Commons Sitting of 21 February 1980

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS

  TYNE AND WEAR BILL [Lords] (By Order)
  Order for Second Reading read.
  To be read a Second time upon Thursday 28 February.

ORAL ANSWERS TO QUESTIONS
  NATIONAL FINANCE

    Public Sector Borrowing Requirement
    Mr. Foulkesasked the Chancellor of the Exchequer what increase in the public sector borrowing requiremnt is directly attributable to the increase in unemployment since May 1979.
    The Chief Secretary to the Treasury (Mr. John Biffen): I regret that I am unable to give the hon. Member the estimates he requests, for reasons set out in the Minister of State's answer to him of 11 February.
    Mr. Foulkes: Since the public sector borrowing requirement is central to the Government's economic policy, is it not time that the Government made a prediction of the effect of increased unemployment upon it? Can the Minister deny my prediction that if unemployment reaches the level of 2 million by the end of the year—which has been predicted elsewhere—that will result in an increase in the public sector borrowing requirement of at least £2 billion which is the amount of money that the right hon. Lady the Prime Minister is attempting to save in public expenditure cuts? Is that not crazy?
    Mr. Biffen: I cannot confirm the hon. Gentleman's prediction, not least because it has been the practice of successive
    632
    Governments, irrespective of political colour, not to engage in forecasting levels of unemployment.
    Mr. Alan Clarke: Will my right hon. Friend agree, however, that unemployment is likely to continue to increase, with its attendant effect on the PSBR, until the gigantic overseas job creation scheme, in which the British consumer participates, is corrected by Government intervention which would be fully in accord with the ancient traditions of our party?
    Mr. Biffen: I acknowledge that my hon. Friend is a long-standing supporter of import controls, but there must be a balanced judgment on the extent to which British industry today needs more protection, rather than more competition.
    Mr. Healey: While I understand why the right hon. Gentleman is unwilling to verify or endorse the predictions published by his Department about the massive increase in unemployment which is now under way, surely he has made some estimate of the effect of an increase of 100,000 unemployed on the public sector borrowing requirement? Is it not a fact that the main reason why we now face three years of unparalleled austerity—or, as his right hon. and learned Friend the Chancellor of the Exchequer told the press this week, a steady fall in real living standards for at least three years—is that the Government's fiscal and monetary' policies ensure that the massive increase in oil revenues, which will amount to £4 billion this year, will entirely finance increases in unemployment caused by the Government's policies?
    Mr. Biffen: I am following well-ordered precedent in declining to forecast levels of unemployment.
    As to the wider issues, the success of the United Kingdom economy will turn largely upon its becoming more competitive and being able compete realistically in world markets. That will involve pursuing policies which have a degree of monetary realism to enable the supply side of the economy in its turn to be a great deal more effective than it has been over the past decade.

    Widows (Taxation)
    Mr. McQuarrieasked the Chancellor of the Exchequer what progress his

    633
    Department has made to alleviate the position regarding widows' pensions and taxable income, when the widow takes up employment and is taxed on the gross income of pension and wages.
    The Minister of State, Treasury (Mr. Peter Rees): I have the tax position of widows under review, and I met representatives of the National Association of Widows on 13 February. I have noted the point made by my hon. Friend.
    Mr. McQuarrie: I am grateful to the Minister for that reply. I should like my hon. Friend to remember that the Budget is close, and that we are hopeful that when my right hon. and learned Friend the Chancellor makes his Budget Statement he will take into consideration that fact that those widows are heavily penalised. Action must be taken as part of the grossing operation to give them relief. The husbands paid for the pensions before they died, and their widows are entitled to receive them.
    Mr. Rees: I have no doubt that my right hon. and learned Friend will take full account of the points made by my hon. Friend, but I cannot anticipate his Budget.
    Mr. R. C. Mitchell: Does the Minister prefer the woman concerned to go out to work or to apply for supplementary benefit?
    Mr. Rees: I do not believe that it is for me to express a preference between those two options. However, I do feel that the tax system is loaded in a way that would indicate a particular course of action to a lady in that unfortunate position.
    Mr. Horam: Will the Minister consider taking the widow's allowance out of the tax system for the first six months after her husband dies? Will the hon. and learned Gentleman accept that it is the only short-term benefit that is at present subject to tax? Does he agree that the cost of making it non-taxable would be small and would be much appreciated by widows?
    Mr. Rees: There is an anomaly. As the hon. Gentleman will realise, it can be cured in one of two ways.
    Mr. Cormack: Is my hon. and learned Friend aware that his predecessor at the
    634
    Treasury received deputations from the National Association of Widows with great courtesy, year after year, and did nothing? Will he endeavour to improve on that?
    Mr. Rees: I hope that I have matched the courtesy of my predecessors. We shall certainly take note of the point made by my hon. Friend.

    Retired Persons (Taxation)
    Mr. Hicksasked the Chancellor of the Exchequer if he will meet representatives of pensioners' organisations to discuss the taxation position of the retired.
    Mr. Peter Rees: We have no immediate plans to do so; but we keep the taxation position of the retired under regular review.
    Mr. Hicks: In view of the economic difficulties facing those on fixed and low incomes, many of whom are of retirement age, will my hon. and learned Friend use every influence that he has with the Chancellor to persuade him to abolish the earnings rule in the forthcoming Budget, instead of merely phasing it out over the lifetime of this Parliament?
    Mr. Rees: We are conscious of the commitment in our manifesto. My hon. Friend will appreciate that at this stage I can go no further than that.
    Mr. Denzil Davies: In view of the difficulties faced by pensioners and others, will Treasury Ministers make it absolutely clear that they have no intention in the Budget of breaking the link between prices and personal tax allowances? Those same right hon. and hon. Gentlemen, when in Opposition, encouraged and assisted in that law being passed.
    Mr. Rees: The right hon. Gentleman's contributions to debate on that amendment will be recalled, not least by his hon. Friends. I cannot anticipate my right hon. and learned Friend's Budget.

    Economic Situation
    Mr. Dormandasked the Chancellor of the Exchequer if he is satisfied with current developments in the economy.
    The Chancellor of the Exchequer (Sir Geoffrey Howe): It will take time for our policies to check the long-run decline of the economy which we inherited.
    Mr. Dormand: How much more evidence does the right hon. and learned Gentleman require to convince him that excessive monetarism is not good for the economy? Will he accept that it is absolutely clear that that is the main cause of our economic problems, not least de-industrialisation, which is proceeding apace in the Northern region? If the right hon. and learned Gentleman will not listen to us, will he at least listen to a few of his more intelligent hon. Friends who share our concern?
    Sir G. Howe: It is important for the House to appreciate that there is no question of excessive monetarism. If interest rates are higher than is tolerable for the revival of industrial prosperity or other conditions, that is a consequence of public sector borrowing and spending being too high. The hon. Gentleman is entirely wrong to attribute de-industrialisation to excessive monetarism or to any policies of this Government. He should recollect, for example, that between 1973 and 1979 manufacturing output fell by 5 per cent. That was long before excessive monetarists, as he chooses to put it, came near the Treasury.
    Mr. McCrindle: Will my right hon. and learned Friend accept that I endorse the general aims of the Government's economic policy and most of the monetarist means of attaining it? However, is the Chancellor of the Exchequer totally satisfied that those policies are being applied with sufficient flexibility and sense of timing in order not unduly to undermine the social objectives of our Administration?
    Sir G. Howe: I am entirely satisfied in that respect. Indeed, the anxiety that people must have experienced is that the country had to wait until a change of Government before returning to the prospect of monetary discipline. It is only when our policies in that regard have been followed and made effective that we can set about pursuing the social objectives on which my hon. Friend and I so firmly agree.
    Mr. Healey: If the right hon. and learned Gentleman is satisfied with the progress made by the economy under his Chancellorship, why did he not warn the electorate nine months ago that the
    636
    country was in for 20 per cent. inflation and 20 per cent. increase in wage costs? Further, will he accept that last week we should have seen a 20 per cent. increase in interest rates had the Government not broken all their principles by lending £500 million to private banks to prevent the market from driving interest rates up?
    Sir G. Howe: The right hon. Gentleman knows as well as anyone in the House that the conditions that we inherited from him lead us—
    Mr. Healey: Nonsense!
    Sir G. Howe: I understand the right hon. Gentleman becoming so angry in the light of his own record. He must be reminded of the fact that we warned the British electorate at the last election that the country was facing an economic crisis more serious than any that we had faced since the end of the war and that it would take a number of years to begin restoring the health of the economy, which the right hon. Gentleman handed over to us.
    Sir William Clark: Does my right hon. and learned Friend agree that it is sheer hypocrisy for the right hon. Gentleman to citicise the Government's policies when, under his administration, unemployment doubled, taxation for the ordinary family doubled, prices doubled, the national debt doubled and the value of the pound was halved? [HON. GENTLEMEN: "Reading".] Does my right hon. and learned Friend agree that it is sheer hypocrisy?
    Mr. Speaker: Order. Before the Minister replies, let me say that the hon. Gentleman knows that it is quite un-parliamentary to accuse another hon. Member of hypocrisy. I am not asking the hon. Gentleman to give it another name. I just wish to point out that he used the word "hypocrisy".
    Sir W. Clark: May I reply on a personal basis, Mr. Speaker? What I thought that I said was that the arguments were sheer hypocrisy. I did not necessarily accuse an individual Member of hypocrisy.
    Mr. Cormack: On a point of order, Mr. Speaker.
    Mr. Speaker: Order. I shall take the point of order at the end of Question Time.
    Mr. Cormack: It is a point of order that arises out of this matter, Mr. Speaker. The Shadow Chancellor distinctly called my right hon. and learned Friend a liar.
    Mr. Speaker: Order. If that is so, it is distinctly un-parliamentary and will be withdrawn.
    Mr. Healey: Further to that point of order, Mr. Speaker. May I correct the hearing of the hon. Member for Staffordshire, South-West (Mr. Cormack). I was simply recalling to my hon. Friend the Member for Norwich South (Mr. Garrett) that when we predicted the 12 things that a Conservative Government would do if they were elected, we were accused of telling lies. In fact, they doubled the rate of value added tax—
    Mr. Speaker: Order.
    Mr. Healey: They increased prescription charges—
    Mr. Speaker: Order. The right hon. Gentleman knows that he must resume his seat when I stand. If he did not accuse the right hon. and learned Gentleman of being a liar, that is an end of the matter. I merely wished him to withdraw it, if he had. It is as simple as that.
    Mr. Burden: On a point of order, Mr. Speaker.
    Mr. Healey: Further to that point of order, Mr. Speaker. I was making it clear that I was referring to the accusation hurled at the Labour Party during the last election when we told the truth about the Conservative Party. I should never accuse the right hon. and learned Gentleman of lying. I have too little respect for his understanding to believe that he can ever tell the truth.
    Mr. Speaker: Order. I gather that the accusation is withdrawn.
    Mr. Robert Sheldon: Is the Chancellor aware that his exchange rate policy is directly responsible for the large amount of manufactured imports and the difficulties that our manufacturers have in exporting their goods? Is he further aware that the consequences for our industry are extremely serious? Will he instruct the
    638
    Governor of the Bank of England to intervene properly and effectively to keep exchange rates at a reasonable level?
    Sir G. Howe: The right hon. Gentleman should know, because he may well recollect what was said by his right hon. Friend the Member for Llanelli (Mr. Davies) only last summer, that the exchange rate is clearly one of many areas in which Government cannot have control. He should also understand that the exchange rate is fundamentally determined by market forces. Any sustained attempt to influence it by a change of intervention policy would have adverse consequences on other aspects of economic policy.

    Family Income Supplement
    Mr. Ralph Howellasked the Chancellor of the Exchequer why income tax is deducted from persons who receive family income supplement.
    Mr. Peter Rees: Recipients of family income supplement are liable to tax if their income is above the tax thresholds.
    Mr. Howell: I consider that a very unsatisfactory reply. Is the Minister aware of how ludicrous it is that a man with three children, earning as little as £55 per week, pays £5·31 in tax and receives £5 in family income supplement? When will we stop this nonsense? I ask my hon. and learned Friend to urge his right hon. and learned Friend to do something about this in the Budget. The only way to solve this problem is to raise tax thresholds well clear of FIS levels and I urge that most strongly.
    Mr. Rees: I hope that, on reflection, the House and my hon. Friend will recognise that my answer to his question was entirely factual. I note the point he made about thresholds. I am sure that the House will recall the dramatic increase in thresholds in both the first and second Finance Bills of last year.

    Budget Strategy
    Mr. Leightonasked the Chancellor of the Exchequer if he is satisfied with the way in which his Budget strategy is working.
    Sir Geoffrey Howe: The Budget measures were an important first step in tackling the difficult economic situation

    639
    we inherited. The money supply had been allowed to grow rapidly, inflation was accelerating, and output was stagnant. It will take time to overcome these handicaps.
    Mr. Leighton: Is the Chancellor of the Exchequer aware that few of us have noticed the advent of the entrepreneurs who were to be unleashed by his alleged incentive Budget? Instead we have a declining growth rate—the lowest in the Western world—the highest inflation rate and the highest interest rate, I believe, since the battle of Waterloo.
    Mr. Speaker: Order. The hon. Gentleman was called to ask a question, not to give information.
    Mr. Leighton: May I end by saying that the chamber of commerce in my constituency has approached me saying that the high interest rates are killing off businesses?
    Sir G. Howe: I hope that in those circumstances I shall have the unqualified support of the hon. Gentleman for the Government's attempts to reduce public spending, and so public borrowing and interest rates.
    Mr. Bob Dunn: Does my right hon. and learned Friend accept that one of the most important side effects of the Budget is the degree of understanding by British workers of the economic realities, as witnessed by the ballots at Longbridge yesterday and at the Welsh pitheads earlier today?
    Sir G. Howe: I am as encouraged as my hon. Friend by the extent to which the wisdom of the working people of this country is becoming increasingly apparent in the way in which they are overruling the wishes purported to be expressed by some of those who claim to speak on their behalf.
    Mr. John Garrett: What is the Chancellor of the Exchequer's opinion of the report from the United States Council of Economic Advisers, an extremely distinguished body advising the President and Congress, that the British Government's policies are driving the British economy into a deeper recession than exists in any other country in Western Europe?
    Sir G. Howe: I am not particularly impressed by comments quoted out of context from other countries. I confess that it is more than one can do to keep abreast of the advice that is tendered in one's own country. I cannot regard that diagnosis or verdict as having any foundation in fact.
    Mr. Bruce-Gardyne: Does not my right hon. and learned Friend agree that it is a bit rich for the Opposition to launch into the sort of comments they are making this afternoon when, in 1975, they presided over rates of inflation far in excess of those we are experiencing today and blamed the situation wholly on the monetary policies of the previous Government? Is not the evidence that the same is true today and that what we are facing today are the pure consequences of the misbehaviour of the right hon. Member for Leeds, East (Mr. Healey)?
    Sir G. Howe: It would be unfair to blame the right hon. Member for Leeds, East for every aspect of our economic misfortunes. But, subject to that generous qualification, I agree entirely with my hon. Friend.
    Mr. Buchan: Did the Chancellor notice the article in The Observer on Sunday written by one of his colleagues which appeared to reflect the gradual awakening of his own party to the disastrous effects of his Budget? The Budget was described as A-level economics. I wonder how many marks the Chancellor of the Exchequer would award himself?
    Sir G. Howe: I notice that, as always, the former Chancellor of the Exchequer is unable to remember a quotation even four or five days old. If I may comment on the quotation, one of the facts that has struck me about the progress of our economy in recent years is that the larger the number of economists employed close to the machinery of government, the less conspicuous has been our economic success. I am content to rest our economic policies on the broad programme of common sense which secures the overwhelming support of most people.

    Money Supply
    Mr. Eggarasked the Chancellor of the Exchequer if he will take action, in

    641
    the light of the January banking figures, to control the growth in the money supply.
    Sir Geoffrey Howe: It is important not to place too much emphasis on any one month's figures. The action that has already been taken to restrain monetary growth will have effect only over a period of time.
    Mr. Eggar: I am grateful to my right hon. Friend. While accepting that monetary policy is a medium-term policy, may I ask if he does not agree that the recent action of the Bank of England over the last make-up day interferes with the short-term efficiency of the money supply? Does he feel that a change to monetary-based control would be of assistance in using the monetary supply as a short-term method of control?
    Sir G. Howe: The recent action by the Bank of England in relation to the money supply made no fundamental change to the operation of the policy. It was an adjustment to a temporary shortage of liquidity. The long-term objectives and policy methods remain the same. As my hon. Friend knows, we shall shortly be publishing a consultative document on monetary policy dealing with monetary-based control and the possibility of some movements in that direction. If any such movements finally commend themselves to opinion, they will not be a fundamental change nor a substitute for the essentials of monetary policy.
    Mr. Healey: But is it not right that money supply since October has been running at roughly twice the target level of 7½ per cent. which the Government set themselves for the year to next October? One reason for that is that the Bank of England has been intervening to try to keep the exchange rate from destroying British manufacturing industry, which is the inevitable result of the interest rates presently adopted by the Government. Can the right hon. and learned Gentleman answer the question that I think was being put by his hon. Friend? Would it not have been absolutely impossible if the Government had adopted monetary-based control, for the Bank of England to lend £500 million to the clearing banks to prevent interest rates from rising even further?
    Sir G. Howe: The point the right hon. Gentleman makes about monetary-based control is one of the factors that will he considered and canvassed in the consultative document when it is forthcoming and one of the factors that will have to be considered before we come to any conclusion about it. He should certainly not conclude that intervention by the Bank of England has been a significant factor in causing changes in the money supply in recent months.
    Mr. Richard Wainwright: In order to reduce public confusion about the Government's monetary aims, will the Chancellor of the Exchequer now publish long-term targets for the growth of money supply?
    Sir G. Howe: This again is an interesting point that the hon. Gentleman knows we have under consideration. There is no room for confusion whatever about the Government's monetary aims. It is our intention progressively to reduce the rate of growth of the money supply as the foundation of our policy for the conquest of inflation, but I am glad to know that I have hon. Gentleman's support.
    Mr. Tapsell: While nobody would underrate the importance of the proper management of the money supply, is it not a disquieting aspect that we have had such difficulty in accurately controlling it? Has my right hon. and learned Friend noted the growing opinion in banking circles that much more speedy and effcetive results could be achieved by a directive to banks and other lending institutions to bring their lending within the guidelines laid down by the Government? Should we not also emulate the example of our industrial competitors overseas and take direct action to discourage the over-large inflow of foreign funds which is increasing our money supply and damagingly affecting the exchange rate of sterling internationally?
    Sir G. Howe: I know that my hon. Friend takes a close and informed interest in these matters, but it would be wrong to conclude that inflows from overseas have been a significant factor affecting monetary control recently. I know also the way in which the case can be argued for more direct controls than those

    643
    operated at present. But experience has shown increasingly that each such control is all the more likely to be evaded by subsequent sophistication. There is no fundamental substitute for reassessing the discipline of price through interest rates which follows the reduction of public borrowing and public spending.
    Mr. Jay: After nine months in office, does the Chancellor feel that his policies are succeeding?
    Sir G. Howe: I am confident that they are succeeding, yes. I am grateful to the right hon. Gentleman for giving me the opportunity to point out that we have another four and a quarter years in office. All sensible economic policies and attempts to restore economic discipline are bound to take a substantial period of time. The Government will wish to be judged, not by their record of 100 or even 400 days, but at the end of the remaining four and a quarter years.

    Building and Construction Industry (Tax Exemption Certificates)
    Mr. Lennox-Boydasked the Chancellor of the Exchequer if he will publish a consultative document of proposals, with a view to introducing amending legislation in respect of tax exemption certificates in the building and construction industry.
    Mr. Peter Rees: A consultative document on the construction industry tax deduction scheme was issued on 25 January and copies are available in the Library.
    Mr. Lennox-Boyd: I thank my hon. and learned Friend for that answer, but does he not agree that there is great injustice to self-employed people who have recently worked abroad and who, when they wish to take up their occupation in the United Kingdom, are prevented from doing so because of their absence abroad and the inability of the Inland Revenue to grant an exemption certificate? Does he not agree that the solution to the problem is simple? Such persons should be able to make applications to the general commissioners who can decide the matter on the basis of evidence produced to them as to whether it is a genuine case or someone who is trying to abuse the system?
    Mr. Rees: I recognise from the many cases that have been drawn to my attention the harshness of the 3-year rule. I doubt whether a simple solution can be found to the problem, although one or two are suggested in the consultative document. I take note of my hon. Friend's point about giving the appeal commissioners—the matter need not necessarily be restricted to the general commissioners—a more general discretion. Again, he will find that there are suggestions to that effect in the consultative document.

    Bank of England
    Mr. Stephen Rossasked the Chancellor of the Exchequer when next he will meet the Governor of the Bank of England.
    Sir Geoffrey Howe: Shortly.
    Mr. Ross: When the Chancellor meets the governor of the Bank of England, will he inquire of him why he has taken so long to finalise the long-promised Green Paper on the control of the money supply? Will he able to finalise with the governor a date for the publication of that Green Paper?
    Sir G. Howe: The Green Paper is being prepared jointly between the Bank of England and the Treasury. We hope to be able to publish it shortly.
    Mr. Denzil Davies: When the Chancellor meets the governor, will he, after that meeting, explain to the British people why the Government printed £500 million last week in order to give the banks extra money to lend, whereas they are not prepared to raise cash limits to save the jobs of steel workers and coal miners?
    Sir G. Howe: The Government allowed the Bank of England to adjust one aspect of monetary control last week. Monetary policy depends upon fiscal policy as well as upon interest rates. There is no need, especially at this point of proximity to the Budget, for one of those measures to carry the entire burden.
    Mr. Higgins: Does the Chancellor agree that there is a fundamental difference between a policy which seeks to control money supply by reducing the PSBR and one which seeks to finance that borrowing requirement by borrowing on behalf of the Government at high rates

    645
    of interest? Is it not the first policy that we should be pursuing and not the dangerous second policy?
    Sir G. Howe: I agree entirely with my right hon. Friend. That is why we have applied our endeavours to achieve a reduction in the Government's borrowing requirement by a progressive reduction of that requirement and Government spending. That is at the heart of Government policy and I am grateful for my right hon. Friend's support.
    Mr. Healey: Will the right hon. and learned Gentleman answer the question that was asked by my right hon. Friend the Member for Llanelli (Mr. Davies), namely, why have the Government printed £500 million to lend to the private banks in order to stop interest rates rising under market pressures which, if the monetary-based system that the Chancellor has endorsed is adopted, would, in any case, take place automatically?
    Sir G. Howe: The monetary-based system is not yet ripe for adoption. It will shortly be ripe for discussion and consideration. I look forward to hearing the views of the right hon. Member for Leeds, East (Mr. Healey) on it at that time. Meanwhile, I shall re-answer the question that I have already answered once. Monetary policy does not depend exclusively on interest rate policy but on fiscal policy as well. We shall shortly have an opportunity to reconsider that at the time of the Budget. There is no need, in the circumstances that the right hon. Gentleman refers to, to allow the entire burden of monetary policy to be carried on interest rates.
    Mr. Bruce-Gardyne: Further to the question of my right hon. Friend the Member for Worthing (Mr. Higgins), is my right hon. and learned Friend aware that the best news in months for some of us has been the reports carried widely in the press in recent days that the Treasury is determined to achieve a PSBR next year that will be substantially lower in money terms than the out-turn in the current financial year?
    Sir G. Howe: I am glad that my hon. Friend is so encouraged by his reading of the popular press. I hope that he looks forward with as much anticipation as I do to the Budget.
    Mr. Woolmer: When the Chancellor meets the Governor of the Bank of England, will he discuss with him the right hon. and learned Gentleman's view that the foreign exchange rate cannot be controlled and must be left to market forces? Will he insist upon the common sense and industry view that the exchange rate must be brought down, otherwise the market forces that he appears to welcome will destroy our industry on the basis of the hoped-for value of North Sea oil?
    Sir G. Howe: The hon. Gentleman should understand that, on the occasions in the past when determined attempts have been made to lower the exchange rate, it has not been a conspicuously successful prescription for economic triumph. It is not possible for the exchange rate to be determined in a way that disregards market prices.

    Stamp Duty
    Mr. Stoddartasked the Chancellor of the Exchequer when he intends to raise the exemption limit for stamp duty on house purchase.
    Mr. Peter Rees: I cannot anticipate my right hon. and learned Friend's Budget proposals.
    Mr. Stoddart: I wish that the hon. and learned Gentleman would—especially on this issue. However, is the hon. and learned Gentleman aware that the stamp duty upper limit has not been increased for many years and is wildly out of date? It particularly affects those buying houses at a price of over £30,000. Will he consider the matter seriously and bring something forward in the budget?
    Mr. Rees: We shall consider that matter seriously. The hon. Gentleman will remember the debates that were held under the previous Administration on that point.

    Value Added Tax
    Mr. Altonasked the Chancellor of the Exchequer how much has been received from the value added tax charged on confectionery since the rate was raised to 15 per cent.
    Mr. Peter Rees: Because traders registered for VAT are not required to make returns of the particular goods and services on which tax has been charged,

    647
    I regret that this information is not available. However, the amount of VAT charged by traders at the 15 per cent. rate on sales of confectionery up to the end of December 1979 is estimated to have been about £100 million.
    Mr. Alton: In the wake of redundancies and lay-offs at firms like Barker and Dobson, I wonder if the Minister will tell the House whether he agrees that the amount of money collected in VAT is outweighed by the money that has to be paid out in short-term working schemes such as the temporary compensation scheme and unemployment benefits for many workers in sweet-making factories who are suffering as a result of the high level of VAT?
    Mr. Rees: I am not certain whether I can make the precise calculation that the hon. Gentleman asks of me. I hope the House will recognise that VAT is not the most sensitive instrument for treating that sort of problem.
    Mr. Denzil Davies: Since the increase in VAT to 15 per cent. in the Budget was so disastrous, and has caused at least 4 per cent. of the inflationary problems that we are suffering, will the Minister make clear that there will be no further increases in indirect taxation in this Budget with the further inflationary effects of that?
    Mr. Rees: The right hon. Gentleman is too experienced in these matters seriously to expect me to anticipate my right hon. and learned Friend's Budget.

    Enterprise Zones
    Mr. Murphyasked the Chancellor of the Exchequer if he will establish enterprise zones in and around older cities and new towns.
    Mr. Biffen: I refer my hon. Friend to the answer given by my right hon. and learned Friend the Chancellor to a similar question from the hon. Member for Salford, East (Mr. Allaun) on 31 October 1979.
    Mr. Murphy: I thank my right hon. Friend for that reply, but does he not agree that, with regard to the unemployment difficulties that are faced by a number of new towns and older town areas, it would be helpful if such enter-
    648
    prise zones could be set up to attract employment to those areas?
    Mr. Biffen: I am sure that my hon. Friend is right and the matter will receive the most sympathetic consideration.
    Mr. Kilroy-Silk: Does not the Chief Secretary know that there have been thousands of redundancies on Merseyside since his Government came into office, all of which are directly attributable to the Government's economic policies? Would not the Government be more sensible to try to deal with those deep-seated problems rather than to establish enterprise zones which will benefit only spivs and speculators?
    Mr. Biffen: I could bear the charges about unemployment a little more easily if they did not come from those who supported a Government who saw an increase of 700,000 in the level of unemployment between 1974 and 1979.
    On the second point, I hope that the hon. Gentleman could be sufficiently detached to welcome this initiative.
    Mr. Steen: Does my right hon. Friend agree that if we are to revive the older towns as well as the new towns, we must bring back private enterprise and those who live on the urban fringes? What steps will he take to provide incentives for people to start new firms and businesses on some of the derelict land and in the vacant spaces in the older towns?
    Mr. Biffen: When the proposals for enterprise zones have been fully formulated they will be presented to the House. I cannot, in any sense, anticipate them. I assure my hon. Friend that the points that he has mentioned are well in mind.
    Mr. Mike Thomas: Will the Minister tell the people of Newcastle upon Tyne who are facing redundancies in the shipbuilding industry, the power plant industry, and at Vickers Elswick in the defence industry what help they will receive?
    Mr. Biffen: I cannot indicate what will be the locations of the enterprise zones that are to be decided upon.

    Exports (Exchange Rate Effects)
    Mr. Strawasked the Chancellor of the Exchequer what effects he estimates the present sterling exchange rates are

    649
    having on the level of United Kingdom exports.
    Sir Geoffrey Howe: It is difficult to distinguish the effects of exchange rate changes from other influences on the United Kingdom's export performance. Others include the fact that United Kingdom wage costs have been rising more rapidly than those of our major competitors, and the recurrent exposure of our manufacturing industry to bouts of industrial disruption.
    Mr. Straw: Is not the Chancellor aware that partly, at least, as a result of his exchange rate policy there has been a staggering decline in the competitiveness of British manufacturing industry following the May election? Far from his policy producing a virtuous circle it is producing a vicious circle of high unemployment, high inflation, and closures in manufacturing industry.
    Is he denying that none of his policies has had, or can have, an effect on the exchange rate?
    Sir G. Howe: I am aware of the problems being faced by some parts of the British exporting industry. Those difficulties do not arise so much from the level of the exchange rate as from deep-rooted structural problems. There are no short cuts to improving our trading performance. As experience in Britain and in other countries has shown, depreciation provides no more than a short-term benefit to exporters and has a long-term cost in higher inflation.
    Mr. Nelson: Is my right hon. and learned Friend aware of the fallacious arguments put forward in favour of an artificially low rate of exchange? Does he not agree that it has a substantial advantage in terms of the cost of imported raw materials for many industries? Is it not the case, in many instances, that it is impossible and extremely expensive to try to influence centrally the rate of exchange?
    Sir G. Howe: I agree entirely with the last point made by my hon. Friend. Import costs have been rising substantially during the past 12 months. Input costs to British industry last year rose by 27 per cent., which was three times as much as in the preceding year. That was due largely to rising oil prices. Had the
    650
    exchange rate been depreciating at the same time the position would have been worse.
    Mr. Healey: Does not the Chancellor know—if he does not, he will discover it from the Secretary of State for Industry—that the overwhelming factor facing British industry in markets at home and abroad is that the exchange rates have risen together with an increase in wage costs? A major reason for that are the excessive interest rates in this country. The proof of that is what happened this week when the gap between American and British interest rates began to narrow and the sterling rate dropped 2½ cents in a day.
    Sir G. Howe: Of course relative interest rates are one of the factors that can influence relative levels of the exchange rate. The right hon. Gentleman's experience when he was at the Treasury should have taught him that there are deep-seated underlying causes of our industrial decline which his five years in office failed to remedy.
    Mr. Healey: Of course there are many factors which for 100 years have been responsible for the relative decline in British industry. The point that I am putting to the right hon. and learned Gentleman, which is the point of the question, is that the excessive strengthening of sterling over the past 12 months is a major factor in accelerating the decline of British industry. It arises largely from the excessively strict monetary policy supported ineffectively by excessively high interest rates.
    Sir G. Howe: The right hon. Gentleman again understands the causes very clearly. In so far as interest rates in this country have an impact upon the exchange rate of the pound sterling, I hope that he will support us in our determined policies to reduce the size of public sector borrowing and public sector spending.
    Mr. Tapsell: Does my right hon. and learned Friend agree that it is important for the well-being of the British people that our exchange rate should be kept in some sensible relationship with the international competitiveness of British industry?
    Does he recall that when Germany and Japan were faced with similar problems as a result of an inflow of foreign

    651
    funds they took direct action to discourage such inflows? Can consideration be given to similar action being taken by Britain?
    Sir G. Howe: I fully understand the concern of those in exporting industry to see the exchange rate at a level with which they can cope effectively. It is affected by a number of different factors, including the success of our monetary policy. That is why it is so important that we succeed in our fundamental objectives.
    My hon. Friend will remember that the experience of other countries to which he has drawn attention, on inflow controls suggests that such measures have not often been effective in solving problems caused by a high exchange rate.

    PRIME MINISTER (ENGAGEMENTS)
    Mr. Beithasked the Prime Minister if she will list her official engagements for Thursday 21 February.
    The Prime Minister (Mrs. Margaret Thatcher): This morning I presided at a meeting of the Cabinet. In addition to my duties in this House, I shall be having further meetings with ministerial colleagues and others, including one with Mr. Vance.
    Mr. Beith: Does the Prime Minister accept the principle that it should pay people to work? If so, will she call in her Education Ministers this afternoon and ask them why they have adhered to arrangements for school meals and transport which ensure that a family man on supplementary benefit would be several pounds a week worse off if he took a job? A man on family income supplement would be similarly worse off if he worked overtime.
    The Prime Minister: The hon. Gentleman is referring to one of the problems that we have with the poverty trap. As the hon. Gentleman knows, one of the best ways to deal with that is to reduce the heavy rates of income tax.
    Mr. Montgomery: Does my right hon. Friend think that it would be helpful if the Leader of the Opposition stated clearly where his Party stands on the picketing that took place at Hadfield's last week and at Sheerness yesterday?
    652
    Does she agree that all that we have had from the right hon. Gentleman so far has been a deafening silence on a vital issue?
    The Prime Minister: I trust that the Leader of the Opposition will condemn everything except that which is permitted by the law, namely, peaceful picketing.
    Mr. Heller: In the course of a busy day will the Prime Minister take some time out to look at the A-level course in economics, as there are many on this side of the House, and indeed in the country, who, because of the disastrous economic policies being pursued by the Government, believe that the Government have not even reached A-level standard?
    The Prime Minister: The hon. Gentleman knows that the important issues do not depend upon A-level economics. The important issue is to persuade people to live within their means, and to get rid of excessive spending and excessive borrowing.
    Mr. Farr: May I ask my right hon. Friend the Prime Minister if her attention has been drawn to reports today that the EEC is once again contemplating sending subsidised butter to Russia? Will she confirm that she regards that as intolerable, and that she will inform Brussels accordingly?
    The Prime Minister: I am very happy to confirm the remarks of my hon. Friend. It is disgraceful that subsidised butter sales are to be started once again to Russia. It is very offensive not only to politicians on both sides of the House, but to every housewife who would like to have a similar opportunity in this country. We shall certainly inform Brussels accordingly.
    Dr. Edmund Marshall: Is the Prime Minister aware that this morning a notice was published in the name of the Boundary Commission for England making revised recommendations for constituencies in Essex, even though since 31 December the number of members of the commission has been less than the statutory quorum?
    Will the right hon. Lady take steps to have the notice withdrawn, and for the activities in the name of the commission to be suspended until the membership is properly constituted and there has been

    653
    an opportunity for the members to meet and deliberate?
    The Prime Minister: I understand that that report was completed last year and that the previous Boundary Commission gave instructions for it to be published. That is what has happened. The new Boundary Commission for Wales has not yet been appointed nor, indeed, has agreement been reached with the Opposition on who should be members of it. Agreement has been reached in respect of England, but the two are being held up until there is full agreement on both.
    Mr. Neubertasked the Prime Minister whether she will list her official engagements for 21 February.
    The Prime Minister: I refer my hon. Friend to the reply which I have just given.
    Mr. Neubert: After a year that has seen more working days lost in strikes than any year since 1926, is my right hon. Friend prepared to pay tribute to the plain good sense of the British Leyland workers, who by their decision yesterday demonstrated their understanding that one cannot strike one's way to prosperity and that strikes lead to loss of jobs and low living standards?
    The Prime Minister: I certainly pay tribute to that decision. I thought that it was a triumph for common sense.
    Mr. Greville Janner: Has the Prime Minister had time to consider the report published yesterday about the tragic death by battering of baby Carly Taylor in my constituency, as well as the statement by the director of social services that about 500 babies are at risk in Leicester alone, which means about 100,000 for the country as a whole? Can she give an assurance that in these times of increasing hardship and deprivation, those who care for the needy and the inedequate will have the resources that they require and will not be starved of them by Government cuts?
    The Prime Minister: I hardly think that that terrible case can be attributed to that particular cause. I share the hon. and learned Gentleman's concern over each and every case of cruelty to children, particularly those that are as totally tragic as the one to which he referred. My right
    654
    hon. Friend the Secretary of State for Social Services will, of course, be discussing it with the local authority social services.
    Mr. Parris: Will my right hon. Friend take time today—[HON. MEMBERS: "Write a letter."]—to allay widespread fears about the future of the sub-post office net work by drawing attention to the reassuring statements made by her right hon. Friend the Secretary of State for Social Services on Tuesday?
    The Prime Minister: I am grateful to my hon. Friend. I believe that the case was fully deployed in that debate. In fact, as my hon. Friend knows, we were trying to give an extra element of choice to those who wish to take their social security benefits in a different way. It is in keeping with our policy to have an element of choice, but it is not in keeping with that of the Opposition.
    Mr. Cryer: [HON. MEMBERS: "Write a letter.] I do not write stupid letters. Does the Prime Minister agree with the right hon. Member for Sidcup (Mr. Heath) that the get-tough attitude in international relations can only worsen those relations and can be dangerous for nations? Does she agree with that point of view?
    The Prime Minister: During his time in Government, my right hon. Friend was the first to see that this country had proper defence forces to protect its security. I was a member of his Government and was proud to be so.
    Mr. Marlowasked the Prime Minister if she will list her official engagements for 21 February.
    The Prime Minister: I refer my hon. Friend to the reply which I gave earlier.
    Mr. Marlow: Will my right hon. Friend have time today to arrange a meeting between the Leader of the Opposition and the workers from Sheerness and Longbridge so that he has the opportunity of learning about aspects of industrial and economic matters of which he has no knowledge at present?
    The Prime Minister: The demonstrations at Sheerness showed very much that workers today are interested in the right to work and the right to go to work unhindered. They are to be congratulated as is their management. Congratulations

    655
    should also go to the police for the excellent way in which they carried out their duties which are both to protect the right to work and also the right to picket peacefully.
    Mr. Hardy: As the right hon. Lady has suggested that she is concerned about children, as she did in her reply to my hon. and learned Friend the Member for Leicester, West (Mr. Janner), will she consider the appalling delay in the Government's response to the proposals of the Milk Marketing Board which will provide hundreds of millions of gallons of milk for our children at negligible cost to the United Kingdom Government, as the bulk of the moneys would be found by the Community? Can we not see children provided with milk, and money obtained from Europe, as the right hon. Lady is supposed to be concerned about these matters?
    The Prime Minister: I think that the hon. Gentleman is referring to the sale of milk to children in schools. That is done through the local authorities.
    Mr. Dover: Will my right hon. Friend today find time to send a letter to Sir Michael Edwardes congratulating him on the recent performance of Leyland Vehicles—that part of British Leyland which makes trucks, buses and tractors? Its export orders are at record levels and it is launching products on programme. Is she aware that Leyland Vehicles has now returned to a profitable situation?
    The Prime Minister: I am aware that certain parts of British Leyland are working extremely well and profitably, and I hope that they will soon be joined by other parts. The news about production in January was excellent. For the first time, the volume car workers in British Leyland met their production targets. I hope, therefore, that they will be successful in selling more of them to the British people.
    Mr. Dalyell: In her meeting with Mr. Vance this afternoon, will the Prime Minister report that there are some of us who have had in-depth meetings with the Indian High Commissioner and other Asians who are not apologists for the Soviet Union but who see Afghanistan in various tones of grey rather than black and white? They believe that that issue certainly does not constitute a reason for not going to the Olympics.
    The Prime Minister: As the hon. Gentleman knows, I and many of my right hon. and hon. Friends, like many of his hon. Friends, fundamentally disagree with him. The Soviet Union marched into an independent country and is still there in very great armed force. I draw the hon. Gentleman's attention to the excellent suggestion made yesterday in the European political group on cooperation that in future Afghanistan should be a neutral country, rather like Austria, and, therefore, have her security guaranteed.
    Mr. Body: Further to the question put by my hon. Friend the Member for Harborough (Mr. Farr), will my right hon. Friend care to guess the opinion of the Kremlin now of the Common Market's capacity to act against aggression in the future?
    The Prime Minister: I hope that the opinion of the Kremlin about NATO, which is really the defensive mechanism, is that it is a formidable Western alliance with formidable adherents particularly Great Britain.
    Mr. Leightonasked the Prime Minister if she will list her official engagements for 21st February.
    The Prime Minister: I refer the hon. Member to the reply which I gave earlier.
    Mr. Leighton: Will the Prime Minister today read the written answer published in Hansard on 6 February, which showed that our deficit in trade in manufactures with the EEC in 1979 was in excess of £4 billion, which is in addition to the cost of the CAP and the budget? In view of that, will she tell us the main economic advantages of British membership of the EEC?
    The Prime Minister: With great respect, I think that the hon. Gentleman misses the point. We have the same opportunity of markets in Europe as Europe has here. I hope that in future we shall take more opportunity to export to those markets.
    Mr. Cyril D. Townsend: Will my right hon. Friend find time to distance the British Government from the proposed commission into the alleged crimes of the former Shah, as such a commission is the wrong response to blackmail, is

    657
    unlikely to be fair and will gravely damage the future authority of the United Nations?
    The Prime Minister: Many of us have great sympathy with what my hon. Friend has said. But we are anxious to support the United States in any moves which will manage to secure the release of the hostages.
    Mr. William Hamilton: Did the Prime Minister read the report in The Sunday Times of last Sunday to the effect that heart patients in King's College Hospital are likely to die within days because the hospital lacks a few million pounds? The Government are spending £5 million on a refit of the Royal Yacht "Britannia". Does the Prime Minister think that that is a civilised or humane sense of priorities.
    The Prime Minister: As the hon. Gentleman knows, this Government have kept up expenditure on the National Health Service in real terms. We have even increased the cash limits to accommodate increased pay for nurses. The hon. Gentleman's criticism is thoroughly unwarranted.

BUSINESS OF THE HOUSE
Mr. James Callaghan: Mr. Speaker—[Interruption] I was rising and I shall continue to rise in order to ask the Leader of the House to state the business for next week. I had not expected such unstinted admiration from Conservative Members, although it has been widely expressed outside the House as a result of what I did on "Panorama" last Monday.
The Chancellor of the Duchy of Lancaster and Leader of the House of Commons (Mr. Norman St. John-Stevas): The business for next week will be as follows.
MONDAY 25 FEBRUARY—Private Members' motions until 7 o'clock.
Consideration of timetable motion on the Social Security Bill.
TUESDAY 26 FEBRUARY and WEDNESDAY 27 FEBRUARY—Progress on the remaining stages of the Companies Bill [Lords]
THURSDAY 28 FEBRUARY—Debate on an Opposition motion of no confidence in
658
the economic and industrial policies of Her Majesty's Government.
FRIDAY 29 FEBRUARY—Private Members' Bills.
MONDAY 3 MARCH—Supply [12th Allotted Day]: Subject for debate to be announced.
Mr. Callaghan: The Government are now beginning to emerge in their true colours as an authoritarian regime. However, the right hon. Gentleman looks a pretty unlikely candidate for the role of ayatollah. The Social Security Bill is complicated and technical. It robs the pensioners. It separates their pension increases from earnings for the first time in a year in which—thanks to the policies of the Government—earnings will rise faster than the retail price index. The provisions of the Bill are extremely complicated. It is the second Bill that the Government have guillotined in three weeks. Will the right hon. Gentleman ensure that the appropriate regulations will be published before the Bill is completed?
The immigration regulations were published yesterday. Will the right hon. Gentleman give a day for debating them? I shall return later to the question of the censure motion.
Mr. St. Jahn-Stevas: The immigration regulations will be subject to the negative procedure. It is open to the Opposition to pray against them, should they so wish. It does not lie in the mouth of the Leader of the Opposition to make remarks about an authoritarian Government. He was a member of a Government who established a world record by producing five guillotines in a day.
Mr. Callaghan: Is the Leader of the House aware that we shall not be satisfied with an hour and a half on those very important immigration regulations? I think that he will find that several of his hon. Friends feel that that is too short a period to debate such an important matter. We shall ask the right hon. Gentleman to reconsider what he said.
As for the guillotine motion and the motion of no confidence, two points arise. First, eight Government Committees have been set up to consider Government legislation. The Committee Floor in the morning or afternoon looks something

659
like a Chicago slaughter yard. Will the right hon. Gentleman consider, especially in relation to next Thursday's motion of censure, that Committees should not meet during that debate? Every right hon. and hon. Member should have a chance to be present in the Chamber. We shall then be able to debate the total lack of confidence in the Government's economic and social policies. They are dragging this country downhill fast.
Mr. St. John-Stevas: If there is a very intense legislative programme it is because the Government are fulfilling the mandate given by the general election. Select Committees decide when they meet. I cannot control them. Standing Committees also decide their sittings. However, I am sure that they will pay attention to the suggestion that has been made, as it is not unreasonable.
Sir Nigel Fisher: Perhaps, Mr. Speaker, I could reduce the temperature a little. When he considers future business, will my right hon. Friend bear in mind that it is many years since we had a debate on the Commonwealth? That might be an agreeable debate, and it would certainly go down well throughout the Commonwealth. Perhaps my right hon. Friend could arrange a short half-day debate on Commonwealth Day, 10 March, or during that week.
Mr. St. John-Stevas: I am most grateful for that constructive and helpful suggestion. I am afraid that I cannot promise an early debate on the subject. I thank the hon. Gentleman for lowering the temperature. My own temperature was low, anyway.
Mr. Canavan: May we have a statement from the Solicitor-General for Scotland about the treatment of pickets by Scottish courts as a result of Tuesday's statement by the Attorney-General? The Attorney-General has nothing to do with prosecutions under Scottish law. Is the Leader of the House aware of reports that yesterday six pickets in Scotland were fined a total of more than £500 for simple obstruction while at the same court another man—not a picket—was fined a mere £120 on five charges of police assault? Does that not prove that there is blatant discrimination against workers who are involved in a legitimate industrial dispute?
Mr. St. John-Stevas: It is not for me to criticise the courts in England or Scotland. Of course, I know that the law in Scotland is different from that in England. It is based on Roman law as opposed to common law. I shall convey the hon. Gentleman's remarks to the relevant Law Officer.
Mr. David Steel: Although my hon. Friends and I have already tabled a prayer against the immigration regulations, will the Leader of the House take note that it is not enough simply to give the usual hour and a half for debating this matter? The Government should give time to such a major issue.
Mr. St. John-Stevas: The right hon. Gentleman should remember that the matter has been fully debated. There was a full debate on the White Paper.
Mr. Beith: They are different.
Mr. St. John-Stevas: They are different in the sense that they have been altered to take account of the views expressed in the House. It is therefore unreasonable to ask for another full day's debate.
Mr. Stokes: Will my right hon. Friend find time for a debate on the violent picketing that has taken place this week? The House could then show its unstinted support for police officers in their enforcement of the criminal law of Britain.
Mr. St. John-Stevas: I do not think that a debate is necessary to show the views of the House. I believe that every hon. Member supports the police in the exercise of their lawful duties.
Mr. Merlyn Rees: On the question of the immigration rules, is the Leader of the House aware that the Select Committee on home affairs will produce a report on the European Convention on Human Rights with respect to these rules, which will be published shortly? That report deserves a debate in this House. The immigration rules deserve a day's debate on their own, but would it not be an advantage to discuss the two matters together? Is the right hon. Gentleman aware that the immigration rules are not just simple rules? They concern hon. Members in all quarters of the House.
Mr. St. John-Stevas: I agree that this is a matter of great importance, but the immigration rules have been debated in

661
principle in this House, and any question of their relationship to the Convention on Human Rights is at present hypothetical.
Mr. Cormack: Is my right hon. Friend aware of the widespread disquiet about the bizarre and disgusting decision to sell subsidised butter to the Soviet Union once again? Can we have a debate on this matter shortly?
Mr. St. John-Stevas: I do not think that I can promise an early debate. However, I shall convey my hon. Friend's feelings to the Foreign Secretary.
Mr. Foulkes: Has the Leader of the House had time to consider the matter raised by my hon. Friend the Member for Glasgow, Shettleston (Mr. Marshall) last week about the problems of Scottish school holidays and sittings of this House during the summer? Will he guarantee that the House will not sit in August? If he will not do that, will he tell me what I am supposed to tell my children about their summer holidays?
Mr. St. John-Stevas: Although I have some say in the matter, the progress of business in the House is not entirely within my control. It is certainly my hope that the House will not have to sit into August, but that is a matter that lies more in the hands of right hon. and hon. Members opposite than with me.
Mr. Latham: Has my right hon. Friend noticed early-day motion 428 in the name of the hon. Member for Hayes and Harlington (Mr. Sandelson) and other Labour Members, which, implicitly, strongly criticises the deplorable Labour Party broadcast attacking the police?
[That this House abhors political propaganda from any source designed to weaken and discredit the police; and confirms that the Police Force has the full confidence and support of Parliament and the nation in the lawful and impartial exercise of its duty and responsibility for the maintenance of law and order.]
Should not that motion be debated as soon as possible, so that the House can renew its support for the forces of law and order?
Mr. St. John-Stevas: I am afraid that I did not see the broadcast in question. Television is more a medium for appear-
662
ing on than for viewing. However, I have no doubt that my right hon. Friend the Home Secretary has noted with satisfaction the endorsement of law and order in the hon. Member's motion.
Mr. Douglas: Will the right hon. Gentleman accept that there should be a debate soon on the Finniston report on engineering, before we lose all our engineering industry?
Mr. St. John-Stevas: That is a most important report and I hope that its conclusions will be discussed in a number of other debates to which it is relevant.
Mr. Peter Bottomley: Before encouraging Committees of the House to rearrange their sittings for the debate on the motion of no confidence, will my right hon. Friend try to get a statement from the Leader of the Opposition making plain his views about the strike and the pickets at Sheerness, and whether he believes pay settlement should be above the current rate of inflation?
Mr. St. John-Stevas: I am sure that the right hon. Gentleman will have heard that request. I made a request to him at the weekend that he should break his Trappist silence, and I hope that by our joint efforts we will manage to get him to burst into song.
Mr. James Callaghan: I rise only to tell the right hon. Gentleman that I am very flattered by the requests from the Conservative Benches that I should express my views on a number of matters that are in the Government's interests and that arise from Government policy. I am grateful to acknowledge the tribute that Conservative Members pay me for the great influence that I obviously have on their Benches and throughout the country.
Mr. Faulds: When will the House have a chance to debate, and when do the Government intend to pursue, the Strutt recommendations on country matters, the more particularly because before the last general election there was biparty agreement on the need for such countryside legislation?
Mr. St. John-Stevas: It is quite clear that the agricultural and countryside interests are well represented on the Government Benches. This is a matter

663
that merits debate, but I cannot promise one next week.
Mr. Pollock: In view of the publication, this week, of the Bowman report on forestry and its serious implications for future Government policy, will my right hon. Friend arrange an early debate on this important but too often neglected topic?
Mr. St. John-Stevas: I have a number of very important topics to try to fit in, and I cannot promise an early debate.
Mr. Palmer: May I press upon the Leader of the House the importance of the question already raised about the Finniston report? Is he aware that the other place is about to debate it? Why, under this Government, are we always so much behind the times in industrial affairs?
Mr. St. John-Stevas: The fact that this matter is being debated in the other place is a justification for a bicameral legislature. It is one of the great advantages in having two Houses that when the timetable of one does not allow for a debate it can take place in the other. It is generally recognised that debates of this nature in the other place are of very high quality.
Mr. Crouch: Many references have been made to important reports. Will my right hon. Friend make arrangements for us to obtain copies of the Brandt commission report "North-South"? Does he realise that it is quite difficult to obtain it publicly? Today I went to a famous booksellers and asked for it and the attendant asked me whether it was fiction or non-fiction.
Mr. St. John-Stevas: That is not a parliamentary paper. I entirely agree that the Brandt report deals with a question of paramount importance for the future of the world—
Mr. Merlyn Rees: I agree.
Mr. St. John-Stevas: The fact that the right hon. Gentleman agrees with me does not give me any reason to change my opinion. I have no powers in this respect, but I shall do what I can through other channels to facilitate my hon. Friend's request.
Mr. Dubs: Has the Leader of the House noticed early-day motion 415, which criticises the Attorney-General for putting a block on a whole set of parliamentary questions?
[That this House deplores the fact that Mr. Attorney-General has, by sheltering behind proceedings currently before the courts, imposed a block on all questions about jury vetting.]
Will the right hon. Gentleman take steps to protect the interests of Back Benchers and ensure that Ministers cannot hide behind blocking of questions in order to avoid giving difficult answers?
Mr. St. John-Stevas: I do not think that the Attorney-General is seeking to block questions. He has reached the opinion that it is essential that the judgment of the divisional court be confirmed or reviewed at the highest level before he can give an authoritative statement on this matter. That is perfectly reasonable.
Sir Bernard Braine: In view of the continuing anxiety in this and other countries about the state of the world economy, the suggestions that are being made in influential quarters about a revival of protectionist measures, and the relevance of this to the Brandt report, to which my right hon. Friend paid a warm tribute, will he arrange for the House to discuss the matter at an early date?
Mr. St. John-Stevas: This is a subject that, in connection with aid policy in general, should be discussed at an early date by the House. I cannot promise an actual date, but I shall bear in mind the important representations that have been made to me.
Several Hon. Members rose—
Mr. Speaker: Order. I must remind the House that once again today there are far more right hon. and hon. Members hoping to participate in the debate than I can possibly call. Therefore, I must bear this in mind and also the fact that there is another statement. I shall call three more hon. Members before we move on.
Mr. Alexander W. Lyon: Will the Leader of the House reconsider his judgment about the Select Committee's report on the European Convention? This is

665
the first report from any of the new Select Committees. It was prepared in order to assist the House in its discussion of the immigration rules, and if it is to be properly debated there must be a full day's debate. Surely, to give less is to indicate contempt for the new Select Committee—contempt that the right hon. Gentleman, of all people, should not feel.
Mr. St. John-Stevas: Not only should I not feel it; I do not feel it. I regard the work of those Committees as being of major importance to the effective functioning of the House. I shall look into the question that the hon. Gentleman raised, but I cannot promise an early and separate debate.
Mr. Spriggs: In view of the Prime Minister's unqualified support for Jimmy Carter, the President of the United States of America, over Afghanistan and the Olympic Games, will the right hon. Gentleman arrange for an international affairs debate as soon as possible? Will he deal with the matter urgently?
Mr. St. John-Stevas: We had a debate comparatively recently on foreign affairs. As to the support of my right hon. Friend for the foreign policy of the United States in those two matters I think that it has the unqualified support, certainly of the Government side of the House, and of many other hon. Members.
Mr. Winnick: Bearing in mind the sort of speeches that the right hon. Gentleman used to make on immigration and race, should he not be the first to recognise the need for a full day's debate on the immigration rules?
Mr. St. John-Stevas: The point that I have been seeking to make is that we have already had that debate. The regulations have come forward and have been modified to take into account the views of hon. Members expressed in the debate in this House.
Mr. Speaker: Statement, Mr. Secretary Heseltine.
Mr. Cryer: On a point of order, Mr. Speaker. It would be helpful if, on future occasions when business questions are taken, instead of curtailing discussion by taking three further questions you could announce earlier, when there is clearly an imbalance between the two
666
sides of the House, that you intend to call all those who have been standing. If many hon. Members on one side wish to put questions it means that hon. Members are rising to catch your eye for a considerable time while hon. Members on the other side can intervene as and when they chose, thereby lengthening the time and depriving those who have been trying to put a question from the beginning of the opportunity to do so. I suggest it would be fairer, Mr. Speaker, if you adopted the course of saying that you would take all those hon. Members who had been rising as you have done before.
Mr. Speaker: I have from time to time—indeed, often—said that I will call those hon. Members who have been rising. However, I have to balance a number of interests. Today, to be fair to hon. Members who have a strong constituency interest and who may well not be called because of the time available, I thought that I would move on.
Mr. Hooley: Further to that point of order, Mr. Speaker. Would it not be more for the convenience of the House to set a time limit on business questions, so that hon. Members could be more clearly aware of how matters progress?
Mr. Speaker: The House might as well be aware that I receive a number of suggestions from hon. Members. I consider them all seriously. All have advantages and disadvantages. The disadvantage is that the rest of the House, most of the time, would not agree with the proposals put forward.

HOUSING (PUBLIC EXPENDITURE)
The Secretary of State for the Environment (Mr. Michael Heseltine): With permission, Mr. Speaker, I will make a statement on housing public expenditure.
The background to the decision that I am announcing today is well known to the House. This Government face the task of setting public expenditure at levels which the nation can afford. If we fail, the problems with which we are familiar will continue—a public sector consuming a disproportionate share of the nation's resources, high interest rates and declining investment in the private sector.

667
The harmful effects of the policies of recent years can be clearly seen in housing. By 1979, for the average new council house, taxpayers and ratepayers were contributing towards a subsidy of £30 per week. Council rents had fallen to an average of 6·4 per cent. of income, despite a commitment in the last Government's Green Paper to increase rents in line with earnings.
The net results of Labour's housing policy was to make new building for local authorities so expensive that in every year after 1976 local authorities of both political complexions responded by reducing their programmes. The rent policies of the last Government have been a major factor in the inability of local authorities adequately to meet housing costs, finance investment and maintain their existing stock.
Against this background, we have reassessed our housing policy. The Government's expenditure plans for 1980–81 and later years will be published in a White Paper next month but the local authorities, the Housing Corporation and the new towns will need to settle their programmes now. For these reasons, this year I am, exceptionally, making an oral statement.
Our reassessment of objectives must recognise the significant general improvement of housing conditions in the last 30 years. Home ownership has grown from 31 per cent. to 55 per cent. over that period, and we recognise the desire of most people to own their own home. In national terms, the supply of housing and demand are in better balance.
Needs and problems have become increasingly specific and local. The emphasis of public sector housing policy now must be to meet a particular needs, such as those of the elderly and the handicapped. We have to concentrate on modernising, improving and making better use of the existing stock, rather than on the general provision of new houses. We must encourage home ownership and the private rented sector.
We need, therefore, to adopt the new priorities that are reflected in the Housing Bill and that are critical given the economic background.
I come now to the programme for 1980–81. The housing investment pro-
668
grammes for local authorities in 1980–81 will be allocated £2,199 million at expected outturn prices. The Housing Corporation will be allocated £420 million for the work of housing associations. The new towns building for rent programme will be £151 million. In new town development, the proportion of owner-occupation is below the national average, yet the demand is high. In future, growth must be based increasingly on the private sector and homes for sale.
Taken together, these three housing capital allocations for 1980–81 will, in real terms, at 1979 survey prices, be about £540 million or 21 per cent. lower than the forecast outturn for 1979–80. These figures are for England. My Scottish and Welsh colleagues are making separate announcements.
In the new circumstances, it is even more important that local authorities should use available resources in the most effective way to meet local needs. In order to encourage this, the housing allocation to each authority from April 1980 will be in a single block and they will have much greater ability to decide their own priorities. They will also have the new opportunities opened up by the Housing Bill.
There is a range of ways to promote low cost home ownership—by selling council houses, securing land release for builders and encouraging starter homes, through low-cost building for sale, especially for tenants and those on the waiting lists, schemes for improving and selling houses, such as acquisition, improvement and sale, and homesteading, and also by promoting shared ownership and helping priority home buyers with mortgages. In these ways, people can be helped to become owners.
Full details are in the allocation letter to authorities, copies of which are in the Vote Office.
The priorities now must be value for money and concentration, under the more flexible arrangements, on the problem areas.
In the private sector, the introduction of shortholds and the other provisions in the Housing Bill will improve the availability of rented accommodation without additional public expenditure. Exchequer subsidy to local authorities for housing

669
last year amounted to £1,148 million in 1979 survey prices.
The rent levels of recent years have not only prejudiced the abilities of local authorities to maintain adequately their housing stock but have contributed to the enormous burden of public expenditure.
I have, therefore, concluded that it would be right to issue a supplementary rent increase guideline of 60p a week on average over the second half of 1980–81.
I have announced today a reappraisal which reflects our assessment of national economic and housing priorities. This is a necessary response to a situation in which the scale of housing subsidies increased under the previous Government to levels far beyond those the nation could afford.
From now on, we shall concentrate resources where they are needed. I have today set out realistically what the nation can afford.
Mr. Hattersley: The Secretary of State has made a long statement. Many of the figures in the statement are presented in such a way that it is difficult to determine the right hon. Gentleman's real intention. They are all embraced in a rather anodyne statement that he proposes to reassess the situation. I therefore confine myself to a number of questions relating to fact in the hope and belief that the Government will think it right that we should debate this important statement in their time in the immediate future.
Paragraph 8 in the Secretary of State's statement states that between 1976 and 1980 local authorities reduced their house building programme each year. May we be told in clear terms whether today's statement is intended to ensure that they reduce their house building programme even further, whether the Secretary of State expects that next year new starts will exceed the number of additional families that appear on the waiting list, or whether the statement amounts to a net reduction in the housing stock comparing demand and supply?
More specifically, may we be told whether the reduced number of starts that the statement envisages means that councils will be selling more houses than they are building, or building more houses
670
than they are selling? Does the right hon. Gentleman promise us a net increase or a net decrease in the number of houses in the public sector available for tenants who wish to rent?
Secondly, I refer to paragraph 7, in which the right hon. Gentleman misquotes the Green Paper published by the previous Labour Government. The Green Paper stated that the then Government considered that over a run of years rents should be kept broadly in line with changes in money incomes. Will the right hon. Gentleman confirm or deny figures given to me earlier this afternoon by local authority associations that the housing rent increase that he has announced amounts to 28 per cent. over a year? If it does amount to that percentage, is he suggesting that earnings will increase by that amount over 12 months? If earnings are not expected to increase by that amount over 12 months, what effect on inflation and industrial relations does he expect to result from council house rents increasing by such an enormous amount?
Thirdly, will the right hon. Gentleman confirm that during the nine months in which he has been Secretary of State private tenants have suffered increased rents and reduced security of tenure and owner-occupiers have had to face uniquely high mortgage rates? Council tenants must now face uniquely high increases in their rents. There will be a remarkable inability for new and prospective tenants to obtain the council houses that they seek. What tenant or owner-occupier has benefited from the nine months of Conservative Government? Where were any of these proposals listed in the Conservative Party's election manifesto?
Mr. Heseltine: The right hon. Gentleman perhaps has not realised that in giving one block to local authorities it is a matter for local authorities to decide how they shall use the funds that are available to them. He will realise that all questions concerning what they do with their funds must depend on the individual judgment of the authorities. If he is asking for the trends of local authority new house building from which it would be reasonable to draw certain conclusions, he will want to know that during the last four years of the previous Labour Government, of whom he was a member, the

671
number of new houses built by local authorities fell from 102,000 to 84,000 to 65,000 to 59,000.
Equally in Labour and Conservative local authorities the authorities left to themselves under the regime of the previous Government considerably reduced their level of new house building. I cannot predict any more than the right hon. Gentleman's predecessor could predict what they will decide to do with the priorities that they will now have under the one block system.
The right hon. Gentleman asks me about the level of rent increase that is likely to take place. I think that he is making the mistake of adding £1.50 and 60p in reaching his judgment—whereas the average is 60p, which means a £1.80 guideline. In reaching a judgment on what would be the right level of council house rent guideline to issue, I had to consider a number of options. I could have recommended that rents should increase in line with prices. I could have recommended that they increase in line with earnings, or any combination of the percentages relevant to those approaches. In practice it was the Government's view that we should adopt the approach of the previous Labour Government, namely, that rents should rise broadly in line with earnings. That is what the new guideline achieves.
Mr. Hattersley: As the right hon. Gentleman has chosen not to answer one of my questions, I shall press him on two of them. Surely the Government have some anticipation of how many houses will be built next year. Does the Secretary of State judge that the number of starts next year will be larger or smaller than the total in previous years? Secondly, will he confirm the local authority associations' figure, namely, that an increase of £1.80 will amount to an average increase in rents of 28 per cent.—which is wildly in excess of any forecast increase in earnings for the appropriate period?
Mr. Heseltine: It coincides with the change in earnings since the previous Government announced that that should be the rate of change in council rents. If the right hon. Gentleman is trying to push me on the level of new council house starts—I do not remember his pre-
672
decessor ever making such forecasts—the one thing that is for sure is that there is no reason to suppose that the rate of starts is likely to decrease faster than it has been doing as a trend over recent years.
Mr. Heddle: Does my right hon. Friend agree that the housing investment programme allocation will go further in view of the Government's declared intention to abolish Parker Morris standards and reduce the building cost yardstick in line with the private sector?
Mr. Heseltine: It is necessary for the Parker Morris standards and the cost yardstick techniques to be removed to give to local authorities the flexibility and freedom that they will now enjoy under the one block system.
Mr. du Cann: Has my right hon. Friend taken action in respect of a report of the Public Accounts Committee in a previous Parliament? We pay tribute to the work of housing associations, but is he aware that the report was extremely critical of the financial accountability of certain of the associations and of the Housing Corporation? Will he give the House an assurance that if value for money is the criterion to which he adheres, as he has stated, not a penny of public money will go to the associations unless it is properly accounted for?
Mr. Heseltine: My right hon. Friend will be aware that we have embodied in the Housing Bill certain changes which were necessary as a result of the important report to which he refers. I hope that he will accept my assurance that we are now applying the closest scrutiny to the work of the Housing Corporation with the report in mind.
Mr. Alton: Is the right hon. Gentleman satisfied that HIP is being announced so late during the current financial year? How does he expect local authorities to be able to gear their spending programmes from 1 April on the basis of a 28 per cent. cut?
Secondly, how does the right hon. Gentleman expect greater owner-occupation to be achieved when local authorities will have less money to make available for mortgages during the course of the next financial year? Thirdly, how will he honour the obligation accepted

673
by Conservatives on a previous occasion that they will peg mortgages when they are currently running at 15 per cent.? Finally, what will local authorities do to try to accelerate the improvements that he talks about in his statement when he is reducing the amount of money available for improvement grants?
Mr. Heseltine: The hon. Gentleman must be familiar with the broad economic imperative that if we do not reduce the levels of public expenditure we shall never reduce the level of interest charges and will never reduce the demand in the public sector for money that might otherwise be available for the building societies. He must recognise the totality of the programme to understand the answer to his questions. He asked about the HIP allocation. We have had to consider that in the light of the Government's public expenditure programmes. In an ideal world we should have announced the programme earlier. In the light of the public expenditure difficulties that we inherited, we have had to take the whole issue in one and consider it overall. It was necessary to take time to achieve that.
Mr. Durant: Does my right hon. Friend agree that in the White Paper and consultative document of the previous Government there were references to rents increasing in line with incomes? The Opposition have quoted those documents themselves. The truth is that they failed to carry out that policy when in in office.
Mr. Heseltine: My hon. Friend is totally right. They kept uttering brave words about their intentions on housing, but they failed to live up to any of them.
Mr. Tilley: Is the Secretary of State aware that to talk about housing need being local is not enough? Does he not realise that housing needs are particularly localised in the inner city areas of which my constituency is one? Will the right hon. Gentleman assure us that if the 21 per cent. cut is made the inner city housing programmes will not be cut in the same proportion and that special allowance will be made for them? Otherwise the pretence that the Government are maintaining any sort of programme for the inner cities is totally destroyed.
Mr. Heseltine: The hon. Member will be aware that in the allocation of HIV resources the needs of the individual areas play a significant part in the judgments that we make. There is a range of options open to local authorities in order to make more resources available locally. I refer particularly to the sale of council houses, which will release resources that can then be used for the benefit of the people living in that area.
Mr. W. Benyon: Can my right hon. Friend answer a specific point? Whether within the block allocation or outside it, will the housing authorities be able to underwrite fixed price contracts for sale? In the new town context, that would be extraordinarily valuable.
Mr. Heseltine: I shall look at the detail of my hon. Friend's question, but I very much doubt whether we shall be able to underwrite fixed price contracts in the present economic circumstances. However, I shall be in touch with my hon. Friend on the matter.
Mr. Straw: Is the Secretary of State aware that his announcement demonstrates how apt was the description of him by his hon. Friend the Member for Buckingham (Mr. Benyon) as the "gauleiter of housing" since by his policies he is further destroying any local authority discretion in house building programmes? Can the right hon. Gentleman say what effect his announcement will have on employment in the private sector of the building and construction industry, since he professes to be concerned about it?
Mr. Heseltine: The hon. Member will recall that he was an adviser to the Department of the Environment when the party that he supports was in Government. It is inappropriate for him now to use such harsh language about the changes that I am making since he supported a Government who halved the housing programme after 1974. I understand the anxiety of Labour Members to deny the realities but I remind the House that in 1974–75 the housing capital figure was £4·2 billion. By 1978–79 the figure was down to £2·1 billion. If that is not halving the programme, I do not know what is. Right hon. Members will remember that their capital reductions were at the rate of £500 million a year, every year, over their last four years of

675
office. I am proposing a reduction of £550 million in another year. How, when I do it, it can be regarded as a scandal and when the Labour Government did the same thing for four years consistently it was regarded as a coherent policy I do not understand.
Mr. Major: Does my right hon. Friend agree that the Opposition uproar on behalf of council house tenants would be slightly more acceptable if they did not seek to deny those same tenants the right to buy their own homes? Does he further agree that the alternatives to reductions in public expenditure in sectors such as housing are greater inflation, higher interest rates and less money available for those most in need? Will he invite the Opposition to say how they will fund their social objectives if they believe that we should spend money on each and every sector under the sun?
Mr. Heseltine: I would quarrel only slightly with my hon. Friend's suggestion that we should invite the Opposition to say how they will fund their objectives. There is no purpose in asking them because they will not get the chance to do it. The realities are that council tenants made their convictions absolutely clear about housing policy when they voted for the Conservative Party last year on a far greater scale than ever before.
Mr. Pavitt: The right hon. Gentleman mentioned housing associations in connection with his terrible action in relation to the Housing Corporation. Will he say what effect his announcement will have on the co-operative, mutually-owned housing sector? Is he aware that the GLC has established the Greater London Secondary Housing Association specifically to create mutually-owned co-operative housing societies as distinct from housing associations? Does his announcement mean the end of all those plans?
Mr. Heseltine: I made it clear in my Second Reading speech on the Housing Bill that I wish to give every support to the co-operative housing movement.
Mr. Hill: Is not my hon. Friend aware of the pressure from housing committees over the last few years to get exactly what he has stated today, namely, an allocation on which, at their discretion, they can base their own priorities? My only
676
question on my right hon. Friend's statement concerns building for the disabled and the elderly. I should have thought that there was another category that—at a later time—he might reconsider, namely, single people. I believe that my right hon. Friend will find that on most housing lists single people are the third largest category.
Mr. Heseltine: This is a growing political and social problem, but the purpose of changing to a one-block system is to give local authorities the flexibility to deal with their own local needs as they determine them.
Mr. Douglas-Mann: Is the Secretary of State able to tell the House why, and on what basis, he has revised the assessment contained in the housing policy review to the effect that new household formations will be at the rate of 120,000 a year in the public sector alone? Is it true that probable building this year will be 45,000 and that a 20 per cent. reduction on that figure will reduce it to about 36,000? Will the right hon. Gentleman confirm that that means that about 85,000 families a year will, as a result of the policies he has just announced, be left without the chance of a new home?
Mr. Heseltine: No one knows more about housing than the hon. Member. He is fully aware that there are 170,000 re-lets in the public sector alone.
Mr. Moate: I congratulate my right hon. Friend on his statement. There will be widespread support for the view that councils should concentrate provision on those in need, the elderly and the handicapped. For the general strategy to succeed, however, is it not vital that we encourage and speed up the sale of council houses, particularly those houses in need of improvement so that new owners can improve them? Can my right hon. Friend confirm that the new block allocation will give greater freedom to councils to increase the amount of mortgage moneys available for that purpose?
Mr. Heseltine: I am grateful to my hon. Friend for that helpful intervention. If local housing authorities feel that the use of funds for mortgage purposes is in the best interests of their communities, the flexibility of the one-block system will enable them to do precisely that. I can

677
assure my hon. Friend that it is the intention of the Government to draw to the attention of the country—particularly public sector tenants—the opportunities afforded them following enactment of the Housing Bill now going through Standing Committee.
Mr. Cohen: I invite the right hon. Gentleman to attend my next surgery so that he may see that about 70 per cent. of the cases brought to me are brought by people whose ambition is to obtain decent rented housing. In Leeds there are 20,000 people on the waiting list wanting to rent houses. How does the Secretary of State think that the policy that he announced today will solve the problem of those people?
Mr. Heseltine: I hope that the hon. Member will draw the attention of his constituents to the provisions for short-hold which are included in the Housing Bill now going through the House. However, before he explains in detail that the Government are reducing the capital allocations to £500 million in the coming year, he might also explain to them that four years ago the Government of which presumably he was a supporter reduced those allocations by £900 million in one year.
Mr. Robert Atkins: Will my right hon. Friend confirm that rent rebates will be available and that he will encourage the greater use of those rebates for those who cannot afford to pay, and also that those rebates should be paid for by those who can afford to pay? Does he recognise the success of the many councils, mostly Tory controlled, that are building houses for sale in the way that Preston has done? The queues there for those houses are so great that the authority has difficulty in dealing with applications. At the front of those queues are many Labour councillors.
Mr. Heseltine: I assure my hon. Friend that the rent rebates and allowances schemes will proceed under the normal rules. I welcome and support the efforts of the councils to which my hon. Friend referred to continue to enhance the build-for-sale proposals that many Conservative councils are operating with success.
Mr. Faulds: Does the Secretary of State not realise that for many, many people in the industrial West Midlands his statement simply means less hope for
678
the homeless and indeed ensures the creation of more homelessness?
Mr. Heseltine: The hon. Gentleman will be aware that in a range of ways—by the release of land, by the repeal of the Community Land Act and by the sale of council houses to tenants—we are providing a greater opportunity for home ownership than has ever been given in recent years. Before the hon. Gentleman takes off for the West Midlands he should remember that in the last four years he supported a Government who reduced the capital allocation for housing by an average £50 million each year.
Mr. Dover: Is my right hon. Friend aware that his statement will be much welcomed in central Lancashire? In order to hasten the development of private housing for owner-occupation in that area rather than rented housing in the new towns will he ensure that that infrastructure is provided?
Mr. Heseltine: I shall do everything that I can in the present economic climate to help with that difficulty. We are organising a greater degree of co-ordination between those who provide the infrastructure and those who build the houses. Much of the responsibility for that lies with other Government departments, and I shall ensure tht they are aware of my hon. Friend's views.
Mr. Soley: What can the Secretary of State offer to housing stress areas, such as that which I represent? Is he aware that that area has to cope with a Conservative-controlled council, a Conservative GLC and a Conservative Government? Is he aware that the number of names on the housing list in that area has doubled in the last 12 months and that there is no hope of an improvement in public or private house building on a significant scale?
Mr. Heseltine: Certainly, the capital allocation has been falling for years and the hon. Member's area will be familiar with the difficult problems brought about by the last Government's policies. Many opportunities will now be available, including the provision of shorthold and the AIMS and homesteading schemes. The Government are encouraging the release of land, a considerable part of which can be used for cheap houses for sale.
Mr. Allen McKay: Does the Secretary of State agree that his words about the elderly and the infirm fall rather peculiarly from his lips? Is he aware that under a full rental system the houses about which he is concerned are paid for by the rents of the council houses that he proposes to sell? Does he realise that many homeless people cannot afford to buy the houses that he says the local authorities should build? Is he aware that the responsibility is falling on the shoulders of the local authorities to rehouse the homeless in homes that they do not have because the Secretary of State has put the final nail in the council house coffin?
Mr. Heseltine: The people to whom the hon. Gentleman refers are broadly protected by the rent allowance and rebate schemes. His fears are groundless. He takes no account of the considerable benefit to local authorities that sell council houses and use part of the receipts to enhance housing provision.
Mr. Dubs: Is the Secretary of State aware that in many inner cities, such as that which I represent, there is a serious housing crisis that will not be helped by the complacency of his housing policly? Is he aware that waiting lists and homelessness are increasing? How can he have the effrontery to suggest that we should tell those people who are waiting for houses that the shorthold provisions will help them? If I were to tell my constituents who are waiting for houses that shorthold is the answer I should be lynched and there would be a by-election.
Mr. Heseltine: If there were a by-election I know who would win it. If the hon. Gentleman really believes what he says I wonder what he said to the same people when he supported a Government who reduced the housing programme at virtually the same rate as that which we are discussing.
Mr. Stoddart: Is the right hon. Gentleman aware that he is a national disaster and that his announcement is a recipe for housing shortage and soaring house prices? Will he confirm that rents in many areas will increase by considerably more than £1·80 a week, because of high interest charges? How will his statement help Swindon borough council to solve
680
its expansion problems on an integrated basis?
Mr. Heseltine: I have just given that authority a degree of flexibility for solving its problems that it has not had before. Nothing has done more to contribute to the decline in the provision of capital for housing than the disastrous policies of the previous Government.
Mr. Greville Janner: The Secretary of State said that he wished to concentrate resources where they were most needed. Does he accept that stress housing areas such as Leicester, with a growing population and over 30,000 on the housing waiting list, need extra resources, especially as the previous Conservative council did not take up the available resources? Does he agree that that is why the buildings did not go up? The Secretary of State says that he wishes to deal with local needs. Will he give special consideration to the needs of stress housing areas?
Mr. Heseltine: The hon. and learned Gentleman referred to local authorities not taking up the available money. In 1978–79 the last Government provided £2,380 million of which the local authorities used £1,718 million. That represents a 28 per cent. shortfall. The local authorities could not afford to use the money because the Government's economic policies made that money too expensive.
Mr. Shersby: When my right hon. Friend considers housing problems in the inner urban areas and elsewhere, will he do everything possible to encourage local authorities to sell houses under the shared purchase scheme? Is he aware that that offers the greatest hope to many young couples who cannot possibly afford a home of their own? Is he further aware that in Hillingdon the fact that the scheme has been a great success means that many young couples on the housing list have no need to rent accommodation from the local authority?
Mr. Heseltine: I have no doubt that a major priority must be to enable those who can afford it to buy homes of their own. I have no doubt that the shared housing purchase schemes. which we are encouraging, will play a significant part in that. The more that we can encourage those who can afford it to provide housing

681
from their own resources, the more money will be available for those in genuine need.
Mr. Lambie: I apologise for intervening on this statement. However, it is disgraceful that when an important announcement is being made about housing, which will affect 65 per cent. of the Scottish people, neither the Secretary of State for Scotland nor any other Scottish Minister is present. The Scottish people will be angry. Why do we receive more and more Government announcements at press conferences instead of on the Floor of the House? Is it possible for you, Mr. Speaker—
Mr. Speaker: Order. The hon. Gentleman knows that I am not responsible for that. I can deal only with statements that are made in the House. The hon. Gentleman must follow up his inquiry through the usual channels.
Mr. Lambie: On a point of order, Mr. Speaker Is it possible for you to arrest the Secretary of State for Scotland?
Mr. Speaker: I shall answer in a moment.
Mr. Foulkes: Is the Secretary of State aware that at least he is brave enough to face the House, whereas the statement applying to Scotland has been made in a written answer? Is that not a contempt of the House? Will the Secretary of State bring his influence to bear on his colleague, the Secretary of State for Scotland, to face us? If not, some action should be taken to bring him here.
Mr. Heseltine: That is not a matter directly for me. I shall certainly ensure that my right hon. Friend the Secretary of State for Scotland is made aware of what has been said. However, he will
682
not be frightened by the questions from the Opposition today.
Mr. Kaufman: Will the right hon. Gentleman give us one factual answer to one simple question? The original allocation for 1979–80 for local authorities was £2,862 million, in 1979–80 outturn prices. The allocation for local authorities for 1980–81, according to the announcement in the Minister's statement, is £2,199 million, at 1980–81 prices. Will he give us the percentage reduction, in real terms, of the £2,862 million in 197980 prices to £2,199 million in 1980–81 prices.
Mr. Heseltine: I should like to help the right hon. Gentleman. The difficulty is that many figures are involved in this exercise. I am not prepared to give them across the Dispatch Box, but if the right hon. Gentleman will give me the detail of his question I shall do my best to give him an answer today.
Mr. Kaufman: Is the right hon. Gentleman aware that when he issued a statement last August he was able, without any difficulty, to give these comparable figures? As he provided such an extraordinary collection of mingled, concealing figures in his statement, would it not have been perfectly open to him to provide these figures if they were not so disgraceful that he deliberately wished to conceal them?
Mr. Heseltine: I hesitate to comment on the fulsome language of the right hon. Gentleman in suggesting that I am deliberately trying to conceal figures from the House. That is far from the case. I hesitate to bandy statistics on such a complicated matter across the Dispatch Box. However, if the right hon Gentleman tables a question I shall be only too glad to do my best to answer it.

SOLOMON ISLANDS, TUVALU AND KIRIBATI (INDEPENDENCE GIFTS)
4.32 p.m.
The Chancellor of the Duchy of Lancaster and Leader of the House of Commons (Mr. Norman St. John-Stevas): I beg to move,
That Mr. Philip Holland and Mr. John Roper have leave of absence to present on behalf of this House a gift of a clock to the National Parliament of Solomon Islands and gifts of gavel sets to the Houses of Assembly of Tuvalu and Kiribati.
The House—[Interruption.]
Mr. Speaker: Order. I have never before received such distinguished help. I am deeply grateful.
Mr. St. John-Stevas: I wish that the occasion of providing the distinguished help had been equally distinguished.
The House will recall that on 30 January it approved the presentation of independence gifts to Solomon Islands, Tuvalu and Kiribati. The motion today, if approved, will give leave of absence to a small delegation to present the gifts on our behalf. The House may wish to know that the composition of the delegation has been arranged with you, Mr. Speaker, and that it will be accompanied by Mr. Willcox, a Clerk of this House.
Question put and agreed to.

AIRPORTS POLICY
4.34 p.m.
The Secretary of State for Trade (Mr. John Nott): I beg to move,
That this House takes note of the Government's airports policy.
When the present Government came into office last May, they faced the unenviable consequences of what I described in my statement on 17 December as
"Years of indecision, decision and counter-decision"—[Official Report, 17 December 1979; Vol. 976, c. 37.]
on airports policy. In their White Paper on this subject, our predecessors set out a number of proposals designed to meet the short-term demand for air traffic in South-East England. But, reasonable as the White Paper might have appeared at the time—and I want to make it quite clear that I think it was reasonable—it explicitly did not attempt to deal with the central problem of whether there needed to be new airport capacity in South-East England to meet the longer-term demand—and, if so, where is should be situated.
The previous Government established two groups of experts to examine the problem, leaving the decision to their successors. In November last year the Advisory Committee on Airports Policy and the Study Group on South-East Airports reported to me setting out, without a specific recommendation, the advantages and disadvantages of a number of sites and also their forecasts of the expected growth in air traffic up until the end of this century.
I assure my right hon. and hon. Friends and right hon. and hon. Gentlemen, particularly those representing the counties of Hertfordshire, Essex, Suffolk and surrounding counties, including Cambridge, that I would willingly have passed the responsibility of choice to another Department or arrived at a decision which was environmentally impeccable. That would effectively have meant, I fear, doing nothing at all. That is one of the options which I shall explore in my speech. There was the option that we should have done nothing at all.
I am reminded, in this context, of the minister of the Church, not of the Crown, of whom it was said that he had heavenly attitudes but he was no earthly

685
good. I can think of a whole wadge of heavenly decisions in this area which are, in fact and in practice, I fear, no earthly good. But, given that a realistic decision was essential, there are two sentiments of a personal nature which I should like to emphasise at the start. First, I was not particularly influenced by my Department's officials—because I realised that this was ultimately a matter of political judgment.
Secondly, I am perfectly prepared to admit that I began my consideration of the issues with a strong bias, which I still retain, against the disruption of a part of rural England, and when the NFU and other bodies write to me about the utilisation of grade two agricultural land I can understand the passionate emotions which this issue causes, not least because I have a little grade two agricultural land of my own.
But ultimately even a passionate belief in rural England does not avoid the exercise by the Government of choice, and realistic choice at that. I envy the certainty of those who, for instance, direct the affairs of the Council for the Preservation of Rural England—I single it out for special recognition—but it does not have to make harsh political and economic choices. So the first and most obvious question which I asked myself when faced with this dilemma was "Do we need a new airport in South-East England at all? Are the traffic forecasts wrong? And, even if they are right, should we ignore them altogether and allow traffic to be diverted to the Continent, and, equally importantly for this particular debate, is there any realistic way whereby the demand could be diverted or forced into the regions?"
It is worth recalling that in 1960 fewer than 7 million passengers used the London area airports in a single year: that was only 20 years ago. By 1970 the number had grown to over 20 million, and in 1980 the figure will be 40 million or thereabouts.
To give some idea of the uncertainties for the future, the Roskill Commission in 1970 estimated demand in the London area for 1990 at about 120 million passengers a year. En 1975 the airport strategy for Great Britain, in the immediate aftermath of the oil crisis, took a bracket between 67 million and 107 million passengers a year. The Labour Gov-
686
ernment's White Paper of 1978 took a figure of 66 million to 89 million passengers, and the current forecast talks in terms of a low point of 69 million passengers by 1990 with a top figure of 81 million.
When I saw those forecasts, and given that present capacity at Heathrow, Gatwick, Stansted and Luton now amounts to approximately 50 million passengers a year, I can assure the House that I did my very best to discount the figures to the maximum—I am talking of the forecasts—but, even with the pessimistic assumptions that we took about the changes in the price and supply of oil, the likely growth of income here and abroad and the competitiveness of the United Kingdom in world tourist markets, it was clear that the demand—I emphasise, the demand—in the London area by 1990, in spite of all the uncertainties, looks set to be well in excess of capacity on present plans.
Just as we would be rightly criticised if we failed to make provision for the expected growth in demand in the late 1980s, equally, on the other hand, we should be guilty if we entered into a commitment now which might in the end provide massive extra capacity which would not in the end be required.
Before I come to the question of whether it would be possible to respond to this demand solely by the development of regional airports, I must tell the House that I seriously contemplated the option of simply failing to provide capacity in the South-East region at all. I shall conic to the question of regional airports in a moment. If, of course, the demand increased beyond capacity, as we expect, such a choice would have involved increasing chaos in the London area airports which would make the present peak-time squalor at Heathrow airport the norm for all the London area airports throughout the year. Within a period of time, however, traffic would undoubtedly be diverted to Schipol and Charles de Gaulle and other Continental airports, with a consequent loss of business to the United Kingdom.
At this juncture I asked myself whether this was a choice the Government could contemplate. It certainly was an option that we should just refuse to meet the demand. I was confronted with the following facts. Our aviation

687
industry happens to be one of our true growth sectors. Over 180,000 people, directly or indirectly, are employed in the aviation industry. It contributes £300 million to the balance of payments and, since the oil embargo in 1973, British-owned airlines have increased their output in real terms by 9 per cent. per annum. In spite of every prediction to the contrary, traffic has increased by 7 per cent. per annum. The whole pattern of increase has gone quite differently from that predicted in the immediate aftermath of the oil crisis of 1973–74.
Our airlines have been world innovators. Here we are, a nation with a greater proportion of our total income earned overseas than any other major trading nation in the world, with more than 15 per cent. of our total trade in goods now going through the London area airports. We are talking not just of passengers but of 15 per cent. of our total trade. Could we really neglect the needs of one of our growth industries at a time like this?
It is a question not simply of the demands of our tourist industry, although many would say that this is already imposing intolerable peak demands on the South-East, but rather that, if we were to limit the demand, quite apart from the congestion, chaos and delay that would build up at our existing airports, we would be placing yet another major impediment in the path of this country's economic recovery. We would also, in my view, be denying what I see as the fundamental democratic right of the people of this country to travel abroad for business or for pleasure, and to do so with the minimum of delay and inconvenience.
Having eliminated in my own mind—but not perhaps in the minds of all my hon. Friends; I accept that—the choice of failing to act altogether, the next decision concerned the use of regional airports. It is the Government's policy—
Dr. Alan Glyn: I have listened with very great care to the evidence of the considerable thought my right hon. Friend has given to this matter and I am very interested in what he said about the congestion and delay at Heathrow. I entirely accept this. Nevertheless, with a terminal 4 and
688
a possible terminal 5 we shall be faced with almost impossible traffic demands. Will my right hon. Friend consider that those who live under the flight path should be entitled to some form of double glazing and that the whole of his policy on this subject should be altered to conform with the new pattern he is now laying down?
Mr. Nott: I shall deal in a moment with the question of whether we should have considered a terminal 5 at Heathrow and the problems of the Perry Oaks site. As for terminal 4, as my hon. Friend realises, the inspector has made recommendations and we have accepted his report. I shall cover this later, if I may, because I am going to touch on the existing congestion of the roads and the general environment in the area of Heathrow.
As far as double glazing is concerned, my hon. Friend the Under-Secretary made a statement on insulation and matters of this kind a week or two ago, and he will provide further information to the House on insulation, if required, in his winding-up speech.
Mr. Nicholas Baker: On a point of order, Mr. Speaker. Although I have listened to what my right hon. Friend the Minister has to say, it seems to me that the choice is not between doing nothing at all, thus allowing demand to increase, with the resulting chaos, and providing for the demand. The choice is surely between providing for the demand and limiting the number of flights coming in to Heathrow and the other overcrowded airports.
Mr. Nott: If my hon. Friend will forgive me, I shall spend the rest of my speech dealing with all the options, and I have only just begun. As I was saying having eliminated the choice of failing to act altogether, the next decision concerned the use of regional airports. It is the Government's policy to encourage the fullest possible use of our provincial airports, but we cannot escape the fact that about three-quarters of the passengers using London airports start or end their journeys in the South-East.
Some people question the accuracy of this figure, but I assure the House that it is a statistic which has been confirmed by successive surveys of the origins and destinations of passengers. For a very high proportion of travellers, London is

689
the local airport, and they want to use it.
In the Government's view, it would be wrong to attempt to direct such passengers to catch their flight at a remote airport or force foreign visitors to fly to Cardiff or Liverpool or Manchester when they want to come to London. I do not think we should try to right the economic or the environmental balance by forcing people to travel hundreds of miles by road or rail in order to use an airport in a high unemployment area or perhaps to cause less noise in London and more noise elsewhere. It would make nonsense of air transport, waste scarce energy resources in the process, and negate the very arguments put forward by the proponents of regional airports to the effect that people should not have to travel to London from the regions every time they want to fly to a destination abroad.
If the logic applies that way round, it also applies to those who live in the South-East. If there is no reason why people should have to travel from the North to Gatwick to go on a charter holiday to Spain, why should we force people living in Surrey to travel to Manchester for their holiday somewhere else?
Mr. Stanley Newens: Will the Minister give way?
Mr. Nott: I shall, of course, but I must point out to the hon. Gentleman that I shall, I hope, cover most of the points that interest him.
Mr. Newens: I am grateful to the Minister. Is it more reasonable to subject to these conditions all the people who live in the areas in which the huge development is to take place, should his policy go ahead, than to force people who are flying in to this country and who are not intending to stay here to use other airports? Should we force the people who live here to put up with these conditions?
Mr. Nott: That is, of course, the burden of my speech. If the hon. Member will bear with me a little, he will find that we are coming to the central issue that we are debating here. If I can go on a little, I might partly answer his question.
Moreover, even if we took mandatory action and forced airlines and people to go where they do not want to go, the immediate result would be strong
690
retaliation against our airlines in other countries. If Parliament only knew the problems which we face in trying to persuade, cajole and coerce some foreign airlines into Gatwick, they would understand the likely reaction of foreign Governments if we were to extend our present policy of relieving pressure on Heathrow by saying, "Sorry, London and the South-East are out of bounds."
Whatever the wider social or economic purposes, perhaps to generate employment, to reinforce a local authority's regional plans, to help with the industrial problems of a particular region or perhaps because we know, and the foreigners do not, that the Lake District, the Scottish Highlands and the Welsh valleys are very attractive places, none of these arguments carries weight with foreign Governments when they come to provide us with landing rights in the cities and destinations which our passengers seek to visit abroad.
We must distinguish between trying to force people from the South-East to fly from a regional airport and a policy of providing appropriate facilities to enable passengers in the regions to fly from their local airport if they wish to do so. We reject the former as a policy because we consider that it is likely to be counter-productive. If we were to attempt to handle all future growth of traffic outside the London airport system, the present surplus capacity of the regional airports would suffice for perhaps no more than a year or so from now.
Hon. Members may wish to note that, in order to accommodate all further growth in air traffic in the regions, it would be necessary to build the equivalent of two new Birmingham airports every year. I suggest that the consequences of such a step would be considerably more damaging environmentally than would the proposals I am putting forward. To restrict growth in London would simply suppress traffic or divert it to Continental airports, with dire long-term consequences for our trade and the convenience of the British travelling public.
I have no hesitation whatsoever in making a prime objective the shifting of as much of the burden as possible away from the London area, thereby maximising the potential of the regional airports for passengers in their own catchment areas. Before I finally leave this subject may I

691
comment on existing regional airport capacity?
On 17 December I said that my Department would look with particular favour upon proposals for the expansion of capacity to meet demand at regional airports such as East Midlands, Birmingham and Manchester. My Department has negotiated more than 1,500 routes between foreign destinations and our provincial airports, of which only 100 are at present being operated. We want to get more traffic into East Midlands, Birmingham and Manchester, the gateway airports, and also into the smaller airports. I mention these three main airports because they appear to be the best placed to provide some relief to the London airport system and because, if we were to make it profitable for airlines to operate new services to the regions, there must be some concentration of traffic at the major regional airports.
I do not rule out expansion at smaller regional airports elsewhere, when it can be justified. Only last week my Department sanctioned a major scheme for the expansion of the terminal and other facilities at Newcastle airport. We have to make sure, however, that we do not sanction the over-provision of capacity at any airport. Experience has shown that spare capacity is an expensive luxury and that it does not of itself generate more demand or attract more traffic.
So we have to bear two things in mind: first, that in the next few years public expenditure will be restricted and local authorities will have difficult choices to make between expanding their airport and spending their funds on more essential services. Secondly, even assuming that there is sufficient provision within the expenditure ceilings to allow important projects to go ahead, we shall need to be convinced that the proposed developments are reasonable and necessary to meet the demand and that the investment will earn an appropriate return.
Mr. Arthur Palmer: The Minister referred to the Midlands and mentioned Newcastle in passing. I hope that he will not entirely neglect the South-West and Bristol, particularly as he is a West Country Member of Parliament.
Mr. Nott: Bristol is a long way from the part of the West Country that I represent. Dover is rather closer to Bristol airport than is my constituency. I take the point. We certainly will not neglect the attractive West Country airport at Bristol, nor the Welsh airport at Cardiff. I hope the House will forgive me if I do not answer questions from hon. Members about their particular airports; otherwise. I shall be delayed—
Mr. Iain Mills: My right hon. Friend mentioned Birmingham airport, which lies in my constituency. Will he confirm that the statement he has just made does not mean further inflation of passenger traffic at Birmingham airport beyond that envisaged in the expansion which is still at the planning inquiry stage, on which the inspector has not yet judged and the Secretary of State for the Environment has not decided?
Mr. Nott: As my hon. Friend says, the question of Birmingham airport is still in the public inquiry stage. It is better that I should say no more about it. I am sorry that I offended a number of people when I made my original statement by indicating that we were open to the possibility of a further expansion of Birmingham. Many hon. Members demanded it; equally, many other hon. Members did not want it. That is the nature of this problem. I accept it, and somehow we will try to get it right both ways, although they are almost mutually impossible and conflicting objectives to achieve at the same time.
Whilst we will do our utmost to relieve the pressure on the London airports, even with the maximum degree of success the numbers are such that the advisory committee believes that it would not remove the need for additional airport capacity in the South-East by the late 1980s. I have no reason to doubt the committee's conclusion. We must, therefore, provide for the 1990s and beyond, but on an incremental basis, so that new capacity becomes available as the demand grows.
I believe that the House would rather I concentrated for the remaining part of my speech on the choice of Stansted as opposed to Maplin or a green field site to meet this incremental demand. I could, of course, spend some time on how we envisage solving the short-term problem of a shortfall of capacity at Heathrow

693
and the shift of traffic to Gatwick, but the Government's policies in this area are fairly well known, if not always welcome.
Before leaving Heathrow and Gatwick, however, I want to comment on two features of importance. When we first looked at the future long-term demand for airport capacity in the South-East, I was much tempted by the possibility of the Perry Oaks site at Heathrow and the building of a fifth terminal at that location. That is the preferred choice of British Airways. Although 1½ million people live within the same noise contours that will affect 17,000 people at Stansted, I was conscious of the fact that the advantage of Heathrow is simply that an airport exists at that location already.
The further that I looked at it, however, quite apart from the added burdens on 1½ million people in the Heathrow area who, incidentally, are just as concerned about their environment as are those who live in Essex, it became clear that the burden on road and rail facilities at Heathrow of the efficient operation of an airport confined to a relatively small acreage would become intolerable. We would be attempting to expand capacity to over 50 million passengers per annum on a very restricted site. But it was not simply the burden upon the environment and upon the transport services in what is already one of the most congested major airports in the world. It was also that the lead time in moving the sewage disposal works from Perry Oaks was such that a fifth terminal at Heathrow would simply come too late even if we thought it was desirable, which I do not for environmental reasons. I was forced to accept the advice of the inspector who conducted the inquiry into the fourth terminal that a fifth terminal at Heathrow should not be pursued.
As with Heathrow, I visited Gatwick and studied the perimeter of Gatwick from the air—
Sir Anthony Royle: I very much welcome the decision on the fifth terminal at Heathrow. Is my right hon. Friend aware that, in direct contravention of the Minister's decision, British Airways is carrying out a campaign still to keep terminal 5 as a possible option? Will he please consider speaking to the chairman of British Airways about his decision and suggesting
694
that British Airways should stop its campaign for a fifth terminal at Heathrow?
Mr. Nott: I have, of course, some authority over the chairman of British Airways, in that I appoint him. However, British Airways must be entitled to pursue its own choice of site, at least until the public inquiry has been held and has reported. The public inquiry into a new terminal building at Stansted will consider the matter on the widest possible basis, and many people who live in the Essex area will probably want to represent the case for a fifth terminal at Heathrow as an option. It is right that they should be allowed to do so. I have made clear the Government's position. We do not favour a fifth terminal, and that is also the view of the inspector.
Mr. David Mellor:: If the inspector decides against the Stansted option, we come back to a fifth terminal at Heathrow. Surely it is an abdication of ministerial responsibility to leave the final decison of Government policy to an inspector.
Mr. Nott: I did not say that the final decision rested with the inspector. The normal procedures will be followed. The public inquiry will take place, and it will make its recommendations to Ministers and, as has always been the case, Ministers will make the final decision. We do not want to take that final decision until the wide-ranging public inquiry into the Stansted proposal has been completed.
As with Heathrow, I visited Gatwick and studied the perimeter from the air. It seemed illogical to build three London area airports when two would suffice, and, in pure logic, a second runway at Gatwick had to be a serious subject for major study. As a result of decisions taken by our predecessors, the line of the relatively short auxiliary runway originally proposed at Gatwick has been abandoned and built over. A second runway, capable of independent parallel operations, would therefore have to built on a new location, some 2·4 km north of the present airport and staggered to avoid cutting across the A23 and the main railway line.
That would involve the destruction of the village of Charlwood and the other smaller settlements within the 2,000 or so acres of agricultural and residential

695
land which would be required. The costs of construction would be very high, the lead times would be longer than those of Stansted and the environmental impact would be very serious. Overall, it would, not provide a flexible solution if demand continued to grow. For all these reasons, we decided that it should not be pursued.
Mr. Clinton Davis: The Minister referred to the second runway option as having been abandoned by his predecessors. It was under the Conservative Government, in the light of their decision to develop Maplin, that that happened. However, I agree that that option is no longer viable.
Mr. Nott: I hope that my remark did not sound like a partisan comment. For whatever reason, it has been abandoned. I do not consider that the undertaking of the BAA should be binding on the Government. We considered the possibility of a second runway at Gatwick very seriously before we arrived at our decision. We turned down that option.
Mr. Tim Renton (Mid-Sussex): Without wishing in any way to shake the solidity of Sussex Members, if my right hon. Friend has so firmly abandoned the option of a second runway at Gatwick surely that will affect the course of the inquiry into the second terminal which is now proceeding. How can one runway handle the 25 million passengers that two terminuses could take?
Mr. Nott: We accept that at present the single runway at Gatwick probably would not take 25 million passengers. If the average load of the aircraft using Gatwick were to be increased, so that there were more jumbos relative to Cessnas or whatever, my hon. Friend will appreciate that that would make a dramatic difference to the number of people that a single runway could take. I illustrated the simple mathematical fact with a graphic choice of aircraft.
I turn next to the most controversial aspect of our policy—the choice of the existing airport at Stansted as the site to take the longer-term growth in traffic after Heathrow and Gatwick have reached their proposed limit of four and two terminals respectively. Like some of my hen. Friends, I can dream dreams, and
696
certainly I can understand the dream of a new coastal airport at Maplin or at some other site, despite the harsh reality that there is an existing airport at Stansted which is under-utilised.
Why did we choose Stansted? I have to tell the House that it really chose itself. However hard I may have fought in my own mind against building around the existing runway at Stansted in order to avoid changing this attractive part of rural Essex, there really seemed no other realistic option. Time has moved on from the circumstances that surrounded the original choice of Maplin and its cancellation by the previous Government.
I must make it clear that the Government will reach their final decision only in the light of the inspector's recommendation. In 1980 I can simply set out clearly the constraints which surround our choice of action and then provide through this wide-ranging public inquiry the opportunity for the widest expression of views. The final decision must come at the end of that process.
But I must make my own opinion absolutely clear. There is, in my view, not the remotest possibility of any Government ever resurrecting the Maplin project. Nor do I think that it is any longer realistic to consider a total green field site. Of course, I have looked at other offshore options, not least Severnside, which at one time seemed a viable choice. But in the Government's judgment—it can be nothing more than that—the rejection by Parliament of our proposal would mean that there would be no way of providing additional capacity to meet the demand envisaged in the longer term, leading to consequences for this country which I have earlier described.
Why did we eliminate the choice of Maplin so emphatically? I acknowledge, of course, that Maplin might have been the best site for a massive four-runway airport if the traffic had developed as was expected in the early 1970s. The huge expenditure and the environmental damage caused at Maplin could in that case conceivably have been justified, although it would have been hotly disputed.
But at present we do not even know for sure whether a two-runway airport will be essential. If the forecasts are to be believed, it looks likely, but it is by no

697
means certain, and surely no one could conceive of Maplin as a site for a single-runway, single terminal at present.
I am told that a two-lane highway is essential from the eastern seaboard—Southend—into London and, therefore, provision of some 65 kilometres of motorway. Incidentally, 65 kilometres of motorway would take up approximately 1,000 acres of good Essex land—at a cost of about £95 million, and direct rail access would cost around £160 million. They are essential requirements for Maplin, regardless of the airport. I do not rule out the fact that one day some Government will make provisions for communications of such a kind, but to try in association with the building of a major airport to drive a new motorway through this length of Essex is simply unrealistic.
In any event, where would the defence establishments go? I was as sceptical as anyone else about the defence establishments. No one has made any practical suggestions as to where alternative sites can be found for the facilities, and few have considered the environmental implications in other parts of the country of relocation. I should emphasise that there are four defence establishments at Shoeburyness and all are essential to the defence of the country.
The Roskill Commission assumed that the firing ranges would be moved fairiy quickly, but a public inquiry in Wales in 1971, after the report, rejected the proposal for the relocation of defence firing ranges at Pembrey Sands, and no new site was found before the Maplin project collapsed. Indeed, in 1973 the Nugent committee looked at the problem and found that there was great difficulty in finding any alternative site.
Since then the difficulties have only increased, and finding a site for the Shoeburyness firing ranges could be almost as difficult as finding a green field site for an airport. Even if we were to assume that alternative sites could be found and we were greatly to discount the time that the present public inquiry procedures actually take and discount again the time given to us by the experts for relocation, and then, at the end of it, the time taken to build a new runway on reclaimed land, we should still be talking of a time scale wholly out of phase with the urgent
698
need to provide additional capacity before the end of the decade.
So if, by the process of elimination, Maplin seems impossible on the time scale—and I have not here laid particular stress on the cost, although the cost would be up to £1 billion, which would make it difficult at present, or the environmental costs of disrupting a coastal site of, some would say, great ecological importance—it has to be eliminated.
Where else was it possible to go? All of the green field sites have substantial overall disadvantages over the use of the existing single runway at Stansted airport. So I come to this question. First, the requirement of land for the first stages of development is small in comparison with other sites, since the airport already occupies nearly 1,000 acres. The existing runway already has the capacity for handling up to 25 million passengers a year, if additional terminal capacity were to be provided. The environmental disruption and the financial cost of providing additional road and rail access in the case of Stansted are relatively modest.
Of course, in the first stage it requires the acquisition of a further 1,500 acres. So far as the loss of agricultural land is concerned, it would require less land acquisition than the other choices. Stansted would be largely grade 2 land, whilst at Maplin some of the land would be grade 1 and other land grade 2. An airport at Maplin would, of course, as I have said, involve the loss of several thousand acres of agricultural land in providing a rail and motorway link across south Essex, as well as the agricultural land that would be required in other parts of the country to relocate the Ministry of Defence facitities displaced from Shoeburyness—and none of us knows where on earth they could go anyhow.
Secondly, if the Government accept the argument that the demand for air traffic has to be met rather than avoided, and if, at the same time, they take a realistic and thoroughly cautious view about the forecasts, Stansted provides the only viable choice with regard to flexibility on timing. Not only is it the only site which, with the neglect of a decision for the past decade, can conceivably meet the demand up to 1990; it also provides the only realistic option for meeting the demand of air traffic as it develops. Given the uncertainties in traffic forecasting, Stansted simply

699
is the obvious way of meeting incremental demand.
Of course, I recognise the concern—and it must be very deep indeed—that many feel that, once Stansted is chosen for development, the surrounding area will inexorably be turned into a concrete jungle. The local authority representatives on the study group made broad estimates of the urbanisation implications, which have been widely quoted.
I want to draw the attention of the House to the parallel report of the Advisory Committee on Airports Policy, which includes representatives of trade unions, local authorities, the airlines and others. That committee noted doubts about the implications of putting into effect the full details of the urbanisation suggestions made in the study group's report. There is a suggestion that the urbanisation aspects have been exaggerated. For example, there is room for doubt about the assumptions in the South-East study group report about the extent of reverse commuting from London, which, in my view, may well be significant, since Stansted is only 34 miles from London and no less well placed than Maplin to draw labour from London.
All forecasts of urbanisation are subject to many uncertainties. I am not in a position to judge the accuracy of the forecasts which have been prepared, but it may be that the slower growth of Stansted, which is now expected, could significantly affect the prospects of local recruitment and the need for new housing.
These issues are likely to be raised at the public inquiry, and I have no doubt that they will be carefully examined. I think that it is right that, in making any judgments or comparisons, we should approach the question with great caution, bearing in mind the very different views that have been expressed. We should also bear in mind that, if the traffic eventually justifies expansion to a two-runway airport, the BAA would consider providing facilities within the airport boundaries for ancillary services, which is not the case at present at Heathrow. That would, at least, limit development outside the airport.
Mr. R. A. McCrindle: With regard to the uncertainty that surrounds the possible need for a
700
development in the second stage, does my right hon. Friend understand that many of us who are persuaded by the logic of his argument in regard to expanding Stansted in the first instance wonder why he appears to have taken such a clear-cut decision in regard to the second stage at Stansted? At the same time, he appears to be completely dismissing the possibility that terminal No. 5 on the Perry Oaks site might turn out to be, with the improved communications and improved environmental aspects, a better starter than the second stage at Stansted.
Mr. Nott: With respect to my hon. Friend, I cannot go back on the Perry Oaks site now. Our estimate it that it would take 12 years to deal with that site. We should have to find somewhere else for the sewage works. We do not know where they would go. I shall be delighted to return to the matter when I have time. However, I have already been speaking for 40 minutes and still have a few points to cover.
I shall come in a moment to my hon. Friend's point about the further area of land at Stansted.
I turn now to a matter of considerable interest to those living in the neighbourhood of Stansted—the procedures for examining the proposals for the expansion of Stansted, the scope of the public inquiry and the provisions for blight.
Our present thinking is that the proposals could be examined satisfactorily under the normal planning procedures. The British Airports Authority would apply to the local planning authority for permission to construct a new terminal and associated developments and would submit compulsory purchase orders for the 1,500 acres required for the first stage. At the same time—and this answers my hon. Friend's point—it would define and apply for the safeguarding from incompatible development of an additional 2,500 acres for any further expansion that might be needed in the longer term. The planning applications would be called in for decision, following a public inquiry.
We do not envisage that the additional 2,500 acres would be the subject of a planning application at this stage. It

701
would be premature to discuss an application for a development that is not likely to be needed for a long time, if at all. We envisage however, that the BAA would produce for the inquiry an outline plan of what it likely to be involved in the additional 2,500 acres. Its purpose would he to indicate what might happen at a later date, if the initial application were approved and the need for a further expansion did in fact materialise.
We intend the public inquiry to be wide-ranging and to give objectors an opportunity not only to expand on their objections to the Stansted proposal but also to question the need for a major airport expansion anywhere and to put forward alternative sites. We would appoint an independent inspector and assessors. He will be able to take into account any evidence that he considers relevant to whether the development at Stansted should be permitted. Normally, any of the parties can seek to submit evidence and views on a suggested alternative. So long as these were relevant to the inspector's consideration of the proposals before him, no doubt he would regard them as admissible.
The question of objectors' costs has been raised. This Government have adopted the policy followed by successive Governments, based on the main recommendations made by the Council on Tribunals in its 1964 report on the award of costs at statutory inquiries. Although we recognise that the development of Stansted has aroused a great deal of interest, we do not see any reason for deviating from the existing policy, considered by the Council of Tribunals and set out at that time.
I conclude by saying that when I made my statement on 17 December I mentioned that the Government intended that owner-occupiers of residential and agricultural properties on both the land needed for the first phase of development and the wider areas—that is, the 2,500 acres that would be safeguarded—should have the opportunity to sell their property at an unblighted value to the BAA. Statutory blight provisions will be triggered off for the 1,500 acres of land required for the first phase by the publication of the compulsory purchase orders at about the same time as the application for plan-
702
ping permission is submitted, and that will be done later this year.
These would not, however, apply to the additional 2,500 acres, and special arrangements will be needed to protect this further area from incompatible developments and to enable people to sell their properties at an unblighted value in this wider area as soon as practicable. There is more than one way of achieving these ends and we have not yet reached a final view on what is likely to be, on the whole, the best method. But the objective is one that is not in doubt and on which. I think, all hon. Members will in principle be in agreement.
There is no more difficult area for public policy than airports. I am not so foolish as to believe that anyone can be satisfied with airports policy, except, of course, those whose areas have been reprieved. But the Government have a public duty and responsibility to look into the future and to take the harsh decisions which that future dictates.
I believe that our policy achieves the objectives with as little environmental cost as possible and with the minimum of financial burden. But the final decision must await the public inquiry, at which we are determined that those affected should be given the fullest opportunity to have their say.
5.21 pm
Mr. John Smith: I am sure that the House will be grateful to the Secretary of State for having taken some time to explain his decision. In my opinion, he was quite right to do so. This debate gives us all a useful opportunity to consider the statement that was made by the Government before the Christmas Recess. We have also had the opportunity since then to study the two reports to which the Secretary of State referred—the reports of the Advisory Committee on Airports Policy and of the Study Group on South-East Airports, both of which provided useful information as a background to the policy that the Secretary of State has announced.
I should like to touch on one or two other items of airports policy, in particular the landing charges that are proposed by the British Airports Authority and the Civil Aviation Authority, as we may not have an opportunity to discuss

703
airports policy for a whole day for some time to come.
In the statement by the Secretary of of State on 17 December, he introduced his proposals by disclaiming any intention to build a major new international airport such as was considered by the Roskill Commission. There are clearly important differences between the four-runway concept contained in the Roskill report and the phased developments that are proposed for Stansted. But the developments at Stansted, if they proceed to their full extent through the three stages, amount to a capacity of 50 million passengers operating from two runways. On any view, that constitutes a major new international airport.
After all, the present traffic at Heathrow is under 30 million passengers a year, and even a development to the second stage at Stansted envisages 25 million passengers a year, which is not far short of the existing use of Heathrow. I conclude, therefore, that if the development of Stansted proceeds to its ultimate conclusion—I fully appreciate that it would do so only if demand warranted it on present proposals—we are talking about a major airport development.
In his statement the Secretary of State also prefaced his proposals for Stansted with a declaration of his desire to see the fullest possible expansion of airports in other parts of the country. That is something with which I believe the whole House will agree. The most difficult aspect of airports policy planning is the concentration of air traffic movements in the South-East of England. I think that there is a bitter irony in the fact that what the communities in South-East England—well represented in the House this afternoon—which will be affected by the Stansted proposals, or which might be affected by alternative sites, are complaining about is what they often call industrialisation. They are areas for the most part of full employment in an attractive environment and they do not seek the economic activity that airport development will inevitably promote.
Unfortunately, there are other parts of the country—development areas in particular—that passionately desire the impetus of economic activity and secure employment that an airport development would bring. In such areas there would
704
no doubt be proper concern for the environment. But there would equally be a strong body—especially in areas of high and growing unemployment—as our industrial crisis deepens, which would clamour for the job opportunities and economic impulse that new airports would provide. This phenomenon underlines one of the most unfortunate features of our economic and political landscape—the over-concentration of economic activity and also political power in the south-east corner of England, something that is unfortunately becoming worse rather than better with the collapse of a determined regional development policy.
It is considerations such as these that prompt the desire to spread our air traffic load more evenly throughout the nation. We have listened with interest to the desire of the Government to develop regional airports. I have no doubt that my right hon. and hon. Friends and other hon. Members will make out a case for their own individual airport developments.
I must confess, however, that I had the impression on 17 December that the Secretary of State was emphasising regional airport development policy to some extent for presentational reasons. His statement was a little deficient in terms of what would be put behind a regional airports development strategy. He referred to the negotiation for new air traffic rights. As he said today, a large number of air traffic rights have been negotiated over the years. The problem is not so much obtaining new air traffic rights as getting the existing ones taken up and used by airlines. So there is not much possibility of strengthening the strategy on that front.
The Secretary of State also referred to the policies that the Government are promoting in the Civil Aviation Bill. As he himself knows, one of the cardinal principles of the Civil Aviation Bill as regards air traffic licensing is that the Government are removing themselves from the scene and eschewing the power to lay down ministerial policy to be followed by the CAA.
The only reference that I see in the Civil Aviation Bill is a requirement on the CAA
"to secure the most effective use of airports within the United Kingdom."
That could mean a lot or it could mean nothing. A phrase such as that in an

705
Act of Parliament could not amount to a strengthening of policy. Indeed, I think that it is a weakening of policy in that the Secretary of State is giving up the influence that he has to shape air traffic licensing policy.
As the Government have declared their intention on regional airport development, I hope that they will give more consideration to putting real impetus behind it so that we see a Government policy that deliberately stimulates regional airport development.
Mr. Stephen Donal: I am sure that many hon. Members have a lot of sympathy with what the right hon. Member for Lanarkshire, North (Mr. Smith) said about regional airports. But does he accept that air transport is a business and that when we refer to investing in airports or airlines we are talking about a transport undertaking that is there to provide a service and to fulfil a particular demand? There is no point in providing regional airports or regional infrastructure if the demand is not there for the commodity in which one is investing. Surely, the right hon. Gentleman should ernphasise—as my right hon. Friend has done—that we cannot have a meaningful regional airports policy unless we make it clear that it should be within the context of a profit-making air transport industry.
Mr. Smith: Clearly, the realities of the economics must be faced by the airlines and others concerned. It is not easy to support a regional development policy strategy, but it was not I who announced that that was one of the points of the Government's policy—it was the Secretary of State. I am merely asking him what he will do to make that a reality. One thing that is necessary is to have a more effective and vigorous regional economic policy to give backbone to a regional airports strategy.
Interesting questions arise out of the growing emphasis on leisure traffic in air transport movements. Incentives must be considered to attract charter traffic to move from regional airports rather than from London airport as so many of them do at present. There are certain difficulties, and I do not claim to have a plan which will solve the problem. However, as the Secretary of State and the Government have confessed to an
706
interest in developing airports, I should like to know what they will do about it.
It is true, as the Secretary of State said, that for more than a decade successive Governments have grappled with the twin problems, first, of assessing the likely air traffic demand and, secondly, of providing an intelligent and systematic way for that air traffic demand in the South-East. Some people say that we should not try to solve the problem and that we should refuse to suffer any environmental damage by providing new airport capacity. They say that the price is too high and that we should either fail to provide new airport capacity or seek to suppress air traffic demand in the South-East. They say that the economic losses should be borne with equanimity because of the gains to the environment.
I confess that I do not share that view. It was pointed out in the advisory committee's report that the United Kingdom has a prominent role to play in the international air transport industry. That arises partly from the fact that this country is strategically well placed between Europe and North America. Undoubtedly, that is one reason why we have one of the largest airlines in Europe, and an airline that is the largest in the world in terms of international passengers carried. The total operating revenue of United Kingdom airlines in 1978 was nearly £2,000 million. As the Secretary of State said, there was a balance of payments benefit of £350 million. The industry also provides a large number of jobs. One of the reports said that if developments do not proceed in the South-East there might be a job loss of 40,000. I find such estimates difficult to accept because they contain much speculation. However, there is no doubt that there would be an economic loss.
I do not believe that it is right to seek to inhibit an industry which does well and which is essential to the success of the country as an international trading nation. We must face the problem of providing, as best we can, for a demand that assists our economy. The task is to do so in a way that minimises the environmental damage. Inevitably, there will be some environmental damage and the problem is most acute in the South-East.
However, we should be careful about planning too far ahead. If we look at

707
the changes since the Roskill Commission recommended a four-runway airport, we will see that first there has been a steep increase in oil prices. There was an economic revolution in October 1973 when oil prices increased fivefold. The world has still not recovered from that and. I am sorry to say, it looks as if it is not yet in the position to tackle that. That rise led to the continuing rise of oil prices. They have effectively doubled within the last year. That has an important effect on air fares. In the opposite direction to that influence, and complicating it further, has been the development of large wide-bodied aircraft. They carry a great many people and they have introduced, for example, over the North Atlantic, fares which are much lower than anybody could have foreseen. As a result of that, there has been a switch from business to leisure traffic. The split is generally regarded as being two-thirds leisure and one-third business. Most people in the industry believe that in the next decade or so it will move towards 80 per cent. leisure and 20 per cent. business. That will have important effects on what we are considering today.
The problem is becoming less one of air traffic movement and more one of dealing with passengers. It is a move from runways to terminals. That factor is taken account of in the reports but it was unpredictable at the time that the Roskill Commission reported. The people who tackled the problem earnestly at that time cannot be blamed for that.
Mr. John Wells: On the point about the switch from business to passenger movement, the coming of the Channel tunnel, which is more likely every day, will shift about 8 million people in the first year away from the airports. That factor should be borne in mind by my right hon. Friend when he makes his assessment.
Mr. Smith: I understand that the prospect of the Channel tunnel was taken into account by the advisory committee. However, I am not sure that the hon. Gentleman is entitled to be all that certain about it. I confess to a scepticism as to whether it will ever be developed, but I know his enthusiasm for it. I have my doubts when I look at the scale of public and private expenditure that would be
708
involved, and the possibility does not entitle us to ignore the air traffic problem in the South-East.
The result of those conflicting movements—the rise in the price of oil and the wide-bodied aircraft—is that the problem becomes incredibly difficult. The future price of oil is crucial to our estimate of air traffic. The report attempts to make assumptions about future oil prices. As soon as those assumptions are made, they are subject to error and they are qualified by further estimates that are, perhaps, 33 per cent. or 40 per cent. out. The unfortunate and difficult truth is that it is impossible to predict the future price of oil, however systematically and earnestly we go about it. Economic statisticians can produce beautiful graphs, which bear little reference to reality. We all know that the future price of oil is dependent as much on acutely variable international political events as on the laws of economics.
It is impossible to come to a conclusion about future oil prices except to say that they are unlikely to come down. The scale at which they will increase is difficult to forecast. We must face that problem as being one that we cannot determine absolutely. That uncertainty means that we cannot know what the demand will be, and that is a strong argument against the Maplin development. It we develop at Maplin, we shall be committed to a large airport to justify the economic factors involved. I know that the site is favoured by all those who do not want an airport in their constituency. Its effectiveness is enhanced by the fact that it would mean that there would be no airport in their area. No doubt the argument in favour of Maplin will crop up again at the Stansted inquiry. I know that the GLC is interested in it.
To judge from the figures in the report, it appears to be the most expensive development and it is unlikely that any Government will change the decision that was made to scrap the project in 1974. I notice that the Secretary of State laid emphasis on Southend when he referred to Maplin. There are many conflicting difficulties in airport policy, but helping Mr. Teddy Taylor is one that is new to me. I am sorry that Southend has had to take the rubbish that Glasgow recently got rid of in the by-election. [Interruption]. If Conservative Members believe that that

709
is a cheap remark, they have not heard Mr. Teddy Taylor operating in Glasgow. The Secretary of State knows that I make the remark in a light-hearted spirit. Mr. Teddy Taylor will need a great deal more than the blessings of the Secretary of State, as far as the Maplin project is concerned, to hold a seat in Southend.
If we exclude Maplin because the future is so unpredictable, we must accept that there will still be a fairly steady growth in demand. There was a hiccup in 1973–74, but since that time the expansion of air traffic demand has remained on a fairly constant upward curve. The trend is adequate justification for the recently approved fourth terminal at Heathrow airport and for the proposed second terminal at Gatwick, which has still to go through a planning inquiry. The decisions were highlighted in the previous Government's White Paper.
Like the previous Government the present Government do not advocate a fifth terminal at Heathrow on the Perry Oaks site. Some hon. Members have referred to that in the debate. British Airways have advocated the proposal in recent weeks but they have not yet been able to persuade the Government or the British Airports Authority of the wisdom of such an extension. It is unfortunate that there is a dispute on the facts. The Secretary of State and the authority say that the time scale for the development would be 12 years, whereas British Airways say that six years would be feasible.
Both sides quote the Thames Water Authority in a contradictory manner. It is time the facts were sorted out. The most suitable body to do that is the Department of Trade. Somebody should speak for the Thames Water Authority and find out the possibilities for sludge removal, so that a decision can be made on that basis.
Mr. McCrindle: While these facts are being established, does not the right hon. Gentleman agree with my earlier remark that the Government would be well advised, on the second stage of development of airport needs, to keep their options open on the question whether Stansted should be expanded further than has been planned or whether there should be a fifth terminal at Heathrow?
Mr. Smith: I heard the hon. Gentleman's intervention during the Secretary of
710
State's speech. It is more an alternative to a Stansted 2 than a Stansted 1. I appreciate the hon. Gentleman's point. There is some force in his argument. The difficulty is the question of the time scale at Perry Oaks. There are environmental factors involved for those who live in the Heathrow area.
I doubt whether Heathrow could take passengers flooding in from five terminals. The central services might become congested. It is time that the matter was clarified. The Secretary of State said that he had been led to the view that a fifth terminal should not be provided. I do not know who led him to that view.
Mr. Nott: I led myself.
Mr. Smith: The Secretary of State should have said that he led himself to that view. Students of the language of Government might know that that was a less unequivocal statement than saying that he had flatly rejected a fifth terminal at Heathrow. I hope that the Minister will clarify that point when he replies.
The hon. Member for Brentwood and Ongar (Mr. McCrindle) made a valid point. If the public inquiry at Stansted allowed the first stage—up to 15 million passengers—but did not allow any other development—and that must be a possibility—would the fifth terminal be revived? What is the Government's view on that matter at this stage?
One of the advantages of Stansted, as the Secretary of State pointed out, is that it is an existing airport.
Mr. Toby Jessell: Before the right hon. Gentleman leaves the subject of the Perry Oaks site, will he make his view a little clearer, as the Government have said that they will not build a fifth terminal? Will he say whether he accepts that, or is he prepared to inflict further suffering on those living around Heathrow?
Mr. Smith: I wish to help the hon. Gentleman by stating my view. I suspect that there is a slight political motivation in his question. The previous Government's view was made clear in the 1978 White Paper. They did not favour a fifth terminal. I do not favour a fifth terminal, and I believe tht the Government are right to reject it. There appears to be

711
some doubt about the facts upon which the Government's decision was based. On present evidence, there is not a case for a fifth terminal. A new position might arise if Stansted received only limited planning permission.
Stansted has the advantage of being an existing airport. It appears to be the least expensive of all the sites on the list. No doubt that is because there would be less in the way of initial preparations than there would be at a totally new site. As the House knows, the previous Government foresaw development up to 4 million passengers a year at Stansted. Even on a low estimate of traffic demand, a case could be made for its further development.
The study group saw three stages of development—first, up to 15 million passengers a year on the existing runway with a single terminal; secondly, up to 25 million passengers a year with a second runway; finally, an ultimate development for up to 50 million passengers with a second terminal. That would mean two runways and two terminals.
The case for each stage will be put at the public inquiry, which the Secretary of State said would be wide-ranging. It will be for the British Airports Authority to argue its case on each of the stages. There will be an opportunity for the assumptions about air traffic demand to be more vigorously examined than it is possible for us to do in the course of the debate.
The case for the first stge of development may be more easily sustained at the inquiry than the second or third stages, where the uncertainties of prediction become necessarily more acute. No doubt one of the sharp areas of controversy will be on the question how far ahead it is possible to plan in any certain way.
Although it has been claimed that there has been a surfeit of inquiries on the subject, I believe that the Government were right to refer the matter to a public inquiry. That inquiry will take place, presumably, within the next few months. Detailed examination of the requirements of air traffic demand and of environmental implications can be made.
One of the issues that might feature in the inquiry will be the cost of the proposed developments. As I understand it,
712
the British Airports Authority intends to finance the developments out of its own resources. It has little choice in the matter, because it is required to finance the develpoments cut of the charges that it makes and the profits that it derives from the airports system.
We have noticed the steep increases in the landing charges made by both the British Airports Authority and the Civil Aviation Authority for the airports that they operate. There have been increases in fees for security and other services. The BAA is not allowed by the Government to borrow to finance its developments. That means that if it is successful in the planning application for a large development at Stansted and other developments at Heathrow and Gatwick, a large capital programme will be embarked upon.
If it is forced to finance the developments without recourse to borrowing, the air transport users of today will be financing the facilities for the users of tomorrow. Is that either sensible or fair? It is one thing to ask the users of tomorrow to pay for the facilities of tomorrow but it is another to ask the users of today to make a sacrifice for the users of tomorrow.
Mr. Stephen Ross: As I understand the matter, the BAA has£20 million that is locked in by the Government. It is not allowed to spend it. The smaller Stansted scheme will cost about £230 million and the larger developments will cost £700 million. How is that to be financed? We deserve an answer from the Government on that point.
Mr. Smith: I wish that I could answer the hon. Gentleman. It must be left to the Minister to answer that question when he replies. I can say that if Government policy does not change it will have to be financed out of the BAA's own revenue, namely, its charges and profits. It is a fairly profitable organisation, but it is a large capital programme to finance internally. I would like the Government to reconsider their policy on the matter. It does not seem to be a sensible way to proceed.
If charges must rise to pay for the developments, that, allied to fuel price increases, is another twist in the inflationary spiral from which we suffer.

713
When he replies, will the Minister say a few words about the future of Prestwick airport? I raised the matter with the Secretary of State when he made his statement. I understand that there has been further consideration of the matter at meetings between the Secretary of State, the Minister and the BAA. I am sure that the House would be interested to know the outcome of the meetings.
Mr. George Foulkes: Does my right hon. Friend agree that what we want from the Minister is not only an assertion that Prestwick will remain open but an assurance that it will be allowed to develop? With the new Caledonian air motor facility at the airport, the opening of the new air traffic control tower and the electrification of the Paisley to Ayr line, there will be a huge and wonderful potential for the airport to develop. We need a clear indication that the Government foresee an expansion of Prestwick and not only the maintenance of the existing position.
Mr. Smith: I have known for some time that my hon. Friend was a skilful advocate for Prestwick airport. He has demonstrated that again today. There is an essential place for Prestwick in the airport structure of Britain. It is one of the few airports that are guaranteed to be fog-free. It is an important airport for diversions of air traffic in an emergency. It needs to be given some assurances about its future development.
I know that central Scotland's airport position is not ideal. It is said with some justification that there are too many airports. If it had been planned properly from the beginning, there would have been a more sensible airports structure. However, Prestwick has an important role to play.
The motion asks us simply to take note of the Government's policy on airports. I am sure that there are many Conservative Members who are acutely aware of the difference between taking note and supporting the policy of the Government. It may be that there is a certain amount of politics involved in the way in which the motion has been drafted. It crossed my mind momentarily that the way in which it was drafted suggested that there might be just a scintilla of politics.
The Under-Secretary of State for Trade (Mr. Norman Tebbitt): The right hon. Gentleman is being devious.
Mr. Smith: If I am devious, I do not know what the Minister is. One possible advantage of the formula that the Government have either adopted or have been forced to adopt—I am not privy enough to the internal workings of the Conservative Party to know which—is that they can hear the views of the House before they proceed to implement any of the decisions that they may have in mind. I am sure that many hon. Members wish to take part in the debate, and I conclude by expressing the hope that the Government will listen with care and attention to the views of Parliament.
Several Hon. Members rose—
Mr. Deputy Speaker (Mr. Bryant God-man Irvine): Order. The House may wish to know that 28 right hon. and hon. Members want to be accommodated within the next three hours. Brevity will doubtless be appreciated most by those at the end of the list.
5.51 pm
Sir Derek Walker-Smith: The right hon. Member for Lanarkshire, North (Mr. Smith) concluded an impressive speech by saying that it was an advantage for Ministers to hear the views of the House. I speak as one who over the years has consistently opposed the concept of Stansted or, indeed, any other inland site for the third London airport. I adhere to that view today, and I am grateful to have the opportunity of giving some reasons.
Three basic issues are involved, and in each and all of them the onus of proof—this is important—rests fairly and squarely on the Government. First, they must show that in the light of present and predictable economic circumstances—not the economic circumstances at the time of Roskill, and still less the economic circumstances of a decade earlier—there is a need for the third London airport. Secondly, if they discharge the burden of proof in that regard, they must show that the need should be satisfied in the South-East rather than in the regions. Thirdly, and only if they satisfy both the other matters, they must show that it should

715
be on an inland site in the South-East rather than on a coastal site.
In my submission, the first of those matters is not proven at this time. Therefore, at any rate as yet, the second and third matters do not arise. If and in so far as they do arise, the balance of evidence is against the Government, in that they have failed to show that such a need would not be better satisfied in the regions or that even within the narrow context of the South-East the airport would not be better sited on the coast. But my primary submission is that we do not come to those issues because the other matters which are their necessary prerequisites remain unproven on the evidence.
My right hon. Friend referred to the history of the matter. The Government are the unlucky heirs to a long and unsatisfactory history in this matter. It is a history of an irrational and prejudiced preoccupation in official circles with the alleged desirability of Stansted as a third London airport. The study of that history shows the unyielding resolve of officialdom and the myriad processes by which such resolve is sought to be achieved.
Stansted has always been the favoured option of officialdom, civil servants, airport executives and some, although not all, airline moguls. In the 1960s, they thought that they were on to an easy thing, and they sought to sell their solution to the Government of the day. But, as some of us here remember, they met with strong and reasoned resistance and were forced to concede the Roskill procedures. As a result, Stansted was not even shortlisted for detailed examination by Roskill. It was eliminated in the heats and never reached the final. Whatever else may be said of the Roskill Commission, no one has ever doubted the thoroughness of its investigatory procedures.
Mr. Nott: Roskill found a green field site in respect of Cublington. That is all that I would say in respect of the Roskill Commission.
Sir D. Walker-Smith: There was a majority judgment in favour of Cublington and a powerful dissenting judgment by Professor Sir Colin Buchanan, which was accepted by the Government of which my right hon. Friend is the heir. My
716
right hon. Friend should not provoke me on this matter because I am afraid that he is not on a good wicket. However, do not let him worry. I shall come to the change of heart, if that is the right description.
I return to the history of the matter. The Stansted lobby neither lost heart nor relaxed effort. It continued to pursue the same goal, albeit along different paths. The first step was the White Paper on airports policy, which on the purported basis of a differentiation of the new situation from the Roskill situation resurrected Stansted in February 1978 as one of the three options under the designation of a major expansion of Stansted airport. The second step was the setting up of the appropriate machinery. There was no procedure this time for judicial consideration. There were no High Court judges or eminent professors of town planning. This time an advisory committee and a study group on South-East airports were set up, with terms of reference that are set out in paragraph 1.5 of the report of the advisory committee. They were:
"To keep under review, in liaison with the study group on South-East airports, the provision of airport capacity in the light of the development of demand and to advise the Secretary of State for Trade."
We should note the words "in liaison with". They are well chosen, because the two bodies were to have much in common. They would both be
"Chaired by senior officials of the Department of Trade".
The membership of the advisory committee is significant, and that is set out in detail on page 35 of the report.
My eminent and witty friend the late Philip Guedalla once described the ideal committee as
"Three just men and the statutory woman".
For some extraordinary reason, in these days of non-sex discrimination the statutory woman seems to have been omitted. I think there may be trouble there. But, hopefully perhaps, there are three just men out of 38. Only just, because no fewer than seven come from the Department of Trade, reinforced by a large contingent of air executives. That committee provided the guidelines for the study group, as we can see from paragraph 6.7. Therefore, from the beginning it was likely that the stone which

717
the builders had rejected would be made head of the corner and that the site which had failed to survive the preliminary investigations for Roskill would be brought forward to head the field. So it turned out.
I have referred to the history of the matter, because there is no doubt about the scepticism and indignation which it has aroused in the hearts and minds of many of my constituents. They are good and reasonable people and it would be wrong if their elected representative was not to give voice to their feelings in the House.
I turn briefly to some analysis of the demand, its extent and nature. The growth of demand, once so confidently expected, is now limited by the impact of oil prices. The one certainly is the escalation of oil prices, and that is clearly admitted in paragraph 3.7 of the report, which states:
"We feel that the oil price assumptions used in the base forecast err on the side of optimism and that the forecast may underestimate the possible effect of high oil prices on world economic growth and, therefore, on the propensity to travel".
That was repeated in the conclusions of paragraph 3.12. It is repeated again in paragraph 3.11. It says:
"A different method of forecasting has now been adopted, which attempts to link the availability of commercially viable air services to the growth of traffic with origins and destinations outside the South-East. The result has been a higher forecast of traffic at airports outside the South-East than was envisaged in the White Paper."
Would it not therefore be better and more sensible to put an airport—if it is needed—in the regions? That is where the demand is to be found.
An even more significant aspect is the leisure component, to which the right hon. Member for Lanarkshire, North has referred. The leisure component is covered in paragraph 3.10 and in table 3.2 at the top of page 11. This means that 70 per cent. is tourist or holiday traffic. The table forecasts 59·9 per cent. leisure traffic as against 20·2 per cent. business traffic. The right hon. Member for Lanarkshire, North showed that there would be a likely increase, even on these figures, to 80 per cent. leisure traffic and 20 per cent. business traffic.
All air traffic will be vulnerable to factors that may produce a reduction in
718
traffic. Leisure traffic will be the most vulnerable as a result of escalating oil prices, the world recession and the switch of wealth and resources to primary producers and away from the secondary producers of developed countries, which are the main source of the tourist trade. I submit that tourist traffic is best catered for by regional airports because the British tourist element is generated primarily in the provinces. There is a great degree of uncertainty and unpredictability as regards tourist traffic and the forecasts for air traffic demand. Those forecasts are notoriously unreliable, and that is confirmed in paragraph 7.4.
The factors mititating against Stansted are numerous and well known and they need no cataloguing. They include full employment, the lack of a basic infrastructure, the quality of agricultural land and the access difficulties of road and rail. The commuter rail position is notoriously unsatisfactory. I was therefore astonished to hear my right hon. Friend the Secretary of State for Trade say on 17 December that the existing Liverpool Street to Bishop's Stortford line would provide the rail link. When I had recovered from my astonishment, I felt a keen impulse to hand to him the bulging bag of commuter complaints and correspondence that I had received from my constituents. I felt like asking him to deal with it, if he could.
At the end of his speech my right hon. Friend referred to procedures. At the very least we were entitled to the best and fairest procedures. However, although those procedures are to hand, they are regrettably not to be used. I put down a parliamentary question to the Secretary of State for the Environment asking
"if, pursuant to his powers under sections 35, 47 and 48 of the Town and Country Planning Act 1971, he will refer to a planning inquiry commission, constituted under section 47 of the Act, any application for planning permission for development of Stansted airport, with a view to utilisation of the powers given in section 48(4) of that Act to refer to the commission the question whether development for that purpose should instead be carried out at an alternative site."
The answer stated:
"Appropriate inquiry arrangements will be made when the British Airports Authority has come forward with formal proposals. The scope will be wide ranging and the inspector will be able to take into account any evidence and views which he considers relevant to whether the development in question should

719
be permitted." [Official Report, 6 February 1980; Vol. 978, c. 267–8.]
I regret that no Ministers from the Department of the Environment are present. With respect, the only positive thing in that generalised answer is negative. The statutory procedure designed for the fair assessment of different sites is not to be used. If section 47 is not to be used in these circumstances, it will never be used. Its continued presence on the statute book is therefore something of a sham, and it should perhaps be removed.
This great social and environmental issue is being treated as a purely political consideration. Paragraph 7.9 of the report states:
"We have reached no conclusion on which out of the six should be chosen because that is essentially a political decision."
It also states:
"In the end, the decision on this issue will be one of political judgment in the light of the Government's view of national priorities."
What are those priorities? The importance of town and country planning, of social values of the environment and of the quality of life are certainly no less because they are difficult or impossible to quantify in economic or monetary terms.
What do my constituents want to do? They want to continue to tread their ways and till their fields in their part of England's green and pleasant land. Is that an unreasonable or ignoble aspiration in this troubled and tormented world? Does it not weigh heavily in the scale of the public good, in its broadest sense? That has been confirmed by the clear testimony of Professor Sir Colin Buchanan. He is perhaps the outstanding authority on town and country planning in this country. Is it to be wholly outweighed by the consideration of tourist traffic? I shall address to the airport lobby the words that Hamlet used to Horatio. He said:
"There are more things in heaven and earth … Than are dreamt of in your philosophy."
Are all the great concepts of the environment and the way of life to be set at naught in the hope of gain from tourist traffic? The House will recall the words of the great American orator William Jennings Bryan, imprinted indelibly in the minds and hearts of men. He said:
720
"You shall not crucify mankind upon a cross of gold."
Shall we now crucify these basic values of our way of life on the tinsel cross of tourism?
The issue of Stansted has already been tried and judgment has been entered in its favour. There is a salutary legal principle that no one may be put in peril twice on the same charge. That principle is known as autrefois acquit. That principle applies now. A Conservative Government previously decided against Stansted as a third London airport. Now a Conservative Government seek to make it such, either in name or in fact.
That prompted my reference on 17 December to a U-turn. That reference reminds me also of the melancholy query that was raised by the Morning Standard in the context of the greatest U-turn of the last century. It related to Sir Robert Peel and the corn laws. It wrote:
"He has persuaded others. How comes it that he has not persuaded himself?"
I address the same question to Ministers today. The case against Stansted becoming the third London airport has been proved and accepted. It should not be put in peril again. I therefore ask the Government to follow the dictates of precedent, logic, propriety and good sense. I ask them to modify their policies in order to give effect to them.
Several Hon. Members rose—
Mr. Speaker: Order. Every hon. Member who is in the Chamber at present, except the hon. Member for Wirral (Mr. Hunt), wishes to catch my eye in this debate. That will be possible only if hon. Members make brief speeches. As hon. Members have direct constituency interests, I should like to call them all.
6.10 pm
Mr. Stanley Newens: Like the right hon. and learned Member for Hertfordshire, East (Sir D. Walker-Smith), I represent a constituency in the neighbourhood of Stansted. However, my arguments tonight are not based solely on local considerations. I do not wish to take a narrow constituency point of view, because I believe that the issues must be considered in a regional, national and even wider context. It is fundamentally because of these wider reasons

721
that I am opposed to the Government's policy.
The Government base their case for making Stansted the site for major expansion in the period ahead on the contention that air traffic is destined to increase at a rate of 6½ per cent. to 7 per cent. a year and that existing airport capacity will be exhausted by the late 1980s.
First, I should like to comment on the unreliability of past forecasts. In the 1960s it was stated, on what was regarded as the best authority, that the runways at existing airports in the South-East would he unable to handle the traffic by 1973 and, therefore, the need for the third London airport was imperative. Then, in 1971, the Roskill report said that the four South-East airports would be able to handle the growth up to 1980 but that there would be an additional need from 1981 onwards.
However, in 1974 we were faced with the oil crisis and a world recession, which caused yet another contraction in the figures. Then it was argued that the traffic could be accommodated until 1985. In any case, it was admitted that the runways were no longer a major need because, owing to the larger wide-bodied aircraft, the traffic could be accommodated provided that the terminal capacity was expanded.
The 1978 White Paper on airports policy once again reduced the estimates of anticipated growth to somewhere between 66 million and 89 million journeys a year by 1990. The lower figure would mean that the capacity would be sufficient to deal with the limited expansion envisaged for a longer period.
Today, the Government have made certain assumptions on the growth that will take place thereafter. I believe that we should question very seriously these assumptions. The first assumption, which is stated in the Government's background brief, issued on 17 December 1979, is that economic growth will be at a rate of 1·7 per cent. to 2·6 per cent. a year in this country to the end of the century and 3 per cent. to 4 per cent. in the rest of the world. The second assumption is that the necessary aviation fuel will be available at an acceptable price to sustain a huge expansion of air traffic.
722
The first assumption about economic growth is decidedly optimistic and, at the very least, highly tendentious. The assumption about the availability of aviation fuel is wildly optimistic. The Advisory Council on Energy Conservation in paper 9, published last year, states that by the end of the century
"the oil consumed by the United Kingdom civil aviation industry will have increased to about 2½ times the present level."
In view of the prospect that North Sea oil will be running out at that stage, if not exhausted altogether, and in view of the situation in the Middle East, even if methods of converting coal into aviation fuel are feasible the assumption that fuel will be available at reasonable prices and in the quantities required is wildly optimistic.
Some people have mentioned hydrogen fuel, but, on the basis of the report of the advisory committee,
"hydrogen has the disadvantage of requiring more energy to manufacture than its own calorific value."
Feasibility does not rest on long-term considerations, but fundamentally I question the right of this generation to burn off all the fossil fuels accumulated in the earth over millions of years. I believe that our decision to go ahead with that might be fraught with all sorts of environmental problems with which we have not even thought of coming to terms. For that reason alone, I seriously ask whether we are wise to allow aviation to consume huge quantities of fossil fuel at the rates envisaged.
In the circumstances that I have described, I think that that may not even be possible. At the very least, the growth figures, on the basis of the way they have changed over the last 15 to 20 years, must be regarded as unreliable.
Even if, despite all that I have said, air traffic grows at the rate suggested, we should not allow all this traffic to come to the South-East alone. Paper 9, which I have already quoted, states that by the end of the century 90 per cent. of all air traffic will be for leisure purposes. The White Paper said that two-thirds of the increase in traffic would be in leisure traffic. When we get down to the figures we find that we are talking about an increase in the number of foreign leisure passengers from 5 million in 1978 to 16 million in 1990.

723
It seems quite idiotic that we should accept such a growth, centred on South-East England, for many other reasons than just airport capacity. Tourist facilities in the South-East cannot possibly cope with this growth of traffic. The hotels and tourist facilities do not exist, and our streets, roads and public places would be grossly overcrowded if we allowed this sort of increase to take place.
On the other hand, it is suggested that in Northern England the demand is insufficient to maintain a gateway international airport. If leisure traffic is to grow at anything like the rate envisaged, the Government should insist that regional airports take a very large share of that traffic. I am not suggesting that it should go to Birmingham, with its particular problems, but I believe that at Liverpool, Manchester and Prestwick, for example, there are ample opportunities for the development of traffic.
The whole question of regional airports should be investigated. The idea that traffic will be lost to the Continent if aircraft cannot land in the London area seems nonsensical. If aircraft land in Manchester, passengers can be in London within two or three hours. With the sort of congestion that occurs frequently on the roads, it sometimes takes as long as that to get from Heathrow. We should be realistic when we consider these arguments.
The development of a major airport at Stansted, according to the Secretary of State, would require 1,500 acres for a terminal, with a further option on 2,500 acres for the future. But the right hon. Gentleman grossly neglects the vast urbanisation that would result. It is true that this may have been exaggerated in some quarters. But appendix 5 of the report of the study group on South-East airports indicates little prospect of much local recruitment of labour. It states that in the end total population over and above that expected without an airport would be greater by 208,000 and that an estimated 71,600 dwellings would be required. The report speaks of two additional new towns in the area.
Since the end of the war, a tremendous amount of development has taken place in Essex and the whole Lea valley. To create further urbanisation on the scale envisaged, if the area were to take in
724
that amount of labour from outside, would be a complete negation of planning. It would amount to sheer vandalism. The Abercrombie view of London, with its open background, would be completely destroyed on the north-east side, as, I believe, it has been destroyed on the western side. It would be more sensible, in my view, to use labour in other parts of the country by developing the regions rather than drawing workers into the South-East, where there would be the problem of providing housing and services for them and their families. Whatever the value of the air traffic industry, it would be greatly outweighed, in the long run, by the real cost of urbanisation—and for no good purpose.
The question of agriculture has been raised. While the land is grade 2 agricultural land, only 2·8 per cent. of land in the country, I understand from the National Farmers Union, is of better quality. We should not dismiss the value of the agricultural land too lightly.
I believe, therefore, that there should be a limit on growth in the South-East as a whole. I am not arguing that Stansted should be closed or that there should be no development at all at Stansted. I believe that moderate development at Stansted to enable it to take 4 million passengers a year—provided that that figure was a final ceiling—would be reasonable. I hasten to add that I am not one of those who argue that development should take place in another part of the Greater London area. I would be as much opposed as certain hon. Members on the Government side to the idea of a fifth terminal at Heathrow.
Heathrow is an example of what ought not to be done in the Essex-Hertfordshire area. The answer must be to move the traffic, if it is to grow, to the regions.
I am utterly opposed to a new London airport, a third London airport, or anything tantamount to that. The Government proposals are for a third London airport at Stansted. I am not an advocate of Maplin. I am opposed to the development of Maplin, but, at the same time, I wish to make clear that if it came to a choice between an inland site or an offshore site it would in my opinion be an even greater disaster to have an inland site. I must again emphasise that I am not saying that the problem should be

725
shifted somewhere else where the development is not wanted.
I believe that there are places in the regions where people would welcome the opportunities that airport development would provide. It should be the purpose of the House to see that they get those opportunities.
I have set out in early-day motion 416 the policy that I believe the Government should pursue. That early-day motion has now been signed by almost 100 hon. Members. Despite the fact that the Government have asked only that the House should take note of the motion that we are discussing, they must recognise and, I hope, take note of the fact that many hon. Members are strongly opposed to the acceptance of their policy. The inquiry that is due to take place must deal not only with the local issues but with the question whether there is the need for an airport in the South-East at all. It must also deal with the role of regional airports and the implications of the vast urbanisation that would result if Government policy for Stansted were followed through.
I am unhappy about the Secretary of State's remark on the queston of objectors' costs. The Stansted solution has been turned down twice already. It is unfair that people who have twice proved their case should be asked, virtually at their own expense, to do so once again.
I wish to come to a conclusion. [HON. MEMBERS: "Hear, hear"]. I appreciate the concern of hon. Members in this matter. I believe that I am entitled, as someone who has pursued this matter, to comment on the issue. Some hon. Members may not have paid the amount of attention that I have paid to the matter over many years since the 1960s. I am trying to advance not simply a narrow constituency view.
I believe that the House should not rush into accepting the decision that the Government are putting before us. That is, fundamentally, the decision that the air traffic lobby has always wanted. I believe that the Government are totally mistaken in choosing Stansted for major expansion. Previous generations, by action that appeared logical at the time, have desecrated huge areas of this green and pleasant land in which we have the
726
good fortune to live. We should look carefully before agreeing to further desecration on the scale that would be involved in Essex and East Hertfordshire.
I believe that the Government should not go ahead with the policy that they propose for Stansted. They should pursue a policy that would allow air traffic, if it were to be expanded at the rate suggested —although I do not necessarily believe that all anticipated growth will happen—to be absorbed in the regions. That would be good not only for Stansted but for the whole country. That is the case that I put before the House.
Several Hon. Members rose—
Mr. Speaker: Order. When an appeal is made for short speeches and it falls so completely on deaf ears, my only remedy is to remember.
6.30 pm
Mr. Cranley Onslow: Unlike the hon. Member for Harlow (Mr. Newens), I think that the Government are right, in so far as it is possible to be right, and that they are certainly right to end the uncertainty. I accept that this is a speculative area. I mean that in the strictest business sense. We cannot possibly prove what the market will be. We do not know how it will develop. We can only conjecture. The best that we can try to do is to make the sort of investment that will stand a chance of being profitable on the basis of the best judgment that we can make, with the facts now in our possession, of future trends.
Who knows whether we shall be proved right? Those who say "Let us not do anything" are certain to be proved wrong. I know that my right hon. Friend thinks that the tourist trade is a dirty one. I happen not to agree with him. It is an important trade. It is responsible for nearly one-fifth of our earnings in invisible exports. It brings £3,500 million a year gross into the United Kingdom, and I am not disposed to spit on it.
Equally, I am not disposed to believe that if we have zero growth in the South-East all the passengers will go rejoicing to Manchester or Prestwick, for example. I believe that they will go to Paris or Schipol. Like it or not, London is the main magnet. Tourists come here to say that they have seen the Tower of London and to photograph it. They come to see

727
the Palace of Westminster and to photograph that. They come to see Buckingham Palace. Do tourists never go to theatres or stately homes? The tourist trade is an important business. That fact cannot be dodged. These are times when, goodness knows, we need business that will yield a profit.
We must recognise that there will never be direct scheduled services every day from Manchester to Melbourne, from Liverpool to Los Angeles or from Newcastle to Nairobi. If there were a demand for package holiday tours from regional airports to some of the places that I have mentioned, or to anywhere else, surely Sir Freddie Laker would be meeting that demand now. The self-appointed experts would be making a "bomb" if they had gone into it. However, I do not believe that they have the answer. Sir Freddie knows more than they do, and he is not in that business.
I should like to see more regional city fares. I should like to see the 1,500 licences taken up that my right hon. Friend mentioned. I should like to see Scotland specialise more in providing an alternative international gateway. It is the only region in the United Kingdom that is capable of providing that alternative. However, would not Mr. Adam Thomson of British Caledonian Airways Ltd. be developing that market if there were a market to develop? He and others like him know more about the business than we do. We should take note of the fact that they are not putting their money into developing the regional trend. That must mean something.
We must brace ourselves and adopt a positive solution to the problems in the South-East. I suspect that Stansted is the most flexible solution. All those who say that the figures are wrong must face the fact that the more the shortfall of statistics goes below the forecasts, the more right the Stansted solution has to be. That is because it involves the least expenditure and the least waste. I do not like to say that.
In the same context, I do not like to say that one of the changes in air traffic in the past 10 years has been that the noise nuisance has greatly diminished. Some of the old attitudes and assumptions that some of my hon. Friends still
728
have no longer prevail in my constituency. In the old days I received about 100 letters a year about aircraft noise. I now think myself unfortunate if I receive about 10 such letters. Let us be under no misapprehension about what has been happening around us.
We must realise that if we are to go ahead with an airports policy we must do so on the basis that we shall try to minimise the consequences. I was encouraged to hear my right hon. Friend say that he wanted as much development as possible of the ancillary services within airport boundaries. We do not want to have the beastly sprawl that is sometimes associated with airports. We do not want to have uncontrolled traffic. We do not want to have endless car parks. If we must have some car parks, let us mass them as a shield between the airport and the community and the countryside. Let us use them to minimise the beastly glare in the sky at night, which most of us hate so much and which is a feature of modern life.
These developments will all be uncomfortable. However, we must not think that nothing can be done to minimise the consequences. We must not think that it will not be possible to encourage people to commute from the rundown areas of north-east London to Stansted. Let us not think that we shall not be able to stop some in the Stansted areas from commuting into London. Let us be imaginative and positive. Let us recognise that we can control this growth and that it may be possible to profit from the fact that it will be gradual.
Like most hon. Members, I have had a letter from the chief executive officer of the district council of Uttlesford, a marvellous old English name. I am sorry to say that I had never heard of it before the letter arrived. It is the district in which Stansted lies. The chief executive officer says—it is the one thing with which I agree:
"The siting of a major airport is a planning issue of national significance."
He adds—I accept that this is his opinion and that he is entitled to it:
"it is plain that such development in this District, bringing with it the extensive urbanisation and industrialisation which characterises the area surrounding Heathrow, is profoundly inappropriate."

729
He concludes with a plea that airports policy should be
"decided in accordance with long-term national interests."
I am afraid that there he destroys his own argument. If there is a conflict between long-term national interests and long-term local interests, which should prevail? That is the question that we should ask ourselves. However painful the decision, and irrespective of the genuine regret for the consequences in the constituencies of our friends, which we know will cause great distress to their constituents, I hope that the House will take the view that we must fix our minds on the national interests in these most difficult times.
6.38 pm
Mr. Arthur Palmer: I think that we can divide those in the Chamber into two groups. The first group consists of those who would like to have an airport and to see it extended. The second group consists of those who would prefer not to have an airport. If they had one, they would prefer not to see it extended. I belong to the group that would like to see local airports extended, particularly Bristol airport at Lulsgate. I am glad to see the hon. Member for Bristol, North-West (Mr. Colvin) in his place. I am sure that he will agree with my view in this respect.
Lulsgate is on the Bridgwater-Taunton road. It was originally a Royal Air Force station. From 1957 onwards it was developed on the security of the city. Its passenger facilities were improved constantly until 1972. Since then there has been little capital development in spite of the airport's growing popularity. It is now urgent that its facilities should be improved. A runway should be constructed that is capable of taking modern jet aircraft. An instrument landing system should be included.
As I say, the airport is on the Bridgwater-Taunton road, the A38. That is a great advantage as there is easy access to the city centre. However, it is a restraint on the development of the airport and the construction of a longer runway that is so much desired. To build a longer runway at Lulsgate will necessitate going under the A38 or diverting the road. There is no doubt that a considerable sum of money needs to
730
be spent. Whether the money should be spent by Bristol ratepayers alone or by a wider consortium of local authorities, and perhaps local business interests, is still an open question.
The statement that the Secretary of State made in December 1979 gave encouragement to the Bristol civic authorities. He spoke of the need to develop the regional airport system in order to ease the burden on the London airports system. We in Bristol particularly liked the part of his speech in which he said that it was important that policies should be adopted
"to maximise the potential of the English regional airports".
In the course of the questioning that afternoon. I mentioned to the right hon. Gentleman the strong claims of Bristol in the South-West as a regional airport capable of a great deal of development. After all, Bristol is within a short distance of London. We have one of the best and fastest train services in the country, if not in Europe, and there is also the M4 motorway passing Heathrow.
The answer given to me by the right hon. Gentleman raised hopes in Bristol. Reminding us that he was a West Country Member, he said in reference to my question:
"if he wishes to persuade his local authority to make approaches to us about additional runway capacity and additional terminals, I am sure that we should be prepared to look at them sympathetically."—[Official Report, 17 December 1979; Vol. 976, c. 35, 46.]
That was the right hon. Gentleman's answer. I now say to him that he should be careful about raising hopes and then dashing them so quickly.
I have received a letter from Councillor Draper, the leader of Bristol city council—there is a Labour majority on that council, but there is no difference between the parties on this issue—saying that the city council has had a reply, not from the right hon. Gentleman but from the Under-Secretary of State. I would have thought that the right hon. Gentleman could himself have sent an answer to a city as significant as Bristol. However, the answer from the Under-Secretary of State can at best be described as a dusty one.
The Under-Secretary of State shortly reminded Bristol that if Bristol was given any encouragement it would also be

731
necessary to take into the account the claims of other airports and that, even though a development certificate were granted, the project would still have to take its place in the queue—because of current Government limitations on all public expenditure—with other industrial development in the Greater Bristol area. In view of what the right hon. Gentleman said in the House before Christmas, the answer now received by Bristol from the Under-Secretary will give great offence there once its contents are generally known.
6.42 pm
Mr. Alan Haselhurst: I apologise to my right hon. Friend the Secretary of State for being a few minutes late at the beginning of his speech. I also thank him for the courtesy and consideration that he has shown to me in the undoubted difficulties that I experience as a result of the statement he made on airports policy before Christmas.
I seek the indulgence of the House because my constituency is at the epicentre of these proposals. We are debating the Government's policy, and the central thrust of that policy falls directly into my constituency and into no other, although neighbouring hon. Members—two of whom have spoken most ably—are similarly concerned about the effects of that policy. The issue comes down absolutely into the Saffron Walden constituency and I am conscious of my responsibilities to my constituents on this occasion more than I have ever been before in making a speech in the House. I cannot think of a subject that might arise in future which would be of greater significance to my constituents. We are all aware that we are concerned with a planning decision of national proportions even though the effects of that decision are felt in a particular area.
There are differing views in my constituency about the future of Stansted airport. Those who work there and who are most directly concerned become anxious when views are expressed about limitations on development at Stansted that are tantamount to saying that the airport should close. There is a wide divergence of opinion among workers at the airport and others in my constituency,
732
but they are all nevertheless united in opposition to the siting of an airport there on the scale envisaged by the Government's proposals.
I hasten to add that I do not approach this issue on the basis that so long as the Government's policy might change and remove the problem from my back yard, that is all I am concerned about. When I was the Member for Middleton and Prestwich I genuinely took the view —some may say by happy chance—that Stansted or any other inland site was the wrong place for a major international airport. Therefore, I have not had to do mental gymnastics in order effectively to represent my present constituency.
I try to approach this matter as a searcher for truth, looking at it as objectively as possible in all the circumstances. However, I am aware that what I may say is bound to have implications perhaps for the constituencies of my hon. Friends. I hope that I can also speak in a way that shows that I am attempting to look at the problem in a wider sense rather than in a narrow, selfish constituency way.
I hope that the Government are prepared to look at this issue in the same way, though there was a degree of finality about certain remarks of my right hon. Friend. I hope that he will consider some of the issues as open to further consideration and discussion, not least in the light of what he will hear in this debate. We should endeavour in discussing this difficult question to find the most equitable and sensible solution, bearing in mind all the factors.
Stansted is not commonly grouped with the other inland sites that were considered. Lord Boyd-Carpenter, in another place, went to the length of pointing out that Stansted was an existing airport. Many people living in that area do not see it in quite the same light. Of course, there is no doubt that there is a runway there and some rudimentary airport buildings most of which, as I understand it, will disappear as a result of the proposals likely to be put forward by the British Airports Authority.
In this case the people see the area around Stansted as being unspoilt green countryside of prime agricultural value. They do not see any great distinction between Stansted and the other inland

733
sites that are being considered. I suggest to hon. Members that if they visited Stansted they would come away with an impression that it was largely a green field site and that there was hardly any evidence at the moment that there was a runway there or an airport at all.
I sympathise with the position in which the Government find themselves. I recognise that the chopping and changing of decisions over previous years has created great difficulties and I know that the Government are faced with an appalling decision in the light of current public expenditure requirements.
There was not a great deal that I liked in the statement by my right hon. Friend before Christmas, but at least I am grateful for the fact that he seems to be making it clearer with each statement that there will be a fair and full inquiry when the BAA has brought forward proposals. It is essential that if the Government are to get their way in the end they should be seen to have done so fairly. There must be a proper opportunity for all points of view to be heard, and those who are genuinely and sincerely opposed to the proposed development should be allowed to put their case in the most effective way possible.
I am disappointed that my right hon. Friend is not able to do more to help those people affected by blight. There are some truly appalling cases at the moment of people trapped in a situation as a result of the announcement of these proposals for whom there is no remedy as far as I can see over the next 18 months to two years. This blight adds to the bitterness that is felt when the Government appear to be choosing Stansted despite rejection on two previous occasions.
The Government have said that they believe in a regional policy, and yet my right hon. Friend is obliged to admit that a new airport would perhaps cream off no more than 1,500,000 passengers from the South-East. I hope that the issue of regional policy which was such a feature of my right hon. Friend's statement will be examined in greater depth. The statement said that there would be no third London airport. I think that my right hon. Friend has failed to persuade many people on that point. Most of us recognise that the proposals are tantamount to say-
734
ing that Stansted will become the third London airport in time.
The environmental and financial costs have not been properly weighed. The Government suggest that a high degree of urbanisation will not result from their proposals. I remind the Secretary of State of what the advisory committee said on page 29 of its report:
"experience of other major airports strengthens the view that the initial decision on siting has profound and permanent effects over a wide surrounding area."
If there is no urbanisation problem in the wake of the build-up of the airport, I am not sure why my hon. Friends are here tonight.
My right hon. Friend will not persuade me readily that people will go in their thousands in the reverse direction down the M11. People will want to settle near where they work. The environmental effects of the Government's proposals will cause irreversible damage to large tracts of countryside. The real cost will be the urbanisation that is bound to follow.
I turn to the question of the proposals' total cost. My right hon. Friend is heavy on figures relating to the alternatives. He is able to put price tags on the unacceptable items but not to his proposals. Proper costing must be done so that the House can make a final pronouncement when the arguments have been rehearsed more carefully. With the likely urbanisation, the cost of the Stansted operation could be higher than my right hon. Friend would like the House to believe. If the Government will the beginning, they must will the consequences.
If we are worried about public expenditure, we should not start a project with mild beginnings which will reap a tornado of financial commitment in the long term. We must bear in mind the true costs involved in the build-up of Stansted. We must not treat too lightly the question of access to the airport. Time and again it is said that there is easy access to Stansted by road and rail, but those who often make the journey know that that is nonsense. One cannot rely upon a fast and convenient journey by road or rail to the Stansted area.
It is incumbent upon anybody who speaks in this debate to be clear about

735
his assumptions of future need. The distinguished Sir Colin Buchanan has questioned whether we should welcome tourism on an indefinite basis. Just because it earns £1,000 million and provides 40,000 jobs, that is not the end of the argument. A cost must be weighed on the other side in terms of damage to the environment, the take of agricultural land and congestion in the capital and other areas. We must not reach for the crock of gold and say that that is the benefit of so many tourists coming to the country without any offset.
It is possible to argue that there will be no need for a new airport. My right hon. Friend was at pains to suggest that he is trying to find the most flexible solution. My right hon. Friend could be spot on. If he plays roulette and manages to put the ball into the 15 million hole, he will win because his proposals can then be argued to be justifiable if demand rises no higher than 15 million. However, he almost admits that he does not believe that that will happen because his proposals include the safeguard of a possible second runway at Stansted.
It is likely that there will be a growing need. The Secretary of State must not argue that he has a flexible formula that will prove to be right. Unless he is exactly right, he will be appallingly wrong. If demand is nowhere near 15 million, his proposal is an enormously expensive way of dealing with the problem. He could have chosen the option of a fifth terminal at Heathrow or development in the regions. I am sure that there are alternative ways of dealing with a demand of less than 15 million.
Mr. Michael Shersby: Will my hon. Friend, when talking about a fifth terminal at Heathrow, bear in mind that the people living near that airport have already to put up with four terminals and millions of people using the access roads? Will he remember that Heathrow began as a green field site and that many of his constituents who enjoy holidays abroad fly over our gardens when they take off from Heathrow?
Mr. Haselhurst: I hope that my hon. Friend will not misunderstand me. We have been over that ground before. My reference to a fifth terminal was a throwaway remark. I do not take lightly the
736
problems of those who live near Heathrow. I am saying that if the demand is less than 15 million the Government proposals represent the worst possible option.
I believe that demand will grow and that we can accommodate more tourists. I am sure that our citizens will want to travel abroad on holiday. Demand probably will increase. That worries me more than anything. I believe that a fully used two-runway airport at Stansted will then indeed be developed. When one takes that view, one sees the Government's proposals in their full horror. It is no good arguing that the proposals are the most modest and reasonable solution that can be found. The Government must face the likelihood that a full-scale operation will be needed in the end and that their proposals could be the most costly and most environmentally damaging way of dealing with the problem. If the Government will the beginning, they must will the end.
What will happen in the year 2000 if the demand is for a 50 million capacity? Will the Government then turn to Yardley Chase or Hoggeston because extra sites must be found? That would be the worst of all worlds. We must accept that there will be a high demand. On that basis we must find a solution which is consistent with that demand.
We are being asked to accept an unmeasured environmental impact on which the Government are reluctant to put a price. We are being asked to accept a proposal when we know nothing about its bounds. Where will it lead us in the end? There has not been enough serious basic thinking about the problem. We could be tripping very lightly down a path which will lead to enormous expenditure. In 10 or 20 years people will ask how on earth we could have been so foolish as to embark upon such disastrous proposals.
We are asked to take note of the proposals. I can do that. I do not intend to oppose the Government in such a modest request. However, they are asking my constituents to face the possibility of unlimited development. The Secretary of State apparently has closed his mind to the possible options. Will he and his colleagues please take note that he is whipping up the most tremendous opposition in my constituency? He will also

737
encounter the growing opposition of people who are worried about agriculture and the countryside. In the end there will be a tidal wave of public indignation. It would be as well to understand that now and not complain if it comes upon him by surprise.
7 pm
Mr Stephen Ross: I intend to follow the request made by Mr. Speaker and to speak briefly. I appreciate that many hon. Members with constituency interests want to express them tonight. In addition, it is time that the Secretary of State had a second friend. He has made a courageous decision. His speech today was persuasive. As I indicated on 17 December, I largely support the policies put forward by the Government.
I do not want to dodge the issue. The parties must come clean on this matter. I am grateful for the fact that the Opposition also stated their point of view.
In my constituency the great argument is that we do not want more large ferries bringing more visitors to the Isle of Wight. I am in the middle of that at the moment. In a slightly different context, the same argument is going on in all parts of this country, including Cornwall, where there is resentment at continuing tourism, which is filling up the roads to an extent that no one ever envisaged.
Whether we like it or not, the South-East is likely to attract growing numbers of people and business interests. That fact cannot be ignored. There is room for more beneficial use of four provincial airports. My daughter lives in the North-East. Recently she went on a package tour to Switzerland. She came all the way from Newcastle to Luton in a coach. That is crazy. It would have been much better to take off from Newcastle. We must persuade the airlines to do that. Presumably there are attractions at Luton that cause them to operate in the South.
I go past Southampton airport weekly. I realise its limitations. It is as well that the hon. Members for Southampton, Itchen (Mr. Mitchell), for Eastleigh (Mr. Price) and for Southampton, Test (Mr. Hill) are not present. We could make more use of that airport. There is a railway station on its doorstep. It is only one hour to London.
738
However, that airport does not seem to be used to any extent. It should be used more for the Channel Island and internal flights. However, those are just drops in the ocean.
We face the inescapable situation that Heathrow and Gatwick are facts of life. Hundreds of millions of pounds have been invested in those airports. More is planned for the fourth terminal and a possible second terminal at Gatwick. Stansted exists but carries only 300,000 passengers a year. It makes sense to expand Stansted, but the question that the House and the planners must decide is to what extent. To me, it is horrifying to think of anything like 15 million people when we realise that Gatwick now carries only 6 million to 7 million. I agree with what was said by the hon. Member for Saffron Walden (Mr. Haselhurst). The solution will depend to a large extent on the world economic situation, including the cost and availability of fuel. It will depend on the numbers who want to visit London. At present, seven London theatres are empty. To some extent we have killed the golden goose with the prices of many of our hotels and shows. We must get back in the act. Many people are now bypassing us. Perhaps not so many people will want to come to London in the future.
I have always supported the rail-only tunnel. That could take some numbers, but not very many—probably more from the cross-channel boats than aeroplanes. I think that is the official view.
The main question still to be resolved is, if the demand merits it, whether we expand above the 15 million passengers possibility at Stansted or reconsider the Perry Oaks site. Provided that the road and rail links into that site are adequate to meet demands, that solution should come fully into the reckoning and not be ignored.
Mr. Jessel: Do I understand that it is the policy of the Liberal Party to advocate a fifth terminal at Heathrow?
Mr. Ross: That alternative must be considered in relation to a further expansion of Stansted to anything over 15 million. I take that point and put it on the record. That point is certainly an alternative.
Who will bear the cost of the Stansted development? From where will the

739
money come? Will the BAA be financed by Government sources? Is it proposed that the funds come from the long-suffering passengers? That is an impossibility. It would price our airports way above the international figures. Passengers will be frightened away. Then we need not build the airport at all.
7.5 pm
Mr. Peter Hordern: You, Mr. Deputy Speaker, and Mr. Speaker have been good enough to call right hon. and hon. Members whose particular interests are at Stansted airport. That is no surprise to me. It must have come as a considerable shock to my right hon. Friend the Secretary of State and my hon. Friend the Member for Saffron Walden (Mr. Haselhurst) when this proposal was revised, having, so it seemed, been erased altogether by the Roskill report. It was the pusillanimous action of the previous Government in doing away with the Maplin site that caused this problem. I think that that proposal called forth almost universal approval of Government supporters, although perhaps not total support.
I readily appreciate the seriousness and the gravity of the situation faced by my right hon. and hon. Friends who represent constituencies surrounding Stansted airport. However, the situation is no less serious than that which faces those of us who represent constituencies around Gatwick airport. There is a very serious situation there. At the moment 8 million passengers go through the airport. The West Sussex county council and other local authorities thought it right to agree to the considerable expansion of Gatwick airport in terms of increasing passengers to 16 million a year. I say that with no disrespect to my right hon. and hon. Friends. That is the maximum that is proposed for Stansted's development.
So far, the local authorities in my constituency have raised no objection to doubling the number of passengers going through Gatwick. However, the construction of a second terminal at Gatwick would be a different matter. That would allow 25 million passengers to go through Gatwick airport.
First, I want to deal with the effect of the proposal on the environment. The West Sussex county council is the plan-
740
ning authority for Gatwick airport. Its considered view is that if the number of passengers was allowed to go up to 25 million a year a whole new town would have to be built, containing 70,000 people. That is in addition to the existing new town of Crawley, which I am privileged to represent. That is an enormous number of people on what is probably the most expensive land in the county.
I represent two large towns—Horsham and Crawley—but they have different characteristics. Those who live in these towns would like to preserve them. If the airport were developed as proposed and the population increased, as it would do if the second terminal were built, there would be no alternative to regarding north-west Sussex as being a long and continuous strip of urban development, which would remind one more of an elongated Neasden than anything else.
I shall not detain the House with argument about noise, which is a serious problem for my constituents. This matter has been dealt with on many previous occasions. I wish to concentrate on the industrial effects of the proposal to construct a second terminal.
There has been considerable debate about the deindustrialisation of the country. This is proceeding apace, whether we consider the North-East, the North-West, part of Scotland or the Welsh valleys. Certain parts of the country do not suffer from deindustrialisation in any way, notably the South-East.
More and more the wealth of the country is contained in small industrial areas that are the success stories of British industry. One of the most successful parts of the country is Crawley new town. It started in 1947. It has an unbroken record of industrial success. In the 16 years that I have represented Crawley there has not been a single strike.
There has been continuous growth of production, continuous technological development and a magnificent record in exports. I have therefore thought it right to ask each of the major firms in my constituency for its reactions to the effect of a second terminal at Gatwick airport. I would like to read some of the replies that I have received.
First, I refer to a major United States drug company. I am sorry that I cannot

741
give the House its name, because I have not its permission to do so. It says,
"Crawley Industrial Estate has developed over the years to provide a variety of occupations, many in the fields of science, research and innovation, thus adding to the nation's wealth. Uncontrolled expansion at Gatwick might result in several companies experiencing such difficulties in maintaining a viable labour force that they had no option other than to move away from the locality. The Industrial Estate might become little more than an office and warehousing annexe for the airport, and the school-leavers of the future denied an opportunity to learn and master a range of technological skills."
I refer to another company, again a major overseas firm:
"The overall expansion that you detail we consider to be a negative factor, likely to make us consider expanding our business elsewhere, probably on the Continent."
One of the largest employers says:
"The position will be quite intolerable if the proposed further expansion of Gatwick is allowed."
The argument of my right hon. Friend in his opening speech was that if neither tourist traffic nor ordinary traffic comes to this country it will assuredly go to the Continent and we shall lose out. I ask the House to consider that if a second terminal is built at Gatwick there will be much the same effect on major industrial firms in my constituency. It is no good the right hon. Member for Battersea, North (Mr. Jay) shaking his head like that. He has not received the kind of detailed replies that I have had from my constituents.
Is it a wise industrial policy seriously to damage that part of industry which is possibly the most successful in this country, if not the whole of Western Europe? Should we consider halting the growth that it has managed to achieve over many years, or causing it to take its business to other countries rather than to expand in Crawley itself?
I recognise that this is a very real dilemma for my right hon. Friend and I acknowledge that the choice between Stansted, a second terminal at Gatwick or another at Heathrow is an extremely difficult one. But it seems to me to be the utmost folly to run the risk of imperilling one of the very few industrial areas of the country that are flourishing. This would undoubtedly happen.
I conclude on a more constructive note. Half the movements in and out of
742
Gatwick airport consist of charter traffic, but more than two-thirds of the passengers consist not only of charter traffic but, as I understand it, tourist traffic. Not only has the case been made many times in this debate that we ought to make better use of our provincial airports; I really do not see why we should lay so much stress on the importance of tourist traffic. These passengers could at least start their journeys from other regional airports through the country. Can it be right to put at risk the continued expansion of industry in a really successful part of the country in order to allow tourists to leave from a particular airport in the South-East? There must surely be a more rational way of going about this. I hope that when he winds up the debate my hon. Friend will consider these matters most carefully.
7.15 pm
Mr. Tom McNally: I understand, Mr. Deputy Speaker, that you are under some pressure to accommodate the serried ranks of perspiring Home Counties Tories who this evening wish to place on record their doubts about Government policy, but this debate is not simply about the Home Counties or even about Stansted. It is about airport policy.
A regional strategy is an essential plank in the Secretary of State's own airport policy. What we doubt is that there is any real substance in this attitude or any real commitment to that regional strategy, because we have so far seen precious little evidence of it.
I have some sympathy for the Ministers in their dilemma. Before I came into the House I had a little experience in trying to move Spanish airlines from Heathrow to Gatwick, which almost had the Armada sailing again, so I realise that the Ministers have problems. I am also aware that many of us want all the benefits of air travel, with none of the problems.
We must all realise that when we discuss airport policy we are not simply discussing some grand design or some remote strategic decision. For millions of people the decisions that the Minister makes will be intensely personal, affecting the value of their property and the quality of their lives. That is why I shall be very interested to hear what the Minister has to say in his winding-up

743
speech about soundproofing and double glazing. There should be national standards. The criterion should be the effect of the nuisance rather than who owns the airport.
My main concern this evening is the role of regional airports and the degree of commitment on the part of the Government at the present time. The Minister will not be surprised to learn that most of my remarks will concern Manchester airport. I am sure that he will say, as proof of his interest, that he has recently visited the airport and said some encouraging things to the people there.
I must say, however, that he is a typical South-East man. His whole attitude to moving out of his own region is that of a man spending the previous night surrounded by his friends and, on leaving in the morning, kissing his children goodbye before going on a kind of Marco Polo expedition, perhaps never to return. Nothing that he has said since he became Minister, or anything said by his colleague the Secretary of State for the Environment, really demonstrates a substantial commitment to a regional airports policy.
This is sad, because there is a real commitment in the regions. There is a great deal of enthusiasm, which ought to he matched by a similar commitment from the Government.
Mr. Tebbit: I hope that the hon. Member has noticed the financial sanction that has been given to Newcastle airport in the last few days. I do not think that Newcastle is in the South-East.
Mr. McNally: I know that it is not in the South-East.
What worries me is the rather dismissive attitude of the Secretary of State. In his opening speech he said that he did not want to force people to go to remote airports. He means airports that are two or three hours' travelling time from London. He said that he did not want to force people to go hundreds of miles. Manchester airport, one of the airports under discussion, is about 190 miles from here. We are using an island mentality when discussing distances and the degree of inconvenience that we are
744
asking people to incur in order to put a real regional strategy into practice.
I was very disappointed, but not surprised, that in his intervention the Secretary of State saw airport policy in a vacuum, whereas many on the Opposition Benches see it as an important factor in industrial, trade, regional, employment, tourist and transport policy.
The Manchester Airport Authority should be attractive to the Minister, because it believes that the whole of its development during the 1980s can be self-financing. It is an airport that wants to expand in an area that wants a major international airport. I entirely accept what the Minister said about the importance of freight to airports. He quoted a figure of 18 per cent. Manchester handles £1 million worth of freight per day every day of the year and wants to build one of the most advanced freight terminals in Europe.
I regret that the recent Government decision on regional aid to areas around Manchester takes away from the area Government aid to develop industry just at a time when the airport wants to expand. That is an example of one Government policy working against another. Nevertheless, I am confident that an expanded airport can and will be a focal point for industrial development, not least in high-technology industries.
Manchester international airport estimates that during the 1980s it could provide 5,000 extra jobs in and around the airport. I suggest that the Minister should go to his friends and colleagues in the Department of Employment and ask how much public money it would cost to create in South Manchester 5,000 extra jobs. The jobs that I am talking about would be created at no cost to the taxpayer. The Minister will be able to see why the people in the area are interested in airport expansion.
Integral to a sane airport policy must be a sane surface transport policy. That is why, yesterday, I pressed the Minister of Transport to make sure that the motorway system around Manchester was completed. It is lunacy not to have an efficient transport system to airports. I am disappointed that British Rail and the airport authority in Manchester have been slow about building a rail spur into

745
the airport. A rail spur into the the airport plus a comparatively cheap link to take the railway south of Manchester and link up with other railways going north and to Scotland would open up for this regional airport an enormous catchment area. The airport already has within 100 minutes' travelling time 20 million people and over half of Britain's industry.
That brings me to passenger capacity. The fearsome figure of 78 per cent. has again been trotted out. It has been put to me that it is slightly inflated, because it includes people stopping over in London because of lateness of arrival.
Mr. Tebbit indicated dissent.
Mr. McNally: Is that figure carved in stone? Airport industries seem to be content with an inertia that we would not accept from any other industry. It is an important growth industry, but airports will not be allowed to go on indefinitely staying where they are and developing complacency and inertia. We must have, as part of the strategy for regional airports, a tough line with airlines and tour operators. The airline business is a growth industry, but the growth cannot be unplanned and undisciplined if its benefits are to be shared by the nation at large. Unless the Minister is willing to contemplate hefty sanctions against over-use by operators, he will not achieve his objective.
I welcome the advisory committee's recommendations for a vigorous approach to licensing. I am also glad to hear from the Minister that many new routes have been negotiated. In addition, there is a need for a selling job. People abroad naturally want to come to London. We accept that London is a magnet for tourists and probably for business men. Is it too much to ask that we have an education programme along the lines of "Does your journey really have to be through Heathrow?" Far more information needs to be disseminated abroad about the travel time involved in going through Heathrow rather than through regional airports. Both Liverpool and Manchester are showing imagination and sales drive in a vigorous campaign. We need similar campaigns abroad. British Airways have a responsibility. They are not giving the back-up to the regional airports that they deserve in terms of overseas advertising.
746
The Minister should have talks with tour operators. Why cannot package tours be organised to depart from a regional airport and return through London, or vice versa? There are many variations that would not deprive tourists of the pleasure of visiting London. If the Minister had that attitude to tourism, he would achieve two objectives. He would help regional airports and spread tourism more evenly across the country. We want a good tourist industry, but it needs to be more evenly spread, and this is where two policies could meet.
We are trying to judge an airport strategy at a time when there are many imponderables. In an interesting article in tonight's Evening Standard the Secretary of State says that he has doubts about forecasts. We have had oil price rises. The new technology has had an impact on business travel. We do not know yet how well the improved rail network, the high-speed train and the completion of the motorway network will open up airports. Reference has been made also to the Channel tunnel.
I am left with two questions. One refers to the interesting debate that we have had about the South-East. As one who has been in and around politics for about 15 years, I have always suspected that somewhere in the Department there hangs a notice that says "You can have any third airport you like as long as it is Stansted". As Lord Pitt said in another place, the policy is now "Stansted by stealth".
Conservative Members are right to have doubts about that policy. They will find some strong allies from the regions on the Labour Benches. We do not like the laissez-faire approach of the Minister. We want him to go to the operators and airline authorities and say "You cannot have everything you want in the South-East." There is a powerful South-East lobby of Tories that has ganged up with the regional Members of Parliament, and unless we have a proper regional airline and airport policy they will defeat us. That would be a good message to send from the House tonight.
7.28 pm
Mr. Toby Jessel: I listened with great interest to the speech made by the hon. Member for Stockport, South (Mr. McNally). We should all like

747
more aircraft to be routed through Manchester, especially those of us with constituencies around Heathrow. Perhaps Manchester has a better prospect of this than some other provincial centres.
Until a few moments ago, sitting opposite to me in the Chamber was the right hon. Member for Battersea, North (Mr. Jay). Some time during the 1940s he, with three or four other people, in the space of three-quarters of an hour decided that London airport would be at Heathrow. I cannot help contrasting the way that that decision was taken with the decades of agonising anguish that we go through now on airport siting. Thank goodness the Government have had the courage to grasp the nettle.
Mr. Tebbit: I thought that my hon. Friend, when referring to the right hon. Member for Battersea, North (Mr. Jay), was about to comment on his vision as the orginal proponent of Stansted some years ago.
Mr. Jessel: I did not know that. I am not completely in favour of the angle of vision of the right hon. Member for Battersea, North. Unfortunately, he is not here to answer for himself. However, I wish that his angle of vision had pointed in a different direction.
My constituency of Twickenham comprises part of the 1½ million population in West London, mentioned by my right hon. Friend the Secretary of State, who suffer from aircraft noise. My hon. Friend the Member for Horsham and Crawley (Mr. Hordern) said that he would not detain the House in describing the suffering of people from aircraft noise. I am going to do so. I feel that the House should be reminded that although some people do not mind aircraft noise, many others suffer acutely from it. My right hon. and learned Friend the Member for Hertfordshire, East (Sir D. Walker-Smith) said earlier that people were "crucified" by aircraft noise. For some people that is no exaggeration. It can cause mental illness, it spoils people's quiet enjoyment of their houses and gardens, it interferes with the work of hospitals, schools and offices, and it interferes with people's private lives. I hope that not one hon. Member would wish to belittle the suffering that can arise from aircraft noise.
748
At Heathrow there are now 600 aircraft movements every day. We need a substantial reduction in aircraft noise. It is not sufficient to say that we should keep the status quo.
I regret the decision to allow the fourth terminal. I gave evidence to the public inquiry and argued against it for all I was worth. However, I fear that the decision of the Government to allow the fourth terminal has been made unavoidable by the decision in 1974 of the Labour Government to drop Maplin. We all know that Maplin will not now happen.
At the time I saw that as an appalling decision, as did Sir Colin Buchanan. In a letter to The Times on 9 January this year, he said:
"in 1974 Mr. Wilson's Government, in a fit of insanity, dropped Maplin, apparently hoping that the problem would disappear."
It has not disappeared. That is why we now see the travail of my hon. Friend the Member for Saffron Walden (Mr. Haselhurst). That was a terrible decision. If work had gone ahead then, Maplin could have been opened in 1982–83 and we would not have needed a fourth terminal at Heathrow.
The Liberal Party aided and abetted the Labour Government in their decision to drop Maplin airport. In that context, the official spokesman on environmental matters for the Liberal Party said tonight that he was prepared to go on record as favouring the notion of a fifth terminal at Heathrow. For a party that claims to care about the environment, it is monstrous to suggest cramming more and more aircraft through Heathrow every day, in adidtion to the 600 flights that already pass through it. Even if the number begins to diminish because of wide-bodied aircraft, that is not sufficient. We need a rapid diminution, and we certainly do not need a fifth terminal.
Will my hon. Friend the Under-Secretary of State say a little more on the question of a fifth terminal in his reply? The Secretary of State said on 17 December that the Government did not favour a fifth terminal. On 4 February my hon. Friend the Under-Secretary said, in reply to a supplementary question, that the Government had reached the conclusion that it would not be right to go ahead with the fifth ter-

749
minal and that nothing that he had heard since had caused him to change his mind. I hope that he will now say that the Government have no intention of allowing the construction at Heathrow to go ahead. My hon. Friend the Member for Putney (Mr. Mellor) and Lord Boyd-Carpenter in another place have both expressed anxiety at the lack of certainty. It is a worrying matter.
Dr. Glyn: My hon. Friend will be aware of a letter that I have received from British Ariways, which is somewhat misleading in its approach to the fifth terminal. It is now even more important that the Government should make it clear that it is not an alternative to stage 2 of Stansted.
Mr. Jessel: I could not agree more. I deplore the campaign by British Airways on this matter. I say that as one who is second to none in his admiration for British Airways. It is one of the finest airlines in the world. I travel quite frequently on it, and many of my constituents work for it. I have met several members of its board, whom I personally admire. That is why I was astonished to receive not only the letter to which my hon. Friend the Member for Windsor and Maidenhead (Dr. Glyn) referred but a glossy pamphlet produced by British Airways. I received it through the post and I presume that all other hon. Members received a copy, including yourself, Mr. Deputy Speaker. I immediately turned to the part referring to aircraft noise, where it was stated that if there was a fifth terminal at Perry Oaks there would be no significant increase in aircraft noise. That is not good enough. We need a substantial diminution in noise.
Mr. John Wilkinson (Ruislip-Northwood): To be fair, the British Airways pamphlet points out that by the early 1990s, which is when the fifth terminal could come into operation, aero engines will be quieter and there will be no extra noise. In fact, there will be a reduction of the noise nuisance to people who live around the airport.
Mr. Jessel: My constituents object not only to the average loudness of each flight but to the number of flights. They do not want a continuation of the status quo; they want a substantial reduction both in the number of flights and in the amount of noise.
750
I wonder whether I am alone in feeling that it is wrong for the boards of nationalised industries to spend large sums of public money producing glossy leaflets to campaign on policy issues. It is not their province; it is for Parliament and the Government to set the framework within which these industries operate. British Airways would be the first to accept rules on traffic and safety control just as there are rules on safety in factories. Surely Parliament has a duty to set limits to aircraft noise. It is the job of Parliament and the Government to balance commercial interests, whether nationalised or private, with the peace, health and quiet of people. It is the duty of a nationalised industry board, such as that of British Airways, to accept the framework set out by the Government and Parliament and not itself to bang about on policy issues. British Airways must do the best that they can within the framework set out by Parliament and Government.
Mr. Shersby: Is my hon. Friend aware that, in considering access to the fifth terminal, British Airways states in its document that the access would be by a spur, which would give access to the high-grade roads direct to central London, and thus enable traffic to be dispersed on the through motorways, including the M4? Is he further aware that those proposals involve widening the M4 to within 10 ft. of the windows of my constituents in West Drayton? That is the extent of the additional damage to the environment that would occur if the fifth terminal were approved.
Mr. Jessel: I am grateful to my hon. Friend for his comments. That is the sort of letter that we should take into account. British Airways could not take that into account. They are specialists. They cannot look at the overall environmental aspect. It is not their job. They are not competent to do so, and they should stick to running aircraft, which they do extremely well.
7.39 pm
Mr. Sydney Bidwell: I am conscious that hon. Members, particularly on the Conservative Benches, are under pressure from their constituents and are keen to ventilate their points of view. My constituency is close to London airport.

751
I congratulate my hon. Friend the Member for Stockport, South (Mr. McNally) on applying his mind to the necessity for a balance in airports policy on a conscious regional basis. He exposed a central weakness, although it is not just the present Government who are responsible. There has been a lack of advanced thinking about the need to expand facilities for aircraft to land and take off. It is, of necessity, a developing situation.
The hon. Member for Twickenham (Mr. Jesse]) has always been diligent about environmental repercussions for his constituency. He said that West London, to put it crudely, has had a basinful. When the fourth terminal was mooted, there were vigorous protests.
There is a conflict in my constituency. The hon. Member for Horsham and Crawley (Mr. Hordern) strongly argued the environmental case and opposed the creation of a second terminal at Crawley. He told the House about the views of local industrialists in the Crawley new town area, but he did not tell us about the views of the trade unions or those who work in the industrial area of Crawley. We have to strike a balance, and I imagine that the Department has to consider all views.
It is not a dream of the future. It requires sound consideration of what will happen in the next five or 10 years. I understand why we are in this situation.
I wish to deal with the amalgam of considerations. The Department tells us that it is trying to diminish the noise, but we take that with a pinch of salt. We shall believe it when we cease to hear it. The flight path of aircraft from Heathrow is mainly over Twickenham and Windsor. It is understandable that the hon. Member for Windsor and Maidenhead (Dr. Glyn) intervened. His constituents are the most afflicted. With a prevailing south-west gale force wind, flights in and out of the airport change direction. My constituents in the Ealing area then become acutely aware that they live close to the airport.
It is curious that, when a fourth terminal at Heathrow was proposed, we had protests similar to those that the hon. Member for Twickenham voiced tonight, and we had workers or trade union rep-
752
resentatives saying that the provision of jobs came first. I have grave doubts about what happened in British Leyland over Derek Robinson. His is a harsh fate. Nevertheless, it demonstrates the thinking of working people—jobs and livelihood first. That principle has affected the thinking in the area over the fourth terminal.
I opposed the provision of yet another terminal in the Perry Oaks area, which was the area originally proposed for the fourth terminal. That has now changed.
As most other hon. Members have done, I wish to plead my constituency case. The other night I raised on the Adjournment my anxiety that we should not have too much altercation over financing the Hayes bypass, which is necessary not only for Hayes but also Southall. The roads are bunged up with commercial traffic and there is now the certainty of a fourth terminal, which will require even better road access.
In the inquiry and inspector's report, reference was made to the need to encourage workers at the airport not to clutter up the roads with their cars. If all the airport workers travel in their own car, more parking space is also required at the airport. There is a need to provide decent public transport around the clock, on good roads, which will encourage those workers to use it. I am a member of the Standing Committee on the Transport Bill, and I support that idea.
We should have no financial wrangling over whether the GLC should fit the new bypass into its budget or whether the Minister of Transport has to upgrade the road, as the inquiry suggested. It is going ahead, and we should have no buck-passing. The Secretary of State for Trade and the Minister of Transport should get together over the matter. The bypass should go ahead as soon as possible. The road scheme should be well advanced on both sides of Heathrow airport before the airport enlarges its capacity. There are other major road developments concerning which there is no haggling over expenditure. We are asking the Minister of Transport to meet a delegation of local Members of Parliament about the question of this vital bypass. There is considerable local concern.

753
In my constituency, I have a higher than average number of people of Asian origin. Many of them work at the airport. Some of them work for airlines. Those who work for the British Airports Authority do not get free or concessionary travel across the world. Many of them are keen to work for Trans World Airlines in order to travel to their lands of origin, and they have an unusual interest in airport expansion.
There is a conflict. The people of Stansted have my full sympathy. From time to time I have supported my hon. Friend the Member for Harlow (Mr. Newens). It cannot be argued that jobs are needed there.
In West London and Middlesex, we have had a rundown of manufacturing industry. On balance, therefore, the fourth terminal is accepted. Environmentalists oppose it and write to me along those lines, but trade unionists do not. I attended a district meeting of the Transport and General Workers Union. They are concerned about job preservation in the area.
7.49 pm
Sir Bernard Braine: I believe that hon. Members know that for the past 15 years I have been engaged in almost perpetual conflict with successive Governments over a variety of assaults on the environment of my constituency. It was, therefore, with a sense of great relief that I heard my right hon. Friend's announcement on 17 December not to build a new international airport of the kind envisaged by the Roskill Commission in 1971 and not to resurrect the Maplin project, even in revised form. That was a wise and courageous decision and I applaud it. There is certainly no case for a major new international airport. There is a case for making more intelligent use of existing airports, as was shown in the reports of the Study Group on South-East Airports and the Advisory Committee on Airports Policy.
It is always pleasant to have one's opinion endorsed even though, as in this instance, it happens many years after the event and several Parliaments later. Those of us who represent constituencies in the area that lay under the shadow of the Maplin project, such as myself and my hon. Friends the Members for Maldon
754
(Mr. Wakeham) and Canterbury (Mr. Crouch), are profoundly relieved by the Government decision. It is sad that our late and much-loved colleague, Sir Stephen McAdden is no longer with us to say this for himself. I do not think that any man had a more doughty ally in the battle that we were fighting than I and my hon. Friend the Member for Maldon had in Sir Stephen.
Why do we feel so strongly about this? We were going to have a massive new town in the narrow peninsula wedged between the Thames and the Crouch. We, too, were going to have communication problems in an area with the worst corn-muter services in the country. The flight paths of the proposed airport were to pass close to a nuclear power station at Bradwell in the north and over the largest munitions wreck in the country—perhaps in Europe—in the Thames estuary. There were many reasons why Maplin was a bad choice, and I shall say more about that in a moment.
I have a great deal of sympathy with those in North-East Essex who face expansion at Stansted. It is no comfort to them to know that the expansion will be limited. None of us could fail to be moved by the speech of my hon. Friend the Member for Saffron Walden (Mr. Haselhurst). He spoke well for his constituents. And who could have failed to have been impressed by the powerful speech, on somewhat different grounds, of my hon. Friend the Member for Horsham and Crawley (Mr. Hordern) or by the moving appeal, made not for the first time, by my hon. Friend the Member for Twickenham (Mr. Jessel)?
If I intervene it is because I detect, in some of the things that were said, especially by the hon. Member for Harlow (Mr. Newens), that there is still a lingering feeling that Maplin should be the site. That is the implication behind some of the speeches we have heard. The Greater London Council says so openly and so does the Essex county council. They say that Maplin should be selected not because it is the best site—that is not the argument—but because it is the only coastal site.
Because Maplin is the only coastal site ever considered, some people believe that we should choose it now. It needs to be said that there is no logic or reason in

755
that conclusion. I say for the benefit of those who entered the House in recent elections that the way in which an earlier Government handled the matter is a classic example of British administrative muddle and incompetence. Once the initial misjudgment had been made, instead of starting again, error was piled upon error because the mandarins would not admit that they were wrong.
What happened was that the Roskill Commission was given the wrong terms of reference and it interpreted what it was given too narrowly. I say this with specific reference to the speech that we heard from the hon. Member for Bristol, North-East (Mr. Palmer). Roskill was given an area of search which went within 10 miles of the Wash and 15 miles of the Severn estuary. Parliament did not decide this. Some civil servant drew a circle round Heathrow which excludes coastal sites within reasonable air distance of London and better placed in regard to the industrial Midlands than Maplin. Coastal sites were thus deliberately excluded by those who briefed the Roskill Commission.
That was a scandal and it led to massive errors in public policy and a massive waste of public money. It is the reason why we are discussing this matter here today years after the right decision should have been taken. The right decision has been taken now, but we are here today because of the stupidities committed at that time.
The Roskill Commission looked at 78 four-runway sites. It rejected 74 of those sites within two months and spent two years looking at four sites, of which only one—the civil servants had made quite sure that there was only one—was a wasted site, Maplin. At the end of the exercise Roskill rejected it. But then public opinion, not very well informed, decided that Maplin it had to be and the Government fell for it. That is how the decision to impose Maplin upon the nation was carried. The Labour Government were quite right to abandon the idea when they did. Let us not repeat those errors.
Thank goodness that my right hon. Friend the Secretary of State, who brings great imagination, energy and zest to his job, learnt that lesson. I listened with the greatest of interest to his speech this
756
afternoon. It was lucid and, comprehensive and completely convincing.
I intervened in the debate solely to say that there is no case for Maplin. It is too remote, it is in the wrong place, and it is too costly. This time the Government have got the decision right. I hope that its implementation will not be long delayed.
7.57 pm
Mr. Geoffrey Johnson Smith: Unlike my hon. Friend the Member for Essex, South-East (Sir B. Braine), I am sorry that we did not choose Maplin. I thought that it was very enlightened to have something over the sea. We all argue about green field and inland sites and I think that the problem would have been solved had we chosen Maplin. But that is history. It is all finished with and we are stuck with this wretched problem, and my right hon. Friend has my greatest sympathy.
There was one thing that I did not like about my right hon. Friend's speech, and that was his essay on free market economics. He said that we must allow market forces to work in the aircraft industry. Of course, they must be allowed to work in that area to some extent, but we are dealing with public investment, planning laws and the environment, and I should have thought that my right hon. Friend would have been the first to admit, as he is a compassionate and sensitive man, that market forces must respond to social disciplines.
I gave notice to my hon. Friend the Member for Woking (Mr. Onslow) that I would take issue with him about Sir Freddie Laker. How dare we challenge that gentleman's judgment? My hon. Friend argued about whether Manchester was a good place from which to fly, saying that if it was such a good place Sir Freddie Laker would have gone there. I can tell my hon. Friend why Sir Freddie Laker does not operate from Manchester. It is because Gatwick is expanding. It is a brand new airport which has a great future. I am delighted that it has such a future. Sir Freddie Laker would need his head examining if he went to Manchester, especially when there is so little encouragement for anyone to operate from a regional airport.
However, there is no reason why an entrepreneur should not be persuaded by

757
wise Government policies and incentives to move to Manchester, and one day I hope that will happen. I do not want to be parochial about Gatwick because, as my right hon. Friend will know, I think that its development has, on the whole, brought enormous economic benefits to the nation and it has certainly been good for local employment. In terms of the cost of the price of Gatwick compared with the gains to the environment, we have come out winners so far. There is a 9 million throughput of passengers and we can go to 16 million with one terminal and one runway. However, the airlines and the BAA want it all their own way. They say that more people want to come to the London airports and, therefore, they want two terminals and a throughput of 25 million passengers. That is not far short of the size of Heathrow.
Not one Member of Parliament in the area disagrees with the increase to a throughput of 16 million, but we all disagree, together with the big local organisations, with the 25 million throughput. There must be a reason for that. We are not middle-class Luddites who do not want industrialisation. My hon. Friend the Member for Horsham and Crawley (Mr. Hordern) spoke of the influx of industry into this corner of England. It is one of the most prosperous areas of Britain. That is not because we have green fields—although they play a part—but because we have modern technology. We like it and we want to keep it that way.
The proposal on Gatwick not only affects the existing industry. If the airport is allowed to expand, not only will the infrastructure be ruined because of the attractions of the airport but other areas of the country will be ruined because the airport will suck in labour. If we are to expand to 16 million, the additional labour force that will be required will be about 13,000. If the airport expands further—we are told that it must—we shall need an extra 18,500 employees. All that is in an area with a shortage of skilled labour, a low unemployment rate and a carefully developed and thriving industrial and commercial infrastructure which is export oriented and technologically advanced.
We should be looking to other parts of Britain that are less economically favoured for huge injections of capital by both the private and public sectors
758
that are associated with airport development. Why must we always look to the development of the South-East? I know that further development must take place, but the tone of the statements from the Department of Trade and the BAA is that we must not only expect further development but that we must have it to solve the problems of the South-East. The BAA says that 78 per cent. of passengers using Heathrow or Gatwick start or finish their journeys in London or the South-East. It is a self-fulfilling prophecy. Of course, that proportion use the airports of the South-East because the facilities elsewhere are non-existent or inadequate. London has been allowed to dominate air travel, as it has dominated so many other aspects of national life
In no other country does the national capital play such a dominant part to the point that the growth and diversity of life in the regional cities has been grotesquely stunted over the decades. The BAA and the airlines threaten that traffic will go to other countries unless the demand is totally satisfied in the South-East. They say that people from abroad will not come here any more for their holidays and that poor old London will be driven to becoming a mere tributary and feeder airport for Frankfurt, Paris and Schipol.
I am not impressed by that argument. America has successfully created other gateways within the country. Why cannot we do the same? We no longer have to suffer the awful travail of going through Kennedy airport, with the inevitable stacking that takes place and the hours that one spends getting out of the wretched airport. The Americans recognised that fact long ago. Why cannot we do the same?
Most of the growth in air traffic has been in leisure traffic. Tourists, many of them with knapsacks on their backs and flying with Laker Airways, do not always have to fly into London. They can visit other main tourist attractions first and travel later by road or rail to the capital city, where, no doubt, many of them wish to go as it is the Western form of a visit to Mecca. Fortunately, the regional airports in the Midlands and the North-West are close to areas which are popular with tourists and connected to the capital city with a fast inter-city railway that is one of the most efficient in the Western world.

759
Britain is a small island, and hon. Members who talk about the terrible journey of two hours and about 80 or 100 miles from London forget that the tourists come from countries which are three or four times the size of Great Britain. France alone is two and a half times larger than Great Britain. It is no great infliction for the tourists to make that sort of journey. Distance is no object, and I see no overwhelming economic reason for desecrating even more of the South-East countryside, adding to the growing strain of the tourist facilities of the capital—that is what will happen if the BAA and the airlines have their way—and upsetting the developing industrial structure of the South-East.
Such a policy flies in the face of a rational and profitable tourist trade which seeks to encourage visitors to prolong their visits outside the congested capital. It is short-sighted of the airlines, as anyone who has seen the crowds of tourists shambling in their droves outside this place and on their way to Buckingham Palace will testify. London is becoming increasingly tourist saturated.
I urge the Minister to look again at the forecasts of air traffic and to recognise that we have more time than is suggested by the advocacy of the BAA. We have the opportunity to develop a real national airports strategy which will take into account the long-term needs of the tourist industry, the airlines and the regions of Great Britain.
I shall refer to some statistics, but I shall not bandy too many across the Floor of the House because I know that they are difficult to follow. However, my right hon. Friend is an intelligent man and I ask him to consider some facts concerning the growth of air traffic. Page 58 of part 2 of the consultative document on airport strategy for Britain which was published in January 1976 said that a throughput of up to 12 million passengers by 1990 might be conceivable at Manchester airport. That is twice what is proposed in the White Paper and in the most recent document. Nobody could deny that if Manchester and Liverpool airports were jointly managed an air traffic complex there could make an enormous difference to the development of air traffic in the regions. However, the
760
BAA says that the time scale does not allow for such plans to be considered.
I hope that a further set of figures will persuade the Minister that he has more time than he believes to consider the proposal and other proposals to develop regional airports before the capacity in the South-East runs out. In the advisory committee's report, at chapter 7.2, we are told:
"Taking account of planned capacity we have concluded that the effective capacity of the existing four London airports at Heathrow (with four terminals), Gatwick, Stansted and Luton by 1990 could be around 65 million passengers a year".
That is true. It does not allow for new planned capacity at Stansted—it does not allow for more than an increase of 4 million or 5 million. If the capacity at Stansted were increased to 16 million, the capacity of the London airports would be about 75 million. The same report says:
"By 1990 air traffic demand in the London area could be within the range 69 to 81 million passengers a year."
That forecast is not so different from the White Paper forecast of 1978, where the calculations were based on a 15 per cent. rise in fuel prices by 1990. In the last year, fuel prices have risen by 100 per cent. I should have thought that it would be fair to take the forecast at the lower end. As my right hon. Friend knows, within the London airports it is possible to develop, without two runways at Stansted, a throughput of 65 million to 70 million passengers a year.
Would not that give my right hon. Friend the opportunity not to rush blindly into a second terminal at Gatwick with a capacity of 25 million? Does it not enable my right hon. Friend to let off the hook the people at Stansted who are worrying that if the capacity is increased to 16 million in one year it will be just a few more years before the planners come back and gobble up more land and ask for an airport with a capacity of about 50 million? That is what we are worried about at Gatwick. We have been assured by the Government that it is an overflow airport. If there was fog at Heathrow, the aircraft were diverted to Gatwick.
They thought that they could develop all the facilities without proper planning permission. It is little wonder that they woke up one day and said "We put so

761
much public money into the airports that it is in the public interest that it should be allowed to expand to take 25 million passengers."
We are very suspicious about the way in which it is being handled. It does not add up to a national airports strategy. My right hon. Friend has rather more time than he believes. I hope that he will bear in mind that it is one of the last major industrial pieces of public capital investment that is left to the Government, or any Government in the twentieth century.
There are many regions in Britain that have declined because of their dependence on heavy industry. That is why my right hon. Friend the Secretary of State for Industry has to argue with his Cabinet colleagues about how much money he will be able to give to the declining regions, We are suggesting a rather better solution. Surely it makes sense to bring those areas into the twenty-first century, revived and rejuvenated with the skills and technology of modern aviation.
8.11 pm
Mr. Graham Bright: Now that the reports of the two advisory committees have been published, we can see the implications of choosing Stansted as a site for expansion. That concerns my constituency as it would be especially affected. There are more than 6,500 people working at Luton airport, which makes it the second largest employer in the town. It is an outstanding example of a local authority enterprise. We have an enviable profit record of about £1·5 million for last year.
The growth of charter traffic from Luton is a guarantee of the town's future prosperity. I welcome the assurance given by my right hon. Friend the Secretary of State for Trade when he replied to a question in December that Luton airport could continue to expand for some time. He imposed a limit of 3 million passengers.
I am not prepared to accept, in any circumstances, the prospect that Luton airport might have to close in the longer term if Stansted expands beyond a certain level of air traffic. The loss of jobs would be intolerable to my constituents.
The threat to Luton airport's future is said to spring from the air traffic control problems that would arise when Stan-
762
sted was handling many millions of passengers. The problems are not insoluble. Since December, Luton borough council and the Civil Aviation Authority, together with the national air traffic control services, have been discussing air movements from the two airports. I understand that there would be no problems until air traffic movements from Luton and Stansted exceeded 120,000 a year.
That figure of movements would mean about 3 million to 4 million passengers a year through Luton and 16 million through Stansted. Sixteen million is the figure that many are considering as suitable for Stansted. If the 4 million passengers from Luton are added, it gives a total of 20 million. Even if the figure were to rise above that, I believe that the problems could be resolved. There would be no technical requirement for Luton to close.
I ask my right hon. Friend the Secretary of State for a categorical assurance about the future of Luton airport. There is no reason why it should not continue to operate for the benefit of the town, even if Stansted were to become a major airport.
The growth of charter traffic from Luton airport shows what regional airports can achieve. Too little emphasis has been placed on that role when considering airports policy in the recent past. I believe strongly that they will have a larger role to play in the future. Britannia Airways, based at Luton, operate from 22 regional airports in Britain. They are planning to capitalise on the position by providing further services to meet consumer demand. I emphasise "consumer demand" because it is the commercial judgment of a successful airline.
Quite apart from the justifiable doubts about fuel prices and passenger traffic forecasts for the 1980s and 1990s, it may be more difficult to encourage the use of Stansted than anyone has realised. Stansted already has the lowest landing fees of any airport in the London region. It provides free car parking. However, its passenger traffic is 300,000 passengers per year only.
It has proved difficult to persuade airlines to move to Gatwick from Heathrow. It is likely that they will be equally reluctant to move to Stansted. Many of my constituents strongly suspect that the

763
BAA wishes to capture the lucrative charter traffic now passing through Luton. I seek a specific assurance from my right hon. Friend that the BAA will not be allowed to draw off that traffic by subsidising Stansted at the expense of Gatwick and Heathrow. If Stansted is to be developed, it must be an economically viable prospect in its own right.
I doubt whether a decision must be made now. The forecasts on which so much reliance has been placed are subject to wide variations. The full cost of choosing Stansted, taking into account all the homes, schools, hospitals, roads and other facilities that would have to be provided, appears to be too great to be borne, especially when the loss of agricultural land and the environmental nuisance of an inland site are taken into consideration.
We have the capacity and the will at our regional airports to take up the growth in the tourist traffic for the foreseeable future. That is an area that we should seek to expand.
8.18 pm
Mr. John Wilkinson (Ruislip-Northwood): I must declare an interest as a director of an air transport company that operates from Stansted, among other places. I viewed the debate with some misgivings because I feared that the air would be heavy with the thunder of hobby-horses' hooves and the grinding of axes. Luckily, it has not turned out that way.
My right hon. Friend the Secretary of State made a thoroughly commonsensical statement which will receive much approval in civil air transport circles. I congratulate him on his wholehearted support for civil air transport. I congratulate him on his encouragement of the full use of regional airports. I congratulate him especially on his determination to pursue as flexible an airports strategy as possible to meet the thoroughly unpredictable development of air transport demand.
It is vital that we fully support civil air transport. Industry in this country is failing, and civil air transport—especially in West London—produces stable employment with jobs for many people. My right hon. Friend quoted a nationwide figure of 100,000 who earn their livelihood in civil air transport. It behoves
764
our Conservative Government to encourage an industry that has proved itself so enterprising and successful as British civil air transport has over the years.
We should not forget that civil air transport exists to serve the travelling public to meet their requirements and not necessarily the requirements of committee men and planners. It also exists, as my right hon. Friend reminded us, to meet the growth of air cargo, which is becoming an important sector.
I find it noteworthy that the Civil Aviation Bill is passing through Committee at this time. The Bill contains proposals to allow an injection of private capital into our flag carrier, British Airways. It would be wrong if our airports policy were to do anything to the detriment of the commercial interests of British Airways. I refer especially to any suggestion that British Airways' operations should be forced to move to an airport not of its choice.
Our existing airports are a great national asset. It astounds me that in this country, of all countries—which is literally riddled with airports and airfields, many of them a legacy from the Second World War—we should even contemplate the desecration of virgin country by the development of a green field site or the desecration of the wild and wonderful coastal country at Maplin.
In these circumstances, I think that the proposal to develop Stansted, at least to its first stage, is common sense. I regret the foreclosing of the option for the development of a second runway at Gatwick, but I understand that that will please many local inhabitants and, not least, many of my hon. Friends. However, I do not think that we should rule out totally the possibility of a fifth terminal on the Perry Oaks site at Heathrow airport.
As a member for the Hillingdon borough, in which Heathrow is situated, I must emphasise as strongly as I possibly can that the question of a fifth terminal at Heathrow is just not on unless the whole infrastructure of surface communications is put in first. There would have to be access to the M25 motorway. There would need to be a widening of the M4, as well as an extension of the Tube and an extension of the British

765
Rail link. All those things must come first. However, I do not believe that that option should be foreclosed at this stage.
I argued and voted against Maplin because I always believed that at a time when airliners were becoming more and more house-trained and when they were becoming quieter it was total nonsense to move airports at immense public expense further from the centres of population. This is now particularly true at a time when fuel costs and public expenditure considerations make it more necessary to bring airports closer to the demand. When I was sales manager of the company of which I am now a director, I had to advise where its main operational base should be. I decided that it should be at Stansted. I did so because I knew that Stansted would probably be the main airport for the City of London, for the East End of London, for the new dockland zone, which will grow in commercial importance, and for the northern sector of London as well. I believe that, at present, those areas are ill served by airline services. I trust that when Stansted grows airlines will move there, not just charter or cargo airlines, but scheduled services as well.
The House should not think that I am unconscious of the beauty of Stansted. I have worked there as sales manager of a charter company, and before that as chief flying instructor of a flying school. I remember the hares beside the runway, the mushrooms in the grass in autumn, the blackberry bushes and the rabbits around the perimeter and, not least, the quiet country pubs to be visited when the hangar doors were closed.
8.23 pm
Mr. David Mellor: I am grateful to you, Mr. Deputy Speaker, for calling me and I shall endeavour to be brief so that others of my hon. Friends can speak.
All good things must come to an end. I very much hope that this debate marks the end of the great deal of talking and inquiring that has gone on over the years and that perhaps we are beginning to move towards the firm action which will be needed to meet the growth in air transport that is scheduled over the next 20 years.
766
It was as long ago as March 1964 that a report of the then Conservative Government concluded that
"Stansted be selected and designated as London's third airport. The Government believes that this is the right choice".
With a degree of bipartisanship which, sadly, has not always been repeated, that report was adopted by the Labour Government. Indeed, as late as June 1967 the right hon. Member for Battersea, North (Mr. Jay) stated in a long speech the reasons why Stansted was the right choice. That speech perhaps reads better today than it did then, because almost everything that the right hon. Gentleman said about Stansted was right. Indeed, one wishes that most of the Government pronouncements at that time had worn as well, but, as we all know, they did not.
Sadly, within a few months the right hon. Gentleman had gone to the Back Benches, in came Roskill and everything took an unhappy turn which has led inexorably to the sad situation which my right hon. Friend has had to take up.
Some hon. Members are probably very pleased that it was all jaw-jaw but very little action during those years. They have their own constituency interests, which, of course, dictate that they must take that view. But what has been the effect of the delay? In a constituency such as mine, it has meant the build-up of more and more traffic passing over the roof tops. Even with the advent of wide-bodied jets, our failure to get on with the job of providing more airport facilities elsewhere has meant that 30,000 more air movements a year now take place over my constituency than a decade ago. Throughout the day, aircraft remain four miles apart and fly over every 90 seconds. The difference between the noise levels of the wide-bodied jets and the Boeing 707s is a pretty academic one when, like my constituents, one is trying to hold a conversation in the Upper Richmond Road.
The record for flying over Putney occurred five years ago, and I trust that nothing that is done in the House will force us to go back to that time, because then 74 jets in one hour passed over our heads. However substantial the constituency interests of other hon. Members may be who do not want the Government to take the action that is proposed, I do not think that they can inflict much more of that on the people of London.

767
Every aeroplane which cannot land at Stansted is an aeroplane whch must fly over 1½ million people to get into Heathrow, and that is simply not good enough. London has endured enough, and we cannot be expected to endure more.
While I obviously regret that my right hon. Friend had to say that the fourth terminal should go ahead—I accept that that was something of a fait accompli which he took over from the previous Administration—I am grateful to him for what he said about the fifth terminal. I am glad to know that that appears to be a bipartisan policy. However, I am sure that many of my constituents will be surprised to learn that the Liberal Party's policy appears to sanction the fifth terminal at Heathrow. We shall ensure that that is widely known around certain districts where the Liberals have certain electoral aspirations.
I entirely support what my right hon. Friend said about the movement to Stansted and Gatwick, and the building of a second terminal at Gatwick. But there is one point that I should like to raise with him. That is the question of urgency. It has been said that the situation is fluid. Indeed it is. But it is fluid only to a certain extent. I wonder whether we are not perhaps a little optimistic in thinking that some of the forecasts of the build-up of air transport over the next decade are likely to be optimistic. It is true that at the time of Roskill the forecasts were wildly wrong, but since 1973 the forecasts have become very accurate. Indeed, I raised this matter with the British Airports Authority. It is right to say that the forecasts it made in 1975 for air traffic in London in 1979 were right, with only a margin of error of 4 per cent., and that was 4 per cent. understated rather than overstated.
The British Airports Authority carries out forecasting on a contract basis for four leading Continental airports, namely, Paris, Zurich, Frankfurt and Amsterdam. Over the same period, the maximum error in its forecast was 3 per cent. For two of those airports its forecasting was spot on. An estimate has been given of 69 million to 81 million passengers a year by 1990. That is a fair estimate. Oil prices will not affect it.
I shall make a point that was put with far more clarity in the other place by
768
Lord Boyd-Carpenter a fortnight ago. He said that there had not been sufficient urgency in implementation. As he pointed out, what will happen if the result of the public inquiry about the second terminal at Gatwick goes against the Government? That point was put to Lord Trefgame in the other place, but he would not commit himself. Lord Boyd-Carpenter said that if the Government were not prepared to overrule the inspector, the effect of any refusal to approve a terminal would leave the Government's policy of taking traffic away from Heathrow in ruins. The Minister replied that that was certainly so. Is it, therefore, right to go through with a public inquiry at Gatwick or Stansted? We should bear in mind that a considerable amount of water has flowed under the bridge and that there have already been several other inquiries.
Perhaps it should be a political decision. Perhaps Ministers should say that they have taken a decision after considering all the evidence. Perhaps it is not a matter to be dealt with within the planning procedures. A highly desirable and courageous precedent was set by the right hon. Member for Battersea, North. On 29 June 1967 he said:
"After all the investigations which have already been made, there is no more case for handing this decision over to an outside body than there is on the Government's decision on the level of pensions, or the level of Income Tax, or, for that matter, the level of defence expenditure".—[Official Report, 29 June 1967; Vol. 749, c. 804.]
Those courageous words can properly be repeated today. As a result of the delay and of all the shilly-shallying of the past 15 years, there is now a need for urgency in the implementation of any decision.
The worst thing that could happen would be a recommendation of certain material points. I came here this afternoon confident that the question of the fifth terminal at Heathrow had been totally thrown out of the window. I hope that there were no equivocations—even of the remotest type—in the observations of my right hon. Friend. Such equivocation might lead me and at least one and a half mllion Londoners to feel that once again we had become the butt of airport policy. The problems posed by air traffic should be more evenly distributed, not only in the South-East but throughout the country.
8.32 p.m.
Mr. Iain Mills: I hope that my colleagues will forgive me if I disagree in part with many of the comments made about the apparent need for the Government to adopt a stronger regional policy on the diversion of traffic away from the South-East. Those hon. Members who have constituencies in the South-East may think that regional airports are a magical way of reducing traffic. I was pleased that my right hon. Friend the Secretary of State gave some reassurance on that point.
Some regional airports are undoubtedly suitable. As has been suggested, some of them want increased traffic and are suited for it. Some hon. Members may wish to convince us that they want an airport, but Birmingham does not. There are fundamental physical restrictions that are unique to Birmingham. I know that hon. Members are fond of saying that their constituency interests are unique. Perhaps they are loyal and honest and perhaps they are jusitfied.
Birmingham airport began in the 1930s as a small grass field. Unfortunately, the site chosen was unsuitable for further expansion. Those who have used Birmingham airport will have been appalled at the facilities. I am sure they have been astonished at the nearness of roads and houses. A road ruins within 10 or 20 yards of each end of the runway. Expansion has been suggested. I have been through the time-consuming and painful process of a public inquiry. Thousands of my constituents wrote to me. We have had all the panoply of a lengthy and detailed public inquiry concerning the future of Birmingham airport.
If that goes through—and the matter is being considered now, as my right hon. Friend has confirmed—it will mean a taxiway which will be used permanently to service the runway, running within 100 to 200 yards of people's houses. I ask the hon. Members to consider this. Even with acoustic screens and earth mounds, it is still appalling to imagine a huge aeroplane of the size of the BAC Super 111 100 yards away at the bottom of one's garden. That is not inconsiderable for both the eardrums and the general enjoyment of life.
I have made my view quite clear locally to my constituents and would like to put it on record here. The facilities at the airport are appalling and must be
770
improved. I believe that the naturally generated growth of the area must be catered for. It does not seem impossible that in this day of technological skills some equitable solution or compromise can be achieved. Those of my constituents who are opposed to an increase in the intrusion of airport activities into their lives are really opposed to the intrusion and not the activities. If that intrusion can be minimised, a solution can be found.
A policy of natural growth generated by the locality and its industrial, social and leisure needs should be the key element in dictating the size of Birmingham airport and its new facilities. I strongly suggest that the Government's decision on the amount of traffic that a regional airport such as Birmingham can bear should be influenced by these considerations.
It is the fear of some of my constituents that the planned expansion, already under public inquiry, will allow Birmingham airport to take services and passenger traffic that are not generated locally by the needs of the area and, therefore, do not represent true natural growth. Innovative marketing schemes, future low-price fares and the desire to offer more diverse desinations from central England could easily lead to an escalation in traffic, derived from a positive marketing approach or from Government direction. I must say that I find the words "integration" and "planning" in relation to transport and traffic more associated with the Labour Benches than Conservative Benches, where the freedom of choice is all-important.
Therefore, it is vital for the Government to recognise the special need of Birmingham for the absolute physical and fundamental limitations of runway and area and nearness of houses to be a major consideration for Government policy in the future decision on just how and where regional airports should take the extra load. The Government should consider whether, if the closeness of houses to the runway continues, there should be a continuation of night flights which are a hangover from the industrial practices of the last century. People should not have aeroplanes revving up a few hundred yards away while they are trying to sleep.
I should be grateful if my hon. Friend the Under-Secretary would give me

771
slightly more reassurance that further inflation of traffic figures will not be considered by the Government beyond the present 2·3 million or 3 million a year by 1990, which is at present the subject of a public inquiry.
8.38 pm
Mr. Michael Colvin: I welcome the fact that this is a debate about national airports policy and not about London's third airport, although I understand and forgive those hon. Members who would like to turn it into the latter.
Last December, when the Secretary of State made his airport policy statement, he began by saying that it was the Government's policy first to encourage the fullest possible use of regional airports and secondly to provide adequate capacity, as traffic developed, at existing airports in the South-East. I think that he has his priorities absolutely right. It has been interesting to hear during this debate that while the loudest voices in the South-East say "No" to airport expansion, there are some from the regions who are making what can only be described as "come-hither" noises. Most regions appreciate the value of an airport to their local economy. This is something that the Government must encourage. But how will they do this?
There are already 1,500 routes agreed by the Department of Trade between our regional airports and points in Europe, yet fewer than 100 of these are being operated. Are the Government engaged in a bit of wishful thinking? Is it too much to expect that mere exhortation alone will persuade the operators to move to the regions? I believe that there must be a combination of the carrot and the stick. Even the most dedicated free market economist must agree that some degree of State direction is required if our regional airports are to achieve their full potential as part of the national economy.
Regional airport development alone will not reverse the need for more terminals and runways in the London area, but if some flights, particularly freight and charter traffic, can be diverted nearer to their original, or final, destination, pressure could be taken off the London area. Road congestion would be eased. There would be better returns from the investment already made in regional air-
772
ports. It is important for the Government to act positively to encourage this development. This means putting their money where their mouth is. It also means backing winners and not losers.
We have an example in Bristol of a local authority airport, Lulsgate, to which my right hon. Friend the Secretary of State referred. My right hon. Friend also referred to Rhoose, the Cardiff airport across the estuary. But, unlike Bristol airport, which makes a profit, Rhoose makes a loss. There should be no doubt in the Government's mind that if they want to back a regional airport, Lulsgate should be the one and Rhoose should not.
It seems strange that a city such as Bristol, so well served by road, rail and sea communications, should be deprived of the last essential spoke in the wheel, an airport capable of handling today's big jets, just because the runway happens to be too short. The demand that exists among holidaymakers, tourists and business men should be met.
The hon. Member for Bristol, North-East (Mr. Palmer) has outlined what is required at Lulsgate. I endorse his remarks and would only add that the cost of the development to which the hon. Gentleman referred will cost about £12 million. The question will be asked "Who pays?" It must obviously be a combination of private enterprise and local authorities with the Government perhaps chipping in and passengers bearing their share. Is there possibly another source? I have been horrified in this debate to find how few hon. Members have referred to the cost of airports.
I should like to ask my right hon. Friend the Secretary of State and also my right hon. Friend the Minister of Transport, who is not here, if they could use their influence at meetings they attend in Brussels to get back from Europe more of the £1,000 million deficit that we in Britain are having to pay to keep inefficient Continental farmers in business.
Mr. Paul Dean: I hope that my hon. Friend, when making the case for Lulsgate, will appreciate that there is a large residential population around that airport and that such factors must be taken carefully into account before any major development takes place

773
in that area, which includes an area of outstanding natural beauty.
Mr. Colvin: I appreciate my hon. Friend's concern in looking after the interests of his constituents. But the case is well known. No one wants an airport on his doorstep, always somewhere else.
In principle, the Bristol area is in favour of a regional airport. Five million people live in the area around Bristol. They would use the airport instead of going to Gatwick or Heathrow.
Reverting to the question of the EEC and money, I should like to ask my hon. Friend the Under-Secretary of State, who will reply to the debate, what is this new transport infrastructure fund about which we have heard? One also hears of a proposal by the Commission to set up a special United Kingdom investment fund through which it is hoped to improve on the £350 million offer to restore some of the balance of EEC payments between the United Kingdom and our European partners. When my hon. Friend replies, I ask him to give his views on whether this could be a source of capital for investment in regional airports such as Lulsgate.
I support the Government's broad policy on airports, but I question their priorities for the South-East. I am conscious of the fact that nearly all the land around Stansted is grade 2 farmland. As trustees of our national heritage, we should seek to check the massive invasion of farmland, which if unchecked would result in its total disappearance from the United Kingdom in 200 years. That seems to be a suicidal policy for a nation that imports half its food in a world in which the population has been outstripping food supplies since 1965.
Some of my hon. Friends have suggested that an offshore site is still the alternative to Stansted. I support the Government's view that a new London airport should not be stuck in the mud. Powerful arguments have been advanced for reconsideration of a fifth terminal at Heathrow. My hon. Friend the Under-Secretary of State may argue that if that project goes ahead the development of a new London airport may be stuck somewhere else. In the past we have been easily put off any serious consideration of the development of a fifth terminal because of the sewage works at Perry Oaks.
774
However, the arguments now advanced by British Airways are enough to convince me that the Government should reconsider that alternative before they consider a second runway at Stansted. They must keep that option open.
I understand that the Government are concerned about the number of air transport movements at Heathrow following a fourth terminal or a fifth terminal. I remind my hon. Friend that Boeing is already considering a 1,000-seater airliner. By the time that the fourth terminal, or even the fifth terminal, comes into operation, 1,000-seaters may be the order of the day. If that is so, we shall see a dramatic increase in the number of passengers with little increase in the number of air transport movements.
Failure by the Government to get the airport priorities right, and failure to take urgent action after years of dithering, would result in our nation becoming an economic backwater. That is why, with some reservation, I support the Government's policy. Let them now get on with the job of giving the nation the airports policy that it deserves.
8.48 pm
Mr. Tim Renton (Mid-Sussex): My lion. Friend the Member for Bristol, North-West (Mr. Colvin) has spoken about 1,000-seater aeroplanes and the possibility of their entering service in future. That gives me the chance to lead straight into the main question that I wish to ask my right hon. Friend the Secretary of State and my hon. Friend the Under-Secretary of State. I hope that my hon. Friend will address himself to my question when he replies. It is a constituency issue. My constituents are concerned about the second terminal at Gatwick. If consent is given to the construction of the second terminal, it will be impossible to make full use of it without in due course constructing a second runway.
In answering my intervention when my right hon. Friend was making his extremely lucid opening speech, he said that a second runway should not be necessary. He said that the second terminal would be used to the full because, as he put it, we shall all be flying in jumbo jets rather than Cessnas in future. I have tried to land at Gatwick in a Cessna on several occasions. I assure

775
my right hon. Friend that it is already difficult to find airspace to get down in a Cessna at Gatwick. On one occasion I was stacked for more than 45 minutes above the airport while trying to get down. Later that same day I got down only by slipping, in a crafty way, between two commercial airliners.
There is already substantial air movement into and out of Gatwick. The airport handles between 7 million and 8 million passengers a year. Many of us find it hard to believe that if permission is granted to construct a second terminal, which will provide a capacity of about 25 million passengers a year for the two terminals, it will be possible for the facilities to be used without a second runway. I hope that my hon. Friend the Under-Secretary of State, who is an ex-pilot and extremely knowledgeable on these matters, will be able to assure us that that is not the case. We are frightened of development by stealth at Gatwick. The second terminal will give rise to the second runway and the second runway will give rise to a third terminal, and so on, until we become, like Heathrow, the ghetto of the jet age.
Terminals have grown up at Heathrow in a sprawling and ill-planned manner, where jumbo jets and passengers seem to get lost with equal abandon. If the Under-Secretary of State can give us a copper-bottomed guarantee that there will be no second runway at Gatwick, I shall approach the question of the second terminal with greater eqanimity than otherwise.
I have two more points. The first is about Heathrow. We are discussing airports policy, and other hon. Members have spoken of not encouraging too many tourists into this country. I do not fully agree with them, but I must say that the conditions at terminal 3 at Heathrow early in the morning are such as tremendously to discourage tourists arriving here. Whether we wish it or not, we shall particularly discourage those who arrive in jumbo jets from the United States.
It is a disgrace that passengers arriving from the United States are told that their flight will get in at 7 am and that they must then queue for up to two hours to get through immigration and passport control and collect their luggage. They are lucky if they leave terminal 3 by 9.30
776
am. That is a bad introduction to this country.
I have written to Ministers about this and I hope that it will be possible to supplement the immigration and baggage-handling staff at Heathrow so that those coming into the United Kingdom through that gateway in the early morning can get through quickly. Otherwise, they will come into Britain in a lousy bad temper, and I shall not blame them.
I greatly respect the Under-Secretary's commitment to the free market and I am of the same opinion as he. But on the question of where charter flights should take off I ask him to consider a recent experience of mine. I was lucky enough last autumn to get away with my wife to Crete. It was a charter flight and the departure points were Gatwick or Luton. Living in Sussex, I tried hard, and eventually succeeded, to get on to a Gatwick flight. Had I lived in London, or just north of London, I do not believe—bearing in mind that the flight left at 2 am—that it would have mattered very much whether the choice had been Luton or the East Midlands, or Luton or Birmingham.
I would have thought that there was a possibility, in this growing area of cheap charter night flights, to spread the net more widely, so that the departure load was borne by airports such as the East Midlands, where good facilities are under-utilised. To that extent we could develop a regional airports policy.
We would all like to see the development of a regional airports policy since it is a truism that those who have airports do not want them and those who do not have them want them. If it were possible to spread the charter flight load more evenly around the regions, everyone would benefit.
8.54 pm
Mr. Christopher Murphy: I welcome the decision of the Government on a future airports policy. It is absolutely essential that people should know at the earliest opportunity exactly what is to happen.
However, I give little in the way of welcome to that decision as it relates to Stansted. My right hon. Friend the Secretary of State knows the effect that the Stansted proposals have had on Hertfordshire. Many of us in that county have

777
yet to be convinced of the need for a third London airport, let alone an airport built at a time of vastly inflated Government spending that needs to be reduced.
Many of us regard with cynicism the outpouring of statistics on to the possible future travel plans of air-transported passengers, particularly in view of fuel costs. Many of us feel that our role as a crossroad for travellers leaping off one plane on to our soil and departing immediately for a further European destination leads to undesirable mayhem. That is particularly so when genuine arrivals in Britain could be well served by better use of regional airports.
Many of us are not yet prepared to accept that the supposed benefits of tourism and business will be outweighed by the loss of agricultural land and the gain of reinforced concrete.
In his initial statement on airports policy, my right hon. Friend the Secretary of State said:
"Years of indecision, decision and counter-decision reflect no credit on this country's capacity to make difficult but necessary choices."—[Official Report, 17 December 1979; Vol. 976, c. 37.]
He was right. The crux of the matter rests on making the correct choice. In the case of Stansted a semi-choice has been made. It is bracketed with additional activity at the regional airports, Heathrow and Gatwick. Flexibility is left for further expansion in the unspecified future. That ensures a return to the years of indecision that we are trying to cancel for many people in Hertfordshire and Essex, and all the human misery that such uncertainty entails.
When considering airports policy, it is wrong to think solely in terms of the area to be taken up by the airport—whether it is Stansted or any other inland site. A jumbo jet roaring off the runway creates vibrations which affect the lives of thousands of people many miles from the airport. The deafening noise from Stansted following take-off will fan out to be heard in Ware and Hertford 30 seconds later, in my constituency 45 seconds later and in St. Albans 10 seconds later than that. When a major international airport is fully operational, such a noise pattern can be multiplied by 800 aircraft movements. That is horrific.
There is more to contend with than noise. A new airport needs far more
778
than an area of land for runway and terminal usage. A gigantic urbanisation will be associated with a major airport at Stansted. Huge numbers of people will be needed to man the sprawling giant, creating massive urbanisation in that lovely countryside.
Not only will houses be affected, but so also will be schools, shops, hotels, ancillary industries and pubs. The vast communication network to reach the area will stretch its concrete tentacles far into Hertfordshire.
All the matters that we are discussing revolve around people. They revolve around not only the passengers but the potential 250,000 people who will flood the north Hertfordshire and Essex area in the next 20 years. They must be considered in addition to those who live there already. London has sent offshoots into the Home Counties. The growth of new towns such as Welwyn Garden City and Hatfield is evidence of that. A desirable rural atmosphere can still be enjoyed by Hertfordshire people and Londoners. That will be taken away by the proposed expansion. Where will the new influx of people find delightful areas for their leisure time?
There is no doubt that any inland site chosen for the doubtful privilege of playing host to the third London airport will rightly endeavour to escape such a fate. I have the honour to represent a Hertfordshire constituency, but it is not sufficient for me to try to defend my county at the expense of colleagues. I have attempted not to do that.
I respectfully suggest to my right hon. Friend that Stansted should not be the site for a third London airport, nor should any other inland part of Britain. Our countryside is too precious to be despoiled in such an unseemly fashion. Let us content ourselves with a limited expansion of regional and existing airports, remember the grave consequences of public expenditure at a time of low growth, and turn our minds to happier contemplation.
9 pm
Mr. Clinton Davis: I seem to have lived through this debate on several previous occasions. It has been an interesting debate. At times hon. Members made passionate speeches in defence of their constituency interests. The debate illustrated how difficult is the

779
task of any Minister seeking to deal sensibly with the creation of an airports policy. The different, often competing interests that are involved were vividly depicted by many speakers.
On many previous occasions have I heard a number of the representations made today. The hon. Member for Twickenham (Mr. Jessel) has defended his constituents nobly on many occasions in this House, complaining about the pestilence of noise at Heathrow. He even battled for legal remedies to be provided for his constituents. A considerable time ago I read a letter in The Times which I thought was very apposite, although I did not necessarily agree with its conclusion. It was headed "Winged nuisance". It reads:
"Sir, If 30 hens + 20 ducks + nine geese + two cockerels + a peahen = intolerable nuisance to five people,"
—hon. Members may remember that case—
"what do 50 Jumbos + 40 BAC 1–11s' + 35 707s + four Airbuses + a Concorde = to many thousands of people on Heathrow flight paths?
An exact analogy cannot, of course, be made, because although you can take a peahen to court, no such action is possible against the unfeathered variety."
That summarised the representations that were made about the provision of legal remedies for people who were afflicted by that nuisance. However, as I say, I do not necessarily agree with the conclusion.
The right hon. and learned Member for Hertfordshire, East (Sir D. Walker-Smith) made an interesting point, though an incorrect one, which was echoed by one or two other hon. Members. He prayed in aid the doctrine of double jeopardy—autrefois acquit—that Stansted had been acquitted before and should not be placed in jeopardy again. However, it is fair to say that there were different considerations prevailing at the time. It was a different case altogether from the one that we are currently having to consider.
My hon. Friend the Member for Bristol, North-East (Mr. Palmer) had to leave. He apologised to Members of both Front Benches for that fact. He felt that the Secretary of State had led Bristolians down the garden path or per-
780
haps into the Severn tunnel—I am not sure which. No doubt the Under-Secretary of State will deal with his point as, in fairness to Bristolians, it should be dealt with.
The speech by the hon. Member for Saffron Walden (Mr. Haselhurst) was passionate and well delivered. He has always been deeply opposed to the development of Stansted. However, the conclusion that I should have drawn from some of his remarks—I regret that he is not present—is that the loss of agricultural land, as he seemed to argue, would not justify any green field site. What would it justify? The conclusion that I should have drawn from his speech was basically that he did not want to see—perhaps he did not feel it necessary—any additional airport development.
I take this opportunity, as Mr. Edmund Dell and I set up the Advisory Committee on Airports Policy and the Study Group on South-East Airports, to congratulate the members of both groups for the meticulous care which they devoted to their studies. Their careful analysis must have facilitated the work of Ministers in arriving at the conclusions they reached, whether one agrees with them or not.
The Ministers must appreciate the help that they were given to enable them to wrestle with the formidable problems with which they are now presented, and which still remain, whatever the House may say. The task that still lies in front of Ministers is to implement the proposals which they set before the House. The proposals may have had a relatively quiet passage here today, but what Ministers heard from Government supporters was simply an augury of what they might expect in the affected constituencies. I know that they understand and appreciate that only too well, and I compliment them, therefore, on the fact that they have made this decision notwithstanding those political considerations. The work of the two groups has materially assisted in putting this debate on a sensible course. It has provided us with important data, although, in a moment, I shall have a little more to say about the fallibility of forecasting.
The common theme throughout the debate is that, wherever one seeks to site a major airport, there will be objections on environmental and planning grounds and on grounds of local considerations. What

781
the Government—any Government—must do is to seek a solution based on a balance of advantage. Whilst environmental considerations are obviously very important, they cannot be paramount. May I say, incidentally and in parenthesis, that it is a pity that there is no Minister from the Department of the Environment present today, because many of the points that have been made bear upon the duties of Ministers of that Department.
Various strands of thought emerged during the course of the debate. It was argued that there is no need for further airport development in the South-East beyond, perhaps a little grudgingly, a fourth terminal at Heathrow, a second terminal at Gatwick, subject to the current planning inquiry—and a number of Members with constituencies in the Gatwick area are not very happy even about that—and a very limited development at Stansted, which my hon. Friend, the Member for Harlow (Mr. Newens) was prepared to accept when I was in office, although he does not want it to go beyond that. This assertion, of course, is made in the face of the analysis and the conclusions reached by the advisory committee.
The second strand of thought appears to be that one can adopt the argument to which I have just alluded, with some qualifications, but it is coupled with the assertion that the massive development of regional airports represents an alternative to further airport development in the South-East.
The third strand comes from those who argue that Maplin, whether on the lines orginally envisaged or as a sort of mini-Maplin, as suggested by the Greater London Council, should be the preferred solution. The fourth is the line taken by the Government and, in essence, by the Opposition, embracing a flexible approach, which calls for the gradual development of Stansted and maximises, as far as is practicable, the use of regional airports.
A number of arguments have been prayed in aid by those against the proposals. The suggestion is made, quite rightly, that we are living in a period of economic recession, which is likely to deepen, that this has been stimulated by accelerating fuel costs, and that these factors will negate the forecasts made to support the view that the aviation industry will continue to develop. Indeed, my
782
hon. Friend the Member for Harlow questioned the assumptions, with, I believe, some justification, that are set out in the Government's background briefing to airports policy on the likelihood of the annual growth in the gross national product to the end of the century. He may be right or he may be wrong: it is a forecast.
We do not seem to be going through a very optimistic patch at present. The Secretary of State conceded the fallibility of all forecasting. When I went to get a cup of tea this evening I was interested to read an article about him in the Evening Standard. He was asked about all the wildly optimistic Treasury forecasts, and he said:
"Forecasts are the bane of our existence. If it was in my power, I would abolish all forecasting".
No doubt that included weather forecasting. He went on to say:
"They are no guide to policy-making. Policy-making must be a question of instinct. One must take risks".
That is a bit of a hostage to fortune in this debate.
The forecasting done by Roskill was 50 per cent. wrong. We acknowledge that there was great difficulty in forecasting what would be the future needs for airport capacity. Who could have foreseen back in 1972 the costs we would have to bear for aviation fuel in 1980? Mark Twain had the right judgment on this when he said that he was always prepared to prophesy—except about future events.
If I may say so with respect, many hon. Members have taken convenient refuge in the argument that all forecasts are likely to be wrong. That is a bland and dangerous assertion to make. The conclusion to be drawn from that is that we have to take a chance that the forecasts are wrong, but what happens if that is wrong? What happens if those conclusions prove to be absolutely wrong and out of court? What happens if the assertion that the regions will be able to absorb all the surplus capacity from the South-East is proved wrong during the next 10 or 15 years? That would be a terrible blow to the country.
I take some comfort from the experience that we have lived through fairly recently. Fuel prices went up following the oil crisis of 1973, and for a time there

783
was a slowing down in the pace of development of international aviation. Notwithstanding those fuel price increases, the pace of development in recent times has quickened substantially. Experience tends to support the findings of the committee which have been accepted by the Government. Of course, while we could be wrong about that, I believe we should assume that they are likely to prove broadly accurate.
Many imponderables remain. There is likely to be a continuing increase in the use of aviation for leisure and business traffic in the 1980s; and that seems to be the view of the British Airports Authority and the advisory committee. One thing that is likely to emerge is that, although an average increase of between 6 per cent. and 9 per cent. per year is forecast—that may be a little optimistic—that advance will not be a steady, even average per year but will be erratic.
My judgment is that the Government are right in saying that all these arguments call for a flexible approach, as was recommended by the advisory committee. The advisory committee urged strongly that we should not suppress demand for air travel, which was implicit in many of the arguments heard today. I agree with that.
It has been rightly stated by all hon. Members that Britain is a great trading nation and that air transport plays a vital role in assisting with our balance of payments and in generating employment. The statistics in support of that have been revealed today. Therefore, to turn away opportunities for expanding further a still-growing, developing industry in order to strengthen our economic activity would be folly.
Moreover, tourism, which is integrally connected with the development of the aviation industry, is one of our biggest money spinners. We know that the ratio of tourists to business passengers in the 1980s is likely to move in the direction of about 80:20 in favour of leisure travel. Some hon. Members have denigrated tourism. The hon. Member for Saffron Walden was dismissive of it. In a sense, he reminded me of the elderly lady who was interviewed on local radio. She complained that tourists were an abomination in London. She was reminded by the
784
interviewer that tourists were bringing in hundreds and hundreds of millions of pounds. Her response was simple. She asked why they do not stay away and simply send their money to Britain. That would be a convenient solution, but things do not work that way.
We must maintain a balance. That is not in any sense denigrating those who advance the environmentalist argument.
Mr. Haselhurst: I apologise to the hon. Member for Hackney, Central (Mr. Davis) for not being present at the beginning of his remarks, but in his last words he is correct. There must be a balance between our needs to develop our tourist industry and the siting of our airport capacity to deal with the increase in tourism.
Mr. Davis: I agree with that. I was not aware, when the hon. Gentleman spoke earlier, that he was seeking to draw the right sort of balance. However, he missed my earlier reference to him. I shall not repeat it. He can read it later.
We must not imperil our aviation industry, and we must not imperil London as an important financial trading and tourist centre. Some of the arguments that would lead towards that result.
The central question in the advisory committee report was not so much whether we should provide capacity as where it should be provided.
Much was said about the need to develop regional airports. Hon. Members from all parties were in favour of developing regional airports. The categorisation of airports in the regions which we undertook and which is now accepted by the Government was designed to assist that task, but it is not a substitute for sensible policies substantially to aid the regions in other directions. If the regional airports are to thrive, such policies must accompany that.
It can hardly be claimed that successive Governments did very much to achieve the success of regional airports. Local authorities seem to have developed airports as virility symbols. There was no clear pattern. There was no national policy. There was no central guidance. The result was that we had too many regional airports, there was too much capacity, they were too expensive to run,

785
and too many of them accumulated heavy losses. That is why in 1978 we brought forward those proposals.
The Secretary of State was asked how he would encourage the fullest use of regional airports. He has not answered that question to my satisfaction. Admittedly it is a difficult task. However, as the Government put that in the forefront of their statement on 17 December, it is incumbent on them to reveal to the House much more specifically their plans for regional airports. Do those plans differ from our policies?
The Secretary of State appeared to suggest that commercial criteria were paramount in dictating the pattern of further development. He referred to the new routes that had been provided over a number of years—1,500 in all. How many have been taken up? I believe it is about 100. The reason is that tour operators and airlines are concentrating on larger aircraft and, therefore, cut out some regional airports. It is as clear and as simple as that.
It cannot be denied that many people desire to come to London. As I said before, London is a tourist and trade attraction.
Mr. Colvin: The hon. Gentleman says that users of airports desire to come to London. He refers to the Labour Government's policy of regional airport development and the selection of Rhoose as the regional airport. Lulsgate in Bristol would have been a better choice. About 30 per cent. of the people using Lulsgate come from South Wales and prefer to use Bristol. Surely, we should consider a combination of market and Government directions.
Mr. Davis: The terminal facilities at Rhoose were much better. The local authorities that control Bristol airport had no decided view on the pattern of development. If those authorities cannot agree, how can the Government impose their will on them? The hon. Gentleman skipped over that point.
I believe that when the Secretary of State says that part II of the Civil Aviation Bill will help, he must specify how.
Mr. John Smith: That is a lot of codswallop.
Mr. Davis: My right hon. Friend says that that is a lot of codswallop. It is a little codswallop, but then I am a little "winder-up" compared with a big "opener".
The Secretary of State knows jolly well that that was just a phrase that he used. It does not mean a thing. He should indicate whether he is proposing to provide incentives to the local authority airports scattered up and down the country. I basically believe that they will be left to their own devices. If they have something attractive to offer tour operators and airlines, they have to market it. They do not appear to have done that significantly well in the past. There it is. It was the Minister who made the point.
I come briefly to Maplin. The Minister has convincingly deployed a case against Maplin. It has been effectively deployed before. Maplin would be wholly inconsistent with the requirement for flexibility. I believe that it is a non-runner for the reasons put forward by the hon. Member for Essex, South-East (Sir B. Braine). It is an idea that should be buried once and for all and never again disinterred.
I now turn to Stansted. Stansted is there, and that is a powerful argument for the development of Stansted when it comes to public expenditure. It involves the least risk. It provides for a phased development, because we are starting with an airport and a very good runway. Having said that, I believe that it will be subject to a great number of problems.
We start off with the planning inquiry. The result of that is unpredictable. A number of hon. Members ask the question—and I repeat it to the Minister—if the planning inquiry proves inconsistent with the Government's policy as pronounced in the House, what is likely to be the fall-back situation? Or do they feel that it would be inconvenient to announce that? I would understand that because it could imperil the arguments that are to be adduced at the inquiry.
Sir Derek Walker-Smith: I am obliged to the hon. Member for Hackney, Central [Mr. Davis) for his characteristic courtesy. Will he tell the House whether he would have answered the question about the use of section 47 of the Town and Country Planning Act—that is to say, the planning commission inquiry which is tailor-made for a situation such as

787
this—in the same way as my right hon. Friend or differently, and, if differently, in what terms?
Mr. Davis: I would have to refresh my memory about what the right hon. Gentleman said. I would not want to commit myself on the spur of the moment.
Sir D. Walker-Smith: The hon. Gentleman is a lawyer.
Mr. Davis: I may be, but I dare say that if I went to the right hon. and learned Member for Hertfordshire, East (Sir D. Walker-Smith) for an opinion from time to time he would not put it down on paper immediately.
Sir D. Walker-Smith: It would cost a little more.
Mr. Davis: I am not a planning lawyer, I hasten to say, and, therefore, I do not know the answer to that question.
A number of hon. Members have said "What about Perry Oaks? Is it cast aside for all time or is it something to be considered as a fall-back in the event of the planning inquiry going wrong from the Government's point of view?" I hope that the Government's Stansted will be fulfilled. I say that as a Member of Parliament for East London. I believe that it will produce employment in my part of London and new industrial opportunities and investment in areas in East London that have, over the years, become industrial wastelands.
I ask the Minister—because this is absolutely essential for the development of Stansted and Gatwick—how he will achieve the transfers from Heathrow to Gatwick and Stansted, other than the provision of new services which, we all know, will move to the airports concerned. The fact is that in the two recent tests concerning Iberia and Air Canada the Government decided not to impose a transfer except for new services, or services in excess of present capacity in relation to Iberia. This is a very important question to which I how the Minister will address himself in his winding-up speech.
I turn now to something in respect of which I am speaking, not for the Opposition but as an East London Member. In our White Paper, at paragraph 152, we said:
788
"A final but important aspect of general aviation is helicopter operations."
We saw the need for a heliport terminal in London, much bigger than the present one, that might be operated by the British Airports Authority.
I should like to see a major heliport in the London docklands. It would be of immense help in tackling the problems to which I have just alluded. There is great scope for development. The larger new generation of helicopters that will come into operation in the course of the next five or six years will enable flights to be made to the Continent—Brussels, Paris and Amsterdam—which will be quicker and much more convenient for people who live on that side of the City.
The opportunities for scheduled flights become a distinct possibility with the arrival of the 66-seater Chinook. It is an exciting prospect and I hope that the new Docklands Development Corporation will look most carefully at this. I do not believe that the environmental costs will be heavy. It will be possible to fly over the river and mitigate the damage to the environment. I am certainly not suggesting this as a substitute for the development of Stansted in any way but simply as an additional dimension to help the emergence of new business, as well as aiding existing business, in the City and East London. I believe that it will do something to cure the blight of unemployment, the lack of opportunity and the scarcity of industry that afflict my part of London.
My right hon. Friend the Member for Lanarkshire, North (Mr. Smith) spoke of the financing of the developments by the BAA. The Government are insisting that the BAA should finance the vast expenditure out of revenue. My right hon. Friend raised the important issue whether this is a case of present generations paying for the use of airports by future generations. Why should not the BAA be permitted to borrow? Would that not be a fairer way to tackle the problem?
I believe that the problem that affects airport development has persisted over many years, but it has changed in character. In the 1960s it was associated with the shortage of runway capacity. In the mid-1970s it became a problem of passenger handling capacity, with the arrival of larger aircraft and the complete change in traffic patterns. I believe that

789
the Government have done a good deal to try to signal the way ahead. They have many formidable problems ahead of them, problems with which we would have been faced if we had been in office.
I end where I began by saying that I believe that the work of the advisory committee and the South-East study group has certainly helped me—as I believe it has helped the House and Ministers—to come to sensible conclusions. We have to get on with the task of ensuring that the aviation industry will prosper, as has been recommended by the advisory committee. While the Government must seek to achieve that objective, they must also do whatever they can to meet the genuine and sincere claims that have been made by all hon. Members to do whatever is possible to mitigate the environmental disadvantages which inevitably flow from attaching themselves to that proposition.
9.31 pm
The Under-Secretary of State for Trade (Mr. Norman Tebbit): In his opening speech my right hon. Friend the Secretary of State described in detail the Government's policy, which he outlined in his statement of last December. I do not intend to go over the same ground; instead, I shall try to reply to the speeches of those who have taken part in the debate. That is not an easy task, because they represented so many threads of opinion. Indeed, that was typified by the intervention of my hon. Friend the Member for Somerset, North (Mr. Dean) in the speech of my hon. Friend the Member for Bristol, North-West (Mr. Colvin). As soon as the one advocated more traffic at a particular airfield, the other said "Oh, no, that would not suit my constituency." That encapsulates the tenor of the debate that we had today.
If I do not spend too much time on the remarks of those who have supported our policy, it is not because I do not value that support but rather because I believe that I should do my best to deal with its critics. First—not because he was critical—I shall refer to the speech of the hon. Member for Hackney, Central (Mr. Davis) and that of the right hon. Member for Lanarkshire, North (Mr. Smith). I echo the thanks of the hon. Member for Hackney, Central to the members of the two committees who sat through some arduous and torrid sittings
790
—I fancy—from time to time in order to give us the benefit of their advice in the two papers that have been produced at the end of the day. I am grateful to the hon. Gentleman for the general tenor of his speech. Like the speech of his noble Friend Lord Ponsonby in the other place, it broadly supported the Government's policy.
I would rather not say what will be the Government's attitude to a rebuff of the planning inquiry. Whatever I said would not particularly help the inquiry. It is much better for the case to be made at the inquiry. I believe it is such a compelling case that the inspector will find in favour of our policies. The hon. Gentleman referred to the progress of the Gatwick transfers. That progress has been extremely successful, and the chairman of the BAA is satisfied with the way that things have been going and the way that we expect them to go even more quickly in response to the differential charging that will be widened between Heathrow and Gatwick later this year.
There are many successful airlines now happily established at Gatwick. Apart from such old-timers as British Caledonian, there are such international carriers as Delta, Braniff and Air Lanka, and the Zimbabwe-Rhodesian airline will be operating there shortly, as, indeed, will the Chinese national airline when the service to Peking is inaugurated later this year.
The hon. Gentleman referred also to his enthusiasm for a London heliport. He emphasised that he was speaking for himself rather than his party. I am not sure whether a Minister is allowed to speak for anybody other than the Government. However, when I was a Back-Bench Member—also from East London, although further north than the hon. Gentleman—I shared his enthusiasm. I hope that we shall find a satisfactory means to provide a proper heliport in London without adverse effects on the local community.
The right hon. Member for Lanarkshire, North in some ways tended to see matters a little the wrong way round. I am not sure that he is convinced that airports are there to bring and take passengers to places to which they wish to go. They do not actually cause passengers to want to go to a particular

791
place. As Manchester attracts more passengers, so its airport will receive more passengers. Building an airport, as I am sure the right hon. Gentleman knows, will not bring any more passengers. At one time I thought that he barely cleared himself from advocating, in the interests of regional policy, a series of Marie Celeste airports that would never have anybody aboard when one arived.
Mr. John Smith: The Minister will recollect that it was not I or anyone on the Opposition Benches who, last December, put at the forefront of airports policy the development of regional airports; it was his right hon. Friend the Secretary of State. Nothing has been done to justify the assertions that he made at that time, except to encourage local authorities to write to him. But he then turns them down. My question is, what has happened to the great assertions of the Secretary of State about regional policy? Will the Minister tell us more about that?
Mr. Tebbit: I should not have pulled the right hon. Gentleman's leg so hard. He and I are used to these exchanges, having sat on a Standing Committee together for some weeks.
Mr. Smith: I am not used to it.
Mr. Tebbit: Before we are finished I shall get the right hon. Gentleman used to it.
What should be done to pursue the regional airports policy? First, we can. undertake to assist in financing viable, profitable increases in capacity where they are needed. I thought that the case put by the hon. Member for Bristol, North-East (Mr. Palmer) was not as characteristically generous as usual.
It is true that the leader of the Bristol city council wrote to my right hon. Friend. I replied on his behalf, as I deal with airport matters in general. I said:
"The Department of Trade would of course be willing to consider any plans the Council may have, but I must say that, if they involve an application for key sector loan sanction or other financial support, we would need to take into account not only the economic viability of the proposals and the public expenditure implications, in the light of the Government's policy regarding local authority expenditure, but also the relationship between Bristol and other airports able to provide services for South West England."
792
I invited Mr. Draper to contact the officials of my Department to see whether we could help him. He has not yet made any request for assistance. He wrote to us and I replied and outlined the position. I invited him to contact the officials. I do not think that I was under any obligation to do more.
Secondly, in pursuit of this policy, we are trying to free the somewhat restrictive European system of the grant of traffic rights, and clearing some of the obstacles that may exist to the third-level services that could grow between provincial European cities.
I believe that freer competition among airlines will also help to promote services from the regional airports. British Airways found that there were a number of regional services that they could not properly develop and they have come off those services. It has been noteworthy that there has been no lack of new airlines coming forward, many of which have been able to develop the services, such as the Liverpool-London service, more quickly than British Airways were able to do. I make no criticism of British Airways. It does not fit easily into their worldwide network to deal with some of the smaller regional services, and it may well help if they leave those for people who can specialise in them.
There is the policy of the concentration of air services into certain airports outside the South-East, most noticeably of concentrating upon Manchester as the English gateway intercontinental airport outside the, South-East. We are continuing to negotiate new rights with other countries wherever possible, especially for routes that are likely to be profitable. We are doing a great deal to further the promotion of tourism outside the South-East, both through the English Tourist Board at home and through the British Tourist Authority overseas. We are assisting in any way that we can with the best advice that we can give local airports on how to sell themselves. Indeed, we are advising tour operators in the same way.
The policy of realistic charging by the British Airports Authority and the policy of fixing for it a realistic target in terms of its rate of return on assets employed is, as hon. Members have said, bringing about some sharp increases in charges in the London airport system. That means

793
that the provincial airports will be that much more attractive to tour operators, who in many cases operate to very fine margins.
Mr. McNally: Surely, the central weakness that has emerged from the speeches of the hon. Gentleman and his right hon. Friend is that they are saying that throughout the 1980s the tour operators, with ministerial approval, will exercise their God-given right to operate out of the South-East without any kind of ministerial sanction whatever. I think that is a barmy policy.
Mr. Tebbit: It is not quite like that. They will exercise their right, which I am sure all of us agree that they should have who operate out of the airports from which their customers want them to operate. No one will convince me that if a queue of people are waiting to take their holidays out of Manchester to Spain, a number of airlines will insist that they will turn the business away rather than operate out of Manchester. That simply is not true.
I should like to deal briefly with the charges of the British Airport Authority. The £20 million, to which the hon. Member for Isle of Wight (Mr. Ross) referred, will be released to the BAA next year. There is no absolute bar on short-term borrowing to meet the peaks of expenditure once the BAA is making a proper return on its assets employed. None the less, it is a requirement that the BAA should finance the development of the airport without the cost falling on the taxpayer. Of course, increased charges will in the long run put up prices, but hardly significantly in terms of the RPI. Equally, borrowing puts up the cost of living through interest rates.
I should like to deal with some of the other speeches that were made.
Mr. John Smith: I think that the Minister has confirmed that the BAA is not allowed to borrow in order to finance this development. However, does he think that the users of today should pay for the airports of tomorrow?
Mr. Tebbit: It is right that the airport and airline industries and the passengers should pay for what they use. I would have thought that that was absolutely in line with what everyone has said about the costs that are imposed on society, the
794
environment and the country by those who use the airports.
Dr. Glyn: Am I correct in saying that the authority also has to pay for the insulation grant? Perhaps my hon. Friend would look at the map that shows the area that covers the Heathrow airport noise insulation grants scheme that he so kindly gave me in advance. In view of the fourth terminal and the increased traffic, perhaps the map should be altered to include such areas as Windsor and Maidenhead. Those areas may be badly affected.
Mr. Tebbit: My hon. Friend is referring to a programme that involves £20 million of expenditure that is being financed by airport users. We have looked at those boundaries fairly recently. However, I shall look at them again and consider whether there is a case for updating them I shall ensure that my hon. Friend's constituents get a fair deal.
My right hon. and learned Friend made great play of the caveats in the forecast of the report of the advisory committee Indeed, as we all know, my right hon. Friend the Secretary of State has caveats about forecasting as well. However, my right hon. and learned Friend may have had the misfortune of picking up a copy of the report that lacked page 13. I am sure that that must be the reason why he did not quote the conclusions of chapter 3—although he quoted much more of chapter 3 among the caveats.
I remind my right hon. and learned Friend that the conclusion in paragraph 3.12(f) is that
"the capacity at existing airports in the London area, including the developments envisaged in the White Paper on Airports Policy and

795
referred to in Chapter 2, is likely to be exhausted towards the end of the 1980s;"
In sub-paragraph (g) it states:
"we do not think that the margins of error that might be incurred because of the assumptions made on oil prices, GNP and the regional proportion of traffic will make more than a marginal difference to this conclusion."
I am therefore convinced that my right hon. and learned Friend's copy lacked page 13.
Sir Derek Walker-Smith: Perhaps my hon. Friend would look at paragraph 3.12(e). That specifically states that the oil price assumptions were too optimistic. Every day that passes reinforces that conclusion. I understated my case with my characteristic moderation. I understated it in relation to the escalation of oil prices and as regards the increasing predominance of leisure travel as a percentage of the whole. I hope that my hon. Friend will do justice to my argument. Good advocacy always involves that.
Mr. Tebbit: I had hoped that my right hon. and learned Friend would notice that I quoted sub-paragraph (g). That passage refers to precisely that point. It concludes that the margin of difference is not significant. My right hon. and learned Friend very eloquently said that no one should he tried twice on the same charge. However, if Stansted is to be exempted on that ground it must be remembered that Maplin was also tried and found innocent. Just where would my right hon. and learned Friend put the airport? I do not wish to be unkind to him, but he sometimes misunderstands the difficulties involved in the decisions facing us.
Sir Derek Walker-Smith: If my hon. Friend insists on provoking me, I shall be the wicked animal of the French proverb. When I am attacked I shall defend myself. If my hon. Friend had listened to my argument he would have appreciated that we reached the question of Maplin or any other coastal site only on the third step of the argument, and my primary argument was that he had failed to discharge the onus of proof on either of the first two.
Mr. Tebbit: Indeed, but I think that I would find it extremely difficult to persuade my right hon. and learned Friend on the first point. I believe that he has
796
set out with the conviction that he would not be persuaded by anything that was said by me or by the expert committees that were set up and that reached the conclusion upon which our policy is based.
Sir Bernard Braine rose—
Mr. Tebhit: I hope that my hon. Friend will forgive me, but I shall press on.
The hon. Member for Isle of Wight made a most interesting speech. I found myself in agreement with almost everything he said except his comments about the fifth terminal.
I also agree with my hon. Friend the Member for Woking (Mr. Onslow), who was right to stress the benefits that the air transport industry brings us and to point out that tourism is a successful British export industry. Must we throw away one of our successful industries? Must we say that we do not wish to do that sort of business?
I beg hon. Members to understand that there is no field of economic activity that does not have some disadvantage. If we do not want tourists, what do we want? Do we want factories or coal mines in the South-East of England? Some hon. Members have been saying that they do not want this tourist invasion, but there are penalties in any form of economic activity. Even farmers tear up hedges and ditches and spoil the countryside. Even the farmers of Essex have intensive cattle and poultry-breeding sheds, which are not exactly reminiscent of the idyllic England of which we have heard this evening.
My hon. Friend the Member for Horsham and Crawley (Mr. Hordern) tempted me to enter into matters that are properly under consideration by the inspector at the inquiry at Gatwick. All that I can say on the subject of employers' objections to a new employer coming into the area is that if one asked any employer anywhere whether he would welcome another employer who would probably pay quite high wages, the answer would probably be "No". The hon. Member for Southall (Mr. Bidwell) nods in agreement. I find myself much in agreement with many things that he said about the difficulties in finding unanimity in any area.
I know that the hon. Member for Harlow (Mr. Newens) accepts that many of his constituents would welcome at least

797
a small expansion. I know that he says that they would not want the major expansion, and I would not want to misrepresent him in that way.
Mr. Newens: Will the hon. Gentleman agree that in fact I pointed out that I also would accept a moderate expansion at Stansted? This is the argument that I put forward.
Mr. Tebbit: Yes, of course I recognise that, and of course I realise that the hon. Member represents the views of many constituents in opposing a somewhat larger expansion. However, I thought that there were a number of other somewhat hairshirted views that he put forward with which his constituents would not agree. I suspect that many of them see nothing particularly immoral in dashing off in a jet aircraft on a holiday to Spain. I do not say that the hon. Member thought it was immoral, but he implied that it was slightly suspect if we used up supplies of fuel in the world while we were doing it.
My hon. Friend the Member for Saffron Walden (Mr. Haselhurst) made a speech that was interesting and passionate. Obviously he represents the feelings of the great majority of his constituents. I am glad that he felt that my right hon. Friends the Secretary of State and the Secretary of State for the Environment are approaching the question of the form of public inquiry with understanding, sympathy and fairness. I am sorry that he feels that the advisory committee and the South-East study group did not get their sums right. He is rightly anxious about the costs of urbanisation and its effects. I must confess that I do not believe that urbanisation will be as great as many people believe. I believe that there may be a great deal of reverse commuting.
I am puzzled why some people seem to believe that East Londoners would happily commute all the way to Maplin but would in no circumstances commute the somewhat shorter distance to work at Stansted. This is a great puzzle. Why does everyone opposed to this project say that a vast new town will spring up near Stansted if the airport grows to a substantial size but not seem to think that this matters if it springs up near Maplin? Or do they imagine that Maplin workers will live on Dengie Flats and all b web-footed? It has been claimed that tourists will damage this
798
country, but we have to earn our living somehow.
I am sorry that the hon. Member for Stockport, South (Mr. McNally) takes the view that it is somewhat patronising on my part if I go to Manchester. No doubt he would feel that it would show I was disinterested if I did not go. I hope that the hon. Gentleman will understand that I am a Manchester airport enthusiast. I shall do everything I can to help make Manchester airport successful. I do not wish to quarrel with him basically, because I agree with him on that matter. I have asked the British Tourist Authority to help market the regions. I see no reason why more tours should not be run from regional airports. I shall take care while in America later this year to speak on every possible occasion of the attractions of the regions.
I am sorry if the hon. Gentleman felt it was wrong to refer to Liverpool as remote. If one has come from Paris and wants only to go to London, Liverpool would no doubt seem remote if one were not allowed to land at London airport. When Kennedy is only three hours from Heathrow, a three-hour rail journey to get one where one wants to go is quite long. It will be noted that I said "airports". I did not say "cities".
My hon. Friend the Member for Meriden (Mr. Mills) is rightly concerned about the effects of expansion at Birmingham airport. My hon. Friend will have heard my right hon. Friend say that we have no sympathy with the idea of forcing people to go to Birmingham when they want to go to London. I assure my hon. Friend that although we have said that we believe that an expansion of Birmingham terminal capacity can be justified on economic grounds, that is a statement of economic fact and does not prejudge the finding of the inspector at the inquiry.
We shall not try to push traffic to Birmingham that does not want to go there. Birmingham is a great city. It has fought for, and won, a national exhibition centre. Naturally enough, there is a need for an airport associated with the centre. But I do not want people to go there if they really want to go to another city.
My hon. Friend the Member for Bristol, North-West referred in what I thought was a most effective speech to the need

799
for a carrot-and-stick technique in these matters. That is great. But one has to remember to use the carrot and the stick at the appropriate ends of the donkey or the whole thing will come to a rather bad end.
I should like to reiterate three points. I shall deal in correspondence with a number of other matters to which hon. Members have referred. First, there has been a great change since Roskill. Larger and quieter aircraft are now in operation. Secondly, there is no conspiracy of civil servants and the like trying to foist the Stansted solution on Ministers. I beg hon. Members to believe that. If Stansted keeps coming back as the solution, it could just be because it is the logical solution to the problem.
Thirdly, our approach is not dogmatic. We do not claim to be able to see with absolute certainty the demands of the
800
industry in the year 2000. But we believe that we have identified a strategy that avoids the risk of the waste that might come from having a huge investment in a new green field site that can never be used. It avoids the risk that we might have to throw good business and good jobs away abroad. I believe that we have found a solution that minimises environmental damage overall, including the environmental cost of the roads and the railways that are needed. I believe that the House should accept this motion to take note. I believe that the inquiries, when they have heard the facts, will be forced to the same conclusions as the Government have been.
Question put and agreed to.
Resolved,
That this House takes note of the Government's airports policy.

LEICESTERSHIRE AREA HEALTH AUTHORITY (FINANCE)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. MacGregor.]
10 pm
Mr. John Farr: The debate which I am initiating tonight is in my name, but the concern that I shall express is shared equally by the nine Members representing the city of Leicester and the county. I know, for instance, that the hon. Member for Leicester, South (Mr. Marshall) is in the Chamber to express the city's point of view. I hope that the hon. Gentleman, and any other of our colleagues who happen to be present, will have the opportunity of catching your eye, Mr. Deputy Speaker, should they wish to do so.
It is safe to say that our nine Members have been jointly concerned about the inadequate provision of funds for the Leicester area health authority over a number of years. It has not been difficult to set aside party differences in a combined effort to secure proper financing for the Leicester area.
We have had more than one Adjournment debate on this subject. We have written joint letters to different Ministers responsible for the social services expressing our concern. In the previous Parliament we went as an all-party delegation to see the then Minister with responsibility for these matters. All these efforts have been directed towards securing equality in the provision of funds for the Leicester area. It is because of the continuing dissatisfaction of us all with that provision that this Adjournment debate is taking place.
First, I make it transparently clear that we are not, especially at this time of economic stringency, asking for new money. However, we are urgently demanding that a fairer way be arrived at for distributing the sums that are already provided. In other words, we seek, to put it crudely, a fair share of the cake.
To deploy my argument, I shall of necessity have to refer to one or two figures and place them before the House. I ask the House to consider the issue in a twofold way. First, I ask the House to
802
consider the expenditure per head on health services in the 14 national regions, including Trent, in which the Leicester area finds itself. Secondly, I ask the House to consider the situation within the Trent region and to consider the funds allocated to the Leicester area health authority within the Trent region.
If we consider Health Service expenditure nationally for the 14 regions over the past six years—my right hon. Friend the Secretary of State was good enough to provide me with the figures in a written answer shortly before Christmas—we see that the Trent region has been consistently at the bottom, or next to the bottom, of the 14 national regions in Health Service expenditure per head of population. It is that consistent bottom place, or next to bottom place, that the region has occupied for so long that disturbs us all.
In 1974–75 the money spent on the Trent region was £61 per head compared with £85 per head spent on the region that took top place—North-West Thames. The Trent region was bottom then. It was bottom again in 1975–76, when the money spent was £81 per head compared with £108 in the top region, which was again North-West Thames. In 1976–77 the figure was £93 per head compared with £121 per head in North-West Thames. In 1977–78 it was £105 per head compared with £134 per head in North-West Thames. In 1978–79 the figure for the Trent region was £120 per head compared with £148 per head in North-West Thames. In 1979–80 the Trent region is bottom but one, with £132 per head compared with £163 per head for North-West Thames.
It can be seen from those figures for Health Service expenditure that the Trent region has been consistently deprived. Within the region—and this is what brings the Leicester and Leicestershire Members together tonight—there are eight area health authorities, of which Leicester is one. I remind the House that Leicester is an authority with special problems associated with a large immigrant population and that contrary to the national trend the population of Leicester is growing.
If one compares expenditure by the eight authorities in the region in each of the last five years for which figures are available, one sees that expenditure in

803
Leicester has been well below that of the other seven areas.
To show the consistent discrepancy in Leicester, I quote the following figures. Expenditure per head in the city in 1974–75 was £55 compared with £61 in the region and £85 in North-West Thames. In 1975–76 the Leicester figure was £73 per head as against £81 in the region and £108 in North-West Thames. In 1976–77 the Leicester figure was £83 per head against £93 in the region and £121 in North-West Thames. In 1977–78 the Leicester figure was £95 against £105 in the region and £134 in North-West Thames. In 1978–79 the Leicester figure was £109 against £120 in the region and £148 in North-West Thames.
It is felt by my colleagues and myself, regardless of party, that these figures speak for themselves. The figures emerge from written answers that I received from my hon. Friend. What my hon. Friend did not supply, to my regret, were projections of expenditure in the immediate future. I should have thought that it was not too much to ask what the 1980–81 and 1981–82 allocations would be. I can assure my hon. Friend that those figures are awaited with the utmost anxiety in the city and county of Leicester.
If, as my hon. Friend says, the figures are not available, why are they not available? Surely the allocation of funds is not left to chance. There must be some form of forward planning. We have asked some reasonable questions and we expect answers tonight or later.
My hon. Friend the Minister for Health, in a letter to me dated 19 October 1979, in response to an approach that I made on behalf of Leicestershire Members recognised the deprivation of the area. He assured me that he was keenly aware of the problems of relatively under-resourced areas such as Leicestershire. He also said that within the region the RHA recognised the degree of Health Service deprivation and the need to improve the level of funding in the next four years.
Other Members wish to take part in tonight's debate. However. I must refer to the role that the Leicester area health authority has played. It has been aware of the way in which its activities are
804
restrained by continual deprivation. In September last year the authority arranged a meeting with local Members of Parliament which most attended. The authority presented three papers to us, one of which was entitled "A Fair Share for The Population of Leicestershire". A key paragraph of that paper states:
"Leicestershire has been for many years, and continues to be one of the poorest provided areas in England in terms of financial resources available for health care … The national average number of in-patient cases treated in the 'acute' specialties in 1977 was 88 cases per 1,000 population, whilst the comparable figure for Leicestershire was only 67, which after allowing for variations in the incidents of disease in Leicestershire, represents a short fall in service of 21·5 per cent."
The paper states that the figure is attributable to a shortfall in funding.
Those hon. Members who hold regular surgeries in their constituencies know about the shortfall in funding. It is a human problem. People come to us because they cannot be admitted to hospital for an operation without waiting for years. They cannot have a Health Service consultation without a wait of many months.
The principle of the NHS is sound. After 20 years of making excuses I can no longer be proud of the service. I urge the Minister to do something for one of the most deprived regions.
10.13 pm
Mr. Jim Marshall: I congratulate the hon. Member for Harborough (Mr. Farr) on raising an important issue. He was responsible for initiating the last Adjournment debate on the inadequacy of financial resources available to the Leicestershire area health authority. On 16 July last year my hon. Friend the Member for Nottingham, North (Mr. Whitlock) raised the general question of the inadequacy of resources available to the region. He also drew attention to inadequacies in the Nottingham area.
It is important to impress upon the Minister and the Department that expenditure per head of population in the region is well below the national average. We receive many complaints in our surgeries about the length of waiting lists for hospital and out-patient treatment.
The personnel in the medical service in our region and area and the

805
numbers of doctors, nurses, midwives, professional, technical and ancillary staff, taken per 100,000 of the population, are below the national average. We impress upon the Minister the need to rectify this situation.
The resources allocation working party suggested a formula. It reduced, to some degree, the discrepancy over the past few years. But that by itself is not sufficient. If I may introduce a note of acrimony in this arms-across-the-sea debate, the realocation alone will not resolve the problem. I urge the Minister—despite all the pressures upon him from the Treasury and other Ministers about public expenditure cuts—to realise that the only way to rectify in the short term the deficiencies in our area is by an injection of new money. I urge the Minister to consider that as the only action that is likely to remedy the deficiencies in our own area.
10.17 pm
The Minister of State, Department of Industry (Mr. Adam Butler): I should like to record, from a slightly unusual position on the Back Benches, support for my hon. Friend the Member for Harborough (Mr. Farr). The fact that half of the Leicester and Leicestershire Members of Parliament are here, unusually for an Adjournment debate, demonstrates yet again how strongly we feel about this matter. None of us is satisfied by the lack of progress which has been made over recent years in getting this position right. The figures that my hon. Friend gave about the relative position of Leicester within the Trent region, and the relative position of the Trent region against the national average, demonstrate all too clearly that progress, if any, has been minimal.
We accept that the cake available is of a limited size at the moment, but we want a better share of it. We want an indication, not just an assurance, that things will get better. We need figures to which we can attach our hopes so that we know that our constituents will be better served, not in 10 years' time but, I hope, in a year or two.
10.18 pm
Mr. Greville Janner: I associate myself with all that has been said. I thank and congratulate the hon. Member for Harborough (Mr. Farr). There are wide divisions between the
806
Leicestershire Members of Parliament on many issues, but not on this one.
We in Leicestershire are near the bottom of the league in one of the worst-off areas in the country. We are a developing region, to which people are coming. We are a region of great need. We have the desperate problem of people who do not receive the health service that they require. Unlike the hon. Member for Harborough, I am proud of our Health Service, but I am not proud of the way in which the allocations are divided.
The previous Government and this one indicated that they intended to rectify this matter. Let them do so soon. There is now vast unrest, unhappiness and tremendous hardship in the Leicestershire area.
10.19 p.m.
The Under-Secretary of State for Health and Social Security (Sir George Young): I am most grateful to my hon. Friend the Member for Harborough (Mr. Fan) for raising the question of funding within the Health Service. His speech highlighted very effectively the difficult problems facing the Leicestershire area health authority at the moment.
As a Member for a constituency within the North-West Thames region, I felt somewhat humble listening to the league table that my hon. Friend read out. It is absolutely clear to the Ministers in the Department that this matter greatly concerns my hon. Friend and other Leicestershire members of Parliament, as is evidenced by the support that he received from my hon. Friend the Minister of State, Department of Industry and from the hon. Member for Leicester, South (Mr. Marshall) and the hon. and learned Member for Leicester, West (Mr. Janner). I assure all of them that my right hon. Friend the Secretary of State is only too aware of the tough decisions that health authorities throughout the country have to make in keeping within their budgets and determining which of the many competing demands on their limited resources should be given priority.
I readily concede that the Leicestershire area health authority has a very difficult task in attempting to improve health services in the county. There is no dispute that the area has suffered, and still suffers, from a legacy of low Health Service funding. No one could

807
argue with the statistics that my hon. Friend produced. The authority has the daunting task of undertaking new capital developments, including a major teaching hospital, as well as maintaining the growth of medical education.
I have looked through the correspondence in the Department. There is no doubt that the Leicestershire Members of Parliament have bombarded it with effective representations about the problems affecting their county.
Like other health authorities throughout the country, Leicestershire AHA has to make difficult decisions on competing priorities against a background of rising demand and limited resources. We have to accept that such decisions, difficult and unpopular though they may be, have to be taken if health authorities are to manage within their budgets. I am afraid that it is inevitable in the present economic climate that some highly desirable health improvements must regrettably wait.
However, it would be wrong to think that progress is not being made. A major building programme is under way in the Trent region and new hospitals are being opened, not only in Leicester but in Nottingham, Sheffield, Barnsley and Rotherham. The last few years in Leicester have seen the first two phases of the redevelopment of the Leicester Royal infirmary come into operation, and I was delighted to learn that Her Majesty the Queen is to open phase 2 next month. It will be a proud day for Leicester.
Also, new ward blocks have opened at the general hospital and the Glenfield community hospital, and Trent RHA has plans for the third Leicester DGH on the Glenfield site. These developments should go a long way towards providing the people of Leicestershire with the health service that they have every right to expect, though a great deal remains to be done, particularly in community hospitals and community health services in general.
Funds to open these have to be found from within the region's overall revenue allocation. Another major factor is the commitment, endorsed by successive Governments, to the expansion of medical education: Trent is unique—outside London—in that it contains three medical schools, Sheffield, Nottingham and Leices-
808
ter. The Leicester medical school is producing its first graduates this year—a proud moment indeed for all concerned—and we can look to the school for an increasingly important contribution to the supply of well trained doctors in the years to come.
All these developments will require substantial resources, and my hon. Friend will need no reminding that central Government is several tiers removed from where decisions are taken on the allocation of resources by AHAs. I know that he will not expect me to pretend that there is any prospect of direct central Government help for Leicestershire AHA. Indeed, one of the keystones of our policy towards the Health Service is that decisions should, as far as possible, be taken not from a distance by people who are inevitably remote from local needs and circumstances but by those who have first-hand knowledge of them. So whilst decisions on resource allocations to regional health authorities are taken by Ministers centrally it must be for RHAs to determine allocations to the area health authorities, and they must be responsible for allocating funds to health districts.
My hon. Friend pressed me about next year's allocation. The cash limits have not been fixed. We are aware of the urgent need to provide these at an early date so that planning can take place. I can assure him that a decision will be announced shortly and that he will be among the first to know of it.
My hon. Friend quite rightly reminded the House that a long period of under-investment in the Health Service, not only in Leicestershire but in the Trent region as a whole, is the underlying cause of many of the deficiencies he has described. The recommendations of the Resource Allocation Working Party aim to secure a pattern of resource distribution based on relative health care need. Under the RAWP formula, Trent has emerged as one of the most needy regions and has received the third highest growth rate this year—2·7 per cent., compared with a national average of 2 per cent.—and the second highest in the previous two years-4 per cent. in 1978–79 and 2·9 per cent. in 1977–78 compared with national averages of 2·3 per cent. and 1·4 per cent. respectively. The result has been a steady move towards target from 10·1 per cent. below average, following the

809
1977–78 allocation, to 7·25 per cent. below this year.
It is always an unenviable task to have to decide the fairest way of allocating new resources, particularly as in present times, when they are so scarce. Not only is it impossible to satisfy everyone, it is scarcely possible to satisfy anyone. It has come as no surprise to hear of the difficulties of the better-off regions such as my own in making ends meet from a position of virtually nil growth in the past, and from the less well-endowed regions, such as Trent, about the need from their point of view for a much faster redistribution of resources.
My right hon. Friend supports the principle of a fairer distribution of health care across the country. I envisage that the RAWP process will continue to play a major part in this, as it is the best objective measure of health care need we have available to us at the moment. The ultimate decision has to lie with my right hon. Friend as to how quickly we can sensibly move resources around.
I can assure all hon. Members that the points that they have made will be carefully noted and taken very much into account in our consideration of national policies on health service resources.
However, we cannot afford to ignore the fact that the former Administration, in reaching decisions on the 1979–80 allocations, found it necessary to slow down the pace of change towards targets. This was mainly because of the very real problems being experienced by the relatively well-off regions, which found it impossible to rationalise their services and redistribute resources to their deprived areas on the very small growth in resources that had been allowed to them in the previous years.
We must not lose sight of the fact that in well-provided regions there are areas that are deprived even by national standards. Indeed, there are areas that are even worse-provided than is the Leicestershire AHA.
Our ability to continue the process of redistribution depends crucially on the additional resources available nationally. We have inherited from the previous Government public expenditure provision for the hospital and comunity health services which, for next year, gives us growth nationally of less than 3 per cent.
810
This is not enough to cope with demographic demands and advances in medical technology, and will obviously set back the redistribution process. The provision of more resources will come from a stronger economy, which the Government are aiming to create the right conditions to bring about.
As for RAWP principles below regional level, regional health authorities have been asked to apply them in their allocations to areas. I know that Trent regional health authority is making every effort to achieve a fairer distribution of health service resources within the region, but there are constraints on the rate at which the legacy of inequalities within regions can be eliminated.
I fully recognise that Leicestershire has suffered a legacy of deprivation of health services, and I am conscious of the difficulties that lie ahead. It is true that, at present, the per capita funding of Leicestershire area health authority is the lowest in the Trent region. The RHA fully recognises the difficulties which Leicestershire faces in attempting to alleviate the acknowledged deficiencies in health services. The region has set a minimum growth rate for all areas and during the next few years, on present assumptions about future resources, it is expected that Leicestershire will receive the highest growth rate in per capita funding in the region.
Planning assumptions indicate that Trent will continue to be amongst those receiving the highest share of available resources on a national scale for the foreseeable future. Next year, we envisage small growth in real terms in the amount available to the National Health Service —about ½ per cent. overall and 0·6 per cent. to the worst-off regions. We are, of course, very aware that regions like Trent and areas like Leicestershire will be looking for continued redistribution of resources between health authorities. But the extent to which this can be done will clearly be restricted by the amount of overall growth money available next year and thereafter.
I realise that little that I have said today will have done much to lessen the hon. Members' concern. The only way in which I could have done so would have been to hold out a promise of substantial extra resources. This I cannot

811
do. We cannot be expected to allocate more to the i rent region without depriving other regions around the country. Similarly, Trent RHA could find substantial additional funds for the AHA only at the expense of its seven other areas.
The lesson that we all have to learn, both in central Government and in health authorities, is that we must manage within the resources available to us. Those responsible for the Health Service at all
812
levels are doing their best to redistribute resources as fast as available finances and other constraints will allow. There is a definite commitment on the part of the AHA to improve services in Leicestershire. It is a task that local management must tackle to the best of their ability, though progress, I am afraid, cannot be as rapid as they or I would wish.
Question put and agreed to.
Adjourned accordingly at twenty-nine minutes past Ten o'clock.