Commons Sitting of 25 January 1979

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

    Rhodesia (Refugees)
    Mr. Hooleyasked the Secretary of State for the Home Department how many refugees from Zimbabwe were granted permission to reside in the United Kingdom in 1977 and 1978 to date.
    The Minister of State, Home Office (Mr. Brynmor John): I regret that the information is not available in the form requested.
    Mr. Hooley: Can my hon. Friend give an assurance that Zimbabwean students who complete their courses in this country, and who would be in physical danger if required to return to Zimbabwe, may be given reasonable opportunity to seek employment whilst still in the United Kingdom so that they are not left in legal and social limbo?
    Mr. John: We are urgently considering that point and hope to be able to give an answer in the very near future.
    Mr. Ronald Bell: Will the Minister bear in mind that no student returning to Rhodesia after his studies here could possibly be in any danger other than from nationalist terrorists?
    Mr. Alexander W. Lyon: May I press my hon. Friend a little further on that matter? Already there are many Africans over here—some are students and some are here in other capacities—who find it extremely difficult to live and it is essential that if he takes a decision—
    Mr. Speaker: Order. The hon. Gentleman is making a statement. He must ask a question.
    Mr. Lyon: I thought that I began, Mr. Speaker, by asking whether I might press the Minister further.
    Mr. Speaker: That question was addressed to me.
    Mr. Lyon: I am sorry, Mr. Speaker. I know that all questions are addressed to you. May I ask whether the Minister will make a public statement so that the anxieties of these people can be alleviated?
    Mr. John: Yes, Sir, certainly. I hope to make this a public statement.
    Mr. Robert Hughes: Is my hon. Friend aware that an increasing number of refugees from Zimbabwe come here because they are in fear for their lives at the hands of the thugs of both the Rev. Ndabaningi Sithole and Bishop Abel Muzorewa? Will the Minister undertake to treat these applications for refugee status very favourably?
    Mr. John: What I can tell my hon. Friend is that no one in that category will be sent away without ministerial authority. I think that that guarantees a sympathetic consideration of each case.

    Parole Board Hearings
    Mr. Andrew F. Bennettasked the Secretary of State for the Home Department what provision allows a prisoner or his legal representative to ensure that any material relating to that prisoner presented to the Parole Board does not contain any factual errors.
    The Secretary of State for the Home Department (Mr. Merlyn Rees): There is no such provision. Much of the material comprises reports prepared on a confidential basis by, for example, members of the prison staff and probation officers. The basic facts are usually set out in a number of these reports as well as in the prison records and can be cross-checked. This is one of the functions of the parole unit in the Home Office.
    Mr. Bennett: Is my right hon. Friend aware that many prisoners whose parole is turned down are, first, very disappointed that it has been turned down, but are also concerned that they do not know the reason? Such prisoners fear that inaccurate information may well have been

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    entered on their records and have swung the decision as to whether parole should be refused or granted.
    Mr. Rees: Over the years I have checked on the matter of inaccuracy and only a handful of cases have come to light. I accept that they are only the ones that have come to light. We are conducting an experiment, the results of which are now being collated, to see whether we could give reasons for not granting parole. When the facts have been collated I shall report to the House.
    Mr. Grocott: Does my right hon. Friend agree that the decision whether or not to give parole can be almost as important to a prisoner as the original sentencing decision? Therefore, similar standards of evidence and natural justice should apply, the very least of these being that the prisoner should know the reasons for the decision.
    Mr. Rees: I have just said that that is why we have been conducting an experiment. One factor which should be the least worry, is the paperwork that would arise from what is suggested. I am looking at all aspects of the matter and I shall report to the House.
    Mr. Alan Clark: Does the Home Secretary agree that these matters would be more significant if any rational basis could be detected in a number of cases when the Parole Board comes to a decision? Does he agree that much of the feeling about unfairness among prisoners is caused by the extraordinary cases that the board seems to prefer over cases which prisoners themselves regard as being much more favourable?
    Mr. Rees: I invite the hon. Gentleman to see how the scheme is worked. I shall willingly show him. I think that what he says is misconceived.
    Mr. McNamara: Is my right hon. Friend aware that the cases he has considered must have included one concerning one of my constituents? When such errors occur, they create a great, deep and abiding sense of injustice not only for the prisoner but for his relatives and friends, if they feel that in one way or another evidence presented before the Parole Board is not accurate and in some cases is absolutely misleading.
    Mr. Rees: My hon. Friend has given one of the reasons why we are conducting the experiment of which I have spoken.

    Pornographic Material
    Mr. Andrew MacKayasked the Secretary of State for the Home Department if he is satisfied with the present laws relating to the display of pornographic material.
    Mr. John: The law in this field is under study as part of the wider review being undertaken by the committee on obscenity and film censorship under the chairmanship of Professor Bernard Williams, and the forthcoming debate on the Bill introduced by the hon. Member for Hornsey (Mr. Rossi) will also provide an opportunity to consider the matter in depth.
    Mr. MacKay: Is the Minister aware that there is such public concern about the increase in the display of indecent material in public that many hon. Members are now receiving considerable representations about it from their electors through the post? Secondly, is he aware that many of us have grave doubts about the composition of the Williams committee and particularly the balance of that committee?
    Mr. John: I am certainly aware that hon. Members are receiving letters on the subject. There is legislation—admittedly of nineteenth century vintage—against indecent advertisements. If electors or others feel that a breach of the law has been committed, they can report it to the police.
    I consider the hon. Gentleman's second point to be a quite unworthy attack on a committee which, after all, includes amongst its members a High Court judge. It is just the sort of snide attack that is likely to denigrate committees set up by the Government with the welcome of the Opposition and to prevent such committees from sitting in future.
    Mr. Edward Gardner: May I ask the Minister about the Indecent Displays (Control) Bill, which my hon. Friend the Member for Hornsey (Mr. Rossi) is introducing as a Private Member's Bill tomorrow? As the Bill has the limited and admirable objective of, to use the words

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    of the Explanatory Memorandum, safeguarding.
    "the public against being unwillingly exposed to indecent material",
    can the hon. Gentleman say whether the Bill will have the support of the Government?
    Mr. John: I do not consider Question Time the proper time to rehearse a debate that will take place tomrrow.
    Mr. Michael McNair-Wilson: When does the Minister expect Professor Williams's committee to report?
    Mr. John: The taking of evidence is almost complete and the report has been promised for later this year.
    Mr. Grocott: Does my hon. Friend agree that, while we should be concerned with protecting children in particular from seeing indecent displays, we should be far more concerned about the affects of violence on children? Is it not something of a statement of the hypocrisy of our society that, judging by the mailbag, there seems to be far more concern about ensuring that children do not see pornographic displays than there is about trying to prevent handicapped children in particular from being beaten in special schools and community homes?
    Mr. John: I understand and sympathise with my hon. Friend's depth of feeling at having Second Reading of his Bill on that subject objected to last Friday afternoon. The Government are certainly opposed to the foisting of indecent displays upon the unwilling public. The problem which affects us, and which affected the last Conservative Government, is whether the measure propounded gets to the root of the evil.

    Shoplifting (Self-service Stores)
    Mr. Adleyasked the Secretary of State for the Home Department if he is satisfied that self-service stores take adequate steps to discourage shoplifting; and what steps he intends to take to persuade them to implement his Department's recommendations in this regard.
    The Under-Secretary of State for the Home Department (Dr. Shirley Summerskill): I am sure that many self-service and other stores can improve their arrangements for preventing shoplifting.
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    Together with the police we continue to encourage retailers to implement the relevant recommendations of the report "Shoplifting and Thefts by Shop Staff" which was first published in 1973.
    Mr. Adley: I thank the Minister for that reply, but is she aware that pilferage by staff is now far higher than theft by customers, and that that will continue in line with the number of self-service stores that open? Is it not about time we in the House recognised that stores which invite the public to help themselves, and thereafter call on society to pay the cost of court and police time, should be encouraged at the very least to bring in the preventive measures about which the hon. Lady has spoken?
    Dr. Summerskill: Everything possible is being done by the Home Office, and, I know, by the hon. Gentleman, to encourage retailers to take preventive measures. I am sure that they are aware that many recommendations have been made, which they could carry out.
    Mr. Sainsbury: Will the Minister accept that there is no evidence to show that staff pilferage is more widespread than customer pilferage? Does she agree that the regrettable incidence of staff pilferage is by no means confined to self-service stores, and occurs in all forms of retail outlet?
    Dr. Summerskill: Whether it is staff or customer pilferage, it is still very serious and should be stopped.
    Mr. Skinner: Will my hon. Friend also agree that shoplifting occurs right across all social classes? Will she draw up a list of the ratios and percentages of shoplifting in the various socio-economic groups, so that we can be absolutely sure where the greatest number come from?
    Dr. Summerskill: I think that the investigation suggested by my hon. Friend would be of no purpose, except perhaps to give him some satisfaction. I do not think that crime knows any class barriers or boundaries.
    Mr. George Rodgers: Is my hon Friend satisfied that the laws, such as they are, that apply to price control at self-service shops have been sufficiently implemented during recent shortages?
    Dr. Summerskill: That appears to be another question. Perhaps my hon. Friend will put down a question to my right hon. Friend the Secretary of State for Prices and Consumer Protection.

    Broadcasting (Complaints Procedure)
    Mr. McCrindleasked the Secretary of State for the Home Department if he is satisfied with the complaints procedure in relation to broadcasting.
    Dr. Summerskill: The White Paper on broadcasting makes it clear that we have proposed the establishment of a single independent broadcasting complaints commission.
    Mr. McCrindle: As neither the BBC's nor the IBA's present complaints machinery appears to have the confidence of the public, will the hon. Lady confirm that any proposed complaints commission would be entitled to look into claims of unfairness or misrepresentation during a radio or television programme, and that it would be the intention, as with Press Council, to require the BBC or the IBA to publish the findings of that commission?
    Dr. Summerskill: The Annan committee recommended, and the Government agree, that the commission should be able to receive, consider and adjudicate on, complaints of unfairness, misrepresentation and invasion of privacy. I can give no positive undertaking on the hon. Gentleman's second point, but it is being considered.
    Mr. Hoyle: Will my hon. Friend seek an interview with the Director-General of the BBC, Mr. Ian Trethowan, about the letter from the British Field Sports Society, and make a complaint to him about what it says—that they guaranteed media time to someone on the matter of blood sports? Surely, to guarantee sectional interest time is not the right way to run the BBC?
    Dr. Summerskill: I think that I am right in saying that that has been denied by Mr. Trethowan, but if my hon. Friend will write to me—
    Mr. Hoyle: I shall.
    Dr. Summerskill:—and specify his exact complaint. I shall certainly have it
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    considered by my noble Friend the Minister of State or my right hon. Friend the Secretary of State.
    Mr. Neubert: Has the hon. Lady read the recent article in The Daily Telegraph by her former ministerial colleague Lord Harris, condemning the unfair aspersions on the police in many television programmes? Does she intend to take any action on that?
    Dr. Summerskill: If the hon. Gentleman cares to bring the issue to my notice or to the notice of the brodacasting authority, in writing, it will be taken up. The whole point of the new complaints commission is to give more strength and teeth to the type of complaint that the hon. Gentleman has made.
    Mr. Terry Walker: Will the new complaints procedure allow for complaints about bad television and broadcasting reception? Despite all the matters that have been raised in the House, we do not seem to be able to overcome the problem. It is a legitimate complaint in many places, especially in my constituency.
    Dr. Summerskill: Reception complaints are not specifically included in the plans for the commission. I realise that there is a good deal of feeling about reception. That is being considered by the Home Office in a completely different context and not under the complaints commission.

    Firearms Offences
    Mr. Goodhartasked the Secretary of State for the Home Department how many offences involving the use of firearms were committed within the Metropolitan Police area in 1958, 1968 and 1978.
    Mr. Merlyn Rees: In 1969, the earliest year for which comparable figures are available, 483 indictable offences in which firearms were reported to have been used were recorded in the Metropolitan Police district. In 1977, the corresponding figure was 1,526. The figure for 1978 is not yet available.
    Mr. Goodhart: Is the right hon. Gentleman aware that 20 years ago, or even 10 years ago, hardly any professional criminals carried firearms, but that last year firearms were carried in 80 per cent. of the attacks on banks, betting shops and

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    security guards? Does he think that the total abolition of the death penalty has been a major cause of that regrettable occurrence?
    Mr. Rees: No, I do not think that that is so. There are many causes of that in our society. I do not think that the abolition of the death penalty is the reason.
    Mr. Townsend: Will the right hon. Gentleman confirm that the shotgun is now the preferred weapon of the serious criminal in many of the metropolises? Will he confirm also that current firearms control legislation is totally inadequate, and that, if it had not been for the Lib-Lab pact, the Government would have already taken steps?
    Mr. Rees: Shotguns are an important element. Heavy penalties up to life imprisonment are available on the statute book for armed crime.
    Mr. Farr: Does the right hon. Gentleman agree that in recent years the classification of offences has changed, which has resulted in offences not formerly regarded as serious matters now being regarded as serious, and that the figures that he has given should be interpreted in that light?
    Mr. Rees: Whatever the interpretation of figures, the Commissioner tells me that there is a growth of armed crime in the metropolis and throughout the country as a whole.

    Mobile Radio Licences
    Mr. Newtonasked the Secretary of State for the Home Department what progress has been made in reducing delays in dealing with applications for private mobile radio licences.
    Dr. Summerskill: In recent weeks there has been a speeding up in the frequency assignment procedure, which is an essential part of the processing of applications for private mobile radio licences. Previously, a series of technical difficulties with the computer which performs frequency assignments had resulted in a backlog. Some applications remain to be cleared, but every effort is being made to deal with them as quickly as possible.
    Mr. Newton: May I tell the hon. Lady that we sympathise with her difficulties
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    over a computer? Since the tabling of the question before Christmas my constituent who was involved has told me, too, that there has been some improvement. May I ask the hon. Lady to do everything possible to ensure that pressure for the improvement is maintained?
    Dr. Summerskill: I thank the hon, Gentleman. I can assure him that everything is being done.
    Mr. Robert HughesHow quickly does my hon. Friend now expect licences to be processed?
    Dr. Summerskill: Every month we are receiving about 200 to 250 applications for licences or major variations to existing licences. If it is a straightforward matter, it should in normal circumstances be proceeded to the stage of frequency assignment in three to four weeks.

    Police Officers (Protection)
    Mr. Shepherdasked the Secretary of State for the Home Department if he is satisfied that there is sufficient legislation to protect properly the lives of police officers while in execution of their duties.
    Mr. Merlyn Rees: Yes, Sir.
    Mr. Shepherd: Does the right hon. Gentleman recollect that shortly before Christmas there were two especially ugly incidents when police officers were confronted with sawn-off shotguns? Is it not apparent that heavy fines and sentences up to and including life imprisonment are not sufficient? Is there not a case for the reintroduction of capital punishment for such offences as a deterrent? What representations is he receiving from the police force on the subject?
    Mr. Rees: I cannot recall receiving any such representations recently, but I have no doubt that it is the view of the force that the penalty of capital punishment should be brought back. I shall not call in aid the figures. If one policeman were killed, that would be one too many. Under controlled circumstances police are now armed. I offer that as a fact. That is happening under very controlled circumstances and it is a factor.
    Mr. Emery: Has the right hon. Gentleman discussed with the Commissioner of Police of the Metropolis the fact that he

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    is having to mount guards in a number of places around central London—police officers wearing flak jackets and being armed—to cope with the possibility of problems arising of an international nature? Surely there is something wrong when we have to have police around the capital wearing flak jackets and being armed. That is the type of action that we have never had in the United Kingdom. We want to protect the police, but we do not want the type of action to which I have referred.
    Mr. Rees: I am not sure on what basis the hon. Gentleman makes that statement. There are people in the metropolis who are protected by armed guards. There are occasions when selected policemen, who are trained properly and wear flak jackets, are put in certain areas. Given the international situation, it is right that that should be so. We cannot opt out, and I support what the commissioner does.

    Commissioner of Police of the Metropolis
    Mr. Brothertonasked the Secretary of State for the Home Department when he expects to meet the Commissioner of Police of the Metropolis.
    Mr. Neubertasked the Secretary of State for the Home Department when he expects to meet the Commissioner of Police of the Metropolis.
    Mr. Merlyn Rees: I met him earlier this week and I expect to meet him again soon.
    Mr. Brotherton: During the meetings with the Commissioner, has the right hon. Gentleman discussed the Commissioner's proposed changes in the powers of the police? Will he tell the House his views on the subject?
    Mr. Rees: No. There is a Royal Commission sitting and everybody concerned may give evidence on what he thinks should be the changes. I shall wait until the Royal Commission reports. I hoped to meet the members of the commission last week, but I was busier in another context. I had hoped to meet them on Saturday, but I could not go. I shall wait until the Commission reports and all the evidence is collated.
    Mr. Neubert: When the right hon. Gentleman meets the Commissioner, will he discuss with him the serious matter of assaults on London taxi drivers and the growing incidence of bilking? Does he think that there is sufficient publicity of the provisions of the Theft Act? Why should not the penalties be displayed in the cabs?
    Mr. Rees: I shall certainly do what the hon. Gentleman asks. I shall discuss the matter with the Commissioner.
    Mr. Pavitt: When my right hon. Friend meets the Commissioner, will he thank him and commend him for the appointment of public relations officers, especially in areas such as mine that have large ethnic minorities? These officers are able to save a considerable amount of complaint procedure that would involve considerable time and effort by hard-pressed police officers.
    Mr. Rees: I shall do that.
    Mr. Townsend: Will the right hon. Gentleman draw the attention of the Commissioner to the great concern in many London riverside boroughs about the cutting back of the Metropolitan Police River Division? Does he appreciate that in many respects river traffic has increased in recent years?
    Mr. Rees: River traffic may have increased, but the nature and the use of the river has changed greatly. The Commissioner must make his own operational judgment and I support him in what he is doing.
    Mr. Whitelaw: When the right hon. Gentleman next meets the Commissioner, will he first express the appreciation of the House for the way in which the Metropolitan Police handled the large demonstrations that took place on Monday? At the same time will he express the understanding the House of the many extra duties places on the police at a time of industrial difficulty such as at present?
    Mr. Rees: I shall do that. When I first heard the discussions in the House I thought that hon. Members were complaining about what the police were doing. I explained to the police that parliamentary procedure is sometimes peculiar and that we meant that we were praising them.

    Police Recruitment
    Mr. Michael McNair-Wilsonasked the Secretary of State for the Home Department if he is satisfied with current recruitment to the police force.
    Mr. Simsasked the Secretary of State for the Home Department what has been the net increase to the latest available date in the strength of the Metropolitan Police since he announced the implementation of half the wage increases recommended by the Edmund-Davies committee.
    Mr. Merlyn Rees: I am pleased to say that provisional figures show that for the period 1 July to 31 December 1978 the total strength of the police service in England and Wales increased by 1,267 to 109,066. This includes a net increase of 330 by the Metropolitan Police, bringing the force strength to 21,961.
    Mr. McNair-Wilson: That is a modest but to be welcomed improvement. Will the right hon. Gentleman say what thought he has given to asking police authorities generally to reassess their establishment strengths to reach figures that would meet the increased rise in crime?
    Mr. Rees: I am glad that the hon. Gentleman gives a modest word of thanks. One cannot win in this place. If recruitment is falling it is bad, and when it is increasing it is "modest". I leave establishments entirely to the Inspectorate, which is composed of professional policemen working in the Home Office. They go around the country and discuss with the local police authority, or the chief constable, what the establishment should be. I think that I ought to leave it to them.
    Mr. Sims: Does not the right hon. Gentleman agree that the figures conceal the fact that a large number of experienced officers are being lost to the force and are being replaced by new recruits? Does not he think that, had he accepted the recommendation of the Edmund-Davies report completely, and implemented them in full, this drain would not have occurred?
    Mr. Rees: I think that the hon. Gentleman is wrong, because my information is that wastage has dropped by over 30 per
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    cent. in the second half of 1978. A full analysis is not available, but it is quite clear that a substantial drop is caused by a deferment of retirement. Because there is a deferment of retirement, where people are waiting for their enhanced pensions which will take effect next September, because pensions were treated on the full rate, I must warn the House that there will be a problem in September since retirements will then take place.
    Mrs. Dunwoody: Will not my right hon. Friend encourage the police to look at their management techniques? Giving the police decent pay is very imimportant, but if they continue to use management techniques, particularly in relation to graduates, which are not acceptable to modern industrial relations, there will be considerable difficulty irrespective of the amount of money.
    Mr. Rees: There are two aspects to my hon. Friend's question. The question whether one uses graduates is a separate issue. What the police have tended to do is to send to university policemen who, in the main, come back. The police are giving a lot of thought to management. As a result of the greatly enhanced salaries, the police are now paid very well indeed. Therefore, police authorities—certainly I as police authority in the Metropolitan district—tend to use men in a better way because they cost more money.
    Mr. Eldon Griffiths: Does the Home Secretary recall that the Edmund-Davies settlement was based on giving the police a substantial, immediate increase and an inflation-indexed review machinery to see that they did not fall behind again? Does he also recognise that that was based on two things—first, that the police are a vital service and, secondly, that they do not have the right to strike? Does not he think that the time has come to apply those same principles to other vital life-support services, for example, in the hospitals, in the fire service and—
    Mr. Speaker: Order. That goes far beyond the question on the Order Paper.
    Mr. Edward Lyons: Is my right hon. Friend aware that at a Press Gallery luncheon yesterday the Commissioner of Police of the Metropolis expressed some satisfaction with the increase in police

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    recruitment? Does he not agree that it would be a bad thing for the police to have the return of a Tory Government and a far lower level in police numbers? Is it not a matter of great satisfaction to the police that, taking into account his free allowances and London weighting, a police sergeant in London now has a salary substantially more than Members of Parliament?
    Mr. Rees: What I am prepared to do is to take all the praise for putting up police pay.

    Jurors
    Mr. Cryerasked the Secretary of State for the Home Department if he will examine the jury review arrangements which were set out by the then Secretary of State in 1975.
    Mr. John: No, Sir. We are satisfied with the present arrangements for the checking of potential jurors. These were agreed by my right hon. Friend's predecessor in 1975, and have since been set out in the statement of 10 October 1978 issued by my right hon. and learned Friend the Attorney-General, a copy of which has been placed in the Library of the House.
    Mr. Cryer: Does not my hon. Friend agree that the guidelines in that statement, which was wrung out of an unwilling Establishment during the A, B, C trial, represent a diminution in the right of trial by jury and an interference by the secret police with the juries, which is not equally available to both prosecution and defence? Does he not accept that removal of the guidelines and this interference would be a far better option for the Home Office and the Secretary of State to take up? At least it would improve the reputation of the Home Office and its concern for justice, which is what we are all concerned about.
    Mr. John: The Home Office is not solely responsible for this whole problem. Guidelines have existed for a number of years. So far as I can trace, they have existed since 1948. They were not introduced for the A, B, C trial. The check is to see whether a juror may be susceptible to improper pressure, or is unduly biased against either the prosecution or the defence. When the prosecution believes that a juror is unduly biased, it
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    may use its power to stand down that juror. But when it believes that he is unduly biased against the defence, it is its duty to communicate that fact to the defence so that the defence may use its right of peremptory challenge.
    Mr. Alexander W. Lyon: If the principles which my hon. Friend has just enunciated are logical, they ought to apply to all kinds of jury cases. If they do not, they ought not to apply to the group outlined in the Attorney-General's statement. Is not it right that we either go over to the American system or keep random selection and should not mess about with it?
    Mr. John: There are some very serious crimes where the stakes are so high that it is right to select those outside the normal run.
    Mr. McNamara: Does not my hon. Friend agree that it is in precisely those cases where the stakes are so very high that justice must be seen to be done? If we are to interfere with the principle of random selection of jurors, we must have a clear and direct code. This must not be left to the discretion of the prosecution, as it is in these cases, or as sometimes happens, to the discretion of the judge trying the case. Does not my hon. Friend agree that this must be clear, obvious and straightforward? But basically, we should go back to random selection.
    Mr. John: The actual inquiries are left to the authority of the Director of Public Prosecutions, or his deputy, and notification of my right hon. Friend the Attorney-General. But the point that I am making is that, when facts are revealed which suggest that a juror may be biased against the defence, those facts must be communicated to the defence so that it may exercise its right of random challenge.

    Official Secrets Act
    Mr. Litterickasked the Secretary of State for the Home Department what representations he has received on the White Paper on the reform of the Official Secrets Act.
    Mr. Rookerasked the Secretary of State for the Home Department what representations he has received on the

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    White Paper on the reform of the Official Secrets Act.
    Mr. Christopher Priceasked the Secretary of State for the Home Department how many letters he has received in response to the White Paper on the Official Secrets Act.
    Mr. Merlyn Rees: I have received 23 representations, including 15 letters, explicitly in response to the White Paper. Eleven were from hon. Members, four from private individuals, and eight from organisations, including three local Labour Party bodies. I have also received other representations on the matters covered by the White Paper, but it is not clear that they were in direct response to it.
    Mr. Litterick: I am grateful for that answer. Does my right hon. Friend agree that the House last Friday demonstrated that there is a wide measure of agreement that the Official Secrets Act must be reformed radically and soon? Will he give the House some assurance that in Committee his Department will not play ducks and drakes with the Bill of the hon. Member for Isle of Ely (Mr. Freud) in defence of an existing law which has now been brought into disrepute?
    Mr. Rees: My hon. Friend referred specifically to a reform of the Official Secrets Act. I should like to reform that very quickly. I have no intention of playing ducks and drakes with it. Indeed, with regard to a Private Member's Bill, perhaps I should ask those hon. Members of the Committee not to play ducks and drakes with us.
    Mr. Corbett: Can I encourage my right hon. Friend to be a little more generous as to the assistance which he can give to this Private Member's Bill? Will he say that he will welcome some legislation, however narrow, with regard to the right to information?
    Mr. Rees: I think that we must look at the question of access. We shall be discussing this in Committee. There are undoubtedly things to which the general public could have access without any problem at all. But what was quite clear from last week's debate was that there are things which are subject to the current Official Secrets Act, this applies to the American and Swedish legislation, too—
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    about which there can be no question of giving access.

    Juvenile Courts
    Mr. Temple-Morrisasked the Secretary of State for the Home Department if he is satisfied with the present powers of juvenile courts.
    Mr. John: Yes. These powers were strengthened by the Criminal Law Act 1977, and we are satisfied that they are adequate.
    Mr. Temple-Morris: Is the Minister sufficiently aware of the simple fact that there are no courts in this country which inspire less apprehension among their customers and potential customers than the juvenile courts? Is he aware also that this situation will not be remedied until there is some power of custodial sentencing? In addition to custodial sentencing, there must be the power to set some sort of custodial alternatives to fines. At the moment juvenile courts are quite impotent in that simple area.
    Mr. John: I believe that at that age it is not right to inspire fear. This does not necessarily give adequate results. I believe that the ability to deal flexibly, sensibly and adequately with people who appear before the court is a much better weapon.
    Mr. Sims: Is the Minister aware that, if the juvenile court wants to send a child to a junior detention centre, and if that court carries out the wishes of the Home Office, it must make inquiries about availability? Quite often it finds that no places are available. Is the Minister satisfied that there is sufficient accommodation available?
    Mr. John: Yes.
    Mr. Edward Gardner: Will the Minister bear in mind the firm views of magistrates who have to deal with juvenile offenders? They feel that they need, and should be given as a matter of urgency, new powers to deal with persistent juvenile offenders. Is he aware that without these powers magistrates feel that they cannot possibly be expected to meet the rising tide of juvenile crime?
    Mr. John: Over recent years there have been decreasing numbers of juvenile crimes. The hon. and learned Gentleman's primary error is that he is thinking

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    of magistrates as having to deal only with juveniles. Under any system, the local authorities have a very great part to play in the disposition of juvenile offenders. They and the magistrates together have to work on a code of conduct which, while it does not wholly satisfy the Magistrates Association, does go a long way to resolving these positions. If the hon. and learned Gentleman paid more attention to encouraging these positive contributions instead of constantly carping about the rising tide of crime and the inadequacy of society to deal with it he would be doing the House a greater service.
    Mr. Edward Lyons: Is it not pointless to ask for extra flowers for the juvenile courts when there is virtually no accommodation in which to put juveniles? Surely these questions are meaningless? They approach the problem from the wrong angle.
    Mr. John: Under the Children and Young Persons Act, those who have to deal with the future of young offenders so that they will not offend again should have the say in where the disposition occurs. If the magistrates were to be given a concurrent power with the local authorities it would divide responsibility and add to confusion.

    Illegal Entry and Overstaying
    Mr. Budgenasked the Secretary of State for the Home Department if he has any proposals for introducing internal checks in order to prevent illegal immigration and illegal overstaying in this country.
    Mr. John: A variety of measures are already taken to prevent and detect illegal entry and overstaying, which are continually reviewed and improved in the light of experience and the available resources. However, for the reasons set out in my right hon. Friend's statement of 6 April 1978, the Government are opposed to a system of internal control of immigration.
    Mr. Budgen: Will the Minister of State now confirm that the Government have decided to reject each of the four specific recommendations made nearly a year ago by the Select Committee on Race Relations
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    and Immigration, in order to control illegal immigration and overstaying?
    Mr. John: Since the Home Secretary has made a statement and we have subsequently published a White Paper, I do not know why the hon. Gentleman should be seeking confirmation. If he had read his parliamentary papers he would already know the Government's attitude.
    Mrs. Dunwoody: Will my hon. Friend make it quite clear to the EEC that he finds the undertakings in its new directive unacceptable, because the evidence given by immigration organisations to this House makes it clear that they would not accept internal checks?
    Mr. John: I attended the EEC Council meeting last November. The proposal is now that the Commission should hold separate discussions with the United Kingdom about the difficulties that the draft holds for us. I have made it clear that the draft directive does hold considerable problems for this country.
    Mr. Onslow: What action does the Home Office take when it is brought to its notice that someone is making money out of illegal immigration? What is the success rate?
    Mr. John: The success rate is considerable and such people are liable to criminal prosecution.
    Mr. Alexander W. Lyon: Has my hon. Friend followed the questioning of the Select Committee in its present inquiry in which time after time it has said that it denies ever making the recommendation which the hon. Member for Wolverhampton, South-West (Mr. Budgen) has suggested?
    Mr. John: I understand that. Our difficulty at the time when the Home Secretary made the statement was in understanding what the Select Committee did mean.

    TUC
    Mr. Corbettasked the Prime Minister when he last met the TUC.
    The Prime Minister (Mr. James Callaghan): I meet representatives of the TUC from time to time at NEDC and on other occasions. Further meetings will be arranged as necessary.
    Mr. Corbett: Will the Prime Minister confirm with the TUC and the CBI that there is no evidence that secret ballots result in fewer decisions to strike? Is it not a fact that the reverse is often the case? Does he agree with the Donovan Commission report of 1968 that the better way to proceed is to extend individual involvement and responsibility for industrial democracy at the work place?
    The Prime Minister: It is the case that some unions already have ballots for strike action. I suppose the most prominent example is the National Union of Mineworkers. It can be argued that a ballot may lead to a more accurate result of the feelings of those concerned, but it does not necessarily lead, as the miner's ballots show, to greater industrial peace, which is what the House is particularly concerned about at present. Certainly we would be ready to discuss these matters with the TUC and the CBI and to facilitate them if it seems likely to help.
    On industrial democracy, this country is not in the forefront in involving workers in the operation of their own works and plants. We have room to move on industrial democracy, which is a shorthand term for this, and we should undoubtedly aim to achieve that.
    Mrs. Thatcher: As it is now a fortnight since the Prime Minister returned from the Caribbean, no one could accuse him of taking precipitate action. Therefore, how much more damage must be done to industry, how many more jobs must be in jeopardy, and how many more hospital patients must suffer before the Prime Minister decides to act?
    The Prime Minister: As the right hon. Lady knows, action is being taken on a great many fronts in trying to settle some of these disputes. However, in the case of the road hauliers' dispute the Government have no standing as this is an example of free collective bargaining between employers and workers which the right hon. Lady has now espoused. We have seen the consequences of this in the dislocation caused in the country. On the maintenance of essential supplies, the regular reports that are being given by Ministers to this House every day have shown that the Government, through various means, but not necessarily through declaring a statse of emergency,
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    are ensuring the flow of those supplies. Although there are difficulties in a number of areas, basically supplies are being maintained.
    Mrs. Thatcher: Is the Prime Minister aware that what he says is very complacent? Many raw materials are not getting through to the factories and many exports are not getting away. Is he not aware that the Government have a duty to enable supplies to be kept coming and going to and from the factories and they have full parliamentary authority to do that? Why have the Government not made use of that authority? Is it a fact that the Prime Minister no longer has the courage to act and, if that is so, will he not at least have the courage to resign?
    The Prime Minister: I somehow thought that was behind the right hon. Lady's real desires. She just cannot wait. There are plenty of statutory powers, but I do not know that any Government have sufficient power when the road haulage industry goes on strike to replace it. That is the simple truth of the matter. That is why the Government are using good sense to try to ensure that essential supplies are kept going. The right hon. Lady, of course, has a solution. If the claim is conceded in full, there is no doubt that the men will go back to work and, equally, there is no doubt that we would be in for another round of inflation. That is the dilemma which the right hon. Lady will never face.
    Mr. Steel: When the Prime Minister next meets the TUC, will he ask if it now realises that it would be in the interests of the greater number of its members, especially those who are the lowest paid and those who settle within the 5 per cent. guidelines, to accept that the Government should themselves intervene directly on the pay front?
    The Prime Minister: The Government do intervene directly on the pay front in relation to all public sector and public service workers, who account for about 30 per cent. of the total. One of the problems at the moment is that settlements in the private sector, under present free collective bargaining, are feeding through into the public sector. If carried through, they would have very serious consequences for our total revenue and budgetary expenditure. These are long-term

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    problems. I believe that the present dispute, if it focuses the attention of the TUC, as well as the Government and others, on these matters, will show that it is usually out of a crisis that we begin to get some solution in this country. I hope we shall do so on this occasion.
    Mr. Weetch: When my right hon. Friend meets the TUC, will he tell it that increased levels of import penetration are due to the fact that some sections of British industry are highly uncompetitive and that wage increases above and beyond what industry can bear will make the system more uncompetitive with a further loss of jobs?
    The Prime Minister: Yes, Sir. The TUC is aware of this, as is the CBI. It is important that both should operate on this matter. Hence the importance of the industrial strategy under which we are able to communicate at plant level and sector level with all those concerned to point out the importance of additional investment, up-to-date design, good quality and proper deliveries. Both sides of industry have a full part to play in all these matters.
    Mr. Rost: As the Prime Minister has advised people to cross picket lines, why does he not take his own advice and go through the picket line at one of the ports or factories that are being blockaded and get the country moving again?
    The Prime Minister: I do not think that gestures are the best way in which to handle these matters. I have stated the law as I understand it, and the Attorney-General will be making a further statement on the law, in response to the request by the Opposition, after questions. There is no reason to alter the view that I have expressed.
    Mr. Terry Walkerasked the Prime Minister, when he last met the TUC.
    The Prime Minister: I refer my hon. Friend to the repely which I have just given to my hon. Friend, the Member for Hemel Hempstead (Mr. Corbett).
    Mr. Walker: Will my right hon. Friend meet the General Council of the TUC as a matter of urgency and try to come to an agreement with it about future policy and the way in which we can overcome the present industrial situation? Will he make clear to the general council that the
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    Labour Government are the only ones who can overcome the present problem by agreement with the trade unions? Will he make clear to the trade unions that due to the way in which they have co-operated with us over the last three years, and mainly due to their efforts, we have been able to keep down the rate of inflation? Will he also make clear that the policy of confrontation coming from the Opposition makes it impossible for the Conservative Party to work with the trade union movement at all?
    The Prime Minister: I hope to meet the general council of the TUC on Monday. I shall point out the dislocation that is occurring in the country as a result of the present position on ay claims and pay settlements in which negotiations seem to be preceded, on occasions, by strikes and in which, contrary to the view often expressed by certain hon. Members in this House, trade unions do not seem to have sufficient control over their own members. It is a salutary reminder to hon. Members in this House that it is not the leaders of the unions who are failing in their attempt to try to co-operate. It is groups of independent minded subjects of this country who are acting on their own. I would have thought that the Opposition at least might have some lessons to learn from that.
    Mr. Henderson: Looking ahead of the present dispute to what might be coming, will the Prime Minister give the House an indication of how damaging could be a strike by Government computer operators?
    The Prime Minister: I could not do so in reply to that supplementary question. But there is no doubt, as I have said at this Dispatch Box on many occasions, that our society is now so complex that an increasing number of relatively small groups of people can say to the country "We are going to hold up your operation." That is why we should examine all proposals, such as those for taking particular groups out of the strike area, if that is possible. None of us should be dogmatic, although when they were removed originally it was because it was thought that this had no particular value. We should examine all these matters, but, basically, the question is what kind of society we want in this country. This is a totally acquisitive society, and some

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    people are now practising what the Opposition preaches.
    Mr. Tebbit: Is not the Prime Minister's problem over the road hauliers' strike made more difficult by the fact that the Transport and General Workers' Union holds 2 million votes at his party conference—[HON. MEMBERS: "One million."] All right, a million. The union is a prime contributor to his party's funds. It controls the nomination of more than a score of his party's Members in this House. Does he find that this inhibits him in saying whether he wants the Transport and General Workers' Union to be defeated in this strike and for the employers to get their men back at the present offer?
    The Prime Minister: The hon. Gentlemen's question was well up to his usual standard. As was rather noisily pointed out to him, he is only 100 per cent. wrong on the number of votes—not that that, if I may say so, is significant, because the Government of this country will carry out their responsibilities—[HON. MEMBERS: "When?"]—irrespective of their affiliations to any particular group. I believe that would be true of the Conservative Party in relation to the many contributors to its party funds, just as it is true in relation to ours.
    Mr. Mellish: Again and again, the Leader of the Opposition claims that simple Government intervention is a panacea and would solve all these problems. Many people outside this House believe that. Will my right hon. Friend make it clear that, while the Government are prepared to intervene when they think that it is absolutely necessary, the most dangerous and terrifying result of Government intervention is that the position would get worse?
    The Prime Minister: There are insufficient vehicles at the disposal of the Government and, indeed, people to drive them, especially because of the complicated loads that exist today. Those hon. Members who shout loudly should examine this problem a little more and see what the difficulties are.
    The Government are approaching this matter in a way which is keeping the flow of supplies moving. We shall continue to do that. If there should be a real crisis, of course the country would
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    be far worse off than it is today. I hope that the dispute is settled soon on a basis that will not give rise to further inflation. Perhaps the Opposition will make their position clear on that.
    The longer the dispute goes on, the more certain I am that it would have been totally wrong—and a gesture—to have declared a state of emergency: it would have made things much worse. I beg hon. Members to believe that that is a judgment which is borne out by nearly everybody who has had anything to do with the dispute.
    Mr. Pardoe: Does the Prime Minister accept that if this is an acquisitive society we are making a pretty poor job of it? Even East Germany and Czechoslovakia have now overtaken us in terms of income per head.
    Will the Prime Minister tell the TUC that the only alternative to an acquisitive society is a rational incomes policy and that that must be enforced either by the TUC or the Government? Will he tell the TUC that, if it will not enforce an incomes policy, or cannot do so, the Government must do so now with a wage freeze in order to escape astronomical rates of inflation?
    The Prime Minister: I take the hon. Member's point. We have been through these proposals on many occasions before. We have been through wage freezes and the rest. I cannot say that they ever form a universal panacea. I hope that Opposition Members below and above the Gangway, if they should ever come to power, will take into account that they will find it essential to work closely with the trade unions and the TUC. I beg of them, if they hope for a chance of doing that, to restrain some of their more absurd criticisms.
    Mrs. Kellett-Bowman: On a point of order, Mr. Speaker. I call attention to the fact that unfortunately you were unable to call any hon. Member for the North-West. Many of us wished to raise with the Prime Minister the serious state of the water supply in the North-West which is becoming worse every day.
    Mr. Speaker: The hon. Lady cannot ask a question now. I am sorry that I did not call an hon. Member from the North-West. Almost every part of the country has its own problems.
    Mr. Evelyn King: On a point of order, Mr. Speaker. Might I ask you, with due respect, having regard to the enormous number of hon. Members who wish to be called from all districts and for a variety of reasons, whether it is entirely reasonable for you to call two members of the Liberal Party?
    Mr. Speaker: One of the prime duties of the Speaker is to try to the best of his ability to guard minority rights while bearing in mind majority rights. I try to achieve a balance.
    Later—
    Mr. Noble: On a point of order, Mr. Speaker. At the end of Questions to the Prime Minister, the hon. Member for Lancaster (Mrs. Kellett-Bowman) sought to raise a point of order and implied that water supplies in her constituency were in jeopardy. I understand that the hon. Lady has been given the same information as I have by the chairman of the water authority, which is that the water supply situation in Lancaster is perfectly normal.
    As the proceedings of this House were still being broadcast at that time and many listeners in Lancaster will have heard the hon. Lady, should not the hon. Lady withdraw her statement?
    Mrs. Kellett-Bowman: Further to that point of order, Mr. Speaker. I sought to raise the overall position of the North-West water authority. I was in touch with the chairman of the authority shortly after one o'clock. The point that I wished to raise with the Prime Minister was that the Pennine division went back on Monday after 10 days, but that it will be a week before it gets into order, that the Ribble—
    Mr. Speaker: Order. We cannot go into this matter now. The hon. Lady has made her position quite clear. She has been in touch with the water authority this morning. I think that clears that matter.

QUEEN ELIZABETH HOSPITAL, BIRMINGHAM
Mrs. Knight(by private notice) asked the Secretary of State for Social Services what action he proposes to take to alleviate the situation at the Queen Elizabeth hospital in Birmingham because of the threat of the imminent closure of that hospital; and if he will make a statement.
The Secretary of State for Social Services (Mr. David Ennals): There is no question of this hospital being closed. Yesterday, because of concern about the supply situation, it was decided at the hospital to reduce the number of inpatients. About 100 of the 500 patients were discharged. The decisions about the discharge of patients were taken by individual consultants on their assessment of the relative medical needs.
The area medical officer, Dr. Nichol, was at the hospital this morning to assess the situation. At a meeting between the health authorities and the union officials, a list of essential supplies was agreed. The union has given instructions to its members that these supplies shall not be obstructed. I hope that this will ease the situation and I have called for a full report.
There is no escaping—as I have made clear to the House on many occasions—that any industrial action in the Health Service is liable to harm patients.
Even if workers at the Queen Elizabeth hospital had not gone beyond the union's instructions, services would have been affected. For example, many patients have had their admissions postponed. This must affect the health of some patients and this is a fact which must be faced by all those taking industrial action in the Health Service.
Mrs. Knight: Is the Secretary of State aware that the information that he has received does not altogether add up to that which has been made available to other hon. Members about the danger of the hospital being closed? Will he keep a close eye on the situation?
Is the Secretary of State aware that pickets are not only stopping food and essential medical equipment from entering the hospital but are taking upon themselves the task of judging which patients

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shall be allowed to have treatment and which shall not? Is he further aware of the case yesterday of a dying man who was held up for 20 minutes by the pickets? When he finally entered the hospital he was immediately taken to the operating theatre. It is not yet known whether that man will live.
Is the Minister aware, finally, that some patients are being sent home to cold homes with nobody to care for them? Does he agree that that is serious? Does he recognise that the people of Birmingham are not prepared to put up with sick people-bashing? Is he aware of the large number of people who are ready to volunteer their services in order to help the hospital?
Mr. Ennals: I did not seek to underestimate the problems that are faced in the hospital because of the industrial action. The House should bear in mind that the health authority is responsible for the hospital. The area medical officer and other officers were at the hospital this morning and an agreed statement between the union side and the area health authority was issued. It read:
"At a joint meeting of officers of Birmingham AHA(T) and officers of NUPE and COSHE it was accepted that certain statements attributed to Mr. Bond director of the Radiotherapy Department Queen Elizabeth Hospital may reflect his personal view but do not represent the view of the AHA(T) which is as follows:
'Patients sent home from the Queen Elizabeth Hospital, including those from Radiotherapy are those whose treatment could most safely, though not ideally be suspended in the short term'."
The hon. Member for Birmingham, Edgbaston (Mrs. Knight) made reference to pickets and interference with patients. No patient's admission to hospital has been interrupted by pickets. I have made inquiries about this. It is true that two patients were delayed at the gate. [HON. MEMBERS: "Disgraceful."] I would say, and the House would say, that that is deplorable. All I can say is that, fortunately, it has been said that there were no medical consequences from these delays.
No such delays should take place. Patients should be able to move freely in and out of our hospitals. Of course they should. However, I think that the House should get the facts right and not try
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to blow the matter up into something that it is not. When we talk about threats of action and I hear of a consultant threatening that he will not treat someone who holds a union card, I believe that that is behaviour of almost equal irresponsibility.
Mr. William Hamilton: Will my right hon. Friend keep the House informed when and if he receives apologies for repeated allegations made by Conservative Members on several aspects of this matter? Is he aware that both the Leader of the Opposition and her spokesman on Scottish affairs, the hon. Member for Glasgow, Cathcart (Mr. Taylor), have made allegations in the House which have subsequently been proved untrue but that they have never withdrawn or apologised for them? Will my right hon. Friend invite them to condemn any doctor who refuses to treat any patient for whatever reason, and will he be assured that every Labour Member will condemn any action taken by anyone that jeopardises the health of any patient anywhere in the country?
Mr. Ennals: I agree with my hon. Friend. I have many times, from this Dispatch Box, condemned and deplored industrial action in the Health Service, whether by doctors, nurses, ambulance men or anyone else in the Service. In handling these grave problems, we must not discriminate between the action of one group and that of another. All of it is not only deplorable: it endangers the lives and health of patients.
Mr. Andrew MacKay: Is the right hon. Gentleman aware that the people of Birmingham will consider his statement totally complacent and will think that the director of radiotherapy at the hospital is the man who is best able to tell the effect of this action on his patients? Since the director said yesterday:
"I am sure some of these people will die because of this action",
what action does the Secretary of State intend to take?
Mr. Ennals: I have indicated the action that is to be taken over essential supplies and have explained what action has been taken on the access of patients. I understand that there is no real difficulty, but, if any question of obstruction or the like should arise, I have no doubt that

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the police would deal with it in the appropriate manner. The police are there today. I do not believe that anyone could say that my statement was complacent. I have been concerned to see that the facts are properly reported to the House.
Mr. Litterick: Will the Secretary of State accept that the factual part of his statement will be appreciated by his hon. Friends, being in sharp contrast to the hysterical ignorance of Conservative Members? Will he also accept that this and other events point, evermore dramatically, to the fact that the House, the Treasury and the people can no longer expect a first-class Health Service for poverty wages?
Mr. Ennals: I do not intend to go into the wages question at the moment. However justified anyone may feel his wage claim to be, there is, in my view, nothing to justify the action that has been carried out in some parts of the country to the damage of patients' lives. I say to those who take action that clearly goes well beyond the official union position that they are doing great damage to the cause that they seek to represent.
Mr. Grieve: Will the Secretary of State accept that the picketing of hospitals, whether in Birmingham or anywhere else, shows a callousness and wanton disregard for human life which disgraces a civilised society? Will he not, for once, recognise that in such a situation his statement falls lamentably short of what is expected of one of Her Majesty's principal Secretaries of State? Does he realise that the people of Birmingham and of my constituency will be horrified by his complacency in a situation that is likely to cause the death of Her Majesty's subjects in the West Midlands?
Mr. Ennals: No doubt the hon. and learned Gentleman wanted to get his supplementary question on the record, but I suggest that before putting such a question he ought to have listened to the language and the words that I used.
Several Hon. Members rose—
Mr. Speaker: Order. I propose to call one more hon. Member from each side of the House before calling the right hon. Member on the Opposition Front Bench.
Mr. Grocott: Is my right hon. Friend aware that while the Opposition mouth concern about the need to treat sick people at times of crisis, the fact is that in the West Midlands and elsewhere the normal practice among most consultants is not to treat people strictly on the basis of the degree of their sickness? Most are always prepared to deal first with the private patients who are prepared to pay.
Mr. Ennals: My hon. Friend knows the position that I take on that matter. An initiative was taken on 1 January in terms of the introduction of common waiting lists for urgent cases, whether in the private or the public sector.
Mr. Eyre: Does the Secretary of State realise the seriousness of the growing chaos affecting Birmingham hospitals? If essential supplies are denied, eight hospitals in the central area will be prevented from treating patients who are desperately in need of care. Does the right hon. Gentleman realise that Birmingham people will hold him directly responsible for seeing that the supplies are delivered and that services continue?
Mr. Ennals: I do not believe that the people of Birmingham will take any such simplistic view. The hon. Gentleman underestimates their intelligence. He will know that my colleagues and I want to see an end to the industrial action and a return to full service in the NHS. While industrial action is taking place, we shall act as precipitately and directly as we can to ensure that supplies get through and that the service is provided as well as possible.
Mr. Patrick Jenkin: Will the Secretary of State accept that we all condemn industrial action that hits at patients, from wheresoever it comes? Does he remember that the Home Secretary said yesterday that if there were a threat to cancer patients he would not be able to face their relatives and say that nothing would be done? The right hon. Gentleman said:
"We would do something about it."—[Official Report, 24 January 1979; Vol. 961, c. 427.]
Can the Secretary of State tell the House whether, as a result of the area health authority's meeting this morning, it has been able to give a categoric undertaking that the cancer patients will be readmitted to hospital and that their treatment, which

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ought never to have been interrupted, will continue? If not, what does he intend, in the Home Secretary's words, to do about it? Will he take steps positively to make sure that the food, supplies and equipment that are necessary for the treatment of these patients will be allowed into the hospital? Can he assure us that, if necessary, he will do it himself through the use of troops?
Mr. Ennals: I sometimes think that the right hon. Gentleman wants to see it done in that way rather than in the ordinary way. The Home Secretary said yesterday, and I confirm, that the union accepts that essential supplies, including medical and pharmaceutical supplies, must reach our hospitals. If they do not, we will find a way to do it. As I said earlier, the health authority and the union agreed at their meeting this morning on a list of medical supplies which would not be obstructed from going into the hospital.
Mr. Dykes: On a point of order, Mr. Speaker. My hon. and learned Friend the Member for Solihull (Mr. Grieve) expressed what the whole House will understand to be legitimate anxieties during the questioning of the Secretary of State for Social Services. The Minister replied to the effect that my hon. and learned Friend was just asking the question for the sake of it. Is it in order for a senior Minister to impugn the motives of my hon. and learned Friend in that way?
Several Hon. Members rose—
Mr. Speaker: Order. We had better move. Mr. John Peyton—private notice question.
Mr. Churchill: On a point of order, Mr. Speaker. Would it be in order for the Secretary of State to answer that part of the question from my right hon. Friend the Member for Wanstead and Woodford (Mr. Jenkin) concerning when the cancer patients are to be readmitted?
Mr. Speaker: The Minister has given his answer.
Mr. Molloy: On a point of order, Mr. Speaker. Would it help the position—[Interruption.] I am merely trying to be helpful, Mr. Speaker. When all supplies are available to all our hospitals and things return to normal, would it not help
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if the right hon. Lady, the Leader of the Opposition were to make a clear statement condemning those consultants who discriminate and create queue-jumping on cold cash considerations?
Mr. Speaker: Order. Hon. Members on each side are beginning to make points instead of points of order. There is another private notice question, there is also a statement to follow, and this is a Supply day.
Mr. Ennals: On a point of order, Mr. Speaker. Perhaps it would be helpful if I were to say that I am sorry that I did not answer the point made by the right hon. Member for Wanstead and Woodford (Mr. Jenkin). Having dealt, I hope satisfactorily, with the supply position—I point out that the decision was taken some time before 2.30 p.m. today—I very much hope that with supplies now flowing into the hospital it will not be long before it will be possible to resume normal admissions.
Mr. Patrick Jenkin: When?
Mr. Ennals: The right hon. Gentleman must recognise that these are decisions which must be taken by the health authority and the hospital authority concerned.

FOOD SUPPLIES
Mr. Peyton(by private notice) asked the Minister of Agriculture, Fisheries and Food if, despite the continued and widespread blockading of the ports, the interference with the movement of foods for people and animals, particularly in Merseyside, North Humberside, Avonmouth and Tilbury, the growing shortage of packaging materials, and the steady emptying of the pipeline, he is still satisfied that there is no serious threat to supplies of food for people and animals, and if he will make a statement.
The Minister of Agriculture, Fisheries and Food (Mr. John Silkin): The position at the ports since I last spoke to the House on Monday is as follows: there have been improvements in Northern Ireland, South Humberside, Sheerness and Southampton; there has been some improvement also at Tilbury, and a major improvement at Put-fleet, which is especially important for supplies of margarine,

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which had been causing concern in Merseyside, Avonmouth and Hull there has been no change in the position, but the Government are taking this up with the unions. [Interruption.] I rather anticipated that particular titter. That is why I gave a detailed list of the improvements that have been made precisely as a result of the Government's taking up matters with the union.
There has been some easing of the difficulties in packaging materials—[Interruption.] I am sure that the right hon. Member for Yeovil (Mr. Peyton) would like an answer to his question. The House might let me get on with it. There has been some easing of the difficulties in packaging materials—for example, in glass bottles and tin cans. But supplies of packaging materials in general are not as good as I should like, and the position needs to be watched on a day-to-day basis.
As the House knows, I have never concealed my concern about the pipeline, but, as regards the supplies in the shops, there has been some improvement in butter, imported bacon, sugar and margarine, and frozen foods. The supply of animal feedingstuffs remains reasonable, though not as satisfactory as I would like.
Finally, Mr. Speaker, I do not wish to depart from my statement of 22 January. I remind the House that it made four important points. First, there were good stocks of food in the country and adequate supplies in the shops, even though the position was not as good in the North-West as it was in the rest of the country. Second, the Government were keeping up their efforts to ensure that there continued to be enough food in the shops. Third, the position appeared to be improving, following the introduction of the code of practice on picketing. Fourth, potentially the position remained serious, and after what had occurred the chain of production and distribution might take some time to return to normal.
Mr. Peyton: I am grateful to the right hon. Gentleman for having given a rather fuller answer than he did earlier in the week. Nevertheless, I feel that the position is growing serious, and I hope that he will forgive me if I ask him several detailed questions.
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I hear what he says about the position in the ports, and I acknowledge particularly that there has been improvement at Purfleet. Is he aware, nevertheless, that at Tilbury lorry drivers are being asked to give their names and the numbers of their vehicles 24 hours in advance? It is almost impossible to comply with that requirement.
I am asking these questions, Mr. Speaker, in order to indicate the general atmosphere. Is the Minister aware that at Liverpool yesterday the chairman of the regional emergency committee visited the strike committee and was told—I paraphrase—to go away? Is the Minister aware that at Preston the local strike leader said "We shall decide where pickets go, not Moss Evans or the regional officers in Manchester"? Is he aware that at Humberside terms are being dictated to companies which have nothing to do with the dispute?
May I particularly ask the right hon. Gentleman whether he has received serious warnings about the animal feedstuff position from Preston, from Shrewsbury, from Humberside and from Liverpool, all those warnings carrying the same message—that without an improvement in the position they will not be able to continue to deliver to farmers for very long?
Is the right hon. Gentleman really satisfied that there has been an improvement in packaging materials, particularly glass? My information is that several firms have been brought to a halt for the lack of this material. I hope that the Minister will look into it as a matter of urgency.
As for human foods, is the right hon. Gentleman aware that, according to my information, salt is now coming out at only half the rate of last week, that is, 16 per cent. of the normal rate? In regard to oils and fats, is the right hon. Gentleman aware that Bromborough is under a total blockade, that at Erith all the storage tanks are full, and that it is impossible to get out anything at all? Is he further aware that sugar is down to 45 per cent. deliveries, and that cakes and biscuits are down to 50 per cent.?
Although shop shelves may be relatively full, has the right hon. Gentleman really appreciated that the pipeline is emptying quite quickly? One substantial chain of supermarkets informed me this morning

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that its stocks were down by 40 per cent. in volume and that its shelves were now empty of 40 per cent. of its lines.
Is this not a very comprehensive campaign, and does not the right hon. Gentleman find it very difficult to attribute it to either the capacity or the ill feeling of the Transport and General Workers' Union? Does he not believe that there are some much more wicked people involved?
Mr. Silkin: I wonder whether the House will be a little indulgent with me for about 30 seconds before I deal with those questions, because there is a point which hon. Members may not know about and which it might be of advantage to them to know. If hon. Members have detailed difficulties in their own constituencies, it would be helpful if they would get in touch with the regional emergency committees. This has happened in one or two cases—[HON. MEMBERS: "It is a waste of time."] It is not a waste of time, and indeed in some cases this has happened and the results have been good. If hon. Members want to look after their constituents, the first place to look after them is in their own constituencies.
Having said that, it is obviously right that I should give as detailed a reply as possible to the right hon. Gentleman. What he is telling us about is in fact the consequences of a strike, and I think all of us have been aware that there is a strike. Of course, if there is a strike. supplies get rather short. That is what happens in a strike. The right hon. Gentleman asked me, as he was perfectly entitled to do, where the areas of greatest difficulty are. He mentioned the North-West—Liverpool and Preston. I quite agree with him that that is probably the most difficult area of the lot. That is why I said, in answer to the right hon. Gentleman's question, that this was a matter that I was continually taking up, but it does present difficulties.
I do not believe that the position on Humberside has altered very much since I gave it to the House on Monday. I believe that animal feedingstuffs, although not perhaps flowing as freely as I should like, are now flowing through. The right hon. Gentleman mentioned packaging before human food. Perhaps he was right to do so, because many foods
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require packaging before reaching the shops. Certainly I said that I thought there was some reason for concern, as I looked at the pipeline, in the case of packaging materials. In terms of local difficulties—though I think that the Coop, for example, has a difficulty as regards bottles—in general the position is better.
Salt was another thing that the right hon. Gentleman mentioned. The position is better this afternoon. It has improved a great deal since Monday, and on Monday it was better than last week. The information that I received an hour or two ago was that the position is better.
Most of BSC's sugar is getting through, and that looks reasonably satisfactory. With Tate and Lyle, there is difficulty in Liverpool, but much less elsewhere.
The right hon. Gentleman mentioned Bromborough. Perhaps I should say that in that case I understand that negotiations are going on at this moment. There may well be some hope that the position will ease.
Mr. Peyton: May I ask the right hon. Gentleman one major question? Is he now satisfied that there is no serious threat, as things are, to the supplies of food for human beings and animals?
Mr. Silkin: I said that I saw no reason to depart from what I said on Monday, which is that the position—and I have to look at it from week to week—over the next weekend—[Interruption.] The right hon. Gentleman wants me to look even further ahead than that, and I am trying to accommodate him. Looking at the position over the next seven days, let us say, there are plentiful supplies—or in some cases not so plentiful supplies but in all cases adequate supplies of foodstuffs in the shops.
I am concerned about the pipeline. That is where the day-to-day watch must come in, and that is exactly what has been happening.
Mr. Corbett: May I commend the calm and reflective approach of my right hon. Friend to these difficult matters? May I ask him, in particular, not to heed the panicky advice from the Conservative Benches, which could only have the effect of making matters a lot worse than they are now?
Mr. Silkin: I thank my hon. Friend. I have come to the conclusion that the

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necessary pre-education for a Minister of Food during a lorry strike is to have been a Chief Whip.
Sir John Langford-Holt: May I draw the right hon. Gentleman's attention once again to animal feedingstuffs? Is he aware that the Liverpool strike committee is ignoring and not recognising validation certificates issued by other strike committees—I have in mind West Bromwich, for example—as a result of which lorries sent to Liverpool by my constituents are either, if they are lucky, being kept waiting for six hours or, if they are less lucky, being turned round and sent home?
Mr. Silkin: I am aware of that. I did say that I see a difficulty in the North-West which is not typical of other parts of the country. The matter is being dealt with very urgently, and, as I have told the House, the fact that there have been improvements in the supply position for human food and animal feedingstuffs is due to the very careful day-to-day watch that is kept.
Mr. Stephen Ross: Is the Minister aware that the situation in Southampton leaves a lot to be desired, as was vividly described in The Guardian yesterday, where perishable foodstuffs, including onions, are rotting because nobody is allowed to go in and take them?
Is the Minister also aware of the experience of my hon. Friend the Member for Isle of Ely (Mr. Freud), who today was accompanying a lorry driver who, although having the right credentials, was refused entry at Felixstowe? Does he agree that that shows that the whole system is breaking down?
Mr. Silkin: No; it shows that there are difficulties that need to be overcome. Many of those difficulties have been overcome, and the prophecies made of total gloom, starvation and hunger—not by the hon. Gentleman's friends, if he has friends, in the manufacturing industry, but by the Opposition's friends in the foodstuffs industry—have not come to fruition.
Mr. Arthur Lewis: Some might accuse the Opposition of trying to make political capital out of this, so has my right hon. Friend's attention been drawn to the statement
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made by that non-political person, the president of the National Farmers' Union, Sir Henry Plumb, who happens to be a European Conservative candidate, about the possible loss of animals of both sorts, human and otherwise? How many cases of loss of life among animals, human or otherwise, have been reported to him since the strike started, on the very first day of which it was prophesied that there would be such losses?
Mr. Silkin: First of all, Sir Henry Plumb is no longer the president of the National Farmers' Union, but he did say that the farmers were being throttled. I was present at his farewell dinner, at which 1,000 of them were being throttled in very good circumstances.
I say in all friendliness to Sir Henry Plumb, for whom I have a great affection, that on every day that has passed in the two and a half years since I became Minister of Agriculture, Fisheries and Food, there would have been a state of emergency if he had had his way.
Mr. Speaker: Order. I wish to indicate to the House what is in store for us before we get to the Supply day debate—the main debate of the day. There are business questions to follow; there is the statement of the Attorney-General; there are five applications under Standing Order No. 9. This is an extension of Question Time. I shall let it run for another five minutes and then we must move on.
Mrs. Kellett-Bowman: The Minister said that if hon. Members have difficulties in their constituencies they should take them up with the regional committees. He then went on to say that matters were being dealt with urgently in the North-West. Is he aware that the emergency committee there is so bemused and so worried that it has totally lost control and is desperately applying to the farmers' union to help it out of its difficulties and get cargoes released, but that unfortunately the trade union leaders have totally lost control of pickets in the North-West?
There will be no meeting until Monday, and even if there is a meeting on Monday it will take a week to get this sorted out. When the Minister says that matters are being dealt with urgently, and since the local committee has lost control, can he tell us exactly what will happen in the North-West?
Mr. Sikin: The hon. Lady ought to understand that the purpose of a regional emergency committee is not actually to shift feedingstuffs or foodstuffs by itself; it is to work with those people who know what the problems are to try to solve them. In the instance that the hon. Lady cited, I regard it as great credit to the committee that it is working so well with the National Farmers' Union.
Mr. Watkinson: Does my right hon. Friend accept that whilst there are difficulties in the West Country, there have been gross exaggerations about the feedingstuffs problem? Does he accept that farming interests in the West Country have told me that feedingstuffs are coming out of the port of Avonmouth?—[HON. MEMBERS: "You are wrong."] I am not wrong.
Does my right hon. Friend accept that some remarks, even by ex-presidents of the NFU, do not help the present situation?
Mr. Silkin: I have heard from a number of areas and in respect of a number of different commodities something of what my hon. Friend has said. There seems to be—I put it no higher than this—a feeling on the part of some people that, unless they express apocalyptic fears, somehow or other nothing will be done. They are quite wrong. Things are being dealt with properly, as far as the Government can deal with them. The Government are doing everything that they can to help.
Mr. Emery: Does the Minister recall that I raised with him on Monday a specific instance of extortion in secondary picketing, in which money had been demanded of both the driver of a load and the consignee? I gave the exact details to the Home Secretary. As at 2.30 pm today, absolutely nothing—but nothing—had been done. Surely, if we are to try to stop extortion by strikers who are secondary picketing, immediate action must be taken.
Mr. Silkin: I gather from my right hon. Friend the Home Secretary, with whom I have had a moment's consultation while the hon. Member was putting his question, that the matter has been reported to the police.
Mr. Henderson: It is not clear from the Minister's reply whether he was replying
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also on behalf of the Secretary of State for Scotland in this matter. Does he have any news to give us on the up-to date position in the Scottish ports, particularly in relation to the fishing industry and to the supply of fish boxes, which is causing a very serious problem in getting the fish moved? Is the Minister able to give us any up-to-date information on the supply of containers, canisters and cans for food processers? Companies all over Scotland are already laying off employees in these industries.
Mr. Silkin: I gather that my right hon. Friend the Secretary of State for Scotland made a statement on Tuesday. I think that in the light of the Scottish situation it is probably better if he rather than I dealt with Scottish questions.
Mr. Hardy: May I endorse my right hon. Friend's advice that we should consult our regional offices, where I am sure hon. Members will receive the calm, considerate and courteous response which I obtained earlier this week? Perhaps I may also thank those offices and my right hon. Friend for ensuring that feedingstuff supplies to the farms in South Yorkshire have been maintained at a satisfactory level right through the strike, and despite the most appalling horror stories that have been circulating about imminent cannibalism from the very first day.
May I also suggest that it would be as well if my right hon. Friend gave a little attention to the supplies of certain foodstuffs to South Yorkshire? Supply patterns throughout the country are not particularly even, and housewives of Rother Valley are a little short of sugar and lard.
Mr. Silkin: As I say, there are bound to be variations between one area and another. I shall certainly see that the problem raised by my hon. Friend is communicated as quickly as possible.
Mr. Sainsbury: Does the Minister realise that when he says that the supply of margarine had been causing concern, and when his right hon. Friend the Home Secretary says, as he did yesterday, that the position on food generally is unquestionably getting better, it gives the impression to the housewife that when she goes shopping there is nothing to worry about and that there will not be anything to worry about next week? Does the

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Minister recognise that throughout the country there are many shops that are completely out of stock of sugar, salt, margarine and lard? Does the Minister recognise that in nearly all food shops there are now only limited supplies of canned and packaged food? Does he appreciate that these food items are of particular importance to small households and the elderly?
The reason for this situation, as the Minister surely recognises, is that secondary picketing is being resumed in some cases, and food manufacturers and distributors are unable to get on with their jobs. Will the Minister clearly tell the House now—[HON. MEMBERS: "Too long."]—how food distributors—[Interruption.]
Mr. Speaker: Order The hon. Member is finishing his sentence.
Mr. Sainsbury: Will the Minister make a clear statement to the House as to how well he expects food distributors to be able to replenish the supplies now in their shops, so that there is an adequate supply of food for housewives next week?
Mr. Silkin: In the shops, the position varies from place to place and from shop to shop. The fact remains, however, that there are adequate supplies of food in the shops. It may be necessary to shop around a bit. As I say, the position varies from area to area.
There are still adequate supplies of fresh meat, bacon, butter, fruit, vegetables, sugar and margarine in the shops. The position on supplies of lard is a bit more difficult.
I must tell the hon. Member that I have the authority of quite a distinguished chain of food shops to back me up on this matter.
Several Hon. Members rose—
Mr. Speaker: Order. On this question I shall call one more hon. Member from each side of the House.
Mr. Ioan Evans: Will my right hon. Friend take this opportunity to pay a tribute to the housewives and consumers of Britain who responded to his appeal not to panic buy, despite the encouragement from Opposition spokesmen, which was widely reported in the mass media?
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At the same time, will my right hon. Friend explain the Opposition's attitude when Opposition Members say that there should be no Government interference with wage bargaining but then call upon the Government to interfere in this, that and the other?
Mr. Silkin: On the second point, I tried to say that when there is a strike, of course there will be shortages. The Government's intervention must be to see, as far as a Government can, that those shortages are fairly shared and that supplies are preserved as much as possible.
On the first point, it occurs to me that the housewives of this country are showing a great deal more sense than are some Conservative Members.
Mr. Eldon Griffiths: Since many of the targets of the secondary picketing in the eastern counties have been the jugular veins of the food industry—salt, yeast, blood from the abattoirs, and packaging materials—does the Minister agree that there are some signs that part of this picketing has been pre-planned, several months ahead? What is his comment on the suggestion of a senior trade union leader that some of it is politically co-ordinated and that some of it is financed from the outside?
Mr. Silkin: It would be interesting to see from what political party such suggestions came, because at moments such as this one hears all sorts of rumours. I heard that quite a few were from members of the Conservative Party. I shall not go into political motivation at this time, any more than I went into the political motivation of those manufacturers who told us that we would be starving over a week ago.

BUSINESS OF THE HOUSE
Mrs. Thatcher: May I ask the Lord President of the Council to state the business for next week?
The Lord President of the Council and Leader of the House of Commons (Mr. Michael Poet): The business for next week will be as follows:
MONDAY 29 JANUARY—Second Reading of the Price Commission (Amendment) Bill.

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Motion relating to the Wireless Telegraphy (Broadcast Licence Charges and Exemptions) (Amendment) Regulations.
TUESDAY 30 JANUARY—Second Reading of the Countryside Bill.
Remaining stages of the Estate Agents Bill and of the Public Lending Right Bill.
WEDNESDAY 31 JANUARY—Committee and remaining stages of the Price Commission (Amendment) Bill.
THURSDAY 1 FEBRUARY—Motion to appoint the Joint Committee on the Special Commission on Oil Sanctions.
FRIDAY 2 FEBRUARY—Private Members' Bills.
MONDAY 5 FEBRUARY—Supply [6th allotted day]: subject for debate to be announced.
Mrs. Thatcher: The Lord President has provided absolutely no time at all next week for hon. Members to discuss the current situation. He will be aware from the number of hon. Members rising in their places wishing to question Ministers about events or the circumstances of firms in their constituencies that there is a great demand for time for them effectively to be able to put their points. Will he therefore rearrange the business for next week to provide time for such a debate?
Mr. Foot: There is a debate this afternoon in which these matters will be raised. There will be a further opportunity for the Opposition directly to raise some of these matters in the business that I have announced.
The Government are, of course, eager to provide the opportunity for replies on these matters. I do not believe that anyone who has listened to the replies given by Ministers throughout this week could doubt that the Government have been most forthcoming in answering all the questions which have been put. It is very good evidence of the way in which the House can provide opportunities to deal with such problems.
Mr. Litterick: Has my right hon. Friend's attention been drawn to early-day motion 188, which draws the attention of the House to the proposed destruction of the Hillingdon law centre by the local council?
[That this House deplores the decision of the Hillingdon local authority to terminate
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all financial support to the Hillingdon Community Law Centre from 1 April 1979; and calls upon Her Majesty's Government to provide the necessary financial support to ensure that this indispensable community service will not be destroyed.]
As law centres throughout London and other parts of the country are experiencing similar problems, will my right hon. Friend provide time for the House to debate the status and position of law centres in Britain today?
Mr. Foot: I cannot promise time, for a debate next week, but, as my hon. Friend knows, there are many opportunities for individual Members to raise questions.
Mr. Ian Lloyd: Since the Secretary of State has now been under attack for some time, and since, as my hon. Friend the Member for Bury St. Edmunds (Mr. Griffiths) pointed out, there is at least a plausible assumption that sinister elements are at work, would it not be appropriate at some time next week for the House to go into secret session for a short period in order that the Secretary of State for Defence may disclose to us what advice he has received on this matter from military intelligence?
Mr. Foot: If such a matter were to be raised, I do not think that my right hon. Friend would be responsible. In any case, that is an absurd piece of scaremongering, which merely helps to contribute to an atmosphere that ought not to be encouraged.
Mr. Ward: Has the short and simple Bill to give new powers to district councils in respect of travellers' sites been prepared? Does my right hon. Friend accept that many district councils are anxious to have this power? Will he bring forward the Bill before Easter?
Mr. Foot: I cannot promise to bring it forward before Easter. However, I shall look into the representations that my hon. Friend has made over a considerable period.
Mr. Buchanan-Smith: I think that the Lord President heard the Minister of Agriculture say earlier that matters relating to food in Scotland should be left to the Secretary of State for Scotland. Does the Lord President acknowledge that since the Secretary of State made

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his statement on Tuesday the situation has deteriorated? Shops in Montrose, in my constituency, have no sugar at all, evidence of which I gave to the Scottish Office this morning. In view of this deteriorating situation, when will the Secretary of State for Scotland answer questions in the House on the urgent matter of food supplies in Scotland?
Mr. Foot: My right hon. Friend the Secretary of State for Scotland made a very good statement, as I believe the House appreciated when he made it. Of course, we shall consider when it may be necessary for him to make a further statement. In the meantime, the hon. Gentleman has taken the right course of taking up the matter either with the emergency committee or with the Secretary of State. That shows that the methods of this Parliament to deal with the situation are working.
Several Hon. Members rose—
Mr. Speaker: Order. I shall call those hon. Members who have already been standing.
Mr. Grocott: Will my right hon. Friend look at early-day motion 178, which condemns the action of the hon. Member for Cheadle (Mr. Normanton), who blocked my Bill to end the beating of handicapped children?
[That this House deplores the action of the honourable Member for Cheadle in blocking the Bill to end the beating of handicapped children; and urges the Secretary of State for Education and Science to respond to the feelings of all decent people by banning the cane in special schools forthwith.]
Is my right hon. Friend aware that that motion has now been signed by 59 hon. Members but that there have been no signatures by Opposition Members? Does he agree that all decent people in this country would feel that this practice should be stopped? If it cannot be done through the private Members' procedure, will he urge his Government colleagues to ensure that it is done by Government action?
Mr. Foot: Next Friday the House will have a further opportunity of considering the Bill introduced by my hon. Friend.
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If the Bill, which the Government will not be opposing, is enacted, no further action by the Government will be required. My hon. Friend knows that Bills of this nature have difficulties to encounter.
Mr. Maxwell-Hyslop: Is it not fatuous for the Leader of the House to suggest, in answer to a question from my right hon. Friend the Leader of the Opposition about what time he would make available next week for events that affect our constituents next week, that we can debate today events that will not occur until next week?
Mr. Foot: If we were to have a competition in fatuity, I do not suppose that there would be a better candidate than the hon. Gentleman. One of the very purposes of the House is to discuss not only what is happening this week but what might happen next week.
Mr. Skinner: Will my right hon. Friend consider urging his colleagues to make a statement on Times Newspapers Limited and the fact that many thousands of people have been locked out as a result of industrial action by The Times management? Will he also take into account that this morning I was searching for a suitable picket line for the Prime Minister to cross? May I suggest to him and his Cabinet colleagues that if he were to go to The Times he would, with my permission, be able to cross that picket line, which is manned by Duke Hussey and the rest of The Times management, and take with him those thousands of workers who want to get back to work, thereby reducing unemployment?
Mr. Foot: I agree with my hon. Friend. I did not know that he was such a passionate enthusiast for reading The Times, but I am glad to hear it. I agree that it is a serious matter for readers of The Times, for those who work on The Times and for the country as a whole that that newspaper should not be in production. It is the fact, as my hon. Friend stated, that this is a lock-out. Indeed, The Times has succeeded in having a lock-out without a single picket to enforce it.
Mr. Geoffrey Finsberg: For how much longer is the Lord President of the Council going to dishonour his promise to the House that there will be an adequate opportunity of debating EEC regulations?

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When will he stop hiding behind his promise of a debate on the Procedure Committee report, which he uses as an excuse to prevent proper debate?
Mr. Foot: I am not using it as an excuse to prevent proper debate. The hon Gentleman knows as well as I do the background to the matter. We shall have a debate on these questions. The Procedure Committee has made a report on a matter that touches these questions and at some time we shall have a debate. I hope to be able to include in my next Business Statement an indication of when we might discuss the Procedure Committee's report. I have no doubt that, had I included it in this Business Statement, I should have been criticised for not providing time for other matters. Some of the matters that we shall be discussing next week will be directly concerned with the economic situation.
Mr. Cryer: Will my right hon. Friend encourage his right hon. Friend the Secretary of State for Employment to make a statement next week, or even provide time for a debate, on the last report of the Health and Safety Executive? He will be keenly aware—I know that he is concerned about this matter—that more time is lost every year through industrial injury—a fact that the Opposition are totally uncaring about—than through strike action. Is not that the kind of matter that we should be debating rather than will-o'-the-wisp calls by the Opposition for debates on strikes?
Mr. Foot: I agree that it would be most desirable to have a debate on the work of the Health and Safety Commission. That is of major importance for the country, but sometimes these matters are difficult. There is pressure on time, and this matter can be raised by individual Members. However, I note my hon. Friend's proposal. I am not saying that we can do anything about this next week, but I hope that in the fairly near future we shall have a general debate on this subject.
Mr. St. John-Stevas: May I take the House back to the extremely important point raised by my right hon. Friend the Leader of the Opposition on next week's business? Does the right hon. Gentleman realise that throughout this crisis, which has been the gravest crisis that this country
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has experienced since the war, not a single day of Government time has been provided to debate the situation? Were it not for the efforts of the Opposition, we all know that there would be no opportunity for this House to discuss the crisis.
What is the point of tabling for next week a full day's debate on the Government's proposals on the Bingham report when the country is facing the present crisis? Will the right hon. Gentleman rearrange next week's business to enable the House to fulfil its constitutional function of expressing the mind of the people on the nation's problems through the representatives of the constituencies?
Mr. Foot: The House will have a convenient opportunity this afternoon to debate these matters. [HON. MEMBERS: "In our time."] Hon. Members say "In our time". I remind them that this is House of Commons time. It is the procedure of the House that so many Supply days are provided. The Opposition then choose the subject for consideration.
Mr. St. John-Stevas: What about next week?
Mr. Foot: The right hon. Gentleman has a Supply day the following week. I know that he does not want to debate the Bingham report. One of the reasons for our debating Bingham is that it was asked for by a most distinguished member of the Conservative Party, the chairman of the 1922 Committee. He urgently asked for a debate on the subject. I take full account of the hon. Gentleman's remarks, but I also have to take account of other views.
Mr. Madden: Will my right hon. Friend arrange for the Minister of Agriculture to make a statement about next week's meeting of EEC Ministers of Agriculture, at which there will be pressure for MCAs to be withdrawn, which will have the effect of sharply increasing British food prices? Does my right hon. Friend agree that if such an increase occurs it will be far greater than would be the effect on our food prices of a settlement of the lorry drivers' claim?
Mr. Foot: I do not minimise the effects of the lorry drivers' strike on food supplies, and nobody should do so. I agree that this is an important matter. I am

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not sure whether my right hon. Friend the Minister of Agriculture should make a statement next week, but some occasion must be found for it.
Mr. Tebbit: May we have a statement next week on the practice concerning Prime Minister's questions? Is the Lord President aware that considerable concern has been expressed time and again about the fact that almost all the questions tabled to the Prime Minister ask him about his engagements for the day, and similar matters? Is he further aware that although the Prime Minister in the past always answered questions about the social contract, now that we are told there is to be a new one, within a matter of weeks, not days, the Prime Minister has now resorted to transferring questions about the social contract, although at the Dispatch Box he still refers to the new negotiations for another one? May we have a little more sense injected into this matter?
Mr. Foot: The hon. Gentleman has got it wrong again. He has almost a 100 per cent. record of getting it wrong. On previous occasions such questions used to go to the Chancellor of the Exchequer. If the hon. Gentleman or other hon. Members have criticisms about the questions put to the Prime Minister, they must take a look at themselves. It is hon. Members who table questions and my right hon. Friend who provides the answers.
Mr. Ioan Evans: Has my right hon. Friend seen the report that large South African funds have been misappropriated and spent outside South Africa? Is any inquiry being made on the question whether any of those funds have been used in this country, and, if so, for what purpose? May we expect a statement on this topic?
Mr. Foot: I do not propose to make any statement on that topic. I suggest that my hon. Friend tables a question on the matter.
Mr. Alexander Fletcher: Will the right hon. Gentleman make a statement next week about the broadcasting arrangements for the referendum campaign? Does he agree that all these broadcasts should be evenly balanced between the proposition on the ballot paper, which amounts
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to voting "Yes" or "No"? What arrangements have been made to see that this idea is carried through in party political broadcasts?
Mr. Foot: These matters are usually discussed between the political parties. I shall see whether it is desirable to have a statement on the subject.
Mr. Michael Morris: Will the right hon. Gentleman have discussions with his Cabinet colleagues to see whether there should be a printed statement each day about the supply of food, so that hon. Members will know exactly what is the Government's information? I checked at noon today with the glass manufacturers, and I was told that every one of the Rockware factories was closed in respect of the inflow and outflow of glass bottles.
Mr. Foot: I do not think that a statement of that nature would be the best way of dealing with the matter. I insist that the way in which the House has dealt with this matter in the past week has been the best way of proceeding. It cannot be said that Ministers have been backward in making statements to the House.
I fully appreciate, as the right hon. Lady the leader of the Opposition suggested, that at times these matters interfere with some of the other business, but the House adapts itself to deal with these situations. I suggest that the House has been adapting itself fairly successfully.
Mr. Arthur Lewis: Is my right hon. Friend aware that since the road haulage strike began, each day we have been told that there is a grave shortage of food and that everybody is starving? Does he appreciate that the press, the police and many hundreds of workers, including Members of Parliament—if they can be called workers—are in this Palace of Westminster starving every day? May we have some information on how this starvation is affecting hon. Members, and will he see to it that Members get their food? I repeat that we are all supposed to be starving in this place.
Mr. Foot: My hon. Friend is a walking refutation of that accusation.
Mr. Michael Latham: Since there was once a time when the Secretary of State for Employment was supposed to settle disputes, could the Leader of the House arrange for his right hon. Friend next

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week to make a statement on this industrial dispute? So far that right hon. Gentleman has done nothing.
Mr. Foot: It is a very silly sneer from the hon. Gentleman to suggest that my right hon. Friend the Secretary of State for Employment has not been in the House. Those who suggest that he has not been here no doubt were not present when he was answering questions in the House this week. It is absurd for the hon. Gentleman to make any such accusation. I would remind the hon. Gentleman that the previous conciliation and arbitration facilities in the old Ministry of Labour are now incorporated in ACAS, which also has been working fully to resolve these difficulties.
Mr. Farr: May I ask the right hon. Gentleman for his help in this respect? Some of us have been coming to the House since Monday to try to catch Mr. Speaker's eye to put urgent questions to the Minister of Agriculture—and possibly to the Prime Minister—but have had no success. My question relates to the loss of 1,500 jobs, tonight, of workers who will be laid off and made redundant. I have been unable to put that question to the Minister concerned. Therefore, will the right hon. Gentleman make a more satisfactory arrangement to meet the difficulties of hon. Members such as myself, who can do no more than comply with the rules? Next week, while the present shambles continues, could we be given better access to the responsible Minister and for a longer period of time? Why cannot the Prime Minister be available, if not every day, at least for half an hour on Tuesdays and Thursdays, so that we may have a greater chance of questioning him?
Mr. Foot: If the hon. Gentleman wishes to serve his constituents immediately, he should contact the relevant Department on the subject. That is the normal method by which hon. Members seek to deal with these problems. It is misleading to people outside for him to suggest that because he has not caught the eye of Mr. Speaker he is unable to deal with these matters. Another service that the House might wish to have is a statement by my right hon. Friend the Secretary of State for Industry, and I shall examine that aspect. However, the suggestion that the hon. Gentleman has
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to wait for a statement before taking action is not true.
Mr. Nicholas Winterton: Is the Lord President aware that during the present desperate crisis the situation changes week by week, or even day by day? Is he aware that in the North-West tens of thousands of textile workers have been laid off or are being laid off? Will he, therefore, take the point raised quite rightly by my right hon. Friend the Leader of the Opposition and provide a day next week when the subject of employment can be discussed? During that debate perhaps the Government will indicate to the House whether they are prepared to take special measures—will the Lord President give an assurance on this? —to lift certain provisions of the Employment Protection Act which force employers to pay out lay-off pay. If they have to continue to do this and the lay-offs are protracted, there will be permanent job loss and many employers will go out of business.
Mr. Foot: The point that the hon. Gentleman is raising is not a question about business next week. He may be able to raise some of those matters, if he wishes, in the debate this afternoon. I presume that that is what the debate is for. If the hon. Gentleman and others suggest that they would like my right hon. Friend the Secretary of State for Industry to make a statement to the House—
Mr. St. John-Stevas: Yes, tomorrow.
Mr. Foot: The hon. Gentleman says "Tomorrow". I shall certainly consider whether that is the most convenient time. Some hon. Members may say that they would prefer to have it on Monday, but we shall see.
Mr. Sainsbury: Does the Lord President recall saying how important it was that the House should have an opportunity to discuss what will happen next week? Does he agree that in the light of that—since we will have an opportunity, very shortly perhaps, to consider what will happen next week—it would be most appropriate for the Government to provide an early opportunity next week for the House to consider what should happen the week after? We did not get much information on the subject of food from the Minister of Agriculture, Fisheries and Food today.
Mr. Foot: It is extremely churlish for the hon. Gentleman to suggest that he was not given any information—or that he was given very little—on the subject. He just did not like what he was told, that is all. His facts did not seem to accord with those given by my right hon. Friend. The House has had plenty of opportunity for statements to be made by Ministers. I fully acknowledge that in the present circumstances Ministers must constantly attend the House and answer such questions. That we have done and will continue to do.

QUESTION OF PRIVILEGE
Mrs. Kellett-Bowman: I wish, Mr. Speaker, to raise a matter of privilege that has arisen during the course of this afternoon's proceedings. I very much regret that the hon. Member for Rossendale (Mr. Noble) is not present. I must neverthless raise the matter now.
The hon. Gentleman raised a point of order about me during the course of which I understood him to state that the hon. Member for Lancaster had been informed that there were no problems over water supplies in Lancaster. That, I submit, is information that the hon. Member could have obtained only direct from the chairman of the North-West water authority, Mr. Mann. Is it not a breach of privilege for the chairman of a nationalised water undertaking to communicate to one hon. Member a private conversation that he has had with another hon. Member?
Mr. Speaker: Although the House has now ruled that privilege applications should come to me in writing, I allowed the hon. Lady to make her privilege request to me because she obviously feels very strongly on the matter. I never answer privilege questions on the day that they are raised. I always like time to consider them.
Mrs. Kellett-Bowman: I have my request in writing, Mr. Speaker.
Mr. Speaker: If the hon. Lady will be kind enough to see that it reaches my office, I shall be much obliged and shall look at the matter very carefully.

PICKETING
The Attorney-General (Mr. S. C. Silkin): With permission, Mr. Speaker, I will make a statement on the law relating to picketing.
It is necessary to deal separately with the criminal and the civil law. It is for the police to take action to enforce the criminal law. It is for those who suffer damage in consequence of civil wrongs to bring civil proceedings in the courts to restrain the commission of those civil wrongs or to recover damages.
Section 15 of the Trade Union and Labour Relations Act 1974 applies both to the criminal and to the civil law. Its ancestry now goes back over 100 years. Its effect is that peaceful picketing as defined in the section is not unlawful. Peaceful picketing is the attendance of one or more persons at or near somebody's place of work or business or anywhere else where he is except his home. The protection of section 15 is given if the attendance is in contemplation or furtherance of a trade dispute, if its sole purpose is to give or receive information or to persuade somebody to work or not to work, and if it is peaceful.
The criminal law makes no distinction between so-called "primary" and "secondary" picketing. But it does not permit acts which, apart from section 15, are breaches of the criminal law. It follows that, whether or not in the course of picketing, the criminal law is broken by violence, extortion, obstructing the highway, or obstructing the police in the reasonable execution of their duty.
Pickets may lawfully indicate to a driver their wish peacefully to communicate with him, but no law requires him to stop. If a picket obstructs the highway in order to cause him to stop, that is a breach of the criminal law and section 15 is no defence. A driver who wishes to drive past a picket line is in law entirely free to do so, so long as he drives in a lawful manner. If a driver or anyone else, including a picket, is unlawfully obstructed, intimidated or assaulted, he should report the matter to the police. Extortion of money as the price for letting a vehicle through would, of course, be a most serious offence and indeed a quite intolerable act, and anybody who is the victim of it has a duty to report it.

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Picketing as such is not a civil wrong. But its primary purpose is to persuade those who are under a contract of employment not to perform it. If that persuasion is in contemplation or furtherance of a trade dispute, and is the only actionable wrong, section 13 of the 1974 Act gave to the persuader protection from civil action by the employer. This protection went back to the 1906 Act. Section 3 of the 1976 Act added protection from an action based on direct interference with a commercial contract. If in either case the persuasion is not in contemplation or furtherance of a trade dispute, there is no protection and the injured party can obtain an injunction or damages.
The protection from civil action therefore depends on whether the persuasion which is the object of the picketing is in contemplation or furtherance of a trade dispute. This cannot be determined by the very loose terms "primary" and "secondary" picketing. But under recent decisions of the courts the test applied seems to have been whether the industrial action complained of has been so remote from the original trade dispute as to be not reasonably likely to further it. One can lawfully seek to ensure that one's employer's supplier does not supply him. But if he continues to do so, and one then seeks to ensure that the supplier to that supplier does not supply him, the decisions of the court suggest that one is entering the area of potential remoteness, where the section 13 protection runs out. In both cases the term "secondary picketing" would be apt, but the legal consequences could be quite different.
Finally, it has been suggested that the repeal of the 1976 amendment would make a substantial difference to the balance of strength between employers and unions. I disagree. In my view, its effect on that balance would be insignificant in the light of the remoteness test, which seems to me to be a far greater potential limitation on the protection provided by section 13. The repeal of the 1976 amendment would merely restore a host of anomalies to which the Donovan report rightly drew attention.
Sir Michael Havers: The House will be grateful to the Attorney-General for his statement and in particular for his emphasising that it is a serious criminal
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offence to extort money as the price of letting a vehicle through a picket line.
Does the right hon. and learned Gentleman agree that two major problems exist? The Trade Union and Labour Relations Act 1974, as amended in 1976, is widely thought to have changed the law so as to give immunity to almost all secondary picketing—that is, immunity from civil action even when that type of picketing induces a breach of contract between parties neither of whom is involved in the industrial dispute.
The second problem is that the 1974 Act, by virtually creating a total closed shop, provided a new situation in which the pickets can threaten those who wish to cross the picket line with the loss of their union cards and thus the loss of their jobs. In modern terms, that could be called peaceful intimidation. Will the Attorney-General advise the House whether such acts or threats come within the definition of peaceful picketing, and, if so, what remedy, if any, the lorry driver may have?
We should also be grateful for the right hon. and learned Gentleman's advice on whether it amounts to an offence where a lorry is only "allowed" to cross the picket line upon payment or promise of payment of a union subscription. Surely the right hon. and learned Gentleman would agree that the repeal of the 1976 amendment would effectively protect both employers and employees who are not involved in the industrial dispute, instead of our becoming involved in the complexities of the remoteness test.
Finally, has the Attorney-General asked the Director of Public Prosecutions as a matter of urgency to call for reports from the chief constables where such cases have been reported, so that speedy consideration can be given to prosecuting those who have committed criminal offences? I am sure that the Attorney-General will be aware that the present situation, in which in some cases the law is being construed as a licence to intimidate and barricade, is so grave and potentially dangerous to the nation's future that immediate action, action which must clearly have the full-hearted support of the Government, is essential.
The Attorney-General: I shall deal with those points in the order in which they were made.

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The right hon. and learned Gentleman said that the 1976 Act was widely thought to have given immunity to all secondary picketing. I cannot comment on whether that is widely thought to be the case. All that I can say is that my statement today was, I believe and hope, sufficiently clear to make quite certain what the real position is. I hope that that will be widely reported.
As for the closed shop, I do not agree with the right hon. and learned Gentleman that the amendment made in 1974 either has had the effect that he mentioned or that its repeal would open the door in the way that he has suggested. Indeed, I find a certain difficulty in the Opposition's attitude. If they are saying that the position should be that where employers, members and employees agree to have a closed shop, that should be done away with and people should be a great deal freer to opt out, that would inevitably have the effect that the strength of the union would be weakened. Yet it is the Opposition who are complaining that the union is not using its strength sufficiently in order to deal with pickets. The Opposition cannot have it both ways.
This is a very serious problem. The problem of pickets who do not comply with the instructions of their union has been the subject of a great many, probably the majority, of the questions that have been asked about this matter, which we have been talking about over the past week or two. Union discipline is a most important aspect, and that is what the Government are trying to achieve.
As regards the question of the threat that a person will not be allowed to cross a picket line unless he promises to pay a union subscription, that may very well be—I cannot answer directly—an offence under the provisions of the Theft Act. [HON. MEMBERS: "May?"] Yes, "may". I know that the right hon. and learned Gentleman knows the provisions of that Act at least as well as, or even better than, I do. It depends upon the mental state of the person concerned. Certainly in many cases it would be likely to be an offence, and it comes in the category of the class of case to which I referred in my statement, the case which many people will regard as being intolerable.
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Fourthly, the right hon. and learned Gentleman asked me whether I would ask the Director of Public Prosecutions to call for a report from chief constables. These are matters that are entirely within the responsibility of the chief constables. They are not within the Director's responsibility. There is no reason to suppose that chief constables are neglecting their duty in these matters.
The important thing is not the organisation at the top but that when offences of the kind to which I have referred occur, those who are injured or see them happening should report them, and then the police can get on with their job.
Mr. Fairbairn: On a point of order, Mr. Speaker. May I seek your guidance? We have had a very interesting lecture on the criminal and civil law of England, as it is to be interpreted by the Theft Act, which has no effect in Scotland. Its interpretation or its effects on any other statute certainly have no effect in Scotland. As the Lord Advocate is apparently not to make a statement, and as the Attorney-General hopes that his remarks will be widely reported, to whom are Scottish hon. Members to address their questions about the law of Scotland, and what are the citizens of Scotland to think when English gobbledegook is the analogy that the Attorney-General uses?
Mr. Speaker: Order. I can tell the hon. and learned Member for Kinross and West Perthshire (Mr. Fairbairn) that I have had no request for a statement about Scotland.
Sir Michael Havers: I ask the Attorney-General to deal with what I consider to be an extremely important question that I put to him earlier. What is the position when a trade unionist is threatened with the loss of his card and thus the loss of his job? Is that legitimate? If it is, what remedy should lie with the driver?
The Attorney-General: It may be a matter where the member concerned has a remedy at common law. As the right hon. and learned Gentleman knows, that depends upon the circumstances and the union's rules. He knows that the courts are by no means slow to protect members of unions who lose their right to union membership as a result of action that is not in accordance with the union's

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rules. Where a member of a union complies with the instructions that have been given by the union on picketing, and following that—it is purely a hypothetical case that has been put to me—there are threats and the actuality of loss of union membership, that would be pre-eminently a matter with which the courts could be likely to deal.
Mr. Douglas-Mann: Will the Attorney-General emphasise that no penalty may be lawfully inflicted on a member of a trade union who crosses a picket line, disregarding the instruction of the pickets, if he is acting in accordance with the directions of the committee that has control of the administrative affairs of his trade union? Will he emphasise again that the courts will protect by injunction and, if necessary, by damages a member of a trade union on whom an unlawful penalty is inflicted in that way? Will he consider, in conjunction with his ministerial colleagues, an extension of entitlement to legal aid without means test, or other legal assistance through Government-funded sources, to members of trade unions when it appears that their legal rights have been genuinely infringed as a consequence of unlawful action, and thereby ensure that members of trade unions may be certain that their legal rights will be protected and that the Government will back them if that is necessary?
The Attorney-General: I am able to confirm what my hon. Friend said in the first part of his question. The remedy of injunction is one that may be obtained extremely rapidly—indeed, much more rapidly than criminal prosecution. When the courts feel that the rights of individuals have been infringed, they have not shown themselves to be slow to grant such remedies. I have noted what my hon. Friend has said about legal aid. I shall discuss that with my ministerial colleagues.
Mr. Rathbone: Will the Attorney-General clarify two matters for a layman? Does violence encompass threats of violence? Do peaceful intentions go into the future? Specifically, does the law protect a young person who is a member of a union and who is forced by that union against his will to join a group that is picketing elsewhere? Secondly,
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do the courts protect a Red Cross worker who is instructed by her local Red Cross headquarters not to drive to her hospital because of the threat of blacking in future and the loss of her job in future?
The Attorney-General: Violence and threats of violence are equally criminal offences. Anyone who is forced to join a picket line by violence or threats of violence has the remedy of the criminal law, whether he be young or old. The hon. Gentleman asked about a Red Cross worker. I can only repeat that the problem invariably is one of the remoteness of the action to the dispute that is in question. If the action taken is of a sort that is not likely objectively to further the orginal dispute, the tendency of the courts is to say that it is not protected.
Mr. Pardoe: Will the Attorney-General be a little clearer about intimidation for a layman? Does he recognise that the most common form of intimidation for a layman would be the threat, actual or implied, of the loss of his union card and, therefore, the loss of his job? Does that amount to intimidation in the legal sense as the right hon. and learned Gentleman has defined it today? Will he make it clear whether it is a criminal or a civil offence? Does he accept that whatever the law may now say—it may have to be changed—it is wrong for anyone to threaten damaging consequences against anyone for performing a perfectly legal and lawful act?
The Attorney-General: In the last part of the hon. Gentleman's remarks he made an extremely wide statement, the implications of which, as he well knows, extend far beyond the industrial sector into the commercial sector. The answer to intimidation causing or being in connection with the loss of a union card must be that it depends on whether the intimidation is of a lawful character—
Mr. Raison: If it is done by a trade union, it is lawful.
The Attorney-General: The hon. Member for Cornwall, North (Mr. Pardoe) asked me a question and I am seeking to answer it properly. It depends on whether the intimidation is of a lawful character. The threat that a union card will be removed is not necessarily and of itself unlawful. That depends on the

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circumstances. There are many circumstances in which it may very well be unlawful.
I have already said in reply to the right hon. and learned Member for Wimbledon (Sir M. Havers) that in those circumstances the courts have gone into the question whether the loss or the threat is lawful. It is something that has happened in the past and there have been cases on that issue. Where the courts have come to the conclusion that an unlawful threat has taken place, one not in accordance with the rules, and that there has been intimidation by threat of force or something of that sort, they are not slow to take action. Whether it is a criminal offence depends entirely on the circumstances of the case. In the sort of case that I have spoken about where there is a measure of extortion, of course that would be a criminal offence. However, mere threat of the loss of a union card of itself with nothing more would not be a criminal offence.
Mr. Norman Atkinson: If a driver crosses a picket line to deliver essential goods with the permission of the pickets—
Mr. Tebbit: What does the hon. Gentleman mean by "permission"?
Mr. Atkinson: Is the Attorney-General saying that it is legal for the pickets to suggest to the driver that he donates his wages to a charity?
The Attorney-General: I think that it depends on the manner of the suggestion.
Mr. F. P. Crowder: Will the Attorney-General explain what he means when he says that intimidation as such can possibly be lawful? It amounts almost to blackmail, does it not?
The Attorney-General: The question put a moment ago indicates clearly the distinction that I was seeking to make. The word "intimidation" in the sense in which the hon. and learned Gentleman is using it no doubt implies something unlawful—that there is a threat of violence or a threat that something wrongful will take place. If there is such a threat, then, of course, intimidation becomes unlawful. But there again people often threaten things which are lawful. There is no criminal offence or civil wrong in threatening something which it is perfectly lawful to do.
Mr. Watkinson: Does my right hon. and learned Friend accept that he has made a very important statement today? Does he agree that the criminal law is available for many of those matters of which Opposition Members have complained? Does he also accept that no easy, snappy, redefinitions of section 13 or section 15 would solve the difficulties surrounding the picketing law? Does he further accept that the best way forward is voluntary consultations between the Government, the TUC and the CBI so that we can move on from that point?
The Attorney-General: I agree entirely with my hon. Friend. I endeavoured to make it clear in the first part of my statement that many of the matters complained of in this House are matters which are within the criminal law, and that those who suffer, or those who witness, offences against the criminal law have the right, and in many cases the duty, to report them to the police if the police are not on the scene. That is by far the most proper and speedy way of obtaining a remedy. As to the second part of my hon. Friend's question, I entirely agree that what my colleagues in Government are doing is by far the most successful way of dealing with these matters, rather than seeking to introduce a legal framework which has been shown to fail utterly.
Mr. Mayhew: Is not the definition of the word "intimidation" crucial to the whole question of policing picketing? Is it not the case that under the provisions of the Conspiracy and Protection of Property Act 1875—which is still the law—it is a criminal offence to prevent somebody from crossing a picket line, which he has the right to cross, by intimidation? Is it not the case that the Court of Appeal, as recently as 1974, has held that criminal intimidation is not to be limited to violence or threats of violence? Indeed, did not an earlier court hold that the word "intimidation" is to be given its everyday meaning, and is not the everyday meaning of "intimidation" sufficiently wide to embrace a threat to take away a man's union card and, with it, his job? Should not the police be so advised when they have to carry out the difficult job of policing the picket law?
The Attorney-General: The hon. and learned Gentleman is, of course, correct in saying that unlawful intimidation is not

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confined to intimidation consisting of the threat of violence. I have not for one moment suggested that this is so. However, I repeat that the position in law is absolutely clear: it is that the threat to do that which is unlawful is an unlawful threat, and the threat to do that which is lawful is a lawful threat. The hon. and learned Gentleman knows that perfectly well, because he knows that the whole train of authority in the courts on industrial and commercial matters has been to re-emphasise that principle again and again.
Mr. Ashton: If the law was changed to ban secondary picketing, and the 135,000 drivers on strike decided deliberately to defy that ban, would the facilities be available to bring them to court, fine them, imprison them or enforce the law in any way? Is it not a fact that in 1971, when a few dockers were deliberately singled out and locked up, they had to be bailed out by the Government of the day sending for the Official Solicitor? Does not my right hon. and learned Friend agree that it would be absolutely disastrous to bring in a new law which could not be enforced?
The Attorney-General: Everybody agrees that it brings the law into disrepute if one seeks to make unlawul that which cannot be enforced. Nobody would ever suggest the contrary, and, indeed, that was one of the great problems of the Industrial Relations Act passed by the previous Conservative Government. But, if my hon. Friend wants an even better example to illustrate his point, I suggest that he reads the appendix to the Donovan report in relation to the Betteshanger affair where it was sought to bring 2,000 miners before the courts because they refused to obey the industrial law. Had that situation not been so tragic in its folly, reading about it would have been extremely amusing.
Mr. Alexander W. Lyon: I sympathise with my right hon. and learned Friend in his attempts to explain very complex legal issues, but does this not emphasise the point that we do better by getting an agreed code of picketing to be enforced by the unions rather than trying to rely upon the niceties of the barons on whether withdrawing a union card is intimidation or not? Will my right hon. and learned Friend confirm that there is no legal authority of which I know which
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suggests that the mere withdrawal of a card in accordance with union rules can be intimidation, whatever the hon. and learned Member for Ruislip-Northwood (Mr. Crowder) may think? In confirming his view that the 1976 amendment had little part to play in what has happened in this dispute, I hope that my right hon. and learned Friend may take some consolation from the fact that on that particular night the Leader of the Opposition chose not to vote against the amendment.
The Attorney-General: I can confirm that, where the withdrawal of a union card is in accordance with union rules, unless there is something unlawful about it that withdrawal is perfectly lawful. Equally, if it is not in accordance with union rules, it is likely to be unlawful. I have been trying to explain that to Opposition Members.
I agree entirely with my hon. Friend that it is not only the complexities of the law on intimidation but the complexities surrounding commercial contracts, the problems of remoteness and all those matters to which we have referred this afternoon which make it so much better that this issue should be dealt with by the kind of agreement that the Government have achieved with the Transport and General Workers' Union, and would wish to achieve generally, than that we should try to cover it by an unworkable framework of laws.
Several Hon. Members rose—
Mr. Speaker: Order. In order to hold the balance, I shall next call two hon. Members from the Conservative Benches. I propose to allow these questions to run until 5.30, by which time we shall have spent three-quarters of an hour on this matter. It will have been a very good run. After that we shall have to move on.
Mr. Emery: Will the Attorney-General give an assurance that he or the Home Secretary will immediately circulate this very important statement to chief constables throughout the country?
Can the right hon. and learned Gentleman say something about numbers in picketing? This seems to be an area which he left out of his statement. Is not this something which the law would want to ensure was illegal where size of numbers brought about either a breach

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of the peace or ensured that intimidation was much more likely where someone was stopped from crossing a picket line merely by the actual number of pickets? Can he also tell the House something about the legal position of the strike committees, which supposedly now give permission for people to do what is already legal? What does the law have to say about the strike committees which have been issuing certificates to some and stopping others? What rights do they have to stop anyone from crossing a picket line?
The Attorney-General: If the House feels that the statement that I have made is worthy of circulation to chief constables, I am sure that my right hon. Friend the Home Secretary would take note of that flattering suggestion. I did not specifically mention numbers in picketing, but I referred to obstruction. I said that obstruction was one of the matters which could be illegal and contrary to the criminal law. If the numbers of those picketing were such as to create obstruction, that would be a matter which brought the criminal law into effect.
As to the strike committees, my understanding is that the TGWU headquarters has sent out a code of practice which it has asked the regional authorities of the union to ensure is followed. Inevitably, that means that those regional authorities dealing with the people on the spot have to be given instructions and told how those instructions are to be complied with. These are complicated matters which involve certain priority supplies. The House has heard about certain goods about which there may be doubts, because they are components in priority supplies, as well as others about which there is no doubt. I do not see how it is possible to carry out that kind of organisation without the sort of system which the hon. Gentleman suggested was quite wrong.
Several hon. Members rose—
Mr. Speaker: Order. May I appeal for shorter questions and, if humanly possible, shorter answers?
Mr. Fletcher-Cooke: Since the Attorney-General has said that neither he nor the Director is answerable to this House on prosecution policy and that it
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is a matter for the chief constables alone, can he suggest how prosecutions and prosecution policy can be questioned by hon. Members, since it is clear that there is already a difference of opinion about the degree to which intimidation can or cannot be classed as peaceful picketing?
The Attorney-General: The particular example to which the hon. and learned Gentleman has referred is one specific matter which as a question of industrial law comes within the responsibility of my right hon. Friend the Secretary of State for Employment. If the hon. and learned Gentleman is concerned about a difference of view as to what the law is on a particular matter, and it is a question which affects general prosecution policy, of course it is a matter which can be raised with me and I shall do my best to answer it. I was concerned with the actual events on the spot, and those are matters for the police to deal with.
Mr. Heffer: Is my right hon. and learned Friend aware that ordinary lay Members who are not lawyers could be confused at the exchanges which have taken place? Will he extend his explanation of the law to explaining the situation with regard to the position of employers? What about the employers' indemnity funds or the solidarity action that takes place by the employers' federations? Why do we only ever talk in terms of pickets as though workers were the only ones who should not take action in solidarity with each other? Will he explain that aspect of the matter in order to let the country know the position relating to employers?
The Attorney-General: The position with regard to employers is precisely the same in law as the position with regard to employees. I have not myself come across picketing employers, but that may be because I have not been aware of the fact that they do picket. But if they were to do so, under the sections to which I have referred they are subject to precisely the same rules as are employees. Indeed, I emphasised that protection exists both where those who are picketing seek to persuade people not to work and also where they seek to persuade people to work.
Mr. St. John-Stevas: Does not the Attorney-General agree that behind all these legal complexities there is one very simple constitutional point, which is that,

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by abdicating his constitutional responsibilities to Mr. Moss Evans, the Prime Minister has created the illusion that, unless one has a visa from the TGWU, it is unlawful to go through a picket line, whereas by the law of England it is the right of every citizen to go through a picket line if he so wishes?
The Attorney-General: No; I do not agree with that at all. It is really absolute nonsense for the Conservative Opposition to try to make cheap party political points of that kind. They know perfectly well that the quickest and most efficient way of minimising the inevitable disturbance which comes as a result of strike action in industrial disputes is to do precisely what the Government have done. Were they on the Government side of the House, they would be seeking to do that before they tried to do anything else.
Mrs. Wise: Does my right hon. and learned Friend recognise that, in exercising their right to attempt to persuade drivers, pickets will inevitably go much nearer to lorries than they would otherwise do? Will he emphasise that in those circumstances drivers have a, special responsibility to drive carefully? Will he condemn any statements that are made which incite drivers to run down pickets and to use their lorries as objects of intimidation?
The Attorney-General: I said in my statement that pickets have the right to draw the attention of lorry drivers to the fact that they would like to make contact with them. Lorry drivers are not obliged to respond. But I made it quite clear in my statement that the lorry drivers' right to drive past the picket line is a right which is qualified by the need to do so in a lawful manner, which means with proper care and without subjecting people to unreasonable and unnecessary danger.
Mr. Thompson: Did the right hon. and learned Gentleman submit his statement to the Lord Advocate for his advice and approval? If he did, can he advise us whether there are any remedies available under the common law of Scotland in addition to those that he has described as residing in the Ark?
The Attorney-General: My right hon. and learned Friend the Lord Advocate saw my statement before I made it. Indeed, the Solicitor-General for Scotland will by now have made a similar
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statement in another place. The Lord Advocate tells me that questions have been put to him on this matter which he has answered. I have no doubt that if there are any special matters relating to Scotland hon. Members will put further questions to him. Equally, if there is any special need to make a statement he will do so.
Mr. Rifkind: If the Attorney-General is correct in saying that it is not unlawful intimidation to threaten withdrawal of union cards, and thereby loss of employment, when a person exercises his legal right to cross a picket line, does this not suggest that the law needs changing?
The Attorney-General: I have made perfectly clear the position on the question of a change of law to make unlawful that which is at present lawful. But it is not for me, and the hon. Gentleman can take it up with the Minister responsible.
Mr. Edward Lyons: As the Attorney-General has made it crystal clear that by itself secondary picketing is not unlawful but that intimidation, obstruction and coercion are unlawful, is not the Opposition's attack on the failure to prosecute not an attack on the Government but simply an attack on the police and the chief constables? Are not such questions misplaced, because they seek to use the Government as a surrogate for chief constables?
Is it not correct that a picket has no power to threaten to take away a union card? There is only the power to threaten to report to the union conduct that might qualify for consideration for withdrawal of the union card. Is it also not correct that if the proper procedures are not followed and someone is expelled, he has recourse to the courts?
The Attorney-General: I have been concerned in the discussions throughout the history of these disputes. I have no doubt that the chief constables are performing their duty properly and adequately. I do not believe that they are in any doubt about the law. If they read my statement, they certainly will not be. I agree with my hon. and learned Friend that the attack on the Government is totally misplaced. I believe that it is prompted purely by the hope of party advantage rather than by the interests of the nation as a whole.

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My hon. and learned Friend is right on his second point. I know of no threat to any body to take his union card away there and then. No such case has been reported to me. If any hon. Member has knowledge of such a case, he should report it to the police. They are the people who should deal with it. When questions were asked about the removal of union cards, I understood that they were referring to precisely what my hon. and learned Friend has said.
Mr. Edward Gardner: Is the Attorney-General prepared to say that the pickets who act against firms that are not directly involved in their industrial dispute cannot under the present law claim immunity from legal action? Does he agree that if the state of the law on this point is uncertain it should be changed? Does he agree that any uncertainty should be removed by amendments clarifying the meaning of the law?
The Attorney-General: In my statement I made the position as clear as the courts have made it, and certainly as clear as in the most recent cases involving the Daily Express and the Press Association. In due course we shall all benefit from reading the judgments of the Court of Appeal, including that of the Master of the Rolls. The hon. and learned Gentleman should find that those judgments make absolutely clear the position on remoteness. The Court of Appeal decisions are, of course, subject to the decision of the highest court, but the law is clear as it stands in the Court of Appeal. The doctrine of remoteness applies in the case of civil proceedings for injunction.
Mr. Litterick: On a point of order, Mr. Speaker. I am aware that you are most anxious that all hon. Members should feel that they receive equal treatment at your hands and those of your deputies. However, will you give the House some assurance that, on all future occasions when a ministerial statement is made, you and your deputies will give preference to hon. Members who heard the statement?
Mr. Ron Thomas rose—
Mr. Speaker: I know that the hon. Gentleman was not called either. I shall listen to his point of order.
Mr. Ron Thomas: Further to that point of order, Mr. Speaker. Should hon. Members who come in after a statement has been made be able to catch your eye and put questions to the Minister?
Mr. Speaker: I will answer that at once. Normally, if I am aware that an hon. Member has come in after the statement has begun, I do not call that hon. Member until the very end, if at all. If that has happened today, it was an oversight on my part. It is my general practice to give preference to other people if hon. Members are not in their place when a statement is made.

GRAVE DIGGERS AND CREMATORIUM ATTENDANTS (LIVERPOOL)
Mr. Steen: On a point of order, Mr. Speaker. Yesterday I raised under Standing Order No. 9 the question of
"the effect of the grave diggers and crematorium operators strike and the inability to bury the dead in Liverpool".
After you had given your ruling, the hon. Member for Liverpool, Scotland Exchange (Mr. Parry) stated that I had given
"a distorted and biased account of the strike in Liverpool"—[Official Report, 24 January 1979; Vol. 961, c. 452.]
Subsequently, he told me that what I had said was factually correct. May I have your guidance as to how I can best record that he wishes to withdraw his statement?
Mr. Speaker: The hon. Gentleman has made his point.

NATIONAL UNION OF PUBLIC EMPLOYEES (BIRMINGHAM)
Mr. Andrew MacKay: 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 effect of NUPE action in Birmingham".
I suggest to you, Mr. Speaker, that this is a specific matter because today in the Birmingham area 300 miles of motorway around the city, heavily covered by snow which fell during the morning rush hour, were not gritted in any way because 270 motorway maintenance men, who are

723
members of NUPE, were on strike. That, combined with the fact that there were no trains today, caused considerable danger to my constituents and other road users.
I further suggest to you, Mr. Speaker, that this matter is important because 46 cancer and radiotherapy patients were sent home from Queen Elizabeth hospital yesterday because of NUPE action. I am told that more are due to go home today. In total yesterday 120 patients were sent home, and a further 75 were sent home by noon today. It has been suggested to me that further patients will be sent home this afternoon. Yesterday 38 operations, some of them serious, were cancelled at the same hospital.
This matter is urgent. I quote from Mr. William Bond, the director of radiotherapy. Despite what the Secretary of State said, I consider that Mr. Bond is the man most likely to know whether his patients are in danger or at risk. He said:
"I am sure that some of these people will die because of this action."
Finally, the matter is urgent, because the regional divisional organiser of NUPE, Mr. Barry Shuttleworth, said on commercial radio in Birmingham today that he believed the matter should be debated urgently in this House because he was worried about the effects of the action that his members were taking. Therefore, I believe that the matter should receive the urgent attention of the House.
Mr. Speaker: The hon. Member gave me notice before 12 o'clock 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, namely,
"The effect of NUPE action in Birmingham."
The hon. Member has made a very serious statement, to which I listened with great care. He and the House know that it is for me to decide not whether this matter is to be debated but whether it is to be the subject of an emergency debate. That is the only power that I have.
I regret that his submission does not fall within the provisions of the Standing Order, and therefore I cannot submit his application to the House.

RAILWAYS (INDUSTRIAL DISPUTE)
Mr. Sims: 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 continuing and worsening series of strikes on British Railways, due to an inter-union dispute."
I base my request on three grounds. First, British Railways have intimated that they are losing £5 million each day of the strike. Unless these sums can be recouped by radical internal economies, including staff reductions, the costs will have to be borne either by passengers paying further increased fares or by the people generally, through taxation.
Secondly, large quantities of raw materials, goods and equipment normally conveyed by rail are being delayed on their way to manufacturers and customers, thus exacerbating the damage already inflicted on the economy by the road haulage dispute. This is particularly serious in the case of delaying export orders to the docks.
Thirdly, hundreds of thousands of people, including my constituents, who normally travel to work by train are now back to working a three-day week. This is particularly so in London and the South-East, although it is also occurring in the provinces. It is happening for the second week running after sporadic one-day strikes for some time.
All this is because of a dispute, not so much between employer and employee but between two unions. The nation is suffering for this. I suggest that the effects of the dispute are such as to qualify it as a specific and important matter which merits urgent consideration by the House.
Mr. Speaker: The hon. Member gave me notice before 12 o'clock 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, namely,
"The continuing and worsening series of strikes on British Railways, due to an inter-union dispute."

725
The hon. Gentleman has raised a very important question to which I have listened with great care. The House has instructed me not to give the reasons for my decision when I receive an application of this sort.
I regret to have to tell the hon. Member that his submission does not fall within the provisions of the Standing Order. Therefore, I cannot submit his application to the House.
Mr. Parry rose—
Mr. Speaker: Before I call the hon. Member for Liverpool, Scotland Exchange (Mr. Parry), I remind the House that Standing Order applications cannot be used to answer another application that has been made, and all that one can do in making an application is to put the case for an emergency debate.

GRAVE DIGGERS AND CREMATORIUM ATTENDANTS (LIVERPOOL)
Mr. Parry: 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 grave diggers' and crematorium attendants' strike in Liverpool, following the unsatisfactory pay offer."
The hon. Member for Liverpool, Waver-tree (Mr. Steen) made a similar application yesterday, and, although his facts about the dispute are correct, he made a vicious and unfair attack on the trade union movement—
Mr. Speaker: Order: The hon. Member cannot use Standing Order No. 9 applications for debate across the House. He must make out his case as to why I should grant him an emergency debate.
Mr. Parry: I declare an interest as I was formerly a full-time officer of NUPE and I am now a Member of this House sponsored by the TGWU. I fully understand the frustration of the manual workers in the local authorities and the ancillary workers in the Health Service over the pay application that they have made to the employers. It is time some-
726
body told the House the way in which these employees have fallen behind average earnings during the last three years.
For example, in 1975 the average earnings of a male manual worker in a local authority totalled £13·30—lower than the average earnings in other industries and services. In 1978—[Interruption.]
Mr. Speaker: The House must be fair. The hon. Member is seeking to make the case for an emergency debate because the pay of these workers has fallen behind. This point is quite within order and it should be listened to by hon. Members.
Mr. Parry: The level of earnings in 1978 is now £22·40 a week for male employees in the industry. For females it has risen from £4·60 in 1975 to £10·10 in 1978. The figures for the porters and cleaners in the National Health Service are similar. In spite of the wide difference between these earnings and earnings outside, the employers have made the scandalous offer of £1·80 per week. Therefore everyone should understand and appreciate why these workers are going on strike. The Offer to part-time cleaners, who work a 20-hour week, and home helps is a miserable 28p.
I made a special request yesterday to the General and Municipal Workers Union to call off the strike because I feel it is wrong to cause such distress to the families of the dead. I was taught that one of the seven corporal works of mercy was to bury the dead. I said that I hoped that the workers would return to work and that the employers and Government would take note of the wide difference in earnings between the local authority and outside industries. I would hope that this would prevent any further confrontation affecting the general public.
Mr. Speaker: The hon. Member gave me notice before 12 o'clock 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, namely,
"The grave diggers' and crematorium attendants' strike in Liverpool, following the unsatisfactory pay offer."
The hon. Gentleman knows that I do not decide whether a matter will be debated. I merely decide whether there should be an emergency debate. I have

727
to rule that the hon. Member's submission does not fall within the provisions of the Standing Order. Therefore, I cannot submit his application to the House.

TRANSPORT AND GENERAL WORKERS' UNION (SOUTHAMPTON)
Mr. Adley: I apologise to you and the House, Mr. Speaker, for this further application, but 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 which should have urgent consideration, particularly in view of what we have heard earlier this afternoon, namely,
"the refusal of the Transport and General Workers' Union regional office in Southampton to allow union members freely to express their views against official union policy".
This matter is specific, because the events took place this week at Transport House, Southampton, directly affecting a number of my constituents, who are drivers employed by Ingram's, of New Milton, and who are members of the Transport and General Workers' Union. It is important, Mr. Speaker, because the freedom of the individual is at stake. These drivers have had no ballot on whether to strike. They have received no approach, as local members of the TGWU, from any of their officials. Their last resort was to go to express their views at the union's regional headquarters. The denial of the right to speak, or even to attend a meeting, is undoubtedly related to their publicly expressed opposition to the strike, in which they have been joined by drivers in a number of other companies in the South of England, such as Flewin's of Andover, some of whose drivers received the same treatment at the same meeting.
To deny union members the right to attend union meetings because they publicly disagree with union policy is equivalent to stopping Members of Parliament at the Members' entrance of this House if they publicly disagree with Government policy. It is totally undemocratic.
This matter is urgent because of the escalating ill will that the strike appears to be breeding, evidenced by events at Battle hospital, Reading, yesterday. The
728
Home Secretary told us yesterday that the TGWU had agreed that there would be no reprisals against those who crossed picket lines. But that is only one aspect of the current situation. Men will work and men have accepted employers' offers. But it is employers, in many cases small employers, who will not let them work, for fear of post-strike reprisals if they cross picket lines. Few doubt the good intentions of the Home Secretary but we have not yet heard how he intends, on behalf of Parliament, to honour the pledge which he gave the House yesterday about no intimidation. As one of the strikers refused permission to attend the meeting said to me, "It is all right at the top, but it does not get down the line". Are you further aware, Mr. Speaker, that drivers who are not on strike but whose employers are frightened to let them work and who are therefore laid off are now being denied unemployment benefit?
I wish to refute in advance any allegation that I am seeking to make political capital out of this situation. I neither know nor want to know the political stance of my constituents, but I know that they have been forced not to work and have been unable to exercise their free choice to work. It is my clear duty as a Member of Parliament to voice their fears in this House of Commons. The union office should be their forum. The union rule book should be their protection. Yet their office is barred to them, their rule book is abused, and now the local branch secretary of the union has gone ex-directory on the telephone. I submit, Mr. Speaker, that this House of Commons must hear their case.
Mr. Speaker: The hon. Gentleman gave me notice this morning that he would seek leave to move the Adjournment of the House, under Standing Order No. 9, to discuss a specific and important matter that he believes should have urgent consideration, namely,
"the refusal of the Transport and General Workers' Union regional office in Southampton to allow union members freely to express their views against official union policy".
I listened carefully to what the hon. Gentleman said, 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.

PICKETING
Mr. Gow: Mr. Speaker, I beg leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter which should have urgent consideration, namely,
"the confusion caused by the statement of the Attorney-General in the House of Commons on 25 January 1979 in regard to the law of picketing and the urgent need to redefine that law".
The three criteria are that the matter should be specific, important and urgent.
This is a specific matter. You, Mr. Speaker, were in the Chair, and it would be a miracle if you were other than wholly confused about the state of the law, having listened to the exposition given by the right hon and learned Gentleman.
The matter is important. It is difficult to visualise any matter which is of greater concern to the overwhelming majority of our constituents than the law of picketing. Indeed, the House and the country were waiting agog to listen to the right hon. and learned Gentleman explain to the nation exactly what the law was and precisely what the Government were proposing to do in order to improve the law. The House and the nation, not for the first time, waited in vain.
Thirdly, Mr. Speaker, I seek to satisfy you that this is an urgent matter. A week ago today, the Prime Minister came to the House waving a piece of paper which was the code of practice issued by the Transport and General Workers' Union. The Prime Minister then told the House:
"The code explicitly provides that…it rules out secondary picketing"—[Official Report, 18 January 1979; Vol. 960, c. 1957–53.]
Secondary picketing has not been ruled out by the code of practice agreed by the Transport and General Workers' Union. The undertaking which was given to the House by the Prime Minister has been ineffective. Secondary picketing goes on, and the statement of the Attorney-General today has done nothing to increase the prospects that secondary picketing will be removed. In those circumstances, I submit that it is urgent and vital that the House of Commons should debate the Attorney-General's statement and the overriding need to redefine and update the law on picketing.
Mr. Speaker: The hon. Member asks leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he believes should have urgent consideration, namely,
"the confusion caused by the statement of the Attorney-General in the House of Commons on 25 January 1979 in regard to the law of picketing and the urgent need to redefine that law."
As the House knows, under Standing Order No. 9 I am directed to take into account the several factors set out in the Order but to give no reason 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 that, therefore, I cannot submit his application to the House.

BILLS PRESENTED
  CROWN AGENTS
  Mrs. Judith Hart, supported by Mr. Secretary Owen, Mr. Secretary Varley, Mr. Joel Barrett, Mr. Secretary Smith, Mr. Attorney General, and Mr. Charles Morris, presented a Bill to reconstitute as a body corporate, and make other provisions with respect to the Crown Agents for Overseas Governments and Administrations, including the establishment of a Board to realise certain of their assets: And the same was read the First time; and ordered to be read a Second time tomorrow and to be printed [Bill 61].

  MERCENARIES
  Mr. Frank Hooley presented a Bill to prohibit the engagement in warfare or armed conflict by United Kingdom citizens save only as members of the Armed Forces of the Crown or in pursuance of specific treaty or international obligations entered into by Her Majesty's Government; to make unlawful the procurement, recruitment, enlistment or training by private persons of other citizens for the purpose of engaging in armed conflict or warfare; and for related purposes: And the same was read the First time; and ordered to be read a Second time on Friday 2 February and to be printed [Bill 60.]
  Mr. Emery: On a point of order, Mr. Speaker. We have now been sitting for

  731
  three and a half hours and there is one matter which frequently goes without comment. A single individual, for the whole of that time, has had to be entirely at the top of his form, displaying attention, charm and ability in dealing with matters during a very difficult and emotive period in the House. I think that the House should at times pay tribute to the great way in which you take the Chair.
  Mr. Speaker: That is the best speech I have heard for many a year. I am very much obliged to the hon. Gentleman.

BUSINESS OF THE HOUSE
Ordered,
That, at this day's sitting, Standing Order No. 3 (Exempted Business) shall apply to the Motion relating to the steel industry with the substitution of half-past Twelve o'clock or two and a half hours after it has been entered upon, whichever is the later, for the provisions in paragraph (b) of the Standing Order—[Prime Minister.]

ORDERS OF THE DAY
  SUPPLY
  [5th Allotted Day]—considered.

  ECONOMIC SITUATION
  5.59 p.m.
  Sir Geoffrey Howe: I was wondering whether it might be prudent for me to move this business under Standing Order No. 9.
  Mr. Speaker: I hope that the right hon. and learned Gentleman will forgive me, but I should have told the House that I have selected the amendment in the name of the Prime Minister.
  Sir G. Howe: I am sure that the House will be prepared to forgive you, Mr. Speaker.
  I beg to move,
  That this House, being deeply concerned at the deteriorating economic and industrial situation, calls upon Her Majesty's Government to fulfil its responsibilities to the nation by bringing forward measures which will restrain expenditure, encourage output, secure the citizen's right to work and restore the authority of Parliament.
  Since the House returned from the Christmas Recess there have been a large number of opportunities for hon. Members to discuss the day-to-day anguish of the changing industrial scene. For what remains of today I hope that the House will focus its attention—as the nation would wish—on the longer-term problems which have shown themselves as a result of the industrial events that have taken place since the beginning of the year.
  I do not wish to chronicle the many examples of disaster which have been debated in the House in recent days. Suffice it to say that industrial and social strife is now so widespread and so bitter that in the ordinary way any one of a dozen aspects which have arisen in the House day after day would once have shocked the nation to its core.
  It is plain to all that with every day that passes in this style more and more serious damage is being inflicted, not only on our economy but upon the unity of our society. In those circumstances, it is right

  733
  that the House and the nation should be reminded of the thousands of speeches on this subject that were made almost exactly five years ago.
  I remind the House of a speech by the Prime Minister in February 1974 in which he said:
  "The dislocation that British industry has been forced to suffer this winter was wholly unnecessary and served only to try to distract the electorate from the real problems facing the country."
  He also said:
  "If Mr. Heath's policies were pursued for another five years, the end would be two nations glaring at each other across the ruins of the British economy…Labour proposes…a return to negotiation and an end of confrontation. Under Labour we offer a new social compact which will draw this nation together."
  If events of this year have done one thing, the myth that the Labour Party has any special capacity for dealing with the other half of what used to be called the Labour movement has now been totally and for ever destroyed. All the frantic efforts of the next few weeks, in whatever fine language or dress they might be presented, will not succeed in putting that myth together again.
  That is why it is now widely recognised, even by many who have supported the Labour Party in the past, that we need to seek a different approach to these problems. People are looking to this House to find common ground on which we can achieve greater success in these matters.
  What should that common ground be? We must assume that in some way, at some time and on some terms, the present bout of strife will come to an end. The temptation then will be to relax and believe that we can go on roughly as we have before. The Chancellor of the Exchequer and the Prime Minister will have every reason to encourage people to take that view.
  The reality is that if we go on in the style that we have adopted in recent years we shall be on a course of continuing decline. It is essential to accept and recognise that in a way in which the Chancellor and the Prime Minister are unwilling, understandably, to do.
  In the last three or four years, on occasion after occasion, we have had promises of golden prospects. Last year
  734
  the Prime Minister said that we could now look forward to a "golden decade Last October the Chancellor did not qualify his pledge in any way. He said:
  "Whoever wins the next election is going to inherit the best balanced economy, the best economic prospects of any Government since the war."
  Even last week he looked back at 1978 and described it as a
  "year of exceptional achievement."
  When the Chancellor and the Prime Minister present that picture of the outlook, is it any wonder that working people find it difficult to accept the harsh reality that they are not entitled to higher wages as a reward for the years of sacrifice of which the Chancellor and the Prime Minister constantly speak?
  There was a revealing moment on the programme "TV Eye" last Thursday on which appeared Mr. Moss Evans, Mr. Duffy and Mr. David Basnett. Both Mr. Evans and Mr. Basnett referred, as a justification for the present situation, to the sacrifices which the trade union movement had been making. They were echoing the theme that they must have heard often from the Chancellor and the Prime Minister.
  One can imagine their astonishment when the Chancellor in a "quick comment" said:
  "There was no freeze three years ago."
  He was right about that. He said:
  "There was a 10 per cent. wage increase, and for many people that was six pounds a week, which they would never have got under normal collective bargaining…there was no real sacrifice."
  That represents an astonishing change in the Chancellor's position. He went on:
  "last year we had the biggest increase in living standards for working people in Britain that's been in one year at any time since the war."
  One must examine how and why that has happened. It is misleading to suggest that we are now at the end of a period of dramatic success.
  I leave aside the fact that prices have doubled and that unemployment has more than doubled and other familiar facts of that kind. Let us examine the Chancellor's statement last week that this has been a "year of exceptional achievement". By September of last year the real net income of a family with two children was still lower than it was in 1973 or 1974. We have been going

  735
  through a period in which the volume of manufactured imports has been rising at a rate of 16 per cent. while manufactured exports have risen by 6 per cent.
  Last week the Chancellor talked about the success with which Britain was paying her way in the world. But two years ago he told the International Monetary Fund that he expected to end 1978 with a balance of payments surplus in excess of £2,000 million. In fact, he has just broken even.
  Between the second half of 1977 and the second half of the current year the non-oil balance of payments will have deteriorated by about £4,500 million. This is the year of "exceptional achievement" according to the Chancellor.
  No wonder that within six days of his making that claim the Governor of the Bank of England, speaking in Scotland, said:
  "we now see that the net contribution of some £5 billion made by North Sea oil to our GDP over the past four years has been very largely matched by the strong growth in personal consumption recorded last year—a growth satisfied importantly by imports…we cannot in my view regard the pattern of demand in 1978, and only a marginal surplus on the current account of our balance of payments, with much satisfaction."
  So much for the year of "exceptional achievement".
  That is the reality. In these circumstances, as we have told the Chancellor, the most crucial purpose of our economic policy should be to create the conditions of maximum incentive for industry and enterprise at every level in order to recreate the growth and dynamic of our economy. Industry should be given back the prospect of profit.
  Let us examine what the Government propose to do as a result of their announcement last week. They know—or they should, since they have told industry this many times—that profits are almost at their lowest real level of any time in our history. And yet they are proposing to remove the profit safeguard and to introduce a futile and profoundly damaging Bill for tightening price control.
  That it is futile is shown by the fact that the Government announced the introduction of the Bill on Tuesday and three days later the Secretary of State for Prices and Consumer Protection announced the abandonment of the only remaining price
  736
  control policies. The Bill will do great damage and is a futile gesture.
  Industry needs the prospect of rising profits, a reduction in personal taxation as quickly as possible, and low and stable interest rates. All these are rendered unachievable by the current high level of public expenditure.
  The White Paper will not be debated today. However, the House should notice that, although last year the Government planned to increase public spending by about 2 per cent., it rose by between 7 per cent. and 8½ per cent.—by more than £4,000 million. The Government say that they intend to increase public expenditure in the year ahead by 2 per cent. The likelihood is that it will rise by much more than that. Therefore, the Government, by increasing the huge burden of public expenditure in two years, will have cast away all the gain that has been so painfully achieved in public expenditure reductions under the supervison of the International Monetary Fund. They will have achieved the certainty of high interest rates—12½ per cent. now, and who knows where they may be soon?—and excluded the prospect of any significant cuts in personal taxation. Even that rosy picture will be attainable only on the assumption in the White Paper that pay settlements are kept to 5 per cent. and earnings growth to 7 per cent.
  No wonder that the Chief Secretary, who has been preparing such White Papers for the Chancellor for some years—too many years for all of us—knows his man well enough to qualify the forecast made in the White Paper. Having given three alternative predictions, the lowest one being a growth rate of 1¾ per cent., he prudently included, on the assumption that the Chancellor will remain in office, the following qualification:
  "Case (c) is therefore far from being the lower end of the possible range of GDP growth if the rise in earnings is not kept down."
  In other words, "If you watch us performing, we will do a great deal worse than either of the examples contained in the White Paper."
  The truth is that with public expenditure running at its present level, the National Coal Board about to lose £250 million, the BBC coming cap in hand for a bridging loan to pay the schedule 11

  737
  pay increase, the Port of London Authority losing £1 million per day and British Rail losing £4 million for every strike day, if the present public sector pay claims in the pipeline are settled at 15 per cent., then, as the Prime Minister said, rates will rise by one-quarter and public sector borrowing by £2 billion.
  The truth is that the cupboard on which the claims are made is bare. In those circumstances, it is no wonder that we should be disturbed by the prospect of more public spending.
  The Prime Minister, the Chancellor and the Chief Secretary have all asserted the importance of maintaining control of the money supply and the borrowing requirement and the reality of cash limits. That has been underlined by the Governor of the Bank of England. My hon. Friends and I say "Hear, hear" to all that.
  However, there are two disturbing factors. First, when the Prime Minister announced last week an addition to the cash available for low-paid workers amounting to pay increases of £3·50 a week, he said that the Government will raise that sum by increasing the cash limits available to the rate support grant. More seriously, the Secretary of State for Employment gave a remarkable answer in the House on Tuesday—it was one of the rare occasions when we had the pleasure of seeing him here. He was asked by the hon. Member for Salford, East (Mr. Allaun) whether he would take note, in the light of the speeches made by the Governor of the Bank of England and the Chief Secretary to the Treasury, that their speeches, implying cuts in public expenditure, were completely unacceptable to the Labour movement. The Secretary of State replied:
  "I hope that my hon. Friend will accept that I am more likely to be guided by what he says than by the remarks of the two gentlemen to whom he referred."—[Official Report, 23 January 1979; Vol. 961, c. 187.]
  The Prime Minister (Mr. James Callaghan): The Secretary of State for Employment confirms that he said that, but he also says that he misheard the question.
  Sir G. Howe: I must say that the alibi witness was very quick in coming to his feet. However, it is more serious than
  738
  that and is not to be laughed off in that way.
  The Prime Minister: That is true.
  Sir G. Howe: It may well be true, but, true or false, it is still not a laughing matter.
  The Secretary of State for Employment may have mis-phrased that, having misheard the question, but it is nevertheless on the record and the House is entitled to a statement from the Secretary of State clarifying the position. The matter has been commented upon in the press, and for the sake of his own reputation the Secretary of State should clear up the matter.
  What I now ask is whether the Government agree with the Governor of the Bank of England and the urgency of what he says. What do the Government intend to do, and when? When will they discharge their duty of seeing that their fiscal policy and public expenditure patterns conform with the discipline they have set themselves?
  There is grave anxiety about those matters. Will they stand by cash limits? Will they ensure that the public sector borrowing requirement is kept within the targets set by the White Paper and, above all, in line with their monetary policy? My hon. Friends and I wish to hear from the Chancellor about these matters as soon as possible.
  Mr. Ron Thomas: A moment ago the right hon. and learned Gentleman mentioned the £3·50 that the Government have offered to low-paid workers who do essential jobs in the public sector. He poured scorn on that, referring to the public sector borrowing requirement and the increase in the monetary supply. Would the right hon. and learned Gentleman tell the House where the Conservative Party stands in regard to that £3·50 for low-paid workers in the public sector?
  Sir G. Howe: I shall return to deal with with that question when I consider what the Government themselves are doing. I remind the hon. Gentleman that when this possibility was first raised in the autumn, the Chancellor of the Exchequer said that it would be extremely dangerous to inject a further amount of that kind into the public sector borrowing

  739
  requirement. The Prime Minister also recognised that it would be dangerous to introduce a further flat-rate increase of that kind. This has further implications, which I will return to later.
  I turn back to the other cause of our difficulties—the scale of the present claims on a Treasury which is almost bare and the militancy with which the claims are being pursued. They owe nothing to the decision of the House to end sanctions. Nor do they owe anything to the assumption, to which the Government are now resorting in desperation that they are a consequence of the Conservative Party's determination to restore free collective bargaining.
  Our objective throughout has been the same as that enunciated by the Chancellor of the Exchequer in 1977. The Chancellor described it as a return to normal collective bargaining which he thought was inevitable after two years of tight control—and after three years all the more so. We have stressed the need to return to realistic and responsible collective bargaining.
  We are unclear about the curious position of the Government. If anything goes wrong in the labour market, it is to be blamed on the return to free collective bargaining. If anything goes right in the labour market, it is claimed as a success for the pay policy which is alleged to have been destroyed.
  In some ways we are getting the worst of both worlds. While the Government seek to defend pay settlements in line with cash limits, their intervention to raise the pay of the lowest paid by £3·50 a week is a creature of the residual pay policy. It poses a threat of serious damage to differentials higher up the scale. It also raises the difficulty, which has been noted by many already, of collective bargains that have already been struck being reopened.
  If the Prime Minister was serious in his intention to return to responsible and realistic collective bargaining, he should not have made that change but should have allowed negotiations to go on within the framework of the bargaining structure as it then was.
  The reality is that this is an inevitable consequence of the prolonged attempt to maintain too rigidly a pay policy that was
  740
  foredoomed to failure. The CBI and the TUC both said that it would not work. The policy was rejected the TUC conference and the Labour Party and was bound to end up in this way.
  The shadowy survival of sanctions did not prevent the last round of pay settlements from being 15 per cent. Nor did it prevent Ford, with massive publicity, from ending up with a settlement of 17 per cent. It is clear that our present position is in no sense a consequence of the acts of the Conservative Party but a direct consequence of the Government's mismanagement of the economy.
  Mr. Robert Mellish: I have been following keenly what the right hon. and learned Gentleman has said, and he has a right to be critical of the Government's stance on wages over the past few years. However, in the interests of the nation as a whole, surely the time has come for the Opposition to say how they would deal with existing wage claims, such as that of the lorry drivers. How would they settle that dispute?
  The public want to know the answer to that question. Are the Opposition saying that the lorry drivers can have whatever they ask for under the principle of free collective bargaining? If not, what is the right hon. and learned Gentleman saying?
  Sir G. Howe: The right hon. Gentleman has raised a matter about which the Government's position is totally obscure. If the Government are seeking to maintain a residual incomes policy and to condemn the present offer to the lorry drivers as excessive, as the Secretary of State for Transport did last week, but nevertheless remove the sanctions that existed—apparently as a means of opening the way for a higher settlement—the Road Haulage Association must be mystified about what the Government want it to do. Is the RHA to be condemned for resisting the strike or condemned for settling at a higher figure?
  The reality that we want to achieve—and this should be beyond doubt because my right hon. Friend the Leader of the Opposition has spelt it out clearly—is a return to realistic and responsible collective bargaining without Government interference. That means that the lorry drivers' claim should be handled as a

  741
  result of responsible collective bargaining in that industry without Government interference.
  As far as the Government are concerned, settlements should take place within the available cash limits. There is no escape from that. Labour Members may writhe and shrink from the reality of cash limits, but those limits represent a statement of the totality of the resources available in the public sector. If public expenditure is not to be increased beyond what can be afforded, the cash limits must be maintained.
  Mr. Gordon Wilson: Will the right hon. and learned Gentleman give way?
  Sir G. Howe: No, not at the moment. The country has learned that the side effects of an imposed incomes policy eventually become intolerable. On the other hand, as we struggle to return to collective bargaining free from Government interference, British-style collective bargaining, as conducted in the present day, seems almost equally intolerable.
  It is urgently necessary to begin reconstructing conditions in which responsible collective bargaining can take place. That means making significant changes to redress the balance of power in our labour market between the employer, the community as a whole, the ordinary citizen and the forces of disorganised labour as they are currently manifesting themselves.
  Almost everything that the Government have done has been designed to have, and has had, exactly the opposite effect. They came into office deliberately committed to a policy of withdrawing anything that might resemble a feature that balanced against the power of disorganised labour. The present Prime Minister and the Leader of the House were more committed than anyone else to a policy of appeasement of organised labour as the only way of achieving industrial peace and sensible collective bargaining.
  Mr. Robert Kilroy-Silk: Will the right hon. and learned Gentleman give way?
  Sir G. Howe: No.
  Mr. Kilroy-Silk: Give way.
  Sir G. Howe: No. I do not intend to give way. As a result of the changes made by the Government since they came into office, they have unleashed upon British industry and, in latter days, upon our social services a tiger of labour disorganisation which they are unable and still unwilling to control. In many cases, that tiger of industrial strife is being goaded by people, often a small minority, whose express purpose is the destruction of our economy and the overthrow of our institutions.
  Let me do the Prime Minister justice. I do not think for a moment that he expected or, still less, intended to bring about the state of chaos over which he presides. He represents a constituency in South Wales and my home is in that part of the country. Throughout my 20 years of practice at the Bar, I spent the greater part of my time representing trade unionists and trade unions. I know many of them well. Labour Members may laugh, but that happens to be a fact.
  I count many trade unionists among my friends and they know, as I know and as Labour Members know, that much of what is going on in industry and our social services is a corruption of everything that used to be regarded as best in British trade unionism. The Prime Minister has gone some way towards saying that, and I only wish that more of his colleagues, including, occasionally, some of those below the Gangway, would have the courage and decency to say something to the same effect. I wish that more trade union leaders were prepared to break their silence and condemn a great deal of what is going on. Unless they give that leadership, it will indeed be difficult to restore sanity and effectiveness to our trade union movement.
  We have reached the point where words are by no means enough. We need action to change the balance of power. The Prime Minister has explained many times why he is unwilling to take the necessary action of changing the law to bring about that change in the balance.
  We know that the law has traditionally not been employed in industrial relations. As for the City of London, so for the trade union movement until about 20 or 25 years ago, self-regulation was the order of the day. Until that time, it seemed

  743
  to have worked not too badly—not because there were no rules, but because there were rules which were observed and upheld without the intervention of the law.
  All those rules and safeguards and all that framework of order which held our industrial relations system together have been swept away and replaced by anarchy and coercion. That is an unacceptable position in a free society.
  In those circumstances, it is clearly the duty of the Government, with the support of the House, to take action, however difficult it may be, to restore a basic framework of order and to see that it is upheld. If that is not done, civilisation, as well as industrial relations, is in danger.
  Tens of thousands of our fellow citizens are being prevented from going about their lawful business and going to their daily work, even though they wish to do so and would be glad to do so for the wages that are on offer. When that sort of prevention is taking place, with the degree of coercion that we are experiencing, it is not trade unionism. It is tyranny.
  The reason why the rules and the law must be changed is that this state of affairs is a direct result of changes in the opposite direction made by the Government in legislation since 1974. They have done two things. First, they have removed all effective restraints on the establishment and enforcement of a closed shop. It was subject to some checks before their time, but those have been swept aside.
  Secondly, the Government have removed all effective restraints on blacking, sympathetic strikes, secondary boycotts and secondary picketing. The balance throughout industry has been totally transformed. The result is that in many industries, if not in all, no worker who challenges, questions or fails to obey a call for industrial action can, in truth, feel safe from the possibility of an industrial sentence of death. In many industries, no employer can feel safe from the risk of a total industrial and commercial blockade.
  A power has been created which can have the effect of destroying a man's livelihood or his business for ever. The fact that that power depends on what the Attorney-General, rightly or wrongly, described as "lawful intimidation" is no
  744
  comfort to the House. If it is lawful to threaten a man, in whatever courteous language, with the possibility of the withdrawal of his union card, that is an intolerable extension of the closed shop. It is absurd that a driver should have to determine the legality of that sort of threat on the picket line.
  More seriously, the Government, in face of present disputes, have accepted the legality and reality of those powers of coercion as a form of law and have handed over the regulation of many aspects of our society to that pseudo-law masquerading as law. The working lives and daily activities of many individuals and businesses are being regulated not by the law of the land, in whatever loan, but by groups of people acting, often, with an assumed authority and with all the arrogance, but with even less true authority, of an army of occupation.
  That is what the strike committees are effectively doing. The British people could be forgiven if they had begun to feel as though they were working no longer in Britain but in a kind of Vichy France, where power had been surrendered, where the Prime Minister and his colleagues still wore the trappings of power, and were still riding in their black Rovers, but where the real power had begun to reside elsewhere in our society.
  The rules which are being applied to many citizens have been made not by this House or by any agency of it but on a single sheet of paper from the Transport and General Workers' Union. The dispensations or licences, which can be torn up at will, do not come from this House. The Lord President of the Council at one time used to be a defender of parliamentary sovereignty. He used to denounce us for setting up lawful organisa decide whether to go back to work that beards At least, we did not transfer halt the power of Parliament to some labour-only sub-contractor over which we had no, control whatsoever.
  The whole enforcement of this pseudo-law rests in the hands of the local strike committees. For what purposes are these powers being used? There are many examples before us. I will give just two or three. They are being used to deny people who wish to take part in a ballot to decide whether to go back to work that

  745
  very right. I will give one example, from The Daily Telegraph of 15 January. It reported:
  "A secret ballot by 41 drivers at Kings Lynn, Norfolk, resulted in a decisive majority to return to work. Thirty-seven wanted to end the strike, three voted against and one abstained, When they told their employer…that they wanted to defy their union the company declined to take them back. Mr. Eric Kingston, chairman of the drivers' committee, said yesterday: 'The company feared reprisals.'"
  That is a dreadful state of affairs to find in this country. The examples are legion. I will give one from yesterday's newspapers. The House will have noticed that our country is now filled with growing private armies, some of them motorised and some not, of citizens seeking to assert their right to work. The 600 lorry drivers who drove down the M6 yesterday represent a sort of counter-army, reasserting their liberties, so far as they can. Drivers have been besieging the regional headquarters of the Transport and General Workers' Union, bearing the honourable name of Bevin House. Who would have thought, in Ernest Bevin's day, that some of his regional headquarters would be under siege by his union members who are seeking the right to be consulted? The convoy which came down the M6 yesterday was advised in these terms by one of the people leading it. As The Daily Telegraph reported, he said:
  "Do not be put off by threats. We are all in this together."
  The report went on to say that Mr. Arthur Drew and seven other drivers from Shepherds Transport Company joined the convoy,
  "ignoring the threats of a shop steward who said he would suspend their strike pay and 'black' them. Mr. Drew said there was a massive demand in the West Midlands for a return to work while pay talks continued."
  He added:
  "We are the union's prisoners because we need a union card to work."
  Has the great British trade union movement been turned into a system under which we gaol people who want to go back to work? But it goes further that, because it is not merely within the trade union movement that this tryanny is exercised. In the last debate on this subject, my hon. Friend the Member for Howden (Sir P. Bryan) spoke about conditions in Hull. The Sunday Tele-
  746
  graph carried a long report of the activities of the group of lorry drivers who form the strike committee in Hull. Is this not an extraordinary state of affairs in a free society?
  The town, it is said, suffers strong secondary picketing, despite central union guidelines, and is dominated by the rulings of this committee. There was a man seeking to import coffin wood into the borough of Kingston upon Hull. The company representative was brought in to give details about his request. He sat before the top table, as before a tribunal, and answered questions. The report goes on to say that
  "The request was granted in principle, but the man was told to return later to finalise details…Hull strike policy is that any place previously served by haulage men—even partly—should be picketed. This includes manufacturers, food warehouses and, of course, the docks themselves."
  To have the whole commercial activity of anyone who wishes to do business in Hull regulated by application to a committee, a group of trade unionists, sitting as though it were a tribunal, is a quite intolerable state of affairs.
  It is all very well for the Prime Minister to come to the House, as he did on Tuesday, and say boldly that he would strut with courage and freedom through a picket line. I dare say that he is now sufficiently well recognised and well known throughout the country, and sufficiently well protected, to be able to do so with a certain degree of confidence. But that is not how it is for ordinary people. It is not even how it would be, apparently, if he sought to present himself at Tilbury, for in today's Daily Mail one reads that a picket there who had read the Prime Minister's statement said:
  "I'd like to see what happened to him if he tried to cross this line. What James Callaghan says does not mean anything any more. I think next week everything will come to a stop."
  That is the reality, and everything that we heard this afternoon from the Attorney-General about the scope and lawfulness of picketing, be it secondary picketing or primary picketing, confirms our fears about the danger to individual liberty in this country.
  We heard the Prime Minister say, quite rightly, that to extort payment from people before granting them the right to cross a picket line was unlawful. It was,

  747
  he said, the crime of extortion. It is happening all the time. Constituents telephoned me about it during last weekend, and the stories come in all the time. This law is being applied as if there were some customs barrier, where people present themselves in their lorries and are told that they cannot pass unless they pay £X or £Y.
  The Prime Minister: Has the right hon. and learned Gentleman reported it to the police?
  Sir G. Howe: The whole language of Labour Members is to the effect that pickets have the right to stop people. The Prime Minister asks whether I have reported it to the police. I am sure that he knows that the pickets making these demands are unwilling to identify themselves or their authority. It is they who have the power to take the numbers of the vehicles being driven, and the power to trace by whom those vehicles are being driven.
  Let me put this to the Government, since they retain a residual responsibility for these matters. Whatever I should have done about reporting the incidents, may I ask whether the Prime Minister happened to see, on the front page of The Daily Telegraph last Saturday, the short report—the incident was reported almost as a matter of routine—which read:
  "Pickets impose salad 'levy'. Part of a 600-ton cargo of tomatoes and cucumbers from the Canaries was allowed to pass pickets at Liverpool Docks yesterday at a 'price'. The lorry drivers had to agree to give their pay to charity, the Liverpool Fruit Importers' Association to give £1,000 worth of the produce to pensioners and deprived children and the Mersey Docks and Harbour Board and importers each to give £1,500 to charity."
  I do not make any complaint about the charitable destinations of those sums of money, but I question very seriously whether those pickets at Liverpool docks have any right whatever within the law to extort payments of that kind. The Prime Minister nods agreement.
  The Prime Minister: Use the law.
  Sir G. Howe: The Prime Minister makes a very interesting observation. In the face of the facts set out in that report he says "Use the law". That is fine. That is a great injunction to get from the Prime Minister. I hope that he will ensure that the facts that I have drawn
  748
  to the attention of the House are brought as swiftly as possible to the attention of the Attorney-General, so that the matter may be investigated fully.
  If these changes are taking place and the balance of authority in our society is changing, the complaint that should be made is not by the Government about the effect of free collective bargaining but by the people of this country about the effect of unbridled collective mugging.
  The Prime Minister: The right hon. and learned Gentleman said that he had a number of complaints from his constituents about intimidation. [HON. MEMBERS: "We all have."] In that case, all hon. Members share the same responsibility. Has the right hon. and learned Gentleman reported any of these cases to the police? If he has not done so, will he please do so? I will draw the attention of the Attorney-General to what the right hon. and learned Gentleman has read out. But if the position is as the right hon. and learned Gentleman has given it, he too has a responsibility, as a citizen, to report these matters and to try to put them right.
  Why should we pick a quarrel between both sides of the House about the upholding of the law in these cases, which are totally improper, for which there can be no defence? It is weakening the total attitude to the law if the right hon. and learned Gentleman suggests that it is the Government's responsibility to do this. He knows very well that it is the responsibility of the police to take action if these matters are drawn to their attention, and they should do so.
  Sir G. Howe: I must say that I am not in the least surprised at the manner in which the Prime Minister has sought, as it were, to lay the blame for non-enforcement of the law on individual Members of this House. The reality is being reported in the papers day after day. It is a matter of common knowledge in this House and elsewhere that trade union pickets, be they lawful or unlawful, are demanding sums of money before people can cross picket lines up and down the country, like an informal set of customs officers. If the Prime Minister is seeking to shuffle off his responsibility, the Attorney-General is the senior Law Officer of the Crown—[HON. MEMBERS: "Sit down."] The Attorney-General is the senior Law Officer of the

  749
  Crown. It is the function of the prosecuting authorities to investigate matters of this kind, certainly if they are a matter of public concern, as soon as they come to their knowledge. If the Prime Minister has had to wait until today to have a word with the senior Law Officer and ask him what he is doing about this, it is a very sad commentary.
  Mr. Peter Emery: My right hon. and learned Friend has been atacked by the Prime Minister about hon. Members who have not reported cases. I have reported a case. I gave the exact facts to the Home Secretary on the Floor of the House on Monday evening, having drawn the attention of the House to it at Question Time. I have actually contacted the individuals, who are willing to give evidence and to stand up, and I actually have the names of the trade union officials concerned. But at 2.30 p.m. today nobody had bothered, as far as the office of the Home Secretary is concerned, even to contact those individuals to see what inquiries should be made. So it really is not any good—[Interruption.]
  Mr. Deputy Speaker (Mr. Oscar Murton): Order. Charge and counter-charge do not help the House. Could we have a little order?
  Mr. Mellish: On a point of order. The matter that has just been referred to in that altercation in fact came up today at Question Time, and it was made abundantly clear that the police had been informed at the time and it was a matter for their action. Nothing of that kind was said, and it is important, if we are to have a sensible debate, that people at least try to tell the truth.
  Sir G. Howe: We want to conclude this matter, as far as I am concerned, on a note which I hope represents some common ground between us. We have established now beyond doubt that this kind of practice is beyond the law and that each and every citizen who is required to face any kind of demand when exercising his lawful rights in this way is entitled to complain to the police and the prosecuting authorities, on the Prime Minister's authority and certainly on mine. Let that be clearly understood, and let us begin to re-establish the rule of law in this country.
  The Prime Minister: I only want to make it clear that, as this case had been referred to the Home Secretary, the Home Secretary passed on the information to the chief constable of the area concerned in order that he might consider whether action should be taken. Every member of the Government would take the same line. But I suggest to the hon. Gentleman, and indeed to any hon. Gentleman, that he should go to his own chief constable about such matters. There is no point in going to the Home Secretary, who can only pass it on. He cannot instruct a chief constable to start a prosecution.
  Mr. Emery: As a matter of explanation, the Prime Minister is quite correct. It this had happened to a constituent of mine in the area of my own county, of course I would have gone to my own chief constable. But, because it was outside my own county I drew the matter to the attention of the Minister concerned and the Minister asked me to refer it to the Home Secretary. So it was referred to the Home Secretary at the request of the Secretary of State.
  Sir G. Howe: I must say, Mr. Deputy Speaker, that, having started my speech in the midst of a flurry of Standing Order No. 9 applications and having finished in the midst of a sort of mini Adjournment debate between the Prime Minister and my hon. Friend, I wish now to come to a close. But I must say this: we shall not be able to restore order or even humanity to our society until effective action has been taken to prevent gross abuse of power of the kind we have been talking about. People are entitled to look to the Government and the Parliament to restore their freedom.
  My right hon. Friend the Leader of the Opposition has made four suggestions which deserve continued serious examination: that the secret ballot should be more widely used; that the rights of pickets should be more closely defined; that we should examine whether it is possible to find areas where the right to strike could be traded for something else; and, finally, and most important of all, that the powers conferred by the unregulated closed shop should be re-examined.
  The Government, in their amendment, invite the House to support their determination to do these things, but the Government remain unwilling to take any

  751
  action on these matters. We on this side of the House—I include those on the Benches occupied by the Liberal Party—have no doubt about the necessity for such action. Many hon. Members on the Government Benches, I suspect, recognise the same thing, but the Prime Minister himself is almost alone in saying so, and he is doing nothing. If he were prepared even now to invite his Government to act on these things, if his party would allow him to take any action on these things, he could count on our support. But if, like the right hon. Member for Huyton (Sir H. Wilson) before him, he is unable to persuade his colleagues to do what he knows to be right, he should give the people a chance to choose a Government that will do what is right.
  6.48 p.m.
  The Chancellor of the Exchequer (Mr. Denis Healey): I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:
  "recognises the deep concern felt throughout the country about the current industrial situation and supports the Government's determination to maintain essential supplies, control inflation and protect the supreme interest of the community and the legitimate rights of all sections of it."
  When the right hon. and learned Member for Surrey, East (Sir G. Howe) began his remarks, I had one flicker of hope that he intended to address himself to the real problems facing the nation. Instead, we had the same stale old party claptrap trundled out that he has given us on every occasion in the last five years to induce catalepsy in his audience. The one thing that he did was to betray an uneasy sense of guilt when he was asked about his own party's responsibility in opposing any form of pay policy and withdrawing the sanctions that the Government had been able to use for the past three years for the present situation on the pay front.
  The only positive suggestion that he was able to make—we have had this before from him—was that we should solve all the problems that we face on the industrial front, in terms of pay and inflation, by restoring the Industrial Relations Act as he introduced it when he was Minister in the last Conservative Government—the Act that failed to achieve any of the objectives that he set for it, which was described by the Director-General
  752
  of the CBI, during the election campaign, as being responsible for souring and sullying industrial relations and which was described by his right hon. Friend the Member for Lowestoft (Mr. Prior) only the other day as being not a conspicuous success. I shall return shortly to that element of the right hon. and learned Gentleman's speech.
  I believe that it is right, as both the Opposition motion and our amendment suggest, that on this occasion, after spending many hours in the last few weeks discussing the difficulties that the British people have had to endure as a consequence of the present industrial disputes, we should spend some time today directing our attention to the economic consequences of what has happened so far and to the implications for our economy if the present trend continues. I think that the House would expect me, as Chancellor of the Exchequer, to deal in particular with the implications for the Government's fiscal and monetary policies.
  I believe that in some areas the human consequences of the present disputes are intolerable, but so far the strictly economic consequences have been far less dramatic than many people expected. For example, when the lorry drivers' strike began unofficially about three weeks ago, most industrialists believed—genuinely, I think—that if it continued as it had begun there would be 1 million more people out of work by the end of last week. [An HON. MEMBER: "The right hon. Gentleman said that."] Yes, I quoted these estimates. Of course I did, because there is no one from whom the Government can obtain information about the industrial consequences of industrial action except from the industrialists themselves.
  The Director-General of the CBI said that the figure could be as high as 2 million by the end of last week. In fact, however, a fortnight after the strike was made official, nearly three weeks after it began, about 200,000 people have been laid off as a result. That is an unacceptable figure, but it is barely one-fifth of the number laid off in the three-day working week. The House must recognise, in the light of earlier exaggerated estimates, that the attempts by the Transport and General Workers' Union to limit the disruptive effects of the lorry drivers' strike though far from totally effective in man

  753
  areas, have served somewhat to reduce the damage caused.
  The effect on output has been small, and it is likely to be made up quite quickly. The same is true of the effect of what has happened so far on the nation's financial situation. For example, so far as the Government can discover—our findings are broadly confirmed by the CBI's databank—all breaches of the guidelines up to and including the offer of 15 per cent. to the lorry drivers are unlikely to add more than ½ per cent. to the earnings outturn over the year as a whole as compared with what it would have been if the guidelines had been strictly observed.
  Similarly, the inflationary effect of breaches of the pay guidelines so far and the industrial disruption so far, taken together, are likely to have added scarcely anything to the public sector borrowing requirement this year. The Government are already well ahead in funding the PSBR. By mid-December, over a month ago, we had already sold £5·1 billion of central Government debt outside the banking system.
  So far I have been describing the effect of what has happened up to today. The problem to which the House and the country, and, above all, the trade union movement, must address themselves, however, is what are likely to be the consequences if some of the recent settlements in the private sector prove to have established a new level of expectation in the economy as a whole.
  Mrs. Elaine Kellett-Bowman: The right hon. Gentleman said that the effect on output was small. However, the point is that in the North-West, in my constituency in particular, the effect on exports has been absolutely catastrophic. Firms are absolutely choking. They are keeping up their output to a certain degree, but they are choking because they cannot get it away. They are losing orders right, left and centre.
  Mr. Healey: The hon. Lady is quite right. There has been a very serious delay of exports at many ports. Of course, if that continues for any length of time the consequences are bound to be found in lost orders, even when the current exports have been moved away. I do not for a moment deny that. This is one of the
  754
  more serious immediate aspects of our current problems.
  However, as I say—I stick to what said—the effects of what has happened so far are likely to be made up quite quickly if the industrial troubles come shortly to an end. But the problem to which we must address ourselves is what will happen if some of the recent settlements become a new going rate, as is sometimes said—if, for example, the tanker drivers' settlement began to be taken as the going rate, as I see one trade union leader asserted that it should be taken the other day. That is the danger that the nation must now face, which it is not yet too late to avert.
  I think that the only way that I can demonstrate the dangers is by making a gloomy and, so far, unjustified assumption for wholly illustrative purposes. I stress that this is an assumption that I do not endorse—indeed, it is one that I think it must be the objective of all of us in the House to disprove. Let us assume, for example, as some pessimistic forecasters in the City are already beginning to predict, that the increase in the nation's earnings in the current pay round is as high as 15 per cent.—an outturn that some people seem to contemplate with equanimity as a reasonable one, because it is roughly the same as the outturn last year.
  They are quite wrong if they think that that is reasonable. The most obvious and inevitable consequence of this assumption coming true would be that the year-on-year increase in the rate of inflation would move into double figures in the summer of this year and would probably reach about 13 per cent. by the end of the year. So we would be back, on inflation, to where we were in 1976. We would have lost al: the ground that we have gained in the fight against inflation in the last three years.
  A 15 per cent. earnings increase would also create formidable problems for the Government's fiscal and monetary policy. The present Government have made it clear that they are not prepared to finance inflation by printing money. I reassert that determination today. We shall stick to the monetary policy which we have already announced. We shall not accommodate excessive wage increases in the public sector by increasing cash limits accordingly. My right hon. Friend

  755
  the Prime Minister has made it clear on several occasions in the House that the present Government will not finance inflation. Others of my hon. Friends have pointed out to some of those concerned in particular disputes the meaning of that. My right hon. Friend the Secretary of State for Transport, for example, made it clear the other day that he does not intend to finance excessive pay increases in the railways out of taxation. This will be true of the other nationalised industries.
  I believe that it is, above all, because the financial markets have confidence in our determination here that sterling has remained strong through all the current troubles. I see that the hon. Member for Oswestry (Mr. Biffen) agrees with me. The Government are determined to maintain the monetary policy to which they have pledged themselves and the fiscal policy implied by the monetary policies.
  I have made it clear on many occasions that I do not think that fiscal and monetary policies alone can control inflation even at the cost of heavy unemployment. That is where I disagree with some right hon. and hon. Members of the Opposition. There has to be moderation in pay settlements, too, however that moderation is achieved. I know that there are differences on both sides of the House on the question whether the sort of pay policy that we have had in the last few years is the right sort of approach to moderation in pay settlements, but I still believe that it is not possible to control inflation by fiscal and monetary policy alone, without moderation in pay settlements. I also believe that if we were to add to the difficulties that we now face on the pay front by the abandonment of our fiscal stance and of our monetary targets, all our problems would immediately be made very much worse.
  On the assumptions that I have just described—which, I stress again, it is not too late to prove mistaken; indeed, I am describing the risks only, I hope, to strengthen the resolve of everyone in the House and outside to avoid them—that there will be a 15 per cent. increase in earnings in this pay round, it is already possible to make a very rough and ready estimate of the problems which the Government would face in the spring Budget. If we take the new public expenditure White Paper as a base, the effect of the
  756
  pay and price increases following from a 15 per cent. earnings outturn would be to increase the cost of the services which central Government are planning to provide by over £1,000 million in the next fiscal year, to raise the cost of local authoority services by another £1,000 million and to raise the costs of the nationalised industries by only a little less—about £3 billion in all. However, on the assumptions that I have given, the effect on the public sector borrowing requirement would be considerably less—perhaps under half as much—because of the extra tax revenues generated not only by public sector pay settlements but by settlements in the private sector.
  Faced with such increases in expenditure and in the public sector borrowing requirement, the Government would be compelled to seek reductions in the volume of public expenditure. As I told the hon. Member for Blaby (Mr. Lawson) recently, I do not intend next year to have a PSBR higher than that estimated in the public expenditure White Paper for the coming year.
  The consequences on public services could be severe. I have already pointed out to some of those who are involved in the negotiation of a settlement for local authority manual workers, for example, that if all local authority workers got a settlement of 15 per cent., there would be 100,000 fewer people at work in local authorities than now, unless local authorities were prepared to finance these increased wages with a doubling of the present average rate increase from 10 per cent to 20 per cent.
  Mr. Ron Thomas: My right lion. Friend raised the question of the tax revenue that the Government would get back whatever the percentage increase—whether it be 15 per cent. or some other figure. For the purposes of his argument, he was envisaging 15 per cent. Given a 15 per cent. increase in both the private and public sectors, how much would come back in income tax and indirect taxes? Would it be 45 per cent. of that total? Most people, given their wage increase, would be paying 33 per cent. on that increase anyway.
  Mr. Healey: It is difficult to make that calculation. Even when one has done so, one is liable to be mistaken. For example, one has to take note of the pattern of

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  spending—how much goes on goods subject to specific duties, how much goes on value added tax and how wage increases are distributed between one level of earnings and another. The broad brush picture which it is fair to give to the House is that, assuming that the increase generated in expenditure were £3 billion, there would be a much smaller increase in the public sector borrowing requirement—perhaps only half or even under half as much—as a result of the tax revenues flowing in from the larger settlements on both sides. But to estimate this exactly in advance, as the House knows—and as I know to my cost—is impossible. It cannot be done. It depends on the savings ratio and a million other things.
  I have already given the example of one group of workers. I turn now to the problem as it affects public expenditure and Government finances as a whole.
  To some extent, the reduction in the volume of public expenditure would follow automatically from the cash limits which will reflect the Government's pay guidelines when they are published in a few weeks. But there are bound to be some areas where that would be impossible without unacceptable disruption. For example, we cannot cut the number of people paying out social security benefits because there happens to be an increase in wages in that area.
  To the extent that reductions in volume were not brought about automatically by sticking to cash limits in the programmes concerned, they would have to be met by other cuts in public expenditure or by larger or earlier increases in the prices charged by the nationalised industries to cover their cost increases. The only other alternative is to raise taxation.
  Some increases in taxation would be necessary in any case since some public expenditure programmes are open-ended and cannot be subject to cash limits—for example, social security programmes. Moreover, it would be unfair to burden the public sector with the sole responsibility for offsetting excesses which had occurred no less in the private sector.
  Nevertheless, it would be impossible to achieve fiscal justice against the background of excessive pay increases on the
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  scale that I have assumed. For example, it would be immensely unfair to those—at least 1 million—who have already made settlements within the Government's guidelines and would in any case have to face the inflationary consequences of others' excesses if the Government had to increase tax as well. But it is not easy to see an alternative.
  I wish that the Liberal Party were right in believing that it would be possible in Britain to use the income tax system to recover excessive pay increases from those who had negotiated them. But, after repeated examination, I believe that under our pay-as-you-earn system it would not be administratively possible to do so.
  Mr. Peter Tapsell: accept everything that the right hon. Gentleman has been saying in the latter part of his speech, but does it not underline his great unwisdom in allowing public expenditure to rise so much in the past two years that he has boxed himself into the position that he is now describing?
  Mr. Healey: No. First, the increase in public expenditure planned for next year in volume terms—I disagree with the hon. Member for Blaby on this point—is only just over 2 per cent. as against actual expenditure.
  Mr. Nigel Lawson: That is too much.
  Mr. Healey: This is the difference in philosophy between the two sides of the House. Even if we cut, let us say, £3 billion of public expenditure, the essential fiscal and monetary consequences of excessive pay increases would be much the same and the need for further reductions in public expenditure would remain.
  All that I have been describing is only half of the result. If this round were to produce an earnings outturn of 15 per cent., the Government would have a duty to limit the damage caused to our economy by sticking to their fiscal and monetary policy. That would inevitably mean an increase in unemployment and a reduction in the standards of public services without producing any increase in real take-home pay. This is all on top of the loss of jobs in the private sector where excessive settlements are bound to price some people out of jobs, to bankrupt

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  some of the firms which have agreed them and to make it likely that any new investment which takes place will be intended to reduce, not increase, jobs.
  Dr. Jeremy Bray: On the assumptions defined by my right hon. Friend, including maintaining monetary and fiscal policies, can he say what effect the rate increases that he suggested will have on unemployment?
  Mr. Healey: No, I cannot. Indeed, as I have often said in the House, the most difficult thing in the world to predict at present is the effect on unemployment of measures that the Government take. As my hon. Friend knows, last year we had a fall of over 100,000 in unemployment when most economists were predicting a substantial rise. What is certain, however, is that the effect on jobs would be very severe and unwelcome to all, I think, on both sides of the House.
  There is a final irony. No one who finished up in these circumstances with a 15 per cent. increase in earnings would be any better off than if he had stuck to the Government's pay guidelines, because he would have been paid the difference in confetti money. The advantage that he thought he was gaining would be swallowed up in higher prices and taxes before the year was out.
  I cannot believe that is what the champions of free collective bargaining really want. I think perhaps that is the only partisan remark I may be held to be making at this point in my speech.
  A heavy responsibility for the risks that we now face lies on all those who have contributed to the present situation by undermining the Government's pay policy and lauding the advantages of totally free collective bargaining in a free market.
  Mr. Michael Latham: Will the right hon. Gentleman give way?
  Mr. Healey: Perhaps I may continue. I have given way quite a lot.
  The point is that it is not too late to call a halt. I believe that a halt will be called only if all those concerned on both sides of the bargaining table are brought face to face with the consequences of their actions. I am seeking to bring them face to face with the consequences this afternoon.
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  If I have a complaint to make about the right hon. and learned Gentleman's syeech, it is that the only suggestion he put forward for dealing with the risks we run on the pay front was based on the belief—a belief that I am sure he holds sincerely—that all our difficulties in collective bargaining are due to some gargantuan increase in the rower of the trade unions brought about by the Labour Government. However, the fact is that the last Conservative Government faced exactly the same problems when they possessed all the powers which the Conservatives now ask us to adopt. All the evidence of history is against their arguments. [HON. MEMBERS: "No."] I hope that the Opposition will listen. They may disagree with me, but I ask them to look at the evidence.
  The right hon. Lady the Leader of the Opposition in her television address the other night asked us to offer the unions financial support for secret ballots. I do not deny that there is a case for doing that, but, as the right hon. Member for Lowestoft pointed out, the result of that would not be necessarily what the Government or the employers might always want. In fact, it might quite easily be the reverse.
  On the only occasion when the Conservative Party used this power when last in office, under the Industrial Relations Act introduced by the right hon. and learned Gentleman, the railwaymen voted by a huge majority for a strike. The same thing happened only the other day in Manchester when the busmen voted for a strike by secret ballot. I do not deny that a secret ballot could help in some situations, and I believe that it is a democratic procedure which I wish were adopted more often, but there is no reason in history or in any evidence—and much evidence has now accumulated—that it would produce any net advantage in solving industrial disputes.
  Sir Geoffrey Howe: I should like the Chancellor and the House to be clear about what is being discussed. My right hon. Friend the Leader of the Opposition is not putting forward a suggestion for a selective, statutorily required ballot of the kind set out in the 1971 Act; she is merely proposing that there should be wider use of the ballot—publicly financed in certain cases, if necessary—at the

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  option of the membership. To some extent, therefore, there is common ground about the desirability of that happening.
  Mr. Healey: I well understand that the proposal is not to restore the position as it was under the Industrial Relations Act, although the right hon. Lady suggested something that would look to Labour Members very much like support for statutory sanctions—namely, that social security benefits should be denied to those who took industrial action without availing themselves of this voluntary opportunity. This afternoon we talked of intimidation. I should like to know what would be more intimidating than that.
  I am glad that the right hon. and learned Member did not repeat that suggestion this afternoon, or the general sugegstion put forward by the right hon. Lady that the families of strikers should be denied social security benefits. She was said to have argued against that proposal when it was put forward in the last Conservative Cabinet on a brief provided by the right hon. Member for Leeds, North-East (Sir K. Joseph). If so, she was very wise at that time, but I am sorry that she has forgotten the arguments to which she was then sensible.
  I am also glad that we have not heard a peep out of the right hon. Lady in the last nine months on the idea that she advanced on television last year about solving all these problems by having a referendum every time there was an industrial dispute. The way in which the right hon. Lady bobs about from one bright idea to another does not give one very great confidence in the firmness of her commitment to any of them, or indeed in her real conviction that any of them will help.
  Mr. Michael Shersby: Will the right hon. Gentleman cast his mind back to the Vauxhall dispute last year, when a young man stood up in front of the crowd of employees outside the Vauxhall factory and, despite his being almost hauled from the platform by shop stewards, persuaded those men not to go on strike? That man was being intimidated. What my right hon. Friend was talking about was the right of those men to cast their votes in secret and in a democratic manner on the question
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  whether they would withdraw their labour. That is what we want.
  Mr. Healey: I understand that situation very well. I am merely asking the House to ponder the truth of the evidence. The evidence points to the fact that there is no guarantee that secret ballots will succeed.
  I admired enormously the young man mentioned by the hon. Gentleman. In common with others, I watched that incident on television. We are all subject to intimidation from time to time. I have had the experience at Labour Party conferences of being substantially intimidated by my colleagues. I am glad to say that the Conservative Party has never succeeded in intimidating me in that way in this Chamber. It is often unpopular to argue a good cause, and people have to show some courage in doing so. But if violence or the threat of violence is used, it is the duty of the police to intervene.
  The right hon. Lady asked the Government to use the law to control picketing, but, as my right hon. and learned Friend the Attorney-General pointed out this afternoon, the law has already provided the State with all the powers that it can use in this regard. The right hon. Member for Lowestoft went no further in his keynote speech as Shadow Minister for Employment in Huddersfield the other day than to say:
  "The next Conservative Government will reaffirm the existing law which should be upheld by everyone. We will also seek to obtain widespread agreement on a sensible code of conduct."
  That is a wise approach to the system, and it is the Government's approach.
  At the request of the Government, the TGWU has already issued a code of practice for its own pickets, which is having some but not total effect. My right hon. Friend the Secretary of State for Employment is discussing the development of a more general code of conduct on picketing with the TUC as a whole.
  It is true that the last Conservative Government gave themselves the power to take further legal action against pickets in certain circumstances. But the only occasion on which they ever used the force of law against pickets was a disastrous and humiliating failure when the Official Solicitor had to send to Pentonville prison to release the men concerned.

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  There was a similar experience in the wartime Government in the case of the miners at Betteshanger.
  The Opposition complain that we amended the law which they introduced in this respect, but the fact is that they had exactly the same experience with their legal powers on secondary picketing when they were last in Government. Secondary picketing was first established in the form we know it today in 1972, a year after their Industrial Relations Act, had come into force to prevent it. The Opposition took a firm decision not so long ago not to restore the Industrial Relations Act, and it is not surprising that the right hon. Member for Lowestoft described it on television only a fortnight ago as not a conspicuous success.
  The fact is that there is no answer to this problem which does not involve the Government co-operating with the trade union movement to try to secure that union power is used with more regard for public interest. We must do that and we are beginning to do it. The insensate and uncontrolled hostility to the idea of trade unionism which is displayed by so many Conservatives on Front and Back Benches would make such discussions particularly difficult—not for all but for some of them.
  The right hon. Member for Lowestoft—I am glad that he is not here to blush when I quote him so often—was right again on this matter. On the BBC on 8 January he reinterpreted his leader's new industrial proposals by saying:
  "It was not our intention to go for a whole range of legislative change but to approach this quite gradually, and to approach it in a form of embracing union power rather than trying to defeat union power."
  Those are his words and not mine. I doubt whether I would have been quite so incautious in my choice of verbs. Nevertheless, the Leader of the Opposition's approach to the problem, as defined by her employment spokesman, is to embrace union power and not go for a whole range of legislative change. How wise he is! How regrettable that—temporarily no doubt—his influence in these matters seems to be eclipsed on the Front Bench opposite!
  Mr. Malcolm Rifkind: When the Chancellor dismisses the need for any legislative form whatsoever, is he saying on behalf of the
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  Government that they are content to leave it to strike committees to be the ultimate arbiters of the question whether persons or goods shall pass between pickets and the factories to which they wish to go?
  Mr. Healey: The courts can decide, as was made very clear. I was very interested to notice that the Shadow Attorney-General, who asked the first questions of my right hon. and learned Friend the Attorney-General this afternoon, did not choose to intervene later in support of any of the points made by his hon. Friends on the Back Benches. That was because he knows perfectly well that the legal situation is as my right hon. and learned Friend the Attorney-General defined it and that it is not possible to escape from difficult questions of judgment in deciding what type of picketing is lawful and what is not. Everything must depend on the circumstances.
  We had discussions, for example, about the closed shop and about the threat of being expelled from a union being intimidation. Threats of expulsion from different bodies often play a role in our political life. Winston Churchill had the Whip withdrawn by the Conservative Party in the 1930s. [HON. MEMBERS: "Never."] I am sorry; he changed his party twice. Perhaps I am wrong about him. But the Whip has been withdrawn from Members on both sides of the House. It is a serious penalty. There are many situations in which membership of bodies can be withdrawn by the governing corpus in a way which constitutes intimidation but which may not be illegal intimidation. Everybody on both sides of the House must know that.
  It is precisely because it is so difficult—I know both parties have tried it at different times—to find a useful role for changes in the law to improve this situation that my right hon. Friend the Prime Minister has accepted the request of the general council of the TUC to meet him on Monday to discuss how we can together best find a way out of the troubles which the British people have been suffering from in recent weeks, and the even greater dangers that still he ahead. That is why all Ministers are in constant contact with the leaders of our trade union movement, not just on pay disputes but on all the issues which are of common concern.

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  We know that pay is not the only cause of inflation, but it is an important cause. We have no objection to big pay increases if they are fully earned by increases in productivity. We are trying to increase productivity throughout industry. We have been discussing it with the trade unions and the leaders of industry for three years in the industrial strategy and we want to continue discussing how we can help. But I am bound to tell the House that there have been too many cases recently where settlements have been reached way beyond the Government's guidelines and those concerned have not accepted any undertaking to increase productivity in order to pay for them.
  I do not believe that we can go on in that way. I believe that the Government are right to seek to reach a voluntary agreement with the trade union movement, because nobody has succeeded in persuading me that there is any other way of finding a solution to these problems. We must find a solution to the question of the way in which the trade union movement uses its powers in industrial disputes. We must seek to avoid some of the abuses by small minorities in disputes, abuses which the general secretary of the TUC rightly criticised the other day.
  We have, I believe, already made some progress in this connection in the code of practice, though there are many areas where we have not made progress. However, nobody can deny—least of all those who were telling us that there would be malnutrition throughout the country, that there would be starvation and that we would have 2 million unemployed—that the code of practice now being brought into operation by the Transport and General Workers' Union has reduced, though it has not yet eliminated, some of the abuses that I was discussing.
  We must also develop the commitment that we have already made, with the TUC, to reach an annual agreement on the desirable course of pay and prices in the coming year. I know that the Opposition Front Bench and the CBI also agree with this objective. We must see whether we can extend this type of agreement over a longer period with the target of getting inflation down to an acceptable level, which would certainly be a much lower level than that at which it stands today.
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  Most important of all, I believe that we must persuade the trade union movement to pause and reflect before moving further towards the precipice over which we so nearly stumbled only four years ago. We must find some way of reducing the current expectations of grossly excessive pay increases—expectations fed not only by some breaches already made but also by the rhetoric of some hon. Members and many people outside who have promised an earthly paradise out of free collective bargaining and have pursued the case against any sort of responsible pay policy.
  I know that it will not be easy. It was not easy in 1975 or 1976. But we did it then by reasoning together. We saved our nation from catastrophe, and we can and must do it again.
  Mr. Deputy Speaker: Before I call the next hon. Member, I must draw attention to what I think the House already realises, that the debate on the first Order of the Day—Supply—did not begin until 5.59 p.m. I make a special plea, there fore, on this occasion to hon. Members to speak for 10 minutes only, in their own interests and in the interests of the Chair, which has to maintain some balance. If this were done we could manage perhaps nine Members before the time for the winding-up speeches.
  7.28 p.m.
  Mr. Charles Morrison: I do not make a habit of speaking in economic debates. I speak today solely because I think that this debate is as much about national strategy as it is about economic policy.
  I entered the House in May 1964. Since then our country's performance has been one of steady deterioration, broken only by brief periods of raised hopes which only too soon have been dashed to the ground once again. In comparison with other countries, our performance has been at best inadequate and often abysmal. Apparently it is our turn in history to be the sick man of Europe.
  Therefore, it is not the least surprising that the British people are in a mood of disillusionment and frustration, probably such as never before. There is little or no confidence in the future, and less in the ability of national institutions to overcome our malaise. Dissatisfaction is immense and manifest in many ways,

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  but clearly above all at present in the current wave of industrial unrest.
  Of course, it is easy for me to say that the trouble stems simply from the fact that we have had a Labour Government for 11 of the past 14 years. I believe that to be a major part of the trouble, but it is by no means all of it. What is to be done? There was a report in one newspaper yesterday on the Government's annual report for 1979: 4 per cent. real economic growth, unemployment rate to decline to just under 4 per cent., an inflation rate of 3 per cent. The Economics Minister told a press conference that he expected no miracle. The country was West Germany. That type of performance may be no miracle to Germany, but for us it would be Heaven on earth. Yet that kind of performance is what is required if we are to restore our pride and self-respect and regain confidence in our future.
  What is to be done? As a country we certainly must do better. I want to emphasise three requirements that I believe to be paramount among many.
  The first requirement is the obvious one of economic expansion. I do not think that anyone will disagree that if we are to have it we must have more incentive and less direct taxation and more encouragement to investment, and that also requires more confidence. To say that is, for all Conservative Members, to state the obvious. Would that that were so for all Labour Members. They will have to learn, as never before, that it is not so much that you cannot have your cake and eat it but that you cannot have your cake unless you actually make it.
  The second requirement is more controversial. It is a policy for incomes. I wish that it were not necessary, but I believe it to be unavoidable, for two reasons. First, I think that it can play a major part in the restraint on expenditure to which the motion refers. Cash limits and monetary policy alone are not enough. Few people who want more pay know or care about the existence of the former and fewer still comprehend the latter.
  Secondly, in my view Governments are elected not least to reconcile what at first sight seem to be irreconcilable interests, to act as a referee. Given that, as the Chancellor pointed out, wage increase
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  expectations are invariably in excess of what can be afforded. If someone is not to get hurt or if many are not to lose their jobs, the Government must try to ensure fair play for those with no bargaining power. If incentive is to be maintained, those people are not exclusively the lower paid, although the claims of the lower paid are undoubtedly most justified.
  The third requirement is the most fundamental, perhaps the most controversial, and certainly in my view the most necessary if we want permanent and not merely temporary solutions. It is a degree of reform of our political system.
  I am convinced that the problems of our country are not capable solely of economic solutions. They need a political solution, but I doubt whether our system or this House in the form in which they exist today can consistently and continually provide it.
  We are very properly loth to make constitutional changes or to discard the form and characteristics of this House, as we know them so well. But for too long our system has failed to provide a basis for adequate and acceptable government. It is no use pretending otherwise, so change we must have. Without change in this House, I have no hope of a restoration of the authority of Parliament, to which the motion refers, or of consistent and continuing political and economic solutions to our country's problems.
  7.34 p.m.
  Mr. R. B. Cant: I have risen to address the House on a number of occasions in the past 12 or 13 years when only a handful of us have been present, but I think that to be the solitary representative of the Government Back Benchers is unique. I can only assume that the class struggle must be going on elsewhere, perhaps upstairs. I shall do my best to support the Government.
  One of the interesting things that has been referred to already is that the period through which we are living comes at the end of what was without any doubt the fastest period of growth in real disposable income this country and its people have known since the end of the war. It was nearly approached in that period of "We've never had it so good" around 1959. but the 8½ per cent. increase in real disposable income is something that

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  we certainly have not experienced in a long time. It is rather paradoxical that we now have more turmoil, "aggro", call it what one will, than ever before and that people are questioning whether the country is really governable.
  Certain disparaging references are made to North Sea oil. There is no doubt that, whatever grand designs we have had, or that certain members of my party have had, for using North Sea oil for the regeneration of British industry, a good deal of it is going on the import of candy floss, although a good deal is also going on the import of machines. All that is for real—an increase in our living standards.
  I am not a supporter of incomes policy. I am also not a sponsored Member. I have no obligation to any organisation to put up my hand this way or that.
  As Samuel Brittan pointed out in an interesting article this morning in the Financial Times, we face a profound imbalance in our society. One aspect of that imbalance has been shouted about at great length in the House this afternoon. I refer to the alleged relative growth in trade union power. I do not want to discuss that. I merely make the comment, by the way, that I have never tried to explain any phenomenon by means of reference to something that I regard as a relative constant. If one is trying to explain why an upheaval has taken place, one must look at the things that have changed, not at those that have relatively speaking remained the same.
  Therefore, we come to the second imbalance to which Samuel Brittan referred, the imbalance that has taken place in the whole area of rewards to different kinds of workers. That was graphically illustrated in The Guardian yesterday, where we saw what had happened to different kinds of workers during the period for which the present Government have been in office, from 1974 to 1978. Workers' incomes were expressed over that period in terms of a percentage of the average income enjoyed. There was an interesting little diagram, which taught me something. It showed why so many workers are worrying about the absolute size of their incomes but are also now worrying perhaps even more about the relative size of their incomes compared with those of other people.
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  Samuel Brittan illustrated that in more general terms when he stated that earnings increased on average by 14 per cent. at the last pay round, that percentage embracing an increase of about 11 per cent. to 12 per cent. in the public sector and 15 per cent. to 17 per cent. in the private sector. Much of the stress and tension that now exists in our society is a consequence of that imbalance.
  My second argument stems from what I have already said. Surely there must be an ignorance of the facts and realities in the body politic, among workers both by hand and by brain. If we accept wage increases of 5 per cent.—that is five times as much as Swiss workers are to accept—in the next pay round, we can look forward, given all the weaknesses of the real economy, to a future that has some hope. If we insist on 15 per cent., I am afraid that on the basis of simple arithmetic we shall be faced with many problems. I believe the theory that some spectators at a football match are determined to jump on to the backs of those in front of them to get a better view. I accept that if that practice continues and develops among the football crowd there will be chaos and no one will obtain any advantage.
  Our position this year is aggravated because we have no bonanza from a strong pound, low commodity prices and low rates of interest. We have no help from that quarter. The relationship of prices and wages is stark and simple. The Government let slip through a disgusting wage settlement with the BBC on the ground of comparability. The Government should help the BBC to get out of the red by buying time with a vast education programme to ram home some of the stark truths about the present economic situation. We must overcome the present economic difficulties. Others may inherit the mantle of office. Whoever they may be, certain facts must be underlined.
  What should the Government do about the Budget? If the worst comes to the worst and 15 per cent. wage increases become the norm. I do not think that that will lead to massive inflation. However, it will pose some serious problems.
  The Chancellor of the Exchequer should act on a number of fronts. I am worried about the rate of interest. There is much talk about an increase in the

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  minimum lending rate. It is clear from the back pages of the Financial Times that yields are already over 14 per cent. in one or two areas. That is preposterous. I was a critic of the Chancellor when MLR increased to 12½ per cent. I spoke to as many in the City as I could and they were staggered by the Chancellor's action. There is no case for increasing MLR now. I am glad that nothing happened today in that direction.
  Mr. John Pardoe: It will.
  Mr. Cant: I know that it will. However, I am full of hope. I make these statements and occasionally somebody listens. That has happened about twice in 13 years.
  Since 1968 I have always been an arch advocate of money supply and the need to get it under control. I am not in favour of cuts in public expenditure. I know that the cutting of public expenditure is the new orthodoxy. If incomes go way beyond what is acceptable, we should claw back the extra income by increasing income tax.
  Mr. Thomas Swain: Like Roy Jenkins did, only to throw it away.
  Mr. Cant: That is better than putting men out of work by reducing public expenditure.
  Thirdly, my right hon. Friend should reimpose hire purchase controls. Hire purchase is getting out of hand. In the 12 months to the end of November 1978, hire purchase finance increased by 30 per cent. That may not have a bearing on money supply today or tomorrow, but it will have a long-term consequence.
  7.47 p.m.
  Mr. John Pardoe: It is a pleasure to be called after the hon. Member for Stoke-on-Trent, Central (Mr. Cant). I do not share the hon. Gentleman's hopefulness about interest rates or the effect of the general realisation of the public of the link between wages and inflation on the latest wage round. Is it right to assume that the public have never been more cognisant of the direct link between excessive wage increases and high price rises? We are in an astonishing position that I suspect
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  few hon. Members expected to arise, especially at the end of a period of an unprecedented increase in living standards and take-home pay.
  We witness the second Government in succession who now bid fair to end their days in somewhat ignominious industrious chaos. Why is that? That is a fundamental question. Many of us will have different answers to offer.
  One of the conclusions drawn by many following the events of 1974—it was drawn publicly by some Labour Party Members—was that the United Kingdom was ungovernable by Conservative Governments because they could never learn to live with the trade unions. They argued "We need a Socialist Government because of the special relationship between the Labour Party and the trade unions."
  I never accepted that argument. I considered that we could not remain democrats and believe in one-party government. I believed that it must be possible for the trade union movement to learn to live with parties of complexions other than its own. I could forgive Conservatives for being slightly pleased, perhaps against their better nature, at the turn of events that has disproved the whole idea that Labour can govern Britain. It may be that their pleasure comes sadly. It may be that they are slightly pleased that the Labour Government have failed to govern Britain because of their special relationship. I do not think that this is anything to be pleased about on either side of the House. Just because the country has now proved to be ungovernable by Labour, that does not make it governable by the Conservatives or, indeed, any other Government. It may be that the country is ungovernable by any Government.
  I do not accept that argument, but Labour Members must realise that this is what our friends and enemies abroad are saying about us. Anyone who picks up a foreign language newspaper today, or even a North American one, will find comments of that sort right across the front pages, not just on the pages inside.
  That was the feeling that got around the world in 1974, as those of us travelling around the world then discovered to our horror. That feeling is once more widespread. However, I do not think that

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  that is the right conclusion. My conclusion comes very near to that of the hon. Member for Devizes (Mr. Morrison). It is not that this country is ungovernable but that it is ungovernable by the present method of politics and the system of government which we have. We therefore need a fundamental political change.
  Another conclusion which emerged from the 1974 situation was put forward by some optimists who said—and it follows what the hon. Member for Stoke-on-Trent, Central said just now—that Britain had looked into the abyss of mass inflation; it had looked into the total horrors of wage push and 25 per cent. inflation but had turned back from the brink so that things would not be like that any more. We are now seeing this astonishing rush for wage inflation all over again, and I think that it shows that the lessons of 1974 have not been learned, and cannot be learned, as long as we have the present system of governing the country.
  Mr. Swain: Will the hon. Gentleman give way?
  Mr. Pardoe: No, because I would rather make my speech. Mr. Deputy Speaker has said that he wants to get in as many speeches as possible, and I want to keep within the limits.
  The hon. Gentleman mentioned the question of political reform and I wholeheartedly agree with him. The Conservative motion talks about restoring the authority of Parliament, but before we can restore the authority of Parliament in the country we have to make Parliament worthy of that authority. The fact is that this old-hat 19th century debating chamber—the Leader of the House like it that way but he is rather an old-hat 19th century figure—is not an efficient method of bringing together the various forces in our society and of harnessing them into any kind of collective social action. It certainly is not an effective way of controlling and making efficient public expenditure, as we know constantly from the right hon. Gentleman who is the Chairman of the Public Accounts Committee. It is not even a good way of improving legislation, as any of us who take part in Standing Committees know to our cost.
  What is economically necessary has become politically impossible in Britain.
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  We can pass legislation, but it will have absolutely no effect in the country. The Conservative Party learned that the last time, and it may have to learn it all over again.
  The right hon. Lady the Leader of the Conservative Party has been led by this conclusion to make a quite astonishing offer. In her television broadcast last week she talked about making common cause with the Government on a limited programme. That offer comes from the leader of a party that has spent the last 18 months castigating the Liberals for having made common cause in a limited pact with the Labour Government. She is now offering precisely the same sort of thing, not joining the Government but making common cause with them on a limited programme. I am naturally very pleased that she should have moved towards the realisation that single-party Government has very limited effects. The question is, what measures would any Government pursue, even if they could find common cause among the parties? My view is that the measures which have been put forward by the right hon. Lady do not begin to deal with the immensity of the problem.
  I am glad that the right hon. Lady has discovered the fact of trade union monopoly power, a fact which has figured largely in the Liberal Party's analysis of Britain's problems and in its efforts to devise various policies for controlling inflation, with particular reference to a prices and incomes policy. But trade union monopoly power is not new. It did not happen because of the measures that have been enacted in the past few years. It was, I think, the Macmillan Government that set up the three wise men as a response to trade union monopoly power. Since that time Governments have been trying to grapple with the problem represented by trade union monopoly power and the effect that it has on wage inflation.
  We had various answers such as "In Place of Strife" and the Conservative Industrial Relations Act. Both proved to be an impossible dream. Now the right hon. Lady proposes postal ballots, public sector agreements, the withholding of social security payments from the families of strikers, and the abolition of the closed shop. I am entirely with the Conservatives on the question of the closed shop, but

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  they will find on the question of social security payments exactly the same arguments as faced the right hon. Gentleman who was Secretary of State for Social Services in the last Conservative Government. The question of these payments is not new. The question of social security payments for strikers' families has been examined by several Governments, and it was certainly looked at in the early 1970s. The conclusion then was that it was not possible to withhold them.
  Though postal ballots have some beneficial effects, they also have some disadvantages. One can see that the question of the postal ballot has not stopped the miners from using their power. As for public sector agreements, I do not know whether the right hon. Lady is really proposing to legislate. I cannot make out from the speech of the right hon. and learned Member for Surrey, East (Sir G. Howe) this afternoon whether the Conservatives are now committed to legislation to ban strikes in certain public sectors. I would point out to the right hon. Lady that at the time of the electricity supply industry dispute in 1970 I said to the then Secretary of State:
  "Is the right hon. Gentleman aware that there are circumstances under the Conspiracy and Protection of Property Act 1875 and the Electricity (Supply) Act 1919 in which the present action of electricity workers could be construed as being in breach of the criminal law?"
  I suggested that he might use the law which had not been repealed by the Industrial Relations Act. He replied:
  "We on this side of the House do not believe in the detailed application of the criminal law to industrial relations. We do not believe that our problems of industrial relations in Britain will be solved by the application of criminal law."—[Official Report, 11 December 1970; Vol. 808, c. 821.]
  Why has that changed, if it has changed? I ask the Conservatives to consider that these various measures, attractive or unattractive as they may be, simply do not measure up to the size of the problem. On the problem of trade union monopoly power, I wholeheartedly endorse the various pronouncements of our ambassador in Washington over the past few years. I believe that the "Jay formula", which is a natural extension of Liberal industrial democracy, would face up to the problem of monopoly trade union power by creating competing worker co-operatives. I think that is the
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  long-term answer. I do not believe that the solutions proposed in the motion are the answer. We must think far more in terms of controlling and making public expenditure efficient than restraining it.
  There are people who think that amendment 13 in California is a great solution to the problem, but of course what the Californians are discovering—as are other states which have followed them—is that, if one cuts back on public expenditure, one cuts back on services but not so much on public servants. The bureaucracy will always protect itself. There will always be more and more bureaucrats. All that one provides is fewer services. That is exactly what voters are finding in California and that is what we shall find here if we try to deal with our problems in the way that the Conservative Party is suggesting.
  Nor does the Conservative motion deal with the immediate problem, which is runaway inflation. We can talk about amendments to the law of industrial relations, and I see that Sam Brittan is talking today about setting up a Royal Commission. We have had one. We had the Donovan Commission. The Donovan Commission in the last few weeks has been quoted with approval on both sides of the House. It is a great pity that neither Government eventually decided to adopt the recommendations of the Commission. We would all be better off if they had done so. Having set up a Royal Commission, they might at least have accepted its proposals instead of casting them into the waste paper basket of history. That is what both Governments did. They legislated on their own pet schemes and had to withdraw them as a result.
  If we are to avoid runaway inflation, we need a long-term incomes policy for as long as it takes us to overcome the power of trade union monopoly. The Jay formula will take time to set up, as will the sort of legislation that the Conservatives are suggesting. But this must be an enforceable incomes policy, and the best way to enforce it is through the tax system.
  This afternoon, the Chancellor made the most forthcoming response to the Liberals' position on the selective taxation of excessive wage claims that I have ever heard him make. The only trouble is that, after a whole number of tutorials

  777
  on the subject, we do not seem to have got the message through to him. We are not suggesting that people should have selective income taxes made according to whether they get a high or low increase. Of course, the PAYE system will not allow us to adjust people's income tax according to whether they have a high or low wage claim. But the national insurance contribution is fully computerised. It is a straight percentage, and it is a simple administrative thing to do. It is the national insurance contribution that we are suggesting should be surcharged. In that respect, the hon. Member for Stoke-on-Trent, Central got it absolutely right.
  It will be even simpler if, instead of imposing a levy on those who exceed whatever guidelines are decided, we do what President Carter has suggested and offer a reduction in tax to those who abide by the guidelines, particularly if the reduction is self-administered and the individuals have to claim back the rebate. We could combine both, but in the latter respect it would be very easy administratively.
  From time to time Ministers accuse the Liberals and the Conservatives of joining together to side with free collective bargaining. That is now a new accusation against us—we are all free collective bargainers now. Yet that comes from a party whose national executive is totally committed to free collective bargaining, whatever the Government Front Bench may think. Most Labour Members below the Gangway are free collective bargainers. Indeed, the Leader of the House was a free collective bargainer during the last election and for the first year or so afterwards. He knows perfectly well that ever since 1967 the Liberal Party has said that a statutory and enforceable prices and incomes policy is the price that we must pay for full employment and stable prices. That remains our position. The only question between us is what constitutes effective sanctions.
  The sanctions which the Government were using were totally ineffective. They did not deter the Ford management or unions. They did not deter the transport employers from offering 15 per cent., which is a ruinously inflationary offer anyway, at a time when they felt that these sanctions would be used against
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  them. They were ineffective sanctions and were imposed on the wrong people. We cannot stiffen the sinews of the employer to withstand trade union monopoly power. We can do it only by taxing those who actually get the increases. That means increasing the surcharge on the employee as well as the employer.
  In the meantime, we are now faced with a riotous scene of wage-push inflation which will take us to 12 per cent. price inflation by the end of the year, rising to 15 per cent. or 20 per cent. in 1980. Although I believe that we need an incomes policy, I say now that, unless we have a wage freeze immediately, inflation will take off and we shall be back to 15 per cent. inflation in the first quarter of 1980.
  8.3 p.m.
  Mr. Robert Mellish: During the Christmas period, by way of using up my leisure time, I read a book by a Mr. Wilson—not Harold—which described the downfall of the Liberal Party. It was a book based on the historical past of that very great party at the turn of the century. Having listened to the speech of the hon. Member for Cornwall, North (Mr. Pardoe), I must say that at the present time I see no future for that party.
  The hon. Gentleman's speech was illogical and rubbishy. In so many respects it defeated itself. I suppose that the greatest failure that this country has, and the greatest difficulty we face, is that we live in a democracy. The democracy in which we live is the hardest and most difficult system of government to operate. It gives men and women the right to do a number of things. Every man and woman in this country has the right to withdraw his or her labour. Any man who attempts to institute legislation to stop that is on the downward path of Fascism, or Communism in particular. There are no strikes in Russia, not because they are all very happy boys and girls there but because they are not allowed to go on strike. That is the law of the land.
  I say to the House seriously that as a system democracy is hard to work. I speak with some qualifications. I did not join the trade union movement in order to become a Member of Parliament or a union official, because I was only 15 when I joined. By the way, this year I

  779
  qualify for my union's golden medal if I choose to apply. I have respect and affection not only for this country's past and present but also for its future. The question now is to get common sense into this great trade union movement so that it will operate under the difficulties that we are now facing.
  I was taught by one of the great trade union leaders—Ernest Bevin. As a trade unionist I always understood that one did not go on strike until one had to. That was the last thing that one did. Any fool can withdraw his labour. The great heartache is getting men back to work with a settlement that is honourable to those who come out on strike. The other thing which Ernest Bevin taught was that before one went on strike one tried to earn some public sympathy in order to get the public to understand what one's case is all about. If one's case is strong, then, if and when one is compelled to go on strike, one at least carries a large measure of sympathy when the strike takes place. I only wish that was remembered by trade unionists today. It is a story that I have never forgotten.
  So far as I can see, the Conservative Party approach is to criticise these strikes. What would the poor Tories do if they did not have these strikes to criticise? They certainly have not put forward measures that would deal with them. All they have done is to criticise them in a completely and utterly irrelevant way. I find that extremely sad.
  Both the Conservative Party and the media have picked on the case of one trade unionist who said that a three-year-old child should be allowed to die. They have picked out the case of one hospital worker who made certain remarks. But they have not taken note of the demands of the whole mass of people involved in the present strikes. That is an absolute disgrace.
  We have heard about one member of the medical profession who has said that he would not treat a man because he was a member of a trade union. That is also a disgrace. I know many consultants who are good and honourable men, whose only concern is to treat people because they are sick and not because they belong to a trade union.
  The vast majority of trade unionists are unhappy with the situation with
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  which we are at present faced, and no organisation in this country has played a greater part in trying to get stability in this country than the trade union movement. It has shown a patriotism that I did not believe was likely. It has agreed to stages 1, 2 and 3 and totally co-operated with the Government. It has accepted many restrictions.
  In return, this Government have been more tolerant, fair and honourable to the trade union movement than ever before. They have taken away every possible restriction objected to by the trade union movement. In the last three years the Government have received in return the greatest co-operation possible.
  The right hon. and learned Member for Surrey, East (Sir G. Howe) would have us believe that what is happening today has never happened before. I do not know where he has been living for the past 40 years. In dockland we have had as many strikes as we have had Sunday dinners. Pickets have always existed. A man has a right to be a picket and to stand outside a factory and stop people entering. The trade union movement was built on that principle.
  There are abuses of the rights of the trade union movement. I am hearing words that I have never heard before, such as "secondary pickets". Moss Evans made the road transport strike official because it was the only way in which his union could gain control. The abuse that the Tories have thrown at the trade union movement over the last few months is scandalous. The Liberal Party has not done much better. The trade union movement makes strikes official in order to control them. It could be argued that its control is insufficient. But one cannot talk of lack of official control by the trade union movement and then criticise a monopoly by the trade union movement.
  We should be talking of responsible trade unionism. The vast majority in the movement are responsible trade unionists. If today I were a worker involved in an official dispute, I would not be at work. By my very nature, I could not be a blackleg, but I would be doing a darned sight more than is being done now at the local level to examine the decisions that are being made. This is the root of the matter. Individual trade unionists should take action.

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  We have heard the economic arguments today. The Tories support free collective bargaining. But we have had collective bargaining ever since I was born. The unions with the greatest muscle get the greatest wages. That is a fact of life. That is why there are lower-paid workers. That is why those who do not have the muscle do not get the wage. It cannot be denied that the trade union movement is an established way of life in this country. Nobody will destroy this position, unless one turns to Communism or Fascism. That being so, how do we get these people together?
  The first move has been made and it must be strengthened. The Prime Minister has talked about a new concordat with the unions. We must establish an understanding of what the nation can afford to pay long before disputes occur. The Government have had to be more flexible in the last few weeks. The 5 per cent., as even a starting point, was never on. It could never have been applied after the unions' patriotism over the years.
  Anomalies have inevitably been created. I come from a part of the country where low wages are prevalent. For example, in hospitals there are male nurses earning only £40 to £45 a week. No one in the House can justify that. We must say to the trade union movement that the time is long overdue for those at the lower end of the wages scale to receive special priority, not from the Government but from the union movement. There must be a change of heart in the trade union movement.
  The Tory Party may come to power tomorrow. The aftermath of the disputes may rub off on the Labour Party. But the Tory Party does not solve the problems on the day that it comes to power. I do not believe that the Tories have a prescription to change the heart of man and to get everyone back to work. If I were a member of the Opposition, I, too, would have some lively criticism. The Conservatives are exploiting the present situation to ensure that this Government's nose is rubbed in the dirt. They seek power at the end of the day.
  The fact remains that this Britain is a democracy. Britain has a trade union movement which has struggled over the
  782
  years to get where it is today. It will not be overthrown. However, we must get the finest elements in our trade union movement to understand the argument that although some of them, because of their muscle and their strength, get much higher wages than the country can afford to pay, in the end it is the nation as a whole—including those unions—that has to pay the price.
  I appeal to the railwaymen. I am not a railwayman, and I know nothing of their arguments. However, we know that this row has been pending for a long time. I do not know why the problem has not been solved before now. We already know that ASLEF has the power and strength to inflict hardship and agony upon millions of people. I appeal to that union not to prove it again, and to get off our backs. ASLEF has done it once, it has shown us how strong it is, and we know what agony it can cause. Therefore, it should stop now.
  More than £5 million a day is being lost to the railways. I do not understand that sort of economics. If ASLEF, the NUR and the British Railways Board—they are all in this together—want a future and want an industry that will pay the sort of wages the men have a right to demand, they must get off our backs.
  Trade unionists should realise what they face if they insist on throwing out this Government. The Government have tried desperately hard to co-operate with the trade union movement. They have given this nation a stability which it has not had for a long time. They have reduced inflation to 8 per cent. If trade unionists throw out this Government they will have to live with a Government in power which, since the unions were born, have been their enemies. The Conservatives loathe and detest the trade unions. If they come to power they will do everything they can to destroy everything that has been built up. Their policy will be to use blacklegs and to devise ways and means of bringing the police into industrial disputes in every possible way. I know their style. They will do it in the name of patriotism and claim that they are benefiting the old, the sick and the young.
  In fact, the truth of our history is that the trade union movement has, through its efforts from 1900 onwards, improved the position of the old, the young and the

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  sick. The trade union movement saw that the Labour Party was born. I do not deny that. I do not deny where I came from and I do not deny where I must return. I plead with the trade union movement not to destroy what has been created.
  8.18 p.m.
  Mr. Eldon Griffiths: Some years ago a man called Alan Paton wrote a book called "Cry, the Beloved Country". He was writing about South Africa, but that title might be applied to our country today.
  I hold none of the views that have been attributed to Conservatives by the right hon. Member for Bermondsey (Mr. Mellish). I regard trade unionists as fellow citizens, and I have just as much wish as he has to see our country established as one nation. I want to see us all working together—the trade unions and the employers serving the public interest. I regret that in an otherwise sincere and eloquent speech, as we have come to expect from the right hon. Member, he spoiled it by descending into class warfare.
  A lot of things are happening in our country that are shocking. I shall give three examples. First, in my constituency cruelty is being visited upon the sick and elderly, not by the majority of NUPE trade unionists but by a few of them. Secondly, bullying is rife among ordinary men and women who want to go to work, do their jobs and earn their wages but who are frightened to do so because they dare not risk losing their union cards and therefore their right to work.
  Thirdly, there is blackmail on a very wide scale. I want to tell just one story of a director of a middle-sized firm which, over the last 20 years, has collected 20 tons of sugar every week from a British Sugar Corporation store. His lorry was not loaded last Friday despite Government statements about the free movement of food. The man telephoned the union and asked if he might go along to plead his case. When he arrived in Ipswich, he found himself on the stairs with about 20 other business men waiting to plead their case to obtain sugar for their factories and to keep their employees in work. After waiting for about an hour, he was admitted to a room in which 13 members
  784
  of the Transport and General Workers' Union sat as a court. He was expected to—and did—plead with them for the sugar to keep his plant operating. He is not a man of politics. He is a straightforward man of business. He told me "I went there prepared to grovel. I got on my belly like a worm." But his plea was refused and he was sent out with no sugar for his factory.
  In the event, one of the more sensible shop stewards took him by the arm, and he returned to the room. There was a further debate. He was finally given a chit across which was written "20 tons". He took the chit to the sugar plant and was at last able to move the sugar. That kind of humiliation is not the England I know. It is far more reminiscent of Russia.
  We are in a crisis. It is a crisis with four separate aspects. There is the physical threat to our food, our fuel, our jobs and, soon, our trade. There is the threat from certain militants within the trade union movement to the freedom of the individual and to the rule of law. I do not believe that is the wish of the overwhelming majority of members of the TGWU. But there has been infiltration—Ministers will soon have the evidence—of some picket lines by political elements financed from elsewhere.
  Thirdly, there is a credibility gap. Minissters say one thing in the House and the public know perfectly well that the reality is very different. For example, it is no good the Prime Minister giving us homilies about crossing picket lines when the reality is that ordinary men and women are frightened to do so for fear of losing their jobs. It is no good the Prime Minister, as he did today, calling on the police to do their job—the police, incidentally, who so often have been attacked and denounced by Labour MPs—when they cannot get evidence because people are too frightened to give it for fear of intimidation.
  The worst problem is political paralysis. The Prime Minister is unable to call in the soldiers to move the necessities of life because he knows that his party would not back him. His 5 per cent. policy is dead, but he cannot go for a statutory one because he knows that his party would split. So our country faces a crisis. We need a new initiative.

  785
  That is why I congratulate my right hon. Friend the Leader of the Opposition on having the courage and the generosity to offer the Prime Minister the assistance of the Conservative Party in putting through measures that the vast majority of our countrymen know the nation needs and want to see enacted but which the Labour Government have rejected because they know that they would split their party wide open.
  I believe that my right hon. Friend the Leader of the Opposition is the one national leader in the past week who has shown a national initiative and has sought to bring the parties together. She was right to do this. I hope that the Prime Minister will think again about her offer, because there will be no end to this crisis unless her approach is accepted by all concerned.
  8.25 p.m.
  Mr. Gordon Wilson: At first I thought that the debate would be a re-run of the others that we have had and that that would be no great advantage, but the speech by the right hon. Member for Bermondsey (Mr. Mellish) was like a breath of cold air. He took a commonsense approach, but towards the end of his speech he tended to imagine that he was on a public platform. Perhaps that was in preparation for the coming election.
  We are being asked to make a choice between the Opposition's motion and the Prime Minister's amendment. There are flaws in each of them. There is a lot of codswallop in the Prime Minister's amendment. It talks of
  "the supreme interest of the community and the legitimate rights of all sections of it."
  That is empty phraseology which pads out the amendment and is an attempt to encourage hon. Members to vote for it.
  The motion has a fatal flaw. It assumes that there will be restrictions in public expenditure. Those of us who live in areas which are dependent on public services can see that there will be considerable unemployment as a result of such a policy.
  We are dealing with the worst series of strikes that we have had for five years. These must stem from a fundamental reason. Other countries do not experience the same pressure. There must be a reason why people in the United Kingdom
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  feel that they must withdraw their labour and become militant in order to improve their standards of living.
  If we were able to secure a general rise in the standard of living, year by year, out of increased productivity and increased competitiveness, there would be fewer industrial disputes. In those circumstances the workers in the various industries would know that as a result of their efforts they would receive an increase in their standards of living and that their families would be taken care of better.
  I was struck by a written reply yesterday about the United Kingdom's position amongst the top 25 economies. In one year the United Kingdom dropped from 17th or 18th to 20th. The United Kingdom is now behind East Germany and just ahead of Israel, Czechoslovakia, Italy, Spain and Poland.
  We must deal with our decline in living standards compared with other countries. Just 20 years ago the United Kingdom was fourth in that league. It is inevitable that disputes will take place under those circumstances. There is no easy way of stopping the crises. We can expect them to occur, although, perhaps, not every year. Disputes will grow and there will be an increase in bitterness because of the difficulty those who work in the public sector find in obtaining more money. I believe that criticism can be made of the way in which the Government have dealt with the crisis. Certainly, there has been a political paralysis, and it seems that the Government were taken aback by the way in which the disputes grew and their impact. They were unable to find a solution.
  I believe that if the Government had relaxed the 5 per cent. policy in September or October and set a limit of 8 per cent. or 10 per cent., many of the advances would have been held back. Last summer it was clear that there was no possibility of the Government securing an agreement with the trade union movement to limit wages to 5 per cent. I believe that that is where the Prime Minister made his political error.
  The Government cannot find any answer to the crisis except on a care and maintenance basis—that is, to secure the supply of food and to make sure that commodities such as pharmaceuticals reach the factories. In practice, that is the extent to which the Government can

  787
  move. They are clutching at solutions and do not seem to have reached any.
  Last year there was an increase in the standard of living of about 8½ per cent., but my impression is that that was not applied levelly over the whole working population. Certain classes of workers received 18 per cent. and 22 per cent. rises through various legitimate methods of negotiation. Others, for example, the jute workers, were limited to the bare minimum—and less—recommended by the Government at that time.
  I criticise the Government for the delay in producing statements about how the dispute affects Scotland, where the haulage strike began earlier. However, I am entering into matters which are not germane to this economic debate.
  The failure of the United Kingdom to provide an increase in the standard of living in line with expectation has resulted in these troubles. The problem is not new. I have already quoted the Chancellor of the Exchequer's figures which appeared in Hansard. One of my predecessors in Dundee, East was Lord Thomson of Monifieth. In a recent article he said that, during his period in public life, all forms of public expenditure had increased. He said:
  "When I went into Parliament in the early 50s our share of world trade and manufacturing was 19 per cent. as against West Germany's 15·5 per cent. The figures today show West Germany 20 per cent. and the United Kingdom 9 per cent."
  Further on, in relation to the comparabilities, he said:
  "By the time I left Westminster for Brussels in 1972, France had nosed 15 per cent. ahead of us but the G.N.P. for Germany had shot 50 per cent. in front. Today in G.N.P. per head terms France is now 50 per cent. ahead of us and Germany 100 per cent."
  He went on in that vein. In my opinion, Lord Thomson spelt out one of the main reasons for our present difficulties. We cannot look for an easy solution.
  Of course, the SNP looks at the problems from a Scottish point of view. Two days ago, it was announced that unemployment in Scotland had increased by 18,500. I am well aware that that is partly due to Christmas school leavers. This does not occur in English and Welsh schools. Nevertheless, on analysis, the increase seems to be exceptionally heavy.
  Professor Donald MacKay of Heriot Watt university gave some bleak information
  788
  in a recent review. He criticised the Government for using North Sea oil revenues to finance the consumer boom at the expense of industrial investment. He claimed that over the past two years Government spending on regional policy in Scotland appeared to have fallen by about 40 per cent. and said that between 1976–77 and 1977–78 expenditure on regional policy appeared to have fallen from £216 million to some £144 million. This represents a fall of one-third in money terms and of 40 per cent. in real terms, allowing for inflation. His view is that there will be a drop in investment and we shall all continue to get poorer in 1979 unless firm action is taken on the country's economy. That is a bleak view from one of Scotland's premier economists.
  Other reports have suggested that Scotland's economic growth has been lower than was thought and that it has increased by 1·6 per cent. while the United Kingdom growth has been 3·8 per cent. I could go into that in greater detail if time permitted, but I merely draw the attention of hon. Members to the Financial Times which contained that analysis.
  All this contrasts with what is happening in the Republic of Ireland. The House used to sneer at Ireland because it was a poor country with no industrial structure. It is now moving ahead in leaps and bounds. I accept that that is partly due to the agricultural boom that followed entry to the Common Market, but the Irish have a large number of people employed on the land who are expected to lose their jobs in line with the trend in most developed industrial countries. However, in 1978 the Republic approved the creation of 30,000 manufacturing jobs and managed to expand exports by 20 per cent.
  Mr. Eddie Loyden: Foreign investment.
  Mr. Wilson: Of course it is related to foreign investment, and much of the investment going into the Republic could have come to Scotland, the North of England, Wales or other parts of the United Kingdom. The economy of the Republic of Ireland seems to be better managed, but I wonder, too, whether the incentives attracting that foreign investment may be producing investment starvation in the United Kingdom.
  The Under-Secretary of State for Scotland (Mr. Harry Ewing): The SNP policy on land is that a majority of companies in Scotland will have to be resident and live in Scotland. That would not attract foreign investment. If the hon. Gentleman is now in favour of foreign investment, he will have to change his party's policy on land ownership.
  Mr. Wilson: Not at all. Apart from the fact that companies do not live anywhere, if we follow the Minister's argument to its conclusion, we must accept that the Labour Party's policy of land nationalisation would result on the extinction of foreign investment in Scotland. The Minister is not as unintelligent as his intervention may lead people to believe and he knows that most companies are looking for factories from the Scottish Development Agency and do not own land. Most incoming firms prefer to lease their premises. One of the key factors of Government policy in relation to the SDA was that such factories would be built to house incoming investment. The SDA is not doing enough in that area.
  We have sluggish growth in Scotland and do not seem to have any prospect of improvement. There has been a 40 per cent. fall in regional development aid. We want to see the revenue available to us from our own oil resources ploughed into our economy and, since the House, the Chancellor of the Exchequer and the Treasury are failing to provide industrial and economic growth in Scotland—just as they have failed to provide that growth throughout the past 20 years—we want powers to be given to the Scottish Assembly so that we may produce in our own country the economic expansion which we so badly need.
  8.40 p.m.
  Mr. William Molloy: The hon. Member for Bury St. Edmunds (Mr. Griffiths) criticised the Prime Minister. He also criticised my right hon. Friend the Member for Bermondsey (Mr. Mellish) for making a divisive speech. I find that rather rich, coming from the hon. Member, as he represents the ordinary police of this country and was guilty of one of the most offensive, vulgar and uncouth attacks imaginable on the Royal parks police. It has caused great anxiety in their union. It was a most uncalled for attack on those police officers.
  790
  It annoyed not only them but many ordinary policemen as well. When the hon. Member chastises other people in this House for being divisive, he should consider the mote in his own eye now and again.
  This should have been a very important debate, Mr. Deputy Speaker, but I regret to say—
  Mr. Eldon Griffiths rose—
  Mr. Molloy: Following the example of the hon. Gentleman, I shall not give way. That is the only thing in which shall be careful to follow him.
  It should have been a very important debate, but, alas, it did not get off to a very good start, because of the speech made by the right hon. and learned Member for Surrey, East (Sir G. Howe). One hopes that the Opposition spokesman will do better in reply. He will not have to try very hard. The whole theme of the right hon. and learned Gentleman's speech was that if the damage to this nation means damage to the Labour Party, he welcomes it. He was loudly cheered for introducing that theme.
  How does this tie up with the submissions that we have heard earlier at Question Time in recent days from Conservative Members showing their concern—I am sure that it is quite genuine—about the ambulance men and the ambulance service in London, about the patients in our National Health Service hospitals, the difficulties of housewives, and so on? Are they to be seen as merely imitation flowers? On the one hand, we have Conservative Members expressing their grave concern about these issues. On the other hand, we have the right hon. and learned Gentleman—speaking, I presume, on behalf of the Conservative Party—making an appalling speech in which the major theme was almost to welcome the serious condition in Britain today because he thinks that somehow or other the Conservative Party will get considerable political gains from it.
  The right hon. and learned Gentleman said that he could see, from what has happened in the past few weeks, that the Labour movement would be damaged, but never once during his remarks did he mention what happened in the few preceding years of the Labour Administration. In fairness to the spokesman for the Liberal Party, the hon. Member for

  791
  Cornwall, North (Mr. Pardoe), I am bound to say that he referred to that period. For four or five years there was remarkable collaboration and co-operation between the trade union movement and the Labour Government. The real tragedy is that we were getting almost to the last lap, when we could have won the battle, or made a magnificent contribution to winning the battle against inflation, only to find ourselves in this difficult position.
  There is no doubt that the trade union movement has made a magnificent contribution. One might have thought that the right hon. and learned Gentleman, who was guilty of so many sins when his party held office, would have had the humility to acknowledge the extent of that collaboration. Regrettably, he was concerned only with trying to make cheap political points. I hope that the Leader of the Opposition will read his speech very carefully. If she does, it should cause her to dismiss him from any hopes of office if this country should suffer the really major tragedy of having a Tory Government at any time in the next 40 or 50 years.
  It is very difficult for a Labour Government to operate, bearing in mind the bias of the free press of Great Britain, which has such a strong leaning towards the Conservative Party. Indeed, I once heard my right hon. Friend the Leader of the House of Commons say that even the streams in Wales were running on the Conservatives' side. There is no doubt whatever that the newspapers in this country run on the right-hand side, with a heavy bias against the Labour Government. We are proud of our free press, but when people in other countries read our newspapers they find it remarkable that they all seem to be the voice of one party, the Tory Party. Of course they are, and this does not do us much good.
  When the hon. Member for Corn-wail, North spoke of the effect that this is having, and of the kind of thing that he hears from our friends and our enemies overseas, he was careful not to say whether he supported our friends or our enemies overseas.
  No one has mentioned the hard fact that when the Labour Government in 1964 took over they inherited a massive deficit from their Tory predecessors. Then, when we were defeated in 1970, our Tory
  792
  successors inherited a handsome balance of payments situation, with a massive profit. When we came back in 1974 the Tories had recklessly squandered that and left us with an enormous debt, which contributed to the runaway inflation, confetti money and ridiculous situations such as the three-day working week. Those were all the things that we inherited, and that must go on the record as well.
  In this situation, ordinary people want to know where the Tories stand and what they would do. I listened very carefully to the right hon. and learned Gentleman's speech, and I have not a clue as to what the Conservatives' policy would be, except perhaps on one thing, and that is prices. They might consider some holding down of wages, but they would be in favour of a price explosion, and when the ordinary housewife complained that she needed more money and her husband went to the trade union, and it was told there was noting doing, so that industrial action was taken, there would be the usual hypocritical reaction.
  On public expenditure, it seems to me that it is not that the Conservative Party has no policy but that it has 200-odd policies. The Front Bench has one policy—to cut public expenditure—but we all know that on various occasions at Question Time, when hon. Ladies and hon. Gentlemen opposite speak for their constituencies, they want better rates, better hospitals, better schools, better pay for firemen, better standards for the police, and so on—but only for their own constituencies, because otherwise, of course, it would mean a massive increase in public expenditure. So they have roughly 200 different policies and collectively they constitute mass hypocrisy.
  If, for example, the policy of the right hon. and learned Member for Surrey, East on pickets were to be carried out, imagine what would happen. I should like to remind the House that the right hon. and learned Gentleman earlier reminded the House that the Prime Minister had said that he had the same right to walk through any picket line as had any other citizen. Then the right hon. and learned Gentleman quoted what some picket had said would happen to the Prime Minister if he dared to do that, and all the Tories laughed. The party of law and order was thrilled to bits at the idea of the British Prime Minister getting the thick end and

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  the rough end of a bunch of pickets. That is another hallmark of their supreme deception.
  In their motion the Tories list the alleged failures of the Government, but there is not a word about what they would do. I have been listening to speeches about the failures of the Government and about the trade union movement—everybody except themselves. Not a word on alternative policies have they uttered. Never has so much funk been wrapped up in so much evasion.
  What I believe we must do is campaign for co-operation in our industrial and economic endeavours, not for the sake of the Tory Party, the Liberal Party, the Labour Party or anything else, but because co-operation by all sides of industry is absolutely vital if we are to win the war and avoid the real defeat of Great Britain, which is the threat of massive inflation. If we get that co-operation, it will be to the credit not so much of the political parties as of the country, and it will be a triumph for Great Britain.
  8.49 p.m.
  Mr. Fred Silvester: The great benefit of the speech of the hon. Member for Ealing, North (Mr. Molloy) is that it is convenient whatever the subject before the House, and those of us who have heard it before will be forgiven if we find it not very satisfactory to have a wide polemic of that kind when we are concerned about situations throughout the country to which that kind of polemic is particularly inappropriate.
  Several hon. Members have drawn attention to the fact that this debate has gone a little wider than some of the matters before the House this week. It nevertheless remains true that in the country outside this House, however much we may change the nature of the subject in this Chamber, we are faced with a situation that is bearing down on people day after day with a gloom, despondency and despair which is growing.
  As hon. Members will know, I come from a constituency in the North-West. It is noteworthy that there have been several mentions from the Front Bench that the North-West is the part of the country worst hit by this series of strikes. It has been said by the president of the chamber
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  of commerce in Manchester—perhaps not too cynically—that if the South of England, particularly Whitehall, had been suffering in the same way as parts of the North-West have been, there might have been a greater concentration of effort.
  However that may be, the fact remains that we are faced there with a continuing series of dislocations which have nothing to do with a number of the alibis that are being put forward. It is true that there is a problem about low pay in the public service which has gained a great deal of attention from Labour Members below the Gangway. It is true that whenever we get a strike of any kind there is dislocation of one sort or another. In addition to that, we are facing a whole series of actions which are of a different kind and a different order from those that we have seen previously.
  When the statistics are published by the Department of Employment, I have no doubt that a nice little niche will be found and that we shall find that the numbers of people involved and the number of stoppages will not look particularly bad. However, one must add to those figures of people actually involved in the stoppages not only those who have been laid off but those whose work has been seriously impeded. One must consider the small companies that are stockpiling stuff that they cannot move, and the even worse-off companies that have got people doing jobs that they are not paid to do. They are simply having to fill in time because the employers do not want to lay them off.
  In the North-West the latest figure for lay-offs was 31,513, as at last night. It is expected to be 50,000 by the end of this week. They are not exaggerated figures. They are the current figures.
  In my constituency we have still got our schools closed. A primary school not far from my house has been closed since before Christmas. It may not sound very much, but if one happened to be a child aged five, so far, by the coming half-term of this term, if the school still has not reopened, one will have lost about one-tenth or one-twelfth of one's whole infant schooling. That is a very large part of a child's school life.
  I am still waiting for news—I do not know what the result was—of the meeting at the complex of Withington,

  795
  Wythenshawe and Christie hospitals, one of which is the leading cancer unit in the North-West and one of which is the leading heart unit in the North-West. A meeting has been taking place all day between COHSE and NUPE on the question whether they will continue the strike which has gone on since Monday. The surgeons involved there are already restricting admissions.
  With what is happening in the North-West and elsewhere in the country, we are faced with an endemic epidemic of strikes of various kinds—large and small. Sometimes they are quite small in number but very large in effect. What is particularly sinister is that they are designed particularly to be small in number and very large in effect.
  Many reasons will be advanced for that. I join those hon. Members who believe that the pent-up effects of prices and incomes policies, particularly in respect of differentials and in the public service, are a major cause of all this. But, in addition to that, we must take note of the different nature of the present circumstances. This debate, particularly the opening speech of my right hon. and learned Friend the Member for Surrey, East (Sir G. Howe), has made clear that we are faced with a situation which has been made considerably different from the circumstances which hon. Members have discussed when talking about Donovan and about 1971 and when the right hon. Member for Bermondsey (Mr. Mellish) was talking about the days of Ernest Bevin.
  We are in a different world, and that different world is involving new circumstances about which this House and the Government must decide what action to take.
  Many times in the debate mention has been made of a substantial movement of the safeguarding of the rights of people in this country from the normal law-enforcing bodies and places where they would expect authority to be found—the House of Commons, the police, the courts and elsewhere—to self-established courts which do not have the right to function. It is no use saying that these things have happened in the past. Of course they have. But they are now on a much bigger scale; they are run of the mill.
  There is no point in quoting examples from my constituency. We have had them
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  time and again. My hon. Friend the Member for Howden (Sir P. Bryan) started on Monday with a clear description. Such examples can be duplicated. They have been verified and are known to exist. We have met the people who have suffered humiliation in these circumstances.
  Within the whole industrial scene there is a growth of unreason and a contempt for the law and the standards that we have come to know. Of course, the Government cannot solve these questions overnight. The Conservative Party, just like the Labour Party, will have to work in co-operation with the unions. But, in addition, the Government must take steps and give leadership. It is all very well to be brave here. But it is difficult for a man to be brave when he is alone in a lorry, stopped by a picket line and threatened with being done over or threatened with having his union card taken away or whatever it may happen to be.
  The people who wish to take action, who wish to solve this crisis, are being asked always to act alone, in the dark, in odd places in all parts of the country, whereas the people confronting them are all together, carefully organised and orchestrated.
  The only place to which the people about whom I am talking can turn for a lead is here—the Government. It is up to the Government to ensure that the docks in Manchester and Liverpool are unblocked. They have the power and the resources to do it. It is no use saying that it is cosmetic to introduce emergency regulations. They are available and can be used in this situation. It is about time the Government got off their backsides and did something about it.
  8.57 p.m.
  Mr. Robert Kilroy-Silk: The hon. Member for Manchester, Withington (Mr. Silvester) began by saying that he did not wish to make any partisan political points. Yet he and his hon. Friends have been doing just that for the past two weeks with a series of hysterical statements, none of which in any way contributed to industrial peace, all of which exacerbated the situation.
  The hon. Member for Bury St. Edmunds (Mr. Griffiths) said that the

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  people of this country will not stand for it any more. Who are the people we are talking about? Are they teachers, hospital doctors, nurses, airline pilots, air traffic controllers, social workers, civil servants, local authority workers, miners, enginers, railwaymen or car industry workers? If so, all of them, and many more, have taken industrial action in the past few years.
  The people we are now talking about who are supposed to be at the end of their tether and losing patience with the current spate of industrial disputes pursued similar activities in furtherance of their industrial and economic interests in the past, whether they be hospital doctors or nurses, teachers or social workers, miners, dockers or local authority officials. Therefore, it ill becomes them now to complain about their colleagues in the low-paid sector of public industry who are pursuing their legitimate industrial and economic interests.
  It ill becomes the Conservative Party, which is officially in favour of something called free collective bargaining and which has in the last few years been giving great encouragement to the spread of this new, fashionable, unfettered, free collective bargaining, to complain when it does not like the results. Opposition Members are in favour of free collective bargaining at one moment, but they resort to their traditional refuge of hypocrisy when the results do not conform to their expectations.
  Low-paid workers in the public service who are now taking industrial action have legitimate and real grievances. They feel a deep and genuine sense of bitterness and resentment. Hon. Members would feel a similar bitterness if they were asked to take home a pay packet of £40 or less per week on which to bring up their families.
  Many of these workers have lobbied the House this week and they have shown their representatives in the House wage slips setting out such low wages. They know that their case will not be treated on its merits and that it will not be examined objectively or rationally. They know that their case will be taken seriously only if and when they use political muscle in order to make the Government listen to their grievances.
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  Unfortunately, that is the message that has gone out throughout the period of this Government on pay policy. People have come to believe that they will get what they deserve only if they have the political or industrial muscle to get it for themselves. It is no good relying on somebody to give them extra money, because their case is just and equitable.
  We see the present consequences of free collective bargaining. I find some of these consequences totally indefensible. I cannot excuse or defend the holding up of food supplies or essential medical goods. I find it totally reprehensible that a hospital should be picketed or that school-children should be prevented from entering school. That is no part of traditional trade unionism as I understood it. It cannot be condoned and should be thoroughly condemned.
  At the same time, it is fair to point out that many who are engaged in industrial action have legitimate and genuine grievances, not only because they have been ignored but because of the anomalies which have arisen following a rigid pay policy, with all its unfairnesses, imposed by the Government. It is always the same people who are discriminated against. The same sections of working people are always called upon to make sacrifices. However, it is the select few who can escape the rigidities of pay policy by phoney promotions, perks or by determining their own salaries, fees or commissions. It is an anomalous and unfair situation in which we have asked people in the past three years to make sacrifices, while others have been allowed to go their way at their will, willy-nilly.
  The present situation is also a consequence of the continuing affair in the corridors of power which many of our trade union leaders have conducted with Ministers in that period. Many people on the shop floor and in their places of work have lost confidence in their trade union leadership. They have seen that trade union leadership is an oligarchic, corporatist embrace with the Government. Decisions have been taken by the Government, CBI and TUC with little courtesy of any reference to Parliament—and still less by taking into account their members' interests. On many occasions the trade union leaders have been seen as the apologists for Government policy, the purveyors of Government propaganda,

  799
  rather than as articulating the grievances of those whom they represent.
  Ironically, we have had exactly the same call from the Opposition. They do not want trade union control in the context of the closed shop, they utter fine phrases about the freedom of the individual, yet when unofficial strikes occur the Tory leading spokesmen call for the trade unions to impose discipline on their members. Suddenly, the trade union has become a respectable adjunct to the policy of the Government or that of the Tory Party. The trade unions are expected to take on the role of industrial policemen—which should only be the function of a trade union in a country such as the Soviet Union. If such a role is adopted in this country, it will lead to a great deal of inter and intra-union disruption and discontent.
  The trade union leaders are elected and paid by members to represent their interests. However misguided they may seem to the rest of the country, that is the function of trade union leaders. That is why the trade unions were formed, it is why they exist, and it is why trade union leaders are elected. It is certainly what they are paid for. They are not paid to do the bidding of any Government, of whatever party, or the bidding of the CBI, the Tory Party or the media. Yet that is what many Opposition Members want them to do and, unfortunately, that is what too many of our trade union leaders have allowed themselves to be conned into doing in the last few years. The result is a loss of confidence in the trade union leadership on the part of the membership and the loss of proper and adequate communication between the top and the bottom of the trade union movement.
  It is not surprising, therefore, that the strike is official now only because of the unofficial movement from below. It is breaking through the three years of pay policy and pushing the trade union leadership in the direction in which the members want it to go, not in the direction in which many of those trade union leaders would probably—as they might privately admit—like to go. They like the warm, cosy embrace with Ministers in the corridors of power, in Whitehall. It is easier. It is much more comfortable and it gives them a great deal of importance and status.
  800
  We are now, in a very real sense, witnessing the real industrial democracy of the work place. For that reason, if for no other, the present crop of industrial disputes is a very welcome intervention. If we do not like—and I do not like—the selfish, grasping consequences that flow from, and are necessary to, collective bargaining, we must change it. The only way in which we can do that is by the introduction of a Socialist incomes policy which takes into account all forms of income, and all forms of wealth, where the nation's resources are distributed fairly and rationally according to an individual's worth to a community and not, as at present, on the basis of the Tory philosophy of the rewards going to the most powerful, most selfish and most grasping.
  9.7 p.m.
  Mr. John Moore: Because of the limited time, I shall not take up the points raised by the hon. Member for Ormskirk (Mr. Kilroy-Silk), except to say that although I was attracted by one or two of his gentle rebukes to the aberrant trade union leadership of the past two years—and I accept some of his points—he sadly lost the House at the end by his pursuance of his peculiar new dream called the Socialist incomes policy. I thought that he and many Labour Members had a sound point when they talked about the problem of the low-paid. We are, after all, in a country in which people earn too little, and we should reiterate this point frequently.
  I shall not spend time on our present difficulties, because I think that we have become obsessed with debates about picketing and picketing law. I shall try to understand why we are in the present situation. I believe that there are two fundamental reasons, related to the immediate past, which have produced the present wage explosion. One relates essentially to the failure, as opposed to the supposed success, of the past four or five years. The scecond—which is interrelated—concerns the contortions on incomes through pay policy. I shall not speak in the macro-economic terms that are usual in economic debates but shall try to relate the subject to the real life of my constituents.

  801
  I am proud to represent a constituency in which over 50 per cent. of my constituents are council house tenants. As a representative of an urban, industrial, marginal seat, I have some knowledge of the problems facing my constituents. I wish that some of them could have been here earlier to hear the statements about the apparent successes of the past four or five years, because my constituents do not happen to live in that successful world. I shall try to define for Labour Members the reality of those five years. I shall tell them about a typical average industrial manual worker with two children who lives on one of the large council estates in my constituency.
  Let us see what happens when that worker goes home. He says to his wife "Here is my pay packet for the week. I am an average industrial worker and I have been given an increase, after four and a half years of Socialism, of 96·7 per cent. I have £71·55p in my pocket." He gives the whole wage packet to her. As they sit down at the supper table, the wife says "That is a 96·7 per cent. increase, but look at the bread in front of you." These are the real things in the lives of the people in my constituency. She says "The bread has gone up by more than 100 per cent. If you think that that is enough, look at how the price of butter has increased."
  Mr Kilroy-Silk: That is because of the common agricultural policy.
  Mr. Moore: The hon. Gentleman should look at his own Minister's response on the CAP earlier this week, when he attributed 10 per cent. of the increase to the CAP, not the other 90 per cent.
  The price of the butter on the bread has increased by 172 per cent. It is a special night for that worker. In the world in which we now live we do not see meat very often, but this man has a little rump steak. At 188p a pound, that has gone up in price by 106 per cent. The price of his tea has gone up by 156 per cent., and before he puts more milk in his cup of tea his wife points out that their two children like to drink quite a lot of it. The price of the milk has gone up by 143 per cent. [Interruption.] I know that Labour Members do not like the reality of five years of Socialism,
  802
  but these are the prices that my constituent is paying.
  My constituent is spending more on less food. He is a little disconcerted by his wife's drawing the realities of life to his attention, and he leaves the dinner table. He tries to put up his feet and watch television. [An HON. MEMBER: "People are eating better."] The hon. Gentleman should speak to my constituent. He is not eating better. He is spending more for less.
  Before my constituent turns on the television, he is told by his wife "Turn off one of the lights. You may have had a 96 per cent. increase, but I have just paid the electricity bill, and it has gone up by 177 per cent. in five years of Socialism". He has just paid his television licence, and that has increased by 108 per cent.
  By now my constituent is exhausted by the prospect of trying to live with any more Socialism. He lights his cigarette and turns to his pint of bitter. The cost of cigarettes has increased by 111 per cent. in the past five years and his pint of bitter now costs 107 per cent. more.
  A pay increase of 96·7 per cent. does not begin to look like proof of a successful five-year period to my typical, average industrial worker. His wife asks" What will you do about it? Why don't you write to your MP?" He goes to do so, but then realises that postage has increased by 157 per cent. He thinks to himself "The matter might be urgent, so why not telephone him?" But the telephone bill has gone up by 200 per cent. [Interruption.] It is hard for Labour Members to listen to reality.
  The average increases in the cost of the 12 items that I am talking about is 136 per cent. Therefore, that worker's 96·7 per cent. pay increase does not begin to look worth while.
  My constituent is often told by Labour Members "Forget the wage in your pocket and think of the social wage." He has a grandfather aged 68 who is trying to have a hip joint operation in one of the Croydon hospitals. I ask Labour Members to tell him about the four-year waiting list there. He has children at local schools. He is concerned about standards, but beyond standards he looks at the kind of figures on education capital expenditures produced the other

  803
  day after five years of Socialism in response to a question on 18 January by one of my hon. Friends. Capital expenditures have gone down by 38 per cent. on primary education and they are 42 per cent. down on further education. They are only 49 per cent. of what they were on universities, in real terms. That is the worker's social wage.
  The reality of the kind of Britain that we have produced after the past five years of Socialism is that we have seen a reversal, a stagnation. In a normal postindustrial society one begins to assume that the basic necessities of life start to take a smaller and smaller proportion of the net wage. Under Socialism, the proportion has increased. The average industrial worker and his family are spending more on food than five years ago. That family is now spending nearly 29 per cent. of its budget on food as against 27 per cent. five years ago. It is spending more on fuel. It is spending less on clothing, less on durable consumer goods and slightly less on services.
  Five years of Socialism has produced a society that has materially hurt working people. I know that the Lord President finds it hard to listen and has difficulty in accepting what I am saying, but the reality of price increases is for all to see. Five years of Socialism has hurt working people materially. It has brought to a standstill Britain's attempt to progress into the post-industrial world from the industrial world.
  9.16 p.m.
  Mr. Eddie Loyden: We are probably all aware that the hon. Member for Croydon, Central (Mr. Moore) has been supplied with a brief from Conservative Central Office—
  Mr. John Moore: On a point of order, Mr. Deputy Speaker. I apologise for taking more of the time of the House. I neglected to draw to the attention of the House the fact that the figures that I quoted were produced by the Library.
  Mr. Loyden: The hon. Gentleman made a first-class case in support of the lorry drivers' claim. I noted that he did not say that the Conservative Party has been opposed to price controls since the Government took office. The hon. Member for Gloucester (Mrs. Oppenheim), a Conservative spokesman on prices and consumer affairs, has made it clear that the
  804
  Opposition are opposed to any form of price control. It comes ill from a party that is opposed to any degree of price control to use the House of Commons to talk about price increases. The common agricultural policy has had an adverse effect on food prices. The CAP and other influences have contributed towards increased costs. That has led to a cutback in the living standards of working people.
  It is obvious from the speeches of Opposition Members that they have had no regard to the real issues that have been debated in the House during the past 10 days or two weeks. If they believe that the lorry drivers' dispute came to the attention of the public only 10 or 12 days ago, they have failed to recognise the long negotiations that took place earlier. The road haulage workers were obliged to take action. Opposition Members have not attempted to highlight the claims of the road haulage workers and to give chapter and verse.
  There are two parties involved in the dispute. No comment has been made by the Opposition about the Road Haulage Association. Not one word has been said by them about the second party in the dispute that has had the backing of the CBI—the secondary picketing that has been taking place by employers against road haulage workers. The dispute has been used by the Tory party as a political weapon. The Tories are not looking for a settlement. They are seeking a confrontation with the trade union movement. The are seeking to defeat the trade union movement. During the past 12 days they have pursued a consistent policy of bashing the trade unions.
  The right hon. Lady the Leader of the Opposition has made it clear that she wants not settlements of the road haulage dispute and the dispute of public sector workers but a confrontation with the trade union movement. The Tories think that they could win if a confrontation took place and that they could reduce the powers of the trade union movement. We have heard from Opposition Members about the monopoly power of the trade unions. They did not mention the power of monopoly capitalism.
  The performance of the United Kingdom has been compared with that of other countries. The Dunlop company recently decided to close a factory at Speke.

  805
  The Company has invested in Czechoslovakia, the Soviet Union and Poland. However, British workers are using machines that are 60 years old. That is the equipment being used by Dunlop employers at Speke who are engaged in the manufacture of motor cycle tyres. If one wanted replacements one would have to go to the British Museum to get them.
  That is the role that has been played by British capitalism in the recent past. Conservative Members talk about patriotism, but there is no patriotism on the Conservative Benches. They are the people who send their money to the Cayman Islands, to the Soviet Union, to Czechoslovakia and anywhere else in the world where it can accumulate—
  Mr. Speaker: Order. The hon. Gentleman promised to finish by 9.20 p.m. I merely remind him, because I know that he is being carried away.
  Mr. Loyden: As I said in my opening remarks, Mr. Speaker, this is the second occasion on which I have asked to speak for five minutes. I do not think it is fair. If anything, Members of the Conservative Front Bench have abused normal practice tonight by making speeches lasting 15 to 20 minutes. I appreciate the point that Mr. Speaker has made, and I shall be as brief as possible.
  No Conservative Member has made the point that the lack of investment in British industry is one of the principal causes of today's problems. The Tories are asking British workers to compete with investment in Europe when they know that monopoly capitalism can shift a factory to other parts of the world. Opposition Members all know of the power that exists, where monopoly capitalism can take a firm from the United Kingdom and transplant it to any part of the world.
  While that situation remains we can expect, and will get, a development of monopoly power within the trade unions, because that is the only way in which they can combat the power created by capitalism, which is supported by the Conservative Party. They can combat that power only by creating the same situation for themselves.
  The hypocrisy expressed by Conservative Members has shown the trade union movement quite clearly that a future Tory
  806
  Government are not interested in working with the trade union movement. It has shown that they are out to defeat the road haulage workers and the trade union movement. A future Tory Government will create greater confrontation in this country than has ever been experienced in the past.
  9.22 p.m.
  Mr. John Nott: Although the motion refers to a number of vitally important economic issues, I do not think that this is strictly an economic debate. May I say that we welcome a speech from my hon. Friend the Member for Devizes (Mr. Morrison), even in an economic debate, and I was glad that he opened this debate from the Back Benches on this side of the House.
  This country is not suffering from a financial crisis—yet. That was the message from the Chancellor of the Exchequer earlier in the debate. However, we are suffering from a crisis of authority, and it is on this theme that I want to close the debate from this side of the House.
  The problems which now confront the Government as a result of the events of the past fortnight are, I believe, partly attributable to their economic policies. It is not just that the Government have created an irresistible force by their trade union and labour legislation. It is also because, as one newspaper stated last week, having created that irresistible force, they have sought to turn employers into an immovable object. The Government have sought to do that by their incomes, prices and sanctions policies. Because we have, one the one hand, a near-irresistible force and, on the other, an attempt to create an immovable object, an explosion had to occur. The reservoir was bound to burst.
  Perhaps the rigid 5 per cent. policy was chosen for electoral purposes. We do not know, but there has been no election and it has back-fired upon the Government. I think it would have been remarkable, if past experience is anything to go by, if the usual struggle for differentials and relativities had not generated the serious conflict from which this country is now suffering. The Conservatives were right to criticise the Government for the rigidity of their incomes policy. As for the phrase "a return to free collective bargaining", I see from

  807
  the tomes in front of me that that phrase is used much more frequently by the Leader of the House than it has ever been used by my right hon. and hon. Friends. It was used by him in successive debates not more than a year or two ago.
  The causes of our inflation are many and various. I do not atribute all of them to the Labour Government. I believe that they have had great difficulties with the quintupling of oil prices. But the fact is that they fought the last election by encouraging wage expectations. Then, when the situation exploded in their face, they entered into an arrangement with the TUC—in fact, they sub-contracted the running of this country's economy to the TUC—for two whole years. They have now sub-contracted the enforcement of law and order to the Transport and General Workers' Union.
  Of course, not all the problems that we face today are created by the Government. But, just as they have faced these problems, it is also worth reminding the House that they have also had unique advantages. Just as we have suffered from the greatest inflation in British history, so also have we experienced possibly the single sharpest addition to our national wealth that has ever occurred. I ask the House to remember what was being widely forecast and believed in 1974, namely, that whoever won the 1974 election would be likely to govern this country for at least 10 years because of North Sea oil. Many believed that at the time, and many hon. Members of both parties were saying it.
  The Chancellor today made one of the most useful speeches that I have ever heard him utter. Apart from the opening and closing, which were full of his hectoring and bombast, it was an excellent speech. Its central core was absolutely right. He clearly spelled out the position facing the country and where we stand today if the current crisis is not settled. If only the Chancellor had adopted that tone, instead of pretending repeatedly that every major defeat was a minor victory and that the future contained miraculous recovery, some of our problems would not be so severe today. While he made his predictions, our industrial base has been shrinking and shrinking.
  I do not want to go into the Government's spending plans. But, as my right hon. and learned Friend the Member for
  808
  Surrey, East (Sir G. Howe) said, last year the Government said that the increase in real terms would be about 2 per cent. In fact, it turned out to be between 7 per cent. and 8 per cent. I believe that this year the Government's expenditure plans will have to be revised, whatever the settlements. I leave that there. But, since the outset of the present industrial chaos, the Government have come forward with only one new proposal in relation to economic policy. I believe that proposal to be an insult to the intelligence of the House. We debate it on Monday.
  The Guardian, which is not a Tory newspaper, has described the proposal to abolish profit safeguards as "a futile gesture". Its leader also said:
  "There are occasions when the irrelevant becomes positively insulting".
  That was The Guardian's view of the Bill that we debate on Monday. In fact, its impact on prices in the short term will at the most be about one-tenth of one penny in the pound. Again, this is an exercise in electoral and trade union cosmetics and is an affront to those who look to this Government to arrest the nation's decline by firm action and words.
  At the heart of our dilemma is the fact that, if we erode the incentive to acquire a skill, to work overtime, or to work at all, if we are prepared to go on accepting the immobilities of restrictive practices and the rigidities of the economy, so many of which have been encouraged by the Government—the Employment Protection Act, rent restriction and the Land Commission—that will ensure that our productive potential, which is what this is all about, will in the end keep us at the bottom of the league.
  I could embark upon a whole host of woeful economic prophecies for the future. I shall not do so as the Chancellor's speech has done that effectively. But I would like to assure a sense of balance in the debate by making a short reflection on our history.
  As believers in the authority of government and the rule of law, surely the whole House must find it profoundly disquieting to know that in the past few days this nation has been effectively controlled by strike committees. In common language they might well be called workers' soviets, because that is precisely what they are. At present, these soviets have come near

  809
  to total dominance over the processes of distribution in the country, even if they do not totally control production and exchange. We live in a world of validation certificates. To use the phrase of the hon. Member for Tottenham (Mr. Atkinson), we live in a world in which the permission of the pickets is required to allow essential goods to move in and out of our hospitals, schools and docks.
  We have an elected Government in office, or perhaps it would be more accurate to say a Government who are occupying offices. They are not in office as such. The Government are openly choosing to run the country through these soviets, thereby acknowledging their authority and giving them a legitimacy. That is wholly bad. It is not only bad for the authority of the Government but it is bad for constitutional government in the country in future.
  If I may say so, the occasional mutterings from the bogs of South Down are always a significant echo of some area of public concern. It is appropriate that the right hon. Member for Down, South (Mr. Powell) should choose this week to enjoin us to form ourselves into an alliance with the Soviet Union.
  If I were to seek some comfort from the present situation, it would be this. From the days of the Anglo-Saxon chronicle, there have been constant lamentations about the crises of confidence that have arisen in our affairs, and contemporary historians have continually predicted the imminent collapse of ordered society. The saying in the history books
  "God Almighty have mercy on this wretched place. May Christ establish counsel for his wretched people"
  is almost the repeated authentic voice of contemporary historians since the foundation of our nation.
  In one respect I have been singing the Prime Minister's song. As far as we can see, he believes that it is only by divine intervention, rather than by any act of his, that the good sense of the British people will be restored. If I may say so, in this he resembles a bland and rather elderly suffragan bishop who, as he approaches retirement, displays a rather cynical resignation about the frailties of the human condition. The Prime Minister does so
  810
  of the frailties of the people in this country.
  At the heart of the problem is that, whether we think of the law, medicine, Parliament, the Army, the Church or, now, the trade unions, in this country we have traditionally organised our affairs in a clublike way. In varying ways, the clubs, now the trade unions—[HON. MEMBERS: "No!"] The trade unions are clubs. Like many other of our professional bodies, they enjoy some sovereignty over their members. They decide recruitment and expulsion. They possess legal immunities and privileges, and they maintain their own courts.
  Of course it is true that the justice dispensed in a diocesan court or by the Jockey Club varies somewhat in style and quality from a kangaroo court in a factory—and that was referred to by my hon. Friend the Member for Bury St. Edmunds (Mr. Griffiths). But each and every one of these bodies believes itself to be the best judge in its own cause. It defends its privileges with relentless self-interest, achieving benefits at the expense of people generally, according to strength and ruthlessness.
  The question facing the electorate at this election, no less than in 1974, is whether the British people will accept that another turning point has arrived in our history when a strong central Government must reassert their authority over the private franchises. The British people will have to decide whether they seek a new Government that actually will change, to try to bring it about and perhaps fail, or whether they prefer to face another five years of sermons from a suffragan bishop pussyfooting around the problems, while things increasingly run out of control, giving more and power to militants and Marxists and the small number of people who are out to destroy our society.
  I wonder what the Prime Minister is really thinking. The Labour Government have presided over record inflation, a doubling of our debts in three years—and it took 300 years for them to reach the figure of £26 billion—near-record unemployment and a falling of real incomes. The Chancellor must be about as enthusiastic to present his next Budget as Labour Members are to go through the picket lines, as recommended by the

  811
  Prime Minister. The Secretary of State for Employment has been defended by the Prime Minister. The Secretary of State said that he preferred the advice and recommendations of his hon. Friend the Member for Salford, East (Mr. Allaun) to those of his Cabinet colleagues, but the Prime Minister said that his right hon. Friend had misunderstood the question. I want to know what question the Secretary of State misunderstood.
  Not many weeks ago it seemed that unemployment, inflation, debts and stagnation could all be borne for the friendship, trust and co-operation of the trade union movement. But I turn to Mr. Peter Jenkins to see his comments in The Guardian about the current sitution. The Prime Minister himself presented Mr. Jenkins with an award the other day and in doing so he said that he looked to Mr. Jenkins for enlightenment. He also said:
  "I also read him to find out what I'm thinking."
  The previous day Mr. Jenkins wrote in The Guardian:
  "The trades union connection in which so much has been invested, to which so many concessions have been made, on which so much fulsome praise and favour has been lavished, has turned into an inflationary and disorderly travesty."
  Can anybody doubt that that is the truth?
  I come, finally, to the most important part of the debate—the whole subject of picketing and the rule of law. The right hon. Member for Bermondsey (Mr. Mellish) said that it would be dangerous and terrifying if Government intervention made things worse. He is an ex-Chief Whip and is in a position to comment on the competence of the Government should they intervene. But, taking the point seriously, this is an uncertain and difficult area of the law. It is why we have consistently demanded a clear and unequivocal statement from the Government and the Law Officers of the Crown about what the law really is. But we have had to wait until today. Why did we have to put down a private notice question to get a clear and unequivocal statement. When we were faced with troubles of a rather different sort in 1972 our Attorney-General, Sir Peter Rawlinson, made a statement setting out the law.
  The Home Secretary, who is interrupting me, says he has no power to instruct
  812
  chief constables. We know that perfectly well. In 1972, the then Conservative Home Secretary called the chief officers of police into the Home Office and talked about the need to ensure that picketing was peaceful and lawful. The whole world knew that the Government were behind the forces of law enforcement. The chief constables knew it; the public knew it. But, frankly, until the Prime Minister's personal statement on Tuesday, at Question Time, the Government's position was ambiguous, to say the least. Even now, the whole world knows that the Prime Minister does not speak for a united party. Ultimately, he chooses to remain the leader of the Labour movement and not the leader of the nation.
  I turn againt to Mr. Peter Jenkins, who in that same article said:
  "Mr. Callaghan's dilemma is a grave one. The plight of the country indicates one course of action. The crisis of his party in an election year remains another. Perhaps the tragedy of the current crisis is that Mr. Callaghan is the one person with the personal authority to take the measure of the trade union problem in Britain and carry the public with him—and yet he is constrained by the politics of his party from doing so."
  I believe that is true. It is a really damning indictment of the Prime Minister and his position.
  We had a statement today from the Attorney-General on the law of picketing. I must confess that I think most hon. Members are even more confused now than before he made his statement. The Attorney-General was asked whether intimidation was lawful or unlawful. His reply—I think I paraphrase it more or less correctly—was that it depends whether the intimidation is lawful or not. That is effectively what he said. It was left to my hon. and learned Friend the Member for Royal Tunbridge Wells (Mr. Mayhew) to tell the House about the recent findings of the Court of Appeal and how the Court of Appeal had defined intimidation. Until today, not even Members of this House had had a clear expression of the law from the Government. It was left to my hon. and learned Friend the Member for South Fylde (Mr. Gardner) to make the simple point that, if the law is uncertain, as I believe it is, it should be changed.
  In layman's terms, what we have now is not the rule of law but the rule of lawlessness. It is a shocking thing for the people of this country. There are

  813
  those who say that it is no use passing laws that cannot be enforced; and that, of course, is true. But who is so sure that a clearer and narrower definition of picketing would not be respected and could not be enforced? If the laws of England really cease to express the will of the British people, as expressed through Parliament and developed by the courts, will not the law be brought into greater disrespect? Where else can a free people and a free nation look but to the impartial workings of our courts?
  Throughout the day and throughout the week, my right hon. and hon. Friends have questioned the Government on industrial, legal, economic and commercial questions arising from this crisis. And the Leader of the House is one of the principal architects of this crisis. It is no use being told today that the Government seek to bring forward a voluntary code on picketing. We put forward that proposal during the passage of the Employment Protection Bill. It was the right hon. Gentleman and his right hon. Friend the Secretary of State for Employment who rejected our attempt to bring in a voluntary code for picketing. He turned it down.
  It is no use the Government lecturing us now about a voluntary code. We tried to put one on the statute book. When that measure was going through the House, the Leader of the House actually apologised to his own hon. Friends because he could not revise the law on picketing to enable pickets to stop lorries.
  The Leader of the House was an echo of the trade union movement then and he and the Prime Minister are echoes of the trade union movement now. What the country wants is not an echo but a voice. The country wants to hear the voice of leadership. That is not what is it getting from the Government.
  9.45 p.m.
  The Lord President of the Council and Leader of the House of Commons (Mr. Michael Foot): The hon. Member for St. Ives (Mr. Nott) began his speech with a reflection with which I agree. He said that we were debating matters today which are partly political. They are not solely concerned with economic affairs. I agree with him. We must examine these matters in that light. The country
  814
  faces great political questions as well as great economic dilemmas. The Government have taken that view throughout.
  I have listened to the debate and tried to discover exactly what the Opposition are asking for when they urge the Government to act. In some respects I suppose that they have been asking for the Government to declare a state of emergency. I understand the argument. It is a reputable argument which has occurred on many other occasions in our history. But it is a debatable question.
  Prior to Christmas, particularly when we were confronted with the tanker drivers' strike, we considered carefully, from day to day—as we have continued to consider from day to day—whether it would be wise and right in the interests of the nation as a whole to declare a state of emergency. Of course, if the Government had reached a view that we thought it right, we should not have been deterred for a moment. Indeed, prior to Christmas we made all the arrangements for the declaration of an emergency and for the recall of the House which is required to confirm that declaration.
  If the tanker drivers' strike had continued for 24 hours or 48 hours longer, we should have asked for that declaration of emergency. We could see how the powers of such a declaration would have enabled us not to overcome all the problems of the tanker drivers' strike but to take the elementary powers and requisitional measures to deal with the situation.
  We were fully prepared to do it. We are still prepared to declare a state of emergency if, on balance, we believe that it is the wisest course. We surveyed the situation carefully before and after Christmas. The care with which we approached the situation helped us to overcome the tanker drivers' strike.
  If we had introduced a state of emergency too early, it is possible that we would not have had the considerable co-operation that we had in overcoming the strike. I do not know whether the House thinks that that was wise, but I believe that anybody who examines the facts will accept that it was wise.
  Let us also apply that to the other matters. Indeed, all these considerations overlapped. We had the indications beforehand—before and after Christmas

  815
  —of what the scale, consequences and implications of the road hauliers' strike would be. We examined those day by day as well. We had to make a calculation. Some of the factors that we had to weigh in making that calculation were the consideration of the amount of goods getting through under the present arrangements and the amount of goods that would get through if we made arrangements to prevent picketing that would hold up the operation altogether.
  We had to weigh up those matters against what would have been a small amount of assistance for carrying out work—which could have been provided in any circumstances—by the introduction of the Army. We carried out all these calculations very carefully and we make no apologies for this. It is not the case of a Government not being prepared to take stern action. We had to calculate what the consequences of the action would be and whether that action would achieve what we wanted. Therefore, we believe that on all those grounds it was advisable to take the course that we did.
  We have taken that decision, but I repeat that we continue to examine the matter day by day. If a situation is reached where we would have to take essential measures, we would of course do so. Let me say to Conservative Members that, having taken that decision and having made calculations on the essential supplies and services of the nation—for example, food and pharmaceutical supplies—we were confronted with the situation, which anyone of common sense could see if he applied his mind to it, that if we had discussions with the organisers of the strike, the leaders of the Transport and General Workers' Union, we would get many more goods through. Were we wise to take that course of action?
  If no such discussions had been held, fewer goods would have got through, more people would have been faced with difficulties and more people would have been thrown out of their jobs.
  The implication of the Opposition's remarks is that there is something wrong in the Government's discussing with the trade union involved how we were to deal with these emergency matters. I make no apology for doing so. Any responsible Government faced with that situation would have taken the course that we took
  816
  —especially if such a Government had in its midst the eminent right hon. Member for Lowestoft (Mr. Prior), who, I am sure, would have given the honest advice that he gave in public a few weeks ago. He said that there must be a voluntary agreement and a voluntary code. If there is a need for a voluntary code in general circumstances, is it not needed in a crisis as well? Of course it is. Conservative Members are not facing up to the problem.
  The right hon. and learned Member for Surrey, East (Sir G. Howe) and the hon. Member for St. Ives presented a complete travesty of what is happening in the country. I agree that some of the things that have happened—I am not referring to the road hauliers' strike as much as to some of the other industrial actions that are taking place—are a wicked caricature of trade unionism, and are not genuine trade unionism. I have no compunction about saying that. However, that is no reason why anybody who wants to take wise measures to deal with the situation should listen to the advice of the right hon. and learned Member for Surrey, East.
  The right hon. and learned Member for Surrey. East has been giving advice to the Leader of the Opposition and has, apparently, been listened to rather more than has the right hon. Member for Lowestoft. The House and the country must remember that the right hon. and learned Member for Surrey, East has given us advice on these matters before. He gave us advice on how to deal with the closed shop, but the result was that after his Industrial Relations Act had been in operation, the closed shop extended over a much wider area of industry than it had before. There were many more closed shops at the end than there were at the beginning. Why? Partly because of the poison spread in our industrial system by that Act.
  The advice of the right hon. and learned Member for Surrey East is not, therefore, the wisest advice to take on these matters. Take secondary picketing. So successful was the right hon. and learned Gentleman's Act and the advice he gave to the nation, which, unfortunately, was accepted for a year or two, that secondary picketing was given an enormous impetus. Under his Act, there was a great extension of the closed shop and a great extension of secondary picketing. Whoever else we should listen to, we should not listen to

  817
  the right hon. and learned Member for Surrey, East, any more. One of the problems that we had to face in this area, as in all others, was clearing up the mess left by that Conservative Government.
  I am sorry that many of my hon. Friends were not able to be present to hear the speech of the right hon. and learned Member for Surrey, East. It would have been of great assistance to them, because he gave us one piece of information about pay policy. Although we are discussing political questions, we are also debating the way in which they are interrelated with economic questions, and one of the major aspects of the problem that the House and the country have to face is low pay.
  I have criticised some of the things done by a few trade unionists, but the House and the country have a right to take credit from the lobbying of the House that took place on Monday. No one can complain that that was violent or a breach of law and order. Those public employees came to present their case, and it is a case to which the House must listen.
  For the benefit of the hon. Members who did not hear the speech of the right hon. and learned Member for Surrey, East, let me pass on what he said. The Government have taken steps and are
  taking steps to try to ensure, within the bounds that confine us, that we get fair play for low-paid workers, but the right hon. and learned Gentleman, on behalf of the Opposition, rejected that whole proposition. It is right that the House should know that.
  The right hon. and learned Gentleman is in favour of free collective bargaining, but under his dispensation there would be no free collective bargaining for low-paid workers. We were told that the cause of our problems was the £6 limit, the across-the-board arrangement and the fact that we had secured agreement with the trade union movement. We believe that the trade union movement still occupies and will always occupy a major position in our democratic society and we believe that it is the function of any truly democratic Government to go out and get that co-operation.
  The Conservatives are the dictators. They are the authoritarians. Fortunately, the British people will not give them the chance to do what they intend. When we go to the electorate, we will get a full majority to continue to rule this country on the basis of democratic principles.
  Question put, That the amendment be made:—
  The House divided: Ayes 289, Noes 273.

  Division No. 51]

  AYES

  [10 p.m.

  Abse, Leo

  Callaghan, Jim (Middleton & P)

  Dewar, Donald

  Allaun, Frank

  Campbell, Ian

  Dormand, J. D.

  Anderson, Donald

  Canavan, Dennis

  Douglas-Mann, Bruce

  Archer, Rt Hon Peter

  Cant, R. B.

  Duffy, A. E. P.

  Armstrong, Ernest

  Carmichael, Neil

  Dunn, James A.

  Ashley, Jack

  Carter, Ray

  Dunnett, Jack

  Ashton, Joe

  Carter-Jones, Lewis

  Eadie, Alex

  Atkins, Ronald (Preston N)

  Cartwright, John

  Edge, Geoff

  Atkinson, Norman (H'gey, Tott'ham)

  Clemitson, Ivor

  Ellis, John (Brigg & Scun)

  Bagier, Gordon A. T.

  Cocks, Rt Hon Michael (Bristol S)

  English, Michael

  Barnett, Guy (Greenwich)

  Cohen, Stanley

  Ennals, Rt Hon David

  Barnett, Rt Hon Joel (Heywood)

  Coleman, Donald

  Evans, Gwyntor (Carmarthen)

  Bates, Alf

  Colquhoun, Ms Maureen

  Evans, Ioan (Aberdare)

  Bean, R. E.

  Concannon, Rt Hon John

  Ewing, Harry (Stirling)

  Benn, Rt Hon Anthony Wedgwood

  Conlan, Bernard

  Faulds, Andrew

  Bennett, Andrew (Stockport N)

  Cook, Robin F. (Edin C)

  Fernyhough, Rt Hon E.

  Bidwell, Sydney

  Corbett, Robin

  Flannery, Martin

  Bishop, Rt Hon Edward

  Cowans, Harry

  Fletcher, L. R. (Ilkeston)

  Blenkinsop, Arthur

  Cox, Thomas (Tooting)

  Fletcher, Ted (Darlington)

  Boardman, H.

  Craigen, Jim (Maryhill)

  Foot, Rt Hon Michael

  Booth, Rt Hon Albert

  Crawshaw, Richard

  Ford, Ben

  Boothroyd, Miss Betty

  Cronin, John

  Forrester, John

  Bottomley, Rt Hon Arthur

  Crowther, Stan (Rotherham)

  Fowler, Gerald (The Wrekin)

  Boyden, James (Bish Auck)

  Cryer, Bob

  Fraser, John (Lambeth, N'w'd)

  Bradley, Tom

  Cunningham, Dr J. (Whiteh)

  Freeson, Rt Hon Reginald

  Bray, Dr Jeremy

  Davidson, Arthur

  Garrett, John (Norwich S)

  Brown, Hugh D. (Provan)

  Davies, Rt Hon Denzil

  Garrett, W. E. (Wallsend)

  Brown, Robert C. (Newcastle W)

  Davies, Ifor (Gower)

  George, Bruce

  Buchan, Norman

  Davis, Clinton (Hackney C)

  Gilbert, Rt Hon Dr John

  Buchanan, Richard

  Deakins, Eric

  Ginsburg, David

  Butler, Mrs Joyce (Wood Green)

  Dean, Joseph (Leeds West)

  Golding, John

  Cailaghan, Rt Hon J. (Cardiff SE)

  Dempsey, James

  Gould, Bryan

  Gourlay, Harry

  MacKenzie, Rt Hon Gregor

  Sheldon, Rt Hon Robert

  Graham, Ted

  Maclennan, Robert

  Shore, Rt Hon Peter

  Grant, George (Morpeth)

  McMillan, Tom (Glasgow C)

  Short, Mrs Renée (Wolv NE)

  Grant, John (Islington C)

  McNamara, Kevin

  Silkin, Rt Hon John (Deptford)

  Grocott, Bruce

  Madden, Max

  Silkin, Rt Hon S. C. (Dulwich)

  Hamilton, James (Bothwell)

  Magee, Bryan

  Sillars, James

  Hamilton, W. W. (Central Fife)

  Mahon, Simon

  Silverman, Julius

  Hardy, Peter

  Mallalieu, J. P. W.

  Skinner, Dennis

  Harrison, Rt Hon Walter

  Marks, Kenneth

  Smith, Rt Hon John (N Lanarkshire)

  Hart, Rt Hon Judith

  Marshall, Dr Edmund (Goole)

  Snape, Peter

  Hattersley, Rt Hon Roy

  Marshall, Jim (Leicester S)

  Spearing, Nigel

  Hayman, Mrs Helene

  Maynard, Miss Joan

  Spriggs, Leslie

  Healey, Rt Hon Denis

  Meacher, Michael

  Stallard, A. W.

  Heffer, Eric S.

  Mellish, Rt Hon Robert

  Stewart, Rt Hon (Fulham)

  Home Robertson, John

  Mikardo, Ian

  Stoddart, David

  Hooley, Frank

  Millan, Rt Hon Bruce

  Stott, Roger

  Horam, John

  Miller, Dr M. S. (E Kilbride)

  Strang, Gavin

  Howell, Rt Hon Denis (B'ham, Sm H)

  Mitchell, Austin (Grimsby)

  Strauss, Rt Hon G. R.

  Hoyle, Doug (Nelson)

  Molloy, William

  Summerskill, Hon Dr Shirley

  Huckfield, Les

  Moonman, Eric

  Swain, Thomas

  Hughes, Rt Hon C. (Anglesey)

  Morris, Alfred (Wythenshawe)

  Taylor, Mrs Ann (Bolton W)

  Hughes, Robert (Aberdeen N)

  Morris, Rt Hon Charles R.

  Thomas, Dafydd (Merioneth)

  Hughes, Roy (Newport)

  Morris, Rt Hon J. (Aberavon)

  Thomas, Jeffrey (Abertillery)

  Hunter, Adam

  Morton, George

  Thomas, Mike (Newcastle E)

  Irving, Rt Hon S. (Dartford)

  Moyle, Rt Hon Roland

  Thomas, Ron (Bristol NW)

  Jackson, Colin (Brighouse)

  Mulley, Rt Hon Frederick

  Thorne, Stan (Preston South)

  Jackson, Miss Margaret (Lincoln)

  Murray, Rt Hon Ronald King

  Tierney, Sydney

  Janner, Greville

  Newens, Stanley

  Tilley, John

  Jay, Rt Hon Douglas

  Noble, Mike

  Tinn, James

  Jeger, Mrs Lena

  Oakes, Gordon

  Tomlinson, John

  Jenkins, Hugh (Putney)

  Ogden, Eric

  Tomney, Frank

  John, Brynmor

  O'Halloran, Michael

  Torney, Tom

  Johnson, James (Hull West)

  Orbach, Maurice

  Tuck, Raphael

  Johnson, Walter (Derby S)

  Orme, Rt Hon Stanley

  Urwin, T. W.

  Jones, Alec (Rhondda)

  Ovenden, John

  Varley, Rt Hon Eric G.

  Jones, Barry (East Flint)

  Owen, Rt Hon Dr David

  Wainwright, Edwin (Dearne V)

  Jones, Dan (Burnley)

  Padley, Walter

  Walker, Harold (Doncaster)

  Judd, Frank

  Palmer, Arthur

  Walker, Terry (Kingswood)

  Kaufman, Rt Hon Gerald

  Park, George

  Ward, Michael

  Kelley, Richard

  Parker, John

  Watkins, David

  Kerr, Russell

  Parry, Robert

  Watkinson, John

  Kilroy-Silk, Robert

  Pavitt, Laurie

  Weetch, Ken

  Kinnock, Neil

  Perry, Ernest

  Weitzman, David

  Lambie, David

  Phipps, Dr Colin

  Wellbeloved, James

  Lamborn, Harry

  Price, C. (Lewisham W)

  White, Frank R. (Bury)

  Lamond, James

  Price, William (Rugby)

  White, James (Pollok)

  Latham, Arthur (Paddington)

  Radice, Giles

  Whitehead, Phillip

  Leadbitter, Ted

  Rees, Rt Hon Merlyn (Leeds S)

  Whitlock, William

  Lee, John

  Richardson, Miss Jo

  Wigley, Dafydd

  Lestor, Miss Joan (Eton & Slough)

  Roberts, Albert (Normanton)

  Willey, Rt Hon Frederick

  Lever, Rt Hon Harold

  Roberts, Gwilym (Cannock)

  Williams, Rt Hon Alan (Swansea W)

  Lewis, Arthur (Newham N)

  Robertson, George (Hamilton)

  Williams, Alan Lee (Hornch'ch)

  Lewis, Ron (Carlisle)

  Robinson, Geoffrey

  Williams, Rt Hon Shirley (Hertford)

  Litterick, Tom

  Roderick, Caerwyn

  Williams, Sir Thomas (Warrington)

  Lomas, Kenneth

  Rodgers, George (Chorley)

  Wilson, Rt Hon Sir Harold (Huyton)

  Loyden, Eddie

  Rodgers, Rt Hon William (Stockton)

  Wilson, William (Coventry SE)

  Luard, Evan

  Rooker, J. W.

  Wise, Mrs Audrey

  Lyon, Alexander (York)

  Roper, John

  Woodall, Alec

  Lyons, Edward (Bradford W)

  Ross, Rt Hon W. (Kilmarnock)

  Woof, Robert

  Mabon, Rt Hon Dr J. Dickson

  Rowlands, Ted

  Wrigglesworth, Ian

  McCartney, Hugh

  Ryman, John

  Young, David (Bolton E)

  McDonald, Dr Oonagh

  Sandelson, Neville

  McElhone, Frank

  Sedgemore, Brian

  TELLERS FOR THE AYES:

  MacFarquhar, Roderick

  Selby, Harry

  Mr. John Evans and

  McGuire, Michael (Ince)

  Sever, John

  Mr. Bryan Davies.

  McKay, Allen (Penistone)

  Shaw, Arnold (Ilford South)

  NOES

  Adley, Robert

  Berry, Hon Anthony

  Buchanan-Smith, Alick

  Aitken, Jonathan

  Biffen, John

  Buck, Antony

  Alison, Michael

  Biggs-Davison, John

  Budgen, Nick

  Amery, Rt Hon Julian

  Blaker, Peter

  Bulmer, Esmond

  Arnold, Tom

  Body, Richard

  Burden, F. A.

  Atkins, Rt Hon H. (Spelthorne)

  Boscawen, Hon Robert

  Butler, Adam (Bosworth)

  Atkinson, David (B'mouth, East)

  Bottomley, Peter

  Carlisle, Mark

  Awdry, Daniel

  Bowden, A. (Brighton, Kemptown)

  Chalker, Mrs Lynda

  Baker, Kenneth

  Boyson, Dr Rhodes (Brent)

  Channon, Paul

  Banks, Robert

  Braine, Sir Bernard

  Churchill, W. S.

  Beith, A. J.

  Britten, Leon

  Clark, Alan (Plymouth, Sutton)

  Bell, Ronald

  Brocklebank-Fowler, C.

  Clark, William (Croydon S)

  Bendall, Vivian

  Brooke, Hon Peter

  Clarke, Kenneth (Rushcliffe)

  Bennett, Sir Frederic (Torbay)

  Brotherton, Michael

  Clegg, Walter

  Bennett, Dr Reginald (Fareham)

  Brown, Sir Edward (Bath)

  Cockcroft, John

  Benyon, W.

  Bryan, Sir Paul

  Cooke, Robert (Bristol W)

  820

  821

  Cope, John

  Hurd, Douglas

  Peyton, Rt Hon John

  Cormack, Patrick

  Hutchison, Michael Clark

  Pink, R. Bonner

  Costain, A. P.

  Irving, Charles (Cheltenham)

  Prentice, Rt Hon Reg

  Craig, Rt Hon W. (Belfast E)

  James, David

  Price, David (Eastleigh)

  Critchley, Julian

  Jenkin, Rt Hon P. (Wanst'd&W'df'd)

  Prior, Rt Hon James

  Crouch, David

  Jessel, Toby

  Pym, Rt Hon Francis

  Crowder, F. P.

  Johnson Smith, G. (E Grinstead)

  Raison, Timothy

  Dean, Paul (N Somerset)

  Johnston, Russell (Inverness)

  Rathbone, Tim

  Dodsworth, Geoffrey

  Jones, Arthur (Daventry)

  Rees, Peter (Dover & Deal)

  Douglas-Hamilton, Lord James

  Jopling, Michael

  Rees-Davies, W. R.

  Drayson, Burnaby

  Joseph, Rt Hon Sir Keith

  Renton, Rt Hon Sir D. (Hunts)

  du Cann, Rt Hon Edward

  Kaberry, Sir Donald

  Renton, Tim (Mid-Sussex)

  Durant, Tony

  Kellett-Bowman, Mrs Elaine

  Rhodes James, R.

  Dykes, Hugh

  Kershaw, Anthony

  Ridley, Hon Nicholas

  Eden, Rt Hon Sir John

  Kilfedder, James

  Ridsdale, Julian

  Elliott, Sir William

  Kimball, Marcus

  Rifkind, Malcolm

  Emery, Peter

  King, Evelyn (South Dorset)

  Roberts, Wyn (Conway)

  Eyre, Reginald

  King, Tom (Bridgwater)

  Rodgers, Sir John (Sevenoaks)

  Fairbairn, Nicholas

  Knight, Mrs Jill

  Ross, Stephen (Isle of Wight)

  Fairgrieve, Russell

  Knox, David

  Rossi, Hugh (Hornsey)

  Farr, John

  Lamont, Norman

  Rost, Peter (SE Derbyshire)

  Fell, Anthony

  Langford-Holt, Sir John

  Royle, Sir Anthony

  Finsberg, Geoffrey

  Latham, Michael (Melton)

  Sainsbury, Tim

  Fisher, Sir Nigel

  Lawrence, Ivan

  St. John-Stevas, Norman

  Fletcher, Alex (Edinburgh N)

  Lawson, Nigel

  Scott, Nicholas

  Fookes, Miss Janet

  Lester, Jim (Beeston)

  Shaw, Giles (Pudsey)

  Forman, Nigel

  Lewis, Kenneth (Rutland)

  Shelton, William (Streatham)

  Fowler, Norman (Sutton C'f'd)

  Lloyd, Ian

  Shepherd, Colin

  Fox, Marcus

  Loveridge, John

  Shersby, Michael

  Fraser, Rt Hon H. (Stafford & St)

  Luce, Richard

  Silvester, Fred

  Freud, Clement

  McAdden, Sir Stephen

  Sims, Roger

  Fry, Peter

  McCrindle, Robert

  Sinclair, Sir George

  Galbraith, Hon T. G. D.

  Macfarlane, Neil

  Skeet, T. H. H.

  Gardiner, George (Reigate)

  MacGregor, John

  Smith, Dudley (Warwick)

  Gardner, Edward (S Fylde)

  MacKay, Andrew (Stechford)

  Smith, Timothy John (Ashfield)

  Gilmour, Rt Hon Sir Ian (Chesham)

  Macmillan, Rt Hon M. (Farnham)

  Speed, Keith

  Gilmour, Sir John (East Fife)

  McNair-Wilson, M. (Newbury)

  Spence, John

  Glyn, Dr Alan

  McNair-Wilson, P. (New Forest)

  Spicer, Michael (S Worcester)

  Godber, Fit Hon Joseph

  Madel, David

  Sproat, Iain

  Goodhart, Philip

  Marshall, Michael (Arundel)

  Stainton, Keith

  Goodhew, Victor

  Marten, Neil

  Stanbrook, Ivor

  Goodlad, Alastair

  Mates, Michael

  Steel. Rt Hon David

  Gorst, John

  Mather, Carol

  Steen, Anthony (Wavertree)

  Gow, Ian (Eastbourne)

  Maude, Angus

  Stewart, Ian (Hitchin)

  Gower, Sir Raymond (Barry)

  Maudling. Rt Hon Reginald

  Stokes, John

  Grant, Anthony (Harrow C)

  Maxwell-Hyslop, Robin

  Stradling Thomas, J.

  Gray, Hamish

  Mayhew, Patrick

  Tapsell, Peter

  Grieve, Percy

  Meyer, Sir Anthony

  Taylor, R. (Croydon NW)

  Griffiths, Eldon

  Miller, Hal (Bromsgrove)

  Tebbit, Norman

  Grimond, Rt Hon J.

  Mills, Peter

  Temple-Morris, Peter

  Grist, Ian

  Miscampbell, Norman

  Thomas, Rt Hon P. (Hendon S)

  Grylls, Michael

  Mitchell, David (Basingstoke)

  Thorpe, Rt Hon Jeremy (N Devon)

  Hall-Davis, A. G. F.

  Moate, Roger

  Townsend, Cyril D.

  Hamilton, Archibald (Epsom & Ewell)

  Monro, Hector

  Trotter, Neville

  Hamilton, Michael (Salisbury)

  Montgomery, Fergus

  Van Straubenzee, W. R.

  Hampson, Dr Keith

  Moore, John (Croydon C)

  Vaughan, Dr Gerard

  Hannam, John

  More, Jasper (Ludlow)

  Viggers, Peter

  Harrison, Col Sir Harwood (Eye)

  Morris, Michael (Northampton S)

  Wainwright, Richard (Colne V)

  Harvie Anderson, Rt Hon Miss

  Morrison, Hon Charles (Devizes)

  Wakeham, John

  Haselhurst, Alan

  Morrison, Hon Peter (Chester)

  Walker, Rt Hon P. (Worcester)

  Hastings, Stephen

  Mudd, David

  Wall, Patrick

  Havers, Rt Hon Sir Michael

  Neave, Airey

  Walters, Dennis

  Hawkins, Paul

  Nelson, Anthony

  Warren, Kenneth

  Hayhoe, Barney

  Neubert, Michael

  Weatherill, Bernard

  Heath, Rt Hon Edward

  Newton, Tony

  Wells, John

  Heseltine, Michael

  Nott, John

  Whitelaw. Rt Hon William

  Hicks, Robert

  Onslow, Cranley

  Whitney, Raymond

  Higgins, Terence L.

  Oppenheim, Mrs Sally

  Wiggin, Jerry

  Hodgson, Robin

  Page, John (Harrow West)

  Winterton, Nicholas

  Holland, Philip

  Page, Rt Hon R. Graham (Crosby)

  Wood, Rt Hon Richard

  Hooson, Emlyn

  Page, Richard (Workington)

  Young, Sir G. (Ealing, Acton)

  Hordern, Peter

  Pardoe, John

  Younger, Hon George

  Howe, Rt Hon Sir Geoffrey

  Parkinson, Cecil

  Howell, David (Guildford)

  Pattie, Geoffrey

  TELLERS FOR THE NOES:

  Howells, Geraint (Cardigan)

  Penhaligon, David

  Mr. Spencer Le Marchant and

  Hunt, David (Wirral)

  Percival, Ian

  Mr. Michael Roberts.

  Hunt, John (Ravensbourne)

  Amendment accordingly agreed to.
  Main Question, as amended, put and agreed to.
  Resolved,
  That this House recognises the deep concern felt throughout the country about the current
  824
  industrial situation and supports the Government's determination to maintain essential supplies, control inflation and protect the supreme interest of the community and the legitimate rights of all sections of it.

  STEEL INDUSTRY
  10.18 p.m.
  The Minister of State, Foreign and Commonwealth Office (Mr. Frank Judd): I beg to move,
  That this House takes note of EEC Documents Nos. R/1135/78, R/1221/78, R/1292/78 and R/3454/78 on the Steel Industry.
  Mr. Speaker: I should inform the House that I have selected the amendment in the name of the hon. Member for Sheffield, Heeley (Mr. Hooley).
  Mr. Judd: I shall try in my opening remarks to put these documents in their general context and also comment in some detail on the proposals themselves and the attitude which the Government have taken towards them. However, the main responsibility for our steel policies lies with my right hon. Friend the Minister of State, Department of Industry.
  Mr. John Ellis: On a point of order, Mr. Speaker. Some of us are vitally interested in this matter, but with hon. Members leaving the Chamber it is most difficult to hear the Minister.
  Mr. Speaker: The hon. Gentleman knows that I kept the Minister waiting a little while while hon. Members were leaving the Chamber after the earlier debate. Perhaps I called the Minister a little too soon. I have begun the system of waiting until the House is cleared. It was not done before my time, as the House knows, but I shall follow that rule more rigorously in future.
  Mr. Judd: My hon. Friend the Under-Secretary of State for Industry will reply to the debate and will be able to deal with the detailed Questions raised by hon. Members on this important subject.
  The European steel industry has been particularly hard hit by the world recession. In the light of this crisis, the European Council decided in December 1977 that the steel industry was one of those whose problems warranted tackling at Community level. The first step was to give the industry a breathing space during which the necessary restructuring could take place. To achieve this, the Commission has negotiated a series of anticrisis
  826
  measures, which include agreements on prices and quantities with third countries and on certain minimum and guidance prices for the intra-Community market.
  We in the United Kingdom have always shared the view that anti-crisis measures go hand in hand with the process of bringing capacity more into line with demand. However, we feel that the social aspect of the problem must never be lost sight of and that we must retain control over the way and the speed with which we respond to a developing situation.
  In an attempt to co-ordinate restructuring of the Community steel industry, the Commission has drawn up a set of general objectives. In order to ensure compliance with these objectives, and with the Commission still has to produce, the Commission is seeking agreement to a draft decision intended to enable it to monitor and control all State finance, in whatever form, advanced to steel undertakings.
  The main reason given to justify this proposal is the inflexibility, in the Commission's eyes, of the provisions of the European Coal and Steel Community treaty dealing with State aids to the steel industry. The Commission's purpose in proposing this decision is to establish a Community regime for aids and to prevent member States from using such aids in a way which could thwart Community objectives.
  At the last meeting of the Council of Ministers at which the State aids decision was discussed, my right hon. Friend the Minister of State, Department of Industry explained why this Government have been unable to assent to the Commission's proposals as set out in the draft decision in document R/1135/78.
  The decision would effectively give the Commission overall control of the British Steel Corporation's investment plans and annual operating plan. We have made considerable progress with our national restructuring policy as set out in the White Paper on the British Steel Corporation's road to viability. But it is up to the British Steel Corporation to negotiate closures at its discretion in prior consultation with the Trades Union Congress steel committee and the local work forces. We cannot agree to any procedires

  827
  which would be likely to interfere with this arrangement. Moreover, we are by no means satisfied that the Commission has the resources to deal with the proposals which would have to be notified to it. For this practical reason alone, quite apart from objections of principle, we cannot agree that the Commission should be in a position to hold up advances of finance to the British Steel Corporation pending investigation.
  We have shown ourselves ready in the past to consult the Commission over major new investment projects by the British Steel Corporation. But the present decision seeks specifically to bring advances of working capital to nationalised industries under Commission control without imposing on them any of the penalties to which the United Kingdom Government and the United Kingdom taxpayers are liable as a result of wrong decisions or undue delay.
  The draft decision also seeks to increase Commission control over regional aids. Again, this gives rise to difficulties. We have in general resisted Commission attempts to intervene in the matter of regional assistance, although we accepted a compromise in the special case of the fourth shipbuilding directive.
  The draft decision seeks to ensure that all restructuring of the European steel industry complies with the Commission's restructuring plans. But we do not yet know what these proposed plans are. We must have agreement on these first. Restructuring, particularly closures, raises issues of great social as well as industrial importance. Restructuring decisions cannot, in our view, be taken in a vacuum. This Government will always have high among its priorities the need to deal effectively with the wider social and economic consequences.
  Our legal advise is that the decision as drafted would effect a change in the balance of power between Community institutions. But such a change may be brought about only by a full-scale amendment of the European Coal and Steel Community treaty. It cannot be done under article 95 of that treaty as the decision seeks. To do so would, in our view, be contrary to the wording and intention of article 3.
  These, then, are the arguments against the decision as at present worded which my right hon. Friend the Minister of
  828
  State, Department of Industry has been putting forward with eloquence and conviction—I have had the good fortune to hear him doing it—at meetings of the Council of Ministers.
  At the last Council meeting, a resolution was passed to the effect that the Council is determined to take as soon as possible, and by 1 April at the latest, its decision on Commission proposals concerning State aids for the steel industry. The decision is at present unacceptable to at least one other member State as well as the United Kingdom. It requires the unanimous consent of the Council of Ministers before it can be implemented. This resolution set out general principles on steel aid but gave no Council commitment on procedures or further Commission proposals.
  As hon. Members are aware, the resolution was accompanied by a statement from the United Kingdom to the effect that our attitude to the Commission's proposals was governed by the extent to which the Commission's actions were in accordance with the treaties. We shall continue to examine carefully all proposals put forward by the Commission to ensure that they do not represent a further unacceptable extension of its powers. We shall also contend that article 232 of the EEC Treaty precludes the application of articles 92–94 of that Treaty to European Coal and Steel Community industries, since article 232 specifically states:
  "The provisions of this Treaty shall not affect the provisions of the Treaty establishing the European Coal and Steel Community, in particular as regards the rights and obligations of Member States, the powers of the institutions of that Community and the rules laid down by that Treaty for the functioning of the common market in coal and steel."
  We shall particularly resist any attempt by the Commission to increase its powers with regard to regional aids and any attempt to require prior notification of advances of money to our steel industry.
  I now turn to draft decision R/1292/78. which the Select Committee on European Legislation recommended for debate with R/1135/78, although the adoption of the decision by the Council need not await the debate.
  Mr. Douglas Jay: My hon. Friend has told the House that the Government cannot accept certain proposals of the Commission. Will he

  829
  assure us quite clearly that the Government will not accept them?
  Mr. Judd: I hope my right hon. Friend will agree that I made it perfectly clear that we are not prepared to breach the provisions of the treaties as we understand them.
  The effect of that draft decision would be to allocate to the Community all the receipts from customs duties levied on imports from third countries of European Coal and Steel Community products. At present those revenues, unlike the receipts from customs duties on EEC products, are retained by member States.
  The reason for this proposal is the substantial additional expenditure incurred by the Commission in order to counter the effects of the steel recession. This consists mainly of a Community contribution towards resettlement aid to redundant steel and coal workers, and interest relief grants given on European Coal and Steel Community loans made towards the cost of projects to modernise steel and coal production and to employ redundant steel and coal workers. An example is the ECSC loan of £78 million recently approved towards the cost of the Ford Motor Company's projected new engine plant in South Wales.
  It is not surprising that the large numbers of redundancies in the EEC steel industry have led to increased expenditure. Indeed, a problem has already been faced with the 1978 European Coal and Steel Community budget. Expenditure, at about £103 million, was about £26 million more than in 1977, even though the contribution made by the European Coal and Steel Community to the general EEC budget towards the administrative expenses of the Commission was reduced from £12 million to £3 million.
  Under the treaty, Community expenditure is financed by a production levy on the steel and coal industries. The current difficulties of the steel industry make it undesirable to raise that levy. The Council of Ministers therefore decided in principle on 20 December 1977 that member States should make an additional contribution totalling 32 million European units of account. The allocation first proposed by the Commission was in proportion to national receipts from customs duties on
  830
  European Coal and Steel Community products. The Commission later proposed an allocation based on gross national product. It was in this form that the Select Committee on European Legislation considered the proposal—the relevant document was R /674/78. I refer to the 27th report of the Select Committee on European Legislation, Session 1977–78.
  Agreement was finally reached only in October 1978 in a last-minute compromise under which the United Kingdom share is 17·4 per cent. The United Kingdom will benefit and is expected to receive some 34 per cent. of the total Community expenditure on resettlement aids and interest relief grants in 1978, as well as a continuing share of European Coal and Steel Community research grants.
  The contribution towards the 1978 budget takes the form of an ad hoc decision by member States meeting in Council on 30 October 1978. An Order in Council specifying this decision as a treaty under section 1(3) of the European Communities Act 1972 will shortly be presented for parliamentary approval. No agreement has, however, yet been reached in the Council on the proposal to transfer future receipts from customs duties on European Coal and Steel Community products to the Community. This would provide something of the order of 60 million European units of account a year.
  We and a number of other member States have reservations. It is not certain that Commission expenditure need be maintained at such a high level over a long period, and it does not follow that the deficit in any year will be matched by the customs receipts. Moreover, the amount of duty collected does not correspond necessarily to individual member States' ability to pay or the needs of their industry.
  However, the Commission faces a problem in balancing the 1979 budget. At the Council on 18–19 December last, member States, other than France, were willing in principle, but subject to the necessary budgetary and parliamentary procedures, to make a further ad hoc contribution in 1979. This will, of course, need further discussion in the Council.
  The Select Committee on European Legislation also recommended draft decision document No. R/1221/78 for debate, although it said that adoption of the

  831
  directive need not await the debate, and on 17 January it likewise recommended document No. R/3454/78. The purpose of the former instrument was to amend an earlier decision which required iron and steel dealers to conform to Community producers' list prices when making ex-stock sales of the steel products for which Community producers were subject to mandatory minimum prices. It also required dealers to issue certificates of conformity.
  Document No. R/1221/78 provides for the extension of these requirements to direct as well as ex-stock sales. This was clearly only reasonable, as otherwise the mandatory minimum prices could be undermined by dealers' sales. I think that it is still as important as ever to ensure that the minimum prices for producers are not undermined at a time when market conditions are still putting heavy pressure on steel prices. Document No. R /3454/78 adds certain other products to the list of those for which dealers must not charge less than the Community producers' list price.
  I hope that this introduction will have helped to clarify what the Government regard as the main issues raised by the documents under debate. Of these three proposals, it is the steel aids decision that causes us the greatest difficulties. The success of the anti-crisis measures show the value of tackling the problem of the steel industry and the world recession at Community level. Naturally, there has to be some co-ordination of the restructuring that must follow these measures. But we in the Government are not prepared to accept proposals that would go beyond the powers provided by the treaties in their present form or lead to interference with our policies for dealing with the problems of the United Kingdom steel industry as we ourselves see fit.
  Mr. Deputy Speaker (Sir Myer Galpern): May I remind the House that the debate can last for two and a half hours only? Almost every hon. Member present in the Chamber has a steel interest, and in order to accommodate as many speakers as possible I appeal to hon. Members to make their speeches reasonably brief.
  10.36 p.m.
  Mr. Frank Hooley: I beg to move, at the end of the Question, to add:
  'but cannot accept proposals which would curtail assistance to and investment in the iron and steel industry and would damage employment in that industry.'
  This is an extremely important debate. Should the Council of Ministers by any mischance approve the decision that we are now discussing, and which in effect is set out in document No. R/1135/78, the matter would be out of the control of the House altogether, and so would the steel industry. In that event, no legislation by this House would be required if by some mischance this decision were approved.
  The key to the matter lies in article 1 of the draft proposal. I should like to quote part of the text, which states:
  "Aids and interventions in favour of the steel industry, financed or provided by Member States or through State resources in any form whatsoever, may be considered compatible with the orderly functioning of the common market if they satisfy the provisions of this Decision and if they do not affect competition and trade between Member States to an extent contrary to the common interest. Such aids and interventions shall only be put into effect in accordance with the procedures established herein."
  Therefore, wide—ranging powers over the steel industry would pass from the control of this House and this country to the Commission should this decision in any way be implemented. In some ways, the interesting part of document No. R/1135/78 is not so much the text of the decision as the preceding memorandum, which makes a number of quite astonishing statements. For example, it states that it is necessary.
  "to create new rules… for the supervision and control of aids and interventions in favour of the steel industry".
  Apparently, the powers which already exist do not satisfy the Commission. It makes an equally remarkable statement with regard to regional aids. It states that regional aids
  "are not always in the real interest of the regions".
  In other words, it suggests that the Commission in Brussels should have the power to determine whether the regional aids that this House may wish to give to particular regions are actually in the interest of those regions. I suggest that that is

  833
  a matter for hon. Members to judge, and not for the Commission.
  Mr. Hugh Dykes: When the hon. Member speaks of the Commission imposing rules on us, does he not appreciate that British officials are involved in the Commission? All the member States are involved, and the Commission therefore represents all the countries. When there is gross overcapacity in the steel industry, it is rational and sensible to act in concert to reduce the difficulties.
  Mr. Hooley: I still do not accept that the Commission has superior wisdom in considering regional aids. That wisdom lies with this House. The power should be exercised by the House and not by the Commission.
  Mr. David Watkins: On the point raised by the hon. Member for Harrow, East (Mr. Dykes), will my hon. Friend bear in mind that members of the Commission are not there as representatives of their countries? They have to renounce such representation as members of the Commission.
  Mr. Hooley: I am grateful to my hon. Friend. That is absolutely correct.
  The memorandum goes on to say that it is
  "unacceptable for Member States to have complete discretion to use their regional aid systems"
  That is an astonishing doctrine. It further states that
  "In the case of public undertakings the provision of finance must be supervised by the Community".
  In other words, in important respects the operations of the British Steel Corporation would come directly under the supervision and control of the Commission. But it goes beyond State finance. It states that
  "aids and interventions by local authorities or parastatal institutions"
  have to be brought under control. That means that if the NEB became involved in the steel industry, its activities would also fall under the control of the Commission.
  My hon. Friend the Minister in opening the debate did not mention the cost level at which this control would apply. I understand that it is 5 million units of account, which is around £3 million. Any
  834
  project in the steel-producing industry which exceeded £3 million would therefore become subject to control.
  I am not sure whether aids for social costs and closures would be controlled by the Commission, but they would have to be monitored and reported to the Commission. Likewise compensation, financial arrangements or reduction in capacity would fall under the control of the Commission. The most astonishing aspect is that, even if a country had to take emergency action to rescue a plant or sort out some other difficulty, the Commission would insist that that action was strictly controlled and confined to the immediate difficulty.
  The impact on our law and rules would be considerable. That is fairly pointed out by the covering document which the Department of Industry has provided for the House. It would limit the powers of the Secretary of State to provide funds under sections 17 and 18 of the Iron and Steel Act 1975. It would limit regional development grants under sections 7 and 8 of the 1972 Industry Act, which was passed by the Conservative Government. It would have an impact not only on the British Steel Corporation but on private steel producers.
  The covering memorandum from the Department of Industry points out that as long as we belong to the EEC these limitations will apply to any other present or future United Kingdom legislation. This decision would have a far-reaching impact on important legislation already passed by the House in respect specifically of the iron and steel industry and, more generally, aids to industry at large. About 50 per cent. of the British Steel Corporation's investment programme over the next five years would be affected. Government assistance to private sectors would be subject to Commission control, and the operation of loss-making undertakings also would be affected.
  The British Steel Corporation has made it perfectly clear by its policy and its actions—which have been thoroughly debated in this House—that there is a need for restructuring in the industry. Very hard decisions have been taken and more difficult ones may he ahead. I am quite sure that the Corporation, the Department of Industry and this House recognise the far-reaching restructuring that needs to be done and has already been done.

  835
  Apart from restructuring, there is the question of modernisation and new investment. This is extremely important. In 1976–77, £579 million new capital investment was carried through. In 1977–78, the figure was £480 million. In Sheffield we have the enormously important stainless steel project at Shepcote Lane costing £140 million, which is now coming on stream and proving extremely effective and successful. We have the arc furnaces at Aldwarke, the continuous casting plant at Templeborough and the River Don works, which five years ago were almost run down and are now operating very successfully and capturing contracts in the international market in the face of international competition.
  In the period between 1970 and 1976, £160 million was invested by the special steels division in Sheffield, and last financial year the figure was £74 million. There have been important investments in the private sector in Sheffield as well. In Johnson, Firth Brown and in Dunford Elliott we have had very expensive and highly sophisticated forging machines, electroslag refining equipment and vacuum degassing equipment as well as other important investment. This would certainly have fallen under the supervision and control of the Commission had these projects been carried through when this decision was effective. I must emphasise that if this provision were carried through, the House would have no further control. No further legislation would be needed to put this into effect once the Commission had taken the decision.
  In some ways, document R/1292/78 has a more fundamental principle than the other. It wants to extend to steel the absurdities that we have encountered from the levy system of finance which exists in the common agricultural policy. This would be a new departure—a very important and dangerous one, because the customs duty which is at present applied to steel products by the individual member States would then form part of the "own revenues" of the community and would pass totally out of our control. The only way one can control this bureaucracy is to control its money. If we allowed the principle set out in R/1292/78 to go through, an important precedent would be established. Not only in agriculture, but also in industry we would have the levy and the own resources
  836
  principle pushed in and the Commission would have its foot in the door.
  These documents have very important constitutional and financial implications for this House. I believe that they set a dangerous precedent, and I hope that the Government will accept our amendment. I hope also that they will continue to indicate that we will resolutely resist the propositions contained in the documents.
  10.49 p.m.
  Sir Anthony Meyer: It is easy to find objections to the proposal to put aids to the steel industry on a European basis, but the hon. Member for Sheffield, Heeley (Mr. Hooley) has done so with his customary moderation, eloquence and knowledge of the industry. I have no doubt that he will be followed by others producing objections in less restrained language, portraying not so much an anxiety about the future of the steel industry as a determination to get Britain out of the EEC. We shall hear a good deal in the debate, and, indeed, we have heard from the hon. Member for Heeley—
  Mr. Deputy Speaker: Order. I am sorry to interrupt the hon. Gentleman. He has made two suggestions to the House, one on the future of the steel industry and the other relating to Britain coming out of the EEC. I remind him that the debate should centre on the likely effectiveness of the Community proposals. I hope that hon. Members will address themselves to that matter.
  Sir A. Meyer: I assure you, Mr. Deputy Speaker, that I intend to stick closely to the matter before the House.
  We heard a good deal from the hon. Member for Heeley and will, no doubt, hear more about the importance of allowing the British Steel Corporation to decide its own strategy. This makes a change. I have heard many objections from hon. Members on both sides of the House and I have myself voiced objections to the determination of the British Steel Corporation to push ahead with plans for the modernisation of the industry entailing massive closures of out-of-date plant. One of those plants, Shotton, is near my constituency. It is likely to be affected by the determination of the Corporation to phase out the production

  837
  of steel except at five integrated steel plants.
  Despite the plausibility of the objections to the proposals of the Commission for putting aid to the steel industry on a European basis, nobody can now seriously argue that the United Kingdom can sustain a steel industry on anything like the scale envisaged at the time when the 10-year strategy for steel was drawn up in 1972.
  Mr. Jay: It is a temporary recession.
  Sir A. Meyer: No, it is not a temporary recession. It is very far from being a temporary recession. It is not a cyclical recession but a permanent shift in the balance of production on a global basis.
  Mr. Jay: Nonsense.
  Sir A. Meyer: Hon. Members fail to realise what is happening in Korea and other developing countries. With modern plant and a highly skilled, work-devoted labour force, they will push not only British but also European steel production over the edge unless we can consolidate and concentrate and hit back at that competition with the most modern equipment and the most modern methods.
  It is nonsense to suggest that this is a temporary recession caused by a fall in world demand. If any kind of steel industry is to be maintained in the United Kingdom, it will have to be a protected industry. Anyone who supposes that this nation alone can afford to protect a steel industry even of the modest size that we will need for our strategic needs and to provide employment in the areas where there are no other job possibilities is being wildly unrealistic.
  It is an immensely expensive business to protect a steel industry. It requires a vast transfer of resources from the profits of other industries. It is beyond the capacity of this country to protect a steel industry of the size, even the small size, that we shall need for the two purposes that I have outlined—namely, for our essential strategic need and to provide employment in the areas where there is no other source of employment.
  If there is to be the protection that will enable us to keep the steel industry going, clearly it must be on a European basis. A British share of a European
  838
  steel industry, although small, will be a great deal larger than the type of British steel industry which we could maintain and protect by our own unaided efforts. That means that we have to accept the concept of a European basis for a British steel industry.
  I have no hesitation in advocating that and accepting the logic of it. I do not pretend that I do so without misgivings. Of course I have misgivings. I am not at all happy about the spirit in which the Community has approached the problems of regional aid so far. We do not consider that the Community attributes enough importance to the need to develop the outlying regions where so much of the British steel industry is situated.
  In this matter the Commission's record is a good deal better than the Council of Ministers' record. If I had to rely on the good intentions of one body rather than the other, I should much prefer to rely on the good intentions of the Commission. [HON. MEMBERS: "Rubbish."] I sometimes wonder about the cloud-cuckoo land in which Labour Members live. They seem to imagine that because the United Kingdom has a right to veto in the Council of Ministers, we can somehow protect our interest better there. They forget that there are eight other members who also have the power of veto and who are equally determined to maintain their vital interests by using that veto. They ignore that the Commission, which has no such power of veto, is dedicated to the well-being of the Community as a whole. A body which seeks the common good inevitably brings greater benefits to its members than one in which the principle of dog eats dog operates, as it does within the Council of Ministers.
  I have reservations. I wish that the Community had a better track record on regional development. Aspects of the document make me uneasy. But I have more confidence in the ability of the Community to protect the British steel industry than in the ability of Britain alone to do so. And I have 10 times more confidence in the good will of the Commission in its attempts to create a steel industry which is of benefit to all its members than I should if the process were left to the Council of Ministers in which the veto operates.

  839
  Therefore, not without misgivings, I should like the recommendations to be accepted. I am sorry that the Government are adopting such a reserved attitude.
  10.59 p.m.
  Mr. Allen McKay: I believe that nothing is beyond the capacity of the nation when it gets its head down. In my maiden speech I said that the steelworks in my constituency were the best in the world. I referred to the need for investment in British Steel at Stocksbridge as being vital not only for the rehabilitation of the works but to increase the morale of an excellent work force in recognition of the good industrial relations between management and men at that works. It was needed also because without that steelworks a township would have stagnated and died.
  I am very pleased that it has been announced, this week, that there is to be a £21 million investment scheme for that steelworks for tube steel production. and Stocksbridge works has thus been given a new lease of life. We have done that without the aid of the Community.
  In the words of John Pennington, managing director of the Sheffield division:
  "This important development is a vote of confidence in the future of steel production in the Stocksbridge area which has a long and proud history of achievement and is very good news at a time when our industry is faced with enormous difficulty. We look forward with confidence when the new technology begins production."
  This in itself is an achievement in co-operation by the trade unions, management, this House and British Steel. It has only been marred recently by the news that 14,000 men are likely to be laid off very soon through no fault of their own.
  The steel industry is going through a period of reconstruction, which includes closure of plants, with consequent redundancies and social problems. But, again, with the co-operation of British Steel, management and men, we shall get over it, in the same way as the mining industry, which went through a similar period, which we overcame.
  This development is being carried out quietly and successfully, in order to create
  840
  from the legacy that was—a dying industry—an emergent, flourishing industry, helped by investment and grants decided by this House and by British Steel. The price of reconstruction is heavy, in terms of both men and finance, but out of it will come a strong and viable industry which will compete, unafraid and in competition on equal terms, with anything else in the world.
  That is being done in a period of world recession, over-production and lack of stability. But the competition has not always been fair. Many of my hon. Friends on this side of the House have held meetings with Ministers, together with various local authorities, to try to overcome this problem. I am grateful to the Minister for the way he has helped in these cases.
  We are competing with cheap steel being sold at less than production cost and being dumped in this country from outside and within the Community. However, by 1981, because of the policies of the present Government and the efforts of the steel industry, we shall be clear of this problem and the position will be very much altered.
  We are grateful to the Minister and to Viscount Davignon for the way in which they have brought sanity to steel industry pricing and for bringing in a measure of stability.
  It is in that context that I view the problems—which could be grim—which might be caused by the measures proposed in the Commission decisions which are contained in the documents before us. While accepting the intention in the decision and acknowledging the help given by the Commission, I cannot accept the present proposals, which interfere with British efforts to put our own steel industry in order and to make our own decisions as to where and when investment should take place and regional grants should be given.
  The decision on the restructuring of British Steel is a domestic one, to complete existing projects, make essential replacements and improve quality. To accept a position in which the Secretary of State would have the power to provide funds to the Corporation only subject to the approval of the Commission, and which would lessen his power to make regional grants, is not in the best interests of the country or of the industry.
  Mr. Tim Renton: I am following with interest what the hon. Gentleman is saying. Can he explain why he says that the decision to invest in British steel is entirely a domestic one when the BSC is a large exporter and has frequently made clear that its decisions to invest are dependent on its obtaining a substantial share of export markets?
  Mr. McKay: I said that where to invest is a domestic decision because of the social consequences. It is not a European decision.
  The Commission's proposals would be detrimental to this country and our steel industry and would be a setback for the industry in general. I would co-operate in any scheme to strengthen the industry, but I believe that the Commission's decision will weaken the industry and I back the Minister in his intent to keep the British Steel Corporation British and to keep our investment British.
  11.6 p.m.
  Mr. Neil Marten: I am grateful to be called, because I do not have a steel constituency. My constituency rolls aluminium, and I am fairly ignorant about the steel industry.
  However, I am a member of the Scrutiny Committee and I thought it right to explain why the Committee referred the proposal to the Floor of the House. When the Leader of the House announced this debate last week, he referred to the relevant EEC documents. I wish that he had mentioned the Scrutiny Committee's report so that hon. Members could be made aware of our criticisms of those documents.
  We said of document R /1135:
  "The effect of this proposal appears to be to deprive Member States of the ability to assist their steel industries, except by Commission approval."
  That was why we felt it right that the proposal should be debated on the Floor of the House.
  We do not want to give any more power to the bureaucrats in Brussels. They have too much already. It is absurd that power drips week by week from this House to the Commission. I want to speak in defence of our Parliament. We should not constantly give away more power.
  842
  I felt like making the same intervention as that made by the right hon. Member for Battersea, North (Mr. Jay) when the Minister said that the Government "cannot agree" with the Commission's proposals. He sounded tough, and I do not want to call his remarks weasel words, but why did he not say that the Government "will not agree"? There is a big difference there.
  The Minister also said, in trying to give the impression of being tough and standing up to the Commission, that the Government "will resist" the proposals. Why did he not say that they "will oppose" them?
  Mr. Stan Crowther: The Government should veto them.
  Mr. Marten: Either word—"oppose" or "veto"—would strengthen the genuineness of the Minister's speech.
  If I may address myself to my Front Bench, I must say that it seems odd that the Conservative Party is not opposing all this price fixing. I know that the industry is in difficulties and that price fixing may be one way to help, but it is a strange Conservative philosophy not to oppose the formation of a cartel which fixes prices. In the recent history of this century, such action has caused great trouble in Germany and central Europe
  Is there not the adoption of a double standard, in a way, over this price fixing, because it is against competition? Our interpretation of article 3 of the Treaty of Rome is that it stands for the establishment of a system ensuring that competition in the market is not distorted. Surely this is distortion, and it is to these constant double standards that I object. We were told that if we acceded to the Treaty of Rome there would be all those wonderful opportunities, but when it suits the Commission or anybody else they go right against the principles of the Treaty of Rome. I find it rather hard that my own Front Bench colleagues condone that behavour when they ought to be attacking it.
  Mr. Jay: Does the hon. Gentleman recall that recently the Commission wanted to close down the Milk Marketing Board because it infringed the laws of competition? Now it is establishing a cartel in the steel industry.
  Mr. Marten: That is yet another example, and a very good one, of going against the principles laid down in article 3 of the Treaty of Rome. I quite agree.
  Finally, in document R/1292 there are two rather un-Conservative things which I hope will be opposed by the Conservative Front Bench. One is that this decision would result in the loss of to the United Kingdom Exchequer of the revenue at present derived from customs duties, which in 1976 amounted to £12·2 million and in 1977 to £9·6 million. The transfer to the Coal and Steel Community of the receipts from these duties would increase the public sector borrowing requirement. My hon. Friend the Member for Mid-Sussex (Mr. Renton) is always speaking about cutting down the public sector borrowing requirement. I hope, therefore, that we shall hear from him that he opposes this proposal.
  11.13 p.m.
  Mr. David Watkins: The hon. Member for Banbury (Mr. Marten) has, as always, put very cogent and penetrating arguments to the House. He was speaking, as he said, as someone who does not represent a steel constituency. I, as representing a steel constituency, have pleasure in following him, and I support the amendment put forward by my hon. Friend the Member for Sheffield, Heeley (Mr. Hooley).
  Each of these EEC documents has some represensible feature, but document R/1135, dealing with aid and intervention in favour of the iron and steel industries, has, as my hon. Friend the Minister of State said in opening the debate, some particularly reprehensible features. I accept that he did not use the word "reprehensible", but he implied that it had especially reprehensible features in regard to interference in the British Steel Corporation, and especially in those sectors of the iron and steel industry in this country which are situated in development areas and in assisted areas.
  The introduction to the document indicates first that the restructuring of the industry should not be impeded by measures taken by member States. It also points out that the Community is not in a position to meet all the industry's requirements for assistance. The net result of that is that the steel industry in regional
  844
  areas and assisted areas would get the worst of all possible worlds. The Community may not be able to help as an entity, and at the same time, in these draft directives, the Commission wants the power to prevent member States from using their own resources for self-help. If the draft decision were adopted as it is presented before the House this evening, even short-term emergency aid in particular areas would be required to be notified to the Commission and negotiated with it.
  In view of the slow and ponderous bureaucracy of the Commission, it is surely the case that even if it came to a favourable decision on an emergency matter which was referred to it, by the time it came to a decision the emergency would in any event be over, the plant would be closed, the people would be out of work and any steel town which was heavily dependent, as so many steel towns are, upon its steel plant would be turned into a state of industrial dereliction. This is quite unacceptable to the House.
  As drafted, the document also requires every investment project exceeding 5 million units of account to be subject to Commission approval. That, taken together with the provisions for emergencies, would virtually wipe out major parts of the British steel industry, which, as far as I could see, was what the hon. Member for Flint, West (Sir A. Meyer) appeared to be advocating and wanted to take place.
  My hon. Friend the Under-Secretary of State for Industry—the hon. Member for Nuneaton (Mr. Huckfield)—will be aware that on 14th February I shall be bringing to see him a deputation composed of representatives of the Derwentside district council and the Durham county council to represent to him, and through him to my right hon. Friend the Secretary of State, that there is an urgent need for special attention to the situation, which is of emergency proportions, in Consett. That is why I am particularly concentrating on and using my constituency to illustrate the emergency side of the proposals.
  In Consett we have a steel plant in a special development area, where 50 per cent. of all the registered employed persons in the town are employed in the steel industry and another 25 per cent. are employed in industries directly dependent

  845
  upon steel. Three-quarters of the people of Consett are dependent for their livelihood on this industry. At the Consett plant there were nearly 1,000 redundancies last year and more are expected this year.
  It really would not be acceptable if we were to be told when we meet my hon. Friend the Under-Secretary on 14 February that the only power that the Government have would be to submit a case about our representation to the Commission, which might or might not approve of the case for emergency help which was submitted to it, and which might or might not approve it for six months, 12 months or perhaps two years. Whatever my hon. Friend tells us on 14 February, we really want something much more positive than that.
  In response to your request for brief speeches, Mr. Deputy Speaker, I conclude by saying that the House must send these documents back to the place from whence they came. The British Steel industry is already seriously threatened by the world recession. Many steel towns are facing emergency situations. Indeed, it could be said that the whole industry is facing an emergency situation. We really must send the documents back and say that we are not prepared to accept these restrictions on our own capacity to help ourselves.
  11.17 p.m.
  Mr. Tim Renton: Unlike the hon. Member for Consett (Mr. Watkins), I do not represent the steel industry. There used to be an iron industry in Sussex many years ago, but that is no more. However, I fought a Sheffield seat against a neighbour of the hon. Member for Sheffield, Heeley (Mr. Hooley) in 1970. Also, for many years I worked for a firm which supplied the steel industry with its raw materials. With some of the Labour Members who are now in the Chamber, I was a member of the Select Committee which looked at the British Steel Corporation over an extensive period which ended with our reports of a year ago.
  In the course of my working life before becoming a Member of this House, I had the privilege of representing British steel companies abroad as their export agent—United Steel Company, Stewarts and
  846
  Lloyds, and John Summers—and I was very happy in those years to get to know the excellence of British steel. I speak, therefore, with some past knowledge of the British steel industry, as does my hon. Friend the Member for Arundel (Mr. Marshall).
  I find it extraordinarily hard to understand the ambivalence, the double attitudes, of Labour Members in relation to the motion to approve these EEC documents and the amendment moved by the hon. Member for Heeley. Everyone knows that the British Steel Corporation is deeply grateful for the measures which have been taken by the EEC Commission to support the European steel industry over the last two years. Everyone knows that the British Steel Corporation would like those measures to be extended. Everyone who knows the steel industry knows that the BSC is not an island unto itself.
  Contrary to the remarks made by the hon. Member for Penistone (Mr. McKay), the BSC today cannot by itself decide where its investment is to take place. There is no point whatsoever in the BSC building another cold steel production mill or another special steels plant if similar plants are being built in Belgium, France, Germany, Mexico and Korea, because that is bound to lead to surplus capacity which will depress world prices.
  The BSC—again, contrary to what the hon. Member for Penistone said in answer to my question—depends on exports for a substantial part of its intended sales—I stress "intended"—so it cannot be oblivious in its investment decisions to similar investment decisions which have been taken in other parts of the world, notably within the EEC. Therefore, the management of BSC, as we know and as the hon. Member for Brigg and Scunthorpe (Mr. Ellis) certainly knows, is very relieved at the protective measures that the EEC has undertaken in the last two years.
  Mr. John Ellis rose—
  Mr. Renton: When I have finished this point, I shall gladly give way to the hon. Gentleman.
  I profoundly disagree with my hon. Friend the Member for Banbury (Mr. Marten) about our membership of the EEC, because I am a firm supporter of it, but he made a valid point when he

  847
  said that he found it somewhat ambivalent of us to support protectionist measures. I agree that that is an ambivalent attitude, but, in terms of the British steel industry and the protection of its markets and, therefore, to some extent, of its employment, where would the BSC be today without the Davignon proposals? It would be in a far greater mess and would have made a far greater loss than it has made.
  Mr. John Ellis: The hon. Gentleman referred to me by name. We all want to debate these important matters, so I shall be brief. I rather oppose the hon. Gentleman. He must not put words into my mouth—"as the hon. Member for Brigg and Scunthorpe (Mr. Ellis) knows". I know nothing of the kind. If there were not Davignon, we would work out our own salvation. I shall make my own speech, thank you very much.
  Mr. Renton: I obviously made a mistake in giving way to the hon. Member. It is a pity that he rose to intervene. He could have made that point later.
  The hon. Gentleman said that we would work out our own salvation. He thinks so. I do not know of anyone in the European steel industry who thinks so. Today, in Europe alone, there are 40 million tonnes of over-capacity. I am not talking about the whole of the world to which the BSC wishes to export. How in those circumstances, when steel is an internationally traded commodity, are we to work out our own salvation?
  Mr. Hooley rose—
  Mr. Renton: I know that the hon. Gentleman has great knowledge of this subject, but I do not want the same kind of intervention as I had from the hon. Member for Brigg and Scunthorpe.
  Looking at what has been done to reduce capacity in Britain compared with our European neighbours, it is clear that we have not gone nearly as far as they have gone. According to figures released not long ago by the British Iron and Steel Consumers' Council, since 1975 the United Kingdom has reduced its steel work force by 5 per cent. compared with 8 per cent by West Germany, 15 per cent. by France, 18 per cent. by Belgium, 22 per cent. by Luxembourg and 23 per cent. by the Netherlands. That implies not only a greater continuing inefficiency in the
  848
  United Kingdom than in our Continental neighbours but that they have gone much further down the road of reducing overcapacity than we have.
  Therefore, I find in the amendment moved by the hon. Member for Heeley an extraordinary reluctance to face the fact that the British Steel Corporation cannot continue to consider itself as the largest single steel producer in Western Europe—an isolated entity not affected by investment decisions taken on the other side of the Channel.
  The amendment is typical of the attitude of Labour Members who wish to attack the Common Market and who wish to be totally anti-EEC in their attitude and in their approach to what Viscount Davignon has done. If, however, they succeed, they will end by destroying the British Steel Corporation.
  Mr. John Ellis: Nonsense.
  Mr. Renton: The hon. Gentleman may shout "Nonsense", but nobody in BSC top management regards it as nonsense. The BSC cannot be isolated from developments in the Community. Those developments are essentially of benefit to the Corporation. If hon. Members doubt that, I suggest that whoever speaks next from the Labour Benches—perhaps it should be the hon. Member for Brigg and Scunthorpe—
  Mr. Deputy Speaker: Order.
  Mr. Renton: I do not wish to usurp the prerogative of the Chair. As one who knows the industry very well, perhaps the hon. Gentleman will address himself to the problem of what will happen postDavignon. If the Davignon proposals are not extended beyond 1980, what then will the Corporation do?
  Is the hon. Gentleman contending that, apart from the efficient competition of our French, Belgian and German neighbours, we shall be able to stand up to the competition in Third world markets by the Koreans, the Mexicans and the Japanese? The Japanese take only three man-hours to produce a tonne of steel. We are not yet in that league.
  It is not necessary to go over the history of the last 25 years to examine why investment has not taken place in the British steel industry. We all know that it has not taken place. If we are to

  849
  compete with the Koreans, the Mexicans and the Japanese, British Steel will not survive, because it is not efficient enough to do so. It is not capable of living in a post-Davignon world which does not have over it an EEC umbrella.
  I am pro-European and I would rather I did not have to make that comment. I should like to think that British Steel is the most efficient producer in the Western world and able to compete with anybody. But it is not in that position yet. I believe that the Davignon proposals have been essential to the Corporation in helping it in part to get through the present terrible recession. There is no sign of that recession ending, and it was totally unforeseen by the BSC two or three years ago.
  I realise that the Labour Party is greatly torn by our membership of the Common Market, that there are many Labour Members who would like to see us withdraw from the EEC and that—although this is not the wish of the Prime Minister or of many of his Cabinet colleagues—the Labour Party may well tight the European elections on a totally anti-EEC manifesto. I regret it, because I think that Labour Members are being purblind about the matter. But, whatever their anti-Europeanism. I believe that they should not carry it to the extent of destroying the British Steel Corporation. If they are totally anti-EEC, they will destroy employment in the steelworks in their constituencies, because the BSC now depends in some measure on our membership of the EEC and the umbrella that it provides.
  11.30 p.m.
  Dr. Jeremy Bray: The House is plainly sensitive to the proposals, and I hope that the amendment will be given due weight by the Government and will profoundly influence their attitude in Brussels.
  Perhaps we can put to our European colleagues our sensitivities on this matter by illustrating them with the sensitivities within Britain. My hon. Friend the Member for Brigg and Scunthorpe (Mr. Ellis) is fortunate in having had a vast amount of investment in his constituency. That has been pushing very hard some of the capacity that we have in mine.
  850
  I give a particular example. My hon. Friend has coming on stream in October a colliery arch bending plant with a capacity that exceeds the total output of the Lanarkshire works in my constituency and East Moors. Those are two works which can be simply closed down overnight when the new plant in Scunthorpe starts up.
  One may say "Scunthorpe must win there", but what about my lads in Ravenscraig? We have had a massive investment there. We are coming on stream with 3 million tons a year capacity and with the job of upping output by 1½ million tons, at a time when everyone else in BSC is having his output reduced. Our chaps argue "Why should we in Ravenscraig be the ones who have to take the swings in output? Why should Llanwern and Port Talbot get by with all the shifts in the week that they want, and the earnings that go with them, and we have to take the swings when we have more modern, more efficient plant than they have?"
  Into this sensitive position we have the European Community barging in. There is no concealing the problems. There is the excess capacity; there is the danger of excess investment. Consider what will happen when Greece, Spain and Portugal join the Community and massive investment goes into steelworks employing cheaper labour than in Britain. What would be our attitude to the wisdom of massively subsidised investment in Portugal? It might be said that the Portuguese would not be that silly, but I invite people to look at some of the Portuguese shipyards today.
  I think that we accept the need for a degree of co-ordination within Britain, and we should be fools if we did not accept it within Europe. Our attitude to that would be made much easier if the Community could demonstrate over wider aspects of the operation of the steel industry something of the relative success it has had on steel pricing.
  What can those areas be? The Community wishes to have powers over the financial relationship of, in our case, a public corporation to the Government. Does it want to have powers to control the borrowing limits of BSC, which are the powers that we have in this House? Or does it want to have powers that the

  851
  Department exercises in permitting drawings on those borrowing limits? Or does it want to go still further down into the internal decision-making procedures within BSC? That is what is plainly indicated by the Commission when it talks about levels of investment of individual units of 5 million European units of account.
  If the Commission is saying that it needs to have powers to go to that degree of detail of intervention, let us ask it what contribution it can make to the colliery arch problem, which my hon. Friend and I shall be arguing about very shortly, to the allocation of orders as between Llanwern, Port Talbot and Ravenscraig, and to the desperate situation that my hon. Friend the Member for Consett (Mr. Watkins) outlined.
  There are constantly new developments in the steel industry. With the massive investment in general steel-making overseas, there is the need to upgrade the capacity of our plants within Europe and within the United Kingdom in particular. The Sheffield division is perhaps particularly unfortunate with the type of investment that it has been having. What contributions can the Commission make here?
  All that we observe is that when the Corporation has made a difficult decision, when we have all known about it for months and when it has been approved by the Government, six months later along comes a press release from the Commission talking about the massive amount of money it is giving to stage 3 at Ravenscraig, or something similar, when it is simply an accounting operation, giving us back money that has been raised from us. That is not an adequate exercise of the powers that the Commission already has.
  We in Scotland, as I am sure other areas have done, have invited Commissioner Davignon to come and see the problems of the steel industry and see what we are doing about them, which is an awful lot. I do not think that we had even a reply from the Commissioners. This was despite requests to the President of the Commission to use his good offices with Commissioner Davignon to encourage him to visit us. This is simply not good enough. To leap out of that vacuum of interest and ask for total regulatory
  852
  powers overruling national Governments, having made no particular technical contribution to these wider decisions, is to get the cart before the horse.
  I hope that my hon. Friend the Under-Secretary will be able to say that he will take back to the Commission a plea from us, as Members who understand the problems of the steel industry in this country and in the world, that it should think again. It should prove its mettle and show what contribution it can make to the steel industry before asking for these overwhelming powers.
  11.36 p.m.
  Miss Joan Maynard: I support the amendment. Commission document R/1135/78 shows that our steel industry would be further eroded by the EEC, particularly as regards investment and jobs.
  On too many occasions when we discuss the EEC, we talk about the common agricultural policy. That is understandable, because probably the effects of the CAP are more obvious to the general public and all of us. However, what is going on behind the scenes in relation to our industry, particularly our manufacturing industry, and what that will mean for Britain in future are even more serious. For every £1 invested in Britain, £5 is invested in the EEC. I ask the House to consider what effect that will have on our industry in years to come. It is one of the consequences of the free flow of capital arising from our membership of the Common Market. If investment is affected in this way, so will jobs and modernisation be affected.
  Our steel industry faces a world recession. In addition, it has to withstand the effects of our membership of the EEC. Document R/1135/78 could have a major effect on the British Steel Corporation's investment plans and on the steel industry, public and private.
  I want to say a few words about the effects of imports on the special steels industry, which is, in the main, in the private sector, though there is public investment there too. The import penetration has been dramatic. Over the past 18 months about 3,000 direct jobs have been lost because of imports. These imports have come from within the EEC. I could give examples covering all the years from

  853
  1973 to 1978, but in the interests of brevity I shall confine myself to mentioning figures for 1973 and 1978 of tool steel, stainless bar and high-speed steel bar.
  In 1973, import penetration in all those categories was 12 per cent. or less. In 1978, import penetration in tool steel was 56·5 per cent., in stainless bar 80 per cent. and in high-speed steel bar 30·5 per cent. However, Opposition Members talk about the protection of the market. If that is protection, I do not understand the meaning of the word.
  The hon. Member for Flint, West (Sir A. Meyer) says that we shall not be able to sustain our steel industry. Obviously, we shall not be able to sustain it against the import penetration that I have described.
  A further effect of import penetration is a much reduced capital investment programme for the industry. Running alongside that is continued rationalisation. That is taking place under the fabricated conditions that have been created. The purpose of the Common Market is to help the multinationals. It is certainly doing that. It is doing so at the expense of our steel industry.
  A bonanza is taking place and the people of Sheffield are suffering as a result. When a delegation from Sheffield met Ministers of the Departments of Trade and Industry to draw their attention to the deterioration of its part of the steel industry, their answer was that little could be done because of the provisions of the Treaty of Rome. They said that they could not impose import controls because the United Kingdom would be taken to court.
  The Government should introduce import controls. They should let the EEC take us to court. America has placed tight controls on imports. We have suffered because imports are entering Britain that would have gone to the United States. It is not merely import penetration; in some instances it is dumping.
  One of the most positive suggestions offered to the delegation from Sheffield was for it to compile a report specifying the shape and size of the investment needed for the special steel sector. That is the investment that the delegation
  854
  thinks is needed to sustain our home market and the proportion of the international market that our industry has previously supplied. It supplies our aerospace, power generation and chemical industries along with other high technology industries. The Labour movement in Sheffield would like to see a National Enterprise Board interest in the special steel industry—in other words, a public interest in that important part of the industry.
  The compiling of the report that was asked of the delegation is proceeding with the assistance of the local authorities in the area. If the ideas and projections in the report are found to be sound and viable and capable of being acted upon, inevitably major investment will be required. The investment for reorganising and re-equipping a major part of the industry where a world lead is evident could be seriously affected by the introduction of document No. R/1135/78.
  The steel industry is controlled not merely by the Paris treaty. A major part of the industry—most of the special steel sector—comes within the Treaty of Rome. How far is the plan for steel in document No. R/1135/78 to extend? The amendment tries to safeguard the position. It asks for the minimum future investment in a vital industry and the safeguarding of jobs within the industry, which is equally important.
  11.44 p.m.
  Mr. John Ellis: My hon. Friend the Minister of State. Foreign and Commonwealth Office used certain words that sounded tough. On analysis they might not be touch. His response to an intervention put the wind up some of my hon. Friends and myself. He said "subject to our treaty obligations". I hope that it will be made clear that the tough words were tough and that there will be no qualifications. I hope that the Government will hold firmly to the amendment, which states:
  "but cannot accept proposals which would curtail assistance to and investment in the iron and steel industry and would damage employment in that industry".
  Several references were made to me before I rose to speak. I should tell the hon. Members concerned that I have no objection to co-operation with any country, be it France, Spain, America or

  855
  Japan, as long as it is on the basis of what is good for our own steel industry.
  One of the documents states:
  "The draft decision is intended to ensure that actions taken by member states individually do not impede the overall process of restructuring the Community steel industry. It would apply certain restrictions to direct and indirect Government assistance (compensation of social costs of closures, assistance for loss making plants and emergency intervention)"
  —in other words, direct intervention in all these vital areas. This is one of the most dangerous documents that we have ever considered, and we cannot accept it in any way, shape or form.
  It so happens that I have a very modern steelworks in my constituency. Reference was made to it earlier. We have always recognised that important investment decisions are involved, just as they are in any industry. Some excellent speeches have been made in this House on that subject. But it should also be remembered that the workers themselves can make an important contribution. Those of us who sit with them on committees are constantly amazed at their depth of wisdom. After all, this is their own industry.
  Government Ministers refer to all the proposals for change contained in these documents. But, instead of looking to the Common Market, I believe that they should consult in depth with the trade unions. I accept that there are features of the steel industry, be it specialist steels or a particular plant, where small is beautiful. But let the people involved in the industry have their say.
  As was done when coal was restructured, we should tell them "We will talk with you", because at the end of the day, as a result of the argument and discussion, there will be agreement. To this day, however, my right hon. Friends in the Government have never given an undertaking that instead of discussing the steel industry's problems through Community documents they will go to the workers. If they did that, I believe that we would be more likely to achieve a consensus.
  I am very keen about investment plans. Reference has been made to the terrific amount of investment that there has been. If the steel industry is to have a future, we must go on investing. But I recognise the difficulties.
  856
  It is my belief that the steel plant in Scunthorpe could produce another 1 million tonnes. But I am somewhat surprised that every time we approach the British Steel Corporation we are told "We are modernising the furnaces". However much it modernises them, we are still not making effective use of our existing steelmaking capacity. Last year, the steel plant in Scunthorpe made a loss, principally because the plant was not loaded. We must make the maximum use of that plant.
  That is not to say that we should do this immediately. I recognise that at present there is over-production. I hope that contingency plans are being made. I look to the British Steel Corporation to say that those contingency plans have been made. If it is not right that those investments should be made, that is fair enough, but it seems ludicrous, especially when many millions of pounds have been invested in a plant, not to run it efficiently and well.
  I want to make two brief points of detail. The documents refer to "rehabilitation money", or compensation for other industries. If we have already received that money, I should like to know where it has been spent. It has certainly not been spent in my area, where plants have been closed down. The way in which that money has been spent is a closed book. We want to hear where it has been employed. It is an anachronism to talk of fair competition.
  Certain Continental producers were a long way from the coking coal and it had to be dragged to their steel plants. We had to put our money into the coking coal scheme. When the agreement was entered into, no one in the House knew of it. An agreement was worked out by the back door because it had no benefits for us. We gave the EEC the money, and it gave it back because it said that it did not apply. Someone in the Common Market woke up and there was another order. It was said that it was only an unwritten agreement and that we could not have the money back. Are we still having to pay for other countries' difficulties in dragging coking coal long distances to their steel plants?
  I believe in fairness in debate. Although we on the Labour Benches may be anti-Common Market and against this

  857
  legislation, with the honourable exception of that of the hon. Member for Banbury (Mr. Marten) the speeches from the Conservative Benches came close to being anti-British. I hope that in his reply for the Opposition the hon. Member for Arundel (Mr. Marshall) will reject the proposals of the hon. Member for Flint, West (Sir A. Meyer), who sought to destroy the steel industry as we know it. He could at least have said that we in this country would recognise our obligations and bring work to the communities that would be destroyed if he had his way. In my election address, I shall consider printing his speech and pointing out that that is what the Tories would do to our livelihood in Scunthorpe and elsewhere. He made a sad, gloomy and destructive analysis of the steel industry.
  Sir Anthony Meyer: The hon. Gentleman says that he is fair in debate. It is not fair to postulate that people who ask us to face realities are anti-British. I want to preserve a British steel industry. I believe that it can only be done in the European context.
  Mr. EllisWhen the hon. Gentleman reads his speech tomorrow, he will realise that he has wrapped up the steel industry. If his analysis is put into effect, the steel industry is finished, leaving only a fringe sector. He has completely destroyed the British Steel Corporation. He has ruined many communities.
  Mr. Deputy Speaker: The debate is rapidly coming to a conclusion as far as the Back Benches are concerned. The Front Bench speakers wish to begin winding up at 12.10 a.m. This leaves 15 minutes for about three other speakers. I therefore appeal to hon. Members to make each speech last only five minutes.
  11.54 p.m.
  Mr. Peter Hardy: There are several points in the Opposition speeches which should be considered. None of my hon. Friends has referred to the fact that in the 1940s and 1960s the Conservative Party fought furiously to prevent national control of the steel industry. Today it is eager to hand it over to a supranational body over which this House has little control. That repudiation of past prejudice is important. I would rather have the Conservative Party
  858
  seeking to concern itself with Britain than adopting this new approach, particularly if it embodies the pessimism of the hon. Member for Flint, West (Sir A. Meyer). I hope that he will read his speech tomorrow. There may be serious doubts about the viability in the long term of retaining open hearth furnaces, and we closed ours in South Yorkshire in the 1960s. From my area, despite the massive competition and the serious challenge from Japan and Korea, we are exporting 30 to 40 per cent. of our production—or as much of it as the present industrial dispute allows.
  Perhaps the most serious speech from the Opposition so far was that from the hon. Member for Mid-Sussex (Mr. Renton), who spoke of the job decline in the period from 1975. In the British steel industry we have taken a longer view of the problem. For example, in South Yorkshire in the last 10 years we have shed between 8,000 and 10,000 jobs. But we have done it knowingly and in a humane way in order that we might have a steel industry which can compete with the rest of the world.
  I shall not repeat the impressive list of achievements given by my hon. Friend the Member for Sheffield, Heeley (Mr. Hooley). He spoke of our fine position in South Yorkshire. In the part of the Rotherham works in my constituency and within the Parkgate complex, we have, in addition to the Roundwood and the Aldwarke plants, the Thrybergh Bar mill, which is more successful and has broken more records than any of the plants in the countries which have so daunted Conservative Members. I do not believe that we should be daunted. At the same time, I do not believe that we should say that we should not have international co-operation. None of us would have deplored the pricing proposals which Commissioner Davignon introduced. But I do not think that we should encourage the Europeans or anyone else to believe that simply because the pricing proposals had a germ of sense we should surrender control.
  At present, we in Britain are already importing too much steel. This is not in the form of bars and billets, or rod and coil, but in the form of motor cars and other manufactured goods. If we have any optimism—which has clearly departed from the Opposition Benches—we shall

  859
  look to the day, perhaps not far off, when there will be a greater buoyancy within our economy and, therefore, a demand for the steel which we must retain.
  In any consideration of the European steel industry, we should match considerations of population with those of steel capacity. If we carry out that comparison, we can see that there would be no justification whatever for any major reduction in British Steel. Unless I have a guarantee that there will be no major reduction and that the steel workers of South Yorkshire can continue to break world records, I certainly cannot support any alternative policy.
  11.58 p.m.
  Mr. Martin Flannery: I want to protest once again that a vital debate of this nature is taking place late at night with practically no members of the press here. Therefore, many people who might have heard about these proceedings will not do so.
  When I first came to the House and saw the vast amount of EEC documentation coming forward, I was one of those who turned up on every occasion to try to struggle through it. However, we have been literally snowed under, and I notice that we are getting fewer in number. The reality is that we simply cannot read through all the documentation. It is so massive that it simply slips through. It is sad that so few people, both in this House and outside, will have even glanced at this documentation. Anybody who is fair-minded and who looks at the three documents will be appalled at what he finds in them.
  When my hon. Friend the Member for Sheffield, Heeley (Mr. Hooley) came to me the other day to seek support for his amendment, I took a rather keener interest than I had up to that time. I got the documentation to look through it. First of all, let me make it quite clear to anyone who describes us on the Labour Benches as "Little Englanders" that there is not one of us here who has not a proud record of internationalism throughout his or her entire political life. None of us is a nationalist. But the odour of pessimism that has flowed across from the Opposition Benches, with the sole exception of the hon. Member for Banbury (Mr. Marten), could not fail to make us worry about the attitude to the British
  860
  steel industry of hon. Members on those Benches who support the Market.
  I find this documentation worrying. I am also worried, like my hon. Friend the Member for Brigg and Scunthorpe (Mr. Ellis), by the ambivalent attitude of the Minister of State, who in one powerful sentence expressed more or less total opposition but then produced a form of words which appeared to contain a major retraction. The Minister mentioned one other nation with a similar attitude to ours. I hope that it is stronger than the ambivalence displayed by my hon. Friend.
  I regard this documentation as an unacceptable interference in our steel industry. If these documents were put before the steel workers—my hon. Friend the Member for Sheffield, Brightside (Miss Maynard) has already shown them to some of our people in Sheffield—they would be appalled. The interference in BSC investment is an example. We are putting vast amounts of money into BSC precisely because private investment in the steel industry was so pitiful. That is the reality. The Thrybergh mill, as soon as it was given the production resources, achieved a world record. That shows the pride that exists in our industry and its potential.
  I hope that hon. Members on the Conservative Benches who are opposed to the Market will not object if I state that a complete lack of Socialist approach permeates these documents. We are biased in favour of putting more money into a nationalised industry, to strengthen it and make it more powerful. The contradiction in the Conservative approach was underlined by my hon. Friend the Member for Rother Valley (Mr. Hardy), who pointed out that Conservative Members were totally against nationalisation but, in the same breath, wanted internationalisation almost overnight. We are asked in these documents not to discriminate between private and publicly owned industry. I personally would discriminate because I am in favour of publicly owned industry. I see this documentation as hindering Socialism and a Socialist policy. That might appear sectarian, but we sit on these Benches because we hold different opinions from those of hon. Gentlemen on the Conservative Benches.
  The documents state that restructuring plans for steel in the EEC must not be

  861
  impeded by national plans. We are restructuring and hoping to put more money into our industry. We are convinced that the industry can flourish. We are convinced that without resorting to Little Englandism we can build a stronger industry. What would happen if we wanted to devote a large part of North Sea oil income to regenerating the steel industry and the EEC objected? We know that entrepreneurs all over South Yorkshire are building up stocks of special steels. We do not want interference. If we do not take action, our industry will be steadily run down by the EEC.
  I find these documents intrusive and worrying. I would like a far more definite statement from my hon. Friend the Minister on his opposition to the documents.
  12.5 a.m.
  Mr. David Lambie: I intervene as a Scottish Member with a steel interest. But in that respect I am holding on with the skin of my teeth. All the steelmaking activities ended two days before Christmas in an area where there is already a 13 per cent. unemployment rate. Unless we can find an alternative industry, that unemployment rate will reach 35 per cent.
  What has the EEC done so far for the steel workers in my area except to bribe them to sell their birthrights and their jobs? If the EEC gets away with tonight's regulations, with the support of the Government, there will be no future for the steel workers in my constituency and in the rest of the United Kingdom.
  I support the amendment. I hope that the Under-Secretary of State will be more firm than the Minister of State. We might be within three to five weeks of a general election. We want to campaign in the steel constituencies on the basis that a Labour Government will veto any attempt by the European Commission to take control of the investment plans of the BSC and the future of the steel industry in the United Kingdom.
  Only rolling mills are now operating in my constituency, but we still have tremendous potential. We are only seven miles from the Hunterston steel peninsula,
  862
  where the BSC has invested about £145 million in the iron ore terminal and two direct reduction plants. But the intention is to mothball those plants when they are completed in June this year.
  The Government and the BSC have said that the next steel development on a green field site will be at Hunterston. I want the decision on that development to be under the control of a British Labour Government. It must not be handed over to the bureaucrats in Brussels. We found it difficult enough to get that commitment from a British Labour Government. We have not a hope in hell of achieving such a commitment from the European Community.
  The future of the steel industry in North Ayrshire depends on a British Labour Government and the British Steel Corporation. That is why I support the amendment. That is why I hope that the Government will make a commitment to the steel constituencies, if we are to face a general election in the next few weeks.
  12.8 a.m.
  Mr. Michael Marshall: On one matter at least I can agree with the hon. Member for Sheffield, Hillsborough (Mr. Flannery). Many of us regret that this debate is being conducted so late at night and in such a short time. I regret that in less than 20 minutes I have to try to reply to about 14 speeches and to put questions to the Minister.
  The Minister fluttered briefly round the course. He used his well known "avoid the minefield" technique. The pro- and anti-European divisions exist within both parties. When the Minister reads Hansard he will find that even with his moderate and light-hand-on-the-tiller approach there was a storm of flak behind him.
  It is not my task to try to give satisfactory answers on behalf of the pro-Europe case, but I should like to touch on a number of speeches which have been made tonight because one of the problems I face is trying to distinguish between those with genuine concern and the alarmist; between those who try to turn this into something party political across the Floor of the House and those who believe that it raises deep issues. We can fully understand hon. Members' views, both pro- and anti-Market.

  863
  It is clear that if one takes the broad view across the House one has to accept some kind of majority view. I start by making the assumption that in looking at these four documents we are concerned with matters which go to the very heart of the future of the British steel industry. My assumption is that membership of the European Coal and Steel Community, as with membership of the Community itself, is a fact of life and will continue.
  One hon. Member—I believe it was the hon. Member for Brigg and Scunthorpe (Mr. Ellis)—suggested that we should consult more fully with the trade unions in trying to get a clear view about the Community. I draw his attention to the latest, December, issue of the Iron and Steel Trades Confederation magazine in which the ISTC's parliamentary panel member, the candidate seeking election to the European Parliament, Mr. Paul Flynn, was asked his views about this question and what should be done about investment. He said:
  "For 30 years large scale decisions in our industry have been made on the European scale. The recent shock scrapping of the £200 million oxygen plant at Neuves-Maison"—
  the French oxygen plant—
  "sent a shudder through the whole European steel industry. It was the nightmare possibility we thought could never happen. These are perilous times and it would be of enormous value to have a voice speaking for I.S.T.C. in the European arena"
  I agree with that. If one thing has been made abundantly clear—
  Mr. John Ellis rose—
  Mr. Marshall: I have got so much to say that I am afraid I cannot give way.
  Mr. Ellis: The hon. Member referred to me.
  Mr. Marshall: I am sorry. I shall have the same problem, with a number of hon. Members to whom, in courtesy to them, I should like to refer, but I must get on.
  The important point I am making is that tonight the case has been made clearly for directly elected European Members. Many of the problems which have been raised tonight and many of the worries expressed will clearly become, after June, the concern of those colleagues who then become directly elected Members of the European Parliament.
  864
  They are some of the people who, I trust, will go to fight for their corners and for their regions, as hon. Members have done tonight. I do not think we can adopt a static view of draft documents of the kind we have been concerned with tonight.
  Therefore, my second assumption in looking at the future of these matters is that an integral part of our membership of the ECSC is a continuing commitment by this country and by other members to try to overcome the structural and human problems of overcapacity and overmanning and, as the explanatory memorandum in document R/1135 says on Community rules for aids and interventions, to tackle European uncompetitiveness arising from old or badly sited plant and modern working at less than optimum capacity. It follows, therefore, that we must consider active support for the restructuring plans upon which the Commission is currently working.
  I should like at this point to put the point directly to the Minister. I hope he will be able to tell us when the Government expect those restructuring plans to come forward. It is a valid criticism of some of the rules which we have before us in draft form that if they are being put forward prior to the restructuring plan and if that restructuring is reasonably on its way there is not too much point to them. I suspect that this is a longer-term and vast problem but, nevertheless, it would be helpful to consider that aspect.
  The third assumption—and I think that this brings us back to the short term—is the question of price restraint and tonnage restraint and the way in which the Davignon plan has operated. I believe it is common ground for the majority of hon. Members that Davignon has been of assistance. It is certainly the view of the British Steel Corporation and it is certainly the view of the British Independent Steel Producers Association. The chairman of the British Steel Corporation, talking to the Select Committee on nationalised industries in December, and as was reported in the press, said that if we did not have the Davignon plan it would have been necessary to invent another.
  My hon. Friend the Member for Mid-Sussex (Mr. Renton) has put forward a consistent view—and I should like to pay

  865
  tribute to the work he has done in the Select Committee on Secondary Legislation. It is because of that scrutiny that we are having this debate.
  All hon. Members who take an interest in these matters must accept that in recent years we have seen great difficulties in the steel industry, and it is outrageous for hon. Members to attack my hon. Friend the Member for Flint, West (Sir A. Meyer), who was pointing to the real problems faced in steel making. No one can get any pleasure out of that. Anyone who glances at the BSC figures for the past five years will see that the tonnage has gone down from 18·1 million tons in 1973–74 to complete stagnation in the past three years at between 12·7 million tons and 13·4 million tons. Hon. Members must accept that we face a dilemma because the BSC is saying that these are now normal times. It cannot see a speedy end to the recession.
  The hon. Member for Rother Valley (Mr. Hardy) was right to express one optimistic aspect. If we can get industry competitive—and, indeed, if we can get the whole of British industry competitive—there is, on the current sales of 50 per cent. of the British market, a target to shoot for. But even if we take the maximum amount of steel capacity—26 million tons at present—we must remember that the BSC already has the problem of overcapacity in relation to any possible sale.
  There was a realistic element in the speech of the hon. Member for Motherwell and Wishaw (Dr. Bray) when he suggested that we had to think about the possibility of problems from subsidised Portuguese or Spanish industries. My hon. Friend the Member for Mid-Sussex was also right to strike a realistic note on how we must face up to these challenges. They will have to be faced by the present Government and, I trust, by the next Conservative Government.
  The House has had to consider a number of important issues which go well beyond sheer technicalities. Let me look in more detail at each document. All hon. Members have felt most concerned about the rules. I spoke earlier about the commitment to Davignon. One side of that coin is price agreement and the attempt to achieve market restraint for a
  866
  temporary period. We must look at it as a temporary arrangement. Price agreements are like incomes policies: they cannot be better than temporary. There comes a time when the mechanism will wear out.
  Time is desperately short and I hope that we have enough time to move into areas of agreement on structural capacity and getting a balanced steel industry in Europe. I remind hon. Members that in looking at the balance sheet it is important to bear in mind the commitments that we already have to the Commission. To put it crudely, we must take into account what benefits we are getting from our membership of the Community.
  We pay levies of between £7 million and £8 million a year. Against those, we must offset our annual returns. In the past 12 months, we have had £1·8 million for readaptation grants for those affected by rundowns and closures, and another £500,000 for cheap-loan housing for those who have to move as a result of that sort of plant closure. This year alone, 2,400 workers at Hartlepool, Shotton and East Moors will get the advantage of that sort of support. We must add to those sums £750,000 for research grants, £250,000 in low-interest subsidy for investment with an anti-pollution element, loan interest on £412 million of direct ECSC loans and £216 million from the European Investment Bank. The ECSC already has a direct and vital stake in our steel industry with a net balance in our favour.
  One hon. Member suggested that we might be in some way moving into very dangerous waters in shifting over to the customs duty proposal. That is a matter for argument. I am perfectly willing to consider what is the best way to raise the levy. That we have to raise the levy seems to me inescapable for the reasons I have given.
  When we look at the figures with which the Government have provided us, we can see that if we changed over to the customs duty arrangement it would cost us, on current estimates, between £11 million and £12 million per annum, as against the existing figures of between £8 million and £9 million per annum. Frankly, in relation to a turnover of £3,000 million per annum, we are talking of a relative drop in the ocean in this

  867
  respect. The right hon. Member for Battersea, North (Mr. Jay) may well want to argue the principle, but I do not think that the amounts are significant in the terms that we are discussing tonight.
  I now turn to the broader question of the basis upon which the rules ought to apply. That we should have rules cannot be escaped. It is the obverse side of the coin, as I have said, of the Davignon proposals. For the British Steel Corporation, it has meant directly a strengthening in demand for some products, as stated in the annual report, and when we saw the chairman of the British Steel Corporation he made it clear that, if it had not been for the Davignon proposals, it would have been impossible for the British Steel Corporation to move back up four percentage points in its flat steel products during the last 12 months, at a time when it was desperately trying to edge back over 50 per cent. of the market.
  These are the kinds of arguments which have persuaded BSC that the Davignon proposals are in its best interest. For the British Independent Steel Producers Association, similar arguments apply. The hon. Member for Sheffield, Brightside (Miss Maynard), as far as I could see, was simply making a case for a better Davignon plea. She will appreciate that within the practical constraints of today it has only been by the attempts to make sure that some restraint is exercised that the market for special steels has not been even worse.
  But there is a wider interest also for the independent producers. Transparent and open competition is crucial to a private sector which has always said that it wants to be in fair and equal competition with a massive State steel industry, of which it is, incidentally, a major customer. Those are the assurances that were given to that sector at the time of nationalisation.
  I do not claim that the Davignon proposals are perfect. I would not be here tonight arguing that the proposals in the documents before us contain some perfect formula. But one would like to know from the Minister rather more about the Government's precise attitude on these negotiations. We had a very broad-brush approach from the Minister of State. He simply said that the Government had not felt able to do these things for certain
  868
  reasons. We understand his broad reasoning, but we need to know, for example, on the question of regional aid, whether this is a matter which will be discussed in detail. To what extent would agreed lists be a feature of the initial agreement if an agreement were to be reached?
  It is interesting to note how the documents presented to us single out Scotland, Wales and so on. The whole burden of the case of the Commission, if it were here to answer for itself, would surely be to point to the fact that this country and Italy, as presently constituted within the steel family, are likely to benefit from the Community more than other parts of the European steel industry, because that is the nature of the problem. Therefore, this must be something that we want to hear about from the Minister. We want to hear precisely what understanding exists. The Minister mentioned that there had been an agreement on shipbuilding. We were led by the press to understand that a similar kind of compromise agreement was to he reached on steel.
  It is clear that the British Government and Italy have argued for a breathing space. We have until April to look at the matter again. The Government, while they remain in office, have a continuing responsibility in these matters. We want to hear from the Minister precisely what they intend to do as they go into further rounds of negotiations, armed with the benefit of the advice they have had from all sides.
  In broad terms, we simply cannot consider scrapping the Davignon proposals in the present situation. It has to be accepted that in terms of the proposals we are obliged to continue with some form of negotiation as to rules. If we do not, we are simply saying, in effect, that we can destroy the Davignon proposals, or any other price agreement, by allowing subsidy at the other end of the scale. The hon. Member for Motherwell and Wishaw demonstrated that very well indeed.
  In the amendment, certainly on paper, I find it difficult to see anything objectionable. The hon. Member for Sheffield, Heeley (Mr. Hooley) is, in effect, inviting us to join in invocation to reject sin. My difficulty is in seeing where he has been able to find any real reference within these documents which could bring about the undesirable matter that he has mentioned.

  869
  The nub of the matter is to be found in the Council resolution, in paragraph 2 and the following rules 1 to 6. In this House all of us must try occasionally to strip aside our prejudices—in this case, whether we are pro-Market or anti-Market. But, frankly, I could not help thinking, as will some other hon. Members who have read the rules, that when one reads out the rules one's tone of voice can almost make or break one's fears or happiness about the subject. Let us take:
  "Aid, in whatever form, must promote restructuring and conversion and take account of the resultant social consequences and effects on employment".
  Who could object to that? Let us take:
  "Competition must not be distorted by the aid."
  Who could object to that? One could continue down the list.
  Mr. Hooley: Will the hon. Gentleman give way.
  Mr. Marshall: No, I am very sorry. I have only four minutes.
  The whole point is that it is very difficult to judge, without rehearsing some of our prejudices, precisely what is meant by some of these points as drafted. Surely the Government, who have had experience of negotiation, ought to be able to put some flesh and blood on the skeleton of these matters.
  I sum up our attitude to these matters. The Opposition accept that, while Davignon is a continuing feature of international steel trading, there must be some measure of price restraint. Therefore, we understand the points put forward about steel merchants. As I understand it, there have simply been some opportunities for evasion, particularly on the matter of sale of cut-up coil, and so on.
  We agree that the ECSC must continue to be funded. As I have said, the actual basis is a matter for argument. I have also said that I think that the present differential between one system and another in money terms appears to be relatively minor.
  Our concern remains the Government's attitude to the Commission's proposals for aid to the steel industry. I share some of the reservations that have been expressed tonight, because looking at these matters cold is very difficult. In
  870
  this situation we would have benefited from the advice of many of our colleagues who are Members of the European Parliament, who, for all kinds of reasons, as many of us know, cannot be with us tonight but who would make the case for the Euro-Members of the future.
  However, in the proposals which I have read out, I cannot see anything like the anxiety which has been expressed by many hon. Members. It would be very hard indeed for us to explain to other members of the EEC if we simply say "We are trying to go this alone". As I think the Minister of State said, on the present estimate, 34 per cent. of all expenditure coming from the Community for steel is coming to this country. That really makes us the principal beneficiary. That has been our position over many years. That situation may well continue.
  I think that the Government are moving towards accepting the amendment; I give the hon. Member for Heeley that guesswork in advance. I think that the Government are simply trying to keep him and his hon. Friends, particularly those below the Gangway, in a cheerful mood. The suggestion that there is some kind of party-political mileage and that this is in some way a matter on which, for electoral popularity, the Government are taking a tough anti-European line is all eyewash. Frankly, I think that hon. Members have realised that. They did so when they suggest that the Minister of State ought to have given them a bit more precise detail. I shall invite the Under-Secretary to do so shortly.
  I simply say that the Government, in this matter as in so many others, are walking on a tightrope. They are trying to maintain EEC and ECSC membership, they want to have the benefits of Davignon, but they would like to avoid crunch questions—of which these are crunch questions. In this as in so many other matters, it will take a fresh look and a fresh Government from the Conservative Benches to bring us to reality.
  12.30 a.m.
  The Under-Secretary of State for Industry (Mr. Les Huckfield): I am afraid that I shall not bring any joy at all to the hon. Member for Arundel (Mr. Marshall) in the last respect that he mentioned. Indeed, the ambivalence that he

  871
  expressed on behalf of the Conservative Party contrasted markedly with the firm determination expressed by my hon. Friends. The change of tune on the Opposition Benches, depending on where hon. Gentlemen sit tonight, was in marked contrast to the determination of my hon. Friends to preserve our steel industry, above all, to represent their constituents adequately and to keep the interests of the British Steel Corporation in their minds.
  Tonight we had some good sense from the hon. Member for Banbury (Mr. Marten). I take on board the point that he made about the absence of any reference to the Scrutiny Committee documents. I shall certainly see that that is fed through to my right hon. Friend the Lord President.
  The hon. Gentleman's good sense contrasted with what I thought was the incredible nonsense that we had from the hon. Member for Flint, West (Sir A. Meyer). I hope that his Labour opponent will make his constituents absolutely aware of his sentiments tonight. The hon. Gentleman's proposals to hand over the future of the steelworks and of steel workers in this country to the European Commission will not go down well in his constituency.
  We had testimony to the achievements of the British Steel Corporation by my hon. Friend the Member for Penistone (Mr. McKay) in the £21 million investment at Stocksbridge. We had the anxiety expressed by my hon. Friend the Member for Consett (Mr. Watkins), and I look forward to receiving the deputation from Derwentside that he is to bring to me. My hon. Friend the Member for Motherwell and Wishaw (Dr. Bray) expressed the strong feeling that the Commission must prove itself. We then had a robust defence of the BSC's achievements by my hon. Friends the Members for Brigg and Scunthorpe (Mr. Ellis) and Rother Valley (Mr. Hardy).
  I know that my hon. Friends the Members for Sheffield, Heeley (Mr. Hooley), Sheffield, Brightside (Miss Maynard) and Sheffield, Hillsborough (Mr. Flannery), from the way that they have pressed the interests of their constituents over the past weeks and months, are determined to do something to secure a better future for Sheffield steel.
  872
  My hon. Friend the Member for Brigg and Scunthorpe asked a specific question about rehabilitation expenditure from the European Coal and Steel Community. Those benefits have gone to workers who were previously employed at, for example, Hartlepool, East Moors, Ebbw Vale and Clyde Iron, and not into the BSC's pocket. The money comes jointly from Community funds and from Her Majesty's Government. If my hon. Friend would like further information, I can give it to him on some other occasion.
  The hon. Member for Arundel, if he was ambivalent in some of his remarks, was quite right to pay tribute and testimony to the efficacy of the Davignon anti-crisis measures. I do not want to detract from that. I pay tribute to the fact that, because of Davignon, producers have been obliged to refrain from continued alterations in prices—price cutting—by the imposition of mandatory minimum and guidance prices and that importers have been prevented from buying steel at low rates from third countries for sale within the EEC.
  The BSC recognises the benefits that it has gained from the Davignon anti-crisis measures. Indeed, we recognise that the anti-crisis measures have helped and that it is sensible for Community steel industries to look for some kind of joint solutions to their problems. But, at the same time, we must speak for and defend the best interests of our steel industry and workers.
  The hon. Member for Arundel paid a glowing tribute to the money, in the form of a balance sheet, that we were supposed to be receiving from the ECSC. However, the figures for the last year do not accord with what he said. They show that BSC paid in about £6½ million and got back £2 million. The figures over different years probably balance out a little better than that, but the figures for last year do not justify the kind of eulogy given to the House by the hon. Gentleman.
  Mr. Michael Marshall: Will the Minister accept that I obtained the figures I quoted from the BSC as the latest figures? I think it is useful for the House to examine them so that perhaps by tabling written questions we can help to clarify the matter.
  Mr. Huckfield: I hope that the hon. Gentleman will be fair in giving the House last year's figures. Those figures show that we paid £6·5 million and got back £2 million.
  The hon. Gentleman asked about the extension of the Commission's powers over United Kingdom regional aids. We have made clear to the Commission that we attach considerable importance to our freedom to offer regional assistance and that we shall resist any attempts to curtail this freedom. The Commission is well aware of the difficult situation that we would face if a decision on the extension of its powers over regional aids were made. I hope that will markedly contrast with the ambivalent attitude displayed on the Conservative Benches in this debate.
  The proposed steel aids decision, as my hon. Friend said in opening the debate, would have the effect of altering the balance of powers between the Community institutions, and we believe that it would set a major precedent in conferring new powers on the Commission. I appreciate that that is what the hon. Member for Flint, West wants. Equally, the proposal permanently to transfer customs revenues on steel products to Community funds—this relates to document No. R/1292/78—would represent a significant change in the workings of the ECSC. Solutions to crises must be found, but we do not believe that any such crises should be used as an excuse for permanent changes.
  Many of my hon. Friends have made plain tonight that in regard to document R/1135/78 the Commission's draft proposals on State aids are too rigid for us. We cannot be bound to follow policies designed to put the steel industry back on its feet without paying due regard to the social and economic consequences of such action on the country as a whole. The Commission and other member States cannot expect us to bind ourselves to agree to proposals which would, in effect, deprive us of the power to decide upon the speed and content of our restructuring programme. We have said that it is up to BSC to negotiate closures at its discretion and that no action will be taken without prior consultation with the trade unions and the work forces concerned.
  874
  Paragraph 14 of the White Paper "British Steel Corporation: the Road to Viability" reads:
  "No action will be taken without prior consultation with the TUC Steel Committee and the local workforces."
  We intend to stand by those words.
  Mr. John Ellis: Will my hon. Friend take the workers into his confidence, as was done in the coal industry? In that case there was not just consultation but, although it was a stony road, eventual agreement. Will the Government seek not just negotiations but agreement?
  Mr. Huckfield: I take my hon. Friend's words to heart. With my right hon. Friend this afternoon I met a deputation from Bilston. The representatives expressed a strong case. My right hon. Friend believes that they must be consulted. Indeed, it has been our policy that the trade unions must be consulted.
  We have made our stand on this matter and are on record as so doing. I accept the spirit of the amendment, and because I accept the spirit of their amendment I hope that my hon. Friends will not feel bound to press it.
  Mr. Jay: My hon. Friend has said that the Government would resist the proposals and that they cannot accept them. Can he assure us that that means that they will not accept the proposals in their present form?
  Mr. Huckfield: In view of the statements that my right hon. and hon. Friends and I have made, I am surprised that my right hon. Friend should even question me in that way. I have made the position very clear tonight, as has my hon. Friend the Minister of State, Foreign and Commonwealth Office.
  Mr. Marten rose—
  Mr. Huckfield: I have only a short time, and I did make a rather glowing reference to the hon. Gentleman, which I genuinely meant.
  Our policy has been set out in our White Paper "The Road to Viability". We explained our intention with regard to the corporation's future finance, and set out the action we are taking to put the corporation back on its feet. We made plain our intention to achieve an

  875
  efficient, competitive and profitable steel industry in the 1980s.
  My hon. Friends from Sheffield have made a special case for their area. I hope that my hon. Friend the Member for Heeley will take cognisance of the comprehensive answer I gave him yesterday, stating the Government's overall position on special steels. I also hope that he will carefully read the import figures which I gave him in a different answer yesterday. My statement, in reply to a series of questions, and those import figures show the improvement that is taking place in certain sectors of the special steel market. The figures show that the improvement is being maintained.
  I refer particularly to the part of the Adjournment debate on 28 November when I told my hon. Friend:
  "Of course, taking the broad areas, I am sure I my hon. Friend will recognise that so far, as a result of some of these activities"—
  I was referring to the activities that the Government had already undertaken—
  "alloy tool, die and magnet steel import penetration has fallen from 73·01 per cent. in 1977 to 71·34 per cent. so far this year. Stainless steel bar penetration has fallen from 44·78 per cent to 41·25 per cent."—[Official Report, 28 November 1978; Vol. 959, c. 405.]
  Those are just a few figures dealing with a few special areas that I know have been of great concern to my hon. Friend. I hope that he will note that there has been that improvement. It must continue, and I think that the figures I gave him yesterday show that it is continuing.
  Mr. Marten: I am grateful to the Minister for now giving way. He said that he accepted the spirit of the amendment. What I should like to know is whether he accepts the amendment.
  Mr. Huckfield: If I had been asked personally, I would not have put the amendment quite in those words. What I am saying is that I accept my hon. Friends' vigorous defence of their constituents' interests tonight. Because I accept that, I accept the spirit of the amendment.
  Mr. Marten: Does the hon. Gentleman accept the amendment?
  Mr. Huckfield: If I am pressed I shall tell hon. Members that if I had been in their shoes I would not have put the
  876
  amendment quite in the same words. Nevertheless, I accept its spirit.
  We have in the past, although not too much tonight, had some criticism of the degree to which the Scrutiny Committee was kept informed of progress towards the adoption of the 1978 budget proposals contained in document R/674/78. The Committee considered the original draft decision on 7 December 1977, which paved the way for this, before the Council approved an allocation 32 million EUA in principle. It did not at that stage recommend a debate. The Committee also considered on 18 May 1978 a revised draft of R/674/78, providing for contributions to be made in proportion.
  I hope that the hon. Members who speak as members of the Committee will read carefully the explanatory memorandums that have been sent to them, as well as the correspondence between the Chairman of the Committee and my right hon. Friends. That sets out the difficulty in which my right hon. Friends found themselves in wanting to get the measures operable as soon as possible, as was essential. Perhaps the fully detailed consultation at the appropriate time which the Scrutiny Committee might have sought was not then possible because of the speed at which a decision had to be taken. Nevertheless, I hope that hon. Members will accept the explanation which has been given and that the sentiments expressed in my hon. Friends' letters have convinced them that we take their representations seriously.
  It is difficult nationally to establish a precise balance sheet. Although it is true that the British Steel Corporation and the steel industry have benefited to some extent from the Davignon anti-crisis measures, I recognise the strong feelings of my hon. Friends who have spoken on behalf of Sheffield special steel. As my hon. Friend the Member for Penistone said, on the matter of Sheffield special steel we have been in correspondence with Commissioner Davignon and we have sent his latest reply to the sector working party and to BISPA for consultation. We want to make progress. We think that the spirit in which the Commissioner has replied sets the framework in which we hope to be able to make progress.
  However, the Government believe that any plan to restore a disciplined market

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  in steel and to provide financial assistance and alternative employment to redundant workers must benefit Britain. Under the ECSC budget, we believe that we are not being asked to provide funds disproportionate to our receipts.

  Division No. 52]

  AYES

  [12.47 a.m.

  Bagier, Gordon A. T.

  Hamilton, James (Bothwell)

  Marten, Neil

  Bain, Mrs Margaret

  Hardy, Peter

  Maynard, Miss Joan

  Bishop, Rt Hon Edward

  Harrison, Rt Hon Walter

  Moate, Roger

  Boothroyd, Miss Betty

  Home Robertson, John

  Smith, Rt Hon John (N Lanarkshire)

  Bray, Dr Jeremy

  Hooley, Frank

  Snape, Peter

  Cocks, Rt Hon Michael (Bristol S)

  Huckfield, Les

  Urwin, T. W.

  Concannon, Rt Hon John

  Hunter, Adam

  Watkins, David

  Cook, Robin F. (Edin C)

  Jay, Rt Hon Douglas

  Whitehead, Phillip

  Cowans, Harry

  Judd, Frank

  Wise, Mrs Audrey

  Cryer, Bob

  Lamble, David

  Ellis, John (Brigg & Scun)

  Loyden, Eddie

  TELLERS FOR THE AYES:

  Evans, John (Newton)

  Lyons, Edward (Bradford W)

  Mr. Alf Bates and

  Flannery, Martin

  McNamara, Kevin

  Mr. Jim Marshall.

  NOES

  Fairbairn, Nicholas

  Penhaligon, David

  Johnston, Russell (Inverness)

  Lester, Jim (Beeston)

  TELLERS FOR THE NOES:

  Meyer, Sir Anthony

  Mr. Tim Renton and

  Mr. Robert Rhodes James.

  Question accordingly agreed to.
  Main Question, as amended, put and agreed to.
  Resolved,
  That this House takes note of the EEC Document Nos, R/1135/78, R/1221/78, R/1292/78 and R/3454/78 on the Steel Industry but cannot accept proposals which would curtail assistance to and investment in the iron and steel industry and would damage employment in that industry.
  Mr. Michael Marshall: On a point of order, Mr. Deputy Speaker. The House is in a little confusion as a result of the vote. We had the somewhat peculiar situation of the Under-Secretary of State saying that he accepted the amendment but advised that it should be withdrawn. We are not quite clear whether the Government feel that they have carried out their undertakings to the House. Perhaps it would help if the Under-Secretary explained his advice a little further.
  Mr. Les Huckfield: It is very simple. As I have consistently said to Opposition Members and to my hon. Friends, had I been given the choice I would not have used those words. That is all that I say. But, having said that and having voted for it, I hope that the Government's position is now clear.
  Several Hon Members rose—
  I hope that my hon. Friends, recognising that I have accepted the spirit of their amendment, will not press the amendment and that it will be withdrawn.
  Question put, That the amendment be made:—
  The House divided: Ayes 35, Noes 5.
  Mr. Deputy Speaker (Mr. Oscar Murton): Order. The general rule is that in these circumstances an intervention from each side is allowed. But I shall not allow any more.

  HIGH COURT ATTENDANCES (OFFICERS OF THE HOUSE)
  Ordered,
  That leave be given for the proper Officers of the House to attend the hearing of an appeal by Maurice Donald Henn and John Frederick Ernest Darby against their convictions and to produce the Report of the Debate to which reference is desired to be made and formally to prove the same according to their competence, as prayed for in the Petition relating to the said appeal presented to this House yesterday, and that leave be given for reference to be made to the said Report.—[Mr. Arthur Davidson.]

  FLOODING (FAVERSHAM)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. John Evans.]
  1.1 a.m.
  Mr. Roger Moate: I am most grateful, Mr. Deputy Speaker, for the opportunity of raising tonight a matter of the utmost gravity for the people of my constituency. However serious may be the other crises gripping the nation, for the people of Sheerness

  879
  in particular, but also for others in the Isle of Sheppey, the greatest threat to them is the continuing threat to their homes and, indeed, to their lives posed by the ever-present danger of renewed flooding by the sea.
  Over 30 and 31 December last about 800 houses and 40 businesses, mainly in Sheerness and in the Sheerness, Warden and Leysdown areas, were flooded. The first flooding of the town of Sheerness resulted from the high tide at 1 a.m. on 31 December. It was overtaken in its severity by a second flooding from the high tide at 1.33 p.m. On 1 January the water again reached the top of the sea wall, a situation that repeated itself for the next two tides. The warning sirens sounded again on 4 January. I hope that the Minister and the House will begin to understand what it is for a town to live in fear, knowing that the only defence against the North Sea is a Victorian sea wall some 6 ft lower than it should be.
  The damage was bad enough, but thank God that no lives were lost. But the tragedy was crueller. People had only just finished restoring their homes from the ravages of similar floods in January 1978, although the experts tell us that these floods should be at least 50 years apart.
  It is hard to describe the misery and mess caused by the flooding and the heartbreak of a home in ruins, particularly for elderly people. May I quote a letter that I have received from the Bishop of Maidstone, who has a particular concern with Sheerness, having been vicar there. It emphasises the point about the elderly. The letter says:
  "I felt desperately sorry for those who had only just completed the work of drying out and redecorating their houses, and now have to begin all over again. Many of them were elderly, and the roads affected house many in low income groups who are unable to move to a safer place."
  I could quote many letters that I have received stressing the suffering, loss, hardship and heartbreak that there has been.
  May I also record here in Parliament a tribute to the sterling work done by so many in this emergency: by the council officers and their staff, by the emergency services, by the WRVS, the Round Table, the Salvation Army, and many organisations without which the suffering would have been so much greater.
  880
  I also remind the House that at that time Britain was snowbound and suffering from severe blizzards. The roads were blocked. Sheppey was cut off for 36 hours. Warden Bay and Leysdown were cut off for 48 hours. In those two latter areas flooding also occurred and there was great personal suffering, despite the sea defences that have been constructed.
  It has been suggested there that the answer is improved land drainage to divert flood water. If the water authority puts forward a request for funds for this project, I hope that the Government will respond sympathetically.
  I have emphasised the damage factor so far. I have hesitated in the past to be too alarmist and publicise my real fears about the threat to life in Sheerness, but the latest floods have swept away my inhibitions on that score. Hundreds of lives would be at risk if we were unfortunate enough to get a combination of freak weather conditions in the North Sea, and the risk would be even greater if the flood warning system failed to work effectively, as it did on the night of 30–31 December.
  The one and only thing that will satisfy the island and cannot be refused in all humanity is the fastest possible construction of a sea wall. The population of Sheppey is 34,000 and that of Sheerness is 13,000. I believe that there is no other town of comparable size in Britain which is exposed to such danger of flooding as Sheerness. Many homes are actually below the high water level.
  I urge the Minister to get that sea wall built. I know that he cannot work miracles, or even give instant answers, but I believe that we are close to getting results, and his understanding and sympathy will help us greatly.
  The position in a nutshell is that the sea defences to provide the 1,000-year flood barrier around Sheerness, from Neptune Terrace to Queenborough, will cost about £8 million. Last year the Southern water authority placed these works at the top of its priority list and declared its intention of carrying out the programme at the rate of £1 million over eight years. Personally, I regarded that as unacceptable. Once the risk to human life on this scale has been recognised and is declared to exist, it cannot be tolerable to leave it that long. Only this month the

  881
  Government have approved the necessary grant aid for that £1 million a year programme which I have described as inadequate.
  In a series of letters, telephone calls, and meetings with the Southern water authority last year I pressed it to ask the Government for the necessary funds to carry out the works in the minimum time possible—three to five years. In December I met members of the SWA here at the Commons, and as a result I felt that we had made real progress. The idea of asking the Ministry for an extra £1 million a year for Sheerness, bringing the total to £2 million a year, was put to the committee. I was told that the proposal would be considered in depth at the February meeting.
  Alas, the cruel sea does not wait on committees, and the flooding that we feared occurred over the new year. Until the Southern water authority actually asks the Government for the funds, there is little the Minister can do. But can he confirm that when the authority does so ask, if it does, he will do his utmost to grant the request? Crucial to this is a letter I received yesterday giving the most helpful and hopeful news yet to the people of Sheppey—but only if the Government grant the money.
  This news is that the first essential works—works that would have prevented these latest floods—from Neptune Terrace to Garrison Point, a distance of 1½ miles—could be started in midsummer this year and be completed by March 1980. The February meeting of the Kent local land drainage committee will have a recommendation before it to ask the Government for the extra funds. An initial meeting has already been held between the Minister and the chairman, and I understand the Ministry was "not unsympathetic".
  In the meantime, temporary protections are being proposed by the council. But the people of Sheerness and the commercial life of that town need the protection of an adequate sea wall. The Swale borough council has asked the Minister of Agriculture to receive a deputation on this question. I hope that the Minister of State will be able to tell me that the Minister will grant the request or at least consider it very sympathetically.
  882
  This would be deeply appreciated by those living in the Swale borough council area.
  A parliamentary answer I received informed me that no advance warning was given on 30–31 December 1978, because the tide warning service indicated that there was no danger of flooding. But there was flooding. It was caused by a combination of tide and exceptionally high winds or, in the words of the Southern water authority,
  "unusual weather phenomena caused wave actions which could not at the time be forecast by the Meteorological Office."
  In fact, the flood warning that night was issued eventually by the water authority under pressure from the police when the water was already pouring over the sea wall and was outside the police station. I emphasise most strongly that the council, in all its emergency plans, is utterly dependent on the warning system, which has been developed to a fairly sophisticated degree, working effectively. A way must be found to forecast, accurately and locally, wind and wave actions. I understand that this is being studied. In the meantime, it is reassuring to know that Swale has arranged its own ad hoc system of putting an official into the Medway port operations room whenever an A warning is received.
  The warning system must be improved. I hope that there is no complacency about the present system. I was worried by a letter I saw from the water authority which said that, in the authority's view, the warning system worked satisfactorily and that the over-topping and severe wave action that occurred on the night of 30–31 December was an unusual and rare phenomenon, which could not have been forecast by the system as it exists. The authority went on to say that it believed that the Ministry of Agriculture, Fisheries and Food shared the same opinion. I hope that that is not the Ministry's opinion. If that is the system as it exists, it is clearly not adequate. The council emergency operation depends entirely on that warning system. I appeal to the Minister to speed up improvements in the system so that next time, if there is a next time, adequate warning is received.
  I turn to the question of financial compensation. It is a vital question. I do not pretend, in a short debate, to be

  883
  able to deal exhaustively with the dozens of points that arise when flooding on this scale occurs. I do not expect an answer in detail from the Minister tonight. It is essentially a matter for the Secretary of State for the Environment and relates to the help that can be given under section 138 of the Local Government Act. Last year, the Government decreed that they would reimburse local authorities for additional expenditure incurred as a result of the bad weather to the extent of 75 per cent. of the amount by which those losses exceed a one penny rate product. It sounded helpful at the time, but, whatever the good intentions of that proposition, it is not helpful in practice.
  The cost to Swale, which is not a rich borough, of the 1978 floods is likely to be about £217,000, including amounts granted to help individual householders. That is just over a one penny rate product. It means that Swale will get little or nothing on this Government's formula for 1978. Just as they have completed repairs on the houses, they face another major loss. Total losses are likely to be of the same order as last year. In many instance, much of these two losses will be borne in the same financial year.
  I would like to ask if the Government would allow the council and, presumably, other councils to put together losses for the purposes of compensation. In the parliamentary answer I received, the Government decreed that each storm or flooding incident would be treated separately. This means that Swale must lose £200,000 every time before it gets any help. In effect, that means no help at all. I am sure that is not what the Government intended. I ask the Minister of State to go to the Secretary of State for the Environment and ask him to think again, and not close his mind to the possibility of aggregating the losses that have occurred throughout the year. The cost to the Government will be minimal. The help to Swale will be considerable. The help that Swale can give to individual householders and those who have suffered will also be considerable. The cost to the Government will be so little that I urge them to think again.
  I plead for the small businesses which suffered losses. About 40 businesses were flooded. They received no compensation in 1978. They cannot insure against flood
  884
  because the exposure is too great. The sea wall is their insurance, and it has failed them twice. In theory, legislation allows the council to help, but in practice the Government do not reimburse the council for such expenditure.
  I ask the Minister to understand the plight of small businesses which are struggling to survive two lots of almost crippling losses. Some of those involved are in the tourist business, which is so crucial of the Isle of Sheppey. It seems that the Government have not yet got the compensation formula right. I hope that they will learn from the sad experiences of 1978 and 1979 and the loss and suffering of householders and farmers.
  About 350 acres of farmland were flooded. That was less than last time, but it was serious for the farmers. I hope that the Government will learn from the suffering of businesses and the losses of local authorities. I urge them to introduce a more meaningful, even-handed and fairer system of compensation.
  Above all, I plead with the Government to help the people of Sheppey to get that new sea wall built as soon as possible.
  1.17 a.m.
  The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. E. S. Bishop): I should like to begin my reply by expressing sympathy on behalf of the Government to all those who suffered from the severe storms which marked the opening and closing days of 1978 and in particular to those involved at Sheerness and the Isle of Sheppey. The hon. Member for Faversham (Mr. Moate) has paid tribute to all those who helped. He made a number of points. I shall reply to as many as possible.
  The points which the hon. Member has made about the warning system and the sea defences are germane to the policy of successive Governments in respect of defence against the sea. This policy is based largely on the recommendations of the Waverley committee—or, to give its full title, the departmental committee on coastal flooding—which was set up following the disastrous East coast floods of 1953. It its report, the committee stressed that the primary consideration must be the protection of human life—the hon. Member stressed that point several times—and that first priority must,

  885
  therefore, be given to the setting up of effective warning systems to enable those at risk to get to safety before flooding takes place.
  The committee also recognised the need for authorities to be encouraged to give as much protection as is economically reasonable to areas which are at risk. It recommended that, where flooding would lead to serious damage to property of a high value such as valuable industrial premises, large areas of valuable agricultural land or compact residential areas, steps should be taken to provide a standard of defence which would afford protection against a flood of the 1953 level.
  I have no wish to be drawn into arguments with the hon. Member as to whether Sheerness is at greater risk of flooding than other towns along the East and Kent coasts. He may remember that at about this time last year the hon. Members for Isle of Ely (Mr. Freud) and Norfolk, North-West (Mr. Brocklebank-Fowler) were quite rightly showing a great deal of concern for their constituents at Wisbech, King's Lynn and other towns which had just suffered serious flooding.
  A number of towns and villages down the East coast—and, indeed, elsewhere, including London itself—are at risk of flooding and I fully accept that Sheerness is in this category. I propose therefore in the remainder of my speech to concentrate on the particular problems of that town.
  Let us look first at the warning system. The hon. Member has explained his misgivings, and it will help if I explain how the East coast storm tide warning service works.
  The service is based at the Meteorological Office at Bracknell. Its primary task is to provide forecasts of high water levels at certain ports—known as reference ports—along the East coast. It does this by using data received direct from constantly monitored tide gauges and from information about pressure systems, wind directions and so on, provided by the Meteorological Office.
  If these forecasts indicate that tides may exceed previously established danger levels at any reference port, the service issues warnings at between four and six
  886
  hours before high tide to the county police force. The police then consult the water authority, which has local knowledge of tides and danger levels. If its advice supports the forecast made by the warning service, the local police then pass on the warnings to public authorities, to emergency services and, if appropriate, to the public in areas thought to be at risk.
  That, in a nutshell, is how the main East coast warning system operates. It is important to understand that, although the service uses the latest available techniques and all the experience it has built up over 25 years of operation, it is not infallible. For example, a sudden local change in wind direction may create—or avert—danger. Another point to bear in mind is that the forecasts attempt to measure the probable height of "still water"—that is, they do not take account of abnormal wave action caused by high winds. The difficulty here is that, because of the configuration of our coastline, the wind direction may be a significant factor in some areas while not affecting others. Those closely concerned with the warning system recognise this. The Southern water authority, for example, has its own local warning system, which is based on forecasts of wind speed and direction obtained from the London weather centre. So the Kent coast has the benefit of a national and a local warning service—both of which are available to the police and the water authority—in judging whether a public warning should be given and, if so, which localities are likely to be at risk.
  Let us look at what happened at Sheerness on the night of 30–31 December 1978. On that night no public warning was given of the flooding. As I have explained, the East coast storm tide warning service's role is to give advance warnings of danger levels being exceeded at certain reference ports by exceptionally high tides. On this occasion, the flooding was caused not by exceptionally high tides but by overtopping of the defences by wave action as a result of very high winds. From its own local warning system, the SWA issued a preliminary warning to the police that flooding might occur, but the information available did not justify a public warning. The possibility of further refining of the local system is being actively considered. The water authority is discussing with the service the possibility of incorporating

  887
  into its local procedures a recently developed system for forecasting open sea wave heights. This has been developed by the Meteorological Office for the North Sea oil rigs, and there may be difficulties in converting the information into terms which are suitable for the prediction of inshore wave heights. But, if it proves possible to harness the information, this will be a very useful step in improving the flood warning system for exposed areas such as the Isle of Sheppey.
  I turn now to the question of the sea defences. First, I should like to sketch in the statutory background. The powers to undertake works of maintenance to and improvements of existing defences—and to undertake new works—are given by the Land Drainage Act 1976 to what are known as "drainage bodies". In general, this means water authorities, local authorities and, in certain cases, internal drainage boards. Within the water authorities, most of the powers under the Act are statutorily delegated to regional and local land drainage committees, the majority of whose members are appointed by county councils in the area.
  My right hon. Friend the Minister has no powers under the Act to undertake works himself and, because the powers of drainage bodies are permissive, he cannot direct them to undertake, or to refrain from undertaking, any particular improvement. Our role is thus normally confined to the payment of grant-aid in cases where proposals put to us for improvements or new works are technically sound and economically justified. However, the Government are also involved with land drainage, as with other areas of public expenditure, by way of the provision of resources so that capital programmes can be carried out.
  The Southern water authority has already agreed a programme of improvements to protect the towns of Sheerness and Queenborough at an estimated cost of over £10 million. When this scheme was approved for grant aid in 1975, the authority proposed to carry it out over a period of 25 years.
  I should perhaps mention here that when the proposals were first discussed publicly I understand that they were not universally welcomed by the people of Sheerness, mainly on amenity grounds. Indeed, I am told that some residents took the view that the authority was
  888
  being unduly alarmist in undertaking this work, which, when it is completed, will afford a very high standard of protection. In the event, the authority has been proved right to press on and we are pleased to be associated with the scheme to the extent that we shall pay grant at 85 per cent.—the maximum rate possible.
  Following the flooding of January 1978, the Kent local land drainage committee of the authority decided to speed up the programme, but I understand that in the light of the more recent flooding it will shortly consider whether to accelerate it even more. In considering this problem it will have to take account not only of the availability of its own resources—for example, the works, the letting of contracts, and so on—but of the effects of any increased expenditure on the rate precepts in Kent. As I have explained, the decision of this committee is the prime consideration at present, because, unless it decides to speed up its programme—and therefore ask us for more resources—our hands are tied.
  As an indication of the Government's policy towards sea defences, I should like to mention briefly what we have done within the past year or so. First, following the flooding in January 1978 we provided an extra £2 million for works in addition to those originally scheduled by water authorities to be carried out in the financial year 1978–79. Secondly, we have provided almost £4 million on top of the original provision for sea defence expenditure for 1979–80. In both cases, this action by the Government has meant that very ambitious sea defence programmes in the areas most affected could begin quickly and can continue to the full extent that water authorities have proposed.
  A large share of the extra resources has been allocated to Kent. It received an additional allocation of more than £2 million for 1978–79 and £2¼ million for 1979–80. Of this, the local land drainage committee proposes to spend £1 million in the current year and just over that amount in 1979–80 at Sheerness. This is a major spending programme and we await with interest the outcome of the Committee's consideration of the question whether expenditure should be further increased next year or in subsequent years. I understand that the

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  divisional manager of the water authority considers that the planned programme of expenditure at Sheerness in 1979–80 can be increased somewhat, and I am sure that the land drainage committee will pay considerable regard to his views. If it decides to accept this recommendation, the authority will have to decide whether it can meet this higher expenditure from its existing capital resources or whether it will have to ask us for an additional allocation.
  If the authority does ask us, I can do no better than to quote from a recent letter to the Swale borough council by my right hon. Friend the Minister:
  "The Council may be assured that I am fully aware of and sympathetic towards the needs of the residents of Sheerness for better protection and that, if I am asked to provide additional capital, I shall do my best to help."
  I think that the hon. Gentleman will accept that it may be premature to receive a deputation until such an application is received.
  The hon. Member also raised the question of Government assistance to local authorities which incur expenditure as a result of floods or storms. That is not, of course, a matter within the responsibility of my Department, but in the expectation that it might be raised in this debate I have consulted my right hon. Friend the Secretary of State for the Environment.
  The hon. Member seemed to be implying that the level of central Government support to local authorities which suffer as a result of floods and storms is less than generous. We cannot accept this. As the hon. Member will recall, on 8 February last year my right hon. Friend the Secretary of State for the Environment announced the basis on which financial assistance would be given to local authorities which suffered as a result of the gales and floods which hit the country in November 1977 and January 1978. Briefly, the Government undertook to reimburse local authorities 75 per cent of net additional expenditure in excess of a penny rate incurred as a direct result of a disaster or emergency. He made it clear at that time that the same assistance would be available for future similar occurrences, and in his press statement on 2 January my right hon. Friend the
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  Minister of State, Department of the Environment confirmed that the arrangements would apply to the recent emergencies.
  In setting the formula on which the assistance is based, it was our intention to ensure that in discharging its functions under section 138 of the Local Government Act 1972 no local authority should be left to bear an undue burden from its own resources. At the same time, we have no wish to usurp the responsibilities which should be exercised locally. We cannot believe that the product of a penny rate is too high a price to pay for local autonomy in this matter.
  The hon. Member has pressed to have separate incidents aggregated for the purpose of exceeding this product and so attracting special Government assistance when, individually, they would not. In the circumstances which his constituency has experienced, I can understand his doing so, but the result would be to widen the scope and cost of what has always been envisaged as assistance towards incidents which were quite exceptional in their own right. It is for those reasons that, as the hon. Member knows, my right hon. Friend the Minister of State has concluded that aggregation for the purpose of Exchequer assistance would not be warranted. Nevertheless, it remains the Government's view that the formula that I have outlined to the House is a generous one.
  This has been a useful short debate. I have tried to explain to the hon. Member that the Government have already done their best in dealing with the serious problems at Sheerness but that on the important issue of improving the sea defences the decision is not in our hands at present. I emphasise again some of the points I have made and I conclude by assuring the hon. Gentleman of our continued sympathy and support to those local organisations—including the Swale borough council and the Southern water authority—which carry the responsibility for these matters.
  The Question having been proposed after Ten o'clock on Thursday evening, and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
  Adjourned at twenty-nine minutes to Two o'clock.