RATE OF CHILD BENEFIT (No. 2)

HC Deb 18 March 1980 vol 981 cc279-321

'In section 5 of the Child Benefit Act 1975 there shall be inserted the following sub-section—

"(7) The weekly rate of child benefit prescribed for any child with effect from 17th November 1980 shall not be less than £5.20'.—[Mr. Orme.]

Brought up, and read the First time.

Mr. Orme

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

Mr. Deputy Speaker

With this it will be convenient to discuss new clause 2—

Rate of child benefit (No. 1).

Mr. Orme

I thank you, Mr. Deputy Speaker, for the clarity in which you gave your advice. We now have the best of all worlds. I can speak to new clause 2, and we can vote on new clause 9. When the Division occurs, presumably when the guillotine falls, we shall vote on new clause 9, and if it is carried it will mean an increase in child benefit of £1.20 per child per week.

I have not cast aside new clause 2. I wish to discuss it, although we shall vote on new clause 9. No doubt other hon. Members will wish to participate in the debate. I hope that it will be a short and sharp debate. It is not my intention to speak for a long time.

The previous Administration intended to raise child benefit to £4.50 in November 1979 as a further step towards eliminating the short-term national insurance benefit increase for children. A 20 per cent. addition for inflation up to November 1980 would bring the rate to £5.40. The proposed rate includes a further instalment towards the elimination of the short-term increases. If they rise by 20 per cent. from £5.70 to £6.85—both figures inclusive of child benefit—a £6 child benefit rate would narrow the gap between child benefit and the short-term dependency rate to 85p, the rate at which it stood in April 1979. The gap would be eliminated over the next one or two years.

When the Secretary of State was in opposition and when I was in government, we were both in favour of moving towards the elimination of the gap between child benefit and the short-term dependency rate. That would have been a step towards eliminating the poverty trap. I appreciate that it will be a costly exercise, and no doubt the Secretary of State will refer to that when he replies.

However, we are discussing steps that could be taken to make child benefit a benefit for the family, which would be of real use to the low-paid and the working poor. Judging by the attendance in the House tonight, not least on the Conservative Benches—[Interruption.] I shall not go into any detail about the reasons why so many Conservative Members are here tonight. What they are doing, I have done in the past. I appreciate that they consider this to be a crucial issue. We are dealing with their Government and the Budget. Labour Members are clear on how we shall vote this evening. I am not in any way deriding the attendance of Conservative Members. Indeed, I welcome their interest in the issue. It is a central issue within our society. It is no good talking about the family, but not doing anything to help it.

A vital interest arises from the elimination of child tax allowances. It is not possible for the Chancellor of the Exchequer to help the family in his Budget, because there are no child tax allowances as such. Despite the economic problems that face the Chancellor, it would be unthinkable for him to do nothing about child benefit and relief for the family.

We know that the Chancellor will say something about the matter in his Budget next week, but nothing will happen until next November. However, single persons or married couples without children will receive the benefit from any change in tax relief in July, and it will be backdated to the date of the Budget. Everybody in the House knows that.

We are dealing with positive discrimination against the family. That was not the intention of the child benefit system. It was not our intention, and I am sure that it was not the intention of the Secretary of State. I am not here to score political points. One could quote other people at length. Mr. Hugo Young's column in The Sunday Times last week was based on the CPAG report, and he quoted the Secretary of State. I believe that the Secretary of State meant what he said to Mr. Young. On many occasions in the House he has given a passionate defence of child benefit.

The previous Labour Administration faced great difficulty when phasing in the increases in child benefit. They were phased in over a three-year period. Many problems and anomalies were created. Throughout that period the present Secretary of State, quite rightly, used his position in Opposition to tell us that the increases were not sufficient. He denounced the Labour Administration for not implementing the increase immediately so as to achieve immediate transfers from the wallet to the purse. He made child benefit one of the central points of his philosophy on the tax system.

The child benefit itself, because it is not taxable and is paid on a flat-rate basis to all families, provides a definite incentive and benefit to working families. In my constituency there are many mothers who cannot go out to work because they have two or three young children, and to whom that £12 a week is a life line. Certainly many families are facing difficulties. In some cases the husbands are difficult and do not treat their wives properly. In such cases the earnings are not shared fairly within the family. That is why we insisted that child benefit should be paid to the mother as a right.

When we phased in this benefit and the amount went up from £2.30 to £3, there were delays in Newcastle over making the payment and we had many phone calls from husbands—not wives—who were chasing the money. This may occur in a minority of cases, but I know that child benefit is a lifeline. We are dealing with this issue against the background of increasing inflation and all the problems that that has created for everyone, particularly families.

We are now making families wait 18 months for an increase in child benefit. We have heard a lot tonight about the proposed 50p increase that a Labour Government would have paid in November had they been re-elected last May. We have had arguments about the payment from the Contingency Reserve. The Secretary of State is aware that child tax allowances are calculated on one basis, and child benefit on another. Whatever the Government do, such benefits must come out of the Contingency Reserve this year, because that is the basis of financing. Whatever one may say about our 50p., the fact remains that the incoming Conservative Government did not pay it. It is regrettable that the Government did not promise an increase in April, 12 months after the last increase.

The Secretary of State for Social Services (Mr. Patrick Jenkin)

The right hon. Member is putting forward an important argument, but will he address himself to the problem? Child tax allowances were eliminated in April 1979, and as any increase in child benefit must be accompanied by a corresponding adjustment of the child dependency addition for the national insurance benefit and for supplementary benefit, had we done as the right hon. Member suggested we should have had to make two adjustments to these benefits in a year. In those circumstances, it seemed more sensible to have the child benefit uprating announced in time to enable it to take place at the same time as the adjustment to the short-term benefits. There are cogent procedural and conceptual arguments in favour of that.

Mr. Orme

I can see the argument for bringing the payments of the benefits into line. That is important. However, there is a problem with child benefit. In the east the family would have received the benefit arising from the Budget. If we move this benefit to the November uprating, that will mean a delay from April to November of this year. In those circumstances, we must at least take account of the mean level of inflation, otherwise child benefit will have been reduced.

I am putting the case for £6, but I realise that that is an ideal objective. The £1.20 increase is not an objective it is a target which people believe should be met by the Government because it will compensate for the rise in inflation by making the benefit £5.20. It will not be retrospective. Therefore, there will be a loss for the family while they are waiting for the uprating. There will be no net gain, as it were, and the family will have lost between last April and next November. However, if the amount is £5.20, at least by November the family will be keeping pace with the current rate of inflation. In other words, the purchasing power of the child benefit would be returned to what it was previously. This is crucial.

7.15 pm

We all have commitments to certain aspects of policy. I have said, quite fairly, that the Secretary of State's commitment to child benefit is strong—in fact it is no less strong than mine. I see child benefit as the start of a major social revolution within our country. The family must be taken care of. If we allow its position to be eroded, and if the Chancellor decides each April to keep the benefit below the level of inflation, we shall begin to eat away at the whole principle of child benefit. I assure hon. Members that it was difficult to in- crease the benefit to £4, because included in that money was not just the transference of the child tax allowance but a real input of public expenditure, which came out of the Contingency Reserve, and which, therefore, affected the public sector borrowing requirement. The Labour Government faced that. The 70p increase was a straight input, as was the extra 40p at the time of the initial phasing in. The proposed 50p in November would have been another direct input.

A great deal is heard about the work syndrome—the workshy and the question of incentives. If hon. Members are looking for an incentive for those in work and those who want to work, there cannot be a better one than child benefit. There cannot be a better incentive for the working family. It is an incentive for people who are struggling, many on below average wages. Many of these people have two or three young children, and that £12 per week is a lifeline to them.

A total of 7 million mothers draw child benefit every week on behalf of 13 million children. Some mothers can afford to wait several weeks before they collect their money and then use it to buy something for the children or the home. They are the more fortunate ones. Incidentally, they still go along and collect their benefit. The take-up of child benefit is 99.9 per cent. Nobody leaves it at the post office. Of course, the better off are paying for this benefit out of taxation. They are entitled to it, and they are not getting anything for nothing. They are helping —we are all helping—the poorer families and the working poor. That is the crucial factor, and I am sure that the Secretary of State will address himself to it this evening. I could give instances of families with one, two or three children who would be better off if they were earning £35 a week, and so on. One of the ways in which to deal with the problem is to give proper child benefit.

I deal briefly with new clause 9. Whatever the increase, or whatever the success of the measure, if it were implemented by the Government they, not the Opposition, would get the credit. We have had the same situation in reverse—I think that it was called the Rooker-Wise-Lawson amendment. I am concerned—I do not give a damn where the credit goes—about getting a decent level of child benefit. If £1.20 is the level that is acceptable to the House, based on firm logic, and on the rate of inflation. I support it, and I hope that Conservative Members will also support it.

Mr. Garel-Jones

There are many reasons why the child benefit should be raised by at least £1. When considering which reasons to put forward, one is confronted with an embarras du choix. However, as so many Conservative Members wish to speak I shall keep my remarks brief, and confine myself to one or two points only.

The principal reason why child benefit should be increased, as the right hon. Member for Salford, West (Mr. Orme) said, is that it is widely regarded as the most efficient way of providing support for families in general, and for working poor families in particular. The 1978 supplementary benefits review "Social Assistance" comes to the conclusion that families with children are at present at a disadvantage, even as against old-age pensioners. It says: An increase in child benefits should be the first priority for any additional expenditure on the whole system of social security benefits… The first priority should be to raise the living standards of low-paid workers with children. I do not think that many hon. Members would disagree with that.

Over the years the tax burden has continually and consistently moved against families with children. From the years 1960–61 to 1979–80, the proportion of income tax and national insurance paid by a childless couple on three-quarters of average earnings increased by 106 per cent. The increase for a couple with two children, one aged 11 and the other aged 16, was no less than 340 per cent. In 1978–79 the proportion for childless couples was reduced by 5.7 per cent., whereas a two-child couple continued to have the ratchet moved against them, and their proportion was increased by 2.1 per cent. That is a pattern that many Conservative Members believe should be reversed.

I wish to deploy one other argument —the cost-effectiveness argument. For example, if my right hon. and learned Friend the Chancellor were in his Budget Statement to decide to increase child benefit by, say, £1, it would be less than we are asking for. If he did that every family with two children would receive £2 a week extra. The cost of doing that would be £600 million in any one financial year. If the Government wish to achieve the same effect—

Mr. Chris Patten (Bath)

Does my hon. Friend accept that in this financial year —l980–81—the cost would be £250 million?

Mr. Garel-Jones

That is correct. I am grateful to my hon. Friend for that intervention. Assuming that the increase was made from November—it would not run for a full financial year—

Mr. Watson

Does my hon. Friend also accept that the increase might be slightly less than that, because if there were no increase in child benefit, the net Government funds that would have to be appropriated for other measures—particularly supplementary benefit—would be all the higher?

Mr. Garel-Jones

Yes, indeed. Already we are experiencing what I referred to as an embarras du choix, as the arguments in favour of child benefit come rolling in. The cost to the Government of achieving £2 a week per family with two children through tax and personal allowances would be £1,460 million. It would be considerably more expensive, and it would leave out the very low paid, who pay no tax.

I had intended to raise another point, but I shall not do so, because some of my hon. Friends will wish to make the point in more detail.

The reason why I and other Conservative Members have felt it necessary to table an amendment is that the clause that was originally moved by the Opposition, providing for £6, seemed to us—we accept the Opposition's honourable motives—to be too much to ask for now, given the economic climate. It is more even than the Child Poverty Action Group is calling for. We also accept that the Labour Party has an interest in defeating the Government, and it will not be surprised to learn that Conservative Members do not share that enthusiasm. We should all bear in mind the remarks made by my right hon. Friend the Prime Minister when she spoke to the nation on television recently. She said that the Government walk a tightrope between the need to face the economic facts of life and the claims of common humanity". We recognise that the Chancellor is walking a tightrope, and we have no desire to pre-empt his Budget decisions. I shall be in the Lobby with the right hon. Member for Salford, West (Mr. Orme), voting for this clause, but I hope that not too many of my hon. Friends will follow me. I hope also that the Government will regard what is happening in the House today as a serious warning of the strength of feeling in the Conservative Party, in the House in general and in the country on this matter.

I say to the Labour Party with great respect that we do not claim to have an exclusive lien on concern. We have never claimed that. However, we resent the claim made from Labour Members from time to time that their party and their party alone has a claim to concern.

I refer to the remarks of my right hon. Friend the Prime Minister some days ago, when she made a spirited defence of the record on social services of the Secretary of State for Industry. My right hon. Friend did not tell the House that the Conservative Party was in Opposition from 1964–1970, she was vice-chairman of the policy group on social services. She was the Front Bench spokesman on social security. She was a doughty fighter in Committee. Indeed, she took a great interest in the Committee. My right hon. Friend who is now the Secretary of State for Industry introduced a record number of benefits between 1970 and 1974. He was able to do that largely as a result of the work done by the present Prime Minister when she was in Opposition. As Secretary of State for Education and Science she undertook the biggest programme that this country has ever seen. That programme involved the replacement and improvement of secondary schools.

We make no claim to an exclusive lien on concern. However, no Conservative Member, including the Prime Minister, will accept that the Opposition have such a claim.

7.30 pm

During the same broadcast, the Prime Minister said that we must ensure that the changes that are made, and on which our whole future depends, come about as humanely as possible. I am sure that she meant what she said. She is not the type of woman to say or do anything that she does not believe in. Those who cannot look after themselves, such as the old, the sick, the disabled and children, should be properly cared for, and protected from the harsher winds of change. We have to walk a tight-rope between the need to face the economic facts of life and the claims of common humanity. An increase in child benefit is a matter not merely of common humanity but of common sense.

Mr. David Ennals (Norwich, North)

I welcome part of the speech made by the hon. Member for Watford (Mr. Garel-Jones). He will not expect me to continue his defence of the Prime Minister. However, I shall not make an attack. Many hon. Members feel that it is more important to achieve a major increase in child benefit than to defeat the Government. If those Conservative Members who agree with the hon. Member for Watford join him in the Lobby we are more likely to achieve that increase. I hope that they will not take his discouragement too seriously. Many Conservative Members are as committed as the hon. Gentleman. They should not decide which six should go into the Opposition Lobby, and keep the others out. They will all be welcomed.

I have some sympathy for the Secretary of State. When I became Secretary of State the first problem that I faced was that of child benefit. My hon. Friend the Member for Birkenhead (Mr. Field) and the right hon. Gentleman know that well. The right hon. Gentleman made some thundering attacks on me when we went through the painful process of phasing in child benefit. We chose to phase in that benefit. The process took three years. The right hon. Gentleman had great fun at my expense. In his heart he is deeply committed to child benefit. The Under-Secretary is also deeply committed to that principle. No issue put me under greater pressure when I was Secretary of State.

My right hon. Friend the Member for Salford, West (Mr. Orme) and I fought a battle, and we won it. A Labour Government achieved the phasing out of the child tax allowance. Child benefit was finally brought to the level of £4. That sum would have risen to £4.50 last November. I am glad that the right hon. Gentleman and his colleagues put pressure on us at that time. I am sure that he is faced with the same problem. He would have liked to make an increase in November and again in April. I am sure that he would like to see an additional increase. We are trying to give him more strength than he at present holds in the Cabinet so that he can achieve that end. He is not faced with the problem of phasing in child benefit. Indeed, unless there is a substantial increase in that benefit, he will be involved in phasing it out. However, the child tax allowance will not be reintroduced.

The House was under a moral obligation to supply child benefit, if it removed the child tax allowance. If child benefit is allowed to shrink as a result of inflation, without reintroducing the child tax allowance the Government will break faith with the commitment that was made. I am not suggesting that that allowance should be reintroduced. I agree with the hon. Member for Watford that child benefit provides the most effective way of supporting families. That support is desperately needed. Inflation is rising and parents need more money in order to look after their children. Child benefit may also affect the incentive to work.

My right hon. Friend and I organised a seminar. It received wide publicity, although that was not its intention. We invited pressure groups representing the elderly, disabled, unemployed and children to attend. We wanted to hear their views on social priorities. Although everyone wanted an increase in pensions and an increase in mobility allowance, they all agreed that top priority should be given to child benefit. I hope that we shall convince the Secretary of State with our votes and that we shall give him the strength to convince the Prime Minister and the Chancellor of the Exchequer.

Seven million families draw less and less each week in real terms. Those families will be let down unless they receive some compensation for the loss of value of that child benefit. I support my right hon. Friend.

Sir Brandon Rhys Williams

I am not moving new clause 5. That clause would have increased child benefit to the equivalent of the present rates of supplementary benefit. That is a larger increase than that implied in new clause 2 or new clause 9, so needless to say, I am rising to speak in favour of new clause 9.

Child benefit is one of the most important elements in our tax and benefit system. It is right that that benefit should keep pace with inflation. There are several reasons why child benefit is important. It is important for the mental and physical health of mother and child that all families should have sufficient income. We have sadly fallen behind other countries in regard to the matter of perinatal death rates. The British figures are disappointing. Perinatal deaths are particularly associated with social class. There may be absence of sufficient care in certain districts and so on; but I am certain that much of the trouble is due to fatigue, deprivation and malnutrition. We cannot let it rest on our consciences that we do not do enough for child health. Handicap and ill-health are a high price to pay for social parsimony.

Everyone is familiar with the argument about the incentive to work. Increasing child benefit is the cleanest and most obvious way of allowing people to escape from the poverty trap. It encourages them to earn their livings. There are also mothers who know that they should remain at home with their children but who feel that they have to take part-time work in order to have sufficient money to look after them. Latchkey children have to let themselves into an empty house when they come home from school because their mothers are out doing part-time work, perhaps at the check-out desk of a supermarket. They have to earn the extra money that society should be giving them at a crucial stage in the evolution of their family.

Increasing child benefit is a selective method of meeting rising living costs. Some Labour Members will not like to hear this, but it has to be admitted that increasing child benefit at a time of economic stringency is far better than agreeing to blanket increases in wages, which go to single people, teenagers and second wage earners, who are not in the same need. The breadwinner with a wife and children to support needs that money. We should give it to him selectively through child allowances rather than through having to pay blanket wage increases.

On the Continent, where family allowances are much higher than in this country, many people suggest that the high level of child allowance affects the propensity to strike. When the cost of living rises, the people most badly affected, the breadwinners with several mouths to feel are protected through increases in child benefit and do not have to force their employers to give them higher wages, as many people in this country find that they do. I hope that the Government will bear that in mind.

It is not possible to achieve any of these results to the same degree—or at all—through an increase in the family income supplement or supplementary benefits. I would not argue against an increase in either, but, if the Government want to achieve those desirable objectives, they must do so by raising child benefit.

I wish to deal briefly with certain objections that one sometimes hears, and particularly those which might be appropriate tonight. The first is the idea that the Chancellor must be allowed to make his own Budget judgment, and the House, the press and everyone else may comment, but must not force his hand right up to the moment when he announces his Budget in the House. But it is not right for the Chancellor to take it on himself to pre-empt decisions that fall to important Departments of State, such as the Department of Health and Social Security. The Treasury already has too much power. The House should not allow the Treasury to take decisions for all other Departments and keep those decisions secret until the last minute. The idea of Budget surprise is delightful for the Press but undermines the influence of the House of Commons.

One also hears the argument that there is something derogatory about universal benefits such as child benefit, and that people should be willing to resist such handouts because they undermine their ability to stand on their own feet and look after their families through their own earnings. One might as well say that a soldier should be ashamed to wear his uniform because everyone else in the same regiment wears the same uniform. There is nothing derogatory about accepting a universal benefit. In a computer age it is much the most efficient way of dealing with that angle of the redistribution of income.

About 35 per cent. to 40 per cent. of marginal increases in earnings goes back to the Exchequer either through income tax or national insurance contributions in any event. Child benefit is not, therefore, a handout. It is a means-tested benefit. As people increase their income, they pay the money back.

Then one hears the argument that a tax concession is simply the Chancellor paying back to wage earners what is, in effect, their own money, whereas to increase a universal benefit like child benefit is somehow not an equivalent concession. People who make that point are succeeding in a meretricious platform trick, which sometimes deceives an audience for a short time.

If we say that when the Chancellor makes a cut in taxation he is simply handing back to people more of their own money, that means that he is admitting that he has no right to levy taxation on individuals. If it is their own money, they have no obligation to pay it to the Treasury, and tax evasion is perfectly right. Of course that is not the case. If we levy taxation it is because our society recognises that one has obligations to contribute just as one is entitled to expect society to provide a reasonable minimum income guarantee in return. Taxation and benefit are part of a lifelong relationship between the individual and the community. The balances and judgments that have to be made from time to time are an interesting social problem. However, we should not fall into the error of thinking that the State is not entitled to ask anybody to pay income tax. That is quite wrong.

How do we pay for the increased child benefit? First, transfer payments are not Government spending. When money is given to mothers it is spent by them and not spent by civil servants or wasted in bureaucratic muddles. The mothers decide how to spend their child allowance and make their own choices.

7.45 pm

We need to attack the second wage if we have to find money from within the income tax system. There are people in our society, particularly teenagers living with their mothers and fathers, who are responsible for the household expenses, who are earning a full adult wage and yet do not have much to spend that money on. They have no dependants and no rent to pay. Those are the people who are buying the Japanese electronic trash, motor cycle kits, cosmetics and many imports that they truly do not need. Five or 10 years later those same people may be extremely hard up. It is far better that they should contribute more to society while they can, and for society to give them more back at a later stage in their lives.

Mr. Tim Eggar (Enfield, North)

I do not disagree with the logic of my hon. Friend's argument, but how does he propose that that should be done?

Sir B. Rhys Williams

To answer that would take us beyond the limits of a guillotined debate. In a few words, I suggest that the Chancellor should make a sharp reduction in the amount of personal allowances across the board, and simultaneously introduce a householders' allowance, which would be payable to those responsible for rent, rates and particularly mortgages. I have worked out the figures, and my hon. Friend the Minister has them. I should be glad to provide a copy to my hon. Friend the Member for Enfield, North (Mr. Eggar) and anyone else who is interested. My recommendations are quite specific and they balance. If the Government were to decide to accept my recommendation that child benefit should be raised to supplementary benefit level, it could be paid for without undue hardship to anyone by the means that I suggest.

I believe that the Chancellor should abolish the 25 per cent. band in his Budget next week if he is seriously looking for money. There is no disincentive in so doing. The concession does nothing but complicate the collection of income tax. My personal preference would be that this year the Chancellor should not implement the Rooker-Wise-Lawson amendment, which would get the balance of tax concessions wrong. My priority is for the family and, from the numbers on our Benches, that appears also to be the priority of the Conservative Party. In his previous Budget the Chancellor seemed to forget families. This time he must put the balance right.

The logic of the way that the House is to vote is complicated. In my opinion, those who think that the Chancellor should agree to an uprating of child bene- fit to catch up with the rise in the cost of living will vote for the £5.20 amendment. If the Chancellor is planning to go further, our votes will simply help him on his way, and will do no harm. Those who are prepared to leave it to the Chancellor will abstain. That is perhaps a respectable position, but I shall be disappointed if too many hon. Members do that. Hon. Members who study these issues should make a decision. Those who definitely do not want child benefit to be raised in line with the change in the value of money will vote against the amendment.

I said that that was the logic of the position Of course, the issue is not so clear cut. I realise that those who vote against the amendment will be joined in the Lobby by many who have not followed the debate and who prefer to stick to the convention that the Chancellor can make his Budget judgment in his own time. For myself I believe that that would be wrong.

Unless my right hon. Friend the Minister is able to give us a clear undertaking in winding up that the Government intend that child benefit should be uprated this year to take full account of changes in the value of money since the previous increase, I shall vote for new clause 9.

Mr. Andrew F. Bennett

I welcome the two speeches from the Government Benches, which indicate that at least two hon. Gentlemen will be voting for new clause 9. I was a little concerned that the hon. Member for Watford (Mr. Garel-Jones) said that although he would vote for the new clause, he hoped that his hon. Friends would pull him back from the brink of defeating the Government.

I am sure that no right hon. or hon. Member wants to see the Government defeated. We would much prefer a guarantee that child benefit will be increased to £5.20. If we could arrive at that without a vote, I am certain that we on the Opposition Benches would be happy. When the hon. Member for Watford has had more time in the House, his experience will be that the only effective way to make certain that Governments take notice of Back Benchers is to vote.

When I first came to the House and was on a Committee discussing the Child Benefit Bill, I accepted assurances from Ministers which I now bitterly regret. Of course, Ministers come and go, and after they have given assurances it is difficult to hold their successors to them. The only effective way is to attempt to force the Government in the Division Lobby and to make sure that as many as possible of one's right hon. and hon. Friends support the move. That does not actually force the Government to do anything. The Government merely have to make a choice about the seriousness of the action. If the Government wish to, they can bring us back two or three days later on a vote of confidence and make us vote the other way. It is as simple as that. But on most occasions, if we show the Government the strength of our feelings and an amendment is carried, they will take that into account and will not bring us back and make us vote the other way.

That is the choice. It is far better to go into the Division Lobby hoping that the £5.20 will be carried, than simply hoping that one will be saved by one's right hon. and hon. Friends and that the Government Front Bench will be so impressed by the strength of feeling that it will do it in the Budget, anyway.

At the start of this debate we hurriedly pushed through, or at least did not debate, new clauses 2 to 8. My name was on all but one of those—new clause 5—which is the one that I should most like to have seen included. That illustrates that hon. Members appreciate that although much can be done to improve the Bill, what is most important for families with children is to increase child benefit. In allowing those clauses not to be debated, we were simply stressing, in a guillotined debate, that it was most important to have child benefit increased.

Over a long period the merits of child benefit have been debated again and again and we have failed to achieve the necessary action on them. For years and years people accepted that families with children should receive tax relief. It was argued that those families that were not paying tax had just as many, if not more, needs; so the idea was put forward to develop child benefit or negative income tax.

Those arguments were made and won in the 1960s, yet it has taken us 10 years —the whole of the 1970s—to achieve a child benefit allowance of any significance. We are now fighting merely to ensure that that benefit is brought up to date with inflation by £1.20. We are still not into the argument of increasing it to the realistic level that new clause 5 proposed.

We pressed hard in Committee to get this benefit increased to the minimum child dependant's allowance for supplementary benefit—the level that is really necessary, the level that has most administrative advantages, and the level that does most to defeat the poverty trap and ensure that whether people are working or drawing benefit their incomes for their children do not rise or fall.

If we could increase child benefit to a realistic level, the advantage would be that many of the other benefits paid out for children on a means-tested basis could be eliminated. We could simplify the system a great deal. In new clause 2 we suggested that we might be getting a little way there with £6.

It is important that the House should vote for the £5.20 tonight and say that after all the arguments we do not intend to slip back this year, but hope that in future we can increase child benefit to a level where it will remove families with children and the working poor from the poverty trap.

Mr. Paul Dean

April 1979 was an important turning point, as I see it, in both the social security scheme and the tax relief arrangements. One of the reasons why we are having this debate is that we have not yet fully worked through the logic of that change. There are some who regard the changeover to the child benefit scheme with a cash payment to the mother as a first step towards the tax credit scheme that was originally proposed by a previous Conservative Administration. On the other hand, there are those who regard it as a botched-up scheme, which means that personal taxation has to be kept higher than it would otherwise be to pay out a cash benefit.

Whichever side of the argument one is on, the fact is that we now have child benefit. It is the main mechanism for assisting parens in work with dependent children. In my view, therefore, the logic is that it should now be regarded as an inherent part of the social security scheme.

Child benefit should be uprated on an annual basis in line with the other benefits in November.

There is another equally important factor, and that is the need to link the rate of child benefit with the dependency benefits within the national insurance and supplementary benefit schemes. If the dependency benefits are increased annually, as they are, and child benefit is not, these benefits are bound to get out of balance. Therefore, we get the aggravation of the poverty trap and a reduction in the incentive to work—the "Why work?" syndrome. All these matters are of significance to the one-parent family.

Therefore, there is a clear case for this benefit to be linked with the social security scheme and cease to be the odd man out that it is at present. Alternatively, child benefit should be linked with a man's tax allowance arrangements, which again are looked at on an annual basis. So whatever way one looks at it, it would seem that there is the strongest possible case for annual review and a clear link between child benefit and either the social security scheme or the tax allowance arrangements.

As has been said by my right hon. and hon. Friends and by Opposition Members, there is a strong argument this year for restoring the value of the child benefit, since it was last increased in April 1979. In my view, it is right to restore the relativities and to assist the working family with dependent children. It is a high family priority, it is a high social priority, and it is also important in providing incentives to work and for wealth production in present circumstances. In my view, the argument is overwhelming.

I cannot help reflecting on the strange episode that we had at the beginning of this debate, when the right hon. member for Salford, West (Mr. Orme) threw away new clause after new clause with gay abandon, apparently in order to accept the wisdom of a figure that had been put on the Notice Paper by some of my hon. Friends. I should like to put this reflection to the House: it seems to me that within about a week—

Mr. Orme

I am sure that the hon. Member does not want to be unfair in his argument. I remind him that he is speak- ing to new clause 9, which is in my name and the names of a number of my hon. Friends.

8 pm

Mr. Dean

I intended the remark to be good-humoured. The right hon. Gentleman abandoned a number of new clauses at the drop of a hat. Some of the clauses contained conflicting figures. I do not want to make too much of that.

Is it reasonable and right for the House to bind on one issue the Chancellor of the Exchequer, who is within a week of his Budget speech? We all hope confidently that there will be an announcement in my right hon. and learned Friend's speech next week about increases in pensions, widows' benefits and in benefits for the disabled and the sick. We hope that there will be an announcement about what is to happen to tax allowances, including the Rooker-Wise provision.

It has emerged clearly in the debate that there should be a clear link and the right balance between child benefit and the other benefits that my right hon. and learned Friend will be announcing next week. It would be unwise of the House to try to bind my right hon. and learned Friend to a specific figure on child benefit when we are so near to the Budget, in an attempt to achieve the right relativities and the right balance.

I hope that my right hon. Friend the Secretary of State for Social Services will be able to help the House in view of the obvious strong feeling that exists on both sides of the Chamber but that is reflected especially on the Government Benches. Throughout the whole of the debate there have been at least twice as many Conservative Members as Labour Members in the Chamber. I hope that my right hon. Friend will be able to give a definite iindertaking—I do not regard it as reasonable at this stage to ask for such an undertaking on a specific figure—that there will be a substantial increase in child benefit, in view of the strong arguments that have been advanced.

Dr. Oonagh McDonald (Thurrock)

I too, shall be as brief as possible. I note that it is recognised on both sides of the Chamber that child benefit provides the best means of helping the family. The benefit has been strongly commended. I hope that many Conservative Members will feel able to support the new clause in the Lobby, or at least to abstain, so that the message of the value of child benefit is brought home firmly to the Government, and especially to the Chancellor of the Exchequer in the last few days before the Budget.

It is true that child benefit appears to be an expensive benefit. To increase it by 1p for each child in 1980–81 would cost £5.6 million. To increase it by 10p would cost about £56 million in that year. The cost would be rather less than the Under-Secretary of State, the hon. Member for Wallesey (Mrs. Chalker), intimated in a recent answer.

In spite of the costliness of the benefit to the Exchequer, it is vital that it is increased. By April the £4 child benefit will be worth about £3.20. The real value of child support for the standard rate tax paying family will be much lower in April 1980 than in all the years between 1950 and 1966. In other words, our support for families, apart from 1979–80, has fallen. It will need the Chancellor of the Exchequer to take the sort of action that is proposed in the amendment and raise child benefit sufficiently to reflect the commitment to support families that was known in earlier years and in the last year of the previous Labour Government's administration.

Whether we increase child benefit to £6 or adopt the £5.20 proposal of Conservative Members, it is worth setting out the costs of keeping a child. The May 1980 costs have been estimated. The estimated cost of a two-year-old child is £7.84 a week. The estimated cost of an 11-year-old is £11.55 a week. If child benefit is increased to one or other of the proposed figures, it will go nowhere near fully maintaining a child, certainly a child of 11 years of age.

We are pressing for an immediate increase in child benefit. That is the right step for us to take. However, in future we must ensure that the child benefit scheme is examined thoroughly. We must ensure that it is uprated annually and that gradations are introduced to take account of the fact that at certain ages children cost very much more. That is what we should aim for in future. To fight to increase the benefit above the £4 level is perhaps sufficient for the moment.

An anxiety has been expressed to help the Secretary of State as much as possible. In the past he has made extremely clear his commitment to child benefit and the need to support families. In earlier times, in "The Great Child Benefit-U-turn", he indicated that he understood well the principles involved in engaging in a fight with the Treasury over the issue of raising child benefit, a costly benefit in terms of public spending. The right hon. Gentleman said that a commitment to treat increases in Child Benefit in the same way as reductions in taxation is extremely important. He argued that once the switch from child tax allowances to child benefits had been completed, there should be 'an improvement in the real value of child benefit as part of an overall reduction in the burden of direct taxation and a shift to indirect taxation'. I hope that the Secretary of State will hang on firmly to the concept of child benefit being part of an overall reduction in the burden of direct taxation. Perhaps even in the past few days he has been able to discuss with the Chancellor the issue of increasing child benefit. I hope that he has been able to encourage his right hon. and learned Friend so to do.

Conservative Members seem to regard child benefit as an important work incentive and as a way of discouraging people from coming out of employment and relying on social security. I have never felt that the tax incentive argument has been an important motivation in keeping people in or out of work. To regard child benefit as a reduction in the burden of direct taxation is important. It helps working families in general. It helps ordinary and low-income working families. In particular, it is a means of helping families that are caught in the poverty trap. The right hon. Gentleman will no doubt recall that answers have revealed that his Department expects an unprecedented increase in the number of families caught in the poverty trap during this year. It is estimated that the level will reach at least 90,000. It is some time since that answer appeared, and it may be that the number has increased already.

I must warn the right hon. Gentleman that when I asked the Chancellor if he would adopt the practice of treating an increase in child benefit in the same way as a reduction in direct taxation, rather than as an increase in public expenditure for accounting purposes, the Chief Secretary replied: No. Child benefit is a cash transfer from the public to the private sector which is voted by Parliament as public expenditure and is so treated in national accounting."— [Official Report, 21 December 1979; Vol. 976, c. 450.] That is an important issue. It appears from certain indications that, in the forthcoming White Paper, reductions in taxation through tax allowances of various sorts will no longer appear as tax expenditures. That means that the Chancellor can sneak in money to assist rich people, the better-off, in a variety of ways. That does not appear to be the position when we examine closely the Chancellor's White Papers, whereas an increase in child benefit appears as an increase in public spending.

I hope that the Secretary of State will recall his earlier words and lean on the Chancellor of the Exchequer to adopt the method whereby tax expenditures are used as a way of indicating the money spent on, say, tax relief on mortgages to show this as Government spending in terms of the lost revenue. I hope that the Secretary of State will recall his words and encourage the Chancellor to regard the increase in child benefit as a reduction in direct taxation. Armed with the arguments that he put forward so strongly earlier today, I trust that the right hon. Gentleman will press the Chancellor to ensure that child benefit is raised at least to the level proposed by many of his hon. Friends, if not to the level proposed by the Opposition.

Child benefit was one of the most important measures introduced by the Labour Government. It is one of the most valued and appreciated of benefits and one of the most widely and effectively used benefits for helping children and mothers. When mothers are asked what they do with child benefit, they say that they put it away to buy shoes for their children or use it in the middle of the week to buy food for their children for the rest of the week. I see that Conservative Members agree. That means that replies from their constituents about how child benefit is used are exactly the same as the ones which we have received.

If the Government really want to be known as a Government who assist the family, the raising of child benefit now and the use of the arguments formerly advanced so forcefully by the Secretary of State when he was in Opposition are what we wish to see them undertaking.

Mr. Richard Needham (Chippenham)

My reasons for signing the amendment were that I felt that child benefit was of vital importance to the families of the long-term unemployed, particularly when we read rumours in the press that the earnings-related supplement may be abolished and that supplementary benefit may be de-indexed.

Other disadvantaged groups, such as one-parent families and old-age pensioners, have strong supporters. The problems facing the long-term unemployed were summed up by the Supplementary Benefits Commission in its report in 1977.

Paragraph 2.15 said: It is the unemployed claimant with children who is generally the poorest of all. In the light of the Government's economic policy and their determination to rationalise the economy, to reduce overmanning and improve productivity, and to deny State support for lame ducks, the immediate effect on the next two years must be dramatically to increase the numbers of people out of work and further to increase the problems of the poorest section of society, namely, the long-term unemployed.

8.15 pm

I believe, therefore, that an increase in child benefit in line with inflation is vital to those seeking work. As many right hon. and hon. Members have said, the benefit is no disincentive to work, since it is payable to those in work and out of work. It is perhaps not always fully appreciated that the long-term unemployed are not entitled to long-term benefit. At the moment, with average earnings for a married man with two children of £98, when a man loses his job his basic entitlement falls to £48.15. Above that, he receives an earnings-related supplement of £14.75. Any benefit above that is means tested. I refer again to the report of the Supplementary Benefits Commission for 1977. Paragraph 3.10 states: For the unemployed it is no straightforward matter to claim supplementary benefit. Their claims can be amongst the most diffi- cult to deal with, posing complex questions about the treatment of last wages and the interaction of supplementary benefit with possible awards of unemployment benefit. Questions must also be asked about circumstances giving rise to the loss of the last job which may affect the amount of benefit. Unemployed claimants are required to deal with three separate offices: one for supplementary benefit, one for unemployment benefit, and one for job-seeking. The difficulties facing the unemployed in obtaining benefit—should child benefit be increased—would not be quite so great.

If we compare today with the 1930s and take the figure that I have just given, of £62.90 compared to an average wage of £98, we see that in the 1930s the corresponding figures were 52s. 6d. as the average wage of a married man with two children and benefit amounting to 30s. The argument that could be put forward for de-indexing the supplementary benefit might be that it was only right that everyone should share current hardships.

My answer to that is that there is a level of poverty in our society at which the State should intervene and below which people must not be allowed to fall. Surely it is the basis of the Conservative Party's philosophy that the State has a duty to help those who cannot help themselves. The long-term unemployed are, according to all the figures and all the evidence, those who most require that help.

For that reason, I believe that it is of great importance that child benefit should be increased in line with inflation. I shall not vote against the Government, since the only indication that I have of a change of heart on their part, from their previously stated policy, is based on rumour. However, I believe that arguments, particularly on behalf of the unemployed, are much better put forward before the Budget than after it.

Mr. Field

I shall spend a few moments only in commenting on the importance of this debate. Whatever the outcome of the vote, the Secretary of State will go away very pleased. The debate on child benefit has entered a new era. There are more Conservative than Labour Members in the Chamber—that is not a normal phenomenon in welfare debates. I think that it is fair to say that at this stage there would probably not be as many hon. Members in the Chamber for most other Bills as there are for this one. We have entered a new era in our debate on supporting families and for everyone, inside and outside the Government, that should be welcomed without reservation.

Because the technicalities of the debate have been won, I should like to spend a few minutes directing our thoughts in another direction. We are now experiencing the luxury of being able to talk about the kind of society that we are trying to create with the help of a generous system of child benefit. There are three powerful arguments why, if the Chancellor of the Exchequer has any sense at all, he will not stop at £5.20.

We spend much time in this Chamber talking about freedom, but we rarely bring that concept down to earth and ask how we can extend freedom in a practical way. Child benefit is important because it extends freedom to a greater proportion of the population. It takes power away from Whitehall and gives it to mothers. The society that I wish to see is not one in which politicians or bureaucrats make the decisions, but one in which the decisions are taken by individuals and by families. On the issue of freedom, this is an important debate, as will be the Budget that is to follow.

We are discussing the kind of Welfare State that we should like to see. Child benefit has an important part to play in that State. I wish to see a Welfare State which acts as a floor on which people can build by their own efforts and where they are not penalised for doing so. That combined arguments from both the Left and Right. The Left's argument is that it is important to have the floor of protection for those who fall. The Right-wing argument is that in the society in which we live and die people want to improve the lot of their families and that it is foolish to try to restrict that freedom and incentive too much.

Before my Front Bench dismisses me as a true Right-winger I emphasise that there is a difference in the type of society that we want to build. Some hon. Members try to take the argument back to the 1920s, when the emphasis from Socialists was on the individual and not on the collective. That is a struggle in my party, and the help that we sometimes get from the Conservatives is sometimes of use.

We are making decisions about families. We are saying that the best way to raise children is in families. Many criticisms can be made of a family unit, but nobody has come up with a better way of raising the next generation. If we believe that, we must be straight and give the family unit the resources to do a good job.

We are moving from arguing in detail to discussing the overwhelming advantages of child benefit. Child benefit extends freedom in a real and practical way. It helps to create a Welfare State which is a floor on which people can build their own efforts. In a practical way it helps to build strong and effective families.

Mr. Tom Benyon (Abingdon)

In the 104 hours which I enjoyed in Committee I learned a tremendous amount, especially from those who work profesionally in the social services and those who have been involved in them politically. In Committee hon. Members were in broad agreement on a number of issues. We were agreed about the importance of child benefit. There also appears consensus on that subject in the House.

In a previous incarnation, my right hon. and learned Friend the Chancellor of the Exchequer spoke eloquently about the need to operate a child benefit scheme. My right hon. Friend the Secretary of State for Social Services and the National Women's Commission have also recognised the importance of uprating child benefit. In 1977 the Secretary of State spoke so eloquently about child benefit that I can do no better than to quote him. According to the pamphlet "The Great Child Benefit-U-turn" he said: First, that child benefit was important because that is the way to restore the position of families. Secondly, it is the best way to ease the poverty trap. Thirdly, it is the best way to help the poorest families in work—those who earn their poverty. Fourthly, it is the best way to reduce the nonsense of people being much better off out of work. Fifthly, it is the best way of reducing the dependence of families on means-tested benefits. I cannot better the description of the importance of child benefits. I cannot believe that the Secretary of State, whose lips were just moving in time with mine, does not still agree with what he said then.

I wish my right hon. Friend good fortune, as St. George sallying forth to wage battle with the Treasury dragon, in his struggle. I must dispel the rumour which I fear has been put about by our political opponents. It is not true that the Tory policy of caring for the family has died. That rumour is much exaggerated. There is a consensus in the House. Based on Christian doctrine, there is a belief in the family unit. All policies, fiscal and domestic, should be viewed with the family unit in mind.

I have re-read the excellent speech which the hon. Member for Birkenhead (Mr. Field) made on the ultimate day of the Committee on the Bill. I had hoped that he would not be quoted before me because that would have disembowelled my speech. He spoke about the freedom of the family. He said that despite its drawbacks and problems the family unit was the best method that we had to raise children happily.

I wish to dispel a myth about child benefit. The myth is that child benefit is a form of soup kitchen or disreputable hand-out which is used and abused by scroungers and wasters alike and which is handed indiscriminately to those who can afford to do without it. That myth has been dismissed by right hon. and hon. Members on both sides of the House and I shall not dwell on it. However, the finest accolade and the finest act of the previous Administration was to give child benefits in cash payments to mothers. Before that, although the State recognised the importance of the family unit through tax allowances, the well-off prospered because they paid substantial income tax and the poor who paid no tax did not benefit. Now the mother is paid in cash. The system shows that the State recognises the importance of children and it represents the beginning of a tax credit system. Long may it continue.

An uprating in the child benefit is in tune with current Conservative philosophy, as it is a tax cut for the poor. Surely that is the only way in which it can be given. If the benefit is not uprated in line with inflation it will lag behind so that next time, when a Chancellor of the Exchequer wishes to uprate it in line with inflation, the increase will have to be even larger and therefore harder to make. Two other benefits have lagged behind in the last 10 years. The maternity and death grants have been ignored by Chancellors for the last 11 years. Those grants, like icicles in strong sunshine, have melted away. It is now much more difficult to uprate those grants so that they relate to 1969 prices. If those grants had been uprated gradually the problem would not be so difficult.

The £4 currently granted for a child will be worth £3.20 in April, £3 in November and goodness knows what this time next year. The family unit has suffered considerably since 1948. The single person's tax allowance in 1948 was £100. It has risen to £800. However, the allowance for a family with children has risen only from £100 to £400. The family with children has done much worse than the single person.

Since May there has been a further problem. The family has come under increasing attack. The tax cuts given in the previous Budget were obviously splendid. It would lie ill in my mouth to say otherwise.

Mr. Field

Does the hon. Gentleman agree that families should have received their share of those tax cuts—we already have child benefit at £5.70 a week—and that they were left out?

Mr. Benyon

I take the hon. Gentleman's point. The poorer family unit is not earning enough to benefit from the tax cuts. However, it pays increased VAT, although to be fair a substantial proportion of its expenditure goes on goods which are VAT exempt. However, there are increases in rent, rates, gas, electricity and school meals. But for the grace of the House of Lords there was nearly an increase on transport. The social services have been cut back. The cuts are falling not on the administration but on the services. There are problems of increasing unemployment. If there are cuts in child benefit in real terms compounded on top, one despairs for the future of our poor families.

8.30 pm

To uprate child benefit to £1.20 is the least we can do. For children over the age of 11 the figure would need to be £1.30. We justify the cost, first, on grounds of healthy children. Second, proper levels of child benefit would be a real contribution to reducing delinquency and emotional problems in families. The financial pressures placed on families which are short of money lead to increased levels of rates of divorce. We should measure the extra money that that would cost. We must also take into account the cost of institutional care. From the compassionate point of view, the borderline between hunger and anger is thin. When families suffer tremendous financial constraints I am not surprised at the increase in child abuse and child battering.

The hon. Member for Birkenhead (Mr. Field) quoted Churchill as saying that the levels of family benefit should provide a floor below which families should not fall. One can hardly improve on that well-known figure of speech.

The problem facing the Chancellor, if child benefit is to be uprated, is how it should be paid for. As the Conservative Party said in the election, we as a country are spending £9,000 million more than we are earning. There are two methods of doing that—either printing money or creating wealth. We believe that a precondition of social concern and expenditure on social concern is the creation of wealth. That presents a problem, the reasons for which I shall not discuss now. The Chancellor is faced with the considerable problem of how to pay the extra £6 billion if family child benefit is to be uprated.

Mr. Garel-Jones

It is £600 million.

Mr. Benyon

I thank my hon. Friend for correcting my inflated figures.

I do not presume to tell my right hon. and learned Friend the Chancellor how to expand his cake. He might consider the Rooker-Wise amendment to see how that may be done. I do not believe that the Conservative Party, with its fine history of social concern, will do a U-turn on this subject. It would be wrong for us to presume that my right hon. and learned Friend the Chancellor and my right hon. Friend the Secretary of State for Social Services would not face up to the obligation that our party and they, as individuals, entered into before we came to office in the last election. I do not believe that the promises that we gave before the election on this important matter will turn to dust.

This has been a vital debate. I found it stimulating. I hope that my right hon. and learned Friend the Chancellor and my right hon. Friend the Secretary of State will take that point to heart. I shall listen to the speech in winding up the debate with great fascination. I am not declaring which way I intend to vote until I have heard it.

Mr. David Stoddart (Swindon)

I am pleased to speak following my "hon. Friend" the Member for Abingdon (Mr. Benyon). He is my near neighbour and he has quite clearly understood the effect that the last Budget had on families, especially those with children. Undoubtedly families with children are burdened with additional costs, including VAT. They are suffering at present.

I am particularly pleased that there are so many Conservatives here this evening who have not forgotten the manifesto promises to look after the family. Those promises are important because, as has been said by so many, the family unit is an important linchpin of our society.

I am also pleased to hear that they at least are not among those who believe that children are a liability, because children are not a liability but an asset; they are an asset to families themselves and to the nation. Indeed, we must for ever remind people that that is so.

I will be brief, because I know that the Secretary of State wishes to make an important statement, but I want to confess that when child benefit was first mooted I was one of those who were against the proposal. The reason was that I believed that Governments of various colours would not meet the promises that had been made when the change was made from tax allowances and family allowances to child benefit. So, in fact, it has proved, and families with children have fallen behind. The child benefit itself has fallen behind, and, as we see from the amendments, needs to be considerably uprated.

What is more, there are people—I fear that the Prime Minister is among them—who believe that child benefit should he a means-tested benefit. I hope that the Secretary of State and his colleagues will be able to convince the Prime Minister and other Ministers who think similarly that it was intended to be not a means-tested benefit but a universal benefit, and that, indeed, should remain the case.

I hope, therefore, that hon. Members of all parties will go into the Lobbies to ensure that child benefit is increased, that we shall not have to wait for a Budget announcement and that the House will make it clear to the Government to- night that it intends that families with children should be protected and that child benefit, too, should be protected.

Mr. Peter Bottomley

I am most grateful both to my right hon. Friend and to the right hon. Member for Salford, West (Mr. Orme) for making this debate possible, so that the House can come to a decision. It seems to me that the debate is taking place at the right time, because I believe that the Cabinet will be taking a decision on child benefit during the next few days. I pay no attention to the malicious rumours spread by enemies of the Treasury that it is considering an increase of only 75p, because that would be a net reduction of about 63p on what the child benefit increase needs to be if the gap between the child benefit for people at work and that for people out of work is to remain the same. In practice, we need to close that gap over the next five or 10 years, which by my calculation on the retail price increase over 18 months, requires an increase of at least £1.63. That is why I should not mind if, by mistake or intentionally, the House passed this new clause tonight and got £1.20 introduced as a minimum.

When one party offered a £4 increase to pensioners during the last election campaign, another party offered nothing but gave an increase of £6. If the House approves £1.20 tonight, I hope that my right hon. and learned Friend the Chancellor of the Exchequer likewise will say next week that he wants the House to vote for £1.60. He will have a second opportunity to surprise the House.

I hope that the Chancellor will recognise that those of us who are voting in favour of £1.20 are willing to offer suggestions as to where the money can come from. Using tax and the prices index for personal allowances is a suitable way of saving some money, and abolishing the 25 per cent. rate of tax is another. For other suggestions, I refer the Chancellor to an article I wrote in "Crossbow", published this week, which offers other suggestions as to how a large amount of money could be saved. The £1 increase in child benefit last year was not a £1 increase, because of the withdrawal of the residual tax allowances. The number of children covered by child benefit next year will be lower than the number covered this year.

Child benefit needs to be increased for many reasons, but the greatest reason is the implication for public expenditure and pay increases of 20 per cent. next year when we shall be running at least 17 per cent. ahead of production. If we want to get our trade unions to accept levels of pay increase below the rate of inflation, it is essential that child benefit should rise by more than the rate of inflation for this year, so that people will be encouraged to accept lower rates of pay next year.

Mr. Clement Freud (Isle of Ely)

I was delighted to hear the "Tribune group" of the Conservative Party giving such splendid support to the argument that traditionally comes from the Opposition. The position of my right hon. and hon. Friends on child benefit and index linking is well known. We have heard arguments that would have us believe that increased child benefits will cure anything with the possible exception of athlete's foot. I agree.

Child benefit is the most effective of all benefits. It endorses the State belief in the power of mothers and the devolution of power to mothers. I accept and endorse the argument put forward by the hon. Member for Birkenhead (Mr. Field) that it creates a floor below which we should not and must not fall.

Hon. Members on both sides of the House will, I am sure, realise how hard pressed is the Department of Health and Social Security. We all have sympathy with, rather than contempt for, the Department for taking so long to answer letters. I mean that quite genuinely because I know what enormous pressure of work there is on the DHSS. I ask the Government Front Bench to bear in mind that some of that pressure will be removed because the consequence of increasing child benefit will be that the take-up of a number of other means-tested benefits will fall. A significant or, at the worst, an index-linked increase in benefit will be appreciated not only by both sides of the House, but by the Department and its staff.

Mr. Patrick Jenkin

I well remember speaking in the House, I think in a Finance Bill debate, from the Opposition Front Bench and totally misjudging the tone of the House. I received a letter the next day from the late fain Macleod, who had listened to me in some pain, in which he said that the House could be as fickle as a trout.

I had totally misjudged the way in which today's debate would go. I pay tribute to the right hon. Member for Salford, West (Mr. Orme) for the reasonable way in which he moved the clause. I congratulate right hon. and hon. Members on both sides of the House on the ingenuity with which they managed to get the debate on the new clause which they wanted, although I hope that in the event it will not make the difference they might have thought.

I welcome, too, the fact that the debate has taken place, not least because it has enabled right hon. and hon. Members on both sides to put on record the case for the payment of child benefit as part of our social security system. The House will have been impressed by the contribution made by hon. Members on both sides who did not take part in the debates before the last election because they were not here—my hon. Friends the Members for Watford (Mr. Garel-Jones), for Chippenham (Mr. Needham) and for Abingdon (Mr. Benyon) and the hon. Member for Birkenhead (Mr. Field), whose remarkable speech when child benefit was debated in Committee I have read.

8.45 pm

I do not think I have heard a single argument from either side, with the possible exception of that of my hon. Friend the Member for Kensington (Sir B. Rhys Williams), whose antecedents are of immense respectability and some antiquity, which I have not at some stage adduced myself in support of child benefit The House has dealt kindly with me in the sense that few hon. Members on either side have felt it right to quote at length from my speeches. I have some quotations myself, I might say, from the right hon. Member for Salford, West (Mr. Orme) the right hon. Member or Norwich, North (Mr. Ennals), Mrs. Barbara Castle and others. I shall forswear the pleasure of quoting them, because the House has dealt gently with me.

I should like to put the figures on the record. I had the impression that the right hon. Member for Salford, West was not too clear about the cost of new clause 2. An increase of £1 in child benefit from £4 to £5 would cost £210 million in the next financial year, 1980–81, and £560 million in a full year. The figure of £5.20, which is the subject matter of new clause 9 and amendment (a), would cost £250 million in 1980–81 and £670 million in a full year. The figure of £6 to which the right hon. Gentleman displayed his closest attachment, in new clause 2, would cost £420 million in 1980–81 and £1,120 million in a full year. To complete the picture, I should perhaps give the cost of accepting new clause 5, to which my hon. Friend the Member for Kensington spoke The cost would be £650 million in 1980–81 and £1¾ billion in a full year. By any standards—

Mr. William Waldegrave (Bristol, West)

I am grateful for my right hon. Friend's courtesy in allowing me to take part in a debate that might not have taken place in quite this form. Will my right hon. Friend confirm the figures given to me by my hon. Friend the Under Secretary, when she estimated, in an answer hedged with sensible caveats, that there was a considerable saving in supplementary benefits to be netted from those figures? She estimated that for £1 of child benefit there would be a figure, in a full year, of £60 million to be netted.

Mr. Jenkin

If my hon. Friend gave those figures, that is the best estimate that we can make. I take my hon. Friend's point. One has to recognise, in relation to child benefit, that Governments of both parties have had to wrestle with the fact that, although we address ourselves, as many hon. Members have done, to the problems of families at the margin, poor families and families who earn their poverty, and although we talk in terms of the impact on incentives, child benefit is a universal benefit, as my hon. Friend for Abingdon stated. There is no soup kitchen about this matter. It goes to families right up the income scale. The hon. Member for Birkenhead first used the phrase "Families who earn their poverty" although I get the credit in the Financial Times this morning, wrongly, for having invented it.

Because child benefit goes to families right up the income scale, the cost, even after taking account of offseting savings on supplementary benefit, is a very substantial element. This is the situation that Governments of both parties have found themselves facing when they come to grapple with the problems of child benefit.

I wish to answer the point raised by the hon. Member for Thurrock (Dr. McDonald), which was raised also by my hon. Friend the Member for Kensington. Both argued that child benefit should eventually reach the level of supplementary benefits. With respect, I am not sure that that is the right approach. I do not think that there is any division between the two Front Benches on the matter. From its inception, child benefit has never been seen as anything more than a contribution towards the cost of bringing up children.

Mr. Freud

indicated assent.

Mr. Jenkin

I am grateful for the assent. Mrs. Castle, when speaking in the debate on the Child Benefit Bill in 1975, said. It does not claim to cover the whole subsistence need of a child."—[Official Report, Standing Committee A, 24 June 1975; c. 161.] I find it interesting that she was answering a question from my hon. Friend the Member for Kensington. I recognise that even the supplementary benefit figures do not succeed in meeting that need, though that is the objective in theory.

A point about procedure was raised by the right hon. Member for Norwich, North (Mr. Ennals), when he spoke about the difficulty in phasing in child benefits. That subject was touched on by my hon. Friend the Member for Somerset, North (Mr. Dean), when he said that child benefit should either be tied each year to the increase in social security benefits, or tied each year to the changes in the personal allowances for income tax. As I suggested in an intervention during the speech of the right hon. Member for Salford, West, there is an overwhelming argument for the former treatment as long as we maintain anything like the present machinery for payments of child benefit. The new rate of child benefit has to be announced months in advance of the day on which it will become effective because of the sheer mechanical problem of printing and distributing the child benefit books. Perhaps one day, with the full use of the micro-chip, it will be possible to uprate such a benefit as quickly as one can deal with tax tables and PAYE.

Mr. Peter Bottomley

Surely my right hon. Friend means that the timing of the increase should be linked to social security benefits, rather than the increase itself being linked to social security benefits. If we are trying to close the gap between sickness benefit paid in respect of children and the child benefit for those at work, we should ensure that the increase in child benefit rises faster than the increases in social security benefits.

Mr. Jenkin

We are not discussing that problem. I was talking about timing. It is convenient to make an announcement at the time of the Budget, and for the uprating to take place at the same time as the increase in social security benefits. Provided there is an offsetting difference between the benefits, which we are bound to have for several years yet, that operation can be carried out once each year instead of twice.

Mr. Ennals

I am sorry that I did not hear the first part of the Secretary of State's speech. Does he agree that there is every advantage, at the right time, in being able to index-link child benefit so that it does not require some new decision each year about its level compared with other benefit levels?

Mr. Jenkin

Interestingly enough, that is an argument that the right hon. Gentleman found himself resisting fairly substantially during the lifetime of the previous Parliament. I do not have the relevant quotation before me, but the matter was stated clearly by Mrs. Castle when debating the Child Benefit Bill, when she said that if everything was indexed it would make no difference to anybody. There is a general feeling that if we continue to index more and more and more, we shall end up in the same position as Brazil and Israel, with a 100 per cent. rate of inflation—[HON. MEMBERS: "Milton Friedman".] I do not think that Milton Friedman ever recommended that.

The decision on the amount of the up-rating of the child benefit should be considered at the same time as decisions on increases in personal tax allowances, on the rates of taxation and on the question of changes in indirect taxation. If the Government are considering increases in other social security benefits, all the logic points to the child benefit uprating being considered at the same time. Because the last increase was in April, and coincided with the final phasing out of the child tax allowance, the question was whether one had a seven-month gap or a one-year seven-month gap. We have had the argument over and over again about the Labour Party's proposal of 50p. There was no provision for that.

I said earlier that I had not changed my views and that I did not recant on anything that I said in the last Parliament. Child benefit is an essential element in achieving a proper relativity between families with children and those without. It is the best way of helping families—

Mr. Freeson

We all accept the point that the Secretary of State is making, which is reaffirming what has been said in debate. We would be interested to know whether—without necessarily having any figures—it is the Government's policy this year to make good the value of child benefit in order to keep pace with inflation.

Mr. Jenkin

I shall come to that. Hon. Members have adduced all the arguments about incentives, the work syndrome and the poverty trap. The argument was also advanced about putting cash into the hands of mothers. I have advanced all these arguments myself and I do not recant a single word. But what could I be expected to say about the level of child benefit? Surely the whole logic of the argument of paying child benefit, together with the other social security benefits and tax allowances, is that the Government, the House and the country can judge whether the right decision has been made on any single element only if they can see it in the context of the whole. Of course we must have regard to the borrowing requirement and the impact on the economy generally. Of course we must have regard to the different impact of taxation, allowances and benefits on families of different compositions and with different incomes. Only when one sees all that together, can one form a judgment.

I understand and have sympathy with all the arguments put forward, and with the feeling that the amendments would help to pin the Government down on one element out of the entire spectrum of benefit. But just eight days before the Budget it would not make any sense at all if we adopted this course. It is not a matter of leaving the question entirely to my right hon. and learned Friend the Chancellor of the Exchequer. These issues have been thrashed out over many months between Ministers in the Cabinet. When my right hon. and learned Friend presents his Budget to the House, as he will do a week tomorrow, he will put forward his proposals on taxation, and the Government's main proposals on benefits including child benefit, pensions, benefits for the disabled, and others as well. It will be done in the context of the overall economic judgment, the size of the public sector borrowing requirement, and everything else. I have taken the most careful

note of what has been said about the importance attached to child benefit. The House may be certain that these matters are—

It being Nine o'clock, Mr. DEPUTY SPEAKER proceeded, pursuant to the Order [25 February] and to the Resolution this day, to put forthwith the Question already proposed from the Chair.

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

The House divided: Ayes 252, Noes 296.

Division No. 232]	AYES	[9.00 pm
Abse, Leo	Eastham, Ken	Kilfedder, James A.
Adams, Allen	Edwards, Robert (Wolv SE)	Kilroy-Silk, Robert
Allaun, Frank	Ellis, Raymond (NE Derbyshire)	Lambie, David
Alton, David	Ellis, Tom (Wrexham)	Lamborn, Harry
Archer, Rt Hon Peter	English, Michael	Lamond, James
Armstrong, Rt Hon Ernest	Ennals, Rt Hon David	Leadbitter, Ted
Ashley, Rt Hon Jack	Evans, Ioan (Aberdare)	Leighton, Ronald
Ashton, Joe	Evans, John (Newton)	Lestor, Miss Joan (Eton & Slough)
Atkinson, Norman (H'gay, Tott'ham)	Ewing, Harry	Lewis, Ron (Carlisle)
Bagier, Gordon A. T.	Field, Frank	Litherland, Robert
Barnett, Guy (Greenwich)	Fitch, Alan	Lofthouse, Geoffrey
Barnett, Rt Hon Joel (Heywood)	Flannery, Martin	Lyon, Alexander (York)
Benn, Rt Hon Anthony Wedgwood	Fletcher, L. R. (Ilkeston)	Lyons, Edward (Bradford West)
Bennett, Andrew (Stockport N)	Fletcher, Ted (Darlington)	Mabon, Rt Hon Dr J. Dickson
Booth, R' Hon Albert	Foot, Rt Hon Michael	McCartney, Hugh
Boothroyd, Miss Betty	Ford, Ben	McCusker, H.
Bottomley, Rt Hon Arthur (M'brough)	Forrester, John	McDonald, Dr Oonagh
Bottomley, Peter (Woolwich West)	Foster, Derek	McElhone, Frank
Bray, Dr Jeremy	Foulkes, George	McGuire, Michael (Ince)
Brown, Hugh D. (Provan)	Fraser, John (Lambeth, Norwood)	McKay, Allen (Penistone)
Brown, Ronald W. (Hackney S)	Freeson, Rt Hon Reginald	McKelvey, William
Brown, Ron (Edinburgh, Leith)	Freud, Clement	MacKenzie, Rt Hon Gregor
Callaghan, Rt Hon J. (Cardiff SE)	Garel-Jones, Tristan	Maclennan, Robert
Callaghan, Jim (Middleton & P)	Garrett, John (Norwich S)	McMillan, Tom (Glasgow, Central)
Campbell, Ian	Garrett, W. E. (Wallsend)	McNally, Thomas
Campbell-Savours, Dale	George, Bruce	McNamara, Kevin
Canavan, Dennis	Gilbert, Rt Hon Dr John	McWilliam, John
Cant, R. B.	Golding, John	Magee, Bryan
Carter-Jones, Lewis	Gourlay, Harry	Marks, Kenneth
Cartwright, John	Grant, George (Morpeth)	Marshall, David (Gl'sgow,Shelties'n)
Clark, David (South Shields)	Grant, John (Islington C)	Marshall, Jim (Leicester South)
Cocks, Rt Hon Michael (Bristol S)	Grimond, Rt Hon J.	Martin, Michael (Gl'gow, Springb'rn)
Cohen, Stanley	Hamilton, W. W. (Central Fife)	Mason, Rt Hon Roy
Coleman, Donald	Hardy, Peter	Maxton, John
Concannon, Rt Hon J. D.	Harrison, Rt Hon Walter	Maynard, Miss Joan
Conlan, Bernard	Hart, Rt Hon Dame Judith	Meacher, Michael
Cox, Tom (Wandsworth, Tooting)	Hattersley, Rt Hon Roy	Mellish, Rt Hon Robert
Craigen, J. M. (Glasgow, Maryhill)	Haynes, Frank	Mikardo, Ian
Crowther, J. S.	Heffer, Eric S.	Miller, Dr M. S. (East Kilbride)
Cryer, Bob	Hogg, Norman (E Dunbartonshire)	Mitchell, Austin (Grimsby)
Cunliffe, Lawrence	Home Robertson, John	Morris, Rt Hon Alfred (Wythenshawe)
Cunningham, George (Islington S)	Homewood, William	Morris, Rt Hon Charles (Openshaw)
Cunningham, Dr John (Whitehaven)	Hooley, Frank	Morris, Rt Hon John (Aberavon)
Dalyell, Tam	Horam, John	Morton, George
Davidson, Arthur	Howell, Rt Hon Denis (B'ham, Sm H)	Moyle, Rt Hon Roland
Davies, Rt Hon Denzil (Llanelli)	Howells, Geraint	Newens, Stanley
Davies, Ifor (Gower)	Huckfield, Les	Oakes, Rt Hon Gordon
Davis, Clinton (Hackney Central)	Hudson Davles, Gwilym Ednyfed	Ogden, Eric
Davis, Terry (B'rm'ham, Stechford)	Hughes, Mark (Durham)	O'Halloran, Michael
Deakins, Eric	Hughes, Robert (Aberdeen North)	O'Neill, Martin
Dean, Joseph (Leeds West)	Hughes, Roy (Newport)	Orme, Rt Hon Stanley
Dempsey, James	Janner, Hon Greville	Owen, Rt Hon Dr David
Dixon, Donald	Jay, Rt Hon Douglas	Palmer, Arthur
Dobson, Frank	John, Brynmor	Park, George
Dormand, Jack	Johnson, James (Hull West)	Parker, John
Douglas, Dick	Johnson, Walter (Derby South)	Parry, Robert
Douglas-Mann, Bruce	Johnston, Russell (Inverness)	Pavitt, Laurie
Dubs, Alfred	Jones, Rt Hon Alec (Rhondda)	Pendry, Tom
Duffy, A. E. P.	Jones, Barry (East Flint)	Penhaligon, David
Dunn, James A. (Liverpool, Kirkdale)	Jones, Dan (Burnley)	Powell, Raymond (Ogmore)
Dunnett, Jack	Kaufman, Rt Hon Gerald	Price, Christopher (Lewisham West)
Eadie, Alex	Kerr, Russell	Prescott, John
Race, Reg	Smith, Cyril (Rochdale)	Torney, Tom
Radice, Giles	Smith, Rt Hon J. (North Lanarkshire)	Varley, Rt Hon Eric G.
Rees, Rt Hon Merlyn (Leeds South)	Snape, Peter	Walker, Rt Hon Harold (Doncaster)
Rhys Williams, Sir Brandon	Soley, Clive	Watkins, David
Richardson, Jo	Spearing, Nigel	Weetch, Ken
Roberts, Albert (Normanton)	Spriggs, Leslie	Welsh, Michael
Roberts, Allan (Bootle)	Squire, Robin	White, Frank R. (Bury & Radcliffe)
Roberts, Ernest (Hackney Nortn)	Stallard, A. W.	White, James (Glasgow, Pollok)
Roberts, Gwilym (Cannock)	Steel, Rt Hon David	Whitlock, William
Robertson, George	Stewart, Rt Hon Donald (W Isles)	Wigley, Dafydd
Robinson, Geoffrey (Coventry NW)	Stoddart, David	Willey, Rt Hon Frederick
Rooker, J. W.	Stott, Roger	Williams, Rt Hon Alan (Swansea W)
Ross, Ernest (Dundee West)	Strang, Gavin	Williams, Sir Thomas (Warrington)
Ross, Stephen (Isle of Wight)	Straw, Jack	Wilson, Rt Hon Sir Harold (Huyton)
Rowlands,Ted	Summerskill, Hon Dr Shirley	Wilson, William (Coventry SE)
Ryman, John	Taylor, Mrs Ann (Bolton West)	Winnick, David
Sandelson, Neville	Thomas, Dafydd (Merioneth)	Woodall, Alec
Sever, John	Thomas, Jeffrey (Abertillery)	Wright, Sheila
Sheerman, Barry	Thomas, Mike (Newcastle East)	Young, David (Bolton East)
Sheldon, Rt Hon Robert (A'ton-u-L)	Thomas, Dr Roger (Carmarthen)
Shore, Rt Hon Peter (Step and Pop)	Thorne, Stan (Preston South)	TELLERS FOR THE AYES:
Silkin, Rt Hon John (Deptford)	Tilley, John	Mr. Ted Graham and
Silkin, Rt Hon S. C. (Dulwich)	Tinn, James	Mr. James Hamilton.
Silverman, Julius
NOES
Adley, Robert	Costain, A.P.	Heath, Rt Hon Edward
Aitken, Jonathan	Crouch, David	Heddle, John
Alexander, Richard	Dean, Paul (North Somerset)	Henderson, Barry
Amery, Rt Hon Jullan	Dickens, Geoffrey	Heseltine, Rt Hon Michael
Ancram, Michael	Dorrell, Stephen	Higgins, Rt Hon Terence L.
Arnold, Tom	Douglas-Hamilton, Lord James	Hill, James
Aspinwall, Jack	du Cann, Rt Hon Edward	Hogg, Hon Douglas (Grantham)
Atkins, Robert (Preston North)	Dunn, Robert (Dartford)	Hooson, Tom
Atkinson, David (B'mouth, East)	Durant, Tony	Hordern, Peter
Baker, Kenneth (St. Marylebone)	Dykes, Hugh	Howe, Rt Hon Sir Geoffrey
Baker, Nicholas (North Dorset)	Eden, Rt Hon Sir John	Howell, Rt Hon David (Guildford)
Beaumont-Dark, Anthony	Edwards, Rt Hon N. (Pembroke)	Howell, Ralph (North Norfolk)
Bell, Sir Ronald	Eggar, Timothy	Hunt, David (Wirral)
Bendall, Vivian	Elliott, Sir William	Hunt, John (Ravensbourne)
Benyon, Thomas (Abingdon)	Emery, Peter	Hurd, Hon Douglas
Benyon, W. (Buckingham)	Eyre, Reginald	Irving, Charles (Cheltenham)
Best, Keith	Fairbairn, Nicholas	Jenkin, Rt Hon Patrick
Bevan, David Gilroy	Fairgrieve, Russell	Jessel, Toby
Biffen, Rt Hon John	Faith, Mrs Sheila	Johnson Smith, Geoffrey
Biggs-Davison, John	Farr, John	Jopling, Rt Hon Michael
Blackburn, John	Fell, Anthony	Joseph, Rt Hon Sir Keith
Blaker, Peter	Fenner, Mrs Peggy	Kaberry, Sir Donald
Body, Richard	Finsberg, Geoffrey	Kellett-Bowman, Mrs Elaine
Bonsor, Sir Nicholas	Fisher, Sir Nigel	Kimball, Marcus
Boscawen, Hon Robert	Fletcher, Alexander (Edinburgh N)	King, Rt Hon Tom
Bowden, Andrew	Fletcher-Cooke, Charles	Kitson, Sir Timothy
Boyson, Dr Rhodes	Fookes, Miss Janet	Knight, Mrs Jill
Braine, Sir Bernard	Forman, Nigel	Knox, David
Bright, Graham	Fowler, Rt Hon Norman	Lamont, Norman
Brinton, Tim	Fox, Marcus	Lang, Ian
Brittan, Leon	Fraser, Rt Hon H. (Stafford & St)	Langford-Holt, Sir John
Brooke, Hon Peter	Fraser, Peter (South Angus)	Latham, Michael
Brotherton, Michael	Galbraith, Hon T. G. D.	Lawrence, Ivan
Brown, Michael (Brigg & Sc'thorpe)	Gardiner, George (Reigate)	Lawson, Nigel
Browne, John (Winchester)	Gardner, Edward (South Fylde)	Lennox-Boyd, Hon Mark
Bruce-Gardyne, John	Gilmour, Rt Hon Sir Ian	Lester, Jim (Beeston)
Bryan, Sir Paul	Glyn, Dr Alan	Lewis, Kenneth (Rutland)
Buchanan-Smith, Hon Alick	Goodhart, Philip	Lloyd, Ian (Havant & Waterloo)
Buck, Antony	Goodhew, Victor	Lloyd, Peter (Fareham)
Budgen, Nick	Goodlad, Alastair	Luce, Richard
Bulmer, Esmond	Gorst, John	Lyell, Nicholas
Butcher, John	Gow, Ian	McCrindle, Robert
Butler, Hon Adam	Gower, Sir Raymond	Macfarlane, Neil
Cadbury, Jocelyn	Grant, Anthony (Harrow C)	MacGregor, John
Carlisle, John (Luton West)	Gray, Hamish	MacKay, John (Argyll)
Carlisle, Kenneth (Lincoln)	Greenway, Harry	McNair-Wilson, Michael (Newbury)
Carlisle, Rt Hon Mark (Runcorn)	Grieve, Percy	McNair-Wilson, Patrick (New Forest)
Chalker, Mrs Lynda	Griffiths, Eldon (Bury St Edmunds)	McQuarrie, Albert
Channon, Paul	Griffiths, Peter (Portsmouth N)	Madel, David
Chapman, Sydney	Grist, Ian	Major, John
Churchill, W. S.	Grylls, Michael	Marland, Paul
Clark, Hon Alan (Plymouth, Sutton)	Gummer, John Selwyn	Marlow, Tony
Clark, Sir William (Croydon South)	Hamilton, Hon Archie (Eps'm&Ew'll)	Marshall, Michael (Arundel)
Clarke, Kenneth (Rushcliffe)	Hamilton, Michael (Salisbury)	Mates, Michael
Clegg, Sir Walter	Hannam, John	Mather, Carol
Colvin, Michael	Haselhurst, Alan	Maude, Rt Hon Angus
Cope, John	Havers, Rt Hon Sir Michael	Mawby, Ray
Cormack, Patrick	Hawksley, Warren	Mawhinney, Dr Brian
Corrie, John	Hayhoe, Barney	Maxwell-Hyslop, Robin

Mayhew, Patrick	Rathbone, Tim	Tebbit, Norman
Mellor, David	Rees, Peter (Dover and Deal)	Temple-Morris, Peter
Meyer, Sir Anthony	Rees-Davies, W. R.	Thatcher, Rt Hon Mrs Margaret
Miller, Hal (Bromsgrove & Redditch)	Renton, Tim	Thomas, Rt Hon Peter (Hendon S)
Mills, Iain (Meriden)	Rhodes, James, Robert	Thompson, Donald
Mills, Peter (West Devon)	Ridley, Hon Nicholas	Thorne, Neil (Ilford South)
Mitchell, David (Basingstoke)	Rifkind, Malcolm	Thornton, Malcolm
Moate, Roger	Rippon, Rt Hon Geoffrey	Townend, John (Bridlington)
Monro, Hector	Roberts, Michael (Cardiff NW)	Townsend, Cyril D, (Bexleyheath)
Montgomery, Fergus	Roberts, Wyn (Conway)	Trippier, David
Moore, John	Rossi, Hugh	Trotter, Neville
Morris, Michael (Northampton, Sth)	Rost, Peter	van Straubenzee, W. R.
Morrison, Hon Charles (Devizes)	Royle, Sir Anthony	Vaughan, Dr Gerard
Morrison, Hon Peter (City of Chester)	Sainsbury, Hon Timothy	Viggers, Peter
Mudd, David	St. John-Stevas, Rt Hon Norman	Waddington, David
Murphy, Christopher	Scott, Nicholas	Wakeham, John
Myles, David	Shaw, Giles (Pudsey)	Walker, Rt Hon Peter (Worcester)
Neale, Gerrard	Shelton, William (Streatham)	Walker, Bill (Perth & E Perthshire)
Nelson, Anthony	Shepherd, Colin (Hereford)	Walker-Smith, Rt Hon Sir Derek
Neubert, Michael	Shepherd, Richard(Aldridge-Br'hills)	Wall, Patrick
Newton, Tony	Shersby, Michael	Walters, Dennis
Normanton, Tom	Silvester, Fred	Ward, John
Nott, Rt Hon John	Skeet, T. H. H.	Warren, Kenneth
Oppenheim, Rt Hon Mrs Sally	Smith, Dudley (War. and Leam'ton)	Watson, John
Osborn, John	Speed, Keith	Wells, John (Maidstone)
Page, John (Harrow, West)	Speller, Tony	Wells, Bowen (Hert'rd & Stev'nage)
Page, Rt Hon Sir R. Graham	Spence, John	Wheeler, John
Page, Richard (SW Hertfordshire)	Spicer, Jim (West Dorset)	Whitelaw, Rt Hon William
Parris, Matthew	Spicer, Michael (S Worcestershire)	Whitney, Raymond
Patten, Christopher (Bath)	Sproat, Iain	Wickenden, Keith
Patten, John (Oxford)	Stainton, Keith	Wiggin, Jerry
Pawsey, James	Stanbrook, Ivor	Wilkinson, John
Percival, Sir Ian	Stanley, John	Williams, Delwyn (Montgomery)
Pink, R. Bonner	Steen, Anthony	Winterton, Nicholas
Pollock, Alexander	Stevens, Martin	Wolfson, Mark
Prentice, Rt Hon Reg	Stewart, Ian (Hitchin)	Young, Sir George (Acton)
Price, David (Eastleigh)	Stewart, John (East Renfrewshire)	Younger, Rt Hon George
Prior, Rt Hon James	Stokes, John
Proctor, K. Harvey	Stradling Thomas, J.	TELLERS FOR THE NOES:
Pym, Rt Hon Francis	Tapsell, Peter	Mr. Spencer le Marchant and
Ralson, Timothy	Taylor, Robert (Croydon NW)	Mr. Anthony Berry

Question accordingly negatived.