the deep concern to which the hon. Gentleman has referred. Depo Provera is currently licensed for use only as a short-term contraceptive in special circumstances; for example, where a husband has undergone a vasectomy or where a woman has been injected against rubella and the virus is still active. I am advised that the drug is well tolerated and that no significant untoward effects have been reported.
      Dr. Roger Thomas: Would it not be better for the time being, as we do not know the long-term effects of the injection, if Depo Provera were used only under the strict supervision of obstetric and gynaecological departments of our district hospitals?
      Mr. Roberts: We have always taken the view, as the hon. Gentleman will know, that in the National Health Service doctors should be free to exercise their clinical judgment. The drug may therefore be prescribed where individual circumstances so indicate. I should not like to limit clinical judgment in any way.

      Interest Rates
      Sir Raymond Gowerasked the Secretary of State for Wales what special attention he will give to the problems of the small companies and firms in Wales during the continuance of high interest rates; and if he will make a statement.
      Mr. Nicholas Edwards: My Department and the agencies for which I am responsible recognise the important role of small firms in the economy and will do all we can to help them. High interest rates for a period are unavoidable if we are to succeed in controlling inflation, which is essential to a successful future for our small businesses.
      Sir R. Gower: Is my right hon. Friend aware that among the companies that have approached me recently there are many that recognise the paramount importance of containing inflation? However, will he bear in mind that many
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      small firms have had a decade or more of difficult conditions and have not been able to acquire great reserves and are therefore peculiarly dependent upon overdrafts and other forms of borrowing?
      Mr. Edwards: I am sure that my hon. Friend is right, but it is a prime requirement that we defeat inflation. No one will suffer more disastrously from continuing inflation than the small business sector. We have taken, and are taking, a number of measures to help that sector. The Budget was an important first step in that programme, which will include many important measures to revitalise the small firms sector and to remove the unnecessary obstacles to their success.
      Mr. Ioan Evans: Does the right hon. Gentleman agree that the increase in MLR from 12 per cent. to 17 per cent. was partially due to the Budget, which gave tremendous concessions to the wealthy? Will he consider restoring the regional development grants to Wales, because their absence is hitting small businesses? Will the right hon. Gentleman also consider the provision of small factories in the advance factory programme that we expect him to announce shortly?
      Mr. Edwards: I notice that the hon. Gentleman is again advocating higher public expenditure. The high level of that expenditure is the reason for present high interest rates. I have already told the hon. Gentleman that more than 90 per cent. of the advance factories being built by the WDA are being constructed for the small business sector.
      Mr. Wigley: Does the right hon. Gentleman accept that high interest rates have an adverse effect on the liquidity of small companies? Will he consider not lengthening the waiting period for payment of industrial development grants to companies that have already been given approval of grants and have gone ahead with investment programmes on the assumption of lower interest rates, but are now being caught in a trap because of the liquidity problem?
      Mr. Edwards: If any individual company is faced with a particular problem we shall look at the circumstances to see whether we can help, and the Welsh Development Agency will do likewise.
      Mr. Anderson: Since the Conservatives, in their election manifesto, posed as the friends of small business men, and since they rely on the notion of mandate, can the Secretary of State say where in the Conservative manifesto there is a mandate for the current high interest rates?
      Mr. Edwards: The policy for which we sought a mandate was to restore the economy and to defeat inflation. We always said that the defeat of inflation was our first and most immediate priority. The previous Government inreased expenditure in an effort to win the general election, and they left us with a rapidly rising rate of inflation. We are now suffering the consequences, and we shall take determined action to defeat inflation.

      A55
      Sir Anthony Meyerasked the Secretary of State for Wales what is the present target date for the completion of a dual track road from the English border to Bangor along the line of the A55.
      Mr. Michael Roberts: Subject to the satisfactory completion of statutory procedures, I hope that the dualling of the A55 will be completed by about 1987–88.
      Sir A. Meyer: Can my hon. Friend assure us that, despite economic difficulties, this programme will not be allowed to slip? Will he agree that proposals to simplify the statutory procedures might make it easier to keep the programme up to date?
      Mr. Roberts: The planned level of expenditure for 1980–81 will enable work to go ahead on those schemes of the A55 which are expected to be ready in that year—the Hawarden bypass and phase I of the Colcon scheme. Expenditure levels for subsequent years will be announced in due course, but we have made it clear that priority will be given to the dualling of the A55.

      Expenditure
      Mr. loan Evansasked the Secretary of State for Wales what representation he has received from local authorities in Wales regarding cuts in governmental grants for development areas, cuts in local authority expenditure during the current
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      financial year and proposed further cut for the next financial year.
      Mr. Nicholas Edwards: Four local authorities, Cardiff city council, Clwyd county council, Cynon Valley borough council and Dwyfor district council, have made general representations about reduction in local authority expenditure, and others have written about the possible effect on specific services in individual areas. Five counties and 13 districts have commented on the changes in regional policy.
      Mr. Evans: Is the Secretary of State aware that there is deep concern in local government circles about the Govment's policy? What effect does he think these cuts will have on local authority rates? Will he tell the people of Wales that they should not blame their borough councillors and their county councillors, but that they must look to the Government who are primarily responsible for the cuts that will come about in social services?
      Mr. Edwards: I hope that the hon. Member will not exaggerate the effect on local government of a cut of 2½ per cent. over two years, or argue that that is a justifiable reason for substantial rate increases. I do not believe that that is so.
      Mr. Alec Jones: Does not the Secretary of State realise that the representations that he listed to the House show the real concern of these local authorities, not only for their services, but for the prospects of industrial development in Wales? Will he now come clean and give his estimate of the number of people likely to be unemployed as a consequence of the cuts? When I gave a figure of 110,000 in the Welsh Grand Committee was I too high, too low, or just about right?
      Mr. Edwards: I amsure that the right hon. Member will agree that the difficulties we now face make it absolutely right for us to concentrate industrial help on those areas with the greatest problems. I have no intention of giving unemployment forecasts because I do not believe in forecasts of that kind. I well recall that when the previous Government put up their interest rates to a then record level, unemployment fell. These things are difficult to foresee. I told the House of Commons in my first speech from this

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      Dispatch Box that we had inherited a rising trend of unemployment. I do not disguise the fact that I expect unemployment in Wales to rise.
      Mr. Best: Does not my right hon. Friend find it rather strange that there is so much furore over modest reductions which leave overall public expenditure, in real terms, more or less what it was last year? Is it not a fact that the cuts that were introduced by the previous Government were effectively far more stringent, yet we heard no criticism then?
      Mr. Edwards: My hon. Friend is quite right. The previous Government cut local government expenditure by 2½ per cent. in a single year. Now they are complaining because we propose a similar level of reduction over a two-year period.
      Mr. Alec Jones: If the Chief Secretary to the Treasury can indicate in the Government's White Paper that he expects unemployment to rise by 300,000 next year, why cannot the Secretary of State for Wales tell us how many people will be unemployed in Wales?
      Mr. Edwards: The Chief Secretary has done nothing of the kind. He has done what his predecessors have done—he has made an assumption for the purposes of calculating social security benefits. The right hon. Gentleman presumably has the mathematical skills to make some kind of calculation based on that, but it would not be a forecast.

      Teddington Bellows Limited, Pontardulais
      Mr. Ifor Davies: asked the Secretary of State for Wales, what progress is being made with the application of Teddington Bellows Ltd., Pontardulais, for a large extension in the form of an advanced factory to its existing factory; and if he will make a statement.
      Mr. Nicholas Edwards: The factory extension is a matter for the Welsh Development Agency, but I understand that good progress is being made. I welcome the expansion plans and am pleased that my industry department's offer of financial support under section 7
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      of the Industry Act has been accepted by the company.
      Mr. Davies: I thank the Minister for that reply. Is he aware that, in the light of the situation at Port Talbot, the Lliw Valley and the Swansea Valley are in urgent need of industrial development? Having regard to the wider repercussions of the British Steel Corporation's position at Port Talbot on the whole of West Glamorgan, will the Secretary of State immediately support redesignation of West Glamorgan as a special development district?
      Mr. Edwards: The BSC indicated the present extent of its crisis to the Government only last Wednesday and it is much too early for us to come to any conclusion on what we have now been told. I have said repeatedly in this House that one of the advantages of the structure of regional assistance is that we have a consistent pattern on which development areas are based and if the situation changes we have the flexibility to respond to the new facts that arise.
      Mr. Alan Williams: Is it not absurd that, at a time when we are all desperate to obtain new jobs and new industry in Wales, the Welsh Development Agency has deliberately delayed the expansion programme of a different company on the Fforest Fach estate in Swansea and has also refused a third extra unit to that company in its Llandovery operation where it would have created 13 much-needed jobs?
      Mr. Edwards: If the right hon. Gentleman will table a question on that point about the Welsh Development Agency, I shall see that he gets an answer.

      Employment
      Mr. Barry Jonesasked the Secretary of State for Wales what representations he has received from the Alyn-Deeside district council concerning measures to aid employment subsequent to the closure of the steelmaking plant at Shotton.
      Mr. Nicholas Edwards: I have received written representations on four occasions from the council. I met representatives on 1 August 1979 and will be meeting them again when I visit Deeside later this week.
      Mr. Jones: Is it not a fact that it has been estimated that £1½ million in rate income will be lost next year when steelmaking closes at Shotton? Is it not also a fact that the Alyn-Deeside council will lose £250,000and this is generating widespread resentment because there is no guarantee of a compensatory grant? Can the Secretary of State tell us whether he will, as requested, set up a task force led by a Government Minister to supervise the steel rescue measures? Will he agree that a £15 million river road in the area of the Deeside constituency would help to bring new jobs to the area and stave off further unemployment?
      Mr. Edwards: I told the hon. Member when he last raised this point that I felt that the first priority of Government expenditure was to provide infrastructure and new factories. I am aware of the representations that have been made about the rate loss, which is recovered after a year or so. I shall listen most carefully to the points put to me by the local authorities on Wednesday about whatever form of monitoring and supervision seems most suitable for the area. I do not believe that a formal task force is the best answer but I have an open mind to those representations and I shall listen carefully. I note what the hon. Member says about the road. I hope that he will accept that the road schemes already announced for the area, including the scheme announced by the Ministry of Transport only last week, represent a substantial improvement in communications to Deeside.

      Interest Rates
      Mr. Denzil Daviesasked the Secretary of State for Wales what calculations he has made of the effect of the recent increase in the minimum lending rate on employment prospects in Wales.
      Mr. Nicholas Edwards: I do not believe that meaningful estimates of this kind can be made.
      Mr. Davies: The right hon. Gentleman is understandably coy about giving unemployment forecasts for Wales. Is he not aware that the Government's policy of high inflation and high interest rates will put thousands of people in Wales on the dole and that it makes a mockery of the Conservative Party's claim to be the party of small business? Will he
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      now assure the House that he will not be party to any further increase in interest rates?
      Mr. Edwards: It is remarkable that a former Treasury Minister who repeatedly refused to give forecasts of that kind should ask me to do so. It is equally remarkable that charges about high inflation should come from the Treasury Ministers who created the present situation We shall continue the fight against the high inflation that we inherited from the previous Government, even if in the short term it means high interest rates.
      Sir Raymond Gower: Will my right hon. Friend bear in mind that whenever the previous Labour Government made elaborate forecasts about an improvement in the economy they were invariably followed by a marked deterioration?
      Mr. Edwards: I have always had a good deal of scepticism about forecasts of that kind. We always remember the unending succession of forecasts from my predecessor, who week after week and month after month told us that the economy in Wales was being transformed, yet week after week and month after month under the previous Administration unemployment in Wales went up.
      Mr. Barry Jones: With regard to unemployment and the apparent further uncertainties in the steel industry, can the right hon. Gentleman give a guarantee that the remaining jobs at BSC Shotton—about 4,500–will be saved? Will he guard these remaining steel jobs like a tigress guards her cubs?
      Mr. Edwards: Eventually, and in the long term, jobs in any industry depend upon the ability to market goods. I know of no proposals that affect the jobs to which the hon. Gentleman referred.
      Sir Anthony Meyer: Is my right hon. Friend aware of any suggestion from the Opposition on how to combat inflation, or of any advice from any Labour Member to the unions not to press inflationary wage claims?
      Mr. Edwards: I entirely agree with what my hon. Friend says.

      School Transport
      Mr. Roy Hughesasked the Secretary of State for Wales how many representations he has received concerning the

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      decision to cut back on free school transport; what reply he has sent; and if he will make a statement.
      Mr. Michael Roberts: Threepetitions and 31 letters. In reply I have explained our view that savings in expenditure should, as far as possible, be secured in areas not directly related to teaching in the classroom.
      Mr. Hughes: Are not the basic points to be appreciated that the catchment area for Roman Catholic schools is far larger than that for the normal local education authority school and that it is the less well off parents who will feel the pinch of these increased costs? Will the hon. Gentleman prevail upon his right hon. and learned Friend the Secretary of State for Education and Science to delete this provision from the Education (No. 2) Bill, because such action would win the warmhearted approval of hon. Members on both sides of the House?
      Mr. Roberts: We are not singling out denominational schools. There is, of course, no statutory requirement in the Education Act 1944 for authorities to provide free transport for children attending denominational or bilingual schools, unless there is no nearer suitable school. What the local authorities now do for these schools they do at their discretion, and that discretion will remain. As I pointed out earlier, the amount of subsidy for school transport will remain substantial. As to less well off parents, under the proposed legislation authorities will still be obliged to provide free transport for children from families in receipt of supplementary benefit and family income supplement.
      Mr. Alec Jones: Does not the hon. Gentleman recall that one of the slogans under which the Conservative Party fought the election was that of increasing freedom of choice? This reduction in free school transport severely restricts the freedom of choice for many parents whose children attend Welsh language, Catholic and Church in Wales schools. It is all very well for the hon. Gentleman to say that the discretion will remain, but he knows that it is a meaningless discretion in that local authorities will not have the money to exercise that discretion.
      Mr. Roberts: It is not a meaningless discretion. I hope that the right hon.
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      Gentleman will make representations to local authorities if he feels that they are not exercising their discretion in a reasonable way. Of course we still stand by choice for parents and their children, but this must be with due regard to the public purse.
      Sir Raymond Gower: While accepting a good deal of what my hon. Friend has said, will he note the valid point made on this occasion by the hon. Member for Newport (Mr. Hughes), namely, that the catchment areas, particularly of the Roman Catholic community, are extraordinarily large? To that extent, would it be helpful if local authorities were asked, either in the form of a circular or something of that nature, to bear in mind the size of the necessary catchment area in any particular case?
      Mr. Roberts: I always notice any valid point made by the hon. Member from Newport (Mr. Hughes). I accept that the catchment areas for Roman Catholic schools are indeed extensive. The local authorities have recognised that by the discretion that they have shown in the past. I am certain that during further discussion on the Education (No. 2) Bill this matter will be given further consideration.

      School Building (Dyfed)
      Dr. Roger Thomasasked the Secretary of State for Wales what effect his proposed reduction in the schools' capital building programme in Dyfed will have on the replacement of Victorian primary schools.
      Mr. Michael Roberts: That will depend on what schemes the authority undertakes within its allocation.
      Dr. Thomas: I speak as a member of an education committee that covers one-quarter of the surface area of Wales. Does the Minister realise the chaos into which he puts the plans of any education committee, particularly an education committee in South-West Wales that has a huge burden facing it with regard to a particular school in the South-West of the county?
      Mr. Roberts: There are 123 pre-1903 primary schools in Dyfed. The previous Administration recognised that this was not a matter that they could tackle immediately but only over a very long

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      period. The hon. Gentleman will be familiar with the fact that the Dyfed county council education authority, on which he serves, has in the past, and with the approval of the previous Administration, allocated most of its money to comprehensive schools rather than to the improvement of primary schools.

      Teachers
      Mr. Alec Jonesasked the Secretary of State for Wales how many teachers were employed in Wales in 1978–79 and how many are assumed to be employed in 1980–81, based on the assumptions underlying Cmnd. 7746, "The Government's Expenditure Plans 1980–81"?
      Mr. Michael Roberts: I refer the right hon. Member to the answer given on 9 November by my right hon. Friend.
      Mr. Jones: I do not have the advantage of having that answer with me. Since the White Paper clearly indicates that there will be 21,000 fewer teachers in post next year as opposed to last, can the hon. Gentleman say how many of those 21,000 will be found from among teachers in Wales?
      Mr. Roberts: The White Paper does not refer only to England and Wales. The figure for England and Wales is 18,000.In determining the rate support grant we have assumed that the teacher force in England and Wales will fall by 3·7 per cent. between 1978–79 and 1980–81. Over the same period pupil numbers will fall by 4·7 per cent. I cannot give the hon. Gentleman separate figures for Wales. I can only give the figures for England and Wales. However, I can add that the pupil-teacher ratio next year should remain at its present best ever level of 18·7 to 1. Therefore, when we talk about the number of teachers employed we must take into consideration the falling rolls in our schools.

      Steel Industry
      Mr. Andersonasked the Secretary of State for Wales how many steel jobs will have been lost in the public and private sectors in West Glamorgan between November 1978 and March 1980 on the basis of current plans.
      Mr. Nicholas Edwards: About 2,000. Approximately 900 have already taken
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      effect and the remainder would take place before March 1980 on the basis of firm current plans.
      Mr. Anderson: Since there have been previous failures of communication between the Secretary of State and the British Steel Corporation—I accept through no fault of his own—may I ask the right hon. Gentleman whether he is aware that there is a BSC document in existence, a copy of which I have seen, which envisages a further reduction in capacity at Port Talbot which will have the consequential effect of 3,000 further redundancies in West Glamorgan, on top of those that the right hon. Gentleman has already announced? Do not the redundancies that he has announced and those in prospect together make the West Glamorgan problem one on the scale of Shotton and Corby? How does he reconcile that with the downgrading of West Glamorgan for RDG purposes?
      Mr. Edwards: I am aware that the British Steel Corporation is considering possible substantial additional redundancies in the area. I agree that that would have a serious effect on the area. However, the BSC board has taken no final decision on the matter. I have already indicated to the House in an earlier answer our flexible approach to regional development and special development areas, and we shall always examine new circumstances when they develop.

      Unemployment
      Mr. Rowlandasked the Secretary of State for Wales what estimate he has made of unemployment levels in Wales in 1980 based on the Treasury forecasts of minus 2 per cent. rate of growth in 1980.
      Mr. Nicholas Edwards: It is not possible to forecast the effect on unemployment generally or in individual regions, but the underlying trend would be for increasing unemployment in Wales, as elsewhere.
      Mr. Rowlands: Is the Minister aware that, in addition to the underlying trend, there are BSC proposals suggesting 3,500 redundancies at Port Talbot and 6,500 at Llanwern, and a subsequent loss of 6,000 jobs in the pits associated with the steel industry? Will the Minister say whether he has seen those suggestions, and does

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      he plan to stand idly by and wash his hands of the affair, as he has previously said, or will he intervene this time on behalf of the Welsh people?
      Mr. Edwards: As I indicated in answer to an earlier question, the Government were informed only last Wednesday of the latest scale of the marketing problem confronting BSC. The board has made no firm plans but is considering the situation that it faces. In those circumstances, it would be wrong for me to make specific commitments about remedial measures or other action.
      Mr. Wigley: The Secretary of State knows of the 2,000 redundancies planned at the pump storage scheme at Dinorwic, Gwynedd. Will he ensure that there is a public investment programme to provide jobs to avoid the Government having to support these people when they are out of work?
      Mr. Edwards: As I have indicated, we are prepared to look at the situation as it develops. The hon. Gentleman should not always make the assumption that the people working at Dinorwic will fail to find jobs. In my constituency in West Wales over the years we faced similar problems with far bigger construction projects. The hon. Gentleman should not exaggerate the scale of the problem in his constituency.
      Mr. Best: Does my right hon. Friend agree that it should not lie in the mouths of Labour Members to ask questions about unemployment, when seemingly amnesia enables them to forget that under every Labour Government since the war unemployment has risen?
      Mr. Edwards: My hon. Friend is right. The Labour Government came into power when unemployment in Wales stood at 38,000, and they took it up to well over 100,000.
      Mr. Alan Williams: Wales is due to lose 15,000 jobs as a result of its share of unemployment generated by the Treasury, it stands to lose the same number again through closures at Shotton, Llanwern and Margam, and half as many again in the coal industry, so how does the Minister justify cutting back regional aid and assistance to Wales?
      Mr. Edwards: I have never accepted the right hon. Gentleman's forecasts, and
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      I do not accept the figures that he has given to the House now. Previous experience suggests that his forecasts are unreliable. I remember what he said about the regional employment premium before the Labour Government abolished it. If we are faced with new and grave difficulties, as indeed we are, we shall concentrate assistance where it is most needed, and that is precisely what the Government are doing.
      Mr. Alec Jones: If the right hon. Gentleman is dissatisfied with the forecasts from this side of the House, will he give his forecast of how he sees unemployment developing in Wales? If the figures given by my hon. Friend the Member for Merthyr Tydfil (Mr. Rowlands) are true and the Government believe that unemployment might reach that figure, the right hon. Gentleman has a duty to make a statement to the House on the steel industry in Wales.
      Mr. Edwards: As I told the House in my first speech from this Dispatch Box after the election, we face an underlying rise in unemployment trends. Quite clearly if we face a world recession, unemployment is also likely to rise, for that reason. But I do not share the right hon. Gentleman's confidence, faith or belief in firm forecasts of this kind. They tend to be extremely unreliable.
      Mr. Rowlands: On a point of order, Mr. Speaker. In view of the unsatisfactory nature of the Minister's reply, I beg to give notice that I shall seek an early opportunity to raise the matter on the Adjournment.

    ARTS
    Mrs. Renée Shortasked the Chancellor of the Duchy of Lancaster how support for the arts in the United Kingdom compares with that given in other member countries of the EEC.
    The Chancellor of the Duchy of Lancaster and Leader of the House of Commons (Mr. Norman St. John-Stevas): Following the hon. Lady's question of 25 July—[Vol. 971, c. 255–56]—I have made extensive inquiries into this matter. I regret to say that it has not been possible to obtain the statistics on which to make a reliable comparison. I can, however, say that central and local government

    21
    support for the arts, museums and galleries and libraries in the United Kingdom is broadly of the order of £7 a head.
    Mrs. Short: I thank the Chancellor of the Duchy for his reply, which I suppose I would not have received if I had not put down the question again, having waited since 25 July. However, is he aware that every country in the EEC provides much more support for the arts as a whole and that many cities put our contribution to shame? If the right hon. Gentleman does not have the correct information, I should be glad to let him have it.
    Mr. St. John-Stevas: I am grateful to the hon. Lady for raising this important question. I have a number of figures in front of me which indicate that we are not bottom of the EEC league. I shall gladly send her those figures, because I know that she is in a position to make them widely known.
    Mr. William Clark: Will my right hon. Friend say whether there is any hope of the arts in this country and in other member countries of the EEC obtaining a grant from the EEC budget?
    Mr. St. John-Stevas: That is an interesting suggestion. There is a certain amount of trouble going on at the moment and perhaps this might not be the best moment to raise the matter. However, when that little local difficulty is out of the way I shall pursue my hon. Friend's suggestion.
    Mr. Faulds: Does not the right hon. Gentleman recall that I revealed to him during the VAT debate on the Second Reading of the Finance Bill comparative figures of EEC expenditure on the arts? If he does not remember that, perhaps he will get one of his civil servants to look up those figures and inform him of them.
    Mr. St. John-Stevas: I remember all the hon. Gentleman's revelations. If his hon. Friend the Member for Wolver Hampton, North-East (Mrs. Short) agrees, I shall send him a copy of the letter that I am sending to her. He will then find that the position is not quite as bad as he thinks.
    Mrs. Dunwoody: With the greatest respect to the right hon. Gentleman, most
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    EEC countries support their provincial theatres far better than Britain does. There is a clear indication that, far from receiving support, provincial theatres, like the one in my constituency, will have their allocations cut.
    Mr. St. John-Stevas: I am afraid that the standards of living and work in most EEC countries are higher than they are here. That is inevitably reflected in the level of support that can be given to the arts.

    NATIONAL COLLECTIONS (CURATORS)
    Mr. William Hamiltonasked the Chancellor of the Duchy of Lancaster for what appointments of curators of national collections he is responsible.
    Mr. St. John-Stevas: None, Sir.
    Mr. Hamilton: Does the right hon. Gentleman agree that, in view of recent events, it is desirable that the Minister responsible for the arts should have some responsibility for the appointment of a curator of the Royal pictures in Buckingham Palace?
    Mr. St. John-Stevas: It is a private collection which has nothing to do with the Government. With regard to this matter, I offer to the hon. Gentleman the advice of Lord Melbourne—"Why cannot you leave it alone?".

    ARTS COUNCIL
    Mr. Neubertasked the Chancellor of the Duchy of Lancaster when he next expects to meet the chairman of the Arts Council.
    Mr. St. John-Stevas: On 10 December.
    Mr. Neubert: Is my righthon. Friend aware of the serious threat that is posed to small orchestral budgets by the decision of the DHSS to exact national insurance contributions from employers of casual musicians? Will he persuade his right hon. Friend the Secretary of State for Social Services to withdraw his predecessor's ruling and take the case out of the courts forthwith?
    Mr. St. John-Stevas: I am grateful to my hon. Friend for raising the matter.

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    I shall certainly raise it with my right hon. Friend the Secretary of State for Social Services.
    Mr. Edward Lyons: Does the right hon. Gentleman appreciate that the most successful opera companies still require outside subsidy? Will he assure the chairman of the Arts Council when he meets him that the Government will guarantee the survival of full-time opera companies in this country, including the remarkably successful English National Opera North, which has been the most successful artistic innovation in the North for a decade?
    Mr. St. John-Stevas: I shall do my best to secure anoverall grant for the Arts Council that will enable it to discharge its responsibilities. However, under our constitution, how that grant is spent is a matter for the council. Like the hon. and learned Gentleman, I appreciate the excellent work done by the English National Opera as well as by the Royal Opera House, Covent Garden. I wish that the Royal Opera House directors would wait to see the outcome of the Arts Council decisions before claiming that it is about to be closed down.
    Sir Anthony Meyer: Since it is a good Conservative principle to invest in success, will my right hon. Friend advise his Cabinet colleagues that the one thing that we are good at in this country is the arts and that money is much better spent on that than on propping up industries that are about to collapse?
    Mr. St. John-Stevas: We are extremely good at the arts. However, I would not go as far as my hon. Friend and say that that was the only thing we are good at. We are good at that, among a whole range of things.
    Mr. Faulds: I should like to be fair to the right hon. Gentleman because, as the House knows, there is considerable personal affection between us. [Interruption.] Why not? Does the right hon. Gentleman recall that in a public speech a few days ago he compared the State subvention of the arts—he gave a figure of £120 million or £140 million—to private and industrial patronage, which is running at about £5 million? Will he make a personal declaration of faith in the public subvention of the arts?
    Mr. St. John-Stevas: I am delighted to make a declaration—more than a declaration of faith, a declaration of fact, of the Government's support for the public sector. Of course that is and will be the major component in the support of the arts. I have made clear that we hope that the general level in the coming year will be the same as last year. However, I am looking for extra money from the private sector.
    I am grateful to the hon. Gentleman for his declaration of affection. I remember that he raised the question of my wedding before. I shall certainly ask him to be a bridesmaid at it, when it occurs.

    ARTS
    Mr. Wigleyasked the Chancellor of the Duchy of Lancaster if he is satisfied that enough is being done to decentralise the availability of the publicly funded arts.
    Mr. St. John-Stevas: A great deal has already been done, but the Arts Council and Welsh Arts Council are alive to the need to keep the position constantly under review, given the resources and facilities available.
    Mr. Wigley: Does the Minister accept that many of the arts are still over centralised in London, particularly live theatre and some of the visual arts? Will he give an assurance that if there is any restriction on finance for the arts it will not in any way stop a move towards greater decentralisation?
    Mr. St. John-Stevas: Certain things have to be centralised in London. However, the Arts Council, with my full support, is concentrating more and more of its finances on the regions. The proportion of the Arts Council budget for England and Wales that is invested in the regions has grown from one-third 20 years ago to two-thirds at the present time. That is a development which I welcome.
    Mr. Buchan: Does the right hon. Gentleman agree that, apart from the arts decentralising, the touring of nationally based opera, as well as orchestral work and theatre, faces the threat of cuts? Does he further agree that private patronage can hardly replace that, since the only notable recent example was his

    25
    snaffling of the portrait of Cardinal Newman into his private office?
    Mr. St. John-Stevas: The private sector has made a notable contribution towards helping the Welsh National Opera to come to London. That has shown people here the high standards of that opera company, and it has been an important contribution. Certainly I support touring by the various opera companies but, in the ultimate event, it is a decision for the Arts Council and not for me.
    Mr. Chapman: Has my right hon. Friend made any estimate of the number of paintings and other works of art in the capital that are kept permanently out of public sight? Could some of these he lent to the provinces?
    Mr. St. John-Stevas: It is the policy of the various national museums to lend their pictures to the provinces, and that again is something that I welcome.

    REVIEWING COMMITTEE ON THE EXPORT OF WORKS OF ART
    Mr. Canavanasked the Chancellor of the Duchy of Lancaster when next he expects to meet the Reviewing Committee on the Export of Works of Art.
    Mr. St. John-Stevas: I have no plans to meet the reviewing committee in the near future.
    Mr. Canavan: Why did the Minister and the committee allow a millionaire chancer like Axel Springer to bend the rules by exporting a valuable work of art under the pretext of gifting it to a British museum on condition that he be allowed to borrow it back for the remainder of his life? Is it not absolutely irresponsible to deprive the British public of that valuable work when enough money was raised by public subscription to keep it in the country and there is no guarantee that it will ever be returned?
    Mr. St. John-Stevas: I believe that the position is the opposite of that outlined by the hon. Gentleman. The purpose of export control regulations is to ensure that, in the long run, the work of art concerned remains permanently in this country. Contrary to the hon. Gentleman's impression, the arrangement has secured that after a period of years the
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    work will return to this country. It will be obtained for nothing and enrich our art collection in the future.

    ROYAL ACADEMY
    Mr. Cormackasked the Chancellor of the Duchy of Lancaster whether he has any plans to make an annual grant to the Royal Academy.
    Mr. St. John-Stevas: No. But I understand that the Royal Academy has been in touch with the Arts Council.
    Mr. Cormack: Will my right hon. Friend have another think about the matter? I am sure that he will agree that the Royal Academy has contributed greatly to our cultural and artistic life, and it would be a tragedy if it went to the wall. Will he at least encourage the Arts Council to consider most sympathetically any request, and will he consider increasing the Arts Council grant to meet it?
    Mr. St. John-Stevas: I am afraid that I cannot give the undertaking that my hon. Friend requires, because there has been no tradition of Government support for the Royal Academy. However, I recently read in the Sunday Telegraph—so it is likely to be true—that the postimpressionist exhibition at the Royal Academy is so successful that it is not likely to be facing an immediate financial crisis. Perhaps it is along those lines that the Royal Academy's financial problems can be solved.
    Mr. Faulds: Just to make this a bipartisan occasion, will the right hon. Gentleman listen to the request of his colleague, who knows a great deal about these matters, and reconsider? Within the next few years public subvention for the Royal Academy will be necessary if it is to survive at all.
    Mr. St. John-Stevas: If it were true that the Royal Academy could not survive without public subvention, no doubt a case could be made, but it should be made to the Arts Council and not to me. I am at present searching for money for existing institutions that are supported, and I do not believe that this is a good moment to add to the list.
    Mr. Alan Clark: Does my right hon. Friend agree that the Royal Academy has

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    been a tenacious repository of recidivist artistic taste for the past century?
    Mr. St. John-Stevas: I do not have the connections of my hon. Friend, and I defer to his expert opinion in these matters, but I should not like to commit myself one way or the other.
    Mr. Ogden: When the right hon. Gentleman is seriously considering which institutions will receive aid will he bear in mind that the majority of previous Ministers with responsibilities for the arts lost their seats at the following general election?
    Mr. St. John-Stevas: I trust that I shall be the exception that proves the rule.

    WORKS OF ART (EXPORT)
    Mr. Dalyellasked the Chancellor of the Duchy of Lancaster if he is reviewing his policy on the potential export or loan of major works of art, in the light of both the case of the 1740 Dresden cabinet, loaned by Mr. Axel Springer, and the Michaelangelo Ton do, which he did not allow to be loaned to the Union of Soviet Socialist Republics.
    Mr. St. John-Stevas: The reviewing committee on the Export of Works of Art is currently considering whether a procedure specifically designed for tem-
    28
    porary exports could be incorporated into the export control regulations. However, neither of the two cases referred to by the hon. Member bears directly on the reviewing committee's consideration. In the case of the Dresden cabinet, the owner is the Victoria and Albert museum which, as a Crown body, is not bound by the export control regulations. In the case of the Ton do, the reason for refusing an export licence lay in its unique quality.
    Mr. Dalyell: In this admittedly complex field, is there not a danger that if one country introduces export control regulations and assumes that they will be adhered to other countries will, tit for tat, play the same game? Although I do not suggest that the Federal Republic will put an embargo on the Dresden cabinet, as a matter of principle are there not great dangers for the future?
    Mr. St. John-Stevas: I do not believe that the hon. Gentleman's fears are well founded. The Federal Government have given us a specific guarantee that they will facilitate the return of the cabinet. As to the Tondo, the advice that it should not be given a licence came to me from the reviewing committee within a few weeks of my assumption of office. Unless there had been clear indications to the contrary, it would have been imprudent for me to overrule that advice.

EUROPEAN COUNCIL (DUBLIN MEETING)
The Prime Minister (Mrs. Margaret Thatcher): With permission, Mr. Speaker, I will make a statement about the meeting of the European Council in Dublin, which my noble Friend the Foreign and Commonwealth Secretary and I attended at the end of last week.
There was a general debate on economic prospects, including energy. It was dominated by the feeling of uncertainty about the future of oil supplies, especially in view of the situation in Iran. It was agreed that inflation is still the main economic problem.
Otherwise, most of the time in formal session was devoted to Britain's budget problem. We were not able to reach agreement on an acceptable reduction in Britain's excessive net contribution to the Community budget. Our partners recognise that we have a problem. But they, of course, have their own problems, too. We and they did not see eye to eye on the magnitude and seriousness of the difficulty for the United Kingdom or on the measures that would be required to deal with it properly.
In spite of North Sea oil, we are still among the least prosperous of the member States but are nevertheless expected to be one of the main contributors to the Community budget. On present Community policies, the prospects are that the burden would increase even further. We stressed, therefore, that any solution must be a lasting one. Otherwise, the problem would come up yet again with damaging consequences for us and for the Community as a whole.
Agreement in Dublin would no doubt have been possible had we been ready to accept that changes to the financial mechanism negotiated in 1975 would have settled the matter in full. That would have reduced our net contribution next year by about £350 million, one-third of what we are expected to pay. The House clearly expressed its views on such a settlement in the debate last week. We were therefore confident that we would have the full support of right hon. and hon. Members in saying that this was totally inadequate.
Removing the constraints which limit the effectiveness of the 1975 mechanism
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can very well form the basis for such a solution, but, by itself, it is nothing like enough. It does not deal at all with the problem that our receipts per head from Community expenditure are less than half the average for the whole Community. This must be the second element in any solution.
There was, however, considerable resistance to any action to remedy that part of our problem. Eventually, it was agreed that the Commission should bring forward proposals for developing supplementary Community measures which would lead to more Community expenditure in this country.
The third and longer-term element in tackling the problem is the pattern of Community expenditure. The Commission suggested that more should be spent on structural measures and less on agriculture. This approach was generally supported.
Several countries which had been helpful in searching for a possible solution felt that more time was needed. We therefore agreed to another early meeting of the European Council to try to find a satisfactory settlement. It is left to the next President, the Italian Prime Minister, to judge when that meeting should be called.
I cannot give the House any reassurance about the success of that further meeting, but, if others will show willing, I am ready to do the same in the search for a genuine compromise. I left our partners in no doubt that my room for manoeuvre was limited, but I did not feel it right to refuse to make this further effort.
The European Council also wanted progress on other current Community issues—fisheries, energy and sheepmeat. These are seperate questions, each of which will be considered on its merits. Indeed, we are already considering them in that way.
So far as the budget is concerned, I naturally regret that this meeting did not find a satisfactory solution. The Community has much to do together in the larger world. We must now see whether the possible elements which we identified in Dublin can be built up quickly in order to produce an adequate and lasting settlement.
Mr. James Callaghan: Before I come to the important question of the Community budget, may I ask about an issue on which the right hon. Lady has not reported in her statement but which is referred to in the conclusions of the Presidency, namely, the serious unemployment situation? It is stated that unemployment can be dealt with "primarily through increased investment". As our own investment is calculated to fall during the next 12 months, will the right hon. Lady say what contributions she made to that part of the debate?
Will the right hon. Lady inform us of her attitude to the reorganisation of working time, which is also mentioned in the conclusions?
With regard to energy, it is stated that
"the European Council considers that efforts must be made both by producing and consuming countries to create greater stability."
The right hon. Lady has not given us any information about that. What steps were proposed to follow this up? Is there to be a dialogue between the Western IEA countries and the oil-producing countries, or in what way is the Community attempting to "create greater stability"?
With respect, Mr Speaker, I should like to return later to the important issue of the budget, but I think that the issues which I have raised are also important and should be dealt with.
The Prime Minister: The answer to the right hon. Gentleman's first question, on serious unemployment, is also to be found in the communiqué, which states:
"The fight against inflation and unemployment should not be made more difficult through attempting to compensate by increases in money incomes for the real transfer of purchasing power which has taken place to the oil producing countries. Moreover, monetary policy should continue for the time being to support efforts to counter inflation."
It was generally realised that unless we tackle inflation we shall continue to have a problem with unemployment, and the whole of the debate on the economy was conducted on that basis.
With regard to the reorganisation of working time, very little time was spent upon that matter. As the right hon. Gentleman knows, many of us believe that the important thing is to keep this country competitive. If there were to be a very
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strong agreement on work sharing, we should cease to be competitive. That view, I think, was held by most member countries there. It was therefore agreed that the proposals put forward to the Council should be further considered with the "social partners". As the right hon. Gentleman knows, they are both the employers and the representatives of the trade unions.
The energy debate was part of the general economic debate. We did not have a prolonged debate on energy on its own. There were no specific proposals for a formal dialogue between the consumer and producer countries.
Mr. Callaghan: The right hon. Lady's answers are not very satisfactory on either of those matters, especially concerning the reorganisation of working time, on which the Council of Ministers is not considering proposals which have been put forward but has in fact adopted a resolution. However, we shall return to that in due course.
On 16 July last, the Government accepted an amendment tabled by the Opposition stating that what was necessary was a fundamental readjustment of the budget and a reform so that expenditure was a least balanced by, or
"not greater than the receipts".
That amendment was accepted by the Government. We reaffirm it today.
The right hon. Lady said that the result of the Council that had just been concluded was
"totally unsatisfactory."
Those words were used by the right hon. Lady, and I can certainly support them. What I want to ask her is, why did she give the impression before she went to Dublin that there was a deadline if she did not intend to stick to it? When she got there, apparently they had a fierce row and she said 'I want my money"—
Mr. Rost: The right hon. Gentleman did nothing in five years.
Mr. Callaghan: —and returned at the end of the day having said that she was willing to compromise.
What does this mean? Is the right hon. Lady standing by her intention of achieving a broad balance, or by "compromise" does she mean that she intends

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to go for something less than that? Or is the compromise to be found not in financial terms: is it to be found by making bargains with the Community on some other matters? The right hon. Lady has got herself into the position in which, unless she puts some proposals forward, there will not be another meeting. Thus, we did not press her on her tactics—deliberately so—before she went to Dublin because we assumed that she had some cards up her sleeve, but when she got there we found that she had nothing up her sleeve.
Therefore, the right hon. Lady must now come forward with some proposals. The House will want to press her on what those are and what is to be the nature of the compromise that she is considering.
On reflection, does the right hon. Lady not think that it is a pity that she deserted the price freeze on the common agricultural policy that she inherited from us last spring? Would she not then have gone to Dublin with some levers in her hand instead of going there and returning entirely empty-handed?
The Prime Minister: With respect to the right hon. Gentleman, he is the last person who is in a position to criticise the budget contributions that we have to make to the Community. When he started the renegotiation of the Community contributions, this country was making a net contribution of £16 million a year to the Community budget. It went up during his tenure of office to £281 million, then to £632 million and this year to £919 million, and next year it will be £1,000 million. That was his contribution to renegotiation—to leave us with a considerable and increasing budget. The spectrehanging over Dublin was very much as they said—that we had negotiated on this basis, that we had renegotiated at Dublin previously on this basis, yet we were then coming along to renegotiate yet again. We had to try to perform against that background.
Secondly, the right hon. Gentleman refers to "fundamental reform" of the budget, which certainly was in the resolution passed by the House.
Fundamental reform may be desirable—I happen to think that it would be—but fundamental reform would change all the existing mechanisms, all the existing bases, of the budget. I still think that
34
it is what we need, but anyone who thinks that we could get that immediately does not understand how the budget works.
Therefore, one goes not to fundamental reform but to what we did—to using the existing Community mechanisms. Those were two—to diminish the contributions, and to increase the receipts. Those existing mechanisms were the ones that we were operating on. We were offered £350 million on reducing the contribution, and when it came to increasing the receipts there was considerable reluctance to do that because the other leaders recognised that receipts would have to be reduced in their own countries. But we should not get relief for next year unless we used the existing mechanisms. In the long run, I think there needs to be a change, a fundamental reform, in the budget, but that will take time.
Thirdly, the right hon. Gentleman asked me about the deadline. The instruction from Strasbourg to the Commission and to the Council of Finance Ministers was first to find the facts and then to make proposals in time for decisions at Dublin. That was what we were charged with. All right—it takes longer to get decisions on precise figures. We were offered £350 million. I personally thought that that was not enough, that we should get more and that it was worth while going on negotiating to get more, particularly as a number of countries in that Council of Ministers were trying very hard to help us a achieve a better result.
As for the price freeze, I think that, when the right hon. Gentleman left office, all his economic policies, including a price freeze—he had held up many price increases for the election—and incomes policies were collapsing, and we had to go to a totally different system.
The right hon. Gentleman's final point related to two matters—broad balance, and bargains on other matters. Fisheries, energy and sheep meat are not linked to a solution of the budget problem. They must be tackled on their merits, and they are being tackled on their merits. The broad balance, of course, is the starting point, but the position that was put to me very strongly indeed was that the third element in the solution—that of structural changes in the budget, which consist of getting less spent on agriculture and more on other investment—will take time. Colleagues said to me

35
"Yes, we are prepared to do more to help, but it will take time. Therefore, we must have a period of intense activity between Heads of Government and officials."
Mr. Callaghan: I think that the House will be relieved to know—[HON. MEMBERS: "Not again."] When the hopes of the whole House have been disappointed as they have been, we are right to hold the Government to account for that failure.
I think that the House will be relieved to know that in talking about a compromise the right hon. Lady is not talking about such issues as fish, energy or the other matters that have been raised. We therefore assume that what she is discussing is whether the sum shall be less than £1 billion, or whatever the figure will be next year. If that is so, does she really believe that at some Council which is to be held in February she will get structural alterations in the CAP, which we have been promised for the last five years? She is right: they were promised in Dublin in 1975. Does she really believe that the other members of the Community intend to work out structural changes which will enable her to take anything like £1 billion out of the necessary changes to the CAP by February? Is that not just as unrealistic as her previous deadline?
The Prime Minister: A moment ago the right hon. Gentleman was asking for total reform of the budget. Now he is doubting whether one can even get structural changes, or determination to undertake structural changes, by February.
May I once again point out that there are three elements under existing mechanisms for solving our budget problem? One is on the contribution side, where we have an offer of £350 million. The second is on the receipts side, to increase our receipts. If our receipts from the Community are raised, obviously the net contribution goes down. On that side, we encountered considerable resistance, but that is the side upon which we shall concentrate in the coming three months—as the right hon. Gentleman will have seen from the communiqué, which charged the Commission to find supplementary measures in this country which would
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raise our receipts from Community expenditure. Certainly the third element, structural changes in the budget, will take longer, but unless they are brought about within the next 18 months we shall be through the 1 per cent. ceiling—[HON. MEMBERS: "Eighteen months?"] We are talking of the financial year 1980–81 —next April to April 1981. Unless some movement is made on structural changes, we shall go through the 1 per cent. VAT ceiling.
Mr. David Steel: Is the right hon. Lady aware that it is well understood in the country that she inherited a rapidly worsening situation and that there is no need for her to labour that point, because it is accepted?
Does the right hon. Lady accept that the question of the budgetary imbalance and the unacceptable distorting effects of the CAP are problems for the Community as a whole, as she has just said, and that it was perhaps a mistake to pretend, pre-Dublin, that she was going to do battle on the British problem? Since the Prime Minister now accepts that it is a question of balancing expenditure on agriculture with other structural measures, why did not her Treasury Ministers support the proposals of our Members of Parliament at Strasbourg for transferring expenditure from agriculture to the regional and social funds?
The Prime Minister: Part of the problem with the CAP arises from the proportion of the budget taken by the agriculture budget. That is what we mean by a structural switch. When it comes to reforming the CAP, some of the proposals before the Council of Ministers—which we did not discuss in detail—were not favourable to Britain. Although we accepted the objective of reforming the CAP in order to reduce its proportion of the budget, we could not accept the particular proposals before the Council of Ministers at this time. They would have damaging effects for Britain on milk and sugar.
One hopes that there will be a determination to reduce the proportion spent on the budget by a specific percentage. It will be remitted to the Agriculture Ministers, who will decide how that shall be brought about. The right hon. Member for Roxburgh, Selkirk and Peebles (Mr. Steel) also asked me why we did

37
not support the European Parliament in its resolution on milk. There is a more important principle at stake as to whether, having agreed in the Council of Ministers on a budget, one should then individually support the European Parliament on issues which happen to suit us. That particular matter would have suited us and therefore we had to take up a position on the larger principle.
Sir Derek Walker-Smith: Does my right hon. Friend appreciate that public opinion is wholly behind her in her stalwart efforts to achieve a sensible and satisfactory solution to these problems? Does she also appreciate that the best argument for her formidable advocacy is the restructuring of the CAP with a view to reducing its proportion of the budget to a much lower and realistic level, from which Britain will certainly benefit? Does she further appreciate that no amendment of the Treaty of Rome is required to bring this about? It need not be a long-drawn-out matter unless there is opposition by vested interests, which I am sure she would overcome.
The Prime Minister: I entirely accept the conclusion of my right hon. and learned Friend that we shall have to restructure the whole expenditure to reduce the proportion spent on agriculture. That indeed is our objective. Italy also feels strongly that we must go ahead and do that because she does not profit from the existing CAP. We shall, of course, continue our efforts in that direction, but I must stress that we cannot wait for the reform of the CAP before getting relief on the budget.
Therefore, the proposals that we made—taken from an excellent Commission paper—were designed to achieve that end. In the short term, we could achieve our aims through relief on contributions and more by way of receipts. We cannot wait for a total reform of the CAP in order to get considerable relief from the heavy contributions that we shall make this year and next year, and the even heavier ones that we shall be making in the years after that.
Mr. Jay: Is it not clear from everything said by the right hon. Lady today that there will be no hope of real economic recovery for this country as long as we remain members of the Common Market?
The Prime Minister: No, that is not clear at all. There will be great hopes for the economic recovery of this country both through existing policies and by a reduction in our net contribution to the Common Market.
Mr. Rippon: Is my right hon. Friend aware that there is widespread support for the Government's efforts to change the size and shape of the budget? Will she consider suggesting that there should be a joint meeting of Finance and Agriculture Ministers to make adequate preparation for the next summit? Does she agree that a series of summits which raise expectations that are not realised is damaging to the cause of a united Europe? Is she aware of the considerable misunderstanding in Italy and in Holland of the Government's failure to support the European Parliament proposal for reducing the farm budget?
The Prime Minister: I thank my right hon. and learned Friend, though I did not know that there was a misunderstanding. If there is, we shall endeavour to put it right. We remitted the agriculture paper not only to Agricultural Ministers but to Finance Ministers. We thought that it was time that the CAP decision-makers had their Finance Ministers sitting by them before they came to expensive conclusions. That is being followed up already.
Mr. Molyneaux: As one who has little faith in summit talking of any kind, may I assure the right hon. Lady that there will be widespread support for really tough action to reassert Britain's interests and rights?
The Prime Minister: I am grateful to the hon. Gentleman. I was not quite certain whether I was being criticised for being too tough or for not being tough enough. I have no doubt that I shall know in due course.
Mr. Dykes: Since the Labour Government, while in office, did nothing about the developing budget problem, hon can the Opposition now have the nerve to be tempted into unleashing a general anti-EEC posture? Will my right hon. Friend reassert the fundamental importance to Britain of our membership of the Community for many reasons, and will she express a feeling of optimism that, at the February summit, solutions will be found?
The Prime Minister: The Community is quite capable, if it wants to, of finding a solution with Britain as a member. At the moment, the Community is reluctant either to contribute more or to take less in receipts. The Community did not like the intensity of our message and the fact that it would have to face up to it but the Community can sort it out. There is no question of our coming out of the Community. Britain is better in the Community, and the Community is much better with Britain as a member.
Mr. Donald Stewart: Is the right hon. Lady aware, recalling her strident bugle calls before she went to Dublin, that she has today reported an unmitigated defeat? In view of the response of our so-called partners, does she agree that she is now faced with the stark choice of either economic suicide for the United Kingdom or our withdrawal from the Common Market?
The Prime Minister: The right hon. Gentleman will not be surprised if I say "Absolute nonsense". In the first place, we have to get relief for the year 1980–81 and also a formula that will give relief in subsequent years. We shall do far better and enjoy a far more important position in the world as a member of the Community than we should on our own.
Mr. Maclennan: Does the right hon. Lady accept that her "all or nothing" stance at the Dublin meeting failed to deliver the necessary £1,000 million? Will she now turn, more constructively, to the third element of the package—structural reform? What is the Government's attitude to the Commission's view that there can be no long-term resolution of this difficulty without increased expenditure on new programmes? Does she agree that if we opt simply for cutting down the CAP budget we shall not see any return?
The Prime Minister: We do indeed support structural reform, but there was a danger at one period during the summit meeting that my European colleagues would want to leave everything until structural reform had occurred. That would have taken far too long. I had to turn down in no uncertain way such an element in the communiqué. I agree that we need structural reform, but it will take longer to achieve that than to secure re-
40
lief on contributions and an increase in receipts. I have made it perfectly clear that I believe that the limit on the budget of 1 per cent. contributions on value added tax should not be exceeded.
Mr. Edward Gardner: Does my right hon. Friend agree that the follies and extravagances of the common agricultural policy have been responsible primarily for what has become to us an unacceptable situation which needs an urgent and equitable solution? Does she accept that her solution, which she pressed with such formidable advocacy and determination in Dublin, has the overwhelming approval of the British people?
The Prime Minister: I wholly agree with my hon. and learned Friend that the main component of the expenditure is the common agricultural policy. The rapid annual increases in the CAP budget have given us tremendous problems. Many of our partners profit far more than we do from that policy. That is why we have to reform it in order to reduce expenditure. However, we must beware that the methods used to reduce expenditure do not act badly on our farmers in any way.
Dr. Gilbert: In any civilised community, be it local, national or international, should not the rich, strong and powerful help those who are less fortunate? Why is the Prime Minister so diffident? Why is she prepared to settle for a mere book-keeper's balance? Why is she not asking the other European countries for a generous contribution to help us all—say £1,000 million?
The Prime Minister: In the opening of my statement I included a section which showed that if we based the calculation on the average gross national product per head we could apply to be net beneficiaries. I did not ask the Community for that. We ask to be in broad balance. Britain is not asking for anything from the Community. Some of our partners in the Community do not see Britain as one of the less prosperous countries, although that is what the figures show. The other countries say to me "You are in the best position of all because you have oil, gas and coal and do not face the uncertainties which the other countries face".

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Others see our position differently, but the figures do not support that view. Our Starting position for the next summit is a broad balance. I must in candour say to the right hon. Gentleman that I doubt whether we shall achieve that next year because the structural changes will take longer.
Mr. Peter Mills: I congratulate and support my right hon. Friend on the stand that she has taken. Will she bearin mind that reform of the CAP is not only in our financial interests and in the interests of the consumer but in the interests of the agricultural producer? Will she continue her fight? If she has to take drastic action, as she may have to do, will she bear in mind that those involved in British agriculture will fully support her in achieving a reform of the CAP?
The Prime Minister: I am grateful to my hon. Friend. Obviously we must keep in mind the interests of the producer. Some of the principles of reform which the Commission enunciated unfortunately would have the effect of cutting back on our milk and sugar production. Most of us take the view that we should be producing more food from our own resources. Therefore, we had to enter a reservation against those methods.
Mr. Eadie: Does the Prime Minister agree that she went public before she went to Dublin, in the sense that she informed the British people of what she intended to ask from the EEC budget? Does she agree that for her own credibility and in the interests of the British people she should go public today and explain what she intends to do if she fails?
The Prime Minister: One has only to examine the figures to know what we ask for. Either we ask to be in receipt and in benefit from the budget—and I did not ask for that—or we ask, like France, which is much richer than Britain, to be in something like broad balance. The hon. Gentleman asked exactly what would happen if we did not get our way. It was painfully obvious that a number of our colleagues at the European Council realised that there would be an immediate crisis if we did not move any further than we did at the last Council.
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There are only two possibilities. One is to ensure that no further progress is made on any Community decision—which would be disruptive. The other, which we have not so far seriously considered, is to withhold contributions. That of course would also have considerable consequences. There are two schools of thought. Some people believe that to withhold contributions would be better and more direct, and others believe that it would be better to disrupt. Let us hope that we shall move a great deal further before applying either of those suggestions.
Mr. William Clark: I congratulate my right hon. Friend on the firm stand which she took in Dublin, in sharp contrast to the stand taken by the Leader of the Opposition during the so-called renegotiation. Is she aware that most people fully accept that at long last the EEC Commission recognises the unfairness of the budget? Does she agree that the offer of one-third of the amount for which we asked is far better than anything that has been offered in the past?
The Prime Minister: I am grateful to my hon. Friend. I thought that the offer was not bad as a start, particularly since one or two countries indicated that given a little time they were prepared to try to find more. There will be a period of intense diplomatic activity both on a bilateral and multilateral basis to agree on figures before we go back to any other meeting. Unless figures can be agreed behind the scenes, the Council is not the forum where sudden increases will be offered.
Mr. Benn: Is the Prime Minister aware that her speeches have raised public expectations? Is she aware that people now want to know what she is going to do? Is she prepared to follow de Gaulle in boycotting institutions? Is she prepared to amend section 2 of the European Communities Act in order to restore power to this House? In the last resort, is she prepared to contemplate withdrawal? Does she agree that if there is no back-up action all her speeches will be sound and fury signifying nothing and that she will be known, not as the iron lady, but as the paper tigress?
The Prime Minister: With respect to the right hon. Gentleman, an offer of

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£350 million for a start is not bad. He asked whether we are prepared to boycott. Frankly, I do not think that boycotting and leaving an empty chair is an effective way of conducting ourselves. My Ministers and I will do better to fill the chairs than to leave them empty. In some cases, when one boycotts a meeting, a decision is taken by a majority. What is the point of boycotting? It is far better to be there.
The right hon. Gentleman asked whether we intend to amend section 2of the Act. No, Sir. He asked whether we shall consider withdrawal. No, Sir. I believe that unless it is shown that the free nations of Europe can live together equitably—and it is on that basis that I am seeking a solution—the only people who will cheer are those who are based on Moscow.
Several Hon. Members Several Hon. Members rose—
Mr. Speaker: I propose to call three more hon. Members from either side and then the Opposition Front Bench spokesman to conclude.
Mr. Hordern: If in future the European Parliament votes to secure a reduction in the real burden of the common agricultural policy, will my right hon. Friend instruct our representatives at the Council of Ministers to support the decision of the European Assembly in support of the Italians and the Dutch rather than to oppose it?
The Prime Minister: May I consider what my hon. Friend has said? There is an enormous principle at stake here: does the Council of Ministers keep control of the budget, or, having agreed a budget, does it then, by minority vote, support a different view taken by the Parliament? To do that would be a considerable step. I personally agreed with part of what the Parliament put up. It was trying to reduce the amount spent on milk, but we did not agree with an increase in the co-responsibility levy on milk. So there was part that we were for and part that we were against.
I must have a look at matters in the light of the larger principle, because, if we did that for things that suited us it could go against us very adversely on other occasions when other Members of
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the Parliament put up things that would cost us money.
Mr. Spearing: Does not the Prime Minister agree that many people foresaw the effects of budgetary imbalance under the own resources formula, and that those who confidently stated that the EEC would be flexible have been proved wrong? Therefore, does not she agree that, rather than fight a fruitless battle over the next 18 months, it would be much better both for Britain and the Community to have an orderly disengagement, to the benefit of everybody concerned?
The Prime Minister: The answer to the last part of the hon. Gentleman's question is "No". There is not much point in putting everything on the own resources formula. It is not only a question of the gross contributions through levies and value added tax; it is what the Community does with the money when it has those contributions in.
Mr. Spearing: It decides.
The Prime Minister: Indeed, it does, and it is on that side that we have been trying to persuade it to increase receipts in this country. I think that we shall get further. The question is whether we shall get far enough at the next meeting. But I believe that the Community knows how seriously we take our case. I am grateful for support from all parts of the House to indicate that the whole House supports us.
Mr. Critchley: Would not my right hon. Friend have been wiser had she accepted the £350 million offered and then, at the invitation of the EEC, returned, like Oliver, to ask for more?
The Prime Minister: I obviously had to consider that. But, had we accepted the £350 million only, we should soon have been in considerable difficulty again. It was not only a question of accepting that; it would have been in full and final satisfaction of our problem, and, plainly, it just was not enough. We not only want more—I agree with my hon. Friend that we have, like Oliver Twist, to ask for more—but must secure a formula that will sort out our problems so long as we are below average income and receiving comparatively few receipts. So

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it is future years that I am concerned about as well as next year.
Mr. John Evans: Is the Prime Minister aware that no one in this country is in the least impressed by her Dublin performance, and that the only thing that she has succeeded in doing is to make a laughing stock of herself throughout Europe? Is she further aware that the British people, who are told on every side that public expenditure must be slashed, cannot understand why she does not simply refuse to hand over the £1 billion that we are contributing to the economies of our eight European partners?
The Prime Minister: I put the point that the hon. Gentleman has made, I thought even more cogently than he did. I even pointed out that our £1,000 million contribution to Europe, which is fairly wealthy, is more than the whole of our aid budget, and that does not make sense either.
The fact was that our partners did not like the message that we delivered, for the simple reason that it means their either making more contributions or taking less in receipts. But they will have to do that. After all, hon. Members who suggest that we might leave know that if we did so the Community would have to find the money. Therefore, the Community can find it with us in. That is what the majority of other member countries will wish to do.
Mr. Alan Clark: Does my right hon. Friend accept that the majority of the people of this country are not disposed to compromise on this issue and that whatever measures—I emphasise "whatever measures"—she sees fit to take to enforce concessions from the Community will have their wholehearted and enthusiastic support?
The Prime Minister: I am grateful to my hon. Friend. As he knows, I have always gone about this business on the basis that one cannot have a partnership unless there is equity among partners. Equity, of course, is historically a British concept, but I think that it is one that we bring to the Community. As I think that we have been very generous to the Community in many ways, we are entitled to expect in return understanding of our problem and measures properly to meet it.
Mr. English: Is the right hon. Lady satisfied that the advice she receives from the Civil Service on this topic is always disinterested? Is not Common Market policy advice co-ordinated in the Cabinet Office? Has not the former head of that office left the service of the Crown for the service of the French State, which, the right hon. Lady will be aware, owns the bank that now employs him? Is not that a contrast with the way in which the former head of the Civil Service felt that he should be employed by the Bank of England, not by an outside private or public body?
The Prime Minister: I receive the greatest support and help from all those in the Cabinet Office. I cannot speak too highly of their loyalty and devotion to, and work for, the cause that we are fighting for.
Mr. Shore: The right hon. Lady has said very little to the House today about her intentions, and of course it is her intentions that the House and the country now want to hear about. So may I at least invite her to reaffirm here in the House what she said at the Press conference after the Dublin summit—that what is at issue is our own money? Will she assure the House that she understood the implications of what she was saying? Will she tell the House that she is willing, if she is unable to make progress in the next few weeks, to invite the House to retake those powers of control over its own money that it abandoned seven years ago?
Finally, will the right hon. Lady make it absolutely plain, in all the talk about compromise, that she does indeed mean what she says and that she will stick to her guns?
The Prime Minister: I believe that the right hon. Gentleman is anxious to take us out of the Community, and I must view his questions against that background. I do not believe that that would be in the interests of Britain in the wider world. Therefore, I am not prepared to take Britain out of the Community.
I most certainly said that I believed that in a way this was our own money; we are asking only to have more of our own money. I am determined to try to keep as much of it as we possibly can. The first way is by increasing the receipts.

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The second, and medium-term, way is by making structural changes. The right hon. Gentleman will have been in negotiations for a very long time. He knows that one cannot go into a negotiation and give absolute pledges.
Mr. Shore: This is too important a point for the right hon. Lady to evade. What is at issue is this: it is either our own money or it is the Community's own resources, to which we have no right. This is a fundamental point—fundamental to the treaties, to the European Communities Act and to any possibility of seriously rectifying the situation. Will the right hon. Lady make clear whether her view is that what we are about is the control of our own money or getting back what is the Community's own resources?
The Prime Minister: The problem is about reducing the net contribution. I do not need to explain that to the right hon. Gentleman. In addition to the £350 million, that could be dealt with wholly by increasing the receipts from the Community. Indeed, we do not even have to bring those receipts up to the Community average per head. We would recover all of the net contribution in Britain if we brought receipts up to only three-quarters of the average receipts per head in the Community. Then the problem of the net contribution would be dealt with.
Mr. Speaker: I have received notice from three hon. Members that they wish to make applications for an emergency debate under Standing Order No. 9. I shall call the hon. Members in the order in which they submitted their letters to me this morning.

BRITISH STEEL CORPORATION
Mr. Anderson: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the proposals of the British Steel Corporation to reduce its steel making capacity to 15 million tons per annum which would cut manpower in the industry by approximately 40,000 in addition to those redundancies that have already been announced."
If implemented, these proposals would mean the closing down of a substantial
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part of the steel industry as we know it today. They are coupled with a proposal to take 2 million tons out of the export market on the ground that it is non-profitable because of the strength of sterling. It is also proposed to establish a new grouping called British Steel Holdings that could herald the start of a process of hiving off to the private sector on similar lines to Government's proposals for the National Freight Corporation.
These proposals are specific, the reduction in capacity that is proposed is certain, and the only question remaining is how that reduced capacity will be distributed throughout the country. We can calculate the job implications for each area and, indeed, each plant. For example, in South Wales the proposals would mean that approximately 10,000 jobs in the steel-making industry would be lost—3,000 to 4,000 at Port Talbot and 6,500 at Llanwern. A further 6,000 to 9,000 jobs would be lost as a consequence in the South Wales coalfield, as that coalfield supplies 88,000 tons of coking coal to the Llanwern steelworks per month. If steel making were abolished at that plant, that coking coal would not be needed.
This matter is important—this really answers itself—because in my political lifetime there has been nothing of comparable importance affecting South Wales plants or, indeed, other plants such as that at Scunthorpe. South Wales would be returned to the period of the 1930s.
This matter has both national and regional implications. These proposals would render the whole of South Wales, from Chepstow in the East to Pembroke in the West, an employment disaster area. In national terms, these proposals are related to the Government's policy on shipbuilding, the imports of motor vehicles, their monetary policy, and the strength of sterling as an impediment to our exporting capacity.
The matter is also urgent. I concede that there has been a recent debate on the steel industry, but these are new and unexpected proposals that were disclosed to the major steel union on Friday of last week, and there are questions that need urgent answers from the Government. Are the Government to stand on the sidelines, or will they intervene in this crisis?

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Will the Government allow de-industrialisation to continue; or will they bale out the corporation?
Under the Standing Order you, Mr. Speaker, are invited to consider the extent to which this matter concerns the administrative responsibility of Ministers. These proposals are due entirely to the cash limits that the Government have imposed on BSC— £450 million in 1980–81–which cannot be used to finance losses. The matter is not premature, because the BSC has admitted the scale of the redundancies. The matter falls four-square within the criteria of the Standing Order. If the House is not given the opportunity to debate this alarming and vital development, it will not be fulfilling its proper function in our democracy and will not be acting as a forum for such a debate.
Mr. Speaker: The hon. Member for Swansea, East (Mr. Anderson) gave me notice this morning that he would seek to move the Adjournment of the House for the purpose of discussing a specific and important matter that he thinks should have urgent consideration.
As the House knows, under Standing Order No. 9 I am directed to take account of the several factors set out in the order but to give no reasons for my decision. I listened with care to the exchanges on this very subject at Question Time this afternoon, in which the hon. Member took part.
I have given careful consideration to the hon. Gentleman's representations, but I have to rule that his submissions do not fall within the provisions of the Standing Order and, therefore, I cannot submit his application to the House, which was for a debate on the British Steel Corporation's proposal to the Iron and Steel Trades Confederation on Friday 30 November to axe a further 32,000 jobs, with a consequent threat to devastate many steel communities and regional economies.

SCOTTISH DEVELOPMENT AGENCY (CHAIRMAN)
Mr. Buchan: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the dismissal of Sir William Gray as chairman of the Scottish Development Agency."
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The House may be aware that this has been a burning question in Scotland during the 48 hours since the information first leaked.
First, the decision was made in a distasteful way, namely, by leaks to the press apparently from the Government, culminating in a formal announcement this morning. Secondly, the dismissal took the form of the non-renewal of Sir William's contract, which everyone expected would be renewed in a fortnight's time.
Normally, one would not question the non-renewal of a contract, but the circumstances are hardly normal and must be seen against the background of the recent forced resignation of members of the National Enterprise Board, which is the main body responsible for Government intervention and aid to industry—the SDA being the Scottish extension of the NEB, and now apparently under threat.
The matter is specific because it refers to one man, and he a man who is widely respected and trusted by both sides of industry in Scotland. It is urgent because the decision has caused dismay in Scotland. The front pages of the Scottish newspapers have headlines and comments such as:
"Dismissed SDA Chief in Row over leaks"
and
"Thatcher had me dismissed claims angry Sir William."
Sir William is not normally an angry man. The dismissal has especially caused dismay throughout industry as the comments in the press show.
Finally, the matter is important, as is shown by the nature of the comments that have been made about its being a political decision and, indeed, a decision instigated by the Prime Minister. It is a further example of the Government's intention drastically to reduce public support for, and aid to industry, especially when one considers the difficulties that face Scotland with daily news of redundancies and closures. Against that background, we cannot accept this as a normal decision. It is a political decision. The matter not only merits but requires an immediate debate in the House.
Mr. Speaker: The hon. Member gave me notice this morning that he would seek leave to move the Adjournment of the House, under Standing Order No. 9, for

51
the purpose of discussing a specific and important matter that he believes should have urgent consideration, namely,
"the dismissal of Sir William Gray as chairman of the Scottish Development Agency".
As the House knows, I do not decide whether these matters shall be discussed—that applied also to the one previously raised—there being other avenues open to the House for debate. I merely decide whether a matter is of such a scale that the opinion of the House should be registered upon it either tonight or tomorrow. That is the limit of my powers, and the House has directed me to give no reasons for my decision.
I listened with care to the hon. Gentleman, but I have to rule that his submission does not fall within the provisions of the Standing Order and, therefore, I cannot submit his application to the House.

AIRFIX INDUSTRIES LIMITED
Mr. Ogden: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific matter of national importance that should have urgent consideration, namely,
"the decision of the management of Air fix Industries to close the Mecca no factory, Binns Road, Liverpool, at one hour's notice on Friday 30 November".
I submit, Mr. Speaker, that even though this matter concerns only 900 workers—many fewer than those mentioned by my hon. Friend the Member for Swansea, East (Mr. Anderson) in connection with the British Steel Corporation—the loss of 900 jobs at one hour's notice is certainly a matter of importance which should be considered by the House.
You will know, Mr. Speaker, that I tried to raise a private notice question—I make no comment about that—
Mr. Speaker: Order. I was hoping that the hon. Gentleman would know by now that reference is never made to an application for a private notice question.
Mr. Ogden: If it can be struck from the record, Mr. Speaker, I shall be happy with that. I was trying to explain why I raised the matter in manuscript form when I had understood from members of your staff that another hon. Member
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from Liverpool had formally given you notice this morning of his intention—
Mr. Speaker: Order. I am surprised at the hon. Gentleman. If members of my staff said anything to him, I am quite sure that they did not expect him to stand up on the Floor of the House and repeat the conversation. As a matter of fact, if they gave him that advice they themselves were misinformed.
Mr. Ogden: I apologise to them and to the House, Mr. Speaker, and I shall not explain why I have taken this matter on when it might have been raised by another Member, and I expected it to be raised by another Member.
I submit that it is a specific matter—900 jobs to be lost, at one hour's notice—and that it is urgent. There is not just a sit-in at the factory; there is a work-in. Production continues, distribution continues, exhibitions continue. The workers want the product to go through.
Moreover, I submit that it is a matter of national importance. Although in the past hon. Members have been all too used to the giving of 30 days' notice, 90 days' notice, and so on, one hour's notice of closure, even if all the provisions of the law are being followed, is a matter of national importance.
I submit also that it comes within the responsibility of Ministers—the Secretaries of State for Employment, for Trade and for Industry.
For those reasons, Mr. Speaker, I ask that this matter come before the House. If I have done it in less than what I believe to be my usual courteous or knowledgeable way, I ask to be excused by yourself and by the members of your staff—because, obviously, I shall need your good will if I do not get what I want this afternoon.
Mr. Speaker: May I say to the hon. Gentleman that there is not a more courteous Member of the House than he—and that is saying a lot—and I know that he observes the rules, but one of our unwritten rules, which is a matter of honour among us all, is that we do not, except by accident, repeat conversations with servants of the House, or even conversations with one another if they are private.
The hon. Gentleman gave me notice this morning that he would seek leave to

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move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that he believe should have urgent consideration, namely,
"the decision of the management of Airfix Industries to close the Meccano factory, Binns Road, Liverpool, at one hour's notice on Friday 30 November."
As the House knows, it has directed me not to express my reasons when I give a decision in response to an application under Standing Order No. 9,I listened with great care to the hon. Gentleman, and I realise the depth of his feeling on this question, but I have to rule that his submission does not fall within the provisions of the Standing Order and, therefore, I cannot submit his application to the House.

STEEL INDUSTRY (SOUTH WALES)
Mr. Coleman: On a point of order, Mr. Speaker. During Welsh questions and subsequently, as a result of the application under Standing Order No. 9 by my hon. Friend the Member for Swansea, East (Mr. Anderson), we have had several references in the Chamber to the enormous number of job losses which will occur in the steel industry in South Wales, where the number will be greater
54
than in any other part of the United Kingdom.
My point of order, Mr. Speaker, is this. In view of the anxiety which is being created among people in South Wales, may the House he told whether there has been any request from the Secretary of State for Industry to make a statement on the situation in the House today?
Mr. Speaker: First, the hon. Gentleman's point of order is absolutely in order. The answer is that I have not received such a request for any statement to be made.

STATUTORY INSTRUMENTS, &C.
Mr. Speaker: With the leave of the House, I shall put together the two Questions on the motions relating to statutory instruments.
Ordered,
That the Sea Fish Industry Act 1970 (Relaxation of Time Limits) Order 1979 be referred to a Standing Committee on Statutory Instruments, &c.
That the Fishing Vessels (Acquisition and Improvement) (Grants) (Variation) Scheme 1979 be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. St. John Stevas.]

ORDERS OF THE DAY

  NATIONAL HERITAGE BILL
  Order for Second Reading read.
  4.37 pm
  The Chancellor of the Duchy of Lancaster and Leader of the House of Commons (Mr. Norman St. John-Stevas): I beg to move, That the Bill be now read a Second time. I am delighted this afternoon to ask the House to give a Second Reading to this important Bill. Long after the political controversies which loomed solarge in the contemporary consciousness have been forgotten or consigned to the bound volumes of Hansard, than which there can be no deeper oblivion, the effects of this measure will still be felt. It will be alive and vital and still bearing fruit. The fund will be a vehicle by which successive Governments will be able to show their concern and their care for our heritage.
  I am glad that this is a Bill which carries all-party support, but it is particularly appropriate that it should be introduced by a Conservative Government, because of the name of our party and because the Bill fulfils our direct manifesto pledge on this matter.
  I offer my congratulations to my hon. Friend the Member for Stafford shire, South-West (Mr. Cormack), who has done so much by spoken word and by pen, on his contribution and to the hon. Member for Warley, East (Mr. Faulds), who has been such a doughty champion of all forms of the arts.
  We should, of course, all have liked a greater amount of money for the Bill, and it would, indeed, have been available had not the Public Accounts Committee—most unfortunately, in my view—recommended in 1957 that the old National Land Fund should be reduced to £10 million, that recommendation being later enacted by Act of Parliament. But we cannot undo the past, and it is much better to get something started with modest sums than to wait for the day, which may never dawn, when great sums become available.
  That, at any rate, is the policy which I intend to pursue throughout the arts, and
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  it is, I believe, one which will be supported by all but the most unreasonable or the most idealistic.
  We wish to keep all major projects going and to start new ones on a modest basis so that, when better economic days dawn, they can grow to greater stature.
  The Bill is the joint responsibility of my right hon. Friend the Secretary of State for the Environment and myself, but as it is a United Kingdom measure it concerns also my right hon. Friends the Secretaries of State for Scotland, for Wales and for Northern Ireland, and, as certain responsibilities are being transferred to my right hon. Friend and myself, my right hon. Friend the Chief Secretary to the Treasury also is concerned.
  When I was given responsibility for the arts, as the first Cabinet Minister to have that responsibility, my first task in that capacity was to set up the new Government department of the Office of Arts and Libraries. My second main task, once the department had been set up, was to prepare the Bill. The principal proposals in the Bill are ultimately derived from the third report of the Select Committee on Expenditure of the 1977–78 Session on the National Land Fund. Valuable lessons were learnt in the discussions that took place while the Sub-Committee was taking its evidence and after the report was published in the summer of last year.
  The first lesson was that changes were needed in the way in which the resources available to the Government for the preservation of the national heritage were administered. The second lesson was the need to modify the role of Treasury Ministers in relation to the heritage policy. The third lesson was that the operation of the system under which property is accepted in satisfaction of capital transfer tax and estate duty, and the function of the National Land Fund in those arrangements, was obscure and should be clarified.
  The Bill is evidence that those propositions have been accepted not only by the heritage movement but by all the Ministers on the Treasury Bench. I pay tribute to the Environment Sub-Committee for its report on the National Land Fund. The report, and the store of evidence associated with it, constitutes a thorough and enlightening expose of the system for accepting property in lieu of estate duty.

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  The main recommendation of that report was that the National Land Fund should be converted into a new fund under independent trustees, to be used to help in the preservation of outstanding elements in the national heritage That is the main purpose of the Bill.
  Mr. Tam Dalyell): I simply wish to ask a factual question. Is the £15 million that is expected to be in the National Land Fund net, or does it include any property that may have been left in lieu of death duties or other tax requirements?
  Mr. St. John-Stevas: Perhaps I may deal with that point when I come to the financial provisions of the Bill.
  The Bill has three main purposes: first, to set up the fund that I have just mentioned; second, to transfer the responsibility for the system of acceptance of property in satisfaction of tax from the Treasury to my right hon. Friend the Secretary of State for the Environment and myself, and to abolish the National Land Fund; third, to provide the vires for a scheme under which the Government can compensate certain institutions for the loss to, or damage of, items that they loan from their collections to certain other classes of borrowing bodies and persons.
  Part I of the Bill establishes the National Heritage Fund, to be vested in, and administered by, independent trustees appointed by my right hon. Friend the Secretary of State for the Environment and myself. The role of the trustees of the new fund will be essentially a supporting one. They will be there to assist others. The basic concept is that the existing institutions, museums and galleries, libraries, preservation trusts, the great National Trusts of England and Wales and of Scotland and similar bodies will continue to be responsible for decisions on whether to seek or acquire particular property.
  The initiative will lie with them in deciding whether to acquire. When looking around for funds, they will be able, in cases of outstanding importance to the national heritage, to obtain assistance from the National Heritage Fund. Where an institution has funds of its own—such as the purchase grants-in-aid that the national museums and galleries are annually voted by Parliament—
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  the National Heritage Fund trustees will be entitled to expect that institution to make a contribution towards the purchase and, where appropriate, to seek support from other grant-giving bodies. Those bodies supported by local authorities and universities will be treated similarly, although the particular circumstances of the case will effect the proportion that the trustees decide to cover. We must recognise that the National Trusts and many local ad hoc trusts have little or no resources available for acquisition or maintenance. Therefore, the trustees may have to consider making 100 per cent. contributions in those circumstances.
  Under the Bill, the trustees are enabled to assist those bodies that are administered by Government Departments, such as the Science museum, the Victoria and Albert museum and the Royal Scottish museum. It would be absurd to deny access to the fund to those bodies in cases that were otherwise appropriate. Of course, it is for the trustees to decide whether they could afford to make their scarce resources available.
  The Bill will also enable the trustees to assist Ministers in their capacity as acquirers and preservers of ancient monuments and historic buildings.
  Mr. Alan Clark: Perhaps my right hon. Friend intends to enlarge upon this point later, but in whom is vested the final decision to acquire or reject? As I understand the Bill, that power of decision is vested in the Secretary of State for the Environment and in my right hon. Friend. In other words, the decision is highly subjective. Although we all have confidence in the Minister's taste and perception, his right hon. Friend's obsession with practicality is such that he might be compared with the late Duke of Windsor, who thought that Graham Greene was a golf course. The varieties of taste and perception that may attach to particular Ministers may be a source of danger.
  Mr. St. John-Stevas: As I understand the Bill, the decisions are to be taken by the trustees. The recommendation that grants over a certain amount of money should be referred to Ministers is not implemented in the Bill. We intend that those trustees should be genuinely independent and that intervention of Ministers

  59
  will be reduced to a minimum. The trustees will have a large degree of independence. It is for them to devise a working definition of the national heritage. They will be obliged to take expert advice before reaching any decisions, but they will be free to seek that advice where they wish. They will get their grants-in-aid, like the national museums and galleries, in one lump sum at the start of the financial year and not by the drip-feed method of most grant-aided bodies that are paid in instalments and have to prove the need for each new instalment.
  They will also be free to accept private gifts and bequests. Those will not be subject to control by the Treasury, but they will be subject to the general provisions of the trustee investment legislation. They will be fully accountable to Parliament through the Ministers who appoint them and through the Comptroller and Auditor General, who will audit their accounts. It follows from my previous remarks concerning their supporting role that they will not be able to acquire property in their own right, except with the express permission of Ministers. There is no intention that they should form their own estate or picture collection in competition with existing institutions.
  Although they will have freedom of manoeuvre as I have described, it will be open to Ministers to give them guidance on their work. That applies in particular to the conditions of grant and financial memorandum that are issued to grant-aided bodies and also in the discussions and correspondence that such bodies normally have with Ministers from time to time. They will, of course, have to take into account any views expressed from time to time in Parliament on their work.
  The Environment Sub-Committee attached some importance to the method of appointment of the trustees. It is the standard practice for the Ministers responsible for a policy area to be responsible for the appointments to bodies in that area. The authority of the Ministers concerned would otherwise be diminished. However, the appointment of the chairman will be subject to the Prime Minister's approval. It is vital that this body, charged with the handling of a large new sum of public money that
  60
  will affect and in part determine the cultural heritage that we transmit to posterity, should be equipped in ability and experience to meet that challenging task.
  We shall be looking for a group of what I call cultured generalists, reflecting the whole British heritage, rather than experts in particular fields. Contrary to reports in the press, no decisions on appointments have yet been taken.
  Mr. Andrew Faulds: What a relief.
  Mr. St. John-Stevas: It would be inappropriate even to consider them until the House had given a Second Reading to the Bill.
  The trustees will be served by a small secretariat, the costs of which will be met from the grant-in-aid. Although the Bill makes no explicit provision for a particular date but leaves the Act to be brought into force by a statutory instrument, we hope to be able to set up the fund with effect from 1 April 1980.
  Part II of the Bill deals with the system of acceptance of property in satisfaction of capital transfer tax and estate duty. Our decision to maintain that provision, which the previous Administration wished to abolish, was announced by me before the general election after consultation with the then Shadow Chancellor of the Exchequer.
  The Bill fulfils our commitment to maintain intact the existing system, subject to two necessary qualifications. First, it was necessary to abolish the National Land Fund and, secondly, the ministerial responsibility for the system is to be transferred from the Treasury to my right hon. Friend the Secretary of State for the Environment and myself.
  I should briefly explain to the House the operation of the acceptance-in-lieu system. Anyone who has capital transfer tax to pay, typically as the executor of an estate, may offer certain property to the Inland Revenue in satisfaction of the tax. That property could be land or buildings, together with the contents—works of art and other collectors' items—and the property must pass a stringent quality test.
  The Treasury takes the advice of expert advisers on the quality and valuation of the property offered. If it is accepted, the

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  value of the property, which would not be liable to tax, is set against the amount of the tax liability. When the property is accepted by the Inland Revenue, it is reimbursed from the National Land Fund for the tax it forgoes. The fund is to be abolished and the Inland Revenue will in future be reimbursed from Votes.
  Section 50(2) of the Finance Act 1946 declares:
  "The Treasury may, if they think fit, direct that a sum equal to the amount of the duty…shall be paid to the Commissioners".
  The permissive form "may" is repeated in clause 8(1) of the Bill, which provides that Ministers may pay to the commissioners a sum equal to the tax. We have tried to make the minimum necessary change in the existing system, but I must make clear that the Government remain, fully committed to the principle and the practice of reimbursing the Inland Revenue which has applied since 1911. Reimbursement will continue.
  The decisions on whether property should be accepted, which has hitherto been taken by Treasury Ministers, are to be taken under the Bill by my right hon. Friend the Secretary of State for the Environment and myself. The decisions have always been taken on expert advice. That will continue to be the case.
  Where the property comes from a Scottish, Welsh or Northern Irish estate, the lead will be taken by the appropriate territorial Minister. Where it involves land or buildings in England, it will be a matter for my right hon. Friend the Secretary of State for the Environment and where it involves objects in England, it will be for me.
  We shall work in full consultation and we shall co-operate in order to ensure consistency of standards. The ultimate responsibility for the decisions and the payments to the Inland Revenue will lie with my right hon. Friend the Secretary of State for the Environment and myself jointly.
  Mr. Dalyell: May we stick on Clause 8, which says that Ministers "may" pay the Commissioners of Inland Revenue? Can it be taken that that means that trustees must pay the commissioners if they are to accept a property in satisfaction of a tax? That is a crucial point which should be clarified.
  Mr. St. John-Stevas: The duty under clause 8 as regards payment or ability to pay is laid firmly in the in-lieu procedure on the Ministers concerned. It is permissive and does not concern the trustees at that point. As I have indicated, it is a permissive power, but I have stated firmly that it is the Government's intention to continue with the existing practice. That is in accordance with our pledge.
  Mr. Michael Morris Mr. Michael Morris (Northampton, South) rose—
  Mr. St. John-Stevas: The Environment Sub-Committee report showed that the criteria that the expert advisers were asked to apply were, particularly in the case of works of art, not always easy to apply. The report recommended that they should be clarified and that the burden of advice should not fall, as at present, on the shoulders of a single person, however distinguished.
  The Treasury has taken the advice, in such cases, of the director of the appropriate national museum or gallery, and, although the directors are free to consult other experts, they alone are answerable for their advice. I am considering the best method of improving the present system, which, I accept, places a considerable burden on a single individual.
  May I say two things in clarification of the quality test? First, I shall be asking whoever is called upon to give advice under the new arrangements to consider, where appropriate, the desirability of leaving works of art in the country houses or other locations with which they have become associated. Secondly, the policy that has applied since 1972 of encouraging the acceptance of items that would be pre-eminent additions to local museum collections will be continued.
  It may be convenient if I explain in more detail the financial provision proposed by the Government for the National Heritage Fund and the acceptance-in-lieu arrangements. The National Land Fund is expected to have standing to its credit at the end of the current year about £15½ million. When the fund is wound up, an equivalent amount will be made available in the financial year 1980–81, divided between the National Heritage Fund and acceptance-in-lieu.

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  In deciding on the precise division of the £15½ million between the two, we shall have to take account of the number of acceptance-in-lieu cases known to be in the pipeline or on the horizon. There are also some cases where property recently accepted in lieu of tax will require further expenditure or maintenance before it can be disposed of. That will be a further call for the next year or so on the sums allocated to acceptance-in-lieu cases.
  Although a precise allocation is not possible at this stage, I can say that the new fund will have upwards of about £12 million in its first year. That will be in the nature of an endowment and it is not expected that the whole sum will be used in the first year or even the first few years. The balance will earn interest for the trustees.
  In later years, the planned expenditure, at 1979 Public Expenditure Survey Committee prices, is £5½ million a year on the fund and acceptance-in-lieu cases. As with other public expenditure programmes, that sum will be revalued from year to year and the precise allocation between the fund and acceptance-in-lieu cases can only be decided nearer the time.
  The grant-in-aid for the fund and the reimbursement to the Inland Revenue will both be borne fifty-fifty on the Votes of the Department of the Environment and the Office of Arts and Libraries. Of course, if a really big house or other piece of property came along for consideration either by the trustees of the fund or for acceptance in lieu of tax and it exceeded, or would unacceptably deplete, programmed expenditure, the Government would have to consider whether it would be possible to make the necessary funds available.
  Similarly, if several smaller but still significant cases all came along at once and it was not possible to accommodate them all, the Government would again have to consider whether savings from elsewhere in planned expenditure could be realised for that purpose. I must stress that the Government are not inflexible in these matters, but we cannot give an open-ended commitment.
  I turn to part III of the Bill, which deals with indemnities. There are two
  64
  fundamental principles at issue here. First, the borrower, as a rule, undertakes to compensate the lender for loss of or damage to what he borrows and undertakes to pay any insurance or other costs arising. Secondly, the Government carry their own risks, as do bodies which are wholly or mainly supported by moneys provided by Parliament. Therefore, when the owner of a work of art lends it to a national museum or gallery, the latter undertakes the contingent liability to compensate the owner for loss or damage, but does not need to insure. However, when the Government or a national museum or gallery lends property, the borrower is normally required to insure. Of course, there have been exceptions to this rule. A current example, which we heard about earlier this afternoon, is the Royal Academy Post-Impressionist exhibition. The Government have accepted that this exhibition is so important that they will stand in place of the borrower—in this case, the Royal Academy—and carry the risk themselves.
  Over the years it has been represented to Governments of both parties that many items in national collections, in store or on restricted display, could be displayed to advantage at regional institutions if only the Government would accept the risk of loss or damage. It was argued that the insurance costs which fall on local authority or university museums were inhibiting those institutions from borrowing much that the national institutions would otherwise have been ready to lend. This argument was accepted, and on an extra-statutory basis the Government have, since 1977, been accepting the liability in approved cases where such loans have taken place.
  This Bill provides the opportunity to place this extra-statutory arrangement on a statutory basis. We have taken the opportunity to widen the scope of the arrangement so that it will apply to loans to university libraries, the National Trust and other approved bodies and persons. We hope that this will facilitate the loan of items which have come into the ownership of national institutions back to the houses with which they have been associated in the past, or to comparable houses. More generally, it will facilitate a wider display to the public of property which is owned by the public.

  65
  It has been suggested that the Government should go further than this and take over the liability for items which are loaned by one local authority or university museum to another or by a private individual to a local authority or university museum. Clause 17 of the Bill provides for this in the special case where the object in question has been refused an export licence and is displayed in such an institution in the hope of raising funds for its purchase and retention in Britain. In such cases, the Government, by withholding an export licence, have established a clear locus in the matter, and it is reasonable that they should take on the risk involved. But it is debatable whether the Government should take on this liability in other cases where the matter is essentially between bodies and persons who are unconnected with the Government and who derive benefits from the loan for which it is arguable that they should incur the corresponding costs. I shall listen to hon. Members' arguments on these points.
  For the benefit of the House, I shall run quickly through the Bill clause by clause. Clause 1 provides for the establishment of the new fund and for the trustees of the fund who are appointed by Ministers—the Secretary of State for the Environment and myself. Schedule 1 provides more detail on the trustees. The fund itself will not qualify for charitable status, but it is intended that it will be exempt from tax on its income and on its capital gains, and it should enjoy the rate relief which charities enjoy.
  Paragraph 2 of schedule 1 provides the appropriate relief from local authority rates. The appropriate reliefs from Inland Revenue taxation will be provided in next year's Finance Bill and will apply from the beginning of the life of the fund.
  Mr. Dalyell: There is the question of the circumstances in which the Secretary of State for Scotland is an appointing Minister. This is considered to be a matter of some substance north of the border. I hope that the position will be clarified.
  Mr. St. John-Stevas: I shall certainly ask my hon. Friend the Under-Secretary of State for the Environment to make a further statement on the matter when he replies to the debate. I have indicated the role of the Secretaries of State in regard
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  to Scottish, Welsh or Northern Irish properties, which is a different point. As I understand it, there will be an opportunity for a trustee to be appointed by the Secretaries of State concerned or upon their advice.
  Clause 2 provides for payments to be made into the fund by the Ministers within a month of the beginning of the financial year, and for the trustees to pay any receipts they may have into the fund as well.
  Clause 3 contains the main power for the trustees to make grants or—subject to Treasury consent—loans to eligible recipients who are listed in subsection (6) for the purpose of assisting them to acquire, preserve or maintain property of importance to the national heritage. The provision as to expert advice is in subsection (2). It is also provided in subsection (5) that the trustees can lay down conditions for their assistance.
  Clause 4 enables the trustees to spend money from the fund on connected purposes—for example, incidental expenses such as transport, to the acquiring body, or necessary repair before disposal—and on the acquisition of property themselves; but subsection (3) provides that they can acquire property themselves only to the extent permitted by Ministers. We do not envisage the trust fund as a permanent holding body. I suspect that the trustees will find so many claims pressed upon them that they will be chary of spending much of their resources in this way.
  Clause 5 enables the trustees to accept gifts of money or other property. Of course, it is a central part of our arts policy to encourage private patronage and sponsorship of the arts. I hope that this new fund, quite apart from its public support, will attract considerable private support also. It is intended to provide in next year's Finance Bill that gifts and bequests to the fund will be wholly exempt from CTT and CGT.
  Mr. Martin Stevens: I am sure that the House welcomes what my right hon. Friend has said about private support for the fund. Has he given thought to the recognition which might be afforded to corporations and institutions which give that support? While they may not necessarily seek advertisement, it is obviously desirable that they

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  should be seen to be helping the fund and should not be expected to help anonymously.
  Mr. St. John-Stevas: I think that recognition in full should be given, and, if it is not, it should be claimed by the firms concerned. That will have some repercussions in the tax system as well. I shall bear that important point in mind. Recognition in every meaning of the word should be afforded to anyone who gives anything to the fund, including the Government.
  Clause 6 deals with the powers of investment of funds that are not immediately needed. That is an important clause. Clause 7 provides for an annual report and accounts.
  Part II of the Bill is complicated by the need to refer to and amend a vast corpus of existing tax legislation. The main operative provision remains paragraph 17 of schedule 4 to the Finance Act 1975.
  Clause 8 provides that, where property is accepted in satisfaction of tax under this paragraph, the Ministers, instead of the Treasury as at present, may reimburse the Inland Revenue for the tax forgone. I have already made it clear how we intend to apply that provision. Clause 9 gives the Ministers control over the disposal of property accepted in satisfaction of tax. Clause 10 provides that when property is accepted in satisfaction of tax, receipts and expenses in respect of the property are paid to or by the Ministers.
  Mr. Dalyell: With regard to clause 9, will stamp duty exemption extend to private treaty purchases made by the fund or to those bodies that it assists with grants? I do not expect the right hon. Gentleman to answer off the top of his head, but it might save a lot of time if some answer could be given.
  Mr. St. John-Stevas: I am perfectly willing to answer off the top of my head, but experience has taught me that it is not always the safest course to adopt. I shall refer to the experts on this matter, and we shall endeavour to convey the information during the course of the debate.
  Clause 11 exempts from stamp duty conveyances or transfers made under
  68
  clause 9. Clause 12 transfers to the Ministers the responsibility for various decisions which now lies with the Treasury. Clause 13 makes it clear that property can be accepted in lieu of interest on CTT and estate duty as well as in lieu of the CTT or estate duty itself. This is already done in practice and the clause simply clears up a doubt about the interpretation of the existing legislation. Clause 14 provides that if at some future date it is decided to transfer on to the trustees the functions now being transferred from the Treasury to my right hon. Friend and myself, this can be done by Order in Council subject to affirmative resolution of both Houses. Clause 15 simply provides for the abolition of the National Land Fund.
  Clauses 18, 19 and 20 make provisions for receipts and payments, entry into force of the Bill and interpretation, repeals and territorial coverage.
  Part III deals with indemnities. Clause 16 deals with the schemes covering loans by national institutions to other bodies. The national institutions are listed in schedule 2 on page 13, and there is a power in subsection (3) to add to the list by statutory instrument if new bodies are created or if some which are at present not included, such as the Ministry of Defence museums, are later included. The list of eligible borrowing bodies is in subsection (1) and includes a very wide residual category for various types of body which might occasionally use the facility. Clause 17 deals with the power to grant an indemnity in cases where an export licence is withheld.
  Hon. Members on both sides of the House will realise that the Bill, while simple in principle, has a number of complex and technical points, but I think that it is more advisable to pursue these in detail in Committee rather than on the Floor of the House. Although it is not a measure that is politically controversial, there will be some aspects that will have to be argued out thoroughly.
  In the protection of our national heritage, we already have a powerful array of weapons and institutions. On my side, that is the Office of Arts and Libraries, we have the national and local museums and galleries—nearly 1,000 in all—the Standing Commission on Museums and Galleries, which is a constant source of wise

  69
  and valued advice, and the Reviewing Committee on the Export of Works of Art, with its advisory council. In addition, we have the acceptance-in-lieu system, which we are now improving in the Bill, and the other tax reliefs, private treaty sales to public sector institutions and conditional relief from capital transfer tax for items placed on display to the public.
  Now we are adding this powerful auxiliary fund, the main function of which will be to supplement existing resources and to deploy its own resources in the most critical situations. We are also widening the scope of the Government indemnity. I believe that with this Bill we shall have placed our national heritage in a far more secure position than it has ever enjoyed before.
  When our proposals were originally announced in September of this year, they were hailed by Mr. Hugh Leggatt, who has done so much for the preservation of our heritage in Britain, as the brightest day for the arts and the heritage in this country for more than 30 years. That was a generous tribute, which, coming from such a source, was extremely welcome. I believe it to have been no exaggeration.
  What has for so many years been a dream of visionaries and enthusiasts is about to become a reality. It is a measure of the importance that the Government attach to the preservation of our heritage that, despite all the pressures for the reduction of public expenditure which the Government are quite rightly exerting, they have found room for the extra investment needed in this area. It is not an extravagant beginning, but it is not a derisory one either.
  "Tall oaks from little acorns grow."
  I believe that in future the branches of this fund will spread over the heritage ever more widely, protecting it from the economic storms and changes that make it especially vulnerable.
  I recall the even more modest beginnings of the National Trust, which has now become one of our great national institutions known throughout the world for its skill and sagacity. The National Heritage Fund is set to follow along that successful path. If I may be allowed a personal reflection, I feel that had I done nothing more than introduce this Bill my tenure of the office of Minister with res-
  70
  ponsibility for the arts would have been justifiable and worth while.
  5.16 pm
  Mr. Andrew Faulds: What can I say, except to greet warmly the introduction of the Bill—[HON. MEMBERS: "Well done."] Wait for it. It is not often—indeed, in this Parliament it is exceptional, probably unique, that we in Opposition can positively welcome any legislative intention from this benighted Government. Why should we not welcome the Bill? Recognition of one's offspring is an ordinary and expected paternal reaction. We, of course, can make a claim to paternity of this welcome little bundle.
  After all, its swaddling clothes were the Labour Government's White Paper of February 1979, and it was the Labour Government of my right hon. Friend the Member for Cardiff, South-East (Mr. Callaghan) who slapped it into life. The Chancellor of the Duchy of Lancaster is simply, by electoral chance, and with no procreative effort, standing in loco parent is. Although he has the satisfied smirk of a fond father, it was not his brat originally. We have a longer lineage to claim—
  Mr. Patrick Cormack: The grandfather.
  Mr. Faulds: The hon. Gentleman has put me right on the dot. The grandparent of this measure was a previous Labour Chancellor, Hugh Dalton, whose healthy conception—the Land Fund—was stillborn by the machinations of earlier Treasury operatives.
  The Chancellor of the Duchy was uncharacteristically less than generous, although he said nice things about me, in his account of the genesis of the Bill. I want to get the record straight, so I trust that the House will excuse me for an introductory word or two on its history. Perhaps I can recall, because it is important that we should go back to the beginning, Hugh Dalton's words when establishing the Land Fund at £50 million in April 1946. He said:
  "It is surely fitting, in this proud moment of our history, when we are celebrating victory and deliverance from overwhelming evils and horrors, that we should make through this fund a thank-offering for victory, and a war memorial which, in the judgment of many, is better than any work of art in stone or bronze."—[Official Report, 9 April 1946; Vol 421, c. 1840.]

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  Then, of course, Hugh Dalton was thinking of saving aspects of the British landscape. Heretofore, that purpose of the fund has been largely neglected. Now, we must keep it in the forefront of our minds. I hope that the Minister will do that.
  In a too little regarded letter to The Daily Telegraph, the national president of the Royal British Legion, Sir Charles Jones, wrote in his concluding sentence:
  "I therefore urge MPs to recall the principles, accepted by all political parties, on which the National Land Fund was founded".
  What subsequently transpired on the Land Fund was that, in 1957, the Government, at the urging of the right hon. Member for Down, South (Mr. Powell)—who, I notice, is not in his seat as I should have expected him to be when we are debating a matter such as this—reduced the fund, which the right hon. Gentleman considered to be inert and non-existent, from £50 million to £10 million. The Minister has also made reference to this matter. Thereafter, the principle on which it was founded was lost from public view. I mention the right hon. Member for Down, South in that connection not to immortalise him in this important debate but to put the blame on the Conservative Party, where the responsibility properly lies for that deprivation, however much the right hon. Gentleman plays with words about conservation. The sooner the record of the right hon. Member for Down, South, in all its aspects, is forgotten, the better for British political life.
  The proper purpose of the fund fell into desuetude. It was only the tragedy of Mentmore that highlighted the sad problem as a matter of public and parliamentary concern. Lady Birk suffered a desolating experience—as did all of us who care about the heritage—with the sale of Mentmore. That brought about her resolution to change the whole set-up. She established an interdepartmental group to study the problems and to put them to rights. The House set up a Committee which was admirably chaired by our now retired colleague, Arthur Jones. That Committee reached a number of conclusions as to how matters in the area of conservation of the heritage should best be pursued.
  The previous Labour Government issued their White Paper in February
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  1979. The right hon. Gentleman will have to agree that this legislation is based pretty precisely on that White Paper with the exception—before the right hon. Gentleman intervenes—of the retention of the in-lieu procedures. So let us give credit where it is due—to my colleagues in the other place, Lady Birk and Lord Donaldson. They took up cudgels on behalf of the heritage and, with the positive support of the then Prime Minister, brought the Bill to light. The vagaries of electoral choice have now presented the Bill to the right hon. Gentleman on a parliamentary platter.
  Mr. St. John-Stevas: We are all subject to the vagaries of electoral choice. I had no intention of withholding a tribute to anyone. However, I thought that the tribute to the hon. Gentleman subsumed the other, lesser, luminaries to whom he referred—the greater light included the lesser one. With regard to the responsibility for the Act of Parliament and the reduction in the old Land Fund from £50 million to £10 million, that was an act of a Conservative Government. However, it was recommended by an all-party Public Accounts Committee with a Labour Party Chairman. I do not wish to be contentious about the matter. We all have responsibilities, for good or for evil. However, I claim this credit for the Government in this respect—which was given to us fleetingly by the hon. Gentleman—that what prejudiced the whole scheme was the insistence of the previous Government on abolishing the in-lieu proceedings. The fact that those have been retained has enabled us to launch the scheme in what Matthew Arnold called an atmosphere of "sweetness and light".
  Mr. Faulds: I have only two comments to make on that. With my natural modesty, I could not consume all the credit and I tried to put that right. Whatever the right hon. Gentleman tries to say, it was a Conservative Government and it was the right hon.—odd phrase, in his case—Member for Down, South who deprived the Land Fund of those moneys.
  Let us look at the Bill in some detail. In clause 1(2) the definition of Ministers, who figure so largely in the provisions of the Bill, is given as:
  "the Secretary of State and the Chancellor of the Duchy of Lancaster".

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  I imagine that the generic term "Secretary of State", without specifying the Department of the Environment, is the normal form used in legislation so that if the title of the Department changed in future no change is necessary in the statute. Nevertheless, the Chancellor of the Duchy of Lancaster is in a somewhat different league. The historic title is unlikely to be changed. The duties that go with the title, other than those of the Chancellor ship proper, can and do change regularly. The right hon. Gentleman's office figures in the Bill only in so far as he himself is the Minister responsible for the arts. Incidentally, that responsibility is to be found on his notepaper, and I am glad that he makes that boast.
  Sadly, the right hon. Gentleman is not immortal. Such responsibility may be transferred in the future to, for example, the Lord Privy Seal or—sadly in a doubtless more remote future—the arts might be promoted to a Secretary of State ship of their own. Thus, the argument of flexibility which validates the generic character of the first definition would invalidate the second, which is too specific. Consequently, in order to give greater flexibility to the second definition, would not the right hon. Gentleman consider the possibility of adding, after the mention of the Chancellor ship of the Duchy of Lancaster, the words:
  "as Minister responsible for the arts"?
  That might clarify the matter a degree or two.
  The matter of the financing of the fund, which transpires in the third page of the explanatory memorandum, calls for comment. The proposal is to pay to the new National Heritage Fund the equivalent of the capital balance standing to the credit of the National Land Fund at the moment of its abolition. But the proposal includes denying the new fund its first year's income. As a consequence, for one year, the new fund will be compelled to fall back on the consumption of its capital. When we reflect on that sad passage in 1957, when Parliament was induced, on more or less false pretences, to sanction the cancellation of about £50 million of the original capital of the Land Fund, the present small-minded and niggardly proposal amounts to adding
  74
  gratuitous insult to gross injury. Not only that, but provision is being made for the assets of the new Heritage Fund to be raided for purposes which are nothing whatsoever to do with its proper function and purposes. I shall return to that matter in a moment or two.
  Even with the National Heritage Fund set up with about £16.3 million from the National Land Fund and the £5½ million that will be put in each year, there will, on occasion, be a need for special provisions. The right hon. Gentleman made reference to that fact. If, for instance, a major house has to be bought in to save our heritage, we could be talking in terms of about £20 million. There must be a responsible attitude to a contingency fund. Can we really expect this Cabinet of—I do not wish to be too discourteous—philistines, in which the right hon. Gentleman is a lonely lost figure, to fork out that sort of figure to retain our heritage?
  I turn to part II of the Bill, which deals with property accepted in satisfaction of tax. I warmly congratulate the right hon. Gentleman on his success in preserving in principle this valuable protection of our heritage. I, myself, argued against the proposal to abolish it after the matter had been sprung on the art world earlier this year without the slightest consultation with the museums. It is ironic that certain former Ministers who were most intimately concerned with this matter—they do not sit a million miles away—were equally in favour of preserving the system. I put that fact on the record. However, they were neutralised by the entrenched opposition of the Treasury and the stonewallers of Whitehall. I am glad that the right hon. Gentleman has broken through that resistance. Although the right hon. Gentleman's adamantine stand is much to be welcomed, I hope that he does not fool himself that he has as yet completely won the contest.
  To return to my earlier animadversion—and I made reference to this earlier—clause 8 seeks to satisfy the appetite of the Commissioners of Inland Revenue to enter a figure in their accounts equivalent to the capital transfer tax, satisfied by the acceptance by the State of property surrendered to it in kind.

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  What will occur is that there will be a demand for a sum to be voted by Parliament from the Consolidated Fund—that is, from money raised from the generality and generosity of taxpayers—to be paid to Ministers but which is not to be spent outside the public sector, and can only be paid to the commissioners in order to offset a payment received in kind. I think that the popular description of that would be having one's cake and eating it.
  Once this sum reaches the commissioners, they have no option but to treat it as if it had been newly raised from taxation—whereas, of course, it comes from funds from which taxpayers have previously been parted—and pay it into the Consolidated Fund, from which it originated in the first place. I believe that the right hon. Gentleman understands that matter.
  I wonder, and, indeed, the House should wonder, whether the Public Accounts Committee might not look askance at such a raid for such a purpose on the Consolidated Fund, made on the pretext that, even if it does not actually constitute public expenditure, it ought to do so, and accordingly it must be treated as such, albeit notionally.
  These are cloud-cuckoo-land calculations—and I am carefully weighing my words today—with which the Treasury confuses and confounds interested and concerned parties. Can the country afford the frustration of such fatuous nonsense and lack of proportion when our cultural heritage is at stake? I remind the House that the French, when taking over the idea of acceptance-in-lieu that we pioneered, had the common sense to treat it as payment in kind, not involving public expenditure, and to record such transactions in the ledgers merely in terms of units of account—in that case no doubt in francs.
  The truth is that acceptances in lieu of tax merely betoken the agreement of the State not to insist, in selected cases, on receiving cash from the sale of certain objects. In short, the State refrains from raising revenue in cash in certain instances because it recognises the existence of a competing national interest—the preservation of our cultural heritage.
  There is no valid reason, except that it will be a novel step, for rejecting a system
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  analogous to that established in France. It would be totally misleading to imply that the adoption of any such method would amount to an open-ended commitment outside the control of Ministers and Parliament. That is simple nonsense. On the contrary, the quantity of units of account expressed in sterling, or the total of licences to "write off", or whatever one calls them, could be made available to Ministers each year by means of statutory instruments laid before Parliament for approval, whether positive or negative. The advantage of that for the preservation of the heritage is that the cultural interests of the country would be considered strictly on their merits and not obscured by other considerations.
  Instead of that, what do we get in clause 8(1)? The Ministers may pay this conventional tribute of taxpayers'money—that is, they have the discretionary power to pay it or not pay it. However, in clause 8(2) it is stated that the commissioners shall deal with those sums as if they were payments on account of capital transfer tax, which they are accordingly recognised not to be. That is to say, the commissioners are subject to a mandatory injunction, which accurately corresponds to the real situation and would be equally valid in dealing with units of account expressed in sterling.
  One of the most striking and pernicious demerits of the Bill is the attempt to confuse the real money, if I may call it such, and consequently real public expenditure, represented by the annual grants made outside the public sector to the Heritage Fund trustees, with the phoney money circulating inside the public sector, which is employed for accounting purposes in connection with the in-lieu acceptance and which does not involve genuine public expenditure.
  That improper conjunction of two different species may be spied from the statement on the third page of the explanatory memorandum, which reveals that both payments, the genuine and the false, are likely to be lumped together in one Vote to the Ministers. However, the effect is likely to be that unless the grant to the heritage trustees is kept entirely independent, as it clearly ought to be, there will always be a danger that the more of this totally arbitrary cake that

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  is devoted to the one category, the less will be available for the other. The right hon. Gentleman was good enough to be frank and honest about that.
  Just as the heritage trustees might be reluctant to be a cause of the exclusion on faked financial grounds of the acceptance of some desirable items in lieu of tax, so testators, having such items, might be reluctant to be a cause of reducing or even perhaps eliminating the annual grant of genuine money for the Heritage Fund, which ought to be fixed independently each year.
  The unjustifiable confusion between these two totally disparate functions will, indeed, prove a perfect recipe for controversy in the future. I warn the right hon. Gentleman of that outcome. Cynics may be inclined to suspect that to be an object of the exercise, on the old principle of divide and conquer, and they are probably right. Perhaps the Minister will enlighten us on those matters a little later.
  The fact that I emphasised earlier, that the questionable payment to the Inland Revenue is discretionary, may be accounted for on the grounds that it has always been so in the past. But here I want to pose an intriguing question.
  Mr. St. John-Stevas: The hon. Gentleman will, in fairness, note that the administration of the in-lieu procedure and the fund have been separated in the Bill. There were some who counselled against, but it is an important point that, although the money is coming from a common source, the administration of it is being kept separate. One is being done by the Ministers and the other by the trustees in order to reduce any degree of confusion.
  Mr. Faulds: Even though that may be true, it does not lessen the force of the argument that we are talking of certain limited sums having to be spent in two different directions.
  Mr. St. John-Stevas: That is right.
  Mr. Faulds: I am grateful to the right hon. Gentleman for admitting that, and that is the force of my argument.
  I wanted to pose a question. What happens if a testator—I cannot think of any names but there are some very testy testators for all their public-spirited intent—should offer highly desirable items in
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  satisfaction of tax on condition that the Ministers exercise their statutory discretion to make no such payment? That is a serious question and I should like to have a serious answer from the Minister. It is a situation that may arise.
  Clause 9 deals with the disposal of property accepted in satisfaction of tax, and the drafting of that clause is not as clear or consistent as it should be. Subsections (2), (3) and (4) appear to deal with buildings, their contents and land, leaving only subsection (1), which has a very general power, to cover chattels—that is, works of art and so on. However, chattels constitute and will continue to constitute an exceedingly important aspect of the whole system.
  Subsection (2) conveniently refers back for definition purposes to clause 3(6)(b), which would cover such bodies as the National Trust, but somewhere in clause 9 there should be a reference back to the definition in clause 3(6)(a), which covers museums. At the same time the opportunity should be taken to specify the National Art-Collections Fund, so frequently cited in past statutes, and the Friends of the National Libraries, both of which are accepted as eligible destinations. It would be perfectly simple, as well as extremely desirable, to add to the general power in clause 9(1) such words as:
  "including transfer to any body falling within clause 3(6)(a) above to the National Art-Collections Fund and to the Friends of the National Libraries."
  The purpose of subsection (4) of clause 9 is by no means clear. Historically speaking, it seems to be a somewhat garbled derivation from section 51(2) of the Finance Act 1946–the old Land Fund legislation. But section 51(2) of the 1946 Act refers back to section 50(3) of the 1946 Act, which is the equivalent of clause 9(2) of the present Bill and not of clause 9(1). Yet in subsection (4) of clause 9 of the present Bill there is a reference back to this subsection (1) rather than to subsection (2).
  I trust that the Minister is following all this. I am sure that you, Mr. Deputy Speaker, have got the gist of it. [An HON. MEMBER: "Set it to music."] I have not had time this afternoon to set it to music. I leave that to my talented colleagues.

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  I wish to question what I regard as the arbitrary and undesirable insertion of the trustees of the National Heritage Fund in clause 9(4). While the general power they are given would doubtless cover such a body, the specific mention of it suggests that one of the positive purposes of the Bill is to involve the trustees in holding and managing property. We all heard the right hon. Gentleman's disclaimer. It is all very well listening to the sermon, but these are the words of the good book. This would mean operating in the same field as the National Trust. The latter, however, commands the experience and the expertise and staff to undertake such tasks, which would be lacking to the National Heritage Fund trustees as envisaged at the moment.
  The subsection seems to be at variance in this respect with clause 4(3), which provides that if the trustees should exceptionally acquire property themselves, by means of their funds, they should not normally retain it and so act as principals. But there appears to be no difference in effect between property acquired by payment and property acquired through transfer. The right hon. Gentleman will note this if he will look at the clause.
  It should be borne in mind that if there is any serious prospect of the trustees holding and managing property, the whole nature of the trust is changed, and with it the qualifications of the potential trustees, since managerial and administrative skills would be called for. It will be difficult enough to find experienced trustees, as I am sure the right hon. Gentleman realises, to do justice to their duties as set out in part I of the Bill, without adding this further dimension almost by the back door, as it were, in part II. I hope, therefore, that reference to the National Heritage Fund trustees might be deleted from clause 9(4).
  The provision in clause 13 that property may be
  "accepted in satisfaction of interest"
  on tax is reasonable, but there is one administrative practice in connection with this which requires elucidation. The Inland Revenue possesses discretionary powers to waive interest charges retrospectively to the date of an offer when the merits of that offer are established by its acceptance. But it does so only
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  on rare occasions. In equity, ought it not to be directed to make this a more normal practice, and only to withhold this reasonable concession to the extent that the time consumed between offer and acceptance is judged to be due to causes other than the transacting of the necessary departmental procedures?
  This was, as the House will recall, the recommendation of the Select Committee on the Land Fund, and I hope that the position will be finally clarified in the context of the Bill. The problem is that debtors may well be deterred from entering into negotiations for acceptance in lieu, or at least deterred, if interest is charged during a lengthy period of departmental procedures, even though in the end their offer may be validated by acceptance.
  With regard to part III of the Bill, relating to indemnities for loans, I entirely endorse the general view of the museum and heritage world that it is largely a non-event. This part consists of two clauses. Clause 17 may be welcomed as a small, sensible and long-overdue provision, but the principal clause, clause 16,which gives national museums—and, I stress, national museums only—the power to lend to, among others, local museums, does very little more than provide statutory backing for what has hitherto been legitimate administrative practice, without as yet involving any claim on the Exchequer. The right hon. Gentleman admitted that in his speech. He has just informed me, as he will remember, in a written answer that a loan has been made to a National Trust house in anticipation of the Bill. I refer to the Turner water colours at Petworth from the British Museum collection which have been lent back to Petworth.
  A great deal of discretion in these matters has been properly exercised by Ministers in the past, but it will be interesting to know whether there is statutory backing for the various other forms of Government indemnity which are currently in existence. These include, first, loans by private individuals to national museums; secondly, loans by private individuals to Government buildings, including embassies; thirdly, loans to exhibitions abroad sponsored by the British Council; fourthly, loans to exhibitions in the United Kingdom sponsored by the Arts Council; and, finally, loans

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  to the current Post-Impressionist exhibition at the Royal Academy. If there are any other categories, perhaps the right hon. Gentleman will tell us.
  One facility which has long been strenuously and unanimously sought by the museum world—and which it was generally hoped, if the Bill were to deal with indemnities, would figure in it—was the provision of indemnities for loans from private sources to certain carefully chosen major museums which are the responsibility of local authorities and universities and the security of which had been approved by the security adviser to the national museums. Perhaps I should point out that in practice this latter expert regularly vets security at regional museums for the purpose of satisfying the strict requirements of the national museums when contemplating loans of works in their own collections to such museums. I must emphasise that these regional museums cannot afford insurance premiums. I am sure that the right hon. Gentleman will know that and admit it.
  This matter can hardly have come as a bolt from the blue, even to Departments whose liaison with, and understanding of, their so-called clients leaves so very much to be desired. I feel justified in pointing out that I have asked certain parliamentary questions on the subject during the past couple of years—on 26 April 1978, 24 May 1979 and 4 July 1979. More recently, the matter was aired in the correspondence columns of the The Daily Telegraph. There is, however, sadly no sign whatever in the Bill that the light has penetrated those dusty dormitories which serve the right hon. Gentleman.
  There are two points relating to indemnification which I want to stress. The first is the potential cost to the Exchequer. Over the years I have taken the trouble, in a long series of parliamentary questions, to establish that the cost to the Exchequer has in the past been absolutely minimal. As for long-term loans to national museums, £750 has been paid over the past 12 years. That has to be contrasted with the fact that at the beginning of this year the public enjoyed access to works of art indemnified for over £72 million.
  With regard to temporary exhibitions at national museums, the cost was less than £2,000 a year over 12 years. Loans
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  sponsored by the British Council have cost £24,000 over 10 years. Those sponsored by the Arts Council have cost £40,000 over five years.
  Although loans from private sources to Government buildings, including embassies, were started back in 1946, the right hon. Gentleman was recently good enough to inform me, in a written answer, that there is no record of any compensation ever having been paid.
  So much for what the Exchequer has had to pay in this field. I hope that there will be no question as to the enormous cultural advantages of the particular extension which I urge.
  But now I want to make a second point and to make it with all the emphasis that I can. It is this. When works are on loan to museums, the likelihood of their coming on the market—this often means being sold abroad, as the right hon. Gentleman will know—is in practice very much diminished. To provide indemnity for private loans to regional museums would therefore play an essential role in the preservation of our heritage, and at absolutely minimal cost to public funds. The right hon. Gentleman and his colleagues really must take in that simple fact.
  There is another extension of the indemnification system which would enable regional museums to play a further useful role. The Select Committee on the Land Fund and the whole of the heritage and museum world are agreed on the desirability of providing for specially selected objects, accepted in satisfaction of tax, to remain in their original location, subject to various safeguards, including public access. That, of course, is the "in situ" requirement.
  However, there is a problem when the location in question is not a publicly owned building. The solution suggested, and widely supported, is that ownership of the object should be transferred to the local museum, which would take over the responsibility for its care and supervision. But this service could be reasonably asked of a local museum only if it were spared insurance premiums by means of a Government indemnity—which is not much to ask.
  The existence of this problem wasrecognised by the right hon. Gentleman, and his press statement of 26 September led

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  us to beleive that it would be solved in the Bill. Alas, there is no genuine solution in it—merely an attempt at cosmetics, since clause 16 deals only with indemnities, not loans from national museums. Anyone except, apparently, the right hon. Gentleman's own departmental staff—who seem to make a practice of consulting others as little as possible—could have warned him that trustee-governed national museums are highly unlikely to accept on to their books objects up and down the country for which there was no physical possibility of their taking a serious responsibility. He has only to lift the phone and ask any of the directors of the national collections and he will get a short, sharp raspberry of an answer.
  Apart from the necessity to reconsider the accounting skulduggery to which I referred, and to make certain amendments, especially those involving a thorough rethink of clause 9 and the deletion of clause 14, there is a pressing case for two new clauses in part III. Whether the problems relating to indemnities were seriously faced at all in the Department seems doubtful. It is to be hoped that the draftsmen will now receive instructions to buckle to and that we can expect properly-thought-out new clauses tabled by the Government. Let us hope that there will be no further attempt by the right hon. Gentleman's Department or that of his right hon. Friend to bounce us again.
  Why has such a fundamentally simple Bill, the general purpose of which commands such general support throughout the House and the country, been so unnecessarily botched in part of the drafting? The reason is surely to be found in the mentality of the mandarins of Whitehall. They tend to deceive themselves into believing that, ex officio, they know best and to adopt the slogan of no consultation except with prospective yes-men.
  Nor have they profited, sadly, from the experience of the instant outcry from the museum world which was given not the slightest inkling of what was brewing when the proposed abolition of acceptance-in-lieu was unexpectedly produced in the White Paper of last February. In fact, what may not invariably have been true of the Bourbons—that they learned nothing and forgot nothing—seems unfor-
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  tunately to be an endemic disease in some Departments not tar removed from the right hon. Gentleman.
  In concocting the Bill, the departmental lack of timely consultation has once again been all too characteristic of the official approach, which persists in arrogantly assuming that mere briefing at the twelfth hour as to decisions reached without genuine consultation is all that the citizenry require—however much better qualified some of them may be than the corridor men.
  When I say "at the twelfth hour", that is being too charitable. The House will be amazed to learn that representatives of the regional and university museums are to be first convened—when? Will the right hon. Gentleman tell us? He does not know. They will be convened tomorrow. That is "consultation" on a Bill of this importance. That is disgraceful.
  The consequence of such a charade is that Parliament and everyone genuinely concerned with the art world are given much unecessary work and heartbreak. The simple reason is that what is decided in the monastic fastnesses of the Departments is so often out of touch with and resolutely ill informed about the real world in which the museum and art gallery people live.
  The much more experienced and qualified museum bodies whose opinions have not been sought at the right time become first frustrated and finally deeply resentful. I think that the right hon. Gentleman is aware of that. I hope that it is safe to assume that this total breakdown in communication has at length dawned on him. To be trusting is doubtless a virtue, and he practices many virtues; but to be too trusting when the evidence so palpably fails to justify it is to allow his charity to be abused.
  If the right hon. Gentleman gives the Bill a brisk spring-clean, turns over a new leaf or two and applies to a few backsides a touch of his elegant toe, all will be forgiven him. The art world undoubtedly wishes him well. We all want to see the Bill—tidied up a little as I have suggested—on the statute book, and we welcome its appearance.
  5.55 pm
  Mr. Patrick Cormack: I am delighted to be able

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  to add my words of welcome to the Bill and to congratulate my right hon. Friend, in slightly less diluted terms than those used by the hon. Member for Warley, East (Mr. Faulds). The hon. Member was rather uncharacteristically ungenerous. He has an all-embracing nature, as we all know, but this afternoon he has perhaps allowed his plaudits to be too muted. The indignation to which he gave vent at the end of his speech was a little under-rehearsed.
  Of course, parts of the Bill need tidying up in Committee, and that can be done, but basically this is a splendid and long-overdue Bill. The National Land Fund had an unhappy history, culminating in the fiasco of Mentmore, with which some of us were intimately involved. That in turn led to the reference to the Sub-Committee of the Expenditure Committee and now to my right hon. Friend's Bill.
  The Bill puts on a sound working footing that splendid vision which Hugh Dalton had over 30 years ago. In spite of the way in which the hon. Member for Warley, East tackled this matter, the most refreshing aspect of the exercise is that it commands all-party support. The Select Committee itself was all-party and unanimous. It adopted almost in their entirety the recommendations of the all-party Heritage Committee, of which the hon. Member and I have the honour to be officers.
  Then we had the last Labour Government's White Paper in February of this year. The Bill improves upon it in one or two important respects—particularly the retention of the in-lieu provisions. I am grateful that the hon. Gentleman at least grants it that.
  Mr. Faulds: I argued it.
  Mr. Cormack: Indeed the hon. Gentleman did, and we are delighted that he did. All this emphasises that this is an all-party occasion. It is vital for the preservation of our heritage that it should never become a political football.
  That is important for a reason that has not been advanced so far today. The Bill can be only one strand of a comprehensive heritage policy. The fund that we are hoping to set up can at best be only a safety net, which can be effective only if not too many owners of properties,
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  be they works of art or historic houses, feel forced to test it.
  Let us consider for a moment the riches of our heritage. We have talked in terms of £12 million or more and an income of £5 million. If in any year a Chatsworth or a Blenheim Palace were vacated by its owner, all the resources of the fund would be gone at one go.
  After all, it is nearly three years now since Mentmore. That collection, which the then Government could have acquired for a trifling sum—as the hon. Member for Warley, East and I agreed and fought for at the time—fetched under the hammer about £7 million. It would fetch considerably more today. What would the contents of Chatsworth fetch? Hon. Members can think of their own figures.
  In the light of that fact and of the fact that the Paul Getty museum alone has an annual income of double the total resources with which we are establishing the fund, one realises that we are talking merely of a safety net.
  This is not to decry my right hon. Friend's achievement. We all appreciate and applaud the Bill. But the fund can be successful only if it is part of a comprehensive heritage policy. Fundamental to that policy must be the concept stated by previous Ministers time and time again, from Dispatch Boxes in both Houses. They have said that the cheapest way of maintaining our great heritage of historic houses—that is where the vast sums of money are involved—with their great collections set in spacious parklands intact is by encouraging and enabling their owners to remain in possession. This was said by the noble Baroness, Lady Birk, at the time of the Mentmore auction and many times thereafter. The view was echoed by her noble Friend Lord Donaldson, and the previous Secretary of State for the Environment, the right hon. Member for Stepney and Poplar (Mr. Shore), made the same point from the Dispatch Box at that time.
  It is vitally important that owners be encouraged to remain in possession not just for themselves and the heritage of which they are the trustees but to meet the point made by the hon. Member for Warley, East about the landscape. Many of us have received a communication from the Ramblers Association. The association is rightly anxious that

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  our beautiful countryside should be as high a candidate for preferment when the fund trustees meet as any work of art or any historic house. I strongly endorse that, but unless the historic houses with their collections are kept intact the ramblers, I fear, will not have their dream realized.
  If we recognise the importance of our heritage to the nation, the Government, in preparing the Budget, must move forwards relaxing capital taxes and make other concessions promised by the Chancellor, and slot those measures in as part of a heritage policy broadly acceptable in all parts of the House. I say "broadly acceptable" because the previous Government recognised that point. I have referred to the oft-quoted statement about the cheapest way of maintaining historic houses. In a number of amendments to Finance Acts the previous Government sought to give expression to that policy.
  Even if we cannot grant the point a very high priority, let us look for a moment at tourism and realise that tourism is our major growth industry. Many of us may regret that, but it is a fact. Let us also recognise that investment by the Government in our heritage—which is what the tourists come to see—brings a far bigger return on the meagre sums invested than anything else one could imagine.
  In this context, we must regret the fact that the Government felt unable to accept the recommendation of the Select Committee. The Committee recommended that the £50 million set aside in 1945 by Chancellor Dalton be restored. We all accept the exigencies of the moment and we understand the problems faced by my right hon. Friend, but we hope that in the course of the next few years the fund will be restored to something like £50 million. It has been calculated that, if the fund were re-established, that figure of £50 million in 1945 terms would be the equivalent of more than £400 million today. Obviously that is unrealistic and out of the question, but if the fund could be restored, as urged by the Select Committee, to £50 million, this would give pleasure to us all.
  We also regret that, although the "in lieu" system has been maintained—we
  88
  are glad of that—there will be the need for constant reimbursement for items accepted. The Select Committee stated:
  "Your Committee therefore recommended that Her Majesty's Treasury's rule of reimbursement by national collections to the National Loan Fund be discontinued."
  I am delighted that the word "may" is in the Bill. Let us hope that, as economic circumstances improve, that "may" will indeed take the place of "shall".
  There are a number of points on which I seek clarification. I am sure that my hon. Friend will try to answer these points when he winds up. First, there is the point raised by the hon. Member for West Lothian (Mr. Dalyell). He asked what were the specificroles of the Secretaries of State for Scotland, for Wales and for Northern Ireland. We have had a tentative answer from my right hon. Friend, but we would welcome confirmation that some trustees will be appointed, or could be appointed, by the Secretaries of State. This Bill embraces the whole of the United Kingdom, and it is important that the Secretaries of State who have responsibility for Scotland, Wales and Northern Ireland should be fully consulted.
  In clause 3 there are one or two important points on which we should have clarification. The clause says:
  "(1) Subject to the provisions of this section, the Trustees may make grants and loans out of the Fund to eligible recipients for the purpose of assisting them to acquire, maintain or preserve—"
  I would have preferred to see the word "enabling" rather than "assisting" and I would like to know whether "assisting" can mean "enabling"—in other words, a 100 per cent. commitment. I would like to know also whether the words "maintain and preserve" embrace "endow". It is important that endowment should be provided.
  We all know that the National Trust can no longer contemplate taking on any more historic houses unless it receives enormous endowments to maintain buildings. That is another reason why we should not try this safety net too often. As regards the conditions enumerated in clause 3(1)(a), (b) and (c), I would like to know whether "land" includes gardens. The great historic gardens of this country are a most important part of our heritage. Does the word "object"

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  include structures such as the Iron Bridge? If we are prosing legislation to stand the test of time, we must make sure that no important part of our heritage is left uncovered.
  Under subsection (2) of clause 3, I presume that among the bodies from which the trustees will take advice and which they will consult will be the Export Reviewing Committee and the Historic Buildings Council. I would be happy to have confirmation on that point.
  I bring an extremely important point to the attention of the House concerning clause 3(5)(a)(i). The words "public access" are used. In subsection (6)(b) we have the words
  "any body having as its purpose…".
  Public access is an issue which is not often fully understood. There are some extremely magnificent country houses which do not lend themselves to constant hours of opening and which cannot accommodate enormous streams of visitors. It is important that that sort of house should be covered by the Bill. There should be reasonable access, but that must not mean constant hours of opening or specific numbers of people.
  An even more important point is that there are tracts of landscape which could be spoiled by public access. I would like to believe that the words "any body" to which I have referred would include the Royal Society for the Protection of Birds. One of the objects of that society is to preserve nature reserves. The public must be kept away from them if the habitat is to be preserved and the society's conservation remit observed. Would the RSPB qualify under clause 3(6)(b)? If my hon. Friend is unable to answer that question this evening, I hope that he will show sympathy with the point I am making.
  Clause 5 deals with gifts entrusted to the trustees. I was pleased at the assurance that there will be an amendment in the next Finance Act to include the fund in the schedule 6 bodies. Without that, nobody will wish to give. We must think in terms of being more adventurous. I hope that in the future we shall consider introducing heritage bonds in which people can invest.
  Part II is headed
  "Property Accepted in Satisfaction of Tax".
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  Two Ministers are involved. When an acquisition is paid for, will 50 per cent. of the payment come from each Minister, or can the payment come out of one Minister's budget? The fund is to be topped up each year by a contribution from the Department of the Environment and the Office of Arts and Libraries. Will each acquisition be paid for in the same way?
  I am worried about the definition of "pre-eminent". When an object is accepted in lieu of tax, it must be "preeminent". We should re-examine that definition. That which is pre-eminent in Leeds is not necessarily pre-eminent in the Tate. Many objects are pre-eminent in their locality but are not of outstanding national importance. We should ensure that we do not miss important objects as a result of that definition. This is particularly important when we are considering the acceptance of objects that are to remain in situ. I was delighted to have the Minister's assurance that the Government intend that where an object is of great historic importance and associated with the building in which it has been housed for centuries it should stay there.
  We must reconsider the definition of "pre-eminent" and consider into whose guardianship an object should pass when it is allowed to remain in a building. Local museums should be empowered to act as guardians or keepers in such cases. It does not make sense for somebody from the Victoria and Albert museum to travel all the way to Castle Howard when an object can be looked after by the staff at Temple Newsam. I hope that it will be possible for the provincial museums—some of which are indeed pre-eminent—to have guardianship of such objects. If there is no proper indemnity, that will not be possible.
  Mr. Esmond Bulmer: The word "outstanding" is used in clause 3. "Outstanding" is described in the Oxford dictionary as meaning "eminent", which is more flexible than "pre-eminent". Perhaps that is the word which my hon. Friend seeks.
  Mr. Cormack: That is a good suggestion. The words "outstanding" or "of intrinsic importance" are possibilities. It is important that we do not so restrict ourselves that we miss objects which are of particular interest or importance.

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  I may be wrong, but it seems that VAT will be payable on any work which trustees carry out when repairing a building which they have accepted. It is not intended that trustees should hold buildings or objects for long. Nevertheless, inevitably there will be a time lag. It could be days or many months. In some cases it will be necessary to effect repairs to a building. It is wrong if the trustees have to shoulder the burden of VAT on necessary first-aid repairs.
  Mr. Faulds: Does the hon. Gentleman agree that the whole issue of VAT on the arts and the heritage would be enormously simplified if the Government had the good sense to drop it from those aspects of our cultural life?
  Mr. Cormack: The hon. Gentleman tempts me to go too far. He knows my views. He knows that I believe that a 15 per cent. VAT rate is a penal surcharge on those who have the job of looking after ancient buildings. I should like confirmation that my interpretation of the Bill is correct. I should also like confirmation that when the Department of the Environment buys a building it does not pay VAT on repairs. If I am correct, there is an anomaly which must be put right. Value added tax is a significant obstacle to the maintenance of historic buildings, and the trustees could be faced with real problems.
  The hon. Member for Warley, East referred to the Expenditure Committee's recommendation that there should be a remission of interest during the period of negotiation. Those who were involved with Mentmore know how protracted such negotiations can be. In fact, those negotiations failed and, therefore, this would not have applied, but had they succeeded this provision would have been important. When proper negotiations are entered into honestly, there should be a remission of interest incurred during that period.
  It is not usual to pay trustees. I welcome that. However, the first trustees of the National Heritage Fund, and especially the chairman, whose appointment is vital, will have a great deal of work to do. It will be unfortunate if the only people who can serve as trustees are either elderly or rich—or both. It is important that the best talents available
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  are recruited. The chairman's job will be virtually full-time at least for the first year or two. I hope that we can consider some form of remuneration for the chairman of the trust.
  Mr. Clement Freud: Since the Government have an affection for the honours system, perhaps they may award—or possibly reaward—a knighthood.
  Mr. Cormack: We all know that for the hon. Member for Isle of Ely (Mr. Freud) the task of serving would not impose burdens and a knighthood would, indeed, be an admirable recompense. If he were awarded a baronetcy, how his name would be immortalised.
  Mr. Speaker: The hon. Gentleman could have a peerage if he remembered that others also wish to speak.
  Mr. Cormack: I am grateful for that promise. Having been tempted off the paths of righteousness by one of the most righteous of hon. Members, I shall conclude. This is an important Bill. It is the most significant piece of heritage legislation in more than 25 years. I wish it well and I hope that it will reach the statute book speedily.
  6.19 pm
  Mr. John Parker: I welcome the Bill. I also declare an interest, as a member of the Historic Buildings Council and a member of the executive of the National Trust. But I should like to make it clear that I am not speaking for either body today.
  Rightly, we have paid tribute to Hugh Dalton for the original idea which led to the creation of a national land fund. I should like to pay further tribute to Arthur Blenkinsop and to Arthur Jones, who urged the Select Committee to reach such sensible conclusions and recommendations which Governments have since followed up and which have led to the Bill.
  It is important that the trustees should be independent and I am pleased that they will be appointed by the Chancellor of the Duchy of Lancaster and the Secretary of State for the Environment. It is important that the trustees should be independent of the Treasury. Throughout our discussions on the arts, historic buildings and the heritage generally, there has

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  always been opposition from the Treasury. I should like to reinforce the point made by my hon. Friend the Member for Warley, East (Mr. Faulds) that the Treasury should not come in by the back door to influence decisions unduly.
  I agree that the funds available are much too small, in view of the amount originally set on one side by Hugh Dalton for this purpose. It is to be regretted historically, whoever may be at fault, that this sum of money was not left by itself to increase in value. As the hon. Member for Staffordshire, South-West (Mr. Cormack) said, it would now be worth well over £400 million, and there would have been an income of £60 million which would have gone a long way towards meeting the needs of the National Heritage Fund. We must, however, accept that that has happened.
  I should like to comment on the present position and on some of the problems which the National Trust has had to face in recent years. It agreed to take over from the Government the ownership of certain houses which were handed to them. Arrangements were made by which the Government agreed not only to hand over houses but to pay a certain amount of money yearly to finance the deficit on those houses. Over the years there has been considerable trouble with regard to that arrangement. There have been arguments about how much money should be paid yearly towards the maintenance of these houses. There have been arguments about detailed managements and delays in paying the money. It was for those reasons that the National Trust decided that it could not take over further houses under those arrangements.
  I do not think that that solves the problem. Whatever arrangements may be made for taxation purposes to try to keep owners in possession of their houses, from time to time there will be other houses for which some future will have to be found. I hope that arrangements can be made by negotiation by which the National Trust can take over properties on more favourable grounds than in the past.
  The Department of the Environment—formerly the Ministry of Works—did a good job of work in the restoration of Audley End. I remember going there when it first came into the possession of
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  the Ministry. It was almost an absolute ruin after it had been occupied by Polish troops during the war. No repairs had been carried out since 1860. The restoration cost so much money that the Department has not been prepared to take over similar houses for restoration in the future.
  At the moment we have the problem of Heveningham, a house which was about to be demolished in the 1960s. The Government stepped in and bought the house to prevent it from being demolished. They were not prepared to manage the house themselves and to restore it as they had restored Audley End. They asked the National Trust to manage it for them. There has been considerable friction because the National Trust feels, quite rightly, that the house is not a credit to it or to the Government. Much of it is in bad condition. The orangerie is practically falling down and no money has been forthcoming to carry out essential repairs or restoration work.
  Heveningham has now been put up for sale. National Trust management comes to an end, I understand, in March next year. If no one buys it, it will fall down or it will have to be demolished. What is to be its future? That problem should be dealt with in the debate tonight.
  A large number of houses may be in difficulties in the future. I am all in favour of keeping such houses running as going concerns, but unless some arrangement is made with a body such as the National Trust to take over when necessary there will be difficulties in the future.
  An alternative has presented itself. Special trusts are to be created for certain houses, as the Arundel Trust was created to manage that estate. Such trusts are set up because the owners cannot find sufficient capital to give to the National Trust to enable the trust to take them over. Therefore, a smaller fund is set up. But how long will that fund be a viable institution? There may come a time when extensive repairs are necessary and resources are not available. The creation, therefore, of such alternative trusts to deal with a particular property may produce problems in the future. That can only be a temporary solution. What is to happen to houses that cannot be taken over by the National Trust because insufficient

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  capital can be found? What will the National Heritage Fund be able to do in such circumstances?
  There are a number of minor manor houses which can never be great attractions for visitors. But they are an important part of our national heritage and should be preserved. It might cost, say, a quarter of a million pounds to put some of these houses in good condition. The National Trust might then take them over. The rent and income from occasional visitors might then be sufficient to maintain them.
  Rightly, we have become interested in industrial archaeology, and a number of buildings—the hon. Member for Staffordshire, South-West mentioned The Iron Bridge—are being cared for, restored and maintained. But our agricultural heritage is not being maintained in the same way. Many barns at farms are fine examples of craftsmanship. Some are in the possession of the National Trust. Many large barns can be maintained and visited. There are also many smaller barns of good standard and character, some of which can be used for storage. But when a farmer receives a grant from the Ministry of Agriculture to put up new barns he may do that and keep the old barns or he may pull the old barns down to make room for them. There is a strong case for preserving our agricultural heritage. An agricultural museum for farm implements is not sufficient. Farm buildings which have architectural merits should be preserved.
  I am particularly struck by what I think is a big error by the Ministry of Agriculture. The village of Laxton is one of the few places where the medieval open field system of cultivation continues. I believe that there is also a place in what was Carmarthenshire, and there are one or two other places, but Laxton is the most complete example in this country. People come from all over Western Europe to look at it. Schoolchildren are taken there to be educated on how we ran our agriculture before the enclosurer.
  That property was bought by the Ministry of Agriculture in 1952 to preserve it. Now it is on the market, because the Ministry decided to realise some of its agricultural properties in order to find money to make a contribution towards the present financial crisis. No one
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  objects to other farms that have no historical interest being sold, but this property should not be sold. It is of great historical importance; it is an important part of our heritage. Promises are being sought that a new owner will try to preserve the existing system, but there is not the same guarantee that this will happen as there is when it is in the Ministry's possession. The Ministry can see that the system works and that it goes on working.
  The system has the full backing of the local population. The whole operation—the election of officers, the working and the division of the fields—is not merely a theoretical piece of history but is practical and working. It is unfortunate that at the very time when a Bill of this kind comes before the House the Ministry should be selling this property. We should consider the agricultural heritage as well as the industrial heritage when we think of possible grants and work to be done.
  To sum up, I welcome the Bill. I hope that we can improve it in Committee. Many useful suggestions for improvement have been made. I should like to see it become law as soon as possible.
  6.32 pm
  Mr. Esmond Bulmer:: Like the hon. Member for Dagenham (Mr. Parker), I must declare an interest, as a member of the executive committee of the National Trust. I should like to follow up some of the things that the hon. Gentleman said, but first I extend a general welcome to the Bill and the fact that it has the support of the official Opposition. Credit may properly be taken by both sides of the House, but I think that the Bill was conceived by the Environment Sub-Committee out of Mentmore. It implements many of the Sub-Committee's recommendations. The Bill is welcome for its flexibility and for the promise of better things to come, amplified most helpfully by my right hon. Friend the Chancellor of the Duchy of Lancaster.
  For the first time we are to have a fund with which to protect our heritage, a fund whose existence will not be in doubt and one with significant resources. We are to have a committee of independent trustees with relevant knowledge and experience drawn from all parts of the

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  kingdom. We shall have a safety net and an early warning system. That is a great step forward.
  The trustees will want to be active as well as reactive. Looking at schedule 1, I hope that my hon. Friend the Minister who winds up the debate will say a word about the staffing arrangements. The staff will not be regarded as Crown servants. Does this mean that civil servants will be encouraged to transfer, if they wish? If they do, will their pension and other arrangements be protected? In the case of non-civil servants, if wrong decisions are made and compensation must be offered, will the arrangements be sufficiently generous to allow that to happen? I very much hope that civil servants will be allowed to transfer, and if necessary to transfer back again, if they have particularly relevant information and skills.
  We are all agreed on the importance of preserving our heritage. We have been uniquely blessed, by reason of geography, climate and social history. John of Gaunt said it all.
  "This fortress built by Nature for herself"
  became the seat of the greatest empire since Rome. It is now second only to Italy in its architectural heritage. For hundreds of years we have been able to draw on the best that the world had to offer in ideas, natural resources and the decorative arts. This is our incomparable inheritance.
  When we visit the empty chateaux of the Loire and the great cities of Europe destroyed in the last war, we indeed have reason to give additional thanks.
  It was in recognition of the sacrifices made in war that Dr. Dalton conceived the National Land Fund as a perpetual memorial. I regret that this concept has not been continued, that it has not even been given a decent burial. I hope that the trustees will look in each part of the United Kingdom for one area of outstanding beauty that should be endowed as a perpetual memorial to those who died.
  The Labour Government's White Paper said that it was not part of the fund's role to contribute substantially to exceptionally expensive proposals. If a memorial is not to be treated on a regional basis, there may materialise one scheme that seems so particularly suitable that
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  the Government feel it fitting to give an extra sum of money for one national memorial. We need more than cenotaphs. We need places of peace and beauty where people can remember.
  Dr. Dalton earmarked £50 million from the sale of war materials. At 1977 prices that was worth £200 million—a great deal of money, but less than one year's loss in one nationalised industry. When we remember that foreign visitors generate £3 billion of income and that our heritage is outstandingly the most important reason for their coming here, we understand not only what large sums are at stake but how little we are putting back into a major national asset. It is critically important in terms both of the employment that it will generate and of the balance of payments.
  I know that my right hon. Friend's instinct is to spend more. The Treasury, of course, is only too conscious of the present difficulties and is reluctant to give more, but I hope that in due course the figures in the Bill will be increased. In the meantime, we must do all we can to neutralise the forces of destruction, the rising costs, the penal taxation. It is just as important as pouring fresh concrete into the foundations.
  In a speech, I think to the Historic Houses Association, my right hon. Friend listed four initiatives that he expected this Government to take. There have been important cuts in income tax, and a review of capital taxation is promised. I am sure that that review will take into account the need for maintenance funds to be far more attractive than they have been.
  My right hon. Friend drew attention to the listed building repair allowance as it operates in Holland and the need for case 1, schedule D, to be available as of right. The hon. Member for Dagenham drew attention to Heveningham, which is a classic example of a house that could never have a fraction of its repair costs compensated for by entrance fees. I think that that applies to virtually every house except those houses whose owners decided in effect to go for much wider forms of entertainment. It is ludicrous that the Treasury should hold to the position that an owner is guilty until he can prove himself innocent.

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  I seek further clarification of clause 3. It does not mention endowments, but clause 4 seems to make it clear that the trustees can endow property. I would not feel the need to ask the question but for the policy followed by successive Governments of avoiding any offer of capital endowments, despite the power to do so in the Historic Buildings and Ancient Monuments Act 1953. May we have an assurance that these endowments can be offered and that the Government will remain neutral, or will they be offering guidance to the trustees?
  The National Trust, as the House knows, has received many important properties through the National Land Fund, but has had to spend hundreds of thousands of pounds out of its own charitable fund to maintain them. Mr. Boles, the director general of the National Trust, told the Expenditure Committee that
  "the National Trust is quite sure that it cannot become the owner and manager of the bulk of the National Heritage".
  It is quite clear that without adequate endowment the National Trust would be reluctant to accept any great house.
  Mentmore alerted the nation to the risks facing our great country houses. Today a million pounds may not be enough to endow quite a modest house. It would certainly not be enough to endow any of the great houses still in private hands—Chatsworth, Hatfield, Longleat, Woburn, Syon, Blenheim, Kedleston, Castle Howard, Althorp, Wilton, Holkham and Houghton. One only has to list the houses to rehearse the scale of the problem with which the Government might be confronted. From what my right hon. Friend the Chancellor of the Duchy of Lancaster said, I understand that such houses would be treated as special cases.
  Mr. Cormack: It is important that there should not be any special cases, but if there are they should be the minimum number possible.
  Mr. Bulmer: I take the point made by my hon. Friend.
  From the evidence given by the National Trust to the Environment Sub-Committee that looked at the problems of the National Land Fund, there is one
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  other point that I should like the Minister to consider. In paragraph 8 of its submission the National Trust said:
  "In Northern Ireland, and perhaps elsewhere, it would in the past have been useful if the Land Fund could have been used to pay for the acquisition of Rights of Way and possibly of sporting and fishing rights and other easements in order to promote better access of the countryside."
  Earlier I welcomed the flexibility of the Bill, but I wonder whether clause 3(1)(c) might not in due course be amended to make it possible for purchases to include easements, rights of way and sporting rights. Nowhere is it more important than in Northern Ireland that people should have as much access as possible to recreation.
  I said that I welcomed the Bill particularly because of the promise of better things to come, but I join with several other hon. Members who have spoken in hoping that events will prove that the promise in clause 8 is an indication that we can move to the French system of accepting heritage objects without revenue offset. The last figure I saw was £1·6 million out of £384 million received from capital taxation. That hardly seems a significant figure.
  I hope that in due course more money will be made available for the National Heritage Fund and that there will be some simplification of ministerial control. I believe that the Bill should be given a general welcome.
  6.43 pm
  Mr. Ednyfed Hudson Davies: I welcome the Bill, with perhaps some reservations. I welcome the provision for financial assistance to a wide range of bodies providing they are of importance to the heritage—not merely to museums and galleries but, indeed, to any body having as one of its purposes the improvement and preservation of amenities enjoyed, or to be enjoyed, by the public. That is a desirably broad scope.
  I am delighted that a real fund is to be securely, if perhaps modestly, established and not a notional and depleted fund, such as the old National Land Fund, which turned out to be so inadequate. I hope that the tragedy of the failure of the nation to acquire Mentmore is not something that could, in the terms of the Bill, happen again.

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  I am delighted, too, that the trustees will be independent. I believe in independent trustees as well as the whole concept of trustees. It is desirable that it should be written into the Bill that the trustees should represent in some way, and have some connection with, the length and breadth of the United Kindom. In this artistic area there is perhaps often a danger of an over-emphasis on London.
  It is important that the trustees should not be under Treasury influence and jurisdiction. It is also important that the danger of having experts, as such, is avoided in the definition given in clause 1, in that they should
  "have knowledge and experience or interests relevant to the purposes for which the Fund may be applied."
  They should not be over-technical experts. That is very desirable.
  I come to one reservation that I have. In the Bill there is a clause that deals with the arrangements that are to be made for the exercise of the in-lieu procedure, whereby the Inland Revenue is permitted to accept objects in place of financial settlement in payment of tax liability—currently capital transfer tax and perhaps residual cases of estate duty. I should have preferred to have seen this particular function exercised not, as the Bill stipulates, by the Chancellor of the Duchy of Lancaster and the Secretary of State for the Environment, assisted presumably by the Secretaries of State for Wales and Scotland and the relevant Minister for Northern Ireland, but by a body of trustees with jurisdiction over the whole in-lieu procedure. The system envisaged in the Bill perhaps opens up an area for squabbling and possibly the application of different standards in different parts of Britain.
  Many problems have arisen in connection with the way in which the in-lieu procedure has been exercised. Reference has been made to the standard that was laid down in the Finance Act 1976, which was that objects can be taken in place of payment if they are pre-eminent for national, scientific or historic interest. But the word "pre-eminent" tends to be interpreted as what is pre-eminent, say, to the national galleries—here I am thinking of the Tate gallery and the National gallery. It is a London-based concept.
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  The point has already been made that an object can be of enormous value perhaps in a provincial context. For instance, an object that would have meaning, significance and artistic merit in Wales would not perhaps make the ratings in a national, London sense.
  I can mention one or two examples where this procedure has caused a great deal of difficulty. For example, a Reynolds which was of great importance and significance in Doddington was not accepted in lieu of tax liability because it was not a Reynolds that rated with Reynolds in the London galleries. But in the context of Doddington, where it portrayed a stage in the building of a house, it was enormously important. I feel that some such term as "significant in its context" would be preferable to "pre-eminent".
  Another troublesome situation occurred at Althorp, where objects were accepted but on unfortunate conditions. The Van Dyck paintings in the Van Dyck room which hadbeen built to house them were accepted—indeed, they were worthy of acceptance—but they were accepted on condition that they were taken away, torn out of their setting and placed in the National Gallery, thus depriving the people of Northamptonshire of the opportunity to visit Althorp and see those Van Dycks in the setting created for them.
  An unfortunate state of affairs of that kind would not, I believe, occur if the body of trustees envisaged under the Bill were exercising their function in that respect.
  I ask the Minister to give an assurance that, if the present system is to be maintained, with the Ministers instead of the Treasury being responsible, there will be some modification of the concept of preeminence and that more attention will be given to regional significance, in keeping, in fact, with the thinking behind the recommendations of the Drew Commission and the emphasis on regional centres of excellence.
  I hope that efforts will be made to allow objects which are of value in their setting to remain in situ—in other words, that a loan procedure will be established whereby objects taken by the Revenue may be allowed to remain in the one place where they have perhaps been for centuries, where they make sense and where they have their real value.

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  There is a further difficulty in the question of separation. The Chancellor of the Duchy of Lancaster referred to this, although he did not view it as a difficulty. Under the system envisaged in the Bill, some payments will have to be preempted from the fund each year—and in the first year they will run to several millions of pounds—for the purpose of in-lieu payments to the Revenue. I regard this as an unsatisfactory division. It would be far better if one group of trustees and one fund were used for both purposes, for grants and loans and for payments to the Revenue.
  However, I think that there is here an element of hope, since I note that in clause 14 there is provision for transfer to the trustees of the functions envisaged in the Bill as being exercised by "the Ministers". Perhaps, when the Bill was drafted, there were misgivings among some people about this division, and I greatly hope that, as we see the trustees appointed and watch the work that they do, that transfer of functions will in the long run take place.
  Mr. Alexander W. Lyon: I was on the Select Committee which considered these matters. I was strongly of the view that there should be a difference between the people who take the decision about how much the country can afford at any one time and those who decide on the artistic merit of what is to be bought within that budget.
  If both functions are to be transferred to the trustees, all that we shall do will be to move out of Whitehall that incongruity between the two functions which formerly resided in Treasury officials, and we shall not have made any real move forward. Surely, it would be better if the question of how much we could afford was totally distinct from the artistic merit of what was to be afforded, with the trustees making up their mind within their budget what was the highest priority.
  Mr. Hudson Davies: I appreciate that point, save that, in my view, it is within the global sum attached to the fund that the decision is made as to how much the country can afford, and the trustees will then be exercising a wide discretion within the ambit of that fund. But that is undoubtedly something which will be the subject of further discussion.
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  The preservation of our national heritage is not only important to our own people but is a profitable exercise in preserving a national asset. I refer here to the importance of our heritage in relation to tourism. In 1978 we earned in Britain £1,131 million in foreign currency from overseas tourists coming to Britain. People come to Britain not for our climate but, perhaps more than anything else, for the whole range of our heritage—for places, for objects and for buildings, both private and public, which can be described as part of our heritage.
  The previous Labour Government recognised the importance of our historic homes. It is certainly in the national interest that they be preserved and that, where they are in private hands, assistance should be given for their preservation. Perhaps the greatest help that can be given to a historic home is that it should be allowed to keep on loan objects which have become the property of the nation through acceptance by the Revenue in lieu of tax liability but which can remain in situ within the context in which they make sense.
  I speak as a former chairman of a national tourist board and as a member of the board of the British Tourist Authority when I say that there is an enormous financial return to this country from the quite modest investment which we make in our heritage. I am delighted that the Bill will to some degree extend that investment. I hope that the introduction of the concept of Government indemnity for loans will be interpreted in such a way as to make it possible for objects to remain on loan in the houses whence they came in the first place and where they have meaning and significance.
  It is important to remember that, although some have been more assiduous than others as custodians of our national heritage, it remains none the less the national heritage of us all. The Bill goes some way towards facilitating the task of preserving our heritage.
  6.58 pm
  Mr. W. Benyon: I think that I am the first member of the Select Committee to speak in the debate today, and I cannot express strongly enough the pleasure which it gives me to take part and to welcome the Bill, which has come

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  forward as a result of our deliberations in the last Parliament.
  I pay my tribute to Mr. Arthur Jones and the late Arthur Blenkinsop for their part in the work of the Select Committee. Our report was unanimous. We took a long time, we had a lot of evidence, and the assistance of our two colleagues in our deliberations was a truly fitting finale to their respective careers in Parliament.
  It is not always the case that the recommendations of a Select Committee are so soon accepted by the Government. I suspect that a number of other people who have laboured hard and well in those rooms upstairs must be looking rather enviously at what is happening today in relation to what was the National Land Fund and will now become the National Heritage Fund.
  My first comment is to emphasise how important the selection of trustees will be. I suppose that that goes without saying, but it is of especial importance in this case since, whatever happens, they will, in effect, be the arbiters of the national heritage as a whole. Their actions must be seen to be fair, and not favouring any particular part of the heritage but dealing with each fairly. This will be a very difficult job. I listened with considerable interest to what was said by my hon. Friend the Member for Staffordshire, South-West (Mr. Cormack) about payment and the amount of work which the trustees will have to do. I am certain that is a question which must be considered carefully in Committee.
  The Arts Council is a good precedent for our actions. That precedent has been established by giving an independent body a sum of money each year that it may decide how to spend. The Arts Council has been criticised over the years, but it has done an extraordinarily good job in that respect and provides a good precedent for the new trustees of the National Heritage Fund. Like several hon. Members, I am sorry that our recommendation that the £50 million should be reinstated could not be implemented. However, I, too, understand why that could not be done.
  At least the Bill will put an end to the Byzantine obscurity of whether the money paid from the National Land Fund each year was Government expenditure. In Committee we went
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  round and round that question, but it is now quite clear. It is an initial grant with a topping-up grant each year. If circumstances demand it, the trustees can go back to the Government and say that they need something for a particular operation.
  I do not think that the question of endowment is clear. When I first read the Bill, I thought that endowment was out. As hon. Members will know, we received very strong evidence from the National Trust and others that we should be able to endow properties.
  Like my hon. Friend the Member for Kidderminster (Mr. Bulmer), I find that clause 4(1) seems to cover endowment. Perhaps when the Minister winds up he will be able to say quite definitely whether that clause does or does not cover endowment. If it does not cover endowment, I hope that the Standing Committee will look carefully at that and see whether it can be put in.
  It is important to remember the definition of "the heritage". Parts of the heritage will not go away. The coastline will not disappear. It can be desecrated or spoilt, but it cannot vanish or moulder away. However, a house or a painting, for example, can moulder away.
  My hon. Friend the Member for Staffordshire, South-West referred to how fortunate we are to have such a heritage. However, a great part of that heritage was amassed and built during periods of high prosperity, when people had the necessary money to build or buy something and to preserve it. It is because that is now at risk that these provisions are important.
  I am glad that the proposal in the White Paper that individual sums of money should be limited has not been implemented. We live in a difficult time and it would be wrong to limit the trustees in that way. One small point that struck me while reading the Bill was the position of the Ministers. It is fair that the Secretary of State for the Environment and his Department are involved, but the Bill also mentions the Chancellor of the Duchy of Lancaster. At the moment, he is responsible for the arts and heritage, but that may not be so in future. My right hon. Friend is only mortal, and therefore I wonder whether it is intended that these two particular

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  offices of State should be so designated. Perhaps the Minister will also deal with that when he winds up.
  It was extremely wise to keep the in-lieu provisions and to go against the original suggestion. The more important aspect is how that fund will operate, especially as regards the destination of objects. The hon. Member for Caerphilly (Mr. Hudson Davies) mentioned that where something is taken in lieu or where something is purchased, it should be possible for it to go back to the house. It would still be owned by the museum, but would be kept in situ so that people could see it in its proper environment.
  Clause 3(6) carefully sets down the people who can be given such objects. It is right that that is so. If the fund had been in existence and the Warwick castle Canalettos had been purchased, they obviously should have been in Warwick castle even though that castle is not a recipient under the terms of the clause.
  If anyone thinks that this is the final answer for the preservation of our heritage, he had better think again. The taxation system is a most important aspect that must be covered. Reference was made to that in our report, during the last Session. My hon. Friend the Member for Staffordshire, South-West has already said that if two large important houses came on to the market at the same time the fund would dry up. The alteration of taxation arrangements should go hand in hand with the setting up of this important fund. The taxation arrangements must vary from one set of circumstances to another. What is right for Woburn or Chatsworth is not right for a small manor house or a particular picture that is kept in a smaller house. All have their different characteristics and all must be considered. That variation is the great glory of our land.
  Much has been said about tourism. I was interested to read last week in the Evening Standard that a survey had been carried out among tourists in London. They were disillusioned with London because it is dirty and expensive, and so on. Tourists do not come here to enjoy our climate or beaches, but to see what can loosely be called "our heritage." Britain's greatest factor is its country houses and the contents of those houses. If we
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  allow them to wither away and become impersonal, unoccupied museums, as they are in France, it will be the greatest tragedy of all. One must encourage and help the private guardian or trustee—I prefer "trustee or guardian" to "owner"—who will look after them. Whatever happens, the trustee or guardian should not be able to walk off with any cash. It must all go on the preservation of the fabric or particular chattel. If either is sold, the full rate of tax must be paid.
  The public must have access, and that will vary with the particular house and circumstances of the house and owner. The evidence given to us on the Select Committee seemed to show that that has operated very well and that the arrangements made for each particular house are fair and just. I am sure that that can be expanded. If we put our minds to altering—in many cases not in too great a way—the taxation arrangements, so that they will help those who own such houses to continue and preserve their contents, the Bill will be of great significance.
  The sums of money involved will be very large in the future, whether inflation continues or not. The provision made today in the Bill will not be sufficient to preserve our heritage in the future.
  7.10 pm
  Mr. Clement Freud: On behalf of my right hon. and hon. Friends, I should like to welcome the substance and intention of the Bill, though, like other hon. Members, I have reservations about the limit of its extent.
  It is right that successive speakers have paid tribute to Dr. Dalton and the National Land Fund, which was the predecessor of the National Heritage Fund. The concept of the National Land Fund was similar to that in Julius Caesar's will in which he left his parks and walks and castles to the people of Rome. The purpose of Dr. Dalton's fund was that we should celebrate peace by giving open spaces to the people in order that we might remember the war and our victory.
  One matter that has never been considered with sufficient care is that the fund was set up not with a notional £50 million but with an actual £50 million. We shall not go into the iniquities of those who wound up the fund, but when it was wound up 11 years later it had had

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  a lifetime expenditure of £750,000 and after those 11 years it was said to be worth £60 million. Interest had been allowed to the fund at a rate much less than what could have been earned from the Post Office savings bank. An investment of £50 million over 11 years produced interest of £10 million. Even at 2½ per cent., simple interest on £50 million would have given £1¼ million per annum.
  If the trustees had been normal trustees, they would probably have stood trial, for it is totally wrong for any trustee to administer money in that way. Today it is doubly important that we ensure that the trustees who are appointed this time are so independent of the Treasury that there is no chance of a repetition of that sort of scandalous rate of interest.
  If the trustees had done what I am sure they could have done, namely, to say that as trustees of the National Land Fund they would invest in land of some sort until they got land of the right sort, the sums of £300 million and £400 million that we have been talking about would have been realised.
  To some extent, the Bill has been brought in to buy off criticism, and I am sorry that the price for which we are asked to vote is so small. Buying off criticism ought to be in real terms and not in the minuscule terms that we are offered. An initial £15½ million and an annual £5½million are mean sums, but then the Government have shown that, in the arts, actual aid as opposed to electoral promises of aid is some way from being generous.
  The hon. Member for Buckingham (Mr. Benyon) and other hon. Members have mentioned tourism, and the sum of £3 billion has been referred to. In its latest report, the British Tourist Authority says that £6,800 million accrues to the nation as a result of tourism and kindred activities. That is the figure that we must look at. I can think of no commercial company that would invest 0·2 per cent. from central funds in order to sustain its own prosperity. That is the ratio of 15½: 6,800. It is a niggardly sum.
  The hon. Member for Buckingham also said, rightly, that the coastline remains the coastline; but as the National Heritage Fund is the successor to the National Land Fund, it must be appreciated that land can be developed and
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  wrecked. That is why I should like the Minister who is to reply to explain whether land is included in the terms of reference of the National Heritage Fund. There seems to be no specific mention of it in the Bill.
  I agree with what was said by the Father of the House, the hon. Member for Dagenham (Mr. Parker), about Heveningham. I have much affection for Heveningham, because I live and was brought up nearby, for to take into national ownership a house with the obvious problems of Heveningham and the tremendous expense inherent in its upkeep had to be a mistake.
  The trustees of the new fund must look not only at the merits and the value of a building but at the continuing financial commitments that will be involved. We in Suffolk have never been very bright, but one did not need to be bright to know that we could not keep up Heveningham Hall.
  The trustees must be independent of the Treasury, and I should not like to see Ministers use their bounty quite as regardless of national appointments and trends as the Bill would allow them to do. I should like to see a few ex officio appointments among the trustees. It might be sensible to include the chairmen of the Arts Council, the Countryside Commission, the Architectural Association, perhaps even the Royal Society, and their Scottish, Welsh and Northern Irish counterparts.
  I am concerned about the power of veto that is given to Ministers. Such powers should not be vested in Ministers and, above all, not in Ministers as casually chosen as the two mentioned in the Bill. The present holders of office may be the right people, but the Bill still gives them more power than a bad man should have or a good man should need.
  I should like the powers of veto by the Government and Ministers to be reduced to an absolute minimum, and the Government should re-examine the powers of the trustees provided for in clause 6. That might be a useful point to pursue in Committee. I am concerned that people do not die as conveniently as the Bill suggests they might. It is wrong to suggest that every year about £5½ million worth of proper, true blue, recognised and accepted treasures will come onto the market.

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  It is far more likely, as we have all noticed at by-elections whence always manage not to get the right people dying in the right constituencies, that there will come one year when enormous treasures will come on to the market and another year that will produce a dearth.
  I want to see more flexibility provided in the Bill. If we have trustees properly selected with expertise at their command, they should not be restricted to the Trustee Investments Act and the terms of clause 6. They must be allowed to invest in whatever they know about—as the trustees of the National Land Fund were not allowed to do, as a result of which cumulative interest of less than 1·6 per cent. was realised on that first £50 million.
  Perhaps there should be a special category of national heritage for objects about which the trustees are not unanimous. No doubt there will be many objects in whose cases some trustees will say "Yes" and others "No". It would not be difficult to create a tax incentive or some small way in which the spirit of the Bill could be achieved—and that spirit is that our heritage should remain in our country.
  Before we reach the Committee stage, national experts should be allowed to consider whether, before an item is allowed to leave the country, it should be made slightly easier to find people here to purchase it. If thereby there is a concession in the tax rate, as there is under the Waverley rules at the moment, we should encourage it.
  I am steadily sceptical about getting back what has already gone away, and we should consider very carefully before we allow a repetition of the Axel Springer type of bequest. I suppose that that bequest may one day get back if the beneficiary does not, in his own country, have some law passed whereby treasures must remain in situ, but I should like to see us keep what we have, and the spirit of the Bill is what, even with the limited amount of money available, ought to be achieved. If it is achieved by the odd tax concession, we shall give it our blessing.
  7.22 pm
  Mr. David Price: Like all other hon. Members who have spoken in the debate, I welcome the Bill, particularly because we have been waiting 33 years for it. I regard it as the fulfilment
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  of Hugh Dalton's ideal. I think that we can all agree on that. On both sides of the House we are anxious, as has become clear, to do right by the national heritage. This immediately raises two questions. First, what do we mean by "national heritage", and, secondly, how do we as legislators do right by that national heritage?
  I welcome clause 3 of the Bill because it gives a definition, in effect, of the national heritage. I ask the hon. Member for Isle of Ely (Mr. Freud) to mark the words in clause 3 which, I believe, cover the point that he raised about the landscape. It so defines the national heritage as to include
  "any land or building which in the opinion of the Trustees is of outstanding scenic, historic, aesthetic, architectural or scientific interest".
  That is a pretty massive definition, and I welcome it. I defy hon. Members in Standing Committee to find what is missing in it.
  In the spirit of this debate, I believe that the definition should be massive and all-inclusive. Let us add a few figures to it. Let us take buildings as an example. Through recent parliamentary questions, I have learnt that there are some 7,500 grade I listed buildings in the United Kingdom. There are also some 280,000 grade 2 listed buildings. That is a very large number of listed buildings. Superficially, all are potential candidates for the sort of rescue treatment proposed in the Bill.
  Hon. Members have referred to the question of land, so I turn now to the question of nature conservancy, particularly in relation to land use. I know that the hon. Member for West Lothian (Mr. Dalyell) is very much with me on this matter. It is clearly included in the term "scientific interest". The "Nature Conservancy Review" has identified 735 key sites—its own phrase—of national or even international significance. But only about 20 per cent. of the area of those 735 sites is currently protected by designation as national nature reserves.
  "National heritage" is an omnibus term that includes a vast variety of objects and activities which matter to us as British citizens. I therefore welcome the fact that the clause 3 definition includes the concept of associated objects. The hon. Member for Caerphilly (Mr. Hudson Davies) mentioned Van Dycks.

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  There is a very good case in my own part of the country, near Salisbury. The Van Dycks of the Herbert family are an integral part of Wilton House, and it would be a tragedy if, at any time in the future, supposing that that great house came up to be sold, those Van Dycks should be taken from Wilton House, stashed away and put in some public gallery in London. It would be quite wrong. That message comes clearly from all of us who have examined these problems, and that is quite apart from the question of why everything of merit has to come to London anyway—a question about which all of us provincial Members feel strongly.
  The national heritage is not simply static works of art. It also involves a dynamic aspect, the living tradition. We have excellent examples in the theatre, opera and music-making. They are all part of the national heritage. It also includes making relevant contemporary use of old buildings.
  There is an example in my constituency at Romsey. An early medieval building called King John's House is now being used for poetry reading, music-making and so on. The hon. Member for Warley, East (Mr. Faulds) will be pleased to know that even I perform there. I hasten to add that I do so purely as an amateur. The hon. Gentleman is always welcome to join us.
  We have to find, as far as we can, contemporary uses for old buildings. I am sorry that the Father of the House, the hon. Member for Dagenham (Mr. Parker), has left us, because I can tell him what we in Hampshire are doing with some old barns which are listed, finding contemporary uses for them when they are no longer needed for agriculture.
  We must look not only to preserving our national heritage but to nourishing it. We must make it flourish. We must strive to make it blossom. Therefore, we need not only the care of the curator and the scholarship of the antiquarian; we also need the green fingers of the gardener and, above all—I hope that I do not sound too emotional—the love of the public. That is and will be the most beneficent form of custodianship.
  How do we do right by the national heritage? Doing right means, in this context, doing right both by our predecessors and by our successors as well
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  as by ourselves in the contemporary generation. I recall the great defence of tradition made by the late G. K. Chesterton. He said that tradition was the truly democratic thing to do because one did not limit the suffrage to those alive at any particular time. That is a good way to look at the national heritage—not only backwards but also forwards in the general continuity of trusteeship.
  The preservation of the national heritage must be a partnership between the central Government, local government, industry and commerce, private societies and the individual citizen. The variety and permutations of those relationships are legion. I like to think that each of us, in his own part of the country, has experiences to throw into the common national pool of how to achieve our object. I hope that in Committee some of us will have the opportunity to share our thoughts on this important subject.
  There is no absolute answer to the question of how we do right by the national heritage. Obviously, public and private moneys are necessary. I draw the attention of those narrow money men who seem always to come in and rule our destinies to paragraph 62 of the report of the Expenditure Committee, which refers, as have three hon. Members already, to tourism. It states:
  "The national heritage is the single most important aspect of Great Britain that attracts tourists".
  It adds:
  "It is the quality and variety of Britain's national heritage that tourists, whether foreign or indigenous, enjoy. It is essential that it remains available."
  The hon. Member for Isle of Ely quoted some further figures. Whether we accept the higher or the lower, there is a clear case here. Let us convince the narrow money men that whatever method of calculation happens to be the in one to use, and it varies from decade to decade—cost benefits studies or whatever—this is about the best investment that we can make with our public money.
  Having said that, I come to the sorry story of the National Land Fund. I shall not go over it again, because many hon. Members have already accounted it. Suffice to say that between 1946 and 1979–between Hugh Dalton and my right hon. Friend the Chancellor of the Duchy of ancaster—there have been 33 years

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  of plunder, deceit and neglect. That may sound a harsh judgment, but those who read the admirable third report of the Expenditure Committee, or those who do not have the time to read the full report but yesterday read Christopher Brasher's article in The Observer properly entitled "Stopping the Great Land Robbery", have it all there. As Christopher Brasher rightly pointed out, the £50 million of Hugh Dalton's fund would at 1979 prices—without going into all the permutations on interest rates—be about £400 million today. Where has the £400 million gone?
  It is true that the National Land Fund was a capital sum. It is true that my right hon. Friend is offering £15,500,000 to get the National Heritage Fund started and subsequently £5,500,000 each year. If one does a modest calculation, and assuming—and this is a great assumption—a zero rate of inflation, one will discover that it will take 70 years for the National Heritage Fund to reach the financial strength of the National Land Fund when it was set up in 1946. That
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  would take us to the year 2049. I suspect that few of us here today will be left in the House to challenge that. That means that it will have taken 103 years to get back to the position at which Hugh Dalton first started the National Land Fund.
  Some hon. Members believe in progress. I always think that it is a doubtful concept, but I am sure that we all oppose regression, and this is clear regression. My right hon. Friend will have to do a lot more talking to the hard, narrow money men to make this fund the success which we are all determined it should be. Knowing that his hope and faith, like mine, is always eternal, and that he and his successors in office will succeed with the new National Heritage Fund where the old fund failed, I should like to conclude with the words of a great Cambridge poet, Rupert Brooke, whose sentiments my right hon. Friend and I share:
  "Honour has come back, as a king to earth.
  And paid his subjects with a royal wage;
  And Nobleness walks in our ways again,
  And we have come into our heritage."
  7.33 pm
  Mr. Tam Dalyell: The hon. Member for Eastleigh (Mr. Price) referred to the countryside aspects of the heritage. Perhaps I can put the first of a series of questions that I think should be cleared up before we go into Committee. The Countryside Commission for Scotland feels that it should be enabled to receive land acquired through the National Heritage Fund in appropriate circumstances. The wording of the provision relating to eligible recipients would appear to embrace the Commission in relation to its existing limited land-holding powers. In the event of the Commission being given wider land-holding powers in the new countryside legislation that is being considered by the Government, it would appear that this, too, would be satisfactory.
  In this connection, the Commission also sought to ensure that voluntary organisations, such as the Scottish Wildlife Trust and the Scottish Youth Hostels Association, should be enabled to be the recipients of property acquired through the National Heritage Fund. It is not absolutely clear that these bodies will be eligible, as this will depend upon their having in their constitutions purposes for the provision, improvement or preservation of amenities enjoyed or to be enjoyed by the public, or the acquisition of land to be used by the public.
  My first question is whether the Minister can say anything about the countryside aspects that were touched on by the hon. Member for Eastleigh, because that is certainly a cause of some concern outside the House.
  Secondly, I should like strongly to agree with my hon. Friend the Member for Dagenham (Mr. Parker) that the Laxton position has a wide interest well firth of Nottinghamshire and the Nottinghamshire Members of Parliament who have tabled an early-day motion on this subject. This is a British issue, not a Nottinghamshire issue. It would be no dishonour to the Government if they were to say that on reflection, after all the fuss that has been made by the House of Commons, they intend to retract that decision.
  Thirdly, I should like to raise an issue that was raised by the hon. Members for
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  Kidderminster (Mr. Bulmer) and for Isle of Ely (Mr. Freud), without going over the whole story of the Land Fund to which other hon. Members have referred. I think that there is something of an issue here. Can one just say "Goodbye" to the war memorial aspect of this issue? After all, it was not Dr. Dalton's fault. As I understand it, it was the decision of the post-war House of Commons, supported by all parties at that time, to provide a national memorial, in memory of those who died in the Second World War. It remains a very live issue as to whether, some decades later, one can just sweep under the carpet the memorial aspect of all this. I want to be constructive about it. I hope, possibly in all parts of Britain, that certain properties will be earmarked as memorials in the way intended by oar predecessors in the second half of the 1940s.
  Mr. Alexander W. Lyon: As I understand it, what Dr. Dalton had in mind was not so much country houses but open moorland and open space which would be easily available to members of the public. I think that that would be a suitable memorial.
  Mr. Dalyell: That was my understanding of the position. That is why I couple this with my opening remarks about the countryside aspects that concern the Countryside Commission for Scotland and, doubtless, many other bodies. Certainly, there is no dispute between my hon. Friend and myself on that issue.
  I now come to a slightly jarring note. I think that hon. Members would agree that, possibly, of all our colleagues I am the least given to Scottish nationalism. But when I heard the Minister going on about the virtues of the English National Trust, to which I willingly accede, without a mention of the Scottish National Trust, where director James Stormonth Darling and his colleagues have done much pioneering work, it jars even on me. I do not say that it makes me into a nationalist, but some of us have thought for a long time that it is that kind of ill-thought-out statement that creates the problems which, heaven knows, this House spent four years discussing.
  The Under-Secretary of State for the Environment (Mr. Hector Monro): As a card-carrying member of the National Trust for Scotland, I can assure the hon. Gentleman that it will not be forgotten when I reply to the debate.
  Mr. Dalyell: I welcome that assurance. I must now say that much of the meaty speech that I shall offer to the House is the result of two meetings that were called by the National Trust for Scotland, one five weeks ago and the other on Friday at five o'clock. Indeed, many of the hard items about which I am asking come from the meeting that was convened at 5 Charlotte Square rather than out of my own imagination.
  The first issue, which I raised in an intervention, is whether the Secretary of State for Scotland should be one of the appointing Ministers. In clause 1(2), the appointing Ministers are said to be:
  "the Secretary of State and the Chancellor of the Duchy of Lancaster".
  It is understood that that is intended to meet the case of the Secretary of State for the Environment acting with the Chancellor of the Duchy of Lancaster. However, it is desirable that the Secretary of State for Scotland should be an appointing Minister. As I warned the Chancellor of the Duchy of Lancaster in his opening speech, I should like a statement on that matter.
  The reason for making the Secretary of State for Scotland an appointing Minister is not just to satisfy a quibble, nor is it an expression of Scottish pride. It is because, in the real world, there is a need to ensure that the Scottish contribution to the national heritage is properly and adequately represented on the National Heritage Fund trustees. The Secretary of State for the Environment has no responsibility for the conservation of scenic interest in the Scottish countryside. That is only one example. Therefore, we are concerned that the Secretaries of State for Wales and Scotland, who are shown as sponsors of the Bill, should be regarded as appointing Ministers. We were concerned about how they would be consulted in the working of the Bill. I am sure that the matter can be easily cleared up.
  Clause 3(1) deals with the question of enabling. I wonder whether the word
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  "assisting" could not be read narrowly to rule out 100 per cent. grants whereas "enabling" is sufficiently broad to stand by itself. "Assisting" implies partial help only, whereas "enabling" is more the word we want, as it is envisaged that the trustees might make 100 per cent. grants for the acquisition of property in certain cases. In this clause the words "acquire, maintain or preserve" go practically all the way. However, I should like to see the words "or endow" added to those words. After all, in the Historic Buildings and Ancient Monuments Act 1953, in section 4, grants for the preservation of historic buildings, their contents and adjoining lands are dealt with. Section 2 of that Act deals with grants to the National Trust and states that the grants can,
  "if the Minister thinks fit, be made by way of endowment".
  In other words, there is a precedent for the use of the specific word "endowment" in that Act. I should like to see it written into the new National Heritage Bill. That would make it clear that endowment funds are permissible, if the trustees so wish.
  Clause 3(1)(c) deals with an issue that was touched on by the hon. Member for Eastleigh. It refers to:
  "any land or object"
  I believe that the additional words:
  "allow money to be made available for acquiring, maintaining or preserving the natural habitat associated with a building or structure"
  are required. That would enable woodlands, plants and animals to be taken over and looked after.
  The issue is raised of whether we are concerned with horticulture and gardens. A great number of gardens of national importance are in desperate need of financial help. Some are attached to historic houses while others are on their own, but they should be eligible for grants from the fund. Parliament has already decided that outstanding gardens come under the definition of land of scientific interest. In certain cases they might come under the heading of land of outstanding scenic interest. Nevertheless, it will be helpful if the word "horticultural" can be added in clause 3(1)(a) to clarify the position. Frankly, I do not expect a "yea" or "nay" to that matter tonight. However, it would be helpful to know the

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  Government's general attitude before the Committee stage.
  Clause 3(5) enables the trustees to accept gifts. Will such gifts be free of both capital transfer tax and capital gains tax? If trustees are empowered to accept such gifts, it should be possible to encourage donors to make them. In clause 3(1), does the word "maintain" give power to grant annual maintenance grants for the day-to-day running of property as well as capital maintenance grants? It is important that a statement should be made in the winding-up speech on the Government's general philosophy towards whether money should be made available for running costs rather than major capital costs. It is often the case that comparatively small running costs are extremely important. I say that as a member of the council of the National Trust for Scotland.
  It is important that in clause 3(1) there should be clarification that the words include the power for the trustees to make 100 per cent. grants which would enable rather than assist. There is also the question of the power of the trustees to make annual or periodic maintenance grants towards revenue deficits as well as capital grants. Also, I have raised the question of the power of the trustees concerning the endowment of a whole property. It is important that the trustees can help, by way of a consortium, towards annual maintenance and that they can encourage others to help towards endowments. Will the trustees be acting like the Pilgrim trustees who have the power to give certain help but not total help? No doubt, that matter will be pursued in Committee.
  I should like clarification of the phrase:
  "by or for the benefit of the public".
  Does that phrase cover a wildlife sanctuary? Entrance to a wildlife sanctuary may well be limited. Indeed, in certain manor houses to which my hon. Friend the Member for Dagenham referred in his speech, it may not be sensible to encourage maximum visiting on some occasions. Does the phrase include the concept of people being able to visit on occasions but that such visiting will be limited?
  On clause 3(6), it is the view of John Imre of the Scottish Records Office and it
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  is the view of the British Records Association, as keeper of the records, that archive institutions should be eligible recipients. Presumably, the Bill was drafted for the arts departments. Will similar eligibility apply to archive collections as well as museums and galleries? Mr. Imre attended the meeting held to discuss the Bill that was organised by the Scottish National Trust last Friday. He would like to see the Scottish Record Office and the Public Record Office in London included in schedule 2, part I.
  I come to an extremely important issue, which has been referred to by the hon. Member for Staffordshire, South-West (Mr. Cormack), my hon. Friend the Member for Caerphilly (Mr. Hudson Davies) and a number of others, concerning the question of allowing objects to be left in situ. To take an example, Hopetoun House in my constituency is frequently opened to the public by Lord Linlithgow. Since the 1914 war many houses have been demolished and their contents dispersed. In addition, many more have lost furniture and decorative items specifically designed for them, due either to family division or to their being disposed of in sale rooms. Comparatively few great houses still contain their original furniture and fittings, and hardly any of the more modest gentlemen's houses survive intact.
  It is the professional opinion of David Learmont, the curator of the Scottish National Trust, that at Hopetoun 95 per cent. of the furniture, looking glasses and girandoles remain in the house, but even here there are one or two unfortunate gaps in the suite of furniture that James Cullen supplied for the house in the middle of the eighteenth century. One of a pair of very high-quality night tables designed for the state bedroom has gone, to give but one sad example.
  The quality of the furniture at Hopetoun is unquestionable, wherever it is displayed, but Mr. Learmont would submit in his professional capacity that its real importance lies in the fact that it is still in the house for which it was designed. Moreover, in recent years it has been restored to its original position. One could say that it forms part of the original architecture.
  In less important houses, the quality of the contents is not quite so obvious,

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  but in many cases the furniture would have been supplied by a prominent provincial cabinetmaker, and it plays an equally significant part in our heritage, as does the great house with its elaborate contents.
  Portraits painted by local artists of considerable talent often adorn the houses of lairds and of the squirearchy, and they are part of the country house scene. Once they become dissociated from their original places of display, they lose a great deal and tend to rank with the ordinary and commonplace. No local museum or art gallery, whether national or provincial, can ever quite take the place of the domestic setting with all its historic associations.
  Are the Government satisfied that the Bill covers the whole question of putting valuable and especially not so valuable treasures at an advantage in situ? The break-up of collections must concern us all.
  I am glad to see that in clause 5 the Bill makes provision for acceptance of gifts. It may be that under other legislation such gifts would be exempt from all taxes such as capital transfer and capital gains tax, but I should like to see that made clear to encourage gifts to the National Heritage Fund. Further, has it been assessed whether bequests and legacies to the National Heritage Fund would mean that such bequests might not go to other charities in the same field? There might be competition here, and I should like to know whether the Government have considered that.
  Clause 3(6) deals with eligible recipients and appears to be widely drawn. I am glad to see that in subsection (6)(b) the old wording used by Hugh Dalton has been carried forward. Does subsection (6)(a) cover such bodies as the National Trust and the National Trust for Scotland? I should like to think that it also includes charitable trusts such as the Scottish Wildlife Trust and the Royal Society for the Protection of Birds. Perhaps the Minister will deal with those matters.
  The purpose of the Bill is to preserve and care for the national heritage, but nowhere is the national heritage defined. In the past there have been discussions in the House of Commons and the House of
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  Lords as to what it meant. On 12 July 1979, in the Lords debate on a Bill that was promoted to deal with these matters, Lord Reigate said that the trees, flowers and wildlife conservation and so on should be looked upon as part of our national heritage. He said that he would like to see this point being considered and possibly the Bill extended if, in the view of the Government lawyers, it needed to be extended. Buildings needed their context for full public enjoyment and the countryside needed its trees and flora and fauna for its full enjoyment. I could not put the matter more simply. If the National Heritage Fund is to be used to help preserve the contents of buildings, as it will, surely it should also help to preserve everything that makes the countryside attractive for the benefit of the nation and the enjoyment of the people. I am speaking at some length on the matter because I should like to see an amendment—preferably from the Government—to cover in general terms wildlife conservation on land which in its own right is worth preserving or is adjacent to historic buildings.
  The Bill makes clear that the fund can be used to preserve land, and in Scotland at any rate "land" includes everything growing on it, which I assume would cover forestry activity. I believe that the specific point about wildlife conservation could be brought into the Bill. The Scottish National Trust lawyer, George Russell, has gone into the matter in some detail, and it is a substantial point. It would be preferable for the Government to bring forward an amendment, if they concede that clarification is necessary, rather than have an extended Committee stage.
  I intervened to ask the Chancellor of the Duchy of Lancaster about stamp duty, and that brings me to clause 9. Will stamp duty extend to private treaty purchases made by the fund or by those bodies that it assists with grants? Will acceptances-in-lieu be exempt, even if the duties of the Ministers are passed over to trustees, as in clause 14? If there is a general switch from acceptance-in-lieu to private treaty sales stamp duty, charities will increase and there will be a need to fund the trustees additionally for that purpose. That point was put by Mr. Jeremy Benson, who has been helpful to hon. Members on both sides of

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  the House and who over the years has been of extreme help to conservation bodies. Mr. Benson points out that, although it is possibly a bit of a quibble, the generous thing would be to exempt all purchases by private treaty, whoever may make them, from stamp duty, to the extent that they are made with National Heritage Fund money—that is, a 50 per cent. grant bringing in a 50 per cent. exemption. To be really generous, all private treaty sales made by museums, if eligible for National Heritage Fund grants, should be totally exempt from stamp duty. I shall not quibble if the Minister says that stamp duty is a matter for Committee, but it is important.
  Mr. Benson also makes the point that it seems that VAT will be payable by the trustees on any works on repairing buildings in their ownership. It will also be payable by some of those who receive grants from the trustees to carry out repairs. In contrast, the Department of the Environment will not pay VAT if it repairs a building that it has purchased or if it accepts one in satisfaction of tax in future. In that confused situation, it would be preferable to exempt the trustees from payment of VAT. It is difficult to imagine that they would ever have to charge VAT and so have a credit to set against tax payable by them. It might seem an esoteric point to raise on Second Reading, but Mr. Benson, with his customary courtesy, has given the Department a copy of the paper, and perhaps there has been discussion on that point.
  A point that I am concerned about and which also concerns Mr. Stormonth Darling, the secretary of the Scottish National Trust, is whether the National Heritage Fund is to be considered a heritage body for total exemption of CTT and CGT under section 6 of the 1975 Finance Act. It may be that the Minister in his reply can clear the air here and say that there is total exemption. That would certainly help us before we start to table amendments to the Finance Bill.
  The National Heritage Fund is intended to provide a mechanism to secure for the nation a property of national importance by meeting the tax liability arising and due from a taxpayer. The tax is due and must be satisfied, and the fund is intended to provide a means
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  of doing this. I understand that that is the position. I may be a bit thick about this and possibly should have grasped the position from the opening speech by the Chancellor of the Duchy of Lancaster, but some other people are also not clear as to what exactly is the position about moneys in lieu. This has not been made abundantly clear, or crystal clear. At least, it has not sunk in to some of us. Perhaps it ought to have sunk in. It would be helpful if a statement could be made as to precisely how the money that is being made available is affected by the in-lieu clauses, because this could affect very considerably the amount that is available for the purposes with which we are all concerned.
  I turn now to a matter which will doubtless come up in the discussion of the Finance Bill—exemption from corporation tax. I am asked why we have to wait for the next Finance Bill, for example, to consider the question of gifts to the trustees under CTT and CGT. What about CGT on sales to the fund? Here we are not clear as to what happens. There might, for instance, be a sale to the British Museum. This might be complicated by the possibility of a sale of a totally unencumbered object and one already held under conditional exemption.
  This brings me to the vexed question of indemnification. Either of the Ministers concerned may indemnify, and presumably this also applies to the Secretary of State for Wales and the Secretary of State for Scotland. The Ministers find the cash, do they not, if they have to compensate someone else after a loss, by way of Supplementary Estimate? Does this compensation come out of the National Heritage Fund? In the first year the £15·5 million is split by the Ministers, and perhaps, if somebody has to be compensated, the trustees would then get less in consequence.
  I also raise the question whether in the Bill the word "indemnify" in the explanatory statement is confused with the word "compensate" in the first paragraph. It might be helpful to explain at some stage why the parliamentary draftsmen have chosen "indemnify" in one context and "compensate" in another.
  I make no apology, Mr. Deputy Speaker, for having put forward the fruits

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  of the meeting that the Scottish National Trust took the initiative of convening last Friday and the thoughts of many people in Scotland who have given a considerable amount of their time and their legal, professional and architectural expertise to the Bill.
  I will accept what the Chancellor of the Duchy of Lancaster said—that out of small acorns grow great oak trees. But all of us here tonight would wish, if we are involved in the Bill and take an interest in these things, to be party to getting it right first time. It is a fact of parliamentary life that it is much easier to say all these things on Second Reading, to state one's worries and then to hope that before the Committee stage takes place—especially if it is to start in the last week before Christmas, which will not give us much time—the Government will come forward with appropriate amendments.
  If I have spoken at length tonight and taken up more than my share of time, Mr. Deputy Speaker, it is in the hope that in the cold light of day the Government lawyers and the parliamentary draftsmen will sift through the points that have been made and perhaps come up with Government amendments that will save us a great deal of time. That is, on the whole, far more satisfactory than having Back Bench amendments, imperfectly drafted and without the legal expertise that is available to the Government.
  I say to the right hon. Gentleman, who has patiently sat through my speech, that I hope my reward will be a series of Government amendments which will be on the Order Paper before we start the Committee stage of the Bill.
  8.5 pm
  Mr. Christopher Murphy: When one discusses the subject of the heritage, there is an almost inevitable phrase that is brought forth on such occasions—"the quality of life". But I venture to suggest that this should not be treated as simply rhetoric. It is a fundamental concept that is a valuable component of Conservative thinking and one which clearly infuses the Bill.
  The beliefs of those of us on the Government Benches have at their central core the view that the freedom and re-
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  sponsibiiities of the individual should the focal point of attention to which the State is an adjunct, not a goal in its own right. As part of that recognition of the importance of the individual, we accept that the conditions in which he enjoys his life, and in which he maximises his opportunities, are a legitimate concern for the Government.
  Education and social services are obvious examples of this, but equally an understanding of the importance of culture in the widest sense of that word is needed. The role of the arts and of our heritage is fundamental to the future condition of our society and of the individuals who are its components. The quality of life demands that we should support that which enhances the individual's understanding of himself and of his society. Conservatism holds that the character of the cultural benefits that our heritage can provide for that individual.
  The Bill will add to the framework of society which provides the opportunities for the individual to exercise his freedom and his rights. Legislation such as this gives due attention, as it rightly should, to the cultural benefits our heritage can provide for that individual.
  I hope that the advantages of such action on the part of Her Majesty's Government are apparent to all but the most philistine of critics. There is the conservation of that which has intrinsic value, both aesthetically and historically; and there is the educational need of preserving for future generations the achievements of our predecessors, both artistic and skilful. In addition, there are economic aspects which cannot, nor should, be ignored in terms of the importance of tourism to our country; and there is the impact upon our lives of the increase in leisure time.
  The Bill seeks to provide the opportunity to protect important strands of the essential fabric of our nation. It seeks to defend our national heritage within broadly defined parameters. It seeks to preserve both countryside and building, both natural and man-made beauty. It seeks, in short, to raise the quality of life.
  In welcoming the Bill, I can do no better than to conclude by quoting from the election manifesto on which the Government were so decisively elected:
  "We favour the establishment of a National Heritage Fund to help preserve historic buildings and artistic treasures for the nation."

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  Yet another election pledge is being fulfilled by the Chancellor of the Duchy of Lancaster, and I am privileged to be able to give him my full support in helping to secure this measure.
  8.9 pm
  Mr. Alexander W. Lyon: I was a member of the Select Committee which was the parent of the Bill, and therefore I would also like to welcome its introduction, although it differs a little from the recommendations of the Select Committee.
  I soon found, when we came to discuss this somewhat complex subject, that the heritage lobby is at least as vociferous as the animal lobby, but probably not quite as vociferous as the university teachers in support of their pay claim. But that it was a lobby that was single-minded in its devotion to what it thought was the injustice of the National Land Fund made it sometimes a little obscure in its reasoning.
  When the matter came to be sorted out, after we had heard both sides of the argument, it became clear that the National Land Fund which was set up in 1946 was an allocation of money to Government stock, and entered as such in the Treasury books, and that very little use was made of it until 1957, when the Public Accounts Committee had recommended that the original £50 million should be repaid to the Treasury and that the interest which had accrued should be all that remained.
  That being so—that is the surviving amount of £15½ million which is the basis of this National Heritage Fund—there never was any question in my mind that we were talking about a public expenditure of £50 million in 1946 which had been hypothecated by the Treasury for a particular purpose. Of course, the Treasury would never admit it and I could not persuade the Select Committee to assert it, partly because the Committee did not like the word "hypothecated" but also because it thought that it would put the Treasury's back up.
  But the truth is that this is one instance in our recent history of hypothecated income. That is something that we should use in future. The purpose of a particular form of income can sometimes, with great merit, be a particular form of expenditure. I should like to see the BBC
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  financed in just that way, by raising expressly through taxation a certain sum which would go to the BBC without any interval in between. I should not like that point to be lost in our general welcome of the Bill.
  Although I share with all those in the heritage lobby—many of whom are represented here today—the general sense of admiration for what we talk about as "the heritage" and a sense of the importance to our cultural and social life of the heritage in its widest sense, I do not believe that we can appropriate land, art or property generally to a position which takes it outside the realm of priorities of any Government's spending programme and sets it above the needs of the old-age pensioner or the hospital service or any other item of public expenditure.
  Therefore, it was necessary to preserve the distinction between a decision about how much was available at any given moment to be spent on the heritage and what use that money should be put to in deciding among the many demands upon such a fund and the priorities to which it should be allocated.
  The House will have noticed from previous speeches that so many demands have been made upon the prospective £5 million a year that the trustees will simply not be able to meet them in anything like full measure. Inevitably they will have to ask themselves not "Is this good?" but "Is this so good that we ought to spend our small amount of money on securing it for the nation, as against something else which might have great worth but may not be quite as fruitful for the nation as a whole?"
  That decision, which in essence is one of artistic merit, has to be determined by people with a very different kind of mind and prospectus from those who have to decide how much money is available in the first place. For that reason, I was all in favour of creating a heritage fund with trustees who had artistic qualifications to decide what they regarded as of the highest priority and what was not of such priority, and leaving to the Treasury the issue of how much should go to the fund, to be decided on the merits of overall public expenditure priorities. I am glad that, on balance, that is the way in which this has come out.

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  I feel that there was something to be said for the Labour Government's White Paper, which would have abolished the in-lieu provisions and allowed the fund to make its assessment of what it desired to buy when estates came up for death duty or for capital transfer tax and to make provision within the allocation to the fund so that it could make that kind of judgment and buy from estates.
  I think that that was a better method than simply allowing the Treasury—or, in this case, Ministers—to go on asserting that a particular picture or house was of such outstanding merit that it could qualify for the in-lieu provisions and thereby deprive the Treasury of resources which would have come to it as a result of CTT. That again is to mix up the two completely separate types of decision making, namely, the artistic provision and the amount of expenditure that should take place.
  To some extent, that is confused by the way in which the Bill is drafted, but the transfer of those functions in due course from Ministers to trustees, which is at least a power retained under the Bill, means that in time, as people begin to see how irrational it is that the Treasury or Ministers should make those artistic judgments, the objective that I was seeking would come about.
  For that reason, I was prepared to agree to the unanimous recommendations of the Select Committee report that there should be a National Heritage Fund and that it should take over the outstanding money in the National Land Fund, but I was not prepared to go further in terms of future revenue than saying that that should be a matter to be determined by the Government of the day, in line with their overall spending priorities—save and except, a little under pressure, that I thought that it might be right that the original £50 million should be made up again, since it should never have been taken from the National Land Fund in the first place.
  When we say that, let us remember, despite what was said by the hon. Member for Isle of Ely (Mr. Freud), that the plunder and atrocities were committed not by civil servants or Treasury Ministers but by the recommendations of a Select Committee of this House. It is fitting that we should deal with a certain humility with wrong judgments of the past.
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  The upshot is that the original sum, whether it remains £15 million or is the original £50 million, is an allocation which was made by the Government in 1946.
  The public expenditure commitment was in 1946. Any notion thereafter that anything paid out of it was a further addition to public expenditure is nonsense. Yet we have not been able to persuade those in the Treasury of that, even today. They go on insisting that the National Land Fund was only a separate entry in the accounts in a different area of the books and that the money did not actually exist.
  If the money did not exist, it is difficult to see how interest accrued over a period—albeit somewhat limited interest since the money was in Government stock. The truth is that it was an expenditure and it was made in 1946. The importance of the point is that the £15 million which will be the basis of the National Heritage Fund will count against the right hon. Gentleman's Vote as public expenditure this year. As such, it comes within the Government's cash ceilings on overall expenditure.
  That means that £15 million, which otherwise could have been made available for something else, will not now be made available. It may be that this is too abstruse a point for the House to take in at 8.20 pm on a night when the Chamber is empty. All the same, £15 million in present circumstances is a lot of money. There are a number of spending programmes which could usefully benefit from an extra £15 million. I know it is late in the day for the Minister to consult his right hon. Friend, but we are told that there is to be a further attack on public expenditure.
  This £15 million ought never to have been brought into the net. It was never money which the Government could properly describe as public expenditure. The truth is that the £15 million was not available for disposal by the Government. It had been hypothecated back in 1946 and should never have been brought into the net of public expenditure now. For that reason, the right hon. Gentleman has something of an argument to use against his right hon. Friends when the allocation of resources is being considered in future. I would give him a great deal

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  of support if he were to keep the extra amount for this particular purpose.
  I admire much of our heritage, and though I like to go and see the great houses of England and walk the areas of moorland we have been discussing, I think that there are many other pressing demands on public expenditure. The pleas of Conservative Members that stately home owners are in real difficulty and need all kinds of concessions in capital taxation to enable them to live in their houses fall on my ears with less effect than they do on the ears of some hon. Gentlemen.
  Sir Robert Cooke told the Environment Sub-Committee, with great pain and anguish, about the plight of those living in stately homes with bad plumbing and bad central heating. When there are many people in this country without adequate roofs over their heads, I weigh their plight in the balance against the maintenance of the heritage and the people living in it.
  I am sorry that I am not part of the general consensus which was quoted by the hon. Member for Staffordshire, South-West (Mr. Cormack), but I do not accept the advice given in another place by a Labour Minister that the best way to look after the heritage is to leave the people whose ancestors obtained their property by various means in possession of it.
  Mr. Faulds: If my hon. Friend has studied these matters, does he not understand that what he suggests would eventually lead to a situation where we would have, as they do in France, dozens of empty houses bereft of people, bereft of furniture and a bloody bore to go round? Cannot my hon. Friend take that point?
  Mr. Lyon: I have never been able to equate my language with that of my hon. Friend the Member for Warley, East (Mr. Faulds). Whether the stately homes are a sanguinary bore or not, the fact is that a considerable number of stately homes in England are in that position. They are, nevertheless, extremely interesting houses to go round. I have not found—exceptin two houses—that the fact that I have to walk around on a carpeted footway between balustrades put up for the day makes the house more intimate than if the balustrades were there permanently and the family did not use the house on
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  the occasions when the public did not manage to get in.
  In assessing the beauty of a house and the value of its contents, it does not matter too much whether people live there. Surely my hon. Friend is not suggesting that the Kremlin, with all its treasures, is not a place to which one goes on pilgrimage and to admire its treasures.
  Mr. Faulds: I reiterate that if the family has gone from a house the likelihood is that the furniture and the paintings will be dispersed. If my hon. Friend is saying that he thinks that that can be prevented, he should be supporting the creation of an even larger National Heritage Fund and not having reservations about its use.
  Mr. Lyon: On the contrary. I am glad that my hon. Friend raised the issue, since obviously I have not communicated what is on my mind. I shall try to do so. If the State is prepared to buy a stately home with all its contents and to preserve it, it may do the job better than a family could on its own. There are plenty of examples of improvements taking place after a property is transferred from a family to the State.
  I am anxious that such houses and their contents should be preserved, but I do not necessarily accept that that is best done when the original owner still lives there. The State's funds should not be used to provide more salubrious living accommodation for people who have inherited a house and its contents. There could be exceptions. I merely argue against the principle.
  We must decide how much of our total resources should be spent on the preservation of the heritage. I do not accept private ownership as a sine qua non for preserving the heritage. I welcome the Bill.
  8.26 pm
  Mr. Richard Alexander: I have pleasure in contributing to this debate. It has been interesting if at times somewhat obscure and rarefied. We have all enjoyed it.
  Clause 5 states that, subject to the provisions,
  "the trustees may accept gifts of money or other property."

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  That is a good idea. We all like gifts. Under clause 8 the Commissioners of Inland Revenue may accept
  "any property in satisfaction of any amount of capital transfer tax".
  It is not clear whether the State can have two bites. If someone makes a bequest to the fund, will that be taken into account when assessing liability for CTT? I hope that it will.
  Loans by private individuals to national exhibitions should be given favourable treatment. While an item is on loan to a museum, the owner does not have the use and enjoyment of it, and yet on the owner's death CTT is leviable on the increase in value that has taken place in that time. I hope that some relief will be given to an estate in such circumstances. I think that that is the argument made by the hon. Member for Warley, East (Mr. Faulds), and I am pleased to have his support.
  Clause 3(1) empowers the trustees to make grants and loans out of the fund to acquire land. I draw my right hon. Friend's attention to the early-day motion in my name which has the support of hon. Members from the three main parties. It deals with the subject which was referred to by the Father of the House, the hon. Member for Dagenham (Mr. Parker)—the problem of the Laxton estate, in my constituency.
  Laxton is, without doubt, the last surviving village in the country with open fields which are cultivated in the same way as they were cultivated in the Middle Ages. The estate covers approximately 1,800 acres. It consists of 15 working farms, six smallholdings, four houses and a public house, where, incidentally, I celebrated my stag night many years ago. It was bought by the Conservative Government in 1952 from the Manvers family, with the declared intention of maintaining it permanently as part of our agricultural heritage.
  This land is unique. It is mentioned in textbooks. It runs at a profit. It is, I repeat, the only remaining example of how many of our villages have evolved over the centuries and how those who lived in them worked the fields prior to the enclosures. Parties of schoolchildren visit Laxton regularly, and people from abroad visit it regularly. It has been
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  described recently as the equivalent of Stonehenge. The crops are farmed in strict rotation. There is a court leet and farmers are fined a small amount if they stray from one strip of land to another.
  I was delighted that the Father of the House raised this point in connection with our national heritage. There is no one more enthusiastic than I am that the Government should not hang on to unwanted assets merely for the sake of it. But this land is part of the nation's heritage. There is no doubt about that. Its sale would fetch about £2½ million, or perhaps two days' losses from British Steel. The Government cannot shirk their responsibility for Laxton.
  The answer given by my hon. Friend the Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food in a written answer, in which he said that the estate would be offered only to those able to give the necessary assurances about the future of the system and the welfare of the tenants, is inadequate. That is no reassurance. First, it goes against the commitment given by the Government as long ago as 1952–a Conservative Government, after a period of Labour Government—that they would maintain the land permanently as part of our agricultural history. The proposed sale would go back on that assurance.
  Even if someone were able to purchase the land, would that purchaser be any more likely, for ever, to honour any assurance given? If the Government find it convenient not to honour the assurance given in 1952, and even if the purchaser honestly believes that he can maintain the land, circumstances could intervene whereby he would find it inconvenient for himself or his successors to continue this undoubted part of our national heritage in the way in which it has been continued for centuries past. There would be no one to enforce it, and by the time the Minister of Agriculture got round to doing anything about it the area could be ploughed over, and it could be enclosed.
  Fortunately, there is provision in the Bill for the Secretary of State or bodies such as the National Trust to receive grants to acquire, maintain or preserve areas such as Laxton. Therefore, I hope that if it is not possible to let the National Trust have it—I hope that that possibility

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  will be considered—the Secretary of State will take it over under this provision.
  Mr. Gordon Oakes: I hope that the hon. Gentleman does not misunderstand me. I am with him 100 per cent. in his attempt to retain the estate, which is unique, I think, in Europe. But surely he is not seriously suggesting that the Ministry of Agriculture should sell off the land and then use hard-pressed resources to buy it back again. That would be double-dealing of the worst order.
  Mr. Alexander: I am obliged to the right hon. Gentleman for his intervention. I had it in mind that under the Bill all that need happen would be a transfer from the Minister of Agriculture to the Chancellor of the Duchy of Lancaster or the Secretary of State for the Environment. I see no possibility of selling off the land, and I am glad that the right hon. Gentleman has made the point. I am very much with him on that.
  If we could transfer the land to the National Trust, the Secretary of State or the Chancellor of the Duchy of Lancaster, as the nation already owns it, they would be able to continue to run it at a profit. That would be for the benefit of generations yet to come. In that way we should not only be talking about our heritage, as we have properly done when discussing the Bill, but should be able to do something about it. The present position has lasted for the past 1,000 years. For 1,000 years to come people will be able to say that the 1979 Parliament, of all parties, managed to save Laxton for the nation.
  8.36 pm
  Mr. Jim Callaghan: We heard earlier about little acorns growing into large oaks. There is a Chinese proverb that a journey of 1,000 miles begins with but one step. Tonight the Chancellor of the Duchy of Lancaster has taken a very important step on a long journey, which will ultimately help our national heritage. Therefore, I heartily congratulate him.
  The establishment of the National Heritage Fund is undoubtedly one of the most important pieces of heritage legislation to come before the House since the war. It has been said that the Bill is simple in principle but complex in
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  detail. I agree with the latter part of that statement. Having sat through most of the debate, I should like to comment on, and ask questions about, parts of the Bill.
  The Bill seeks to
  "Establish a National Heritage Fund for providing financial assistance for the acquisition, maintenance and preservation"
  of
  "property of importance to the national heritage".
  I am sure that we all agree with that.
  The Bill also
  "amends the law concerning the acceptance of property in satisfaction of capital transfer tax"
  and empowers the Secretary of State and the Chancellor of the Duchy of Lancaster "to compensate certain institutions and persons if objects lent by them are lost or damaged".
  I wonder whether the liability for compensation for objects which are passed from one area to another in this country also applies to works of art loaned for exhibitions in other countries. Some time ago the Vatican authorities—I believe that the matter went as far as the Pope—agreed that a Michelangelo Madonna and Child statue housed in the Vatican might be sent on loan to the United States. The Vatican authorities accepted liability for the statue's safe arrival and return.
  Yet recently the Russian authorities asked us to send a work by Michelangelo to Leningrad on loan, in exchange for some Russian works of art, and the Minister declined. What was the reason? Was it the question of liability? Was the Minister afraid that in the event of damage or loss he would be liable? I should be most grateful if the Minister would enlarge on that.
  The Bill also provides for the abolition of the National Land Fund. That fund was set up in 1946, with £50 million allocated to it, as a public war memorial. I am sorry that it has had to be wound up. Nevertheless, that fund was to cover the acquisition of land in lieu of death duties or to help bodies concerned with the enjoyment of the countryside.
  The scope of the National Land Fund was extended by the Historic Buildings and Ancient Monuments Act 1953, and the Finance Act 1956 further extended the fund to include the acceptance of pre-eminent works of art. So the National Land Fund was the forerunner of the

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  Bill. Sadly, little use was made of that fund, which had grown to £60 million by 1957. In that year the fund was reduced to £50 million, and it is a pity that that £50 million could not be used today.
  As late as 1977, many hon. Members argued that the assets of the National Land Fund should have been used to save Mentmore and its contents for the nation. Because of the concern shown over Mentmore, public pressure has remained high about the need to change the system to prevent such a tragedy from ever happening again. Consequently, this matter was discussed by the Expenditure Committee and the Bill is largely based upon its recommendations.
  To prevent another Mentmore and the consequent loss to the nation of valuable works of art and paintings that are sold abroad, Ministers are to make annual payments into the National Heritage Fund. I have heard various figures bandied about during the debate as to the total sum of money. It has been mentioned that initially the sum of £15 million—the residue of the National Land Fund—will be placed at the disposal of the National Heritage Fund.
  I want to ask where this £15 million will come from. My hon. Friend the Member for York (Mr. Lyon) asked a similar question. Will it come from the National Land Fund, as we have been told, or will it come from the total allocation of funds to art? If that is where the money is to come from, it will obviously mean a net loss to other art institutions throughout the country. I ask the Minister to clarify that point. It has also been said that £5·5 million is to be given to the fund in each subsequent year. Again, will that £5·5 million come from the general allocation to art funds?
  The Inland Revenue has had some power to accept property in lieu of tax since 1911,so the idea put forward in the Bill is not new. If we look at the history of the matter, in only two cases was that power used between 1911 and 1946. The Finance Acts of 1975 and 1976 extended the provision of the capital transfer tax which replaced estate duty. That was a move in the right direction, and I shall say why. The system is beginning to work because the Benjamin Britten manuscripts, covering the whole range of his work, were accepted in lieu
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  of death duties and allocated to the British Library. A finer thing could not have happened.
  While I believe that the measures in the Bill will play an important role and help to ensure that our heritage is preserved, I feel that those measures could go further. I am sorry that the Chancellor of the Duchy of Lancaster is not present, because I should have liked to put one or two questions to him. Perhaps he will answer them subsequently. It is important that the Minister with responsibility for the arts should go further than he has done in the Bill. He should create a climate in which the arts of today, as well as those of the past, can flourish.
  I ask the Minister to give serious further consideration to the idea that donations to the arts from business groups or private individuals should be tax-deductible. I am sure that if this were done we should see more works of art coming into our national heritage.
  Moreover, ways of implementing a building cost percentage should be seriously explored. Hon. Members will know that in other countries, such as Italy and Germany, tax deduction is allowed on the building of, say, a new block of offices which can exhibit works of art or provide areas devoted to culture where people working in the building may go and admire works of art. I am sure that, if the Minister were to do something along those lines, it would be an enormous boon to the art world, and I hope that the idea of a building cost percentage can be further explored.
  For too long, Governments of both parties have regarded the arts as outside politics and as something of secondary importance worthy only of a tiny proportion of local government rates. I do not wish to be controversial, but one hon. Member speaking earlier from the Government Benches spoke approvingly of the Conservative manifesto. There are two sides to every coin, and one should remember that the Conservatives produced a document entitled "The Arts—the Way Forward" in which it was proposed that the arts should be exempted from public expenditure cuts because of the minute sums involved and the large-scale harm caused by even the smallest cuts.
  In this connection, I ought to remind the House that the Arts Council has lost

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  £1,114,000 because of the cuts, and that despite the Conservative manifesto. Moreover, local authorities are being affected. For example, the ILEA is suggesting the saving of £380,000 on staff-student ratios in arts centres, and the Wands worth local authority has announced its intention to close the Battersea arts centre.
  I did not want to mention those matters, and I should not have done so had not an hon. Member given praise earlier to the wonderful prospect offered by the Conservative manifesto.
  However, despite my criticisms, I wish the Minister responsible for the arts well in his term of office. I believe that the Bill will go a long way towards preserving the nation's heritage.
  8.47 pm
  Mr. Alastair Goodlad: I give a warm welcome to the Bill, and I congratulate my right hon. Friend the Chancellor of the Duchy of Lancaster on introducing it against a background of financial stringency. I agree with him that it is better to get the show on the road, albeit modestly, and to hope for better economic days to come.
  I join in the tributes paid to my hon. Friend the Member for Staffordshire, South-West (Mr. Cormack) and the hon. Member for Warley, East (Mr. Faulds), with whom I had the honour to serve as an officer of the all-party heritage group, for the work which they have done both in the House and outside to improve radically the climate for legislation of this kind.
  I associate myself also with the tributes paid to the late Arthur Blenkinsop, to Mr. Arthur Jones, the former Member for Daventry, and to Lord Reigate for their roles in the genesis of this legislation.
  I agree with my right hon. Friend that we cannot enter into open-ended commitments. The sums involved under the Bill are neither extravagant nor derisory, but, in company with my hon. Friends the Members for Staffordshire, South-West and for Kidderminster (Mr. Bulmer), I cannot disguise that I should have preferred a much larger initial capital sum under the Bill.
  It is not necessary to reopen old wounds, much as one might like to, about whether the National Land Fund constituted an addition to public expen-
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  diture. Suffice it to say that the Bill still ensures that the fund will be competing on a routine year-to-year basis with other forms of public expenditure and that Ministers and the Treasury can reduce payments into the fund from year to year and direct the fund's investments. I refer here to clause 6(2)(b):
  "The Trustees shall…if the Treasury so require, invest any such amount specified by the Treasury in such manner as the Treasury may direct."
  I am sure that the trustees will not become the Treasury's poodles, but they must guard against becoming its retrievers.
  Our aim in the medium term ought to be to give the fund a substantial capital base and flow of income, so that there should be a possibility, at the discretion of the trustees, to make a major purchase when politicians and the Treasury have other preoccupations. That is the only possible long-term solution to a proper role for the National Heritage Fund as part of a comprehensive heritage policy.
  It is an old saw that no man can be the servant of two masters. Most trustees would acknowledge no master other than their trust deed. However, there will be many ministerial fingers in this particular pie. Is that necessary or beneficial to the Bill's objectives, upon which we all agree? I agree with the hon. Member for Isle of Ely (Mr. Freud) about the power of ministerial veto. I shall not belabour that point but will say a word or two about the multiplicity of fingers in the pie.
  As the noble Lord Reigate adduced in another place, one of the purposes of removing the control of the National Land Fund from the Government and replacing it with suitable safeguards under independent trustees was to eliminate delays in decision making. When a work of art or house comes on the market, it is often essential that a decision is made quickly. A delay might make the process impossible.
  One example of the responsibilities given in the Bill to Ministers and to the Treasury can be found in clause 5(3):
  "The Trustees shall not retain any property (other than money) accepted by them by way of gift except in such cases and for such period as either of the Ministers may allow."
  The distinction between the areas of responsibility may be said to be that the Secretary of State for the Environment

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  deals with property and land and the Minister responsible for the arts deals with objects. However, the properties that are the subject of consideration will frequently consist of land, buildings and objects. Therefore, a single stream of responsibility would seem better. Either of the Ministers, by order and with the consent of the Treasury, can add to the list in schedule 2 any institution that is maintained wholly or mainly by moneys provided by Parliament.
  Two Ministries are again involved, as well as the consent of the Treasury. However, is the Treasury the best judge? Should it be involved? In clause 17, under
  "Objects displayed pending export licence decision",
  we read that the Chancellor of the Duchy of Lancaster may undertake to indemnify against loss. There we are dealing with objects rather than land. It appears that my right hon. Friend is being allowed off on a frolic of his own, free from the restraining hand of the Secretary of State for the Environment. However, if we look carefully, we see that he is not free. In clause 17(2), there is reference to
  "conditions approved by him and the Treasury".
  Should the Treasury really be concerned with storage conditions?
  Clause 16(2) concerns objects loaned from national collections. It provides:
  "Neither Minister shall give an undertaking under this section unless the loan of the object in question is made in accordance with conditions approved by him and the Treasury and the Minister is satisfied that appropriate arrangements have been made for the safety of the object while it is on loan."
  Once more, two Ministers and the Treasury are involved.
  The Government propose to go into the insurance business in a different way from before. They will be acting as insurance brokers, underwriters, inspectors, assessors and loss adjusters. The position of those items is not on all fours with the Government bearing—as they do—their own losses. One should ask whether there will be periodic reports on claims, and whether there will be resort to the commercial insurance market for competitive quotations. That might not seem important now, but if the activities of the National Heritage Fund take the course
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  that we anticipate it might be very important in future.
  I shall not dwell on the role of the Treasury in relation to the National Land Fund, except to say that one lesson of that unhappy affair must be that the House must make its intentions clear beyond peradventure and must ensure that the legislation reflects and gives continuing effect to that intention.
  On the role of trustees, I have referred to clause 6(2)(b) under which trustees may be required to invest at the behest of the Treasury and as it directs. Clause 6(3) provides:
  "Any sums to which subsection (2) above does not apply may be invested in accordance with the Trustee Investments Act…as if they constituted a trust fund and the Trustees were the trustees of that trust fund."
  Aside from that, it seems to be the intention of the Bill that the fund should not exhibit the aspect of a trust and that the trustees should not exhibit the characteristic of trustees in the normal sense of the word. For example, they have to give money to the Treasury when it asks for it. As the course of the fund's activities develops, that provision will be seen to be an inherent weakness in the Bill.
  Since the £50 million to which reference has been made is not to be restored, it should be not only on record in the House but provided in the Bill that in deciding on the amount of each annual payment into the fund Ministers should not have in mind the amount standing to the credit of the fund.
  The trustees must have flexibility to accrue payments for particularly large calls on their resources, either anticipated or unanticipated, and must not be put in the position of buying non pre-eminent things for purely budgetary reasons. We have seen all too many effects of that sort of pressure elsewhere in our national life.
  Under clause 14 Her Majesty may, by Order in Council,
  "provide for the transfer to the Trustees of the National Heritage Fund of any functions exercisable by the Ministers or either of them."
  It would be helpful if the Minister who is to reply could elucidate at greater length the thinking behind that clause. Is there any intention to streamline and rationalise the administration of the fund

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  after a trial period? If not, what is the thought behind clause 14?
  I thought it important to dwell briefly on the question of ministerial responsibility. If functions are widely dispersed, there can, as we all know, be a blurring of responsibilities, with inevitably unsatisfactory results. There can be a waste of resources and of time on the part of Ministers, civil servants and trustees and there could even be, heaven forbid, confusion.
  Most important, blurred responsibilities are a lobbyist's paradise which can lead to the frustration of the intentions of the legislation. I am thinking not only of potential vendors competing for the limited attention of Ministers and trustees but of the potential activities of the great lobbyist—the Treasury. I ask the Government and the House to ponder on that.
  I wish to refer briefly to property accepted in satisfaction of tax. We would not need a National Heritage Fund if taxation had played a more restricted role in our national life and had been applied more rationally to the national heritage. However, in present circumstances the Bill is welcome as far as it goes.
  Clause 9(4), which deals with the disposal of property in lieu of tax, provides:
  "Either of the Ministers may in any case direct that any property accepted in satisfaction of tax shall, instead of being transferred to the Commissioners, be transferred to the Trustees of the National Heritage Fund or to some other person nominated by the Ministers".
  I am delighted that the Chancellor of the Duchy of Lancaster confirmed that his policy will be that pictures in a collection that may form the foundation of a particular room can remain in situ even if the site is not publicly owned.
  That leads ineluctably to considerations of other fiscal matters important to our national heritage which are not included in the Bill. My hon. Friend the Member for Buckingham (Mr. Benyon) discussed the matter in some detail. If that policy is pursued, it will be important that nationally-owned treasures should remain in private property and under private management.
  What further help are we to offer to secure the protection of these national assets? Will running expenses be tax allowable? Will special listed-building
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  allowances be built into the tax system, as Lord Gowrie suggested in another place in November 1978? Will donations to galleries and the National Heritage Fund be legitimate offsets against taxable income? The Bill highlights, while providing only a small solution to, the necessity of further fiscal concessions to private owners of historically interesting properties to maintain those properties for public enjoyment. There can be few better long-term investments for the country.
  The Bill will not in any way solve the problem of preserving and enriching our national heritage. Many beautiful objects will still be taken out of the country. There will still be desecration of the countryside, and many fine houses will undoubtedly still be destroyed. Nevertheless, the Bill is a welcome if limited step in the direction of a comprehensive heritage policy. We congratulate my right hon. Friend on introducing it and look forward to further steps to come.
  9.1 pm
  Mr. Gordon Oakes: The Chancellor of the Duchy of Lancaster, in a felicitous phrase, referred to Matthew Arnold and the sweetness and light that the debate has engendered in the Chamber. The debate may be one of the last occasions this year when we have such a measure of unanimity and agreement. Every hon. Member who has spoken has praised and welcomed the Bill, including my hon. Friend the Member for Warley, East (Mr. Faulds), the hon. Member for Isle of Ely (Mr. Freud), representing the Liberal Party, and even my hon. Friend the Member for York (Mr. Lyon), although the latter somewhat damned it with faint praise.
  I congratulate the Chancellor of the Duchy of Lancaster on bringing to the House a Bill that is obviously dear to his heart and which has enjoyed such a unanimity of welcome. But I say also to the right hon. Gentleman, in his other capacity as Leader of the House, that it is nothing short of astonishing that we should spend a whole day discussing a Bill which is so unanimously agreed by both sides of the House and is therefore the ideal measure, both constitutionally and temperamentally, for the other place to begin when tomorrow the Government will be introducing a highly contentious Bill for debate for the first time in the

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  other place instead of in this House. Presumably the Local Government, Planning and Land Bill is beginning in the other place because this House did not have the time to begin it. It is an astonishing situation.
  Mr. Cormack: Is it not important that occasionally the House of Commons should turn its mind to things that are perhaps of more lasting importance? In my experience, this is the first time that we have debated the national heritage on a Government motion or Government Bill. Surely that alone merits this debate.
  Mr. Oakes: It is delightful that we should be able to discuss the Bill, but not at a time when a major Bill, involving not merely £15 million but many thousands of millions of pounds and of major constitutional significance to the workings of government and the relationship between local government and central Government, is being debated in a House which is a non-democratic Chamber.
  In this Bill we must look at a number of matters. First, there is the position of the trustees and their appointment, and the way in which the fund will be administered. Secondly, we must look at the amounts involved in the fund. Thirdly, there is the question of the expenditure of the fund and the ways in which the trustees will carry out that expenditure.
  Questions also arise in respect of other parts of the Bill, such as acceptance-in-lieu as well as the question of indemnities, which really have little or nothing to do with the National Heritage Fund. One of my hon. Friends said that he believed that the indemnity moneys would come out of the National Heritage Fund. I hope that he is wholly mistaken, because as I read the Bill that would be moneys provided by Parliament into the Consolidated Fund, which has nothing to do with the National Heritage Fund.
  I should first like to look at the question of trustees, about which a number of hon. Members on both sides of the House have been concerned. As the Chancellor of the Duchy of Lancaster will remember, I had the somewhat difficult job of introducing the Public Lending Right Bill. I must admit that I got full
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  and absolute co-operation from the right hon. Gentleman and from the Conservative Front Bench. However, I wonder where those Conservative Members are who used to talk about quangos, who saw quangos behind every piece of legislation, and who regarded quangos as wicked bodies who were doing the Government's job forthem. In effect, what we have done is to set up a quango. The trustees will form a quango. I make that point because administrative quangos can be most economic and useful bodies to set up. Indeed, there is no adequate way in which this fund could be properly administered without trustees, who in themselves really form a sort of quango. I cannot resist saying that, because there was so much attack on the previous Government when they set up bodies exactly like this to do a job independently of the Government.
  However, a number of important questions have arisen in relation to trustees which I hope the Under-Secretary of State for the Environment will answer. We know very little about the trustees except that there shall be a chairman and eight others, and that the eight shall be geographically distributed so that Scotland, Wales and Northern Ireland as well as England are represented. That is about all that we know about the trustees from the rather meagre provisions in the Bill.
  The first question that inevitably arises relates to their appointment and to the Ministers who appoint them. From the tenor of the right hon. Gentleman's speech, it seemed to me that the two lead Ministers—indeed, from what he said, the only Ministers—who will do the physical appointing, other than the chairman of the committee, will be the Secretary of State for the Environment and the right hon. Gentleman as Chancellor of the Duchy. The first question that must be answered—it was raised by my hon. Friend the Member for West Lothian (Mr. Dalyell) and others—is precisely what the role is of other Secretaries of State, particularly the Secretaries of State for Scotland, Wales and Northern Ireland, because the Bill covers Northern Ireland as well. What is their precise role? Will they appoint? Will they be consulted? Are they merely advisory? The House needs to know, especially when trustees of such power are to be appointed.

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  Another matter raised by my hon. Friend the Member for Warley, East, and it is asignificant issue, is that although I and, I am sure, the House are more than happy for the Chancellor of the Duchy of Lancaster, who is also Minister for the Arts, to be one of the appointing Ministers, I wonder whether it is wise in legislation to name the Minister by his office of Chancellor of the Duchy. When we were in office in the last Parliament, the Chancellor of the Duchy of Lancaster was a Minister attached to the Treasury.
  In view of what we have heard from all sides about the iniquities of the Treasury, I do not think that any hon. Member would want a Treasury Minister to be one of the appointing Ministers. That would be absolutely counter-productive and would defeat the whole object of what the Government are trying to do under the Bill, with which broadly the Opposition agree. Therefore, we must consider whether the title "Chancellor of the Duchy of Lancaster" is used. It may ideally suit the appointing Minister in the present instance, but should the right hon. Gentleman go on, as no doubt he will, to higher office within the Government—perhaps Home Secretary: who knows?—another Minister may become Chancellor of the Duchy and he may be a Treasury Minister. Certainly, that is not what the House aims at or wants.
  Mr. St. John-Stevas: I am grateful to the right hon. Gentleman for his kindly reference to myself. However, it is not possible to go on to a higher office than being Leader of this place. Apart from that matter, I was moved to rise by his denunciation of the Treasury. Throughout this matter, the Treasury and the Treasury Ministers have been most helpful and co-operative. Without that help, the Bill would never be before the House. Therefore, I would like to make an unusual tribute to them in response to the right hon. Gentleman's censure.
  Mr. Oakes: I was echoing the censure of the House. The right hon. Gentleman is providing himself with indemnities and insurance way beyond the third part of the Bill in ensuring that he keeps well in with Treasury Ministers and officials. That point will be examined in Committee.
  An important question was raised by my hon. Friend the Member for Caer-
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  philly (Mr. Hudson Davies), namely, that the trustees shall not be too London-based. The hon. Member for Staffordshire, South-West (Mr. Cormack) raised a point about the Ramblers Association and the obvious interest it will have in a Bill of this nature. I ask the Government whether eight trustees as well as the chairman are enough. We do not want a huge body but, in view of some of the comments of my hon. Friend the Member for West Lothian, I wonder whether eight trustees will be able to cover the wide interests that are involved. Suppose that one trustee represented Scotland and one represented Wales. It is hard to say that that would be wise, with all the interests in Scotland and Wales—environment, art, library, scientific and so on.
  The hon. Member for Staffordshire, South-West also raised the point about remuneration. The Bill is silent on that point, but we know that allowances will be given to the chairman and members. Presumably, those allowances will come out of the fund. Therefore, we must be careful not to spend precious resources on expenses. On the other hand, to get people of the calibre that we want, who will have to devote much of their time to the task—in the initial years especially—will be difficult. The office is so high that the appointment will be by the Prime Minister herself. We must look at the question of remuneration, and I hope that the Minister will clear up the matter. Do the Government mean a salary or merely expenses for attending meetings?
  It is important that not all the trustees should be academics. I was encouraged on this point by the Chancellor of the Duchy's opening speech and his reference to "a cultured generalism". That is a lovely phrase. I do not know exactly what it means.
  Mr. David Price: It means us.
  Mr. Oakes: If that is so, some of the environmental interests, scenic interests, the rights of the public and the Ramblers Association might be excluded by that sort of approach. Certainly, many questions remain open about the appointment of trustees.
  We come to the vexed question of the amount of the allocation. We have heard frank speeches about this from several hon. Members. I came into the House in

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  1964. In 1977 I had been a Minister for three years. I had never heard of the National Land Fund until Mentmore. I suspect that most hon. Members were in that unfortunate position. In 1957, the House was advised—no matter which party was in office and whether or not by a Select Committee of the House—that we should rob the dead of their memorial. That is what the House did only 12 years after the war, at a time when we were entering the "never had it so good" era. It is astonishing that the House allowed Treasury Ministers to get away with that. It is water under the bridge. It happened.
  The hon. Member for Buckingham (Mr. Benyon) was not a member of the Committee, and I wonder why he was kind enough to accept the fact that neither we in our White Paper nor the present Government acceded to the Committee's request that £50 million be put back. Hon. Gentlemen exaggerate when they say that this is the implementation of what Dr. Hugh Dalton suggested. We should look at the enormity and bravery of the House in the post-war period when things were extraordinarily difficult. The equivalent of £400 million was put into a fund that was later robbed. As the hon. Member for Isle of Ely said, it was robbed after a period of total neglect. That money was earning just over 1 per cent. for year after year, and none of it was spent, which was probably largely because the then Members of the House knew so little about it.
  Had we been in Government and implementing our White Paper, there would have been severe criticism from the hon. Member for Buckingham and other members of the Committee to the effect that we did not go the whole hog and, as recommended by the Committee, put £50 million back into the National Heritage Fund.
  My hon. Friends have asked a number of important questions about the £5·5 million a year. First, will that sum vary in accordance with the number of bequests from private individuals to the fund? I hope that the Minister will tell us that that sum will be put in yearly regardless of private bequests. It will be highly counter-productive if the Government decide not to put money in because, in a particular year, there have been large numbers of contributions from private
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  individuals. We need clarification that the fund will not vary according to individual contributions and a commitment from the Government that at least £5·5 million will be put into the National Heritage Fund annually.
  Secondly, is this new money or is the £5·5 million being taken from other parts of the arts budget? I hope that it is new money provided by the Government and not an attempt to rob Peter to pay Paul. We need a clear and unequivocal statement. It would be monstrously wrong, under the guise of setting up the funds, to rob theatres, the opera, art galleries, and so forth, and that could happen unless we have a clear assurance from the Minister.
  Clause 5 covers payments by individuals. I was glad to hear that in the Finance Bill such gifts will be relieved from capital transfer tax, but will they be wholly relieved? What publicity will be given to that relief? I accept that it may not be possible to put such provisions in this Bill and that they should go in the Finance Bill. However, it should be made known that a bequest to the National Heritage Fund will be tax-exempt. My hon. Friend the Member for West Lothian asked a valid question on the position of other funds, particularly the National Trust and the Scottish National Trust.
  Will there be a competitive element set up that might well rob those funds of money by reason of people bequeathing to the National Heritage Fund? Will it make any difference? Perhaps the Minister will tell us what discussions he has had with other charitable organisations on the effect of bequests to this fund. If he has not had any discussions, will he tell us what discussions he will have? This could make very serious inroads on the revenue from bequests in the case of bodies such as the National Trust and the Scottish National Trust.
  Mr. Dalyell: The related question is whether bequests can be earmarked via the National Heritage Fund for the Scottish National Trust, the National Trust, the Royal Society for the Protection of Birds, or whatever it might be.
  Mr. Oakes: Indeed. What will the mechanism be? My hon. Friend has raised a perfectly valid point.

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  With regard to the expenditure from the fund, we are talking about £15.5 million initially. I thought I heard the Chancellor of the Duchy of Lancaster mention at some point the figure of £12 million and not £15.5 million. Perhaps there is an explanation of that difference. I had thought that at least in the first year the full capital transfer of the existing Land Fund would go in to to to the new National Heritage Fund. Even then, the fund would be deprived of the first year's income of £5·5 million, and it is not a good enterprise that has to live on its capital in this way. We need to know from the Government how these trustees, with so many commitments in so many varied areas, are to spend the money. Will they have enough money to cover so many different areas?
  The question of our industrial heritage and our agricultural heritage was raised by the Father of the House, my hon. Friend the Member for Dagenham (Mr. Parker), and by the hon. Member for Newark (Mr. Alexander). I urge the Government to remember that we have a unique example of an agricultural system. It is unique within Europe, not just in this country. When advice comes from the Father of the House, the Government ought to heed it, because my hon. Friend is a respected figure in this House—almost a non-party figure. It would do the Government no harm to think again before they dispose of these priceless assets.
  Archaeological sites and archaeology are not mentioned in the Bill. The Minister may say that there is no need to mention the subject. I know that the word "historical" is used in the Bill, and probably I shall be told that it includes "archaeological". There will be a very definite role for the fund in dealing with instances of rescue archaeology. There are instances in which priceless parts of our national heritage can be lost unless immediate emergency action is taken. Sometimes this can be done merely by compensating the builder concerned for the time involved in the rescue operation. It would be well worth spending that money in order to acquire a better knowledge of Roman sites and of medieval sites. Often these are in the centres of towns.
  One of our greatest treasures in this country, Hadrian's Wall, is very little
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  protected, especially when we think of the protection given to national monuments in other countries. Hadrian's Wall might well be regarded as an international monument. If there were to be some major expenditure needed because of land sales, or whatever it might be, in that area alone, the fund would not go very far. We should be in a similar position if a major house with its contents came up for sale. The whole fund could be swallowed up in one such transaction. It would no doubt be a most worthwhile transaction, but what of all the other transactions that the trustees will have to face? We should not forget our industrial heritage and the great interest today in industrial archaeology. I suppose that the word "scientific" would cover that.
  It is important to remember that not all the treasures of our heritage are paintings or books. Our heritage also consists of marvellous engineering feats—civil and transport engineering and so on—and they should be preserved for future generations. I hope that such things will also be included in these provisions.
  I realise the enormous task and the puny resources that the trustees will have. The hon. Member for Isle of Ely said that this was a mean sum—only 0·2 per cent. of the money we get from tourism. The question is vividly before the House whether the Bill is far-reaching enough and whether the trustees will have enough money and enough powers.
  My hon. Friend the Member for Warley, East did not like the statement in the Labour Government's White Paper of February this year about acceptance in lieu. I agree with my hon. Friend the Member for York. I was a Minister at the time. I was not responsible for the issue of the White Paper, but I fully accept vicarious responsibility for it.
  One statement in the White Paper does not seem to have got over to the Government:
  "While the acceptance in lieu procedure has in the past played a useful role in helping to preserve the national heritage, the system has a number of disadvantages. The procedures for accepting property in lieu are complex, liable to misunderstanding and sometimes time consuming. The system is inflexible because it can only be used on those occasions where the individual owner has a tax bill which equals or exceeds the value of the property he wishes to sell. In the Government's view an attempt to fit the acceptance in lieu

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  procedures into the new National Heritage Fund would increase the extent to which they duplicate private treaty sale arrangements and would not cure the existing defects."
  That paragraph of the White Paper, I believe, is as true now, under this procedure, as it was then.
  I should like to hear whether that is so or whether the Government have overcome these difficult and complex problems merely by transferring this responsibility from the Treasury to the Ministers concerned. I fear that there will still be great difficulty with the in-lieu procedure. The Treasury itself issued a press notice on 23 February in which it tried to clear up some of the misunderstanding and pointed out that an extended system of private treaty sales could be operated with advantage to both the vendor and the acquiring institution. That should perhaps be looked at again.
  The indemnity provisions are suspiciously like proposals for a Bill which were brought out each autumn in my three years at the Department of Education and Science only to be put away to gather dust again because legislative time could not be found. As the Minister rightly said, they give statutory backing to what is already being done.
  Would it not be wise to take the opportunity to extend this indemnity procedure, as my hon. Friend the Member for Warley, East suggested, to private loans rather than restrict it only to the institutions which are actually named in the Bill? It is as tight as that. Secondly, is it not equally important to make provision now for international funds and exhibitions, to allow some of our treasures sometimes to go abroad, just as we have had the enormous benefit of seeing other people's cultures through such events as the Tutankamun exhibition or the South American exhibition? The Bill will cater for that, and I was heartened by the tenor of the remarks of the Chancellor of the Duchy of Lancaster in opening the debate. He implied that he was quite prepared to be flexible over the indemnity provision.
  The financial provisions of the Bill state:
  "Contingent liabilities arising from undertakings to indemnify institutions and persons…cannot be predicted."
  I think that my hon. Friend is probably right. Those liabilities have been nil
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  as far as indemnity arrangements are concerned. If that is so, surely it would be possible to widen the scope to cover statutory power for private loans to institutions and for international loans.
  As an ex-Education Minister, I know that our universities—to quote the Chancellor of the Duchy of Lancaster—are the jewel in our educational crown. Even so, I would like to see the provisions widened to include polytechnics and other institutions of higher education. I hope it will be possible to do that.
  This is a useful Bill and we accept it. It implements much of what was contained in our own White Paper produced in February this year. The Bill does little, but the Government have every right to say that the previous Labour Government also proposed very little. The Bill can certainly be improved in Committee. As many hon. Members have said, the Bill is at least a start in the right direction towards preserving the manifold aspects of our heritage for the people of this country.
  9.31 pm
  The Under-Secretary of State for the Environment (Mr. Hector Monro): I am grateful to the right hon. Member for Widnes (Mr. Oakes) for his remarks. I shall try to respond to the points he has made. He is right in his reference to indemnities. We wish to be flexible. That is what the debate is about. My right hon. Friend and I have listened to points made today. If there is something we can do in Committee about them, that will be the time to do it, particularly in relation to the museums which are not included in schedule 2 and which many people consider might be included. We must look at that.
  The debate has been interesting. At times I thought that we were going through the Committee stage at a rate of knots. It is a privilege to be associated with the welcome given by the Government to the concern of hon. Members in all parts of the House that the future of our national heritage should be assured for the benefit of future generations, so far as it is possible to assure it with human institutions and available resources.
  It is particularly pleasing, and a demonstration, at a time of financial stringency, of the Government's desire to conserve our heritage, that we have been able to

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  respond so closely to the recommendation of the Environment Sub-Committee of the Expenditure Committee. My hon. Friend the Member for Buckingham (Mr. Benyon) was a member of that Sub-Committee and I was glad of his intervention in the debate.
  We are determined to respond to the interest shown in conserving our environment and my right hon. Friend the Secretary of State has maintained, as an indication of his enthusiasm, the full grant to the Historic Buildings Councils, which cater for many of the matters we have been discussing today. I am grateful to hon. Members on both sides of the House for their contributions which have been favourable to the Bill. The hon. Member for Warley, East (Mr. Faulds) was, I felt, a bit ungracious. It was untypical of him. Perhaps he was a little jealous that he was not presenting the Bill. I know of his great interest in the issues as a result of the White Paper published by the Labour Government.
  Hon. Members have shown themselves well acquainted with the Government's intentions and are sensible of the difficulties that the preservation of our heritage entails. I hope that this temperate attitude will continue since I anticipate being in charge of the Committee stage of the Bill.
  I stress that we regard the National Heritage Fund first and foremost as an effective safety net which is intended to look after historic houses, the countryside, land which is of scientific interest, and pictures and art objects which may otherwise be lost to the nation. The Government have no intention of going into the business of running country houses or setting up shop as a picture gallery. The fund provides a refuge of last resort.
  I stress the theme which runs through the proposals. We are essentially dedicated to the establishment of trustees with unfettered discretion to make decisions for the preservation of the heritage. We do not wish to tie the trustees' hands any more than is necessary to ensure parliamentary control over expenditure. We intend to trust the trustees.
  The Secretaries of State for Wales, Scotland and Northern Ireland will each appoint a trustee with the agreement of my right hon. Friends the Secretary of
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  State for the Environment and the Chancellor of the Duchy of Lancaster. There may be more than one trustee from each of Scotland, Wales and Northern Ireland, because we are interested in talent, experience and breadth of interest. We want people who understand not only country houses and art but gardens and the landscape. We are sure that we shall be able to achieve a broad balance and that the trustees will be acceptable to everybody.
  I shall try to answer as many questions as I can early in my speech. The hon. Member for Warley, East asked a number of questions. The heritage interest is articulate. We held meetings, some of which were confidential. Officials met under the auspices of the Standing Commission on Museums and Galleries. The hon. Gentleman also asked about local university museum representatives. In October they were invited to attend a meeting on the Bill. They were offered a number of dates and chose 4 December as the date which suited them. As a result of their wish, the meeting is to take place tomorrow. It was not our wish to put them off.
  The hon. Gentleman also asked about whether trustees will be able to spend capital only in the first year. That is not correct because the grant will be paid in the first month after the fund is established. That can be invested and the interest used. It will involve a substantial sum. The right hon. Member for Widnes asked about the sums of £12 million and £3½ million. Broadly speaking, £15½ million will be transferred to the National Heritage Fund. We do not know the exact sum, but about £3½ million will be for the in-lieu provision. The sums involved are flexible depending upon what is in the pipeline on 1 April, if that is the day on which the fund is set up.
  I was also asked about offers of objects of art in lieu of tax. The Government are firmly committed to reimbursement to the Inland Revenue. We should probably have to refuse such a gift—but reluctantly.
  I was asked whether we could specify the National Art-Collections Fund and the Friends of the National Libraries as eligible recipients of property accepted in lieu. That will be possible. Clause 9(1)

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  contains the main provision for the disposal of property which is accepted instead of tax. The terms are wide. I assure the hon. Gentleman that that covers his point.
  There is no discrepancy between clauses 4(3) and 9(4). The trustees will hold property only in unusual circumstances, and with the consent of the Minister where the property is paid for by the trustees or accepted in lieu of tax. The waiving of interest charges on the capital transfer tax debt when the property has been offered in lieu is under consideration by my right hon. and learned Friend the Chancellor of the Exchequer. In the unlucky event that the Chancellor of the Duchy of Lancaster no longer has responsibility for the arts—other than an edict from Rome, I cannot see that happening—there would be a transfer of functions order, and all would continue as normal.
  My hon. Friend the Member for Staffordshire, South-West (Mr. Cormack), who has taken immense interest in the Bill and has taken a personal interest in our heritage over many years, asked a number of questions. I have answered the point about trustees. We want the best talent available, and the trustees will be appointed in good time so that they can take up their appointments before 1 April, if that is to be the date on which the trust comes into operation.
  My hon. Friend asked about the difference between "enabling" and "assisting". There is no difference. There will be up to 100 per cent. help from the trustees, whether to enable or to assist. That point was also raised by the hon. Member for West Lothian (Mr. Dalyell).
  My hon. Friend the Member for Staffordshire, South-West asked about gardens and land as part of our heritage, as did the hon. Member for Isle of Ely (Mr. Freud). It is very much a part of our heritage, and certainly assistance to gardens or landscape will be covered by the fund, as will be buildings and objects.
  Mr. Freud: My reason for raising that point was that the Bill seemed to make no provision for recreational or park land. It contains much about
  "scenic, historic, aesthetic, architectural scientific interest".
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  There is not a word about recreational or park land.
  Mr. Monro: I assure the hon. Gentleman that that is not the intention. If that point is not clear, it is a matter which we must put right in Committee. Recreational and park land certainly should be included within the Bill.
  My hon. Friend raised the question of objects, and particularly Iron bridge. We are considering three points—land, buildings and objects—and everything falls into one of those categories. I can assure my hon. Friend that Iron bridge, being a building, is quite safe. Everything about which he is concerned will be included in the Bill. The trustees will consult the Royal Society for the Protection of Birds, if necessary. The provision of amenities is covered by the Bill, and a bird sanctuary is an amenity which we would encourage.
  We have taken on board the crucial point that local pre-eminence is important, as is national pre-eminence, and we must not overlook that in safeguarding our heritage.
  I mentioned earlier that we had asked for views about indemnity. We have received some views today, which we shall consider in Committee.
  May I answer the point about VAT raised by my hon. Friend and other hon. Members? We cannot exempt from VAT the trust or any body connected with historic buildings. The Department of the Environment pays VAT, and all bodies must be alike.
  My hon. Friend asked whether the trustees should be paid. Certainly at this stage—and I see no reason why we should change our view—the answer is "No".
  Mr. Dalyell: We note the welcome presence of the Minister of State, Treasury. Surely it is simply not true, as those of us who are Finance Bill addicts know, that everybody is treated alike under VAT. There are exemptions. Is not this a case for an exemption?
  Mr. Monro: As the hon. Gentleman says, there are exemptions, but in the position that I have mentioned everyone is a like.
  My hon. Friend the Member the Staffordshire, South-Westr asked about

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  reimbursement. The cost is borne fifty-fifty by Votes of my two right hon. Friends the Secretary of State for the Environment and the Chancellor of the Duchy of Lancaster—if my hon. Friend likes to have it correctly, the Office of Arts and Libraries. No problem is envisaged.
  My hon. Friend the Member for Kidderminster (Mr. Bulmer) raised several important points. He asked whether civil servants would be eligible to staff the secretariat and what would happen to their pension rights. If they are employed by the secretariat, they will have to be seconded, and in those circumstances their pension rights will be preserved.
  My hon. Friend also raised a point that many other hon Members consider to be important—the original intention of the National Land Fund to represent a war memorial to those who lost their lives in the war. His idea that some of the money from the trust might be used by the trustees for at least one example to be treated as a memorial is one that I think all hon. Members will approve. We should leave that thought to the trustees, who will no doubt read the reports of this debate and realise that hon. Members on both sides of the House felt it to be an idea that should be pursued. It is for them to see whether it can be worked out in practice.
  I note and appreciate the great work of the hon. Member for Dagenham (Mr. Parker) with the Historic Buildings Council. He rightly mentioned our debt to Mr. Arthur Jones and the late Mr. Arthur Blenkinsop. It is sad that Mr. Blenkinsop, who died in my constituency, did not live to see the Bill come to the House.
  When we are thinking about those who are no longer here, it is also right to mention Miss Betty Harvie Anderson. Baroness Skrimshire, as she became, did a great deal for the Conservative Party arts group, but is also, sadly, no longer with us.
  The hon. Member for Dagenham raised the question of Laxton. That is the type of property that could and should be considered by the trustees. There is to be no indication that they should not buy land for the trust, provided they can pass it on as quickly as possible.
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  The hon. Member for Isle of Ely asked about an investment fund run by the trustees. If public money is involved, they must have approval and advice from the Government, but if they want to invest their own income they can do it in their own way, subject only to the provisions of the Trustee Investments Act.
  My hon. Friend the Member for Newark (Mr. Alexander) spoke in detail about Laxton. I have given him his answer. It is one that we can consider in the future.
  The hon. Member for Caerphilly (Mr. Hudson Davies) mentioned the question of trustees. There will be a trustee from Wales. The hon. Gentleman highlighted the regional significance of the fund and said how important it is for us to do all that we can to retain as many objects and works of art in situ as possible so that historic houses may be furnished with the original furniture and pictures that have hung in them for many years.
  The hon. Member for West Lothian asked many questions, all of which I accept are important. I have already answered some of them. I have already explained to him that land is eligible and answered his query about Laxton. I accept what he said about the importance of the National Trust for Scotland and the fact that we should have a trustee from Scotland who will consult the Secretary of State in detail.
  I have covered the points raised about gardens. Gifts, of course, would be free from capital gains tax and capital transfer tax.
  On maintenance, houses are entitled to support from the Historic Buildings Council if they fall into the appropriate category, but day-to-day maintenance would not normally come within the orbit of the National Heritage Fund.
  As regards limited visiting, we must treat each case on its merits. We must look very carefully at the geographical position of the property and consider the number of visitors likely to attend. But we want to help the owners of historic houses and enable them to live in their houses so that they can be seen to be houses that are lived in with, as I say, original furniture and pictures.
  Archives certainly would be entitled to assistance under clause 3(6)(a) and, if

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  necessary, could be added at any time to schedule 2 by statutory instrument.
  I note what the hon. Member for West Lothian said about Hopetoun House. That is certainly important.
  The existing exemption from stamp duty will continue, and any new provisions in this Bill are under consideration by the Treasury. I have already said that there will be certain exemptions from CGT and CTT, and they will be implemented in the next Financial Bill.
  Mr. Dalyell: Is the Minister of State, Treasury, who is with us tonight, volunteering for service on the Committee which will consider the Bill? If so, his presence will be most welcome.
  Mr. Monro: I am sure that my hon. and learned Friend will not volunteer, though I wish he would.
  The hon. Member for West Lothian asked about the Scottish Countryside Commission. Ot the moment, that body would not have powers under the Bill to hold land, because, of itself, it has powers from the trustees. However, the trustees could certainly help a body such as Scottish Youth Hostels Association to acquire property.
  The hon. Member for Middleton and Prestwich (Mr. Callaghan) asked why the Government had refused to allow the Tondo to be lent to the Hermitage museum. The Tondo is unique and should not be subjected to unnecessary risk. No compensation in the world would cover the loss, or damage in transit, of this object. I have explained to the hon. Member the split of the £15·5 million.
  I say to my hon. Friend the Member for Northwich (Mr. Goodlad), who made a thoughtful speech, that we do not think that there are too many fingers in the pie. Clause 14 will be considered in Committee, and, over the years, if we can simplify the procedure, we shall do so. It may be that experience will show that the in-lieu system should at some time be changed. Clause 14 gives us an opportunity to change it.
  As the House is now well aware, we are firmly committed to preserving the heritage. The fund is central to our strategy—
  Mr. W. Benyon: Could my hon. Friend answer the question which a number of us asked about whether the funds could be used for endowment in respect of property taken over?
  Mr. Monro: Yes, they can. I am sorry that I overlooked that. However, I should remind hon. Members that if one sets up too many endowment funds, which often have to he pretty substantial, the National Heritage Fund may disappear rather more rapidly than we would wish.
  When in Opposition, we made clear our ideas on the arts and the heritage through publication of the booklet "The Arts—The Way Forward", produced under the chairmanship of my right hon. Friend the Chancellor of the Duchy of Lancaster. Since taking office, we have set up a separate Ministry to reflect the importance that we attach to the arts and give them a voice in the Cabinet. Moreover, the interest and concern of my own Department, on the historic buildings side, is no less. Despite financial stringency, we are maintaining our expenditure on this part of the heritage.
  Nevertheless, it is perhaps true that we do not always realise how important our heritage is until we have lost it—until a stately home is demolished or in ruin, its contents dispersed and sold abroad, its gardens overgrown and desolate, and the unique atmosphere of historical presence gone for ever.
  Mr. Freud: Will the hon. Gentleman recognise that it is money we need, not voices? We have had voices on the arts for a long time, but no amount of voice seems to save anything. Theatres and orchestras are closing in spite of voices.
  Mr. Monro: Of course, money is important in the whole issue here. That is what we are debating, and at least we have done something about it. We are here setting up a fund which will do just what the hon. Gentleman wishes and what the whole house wishes to be done to preserve the heritage. My right hon. Friend has set a fine example to the nation in the determination to maintain the heritage in every possible way, and I have highlighted that we are equally as interested in the landscape and countryside as in the historic buildings and their contents. Many people perhaps consider the latter to be the

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  primary concern of the Bill. That is not so. Our concern is for the whole heritage, and that is why I said that the trustees would reflect countryside interests, interests in gardens, parks and so on just as much as interest in the buildings and their contents which we consider so important.
  In the Government's view, the National Heritage Fund will play a decisive role in relieving us of the fear of a recurrence of such disasters as have occurred in the past. I am sure that the House will wish to afford the Bill speedy progress to the statute book so that the fund's contribution to preserving the heritage can begin just as soon as possible.
  I believe that some hon. Members have tended to think that the money we are talking about here, the £15½ million, is all that is available. Of course, resources are extremely tight, but we have made clear also that should a major object come up, whether it be a historic house and contents or some quite exceptional work of art, the Government will themselves look at the whole issue and consider whether special treatment should be given to that important matter.
  I am confident that the Bill will receive a Second Reading and that, after the work in Committee, we shall be able to provide for the House a measure which will be acceptable to all in the interests of our national heritage.
  Mr. Dalyell: I acknowledge the Minister's genuine attempt to answer the debate, for which he should be given credit, but will he or the Chancellor of the Duchy tell us whether there will be a Treasury Minister on the Standing Committee? This is more than just a light-hearted point. Many aspects of the Bill can be properly dealt with in detail in Committee only with the authority of a Minister from the Treasury present. Do the Government intend to have a Treasury Minis-
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  ter on the Committee which considers the Bill?
  Mr. Monro: We shall give the matter thought. I have no time to go into more detail now.
  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).

  BUSINESS OF THE HOUSE
  Ordered,
  That, at this day's sitting, the Motion relating to References in Court to Official Report of Debates and Reports of Committees may be proceeded with, though opposed, until half-past Eleven o'clock or for one and a half hours after it has been entered upon, whichever is the later.—[Lord James Douglas-Hamilton.]

  NATIONAL HERITAGE [MONEY]
  Queen's Recommendation having been signified—
  Resolved,
  That, for the purposes of any Act of the present Session to establish a National Heritage Fund for providing financial assistance for the acquisition, maintenance and preservation of land, buildings and objects of outstanding historic and other interest, to make new provision in relation to the arrangements for accepting property in satisfaction of capital transfer tax and estate duty and to provide for payments out of public funds in respect of the loss of or damage to objects loaned to or displayed in local museums and other institutions, it is expedient to authorise—

  (a) the payment out of moneys provided by Parliament of any sums required by any Minister for making payments under that Act; and

  (b) the payment of any sums into the Consolidated Fund.—[Lord James Douglas-Hamilton.]

  COURT PROCEEDINGS (PARLIAMENTARY PAPERS)
  Mr. Speaker: I have selected the amendment in the name of the hon. Member for Lewisham, West (Mr. Price).
  Mr. Michael English: On a point of order, Mr. Speaker. I am grateful for your remarks, but the amendment refers to the doubtfully defined question of what is a proceeding in Parliament.
  The matter was considered by a Joint Committee of both Houses, which included several Law Lords and a number of Queen's counsel from both sides of this House. The report of that Committee ought to be available to hon. Members for our debate.
  I made sure that both my secretary and I asked the Vote Office this morning and this afternoon for the report. The Vote Office conveyed the request to Her Majesty's Stationery Office before its penultimate run of papers to the House, but the report was not included on that run or on the last run. I discovered to my amazement that the last run of papers to the House from HMSO is at 4.15 pm, whereas we are about to begin a debate on the subject at 10 pm.
  It will not be much good if hon. Members are not able to refer to papers that are relevant to the debate. The business was set down on Thursday for debate and appeared on the Order Paper on Friday morning, which did not give a great deal of time for hon. Members to get the relevant information. Hon. Members should have that relevant information. It is not directly referred to in the report that we are debating, but my hon. Friend the Member for Lewisham, West (Mr. Price) is clearly moving his amendment because he realises that the report is, in some respects, incomplete.
  May I ask you, Mr. Speaker, therefore, whether we could defer the debate until arrangements can be made for all relevant reports to be before the House?
  The Chancellor of the Duchy of Lancaster and Leader of the House of Commons (Mr. Norman St. John-Stevas): On a point of order, Mr. Speaker. It may assist the House if I say that I shall be happy to accept the amendment of
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  the hon. Member for Lewisham, West (Mr. Price).
  Mr. Christopher Price: Further to that point of order, Mr. Speaker. Is it possible for the right hon. Gentleman to accept an unmoved amendment? I have not moved anything yet, and I understood that the Chancellor of the Duchy of Lancaster would be opening the debate.
  Mr. Speaker: There can hardly be an amendment. We have not yet had the motion.
  10.3 pm
  The Chancellor of the Duchy of Lancaster and Leader of the House of Commons (Mr. Norman St. John-Stevas): I beg to move,
  That this House gives leave for reference to be made in future Court proceedings to the Official Report of Debates and to the published Reports and evidence of Committees in any case in which, under the practice of the House, it is required that a petition for leave should be presented; and that the practice of presenting petitions for leave to refer to parliamentary papers be discontinued.
  I hope that it will be for the convenience of the House if I briefly summarise the purpose and background of the motion. If the motion is approved, it will no longer be necessary, as hitherto, for petition to be made to the House for leave to make reference to Hansard or to publish reports and evidence of Committees in court proceedings.
  The proposal essentially derives from a recommendation in the first report from the Committee of Privileges in Session 1978–79.
  Mr. Robin Maxwell-Hyslop: I hope that my right hon. Friend will forgive me for intervening, but his speech may be read outside the House and he has referred to evidence before Committees. He would have done better to refer to published evidence, because the motion does not extend to unpublished evidence given before Committees.
  Mr. St. John-Stevas: I am most grate-for that helpful correction.
  In one detailed respect, to which I shall refer in a moment, the motion goes slightly wider than the recommendation in the Committee's report. That is why my motion does not simply invite the House to agree with the Committee's report.

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  The background to the report from the Privileges Committee was a case in the Central Criminal Court last year when reference was made to Hansard without the leave of the House having been obtained. That gave rise to a reference to the Select Committee on Privileges, which concluded that neither the judge nor counsel for the Crown in the case concerned had made use of the Official Report in a manner which could affect the privileges of the House. The Committee went on, however, to question the general utility of the present practice of petitioning for leave to quote Hansard in court and to consider whether, as the Clerk of the House had suggested in evidence, it might not perhaps have become a meaningless formality and of little practical value in maintaining necessary parliamentary privilege.
  The inquiries made by the Committee revealed some substantial gaps and uncertainties in the history of how the present procedure had grown up and what precise purpose it was designed to serve. The original 1818 resolution, from which the present practice stems, appears to have been primarily concerned with the requirement for the leave of the House to be granted for the attendance of its servants to give evidence in respect of House proceedings. This safeguard of the privileges of the House is clearly still necessary, but the need for the subsequent extension whereby petitioning has been required even in the case of a straightforward reference in court to the Official Report seems always to have been far less obvious. This has been particularly so since the decision of the House in 1971 not to entertain, except in certain very limited circumstances, any complaint of contempt or breach of privilege in respect of the publication of any debate or proceedings of the House or of its Committees.
  The change now proposed is, therefore, a limited one. It in no way affects the House's right of free speech. Nor does it alter the legal position with regard to the restrictions on the use of references to the Official Report or reports and evidence of Committees which can be put in the courts. I am sure that the House will agree with the view, expressed by the Clerk in his evidence to the Privileges Committee, that the House has every right
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  to insist that in this respect the Bill of Rights is meticulously observed. The relevant article—article 9–of the Bill of Rights states that
  "freedom of speech and debate or proceedings in Parliament ought not to be impeached or questioned in any court or place outside Parliament"
  and that the counts have a duty to ensure that there is not a shadow of an erosion of the rights and privileges of the House on this score.
  Mr. English: This is the nub of the matter. Several Committees of this House—some of them Joint Committees—have suggested that this matter has never been defined and needs definition. Would it not be better, therefore, to define it first? Alternatively, if the right hon. Gentleman, on the advice given to him, wishes to advise the House, what does he think the Bill of Rights means?
  Mr. St. John-Stevas: I think that I am quite the wrong person to define the meaning of the Bill of Rights. The people to give a definition of the Bill of Rights have long since passed from us, and the only people who can authoritatively interpret it are the courts. I do not think that anyone else can give an authoritative interpretation.
  All I am concerned to say is that it is essential that the Bill of Rights is meticulously observed, and, should the hon. Member for Lewisham, West (Mr. Price) be so minded as to move his amendment, I should have no difficulty in accepting it. With these continuing safeguards, I do not think that the privileges of this House or Parliament's relations with the courts can in any way be jeopardised by this proposal.
  As I have said, the motion differs slightly from the original recommendation made by the Privileges Committee. That recommendation proposed the discontinuance of the present petitioning proceedure only in respect of references to the Official Report. There appears to me to be no good reason, however, why the need for petitions should continue in respect of references to reports and evidence of Committees if the need for petitions in the case of references to Hansard is to be brought to an end. The motion makes provision accordingly and extends the discontinuance of the present petitioning

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  procedure to cover references to published reports and evidence of the Committees of this House.
  I therefore commend the motion to the House. It will clarify a matter that has remained uncertain for some time, particularly since the 1971 resolution on the publication of proceedings. It will, I believe, get rid of some cumbersome and unnecessary formalities. I am confident that it will do so without detracting in any way from the necessary privileges of this House. As we saw from an incident that happened here last month, this provision still applies in the House and it can cause controversy. The hon. Member for Lewisham, West pressed me to take action on this matter, and I hope that he will be satisfied with the speediness of my response.
  10.11 pm
  Mr Christopher Price: I beg to move, in line 1 of the Question, after "House", to insert
  "while re-affirming the status of proceedings in Parliament confirmed by Article 9 of the Bill of Rights,".
  I agree with and commend the Leader of the House inasmuch as I pressed him to bring this matter—and, indeed, another matter to which I intend to refer later—before the House. In the sense that he has offered me half a loaf, I supose that might be described as better than no bread. However, the further one goes into this matter, the more one finds that it is of rather deeper constitutional significance—
  Mr. English: Hear, hear.
  Mr. Price: —than some have led us to believe.
  The phrase "meaningless formality" that was given to this procedure by our former Clerk is not a fair description of the procedure that we use. It is a procedure which in 1818 the House felt was very important indeed. Indeed, as recently as 1975 Mr. Speaker Selwyn Lloyd said that
  "The custom of the House at present is that the House allows its records to be referred to in a court of law or to be proved by one of its Officers only with leave of the House. This is an attempt to preserve the privilege of the House.—[Official Report, 18 July 1975; Vol. 895, c. 1931.]
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  I do not think that Mr. Speaker Selwyn Lloyd was there talking about a meaningless formality. He quite clearly recognised that there was some point to this procedure, and I do not think that we should lightly throw it away; or, if we are to change our procedure, I think that we should do so in a way that ensures that we know what we are doing so that there is no complaint later.
  I should like briefly to outline how we got to the present position. Throughout the last two years, I and some of my hon. Friends who are not present tonight were responsible for two references to the Committee of Privileges. The first was when we named a certain colonel—Colonel Johnstone—and a debate took place as a result of which the events of the day in question were referred to the Privileges Committee. The naming of that colonel was connected with a contempt action, which in itself was connected with a criminal proceeding under the Official Secrets Act, which later became known as the ABC trial.
  Throughout the months of September and October 1978, while the trial was going on and while the House was not sitting, I attended most of the proceedings of that trial. It is worth saying, as I explained to the Privileges Committee, that I considered it an affront that section 1 of the Official Secrets Act was being applied to journalists in a way that I felt was utterly oppressive to freedom of speech in Britain.
  At that trial, I also discovered that, when it suited the barristers and the judge, Mr. Justice Mars-Jones, they felt quite free to quote Hansard right, left and centre. That was in a criminal case, without so much as a by-your-leave and without coming to the House. It struck me that not only was the Official Secrets Act being applied in a capricious manner but that our rule about reference to Hansard being quoted in the courts was being applied in a similar way.
  Again, because I felt it necessary to draw attention to the way in which the case was being conducted, I used the new method of raising privilege in the House. I believe that I was the first person to do so. In that way it is not done openly but I had to prove before Mr. Speaker that a prima facie breach of privilege had taken place. In some trepidation, Mr. Speaker allowed that while the case

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  was going on, fearing that the sub judice rule might be broken. The matter went to the Committee of Privileges.
  No doubt the right hon. and learned Member for Hertfordshire, East (Sir D. Walker-Smith) will contradict me, but I felt that this matter was dealt with far more rapidly than the other matter which was before the Committee. A two-paragraph report was produced, based on a much longer and fuller report by a Clerk of the House. In his report, the Clerk admitted that he had been in the wrong but felt that it had done the House no harm and that, in order to get rid of such things in the future, we should not bother about them.
  Sir Derek Walker-Smith: As the hon. Gentleman has referred to me, in fairness he must admit that that is a partial exposé of the proceedings of the Committee. We had before us the lengthy and learned memorandum by the then Clerk. We appreciated the importance of the matter but came to a clear conclusion which, with respect to the hon. Gentleman, was the conclusion to which one could not fail to come on a study of that memorandum and the precedents therein cited.
  Mr. English: I cannot find any reference in the report to the five, six, seven, eight or nine reports in which the matter is referred to. It may be mentioned, but I do not see it in the Clerk's memorandum or the Committee's report. If they did not consider those, it is possible that something was missed out.
  Mr. Price: I do not wish to go into that matter. I feel that it would be far better gone into by my right hon. Friend the Member for Ebbw Vale(Mr. Foot) and the right hon. and learned Member for Hertfordshire, East. They are the sole survivors of the Committee of Privileges of the previous Parliament who have attended the debate. I know that the Leader of the House was translated to the Committee of Privileges at a somewhat later stage. No doubt, those hon. Members can comment on the remarks of my hon. Friend the Member for Nottingham, West (Mr. English).
  What I say is that the first report took rather less time than the second report. It is fair enough to put it that way. The Committee reached the conclusion that,
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  although my complaint was justified in its actuality and a "proper" case—a slightly patronising phrase—for the Committee's consideration, more because it gave rise to the opportunity to examine the rules and practice of the House, neither the judge nor counsel for the Crown had made use of the matter in a manner which could affect our privileges. That may be so; that was the judgment that the Committee made. Nevertheless, it was not the feeling that I had sitting in the court when the various statements of various Home Secretaries were being used. The lawyers will probably say that they were not used to interpret a statute, but they were certainly used in a way in which I felt they should not be used in a case of that sort. I have never said that the judges should not have absolute independence and freedom to say what they want, but I also feel that we should have absolute freedom to say what we want. The less that we tangle in that way, the better. We should keep our privileges absolutely separate.
  I felt that Hansard was used in an inappropriate way to try to decide the case. The criminal case fizzled out with conditional discharges for the two journalists, and the House of Lords found that the contempt case had not been proved and quashed the whole thing. That case was the original basis of the reference to the Committee of Privileges and became the basis for its second report after I had given evidence.
  The report of the Committee of Privileges says that the provisions of article 9 of the Bill of Rights, reinforced by the care taken by courts and tribunals to exclude evidence that might amount to infringement of parliamentary privilege, amply protect the privilege and freedom of speech of the House. However, that statement needs examining. I referred a case to the Committee of Privileges, which retrospectively said that, although permission was not asked, no apparent harm had been done.
  Instead of trusting ourselves to pass a resolution before allowing the courts to dabble in our evidence to settle their cases, the resolution puts the onus on judges to make the decision, and I am not certain that I want to do that. I therefore put down my gentle amendment, and I am grateful to the Leader of the House for indicating that he might accept

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  it. It is simply to remind judges, if it behoves them to read our resolution, that it is passed only while emphasising that the Bill of Rights has total priority. The resolution may not ask the judges to consult us every time, but any material from this House that might call into question our proceedings must not be admitted into court at any time.
  My motives have been misunderstood. My hon. Friend the Member for Bolsover (Mr. Skinner) has always misunderstood my motives, but if he hears me out he may understand me better.
  Mr. Dennis Skinner: I have not always misunderstood my hon. Friend's motives.
  Mr. Price: Only on this occasion. The right that we have to say things that no one in Britain can say elsewhere is absolutely priceless, and we must hold on to it. A study of history shows how important that is. Richard Cross man, Barbara Castle and George Wigg quite properly used their privileges in the House to open the Profumo affair to the public gaze and make the House debate a matter about which everyone knew. We have the privilege to say such things without their being brought into court.
  Last year, four hon. Members named Colonel Johnstone in the House. It was not a party matter. We felt that the Attorney-General was being completely oppressive in sanctioning the use of the Official Secrets Act against journalists.
  I readily acknowledge that my hon. Friend the Member for Bolsover played a far more important part in the recent business surrounding Anthony Blunt than I did. Absolutely properly, my hon. Friend used his parliamentary privilege in introducing, in a notice of motion, the words "Sir Anthony Blunt", so that the statement which was made the following day was an absolutely full statement, which otherwise it might not have been.
  Mr. Skinner: In what way will that privilege be under threat if the motion is carried? Suppose that tomorrow we manage to get the name of the fifth or the sixth man. Suppose that someone says it is the Duke of Edinburgh, or something like that.
  Mr. Price: I will tell my hon. Friend.
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  At this point, Mr. Deputy Speaker, I think I ought to declare an interest. I am being sued at the moment for libel. It arises over a book that I wrote. It was published outside this House. I do not think that the matter will come to court, because it is a maniac who goes to court as a defendant in a libel action. The sensible thing is to settle. But, if the matter were to come to court before this motion is passed, and I wanted to prevent the person who is suing me—he happens to be a former member of the Metropolitan Police—from using every mention by me of the Metropolitan Police in this House since I became a Member, I could do so by opposing his petition to mention those references. But, once the motion before us is passed, he will be able to say what he likes. I am not a lawyer, but I understand that in libel actions one way of proving a case against the person being sued is to collect everything he has said over a lifetime and then invite the jury to come to the conclusion that it all adds up to show that he is prejudiced against the police—or against Scientologists, or whoever it might be—and to come to the further conclusion that he is malicious and has been using malice.
  My point is that extracts from Hansard, which are meant to be protected, could be used in that sort of way against me. I am not saying that this would happen very often, but we have to be careful about anything which infringes freedom of speech in this House or anything which makes people less likely to say things in this House which they feel they have a duty to say. We have to be careful about any sort of intimidation, especially on the part of powerful groups outside this House which have the power to hire more expensive lawyers than my hon. Friends or I would ever have the money to hire. Anything which would have that effect ought to be examined with very great care.
  That is the only issue with which I am bothered here. As for anything else, I am with the Leader of the House. Let them quote the lot. But the judges should be put on warning that using Hansard against hon. Members in an intimidatory manner ought not to be permitted. Hansard should not be admitted in evidence in that way.
  Putting down the amendment and having this debate is one way that we have

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  in this country of putting judges on warning. The debate might get a bit of publicity. It might serve to remind our courts of the separation between the courts and Parliament and of what their duties should be. It is often assumed from reading our former Clerk's memoranda that these petitions always go through and that there is no problem—that it is just a meaningless formality. That is not so at all.
  My hon. Friend will remember that our right hon. and learned Friend the Member for Dulwich (Mr. Silkin), the then Attorney-General, wanted to quote Hansard in 1975 to sustain what I think was a thoroughly scurrilous action designed to prevent the publication of Richard Crossman's diaries. Those diaries provide the most splendid window through which to see how government works that has appeared in Britain since the Second World War.
  When the then Attorney-General wanted to introduce Hansard into evidence, hon. Members on both sides of the House, including the hon. Member for Tiverton (Mr. Maxwell-Hyslop) and my hon. Friend the Member for Nottingham, West, were so affronted that they, very properly in my view, used the procedures of the House to drag the debate on until fewer than 40 hon. Members were present, so that when the vote took place the motion fell. It was, therefore, not possible for my right hon. and learned Friend the Member for Dulwich to use Hansard in trying to sustain his case. I am happy to say that, at the final fence, his case collapsed and the Cross-man diaries were published.
  We are not getting rid of a meaningless formality at all. It is a very real instrument which this House has quite recently used. I am not making a party point, because my own party's Attorney-General was involved. I have an enormous respect for him in other ways but not in relation to the prosecutions he launched in that particular way.
  We are talking about a great deal more than a narrow little change. We are talking about the very basis of freedom of speech in this House. It may be said that we can trust the courts to rule out evidence which would contravene the Bill of Rights. I hesitate to quote my right hon. and learned Friend on the courts.
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  He has said some very eloquent things about the courts from time to time, and I agree with him that if we had trusted our judges over the past 400 or 500 years we would not have our present democratic House of Commons.
  I do not trust the judges that much. The real danger we are in at the moment is that it is the judges who are making the inroads into parliamentary power day in, day out. Lord Denning said, off the cuff, the other day that a Bill had been passed in Parliament by only one vote and that was the reason for his making a particular ruling. I believe that that is the sort of arrogance that the House ought to stand up against and is another reason why we should be very careful of handing over a single privilege of this House to the judges.
  Some of the judges are nice people, but they have quite different views and interests from our own. We are the democratic representatives of the people and they are the judicial appointees of the Crown. The two roles are quite different. I believe that we should cling on to our privileges, and that we should have more and should hand fewer of them over to the judges.
  There is another issue upon which my hon. Friend the Member for Nottingham, West may have rather more to say than I have. We use the words "proceedings in Parliament" in the Bill of Rights and in our reports of the Committee of Privileges. My hon. Friend is quite right. Nobody has the faintest idea what the words "proceedings in Parliament" mean. Since we have begun to broadcast our proceedings, I think that the position becomes even more difficult if we hand over, wholesale, for the consideration of the courts both the written record of Hansard and, side by side with it, the broadcast oral record of our proceedings.
  Anyone who has compared the broadcast record of our proceedings with Hansard knows that the two do not coincide. That is no problem for us, because Mr. Speaker can rule that what he hears is what is published in Hansard. He hears what he hears and that is an end of the matter. If Hansard and the tape recording can be adduced in court—
  Mr. St. John-Stevas: The hon. Member makes an interesting point. However, the motion refers only to the Official

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  Report. The tape recordings are not the official report.
  Mr. Price: I know that they are not the official report of the House. I was trying to define "proceedings in Parliament". We refer to the Official Report and not the tape recording, but the judges say something different. Lord Denning is good at that.
  Mr. English: At present, the copyright of the tape of our proceedings is vested in Tannoy or the BBC but not in the House of Commons. I cannot see that the tape could fail to be produced in court if a court ordered its production. A company such as Tannoy has no rights or privileges. Since that is so and the Official Report can be compared with the tape, it must be possible to ask which is right if they differ. If that is possible, the difference can be explained only by the Editor of Hansard and his staff. The Committee of Privileges cannot be summoned before a court without the permission of the House. Where do we go from there?
  Mr. Price: I do not know where we go from there. I am simply asking questions which I am sure the Minister will be able to answer.
  I have been involved, with the hon. Member for St. Marylebone (Mr. Baker), in an excellent programme called "Party Pieces" which is broadcast on Capital Radio at 7.30 p.m. each Friday. The structure is little bits of chat by the hon. Gentleman and I, and bits of réalité, or real talk, from the House. When one compares that with the account in Hansard, one is sometimes faced with two different versions. I do not say that this resolution refers to the broadcast record of the House, but once Hansard is adduced in evidence somebody might produce something which proved or disproved Hansard.
  The Committee of Privileges did not give as much thought to this matter as it should have done. The Leader of the House was not fair to bring forward one report of the Committee which deals with quoting Hansard in court while not dealing with the more important report. As a result of the Colonel B episode, that report recommends that we should accord to fair accounts of our proceedings in the
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  newspapers the privilege which we already accord to Hansard. That is particularly important since only last year Mr. Thomas He Herington, the DPP, issued a statement threatening the newspapers with prosecution if they printed what was said in Hansard. He did not prosecute them in the end, because the papers and the BBC saw it for the empty, stupid, idiotic threat that it was in the first place. It was an attempt by the DPP, under the control of the Attorney-General, to gag the House.
  I thought that we should get all the reports of the Committee of Privileges. In fact, we have what I consider to be the least important and the least well considered report of the Committee.
  Although I move my amendment, because I think that it would improve the motion, until I hear the right hon. Gentleman I am not satisfied that we have it right yet.
  10.40 pm
  Sir Derek Walker-Smith: It is a pleasure and privilege to follow the hon. Member for Lewisham, West (Mr. Price), who has, to my knowledge and the knowledge of the House, taken a close and continuing interest in these matters, and has made a substantial contribution to them.
  Having said that, I at once dissent from two of the hon. Gentleman's propositions. First, his picture of a judiciary eager to encroach upon and usurp the privileges and prerogatives of Parliament is farfetched, to say the least, and does not at all accord with the sensitivity of the members of the judiciary, as I know them, to the privileges and position of Parliament. Secondly, I cannot accept the hon. Gentleman's criticisms of the report and proceedings of the Committee of Privileges, although I think he will confirm that they were very friendly exchanges that we had in the Committee.
  We are here dealing with one of he privileges of the House. I have never liked the word "privilege". I do not like it in this context. In reality, what we in our parliamentary idiom call "privilege" is the mechanism for protecting freedom of speech and the practice of parliamentary democracy. So it is important, because everything concerned with Parliament's position is important.

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  But we should not exaggerate—perhaps the hon. Gentleman did a little—the importance of the motion. It is essentially part of the tidying-up process which must continually go on in Parliament, whereby each Parliament in its generation seeks to bring its practices and procedures into line with contemporary realities and requirements.
  It is one of the agreeable paradoxes of this place that any attempt to review and update parliamentary procedures brings out all the innate conservatism of some of our radical Members. That is no doubt gratifying, although paradoxical in its way.
  For myself, I am content to bring the letter of our procedures up to date if the spirit remains intact. In the words of the Clerk's memorandum to the Committee, at paragraph 36,:
  "In these circumstances the Committee may wish to consider whether the procedure by way of petition for leave and a subsequent order for leave has now become"—
  and then there follow the words that the hon. Gentleman did not like—
  "a meaningless formality and of little practical value in maintaining the privileges of the House; and whether as such the procedure could be dispensed with."
  We came to the conclusion that it could be dispensed with.
  Our distinguished Chairman is nolonger with us. The hon. Gentleman has said that the right hon. Member for Ebbw Vale (Mr. Foot) and I are the sole relics. It sounds rather like the yoking of Anselm and William Rufus.
  The question whether the words "meaningless formality" are a little pejorative is neither here nor there. The important thing is whether, as such, the procedure could be dispensed with. In our view it could, in the terms of this motion as amended; and I am here tonight to defend the decision.
  Mr. English: Can the right hon. and learned Gentleman explain something that puzzles me? Paragraph 2 of this very short report approves of the Resolution of 26 May 1818:
  "in respect of the matters to which it strictly relates".
  One of those matters is:
  "That all witnesses examined before this House, or any committee thereof, are entitled to the protection of this House, in respect of
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  anything that may be said by them in their evidence."
  At the moment witnesses are undoubtedly protected because what is said cannot be repeated before any other court without the permission of this House. If this motion is passed, such matter will be capable of being repeated. I know that the right hon. and learned Gentleman and I agree that that does not mean that those witnesses could then be sued in defamation. But surely it could be quoted against them as, perhaps, contradictory to something they said in some other circumstance, in some other type of action. If it could be quoted against them, how will the House have the opportunity to protect them for what was said before us?
  Sir D. Walker-Smith: They will not need that protection because they keep the protection given them under the 1818 resolution. The only thing that is taken away is the requirement of leave to cite Hansard. If the hon. Member for Nottingham, West (Mr. English) studies the cases with the care that he habitually uses, he will appreciate that that does not expose hon. Members to any penalties or threats of action. Indeed, they would have a legal privilege for what is said in court in addition to this privilege.
  I do not want to take up too much time but I should like to make three short points in this context.
  Mr. Skinner: Before the right hon. and learned Gentleman goes on to fresh territory, I should like to ask him a question on the point raised by my hon. Friend the Member for Nottingham, West (Mr. English). In 1973–74, Alan Grimshaw gave evidence before the Select Committee on Nationalised Industries with regard to the sale of pit props. There was an investigation by that Committee as to whether there had been any corrupt practices. Alan Grimshaw, who worked for the National Coal Board in a responsible position, gave evidence and has not had his job back since that time. It is a matter that has been raised in the House many times, not only by myself but by many other hon. Members, asking for it to go before the Committee of Privileges. What the right hon. and learned Gentleman is saying is that in theory there should be no Alan Grimshaws thrown out of work by the NCB because they

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  have given evidence against certain management personnel of the NCB. However, that gentleman is still writing letters to Members of Parliament and others trying to have his case investigated. So in practice it does not work out as the right hon. and learned Gentleman suggests.
  Sir D. Walker-Smith: The hon. Member for Bolsover (Mr. Skinner) has raised an interesting point. However, it is a wider matter. Mr. Grimshaw's position vis-à-vis the National Coal Board, or any subsequent employer, is not changed by the terms of this motion. This is a narrow motion simply referring to the citation of Hansard in a court of law.
  The three short points that I want to make are as follows. Petitioning for leave is a formality, and it is certainly not a very significant formality, because in practice leave is never refused. When the House is in recess, leave is actually given by Mr. Speaker without reference to the House. Therefore, it is not a very substantial matter. Indeed, its basis is somewhat tenuous, as the House can see from the memorandum of the Clerk at paragraph 31:
  "…it is doubtful whether the House has ever addressed itself to the question whether leave of the House is required for the production of Hansard and other published documents in court. There is no resolution of the House on this score and no case of production without leave has hitherto been treated as a contempt."
  That is my first point. I come now to the second.
  The practice which we are today amending or rescinding had its origins at a time when publication of the proceedings of the House itself was forbidden. That dates back to the resolution of 3 March 1762, and hon. Members can see reference to it at paragraph 28 of the Clerk's memorandum which sets it out in full. But it is in the recollection of many here present that that practice was discontinued by resolution of the House in July 1971, which also is set out in the memorandum, at paragraph 29.
  We are, therefore, in a different climate and a different situation from the time when the resolution was in full operation.
  Mr. English Mr. English rose—
  Sir D. Walker-Smith: I shall give way, but I am trying to be brief, since otherwise my right hon. Friend will not be able to reply to all the interesting points that the hon. Gentleman puts.
  Mr. English: I am sure that the right hon. and learned Gentleman wishes to be fair. He will agree that the resolution of 1762, together with other resolutions of the eighteenth century—the one in 1762 was not the only one—had by early in the nineteenth century been forgotten and dropped. Although that particular resolution was not formally rescinded until the date that the right hon. and learned Gentleman gave, for a long time Hansard,either as a private publication or as the Official Report, had been published.
  Sir D. Walker-Smith: Yes, but the hon. Gentleman must try to be consistent. He says that the resolution of 1762 was quietly dropped and that was a good thing. I am here saying that this practice should be dropped, not quietly, not by subterfuge, but openly and properly. He should support that and agree that we are tidying up the procedures of the House.
  I come now to my third point, which is, perhaps, the most important. The work of the House and its proceedings were very different indeed in 1818 when the resolution was passed. In those days the majority of the work of the House of Commons was not the public legislation as of today but was in Private Bill and Local Bill legislation. Hon. Members have only to go to the Library to see from the statute books that that was so.
  That was the reason for the resolution. It appears clearly in the terms of the resolution itself:
  "That all witnesses examined before this House, or in any committee thereof, are entitled to the protection of this House, in respect of anything that may be said by them in their evidence."
  It then goes on to refer to the minutes and so forth. That is what it was concerned with. It was not concerned with the ordinary give and take of public debate on great national issues such as we have today and which dominate the columns of Hansard. It is an entirely different scenario, and, after 160 years or so, even we less radically-minded Members begin to think that perhaps there is a case for

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  bringing the matter under review and bringing it up to date.
  Mr. Ivan Lawrence: My right hon. and learned Friend is a distinguished lawyer, and I should appreciate his view on whether the circumstances of the new scenario might precipitate a change in the construction of statutes. If it is to be the law in future that the Official Report of the House can be cited in courts of law without the leave of the House, how long will it be before the courts are construing documents with reference to Hansard, without the leave of the House? Would that not be a retrograde step in the development of our law?
  Sir D. Walker-Smith: Like the hon. Member for Bolsover, my hon. Friend seeks to enlarge the scope of the debate into an interesting area. However, I am always apprehensive when anyone prefaces his observations by referring to me as a distinguished lawyer. I know then that I had better be very careful.
  Parliament differs from many practices of the court, because normally, in English law, a statute cannot be construed by reference to the travaux preparatoires—in other words, the debates that gave rise to it. As we adhere to the Community, that may go. My hon. Friend must not tempt me into wider aspects, as I do not wish to delay the House.
  It was to the protection of those witnesses and proceedings—primarily in Committee—that the resolution of 1818 was mainly directed. That resolution was therefore concerned with very different matters from the mere citation of Hansard,covering the broad issues with which Parliament is concerned. Anyone can buy Hansard today if he can afford it.
  Mr. Michael Foot: Will the right hon. and learned Gentleman, in his most distinguished capacity—or any capacity he wishes—answer another question that might help us? Does he not think that the debate tonight shows that it might be better for the House to consider all the reports together, particularly in the light of the intervention by the hon. Member for Burton (Mr. Lawrence)? Some of those reports touch on one another. When the Committee of which we were both members agreed on the report and recommended it to the
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  House, it did so in the context of the other recommendations. That recommendation was correct, particularly as the point concerning the Bill of Rights has been so properly emphasised. Does not the right hon. and learned Gentleman think it is wiser to discuss those reports together—as it is not a party issue—so that we can look at the connection between them? We might thereby obtain a better resolution of the subject than by picking out one report, and one aspect of that report, when obviously several hon. Members wish to raise cognate matters.
  Sir D. Walker-Smith: I agree to the extent that I always like such matters to be debated on the Floor of the House as much as possible. The right hon. Gentleman, as a former and distinguished Leader of the House, knows that such matters are not for me. I am a humble Back Bencher and, rather like James Forsyte, I sometimes feel "Nobody tells me anything".
  Mr. Foot: Of course this is a matter for the right hon. and learned Gentleman. No recommendation from the Select Committee can become part of the accepted procedure of the House until it has passed through a proceeding such as this. He has as much right to influence it as others. Perhaps the House of Commons can best deal with such issues if we take together those matters that we considered for many hours in Committee. The Leader of the House has picked out one of those reports—one aspect of the matter—and presented it to the House. However, the debate indicates that hon. Members wish to raise other issues as well. The final say rests with the House of Commons. No procedures of the House can be changed unless the House agrees. No twopenny-halfpenny Committee can change those procedures.
  Sir D. Walker-Smith: Constitutionally and procedurally the right hon. Gentleman is correct. I do not know about his description of that Committee as considering the inflation that took place under the Labour Government, the phrase twopenny halfpenny seems rather pejorative. I am being led to take longer than I had intended, and I will leave it to the Minister to answer that point as he will do very well.

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  The right hon. Member for Ebbw Vale mentioned the Bill of Rights. I wish to conclude with a reference to the Bill. As the right hon. Gentleman will recall, in coming to its decision the Committee had closely in mind the preservation of the protection given by article 9 of the Bill of Rights for freedom of speech in Parliament. That appears clearly from paragraph 19 of the Clerk's memorandum in which he refers to the Bill of Rights:
  "the freedom of speech and debates or proceedings in Parliament ought not to be impeached or questioned in any court or place out of Parliament."
  Mr. Justice Pearson, as he then was, a distinguished jurist, said in his judgment, to which the memorandum refers:
  "In my view, it is quite clear that to impugn the validity of the report of a select committee of the House of Commons, especially one which has been accepted as such by the House of Commons by being printed in the House of Commons Journal, would be contrary to section 1 of the Bill of Rights. No such attempts can properly be made outside Parliament."
  In coming to our decision, we had in mind the necessity of the basic protection given by the Bill of Rights to the proceedings of Parliament. The amendment makes that crystal clear and therefore I wholeheartedly support the amendment, as well as the motion.
  By tonight's work and the work of the Committee of Privileges, we shall have achieved a sensible, salutary solution and will bring our procedings into line, in this respect, with contemporary circumstances and requirements, while maintaining the basic defences of our freedom of speech and parliamentary practice.
  11.2 pm
  Mr. Michael English: The Committee of Privileges is the oldest and most senior of the House's Committees and we set it up so that it could consider questions that Mr. Speaker rules to be prima facie breaches of privilege. If the House considers that there is a prima facie breach, it may refer the matter to the Committee of Privileges, which includes the Attorney-General, to consider the details of the case and to report to the House whether, in the view of the Committee, a contempt of the House's law of privileges has been committed.
  When the Committee goes further and makes recommendations, resulting from
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  an individual case, for a change in the law of contempt of privilege, it is in danger of committing the sin, well known to the right hon. and learned Member for Hertfordshire, East (Sir D. Walker-Smith), that hard cases make bad law.
  It is dangerous for a body set up to consider matters quasi-judicially, as we wish the Committee of Privileges to do, to make recommendations for a change in the law of Parliament which it is interpreting. For one thing, that law applies to both Houses; and for another it is difficult to tinker with a tiny piece of that ancient structure without bringing the whole thing toppling down.
  A Joint Committee of both Houses, chaired originally by Lord Pearce and subsequently by Lord Donovan, of which the Attorney-General who sat on the Committee of Privileges whose recommendation we are considering was also a member, has considered the whole law of privilege, because of the necessity to revise it in the light of broadcasting.
  The fact that the reports of the Committee have not been dealt with, and should be dealt with, does not mean that we should deal with one tiny piece of the report separately and in isolation. I shall attempt to show that, if we approve a tiny piece in isolation without considering the whole position, we shall be in grave danger.
  I therefore go back to how this all began. You will remember, Mr. Deputy Speaker, that in the 1964–66 Parliament there was still in existence an old institution called the Committee on the Publication of Debates. That Committee discovered that it could consider if it wished the question of broadcasting the House. Although it was dissolved and absorbed into the House of Commons (Services) Committee, it nevertheless considered this precise point.
  In its first and only report, the Committee which it became to consider the issue—the Select Committee on Broadcasting, &c., of Proceedings in the House of Commons—on page xviii said:
  "The extent to which the broadcasting organisations would be liable for defamatory statements made in the House and subsequently (or simultaneously) included in broadcasts is a point of some obscurity."
  I do not wish to go into great detail on that, but the Committee pointed out the situation in Australia, where, of course,

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  the law of this Parliament applied up to the point of separation of the Houses of the Australian Parliament from this one.
  "In Australia, where the broadcasting of Parliamentary proceedings was first permitted in 1946, similar questions of privilege were raised: they were met by the inclusion in the Parliamentary Proceedings Broadcasting Act, 1946, of a section which laid down that 'no action or proceeding, civil or criminal, shall lie against any person for broadcasting or rebroadcasting any portion of the proceedings of either House of the Parliament.' "
  I have outlined now the beginning of all this issue. It raised a hornet's nest. It was discovered slowly that the issue was by no means clear. It was next considered in 1968, this time by their Lordships' House, by its Select Committee on Broadcasting the Proceedings of the House of Lords. It considered parliamentary privilege and the law of defamation, which are the subjects with which we are mainly concerned at this point. Referring to a previous Committee, its report said:
  "That Committee went on to recommend that the whole subject of the reporting of Parliamentary proceedings should be referred to a Joint Committee of both Houses, with strong legal representation in its composition."
  It added that it wished to place on record its own agreement with that previous Committee's recommendation. So far, amongst these references, one can find traces of one Select Committee of this House and two of their Lordships' House.
  Subsequently, in October 1968, the House of Commons (Services) Committee, which had taken over some of the broadcasting responsibilities, referred, on page vi of its appendix, to the legal problems involved in broadcasting. It mentioned their Lordships' Select Committee report which I have just quoted. It said:
  "Another problem which will also require urgent consideration is the state of the law of Parliamentary privilege as it might affect broadcasting."
  It went on:
  "The Sub-Committee endorse the recommendation—
  that is, the one by the Lords' Committee—
  "for the setting up of a Joint Committee of both Houses."
  Then we come to that Joint Committee. It was originally chaired by Lord Pearce, a Lord of Appeal at the time, and subsequently by Lord Donovan. Its membership included the Earl of Selkirk, Lord
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  Stow Hill, formerly Sir Frank Soskice, who had served as Attorney-General and then as Home Secretary, Charles Pannell, now Lord Pannell, Sir John Foster, QC, my right hon. and learned Friend the Member for Dulwich (Mr. Silkin), later Attorney-General, and for a time Sir Peter Rawlinson, now Lord Rawlinson. I, too, was a member.
  That Committee produced two reports. To my knowledge, its first report has never yet been debated in this House. That first report of the Joint Committee on the Publication of Proceedings was printed in December 1969, and simply suggested that the BBC, in terms of live broadcasting, should be put in the same position as the press. Hon. Members may recollect that in about 1952, Lord Lever, then in this House, got a reform of the statutory portion of the law of defamation which enabled the press to quote in almost complete safety, even in abbreviated form, from the proceedings of this House. The press was allowed to quote in substantial safety as a result of what is now called "qualified privilege". That applies to the law of defamation in so far as the BBC summarises the proceedings in its own words, but in so far as it uses the tapes, apparently it does not.
  Mr. Deputy Speaker (Mr. Bryant Godman Irvine): Order. The debate relates to the Official Reports of this House. It is not clear to me exactly how the hon. Gentleman's argument is related to that.
  Mr. English: I think that the point will be clear to you at any moment, Mr. Deputy Speaker. If the BBC or the press summarise the Official Reports of this House, they are protected under the law of defamation. If the BBC summarises the proceedings on its tape, or if it broadcasts them in summary form, as it is doing every day, and if anyone wishes to sue on that, he can because that is not so protected. The point at issue is how far they differ. Since they do differ, there is now substantial doubt because one is protected at present whereas the other is not.
  It was pointed out 10 years ago that that would be the case if broadcasting were allowed to take place without the law of Parliament being altered. However, I turn to the direct case about which we are talking. The second report of the

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  Joint Committee was much more comprehensive. The first report was intended to be an interim report so that that minor matter could be put right in order that the BBC was put in the same position as the rest of the press.
  The minor matter was reported on first so that it could be dealt with quickly. However, it has not been dealt with yet. We then come to the second report, which was what the Committee was set up to do. It was a complete and comprehensive review of what
  "changes in the law of defamation and Parliamentary Privilege are desirable in relation to the"—
  Mr. Deputy Speaker: Order. The hon. Gentleman is in no way illuminating the matter so far as I am concerned. Perhaps he will be good enough to have a look at the motion and return to that.
  Mr. English: As I read it, the debate relates to two things. The original motion, which I believe we are not now discussing, related to the publication of proceedings and some change in our law of privilege relating to the publication of
  "the Official Report of Debates and to the published Reports and evidence of Committees".
  The amendment seeks to insert:
  "while re-affirming the status of proceedings in Parliament confirmed by Article 9 of the Bill of Rights."
  Given the composition of the Committee chaired by Lord Donovan, it could perhaps be described as being the authoritative text of what a proceeding in Parliament is. Beginning on page 8 of the second report, paragraphs 12 to 34 deal with the very phrase "proceedings in Parliament".
  Mr. Skinner: Explain it.
  Mr. English: What surprises me is that the Committee of Privileges did not consider this question at all. It is most improper for the Leader of the House to come before the House at one parliamentary day's notice—because this motion was tabled on Thursday and published on Friday—which means that most hon. Members are not aware that this matter has ever been recommended in great detail to the House as a whole.
  As I said earlier in my point of order, when Mr. Speaker was in the Chair, the
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  result is that the Government have again slipped up and not produced the documents. I am quoting from the Library copy. That means that nobody else can quote from it. I do not know if the civil servants who serve the Leader of the House have given him a copy. All the other documents that I have here do not come from the Vote Office—they come from my files.
  It is incredible that we are discussing the meaning of the words "proceedings in Parliament" without having before us the reports which have attempted to define that meaning.
  Mr. Skinner: I am one of those hon. Members who is not informed on this matter. I came into the Chamber to see what was happening. My hon. Friend the Member for Nottingham, West (Mr. English) mentioned paragraphs 12 to 34 of the authority he has before him. I believe that it would be a good thing for him to read out the contents of those paragraphs, so that we know how those proceedings are defined, as we do not have the chance of reading that authority.
  Mr. English: Certainly, that is the only way in which the House will be informed on the matter. Lord Donovan and his colleagues said:
  "Since these proceedings are expressly made the subject of absolute privilege by the Bill of Rights it is important, alike for Members of either House as for members of the public, to have as clear an idea as possible of what are and what are not 'proceedings in Parliament'. Whilst participating in such proceedings Members are at present immune from being called to account in the Courts for any defamatory statement they make in the course of such participation, however false or malicious it might be: and the member of the public so defamed is without redress. Yet the term has never been defined by statute or judicial decision".
  Paragraph 13 continues:
  "When the framers of the Bill of Rights used the expression 'proceedings in Parliament' in 1688 and did so in the same context as 'debates' it is probable that they had in mind a fairly simple conception of an assembly where debates were followed by resolutions or bills and the proceedings were not marked by much complexity. In such a situation, the need for a definition of proceedings in Parliament might not have been felt. Matters are very different today when Parliament conducts much of its business through Committees of different kinds and which may at times sit elsewhere than in the Palace of Westminster, and when procedures have been invented which were unknown in Stuart times.

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  the proceedings and usages of Parliament today are dealt with in a standard work…"
  Lord Donovan goes on to refer to "Erskine May."
  Ten years ago, Lord Donovan was much clearer about the realities of the fact that this House used committees than the right hon. and learned Member for Hertfordshire, East has been. Amazingly enough, the right hon. and learned Gentleman was quoting the use of witnesses before Select Committees in the nineteenth century just after the House has agreed, in spite of the reservations of my right hon. Friend the Member for Ebbw Vale (Mr. Foot), to the setting up of a set of Select Committees. The question of witnesses is now more relevant today than at any time since the nineteenth century.
  Sir D. Walker-Smith: The 1818 wording is quite specific—before "any committee of this House". It could not be a larger definition than that. That means any committee at the material time in the House of Commons. It cannot mean anything else.
  Mr. English: I believe that it can. As the right hon. and learned Gentleman will know, although the House is singular, Committees are plural. A Committee of this House means any two people—the committees, is a better pronunciation. It does not mean Committee in the singular sense that the right hon. and learned Gentleman implies.
  Mr. Maxwell-Hyslop: Further to that point, is a Joint Committee a Committee of this House? Secondly, a previous Clerk of this House advised me that he was unable to agree with Mr. Speaker's Counsel as to whether the proceedings of the Ecclesiastical Committee were proceedings in Parliament.
  Mr. English: I am grateful to the hon. Gentleman for his last, most helpful, point. The Ecclesiastical Committee is not a normal Joint Committee of both Houses, being a Committee set up by statute, as I once had occasion to point out when the statute's procedure was not being followed and something was struck off the Order Paper.
  On the hon. Gentleman's first point, I mentioned earlier that the reason why that was best considered by a Joint Committee of both Houses was that both
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  Houses are concerned in the law of parliamentary privilege which is not solely the privilege adhering to either House. A Committee or Joint Committee is covered by that principle, but that is so because it is parliamentary and not just a matter for the Commons or for their Lordships' House.
  The Lord Donovan went on to say in paragraph 14 that
  "The 1840 Act",
  the Parliamentary Papers Act, with which I am sure the right hon. and learned Gentleman is well acquainted
  "uses the expression 'proceedings' obviously as meaning proceedings in Parliament, the full expression being 'reports, papers, votes or proceedings', but again no definition of proceedings is attempted."
  That was a Committee that included at least two Lords of Appeal, several QCs and other Members of both Houses.
  Lord Donovan then quotes the Select Committee on Parliamentary Privilege. To save the time of the House and your patience, Mr. Deputy Speaker, I have not even quoted that one. It is the fourth or fifth of these innumerable reports that have not so far been mentioned in the debate. However, Lord Donovan had not forgotten it.
  The Select Committee on Parliamentary Privilege was strongly of the opinion that absolute privilege should attach to matters that are there mentioned.
  In paragraph 27, Lord Donovan finally came up with this:
  "The Committee agree that proceedings in Parliament should continue to be protected by absolute privilege. They consider, however, that the time has come"—
  that was in 1969 or 1970–
  "when 'proceedings in Parliament' for this purpose should be defined by Statute."
  We are talking about a resolution and amendment before us relating to the words "proceedings in Parliament". We are talking about something which10 years ago it was suggested should be defined. The right hon. and learned Gentleman said that he would accept the amendment, so are we being asked to pass tonight something that is quite literally regarded by a group of eminent lawyers and eminent Members of both Houses as meaningless?
  Mr. St. John-Stevas: With the leave of the House—
  Mr. English: The right hon. Gentleman is interrupting.
  Mr. St. John-Stevas: I am sorry. I thought that the hon. Gentleman had finished.
  Mr. English: If the right hon. Gentleman wishes to intervene, I shall willingly allow him to do so. However, the right hon. Gentleman determined the length of the debate. As a member of the Government with some influence over the Stationery Office, he determined that this House should not have these papers before it. He is also the man who said that we should have a limited time to discuss a limited subject, without knowing that it was part of a much wider subject and without having the documents on that subject. If the right hon. Gentleman wishes the debate to have a lengthier time, we could well adjourn until such time as he thinks fit.
  Mr. St. John-Stevas: I am grateful to the hon. Gentleman for giving way. I have no particular axe to grind about this. I merely wish the House to have an opportunity to discuss the various reports of the Privileges Committee. It seems logical to start with one and eventually go on to another. As to the other reports to which the hon. Gentleman referred, they were not referred to in the report of the Committee of Privileges. It is really not reasonable to suggest that they should be made available by me, using some influence over the Stationery Office that I only wish I did possess. Alas, I do not possess it.
  I do not feel strongly on the issue. I tabled the motion. I hope that the House will have an opportunity to decide on it. If it does not, no doubt at some other time there will be another opportunity. We may have to wait a bit.
  Mr. English: I am grateful to the right hon. Gentleman. It would be better to wait until the reports of the Joint Committee of both Houses on this subject has been considered. We have been described by the right hon. and learned Member for Hertfordshire, East as radicals acting like conservatives. We thought that the Committee of Privileges was supposed to act like conservatives, to act quasi-judicially and to act like a court. Here it is recommending changes in the law rather than interpreting what it
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  is. But that job has already been done, on a much more massive scale, by a Joint Committee of both Houses, which is how it should be done. As was pointed out, it is parliamentary privilege that is at stake and not just the privileges of one House.
  But let us consider what Lord Donovan suggested should be included but was not included. Remember that this was approved unanimously by his Committee after he drafted it. He said:
  "(1) For the purpose of the defence of absolute privilege in an action or prosecution for defamation the expression 'proceedings in Parliament' shall without prejudice to the generality thereof include

  (a) all things said done or written by a Member or by any officer of either House of Parliament or by any person ordered or authorised to attend before such House, in or in the presence of such House and in the course of a sitting of such House, and for the purpose of the business being or about to be transacted, wherever such sitting may be held and whether or not it be held in the presence of strangers to such House: provided that for the purpose aforesaid the expression 'House' shall be deemed to include any Committee sub-Committee or other group or body of members or members and officers of either House of Parliament appointed by or with the authority of such House for the purpose of carrying out any of the functions of or of representing such House; and

  (b) all things said done or written between Members or between Members and officers of either House of Parliament or between Members and Ministers of the Crown for the purpose of enabling any Member or any such officer to carry out his functions as such provided that publication thereof be no wider than is reasonably necessary for that purpose.

  (2) In this section 'Member' means a Member of either House of Parliament; and 'officers of either House of Parliament' means any person not being a Member whose duties require him from time to time to participate in proceedings in Parliament as herein defined."
  That definition is longer than the whole of the report that we are discussing tonight, but it illustrates that what the report misses out is in many ways much more important than the small points that it puts in. Of course, it is a seemingly small point that this House should consider first whether the wording of an Official Report can be used. It is not a small point when the alter ego of that Official Report, its slightly different

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  brother or its sibling, the sound tape of our proceedings, is easily open and accessible to the courts.
  The House has not yet got round to considering what should be done with that sound broadcasting tape. We were rushed into broadcasting the House of Commons. We were told that, if we did so, as soon as the House of Commons Commission came into existence the copyright in the tape would be vested in it, and that, in the course of passing the necessary legislation on that, something would be considered on this question of how far it should be protected or the BBC should be protected. None of this has been done.
  The right hon. and learned Member for Hertfordshire, East is eminent in the law, but surely if it is now legally possible—
  Mr. David Hunt Mr. David Hunt(Wirral) rose in his place and claimed to move, That the Question be now put.
  Mr. Deputy Speaker: I am not prepared to accept the motion at this time.
  Mr. English: I am grateful to you, Mr. Deputy Speaker. It is quite clear not only that the motion before the House is premature but that an utterly inadequate amount of time has been allowed for discussing these very important issues.
  I have seven reports of seven Select or Joint Committees of both Houses of Parliament, none of which has been mentioned so far, except by me. None is available in the Vote Office. It cannot be true that the motion should be—
  Mr. Christopher Price: On a point of order, Mr. Deputy Speaker. Having moved the amendment in a real effort to get some finish to this business, would you accept from me a motion, That the question be now put?
  Mr. Deputy Speaker: No. I am not prepared to accept that motion at this time.
  Mr. English: I am grateful to you, Mr. Deputy Speaker.
  It being half-past Eleven o'clock, the debate stood adjourned.
  Debate to be resumed tomorrow.

  BBC TRANSMITTER STATION, HENSTRIDGE
  Motion made, and Question proposed, That this House do now adjourn.—[Lord James Douglas-Hamilton.]
  11.30 pm
  Mr. Nicholas Baker: People in North Dorset, Somerset and Wiltshire will be grateful to you, Mr. Deputy Speaker, for granting me the opportunity of raising in the House the BBC's proposal to erect a transmitter station at Henstridge. I raise this matter out of no antipathy to the BBC. On the contrary, I strongly believe in the battered concept of public service broadcasting. I also take the view that the BBC's external services should be maintained to protect and promote the British way of life. My opposition to this proposal is that, if implemented, it would significantly impair and diminish that precious commodity.
  I should also explain that, in raising this matter, I have the full support of my hon. Friend the Member for Wells (Mr. Boscawen), in whose constituency the land lies. Although he is unable to intervene in the debate, the points that I shall make reflect the deep concern of his constituents and mine. My hon. Friends the Members for Westbury (Mr. Walters) and for Dorset, West (Mr. Spicer), who are unfortunately unable to be present tonight, have asked me to make clear that they support the case that I present.
  The BBC has applied for planning permission to erect at Henstridge a shortwave radio station consisting of approximately21 self-supporting towers holding aerial arrays and ancillary buildings on a 300-acre site. The station would transmit overseas radio services to Eastern Europe, the Soviet Union and perhaps South America.
  The transmitter at Skelton in Cumbria presently used for this purpose is outdated and the BBC, for reasons of audibility which I am advised are marginal, would prefer a southern site.
  The result of this proposal, if succesful, would be that bands of what appear to me as a former pig farmer to resemble pig wire up to one mile long strung between towers 300 ft. in the sky would be

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  beaming the broadcasts with 8 megawatts of power towards the ionosphere and Russia. The BBC has in mind that other transmitters would be added later.
  This proposal has aroused unprecedented alarm throughout the area of the Black more Vale. Concern is based upon the advice of radio engineers. Parish meetings in full halls of all the villages and towns affected have echoed this concern both at the proposal and at the inadequacy of the representations, the limited nature of the preparation and ground work and the non-assurances that were received from the BBC engineers at a recent public meeting.
  The first area of concern is radioactivity. Although the beams would be aimed into the sky, some spraying and reflection can be expected. The BBC states that radiation levels would be below the present maximum permitted level of 1,000 volts per metre. My understanding is that a new lower radiation level is under discussion. I ask whether the Government can give me assurance that any lower level would and could never be breached by a transmitter station of this kind. Even if they can, the National Farmers' Union and others are concerned about the effect upon the Henstridge grain store, which will use computer-linked electronic equipment. There is widespread concern about the effect upon the Plessey research establishment nearby which employs 600 people. People in the area are worried about their businesses, farms, livestock and health.
  Secondly, there is a fire risk. A radio transmitter causes induced voltages to occur in any length of conducting material, such as, for example, a wire fence. Within about a mile of the station the movement of, say, a petrol can against a tractor could produce a spark and start a serious fire. Garages, farms and industrial buildings in the area could be affected.
  Thirdly, and more certainly—and more ironically—there would, without question, be serious interference with radio, television, hi-fi and other electronic equipment. I am advised that the effect of induced voltages at short range would be to blot out radio and hi-fi reception within 3 miles and seriously impair television reception. The effect of interference at
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  greater distances is, say the BBC engineers, hard to guess. The area health authority advised me that modern heart pacemakers will be affected. Most hearing aids will not work close to a station of this kind.
  The fourth and major concern is for the environment of this specially beautiful part of England, lying as it does next to one area of outstanding natural beauty and bordering another area awaiting such designation. Although Tess of the d'Urbervilles might have been glad of a landmark as she wandered the lanes of Marnhull, the tourists and visitors who come to see the vale made famous by Thomas Hardy would be shocked by such an act of vandalism. There are many who have chosen to retire to this unique piece of English countryside. As a result of this proposal, the amenity for which they have saved is gravely threatened.
  Property values would, of course, be affected and, perhaps even more serious, small technically skilled businesses of the kind now providing employment in Dorset would be discouraged. Certainly this station would provide no employment in the locality. The effect upon the nearby helicopter station at Yeovilton is a defence aspect which should be considered.
  My right hon. Friend's Department described the land, when dismissing a planning application in November 1976, as being in
  "an isolated position, in open countryside, where it is the local planning authority's present policy to limit development to that required to satisfy a special, agricultural, or other local need.…In view of this location and the proximity of the site to a village in which only minimal development is acceptable, industrial use of the land is inappropriate."
  This was in the context of current land use policy, notwithstanding the fact that some industrial development had been permitted. It is land near to this which is the subject of the present application.
  I make it clear that the area affected by the proposal is large. No doubt contrary to the BBC's impression, it is well populated. The area potentially affected contains, so far as I can estimate, over 100,000 people. We are not debating whether the BBC should broadcast to Russia. However, it seems hard for the BBC to justify considering only Dorset and part of Somerset in its preparation for

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  this scheme. We have to apply the technical skills our country possesses to advanced science and at the same time protect the amenities of our countryside.
  Simply to move to a new site as the way out of a technical problem is no answer. Despoliation of the countryside, on the Masai principle, will not do. There was a time when Governments could plant monstrosities of this type in an area without regard to local feeling. That is not an appropriate attitude today. A proposal of this kind has many implications, all of them serious, long-lasting, and highly damaging for North Dorset, Somerset and Wiltshire.
  It is inconceivable that such a proposal could proceed without being called in for a public inquiry. My right hon. Friend the Secretary of State could achieve this by calling in the application under section 35 of the Town and Country Planning Act 1971. In this case the technical or scientific aspects of the proposed development are, in my opinion, of so unfamiliar a character that planning inquiry permission under sections 47 and 49 might be appropriate. My right hon. Friend has no doubt considered that approach.
  I have said that this proposal has not been thoroughly thought out. It is a boffin's dream. It is not only that; it is a dream which the BBC cannot, and should not, pay for, because it will never pay the price for the destruction of a priceless amenity.
  Finally, I urge the Minister to take another approach. We do not want in that part of Dorset and Somerset a sword of Damocles hanging over the area for years. I urge him to arrange for an immediate withdrawal by the BBC of this ill-judged and dangerous application. My right hon. Friend the Secretary of State for the Environment has said that he is resolved to protect our precious environmental heritage. Let his hon. Friend do just that tonight.
  11.41 pm
  The Under-Secretary of State for the Environment (Mr. Marcus Fox): I rise with considerable concern to respond to my hon. Friend the Member for Dorset, North (Mr. Baker). I appreciate that in raising this matter he is representing the concern of many of his constituents and those of my hon. Friend the Member for Wells (Mr. Boscawen), who I see sitting on the Front Bench.
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  I am aware that Yeovil district council, which is the local planning authority to which the BBC has made its planning application, has received more than 500 objections to the proposal. I might add that additional objections have been directed to my Department. A number of anxieties are being expressed and not just from pig farmers, or ex-pig farmers. There is concern, as my hon. Friend has pointed out, about the visual effect of the aerial array suspended from 100-metre supporting towers.
  There are fears that a health hazard could arise from the radiation effect produced by transmissions from this proposed station which could be harmful to people, livestock and wild species. There is the possibility of serious interference with the performance of electrical equipment such as television sets, audio equipment, hearing aids and computers, a fact which has also been mentioned by my hon. Friend.
  I am not in a position to comment authoritatively on either the possible health hazards or the matter of interference with electrical equipment, but I can give my hon. Friend an assurance that we have looked into the dangers from radiation. I am given to understand that the BBC would certainly comply with all the international safety standards for such installations. In these remarks, obviously, I refer to any fire risks as well.
  Moreover, the BBC's own personnel would be working within the station complex. This would not be possible unless the strict requirements of the Health and Safety at Work etc. Act were satisfied. Some interference with electrical equipment within 1 or 2 miles of the station is expected. My hon. Friend thinks that the radius is somewhat greater than that. We shall see. But measures can certainly be taken by users of appliances and equipment to alleviate the effects of this interference.
  From what I have just said, I hope that my hon. Friend will not assume that I am prejudging any inquiry or planning application. Of course, these are not new problems for the BBC. Its experience of operating similar stations at Ramp sham in Dorset, which is adjacent to a major road, and at Daventry in North ants, where a large housing estate approaches almost to the boundary of the site, leads it to believe that any difficulties can be

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  overcome with reasonable co-operation from those affected.
  The question frequently asked is: why not merely replace the ageing equipment at Skelton in Cumbria? The answer involves considerable technical detail which I understand my hon. Friend had explained to him personally by experts from the BBC a week or so ago. I shall not, therefore, trouble hon. Members with detailed explanations of these technical matters other than to say that they concern the efficiency of transmitting signals in the required directions.
  The BBC has a commitment to provide radio services, both in the English language and the vernacular, to overseas countries. This commitment has been acknowledged in the discussions and negotiation in recent weeks between the Government and the BBC about the possible reduction in foreign language transmissions by the Overseas Service in consequence of the need to reduce public expenditure as part of the fight for national economic recovery. These overseas services are quite separate from the domestic services and are financed by a direct grant-in-aid from the Foreign and Commonwealth Office. The services are considered to be most valuable in explaining the British point of view and way of life, and the BBC has gained a reputation for high quality programmes and the presentation of accurate and unbiased news broadcasting.
  Indeed, hon. Members will be interested to know, as my hon. Friend said, that a lively three-hour meeting was held recently under the auspices of the Henstridge parish council in order to question BBC experts and scientists from Southampton university about the proposed radio station.
  Mr. Jim Spicer: My hon. Friend has said that the problems have been overcome, and he mentioned the Rampisham station in my constituency. I was shocked when I heard my hon. Friend the Member for Dorset, North (Mr. Baker) say that about 100,000 people lived in the area around Henstridge. That is not the case in Rampisham. Why should the BBC settle upon an area where there is not only a large population but growth potential? Why cannot the BBC go somewhere else
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  away from Dorset and set up the station on some blasted heath?
  Mr. Fox: My hon. Friend will be aware that the Department of the Environment often has to tread a careful path when planning. I cannot respond to his question. Perhaps if he listens carefully to my speech he will understand why I fail to respond.
  The meeting was attended by about 450 people. The proceedings were recorded by the BBC for broadcasting overseas to countries where people are not free to hold such public forums.
  I appreciate that there is bound to be disquiet at the prospect of having such tall structures planted in the midst of the Blackmore Vale. Although not designated as an area of outstanding natural beauty, the vale takes in an area of about 170,000 acres enclosed by hills including Bullbarrow, Mere, Shaftesbury and Hambledon. I remember the television programme to which my hon. Friend referred. The undulating landscape provides a fine setting for the scattered towns, villages and country houses, built for the most part of the golden Ham Hill stone. Agriculture and agricultural processes remain of considerable importance in the area. There is some manufacturing activity in the small towns. Yeovil, which is some 12 miles away, is the largest manufacturing centre and is dominated by Westland Aircraft. Only small population growth is expected in the area.
  I can understand that no one would wish to have an installation of this type almost in his own back garden, but I am equally appreciative of the difficulties facing the BBC in its legitimate search to maintain and improve the quality of the service that it provides.
  The Foreign and Commonwealth Office, whilst it would provide the finance for this proposal, has played no part in the selection of a site, which is entirely the BBC's responsibility. Its selection of Henstridge would have been based upon a series of technical criteria. The BBC has no powers of compulsory purchase and is thus required to go through all the normal planning processes that apply to any private citizen.
  I understand that the formal outline planning application was submitted by

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  the BBC to Yeovil district council and received by it on 24 September 1979. The district council is anxious to allow sufficient time for public consultation, so its planning committee is unlikely to consider the application before its meeting on 3 January 1980.
  Many of the representations received by my Department have urged that the Secretary of State for the Environment should immediately call in this planning application for his own decision. That is what my hon. Friend suggested. But as a Government we are committed to the encouragement of local democracy. This must include not only the full exercise of those powers available to local authorities but the assumption of their duties to the community that such a concept involves.
  We believe that local authorities should be left to perform the functions for which they have responsibility without the constant threat of intervention by central Government. In the field of development control, this means that local planning authorities are expected to face up to the sometimes difficult and unpalatable decisions that responsible planning of their area demands and not to pass the buck to the Department of the Environment. The mere fact that a particular proposal is of great local sensitivity is not, in our view, a reason for departing from the normal planning procedures.
  I should explain that any proposals for development of land which significantly depart from the provisions of the development plan for that area fall to be considered under the procedures laid down in the Town and Country Planning (Development Plans) Direction 1975. The majority of land in the vicinity of Henstridge airfield has been graded three or four on the scale used by the Ministry of Agriculture, Fisheries and Food. The site itself is mainly used for agriculture, although a small industrial estate has been established to the south, in north Dorset.
  In the county development plan for Somerset, which is still relevant for devel-
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  opment control purposes until there is a county structure plan, the site is shown as white land. White land is land where for the most part it is expected that the existing uses should remain unchanged. Thus, if the Yeovil district council is disposed to grant planning permission in this instance it will first need to refer the matter to the Somerset county council as a departure from the development plan. Should the county council itself be of the same mind, it in turn will have to submit the planning application to the Department of the Environment to give the Secretary of State the opportunity of deciding on the basis of the facts placed before him whether to call in the application for his own decision.
  In the event that either Yeovil district council or Somerset county council refused to grant planning permission, the BBC would have the right to appeal to the Secretary of State. This appeal could be dealt with by means of a local public inquiry at which all parties could state their case.
  In spite of my hon. Friend's request, for the reasons I have explained, I do not propose to call in this application, or to suggest that it should be called in, before the responsible local authorities have considered it. I am sure that hon. Members will appreciate that it would not be right for me to comment on the merits of the proposal in view of the possibility that the Secretary of State may later be required to decide the matter.
  I would advise anyone who has an interest in this proposal to make his views known without delay to Yeovil district council. If the proposal is eventually brought before the Secretary of State, all representations that have been made to my Department will certainly he taken fully into account. It is not within my responsibility to suggest to the BBC any action that it may take.
  Question put and agreed to.
  Adjourned accordingly at seven minutes to Twelve o'clock.