Commons Sitting of 9 February 1981

Preamble
The House met at half-past Two o'clock
PRAYERS
[MR. SPEAKER in the Chair]
Oral Answers to Questions
  Industry

    Index of Industrial Production
    Mr. Knoxasked the Secretary of State for Industry what is the index of industrial production at present; and how this compares with the comparable figure for the same months in 1974.
    The Minister for Industry and Information Technology (Mr. Kenneth Baker): In the three months to November 1980 the index of industrial production was 100·6, some 3½ per cent, lower than in the same period in 1974.
    Mr. Knox: Does my hon. Friend agree that those figures tell the story of six wasted years? What steps do the Government intend to take to increase demand for industry's products so that we can once again achieve the increased industrial production that we had in the 30 years after the war?
    Mr. Baker: I share my hon. Friend's concern. As the House knows, the major reason for the drop in manufacturing and industrial production last year was the reduction of stocks, which was on a scale unprecedented in our recent economic history. There is an indication that that trend is coming to an end.
    Mr. Anderson: Do these appalling figures suggest to the Minister that the Government are on target? If so, which target are they aiming at?
    Mr. Baker: If the hon. Gentleman is calling for some change of direction or variation in target, I should remind him that the Government's overriding target is to contain the rate of inflation. If we are deflected from that target we shall never get out of the cycle of inflation and unemployment.

    Motoring Manufacturing
    Mr. Iain Millsasked the Secretary of State for Industry if he will make a statement on the future of the motor manufacturing industry in the United Kingdom.
    The Minister of State, Department of Industry (Mr. Norman Tebbit): The future of the motor manufacturing industry depends upon its ability to offer competitive products to the satisfaction of the consumer. There are encouraging signs that progress is being made in this respect.
    Mr. Mills: I thank my hon. Friend for that reply. Is he aware that my constituents in the West Midlands, particularly those who work at Longbridge, are most satisfied with the Government's past and recently announced policy, which has allowed the development of the Metro car? Hon. Members on both sides of the House can hardly avoid recognising that it is a stunning success. Will my hon. Friend confirm that this is the way that British-built cars with British-built components can eat into the market share of imported foreign-built cars?
    Mr. Tebbit: I agree that the success of the Metro—both in terms of market penetration and of the productivity of those employed at the plant—is most encouraging. I wish the company well. I hope that its next models will be as successful.
    Mr. Park: Are the Government prepared to support the approaches that have been made by the car constructors' association in Europe to do something on an EEC basis against the penetration of Japanese products?
    Mr. Tebbit: The most constructive thing that the British Government have done is to give a general welcome to Nissan so that it can build cars in Britain with British labour to the benefit of the British economy.
    Mr. Stokes: Is my hon. Friend aware that we sympathise with him over the difficult decisions that he has to make about Government aid to the motor car industry? If we can afford to support British Leyland, can we afford to support Talbot as well, given that Peugeot has the main responsibility?
    Mr. Tebbit: It is not a matter of supporting any of these companies other than in the respect that we are—I trust—seeing British Leyland through to a condition in which it can return to the private sector. The Talbot company is not in the British public sector and the two cases are different.
    Mr. Gordon Wilson: Does not the Minister realise that the State has given massive financial aid to the car industry in England? In those circumstences, what steps will the Government take to retain motor car manufacturing at Linwood, given that thousands of jobs are at stake in Scotland, in an area of high unemployment?
    Mr. Tebbit: On a previous occasion I said that companies are influenced as to where to invest in the United Kingdom not only by Government policies towards development grants and things of that nature, but by the past record of success, or otherwise, of investments in particular areas.

    Advance Factories (West Yorkshire)
    Mr. Sheermanasked the Secretary of State for Industry why the English Industrial Estates Corporation's advance factory building programme for West Yorkshire is withdrawing funds from areas losing assisted area status approximately 18 months before the Government's decision is due to take effect.
    The Under-Secretary of State for Industry (Mr. John MacGregor): To conform with the Government's policy of concentrating regional assistance in the areas where it is most needed.
    Mr. Sheerman: Is the Minister aware that his right hon. Friend the Secretary of State for Industry not only

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    promised delegations from West Yorkshire that West Yorkshire's intermediate status would be reviewed but assured them that the application of this Act would not take place until July 1982? Is not this activity by the English Industrial Estates Corporation reneging on a promise by the Minister?
    Mr. MacGregor: I know that my right hon. Friend is to meet a deputation shortly. I ought to make it clear that we are spending more Government money and that there is a lot of private money coming in, so that the English Industrial Estates Corporation now has the largest programme of industrial investment that it has ever carried through. Nevertheless, there is still not enough money to build factories in every part of the assisted areas. In the past, many places in assisted areas have not received advance factories from the corporation. In the coming programme, only 34 of the 60 assisted areas which will keep that status after 1982 are being included.

    British Steel (Corporate Plan)
    Mr. Campbell-Savoursasked the Secretary of State for Industry what consultations there have been with the British Steel Corporation on the British Steel Corporation corporate plan.
    The Secretary of State for Industry (Sir Keith Joseph): There have been frequent consultations between the Department and the BSC about the corporate plan, and I have had two discussions with the chairman.
    Mr. Campbell-Savours: When does the Secretary of State intend to approve the corporate plan? Prior to that approval, will he examine the document which I delivered to his Department last Friday and to the office of the Under-Secretary of State entitled "The Ingot Mould Foundry Rationalisation Review" of 4 February this year which challenges the commercial assumptions of the corporation which have led to the recommendation that the Distington foundry be closed? In the light of the publication of that document, will the right hon. Gentleman put it to the British Steel Corporation that it should re-evaluate Distington and suspend its decision pending that re-evaluation?
    Sir Keith Joseph: On the first part of the question, I hope to make a statement giving the response to the BSCs plan in the next few days. On the second part of the question, I understand that a document arrived this morning. From the little that I so far know of it, I judge that it is a matter for the management of BSC. I am sure that it will be studied by the BSC management.
    Mr. Michael Brown: When my right hon. Friend makes his announcement later in the week, will he give the Government's view on the viability of the corporate plan? Is he aware that, though I represent a steel constituency, I do not believe that the security of the steel industry is necessarily dependent on the amount of money that the Government can put into the industry? Finally, what assurances has my right hon. Friend sought from the British Steel Corporation to the effect that its corporate plan will be commercially viable?
    Sir Keith Joseph: The management and work force of BSC have to cope with the market as it evolves. We all hope that they will do their very best, but the market may continue to be hostile. No one can guarantee the outcome
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    for any part of BSC or for BSC as a whole. It is up to the management and work force to do their very best in the current economic circumstances.
    Mr. Hardy: As industrial recovery will have to occur some time, whether the present Administration desire it or not, are we not justified in questioning the adequacy of the envisaged capacity for steel production in the United Kingdom, especially in regard to special steels and, therefore, South Yorkshire, where world records have frequently been broken in the past and where they were again broken, in my constituency, a few days ago?
    Sir Keith Joseph: The hon. Gentleman puts his finger on one of the many difficult judgments that the management has to make. The Government also have to consider the cost to the taxpayer of keeping spare capacity. The house will know that the management proposes to keep some spare capacity unmanned for a future upturn.
    Mr. Grylls: When my right hon. Friend considers the corporate plan, will he bear in mind that it is important that the private sector steel companies are not damaged by subsidised competition, particularly in common areas such as bars and steel billets and engineering steel?
    Sir Keith Joseph: My hon. Friend has also identified a crucially important subject about which the Government are deeply concerned. The Government have blessed the efforts by BSC and some parts of the private sector to see whether viable joint commercial partnerships can be evolved.
    Dr. John Cunningham: I should think that the private steel manufacturers must be quaking if they have been blessed by the Secretary of State, given his effect on other industries in our economy. Will the Secretary of State assure the House that, when he makes his statement about the MacGregor corporate plan, he will make clear exactly to what discussions between the British Steel Corporation and the private sector he has given his blessing, since clearly the Opposition also recognise the importance of many of the private sector steel makers?
    Sir Keith Joseph: There is no mystery here. The details are commercial and are for the companies concerned and for BSC. But, as my hon. Friend the Member for Surrey, North-West (Mr. Grylls) identified in his supplementary questions, those concerns in the private sector whose trade overlaps with that of BSC have been and are in discussion with BSC about possible partnerships.

    Northern Development Agency
    Dormandasked the Secretary of State for Industry if he will now establish a Northern Development Agency.
    Sir Keith Joseph: I am not persuaded that the best interests of the North would be served by the creation of such an agency.
    Mr. Dormand: That is an extremely disappointing answer. Does the right hon. Gentleman recall that it is nine months since my hon. Friends and I met him to discuss this matter? Does he realise how much the position in the Northern region has deteriorated since that time and that the need for an agency is greater than ever? Bearing in

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    mind the desperate need to have the Datsun car factory placed in the Northern region and the help that a development agency could give towards it, would it not be more appropriate for the right hon. Gentleman to lead the delegation that is to go to Japan later this month?
    Sir Keith Joseph: It was because of the respect that I have for the sincerity of the case put forward by the hon. Gentleman and many hon. Friends of his and of mine about the North that my colleagues and I took so long to come to a final decision about the idea of a development agency. I know about the deterioration of the position in the North, but it still remains true that future prospects for the North depend on the enterprise of the business community both in the North and in the country as a whole and the co-operation of the work force within the framework that the Government provide.
    Mr. Cowans: Is the Secretary of State aware of the imbalance created by the Scottish Development Agency and the Welsh Development Agency whem trying to attract jobs to the North? Will he correct that imbalance by setting up a development agency, bearing in mind the high unemployment there, and in doing so get away from the myth that the Government have turned their back on the North?
    Sir Keith Joseph: The hon. Gentleman expresses a fairly widely held view, but all the powers held by the Scottish and Welsh Development Agencies respectively are held, though by different agencies, in the North. To add an agency on the lines of the Scottish or Welsh Development Agency for the North would not provide a single extra power but would provide an extra unit of bureaucracy which would confuse rather than increase the prospects for the North.
    Mr. Lennox-Boyd: In his deliberations about the creation of a Northern development agency, will my right hon. Friend consider the point that if he acceded to such a request it would lead to a call for a North-Western development agency, since that area would suffer the same problems in relation to Scotland as a result of the creation of a Northern Development Agency?
    Sir Keith Joseph: I do not want to put ideas into the minds of other hon. Members. I do not think that the North-West would be the only other part of the country concerned.
    Mr. Orme: If the Secretary of State has rejected the concept of a development agency for the Northern region, what steps will he take to improve a deteriorating situation?
    Sir Keith Joseph: The right hon. Gentleman is yet again supporting the myth that prosperity comes from Government. That is not true. The Government can create as encouraging a framework as is practicable, and that is what we are in the process of doing. Prosperity comes from enterprise and co-operation.

    Small Businesses
    Mr. Garel-Jonesasked the Secretary of State for Industry if he is satisfied that sufficient accommodation is available for new small businesses.
    Mr. MacGregor: As a result of actions taken by the Government, I am pleased to say that the availability of premises for new small businesses is improving to meet the continuing high level of demand.
    Mr. Garel-Jones: I am grateful to my hon. Friend. Will he expand on a reply that he gave earlier to the hon. Member for Huddersfield, East (Mr. Sheerman) and tell the House more about the role being played by the English Industrial Estates Corporation? Will he tell the House what impact, if any, the changes in the Finance Act 1980 to the industrial buildings allowance have made to the availability of small units?
    Mr. MacGregor: The Coopers and Lybrand study, which my Department commissioned, found that dominance of the public sector in this part of the market had led to little provision in recent years and had made it unattractive to private investors. The corporation has now involved the private sector. In addition to the extra £5 million that the Government have made available for small firm units, agreements to a total value of £30 million, including the £5 million, have been concluded with the private sector. These will provide upwards of 1,500 small units in the assisted areas.
    The Coopers and Lybrand report and the increase in the industrial building allowance for small units from 50 per cent. to 100 per cent. has led, according to a recent survey, to a greater number of smaller industrial units being built by the private sector than has been the position for many years. Small units can make a valuable contribution to local economies and it is encouraging to see this progress.
    Mr. John Garrett: Does the hon. Gentleman agree that his reply was a load of eyewash? Whether accommodation is available or whether it is not, the fact is that small businesses are going bankrupt at a record rate due to high interest rates and lack of demand, which is the fault of the Government of whom he is a member.
    Mr. MacGregor: The large building programme for small units is being filled by many demands from small firms and there are many small firms being created at the same time as others are in difficulties. One of the principal reasons for high interest rates is the high level of Government spending that the hon. Gentleman wants to see further increased. That would further increase interest rates and thus more adversely effect small firms rather than reverse the trend.
    Mr. Dover: Will my hon. Friend ensure that my right hon. and learned Friend the Chancellor of the Exchequer is aware of the success of the taxation allowances and press him to give further allowances on larger buildings in the forthcoming Budget?
    Mr. MacGregor: I am sure that my right hon. and learned Friend has noted the success of the scheme for small firms. Obviously I cannot pre-empt what my right hon. and learned Friend might wish to do in his Budget.
    Mr. Robert C. Brown: Is the hon. Gentleman aware that there was a time when we used to seek the active intervention of the English Industrial Estates Corporation to build advance factories? Is he further aware that in the Northern region we have more than sufficient industrial space lying empty, as a result of the Government's policies, to take up all the unemployment in the region?
    Mr. MacGregor: Our experience with small units and experimental workshops has been extremely encouraging.

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    As the world recession lifts and as the economy picks up it will be possible for many more estates to take advantage of the facilities that are being provided.

    Computer Industry
    Mr. Dykesasked the Secretary of State for Industry if he plans any measures in the medium and long term aimed at assisting the strength and viability of the United Kingdom computer industry.
    Mr. Kenneth Baker: The United Kingdom computer industry must develop and market internationally competitive products if it is to remain strong and viable. The Govenment currently operate a number of measures aimed at encouraging the development of such products which will continue to make a substantial contribution to the medium and long-term future of the industry.
    Mr. Dykes: May I thank my hon. Friend for that answer? Bearing in mind that the survival of the British computer industry is literally at stake in international terms and that the Government are bound to be involved in providing some form of public funds for high technology products and new electronics, will the Government now consider providing more as a proportion of the total research and development expenditure for British computer companies and more in comparison with their ferocious competitors in other countries?
    Mr. Baker: My hon. Friend makes a good point. However, I must emphasise the amount of support that is already available under three schemes that my Department operates. First, there is the MAP scheme—namely, the microelectronics applications programme, which involves £55 million over four years. Secondly, there is the microelectronics industry support scheme and, thirdly, the product and process development scheme, which involves many projects that are directed to microelectronics. My Deprtment provides research and development facilities and money for those projects. I am conscious of the value of that support.
    Mr. Eastham: Will the hon. Gentleman bear in mind that only a few months ago the Minister of State was gloating about the privatisation of ICL? I do not know whether he has read the financial reports, but ICL is now running into a deficit of possibly £50 million. What is he prepared to do about this? Is he prepared to emulate the previous Labour Government and save the British computer industry and thousands of jobs or is he merely prepared idly to stand by?
    Mr. Baker: It is clear that ICL is experiencing the same problems as many companies in the recession. Orders are short and costs are high. The chairman said at the annual general meeting last week that the company is implementing a series of measures to conserve its cash flow, such as plant closure, no general wage increase and the disposal of surplus premises. These measures are prudent and necessary and will strengthen the company.
    Mr. Henderson: May we take it from my hon. Friend's reply that he at least is not making the mistake of confusing the totality of the British computer industry with the individual interests of one company?
    Mr. Baker: No, Sir. The British computer industry is composed of many companies that operate in hardware,
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    software, the mainframe area, mini-computers and microcomputers. There is a great deal of vitality and strength in the industry.
    Mr. John Garrett: Will the Minister make it clear that he intends to guarantee the future of ICL?
    Mr. Baker: My Department has not received any specific and formal request for assistance from ICL. I understand that the company is having talks with its bankers. I saw from the chairman's statement last week that the company is putting in hand measures to strengthen its cash position. My Department is in frequent contact with ICL over its future research and development programme, as with all other major information technology companies. The public sector is a major user of ICL equipment.

    West Midlands
    Mr. Winnickasked the Secretary of State for Industry when he now expects to see progress in industrial revival within the West Midlands.
    The Under-Secretary of State for Industry (Mr. Michael Marshall): The industrial revival of the West Midlands depends on reducing inflation, on the drive and enterprise of management, and on the understanding and co-operation of work forces.
    Mr. Winnick: Will the Minister get away from those platitudes? When will he realise that so much of industry in the West Midlands and in the Black Country districts is being devastated as a result of Government policies? There are redundancies and closures daily and extensive short-time working. If the Government's policies have proved unsuccessful, why not change them? Why not change the dogma and allow our industry to prosper?
    Mr. Marshall: The hon. Gentleman ignores a number of factors that he should take into account in the interests of achieving a balance. The reduction of IDCs and the 100 per cent, grants for approved clearance schemes are only two of many measures that have had an effect on the West Midlands. There is also the enterprise zone at Dudley, which is not very far away from the hon. Gentleman's constituency. The hon. Gentleman talks about platitudes, but he must realise that the prime target is the defeat of inflation, which will affect the West Midlands as well as everywhere else.
    Mr. Budgen: Does my hon. Friend agree that the new but important problem in both the steel and the motor industries, which are important to the West Midlands, is that the Government must either reduce taxpayers' subsidies to these industries or give yet further and larger subsidies to the private sectors of the industries, so that they may compete against the State sector, which is in receipt of vast subsidies?
    Mr. Marshall: The question that my hon. Friend poses is in a sense a false one. Much depends on the prospects of the companies that feature in his question. However, he is right to stress, if we are talking about help to the West Midlands, that it was because of the wider implications for the West Midlands and the entire components industry that the BL decision was taken.
    Mr. Geoffrey Robinson: While Labour Members welcome the decision on BL, will the Minister confirm

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    that later today his right hon. Friend is due to meet a delegation from Peugeot at the highest level which may have a direct bearing on the situation in the West Midlands for Talbot? Can we have an undertaking from the Minister that he will tackle the approach from Peugeot with a view to using the same strength of Government purchasing power and aid as we did with Datsun to encourage Peugeot to maintain an investment here?
    Mr. Marshall: The hon. Member is somewhat adrift. That is a different question but the decisions that stem from the conversations with Peugeot are for the company to make.
    Mr. Beaumont-Dark: In the new deal with the Nissan company, will the Minister not overlook the great pool of highly trained and skilled labour in the motor industry in the West Midlands which could produce a real success for another car manufacturer, which would also bring work to the hard pressed components industry which, similarly has a large pool of highly skilled labour?
    Mr. Marshall: I am sure that the Nissan company will take careful note of my hon. Friend's remarks. He has reinforced some of the positive aspects of this successful inward investment.

    Information Technology
    Mr. Hendersonasked the Secretary of State for Industry when the Government intend to publish their response to the ACARD report on information technology.
    Mr. Kenneth Baker: I shall be co-ordinating the Government's response to the ACARD's excellent report on informantion technology and that will be published soon.
    Mr. Henderson: In addition to the co-ordination that my hon. Friend will be arranging within his Department, will there be further co-ordination with other Departments? Is not my hon. Friend disappointed that, in a period of general recession, opportunities for profitable investment in information technology have sometimes been neglected? In particular, will he look at opportunites for carrying out legal reforms which would prevent any holding back of the development of the industry?
    Mr. Baker: On the last point, I am keen to remove any obstacles that will hinder the growth of the industry. They tend to be in the area of national and international regulations and so on. On the point concerning general investment, I am not aware of general withholding of investment in these industries. There is a good flow of investment going into the industries, which are a growth sector. On the first point, concerning co-ordination between Government Departments, my hon. Friend is right. The policies affecting the range of these industries, which range from satellites through to computer games, mean that several departments are involved.
    Mr. Forman: I recognise my hon. Friend's positive response to the excellent report. Will he undertake that the Government's public sector procurement policy will be to the fore in responding to the report? Will the Government do everything possible to initiate demonstration projects in the public sector?
    Mr. Baker: Public procurement is an important and powerful weapon which can be used constructively in this
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    area. I am arranging for cetain trial operations within my Department using Prestel/Viewdata, in which this country has a world lead. We must ensure that we do not lose it.

    British Leyland
    Mr. Adleyasked the Secretary of State for Industry if he will make a statement on progress in breaking up the corporate structure of BL; and what further discussions he has had with the chairman of BL.
    Sir Keith Joseph: I told the House on 26 January that the intention of the BL board is to draw the operating units into four distinct businesses—BL Cars, Land-Rover, Unipart and the Leyland Group. The new organisation of the Leyland group was announced on 19 January. I have had no discussions with Sir Michael Edwardes since my announcement of funding for BL on 26 January.
    Mr. Adley: Is my right hon. Friend aware that all pragmatic Conservatives will doubtless welcome the remarks of the Prime Minister in her speech last week that the Government will not hesitate to intervene from time to time in industry if they consider it to be necessary? In view of the enthusiasm with which my right hon. Friend has sought to intervene in British Aerospace and British Airways, to assist in what one might call privatisation, will my right hon. Friend show the same enthusiasm and undertake the same activities with some of the component parts of BL?
    Sir Keith Joseph: We shall continue to leave judgments about the degree and timing of any sale of parts of BL to the management of BL.
    Mr. Orme: Will the Secretary of State repudiate the damaging letter in The Times on Saturday from some of his hon. Friends about the selling of certain assets of British Leyland? Is he aware that that has already had a damaging effect on management morale in BL? Is it not time that the company was allowed to get on with the job and produce the cars and employment that is so essential?
    Sir Keith Joseph: My hon. Friends are animated by the same desire as everyone else for the prospects of BL and all its parts. I hope that in their enthusiasm they will recognise that having appointed a management, the Government must leave it to the management to make the decisions.
    Mr. Hal Miller: Will my right hon. Friend accept that the sale of currently profitable parts of BL would bring in train the possibility of a need for a greater subsidy for the other parts?
    Sir Keith Joseph: Without going into those probabilities, I must repeat that the decisions are for management.
    Mr. Gwilym Roberts: In view of the impact of the Datsun project on BL, and the West Midlands area in particular, will the Secretary of State look seriously at the point made by his hon. Friend the Member for Birmingham, Selly Oak (Mr. Beaumont-Dark) about the possibility—in view of the component base and the obvious advantages to the motor industry—of introducing a project of this sort to the West Midlands area?
    Sir Keith Joseph: I must repeat that the decision on such matters is for Nissan. The company has undertaken a feasibility study. Its final decision is yet to be made.

    Finniston Report
    Mr. Wallerasked the Secretary of State for Industry when the Government will announce further decisions on the implementation of the Finniston report.
    Mr. Douglasasked the Secretary of State for Industry if he will make a statement on discussions he has had with engineering institutions regarding a Royal Charter for the proposed Engineering Council.
    Mr. Michael Marshall: As explained by my hon. Friend in Committee on the Industry Bill on 15 January, we are at present discussing with those concerned the draft Royal Charter which has been placed in the Library. We hope to make rapid progress on the broad basis set out in the charter.
    Mr. Waller: Does my hon. Friend agree that a vital objective indentified by Finniston was the need to attract more well-qualified young people into the engineering industry? What discussions are taking place between his Department and the Department of Education and Science, particularly since the conference held to discuss that subject in the autumn, with a view to attracting more young people of the right calibre to undertake engineering education?
    Mr. Marshall: My hon. Friend is right to draw attention to that important aspect of Finniston. My Department and the Department of Education and Science are in touch on these matters. We are awaiting the report of the conference and I expect that further consideration must depend on what comes from that report.
    Mr. Edwin Wainwright: Does the Minister realise that it is reported throughout Europe that the United Kingdom educates the smallest number of young people between 16 and 19 years of age? Does he not agree that unless those young people have a good basic education they cannot take advantage of any training programme that the Government might inaugurate? Will he look at that problem to see what the Government can do to help those young people?
    Mr. Marshall: I understand and appreciate the problems. One of the prime tasks for the new engineering body when it is created must be to look at those problems. However, the Government also have a role to play and I shall take an interest in the questions the hon. Gentleman posed.
    Mr. Dover: Will the Minister confirm that the presidents of all the major engineering institutions reject the charter? Is he aware that the presidents are afraid that the engineering profession will become nationalised? Will he do everything possible to seek their co-operation in any future measures?
    Mr. Marshall: Yes, but my hon Friend will appreciate that when my right hon. Friend made his statement on 7 August there was a general welcome for that statement by the institutions. We have reached a substantial measure of agreement about the voluntary form that is proposed. That is the view of the vast majority of people with whom we have consulted, despite what my hon. Friend implies. We are discussing the fine print of the charter at this stage. It is not unusual to have some difficulty in reaching final agreement on the form of words. I hope and believe that it will be possible to reach agreement.

    British Steel
    Mr. Chapmanasked the Secretary of State for Industry if he will make a statement on his response to the plan for the future of the British Steel Corporation submitted to him by Mr. Ian MacGregor.
    Sir Keith Joseph: I expect to make a statement on the BSC corporate plan within the next few days.
    Mr. Chapman: As a curtain raiser to that statement will my right hon. Friend confirm that in the past 10 years public subsidy to the British Steel Corporation has totalled no less than £5,000 million? In the light of that, will he say that it is not unreasonable for the hard-pressed taxpayer now to demand that any future subsidy should be seen patently to go in to sound capital investment rather than covering what appear to be ever-increasing operational losses?
    Sir Keith Joseph: My hon. Friend is right to draw attention to the magnitude of the amounts that have been poured into the industry by the taxpayer. However, in the transition to a viable industry there are unavoidable costs, including closure and redundancy costs.
    Mr. Denzil Davies: If the Government announce on Wednesday, as they probably will, further financial help to BSC—and my right hon. and hon. Friends and I approve of that—will the right hon. Gentleman also give the same financial help to other steelworks, such as Duport Steel in my constituency, to enable them to survive and provide more employment?
    Sir Keith Joseph: I certainly share the right hon. Gentleman's concern about subsidised competition with the private sector. We shall do our best to protect the private sector from that. The Government certainly want to reduce assistance to the BSC rather than provide assistance for the private sector.
    Mr. Kenneth Lewis: Does my right hon. Friend accept that when he makes his announcement he will have to give the BSC a large sum which will be much more than he wanted to give and much more than he said that he would have to give? Will he make sure that the money is not used—and there should be monitoring to ensure that this does not happen—to subsidise BSC's activities against the private sector?
    Sir Keith Joseph: That is precisely the point which the right hon. Member for Llanelli (Mr. Davies) emphasised and with which, in principle, I entirely agree. Where the private and public sectors overlap we are encouraging the evolution of joint partnerships.
    Mr. James Hamilton: Is the right hon. Gentleman aware that although he has not yet acquiesced to the corporate plan, job losses are already taking place in Scotland, including some in my constituency, and the engineering section under the auspices of the BSC is closing in June? As the right hon. Gentleman has not yet acquiesced to the plan, why are closures taking place?
    Sir Keith Joseph: Under the legislation enacted by a Labour Government, who set up the BSC, the corporation needs no authority from me to close works or to dismiss staff.

    Consett
    Mr. David Watkinsasked the Secretary of State for Industry what measures he is now taking to stimulate industrial redevelopment in the Consett area.
    Mr. MacGregor: Consett has been made a special development area. The Government have instituted a special programme of remedial measures involving factory building, derelict land clearance grants, special manpower measures, support for local road improvements and compensation to the local authorities for the loss of rate income.
    Mr. Watkins: Bearing in mind the Secretary of State's misconceived answer to an earlier question about the establishment of a Northern development agency, will the hon. Gentleman consider acting positively on the suggestion that I made during his recent visit to Consett to the affect that he should come to the area twice a year to chair meetings of the locally based strategy committee, which is doing so much to further industrial redevelopment in the area but which cannot do more without outside help, because of the sheer magnitude of the problem?
    Mr. MacGregor: I accept the magnitude of the problem and I was impressed by the constructive approach that the hon. Gentleman, local authorities and the community are taking to deal with the switch from decling industries to the new jobs of thefuture. I hope that it is clear that the Government have introduced a wide range of measures to try to help. As the hon. Gentleman knows, 58 factory units will be available shortly. As for my taking the chair at meetings of the strategy committee, the hon. Gentlena will appreciate that I have many responsibilities in other parts of the country and I cannot give an absolute commitment to come to his area twice a year. However, I shall do all that I can to keep a close interest in what is happening there.
    Sir William Elliott: Is my hon. Friend aware that his recent visit to the region was most welcome? Is he further aware that there is a general appreciation in the North-East that the Government have introduced a wide measure of assistance to the region and that they are conscious of our problems? Does he agree that there is great encouragement in the interest being shown by smaller developers in factories of 1,000 sq. ft. and less on our trading estates? Will he do all that he can to encourage smaller developers?
    Mr. MacGregor: I am grateful for my hon. Friend's remarks. He will know that it was because of my interest in the problems of the Northern area that I made it one of the first places that I visited after my appointment. I entirely agree with what my hon. Friend said about small developers. I am sure that they will make a useful and significant contribution.
    Dr. John Cunningham: Does not the Minister's problem in dealing with the debacle at Consett and throughout the Northern region arise from the fact that there is a collapse in investment in British manufacturing industry? Is that not exemplified by the recent statement of the managing director of one of the largest chemical industries in this country that, because of the overvaluation of sterling and our high interest rates, his company will be concentrating its investment outside the United Kingdom?
    Mr. MacGregor: The problem of investment has existed in this country for years and has been coupled with the insufficiently effective use of the investment that we have had. The hon. Gentleman will know that among the major factors that affect business confidence are the rate of inflation and expectations about inflation. The fact that inflation is coming down is helpful.

    British Telecom
    Mr. Marlowasked the Secretary of State for Industry when he next expects to meet the chairman of British Telecom to discuss investment in telecommunications.
    Mr. Kenneth Baker: My right hon. Friend and I discuss telecommunications investment with the chairman of British Telecom as the need arises.
    Mr. Marlow: It may be a small point, but is my hon. Friend aware that British Telecom is investing a certain amount of money in yellow paint at the moment, with a view to painting telephone kiosks yellow? The reason given is that it is thinking of changing its livery. I wonder whether my hon. Friend could tell the chairman of British Telecom that the colour of telephone kiosks is part of our national heritage and is not only a matter concerning the livery of British Telecom.
    Mr. Baker: Livery matters are not for me. They are clearly for the Post Office and British Telecom. It must be for them to decide what colour they wish to paint their kiosks and vans.
    Mr. Peter Bottomley: Is it sensible to require British Telecom to finance its investment out of profits or would it be sufficient for it to do what any private business would do, namely to finance the cost of investment out of profits?
    Mr. Baker: My hon. Friend has raised an important point, which the Government are considering. Last week, I accepted an amendment to the British Telecommunications Bill moved by my hon. Friend the Member for Fife, East (Mr. Henderson) to allow British Telecom to borrow from sources other than the Government. However, I stress that that is a permissive power and it does not mean that we have yet agreed that British Telecom will do that, since there are much wider implications in allowing nationalised industries to borrow generally from the private sector.

    High Technology
    Mr. Gwilym Robertsasked the Secretary of State for Industry if he will carry out a study of the impact of public expenditure cuts on the efficiency and production capability of high technology firms; what plans he has to stimulate further investment in high technology; and if he will make a statement.
    Mr. Kenneth Baker: The Government will continue to pursue their policy of support for technology through financial assistance under schemes such as product process development scheme, the microelectronics support programme and the microprocessor-applications project programme and by positive public purchasing. However successful, high technology enterprise cannot be created simply by doling out the taxpayers' money.
    Mr. Roberts: I am sure that, with his usual honesty, the Minister will admit that the greatest indictment of the Government's industrial policies is that productivity is falling rapidly. Does he accept that many high technology firms depend on public sector contracts and that many of those firms have been seriously damaged by the Government's public expenditure cuts?
    Mr. Baker: I thank the hon. Gentleman for the comments in the first part of his question. I am sure that he meant them to be a general commendation and not a specific one. I agree, generally, with what the hon. Gentleman said about productivity, but productivity in high technology industries is not falling. If the hon. Gentleman has in mind specific high technology projects where investment funds are not forthcoming, will he please let me know?
    Mr. Kenneth Carlisle: Is my hon. Friend convinced that planned savings in Government expenditure as a result of the proposed reform in the payment of sickness benefits will not put further pressure on the finances of high technology businesses and business generally?
    Mr. Baker: My hon. Friend is ingenious, but that is a wider question.
    Mr. Orme: Returning to the question of ICL, what will the Minister do to save that British company, which is so important at present?
    Mr. Baker: As I said earlier, I deprecate the use of such language. There has been no specific and formal request from the company for assistance, but we are in touch on the future of its research and development programme. I wish that hon. Members, particularly Labour Members, would remember the considerable strengths of ICL. It has 35 per cent, of the United Kingdom market, its export sales last year were £300 million and it has an installed overseas base of £2 million.

    Regional Assistance Grants
    Mr. William Hamiltonasked the Secretary of State for Industry if he will take steps to expedite the payment of regional assistance grants to industry.
    Mr. MacGregor: Applications for regional development grants are now being approved markedly quicker than last year. Payment of approved applications remains subject to the four months' deferment announced by my right hon. and learned Friend the Chancellor of the Exchequer on 12 June 1979.
    Mr. Hamilton: Will the Minister say what protests he is getting from industry? Is he aware that the paper industry in my constituency has complained to me specifically about slowness in the payment of grants, to the embarrassment and disadvantage of those firms?
    Mr. MacGregor: I am aware of some complaints which I have received since my appointment. I point out, however, that there has been considerable progress. Last year, the average time was about 22 weeks. It is now between three and four months. I shall continue to take a personal interest in this question.

    Prestel/Viewdata
    Mr. Richard Shepherdasked the Secretary of State for Industry what proposals he has to increase the use of Prestel/Viewdata services in the public sector.
    Mr. Kenneth Baker: In Prestel/Viewdata we have a world lead, and I wish to ensure that effective uses are found for this in the public sector as soon as possible. I have put in hand in the Department a pilot scheme linking London and the regional offices which should go live this summer. Other trial projects are in hand, and I have an operational set in my own office.
    Mr. Shepherd: I am grateful to my hon. Friend for that answer. What steps are the Government taking to encourage exports of these systems?
    Mr. Baker: As I have said, this is a skill in which Britain literally has a world lead. We have a better system than the French or Canadians, and the Americans do not have one. I am considering various proposals for exploiting this advantage overseas. So often in the past British technology has not been exploited and marketed in the way that it should have been.

    Medical Privilege
    Mr. Greville Jannerasked the Attorney-General what representations he has received about the rights of doctors to refuse to reveal to courts matters related to them in confidence by patients.
    The Attorney-General (Sir Michael Havers): None, Sir.
    Mr. Janner: Is the right hon. and learned Gentleman aware of the recent case in which a psychiatric nurse was required to reveal in court information of a highly confidential nature given to her by a patient? Has not the time come when doctors, nurses and, indeed, priests should be given the came protection regarding confidential informantion given to them as at present lies within the realm of privilege in respect of informantion given by clients to lawyers?
    The Attorney-General: The hon. and learned Gentleman will realise that one always has to strike a balance between the interests of maintaining a confidential relationship and the interests of justice. This matter was considered in 1977 by the Law Reform Committee, which concluded that no requirement was necessary for it. It is within the terms of reference of the Law Commission's forthcoming report on the law of confidentiality. It may be that something will be set out in the report.
    Mr. Archer: Is not this one more example of the question how far the public interest requires that information disclosed in confidence for one purpose should not be used for a different purpose? Would not Mr. Attorney agree that this is the question that arose in the Harriet Harman case? Is it not a little unfair that questions of the balance of public interest should be left to the courts when they are essentially political questions? Will he suggest at some stage to his noble Friend the Lord Chancellor that either a Royal Commission or some other form of inquiry should consider the whole question?
    The Attorney-General: The question refers to confidentiality so far as doctors are concerned. That is what I was answering.
    Mr. Pavitt: Will the Attorney-General examine the new possibilities that have emerged for general practitioners to use more software and computerised information? Will he make sure that there is no way in

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    which confidentiality is broken, taking into account, for example, the needs of people on supplementary benefit, those receiving allowances and similar benefit? Does he agree that such breaches would be a great disadvantage to the patient of the general practitioner?
    Mr. Attorney-General: As this practice develops, the more it will be necessary to keep an eye on the consequences of it.

    Armed Forces (Criminal Proceedings)
    Mr. Canavanasked the Attorney-General what criteria are used when deciding whether to institute criminal proceedings against members of the Armed Forces for alleged offences arising out of the performance of their duties when assisting the civil authorities.
    The Attorney-General: The Director uses the same basic criteria in all cases whether they involve members of the Armed Forces or not.
    Mr. Canavan: Although the Armed Forces have an unenviable task when dealing with terrorists, does the Attorney-General agree that it would be a deplorable legal precedent in this country for members of the Armed Forces to be given immunity from prosecution for carrying out summary execution of terrorists, especially after they have given themselves up? Was any such immunity from prosecution, or any order for summary execution, approved by either the Attorney-General or the Home Secretary in the case of the SAS raid on the Iranian embassy.
    The Attorney-General: I must say that I am horrified by that question. There was a certain amount of confusion in the evidence. The matter has been reviewed, in part, in the trial at the Old Bailey, although not all the prosecution evidence was called. It was considered with care at an inquest with a coroner's jury last week. So far as I am concerned the courage and determination shown by those involved, which saved an unknown number of lives of innocent hostages, is a matter of pride for us all. I would especially like to add my admiration for the conduct of police constable Trevor Lock.
    Sir Hugh Fraser: Does not my right hon. and learned Friend agree that this country, compared with any other in the world, shows amazing scrupulosity in the discharge of the function of the State investigating all events pertaining to disaster or tragedy such as that which occurred at the Iranian embassy? This is an attribute of which we might be proud. Surely, it is incredible that a member of the Opposition should try to damage this force—I happen to be a former member of the SAS—and use the House of Commons to attack what were found by the jury to be killings in the interests of the pursuit of the national interest?
    The Attorney-General: I agree with my right hon. Friend. The evidence was reviewed both by the Director and myself. There was no evidence upon which proceedings in relation to the deaths of those terrorists could be justified.
    Mr. John Morris: No one in the House would want to detract from the congratulations offered on the bravery of all those who were concerned in that incident. I say that as a former Minister in the Ministry of Defence. Do I
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    understand from the Attorney-General's earlier remarks that equality before the law is a paramount consideration and, secondly, that, where an offence has been committed, the question of prosecution is examined on the same basis, whoever is involved?
    The Attorney-General: The answer that I gave to the initial question was that the criteria are the same in all cases. The criteria that would apply here are the same as the test which is applied, as the right hon. and learned Gentleman knows, under section 3 of the Criminal Law Act 1967.

    Judges (Tenure)
    Mr. Meacherasked the Attorney-General if he will introduce legislation to set an age limit on the tenure of office of those judges who are not at present covered by age limits.
    The Attorney-General: I refer the hon. Gentleman to the answer which I gave to him on 9 June last, to which I have nothing to add.
    Mr. Meacher: Will not the right hon. and learned Gentleman accept that there are judges over the age of 80 whose judgments are so regularly eccentric and so idiosyncratically out of touch with modern views that they are constantly having to be overturned at a higher level? Does he not agree that geriatric judges with nineteenth-century social ad political prejudice only bring the rule of law into disrepute? It is reasonable that an age limit of 70 should be imposed.
    The Attorney-General: There is only one judge over 80 at the moment.
    Mr. Winnick: Name him.
    The Attorney-General: He reached his eighty-second birthday last week and I would like to congratulate him on it. It is not for me to comment on individual decisions, some of which may be subject to appeal. In 1959 Parliament decided that a statutory retirement age for judges should be imposed. At the same time, Parliament did not impose that upon those who were already appointed judges.
    Sir Charles Fletcher-Cooke: Is not Lord Denning probably the best-known judge in the world? Are not these attacks on him highly resented by everyone who has had the privilege of appearing before him?
    The Attorney-General: If, indeed, there is to be criticism of a judge, there is a well known, recognised parliamentary process for dealing with that situation.
    Mr. Speaker: Order. I did not have the knowledge of the Attorney-General that there was only one judge aged over 80, or I would have intervened. The Attorney-General is right. If anyone wishes to criticise a judge in this place, he should first table a motion on the Order Paper and seek to have it debated.
    Mr. Jeffrey Thomas: Bearing in mind the usual rules about the principle of equality under the law, will the Attorney-General advance any good reason why judges should not be subject to the usual retirement age rules?
    The Attorney-General: I am sure that the hon. and learned Gentleman would be the first to complain if his

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    contract were altered after he had signed it and had acted under it for a period of time. That is what would happen here. Parliament in 1959 decided not to affect the contracts of those who were already appointed.
    Mr. Christopher Price: On a point of order, Mr. Speaker. May I get it right? Is it the case that under our rules we can say nice things about judges but cannot say nasty things about them?
    Mr. Speaker: That applies to many people.

Inner Cities Policy
3.31 pm
The Secretary of State for the Environment (Mr. Michael Heseltine): With permission, Mr. Speaker, I should like to make a statement on the outcome of the review of inner city policy.
The inner city partnership and programme authority arrangements will continue, but I have taken steps to simplify their procedures and intend to consult local authorities very soon on guidelines that will enable programmes to be more efficiently handled.
The private sector should be encouraged to play the fullest possible part. I therefore intend to make effective consultation with local industry and commerce a prior condition of providing urban programme grant. The voluntary sector can also contribute much, and should also be consulted.
I have decided not to make any changes now in the list of authorities with partnership or programme authority status, or designated under the Inner Urban Areas Act 1978. This reflects my assessment of the latest evidence, the constraints on public expenditure and the need to allow time to measure the impact.
I have already announced, subject to parliamentary approval, my intention to establish two new urban development corporations in London docklands and Merseyside. The creation of the London Docklands Developments Corporation will mean the end of the existing partnership arrangements in London docklands, to be succeeded by separate arrangements.
We are planning significant increases in expenditure on inner city regeneration—the total provision in 1981–82 at 1980 survey prices will be some £224 million. Of that, some £158 million will go to the urban programme and £66 million to the two corporations. This latter figure includes some moneys for land acquisition; in addition, the urban development corporations may be able to acquire and redevelop some further land owned by statutory undertakers.
Allocations under the main programme, which, despite reductions, remain the largest components of public investment in inner cities, will continue, where possible, to take into account their needs.
Inner cities remain vitally important to the health of the country. This Government have ensured that more schemes under the urban programme are being aimed at strengthening the local economies and improving the environment, though there will continue to be a role for social and community projects. Our aim remains to make these places where people want to live and work, and where the private investor is prepared to put his money. The changes that I have made and intend to make should ensure that we can mobilise resources as effectively as possible to tackle the problems.
Mr. Gerald Kaufman: Why does the right hon. Gentleman never tell the House the straight truth? Why is he pretending that there is an increase in expenditure on the urban programme when, in fact, he is cutting the main urban programme for 1981–82 by 26 per cent. from the sums of money allocated in the 1979 White Paper?
Why does not the right hon. Gentleman also take into account his cut in rate support grant for the metropolitan
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areas of £440 million, a 10 per cent. reduction? Why does he not take into account his cut of 27 per cent. in the housing investment programme, including a cut of 36 per cent. in London?
Is the right hon. Gentleman aware that
"We cannot afford the waste of resources, of people and of land, represented by areas of dereliction and desolation around our city centres. We cannot risk the build-up of frustration and anger to which such decay gives rise,"
with the effect on
"the elderly, the poor, the new immigrant communities"?
Does the right hon. Gentleman recall that those are the very words that he used in his statement on inner cities policy in September 1979? Is he aware that it is his victimisation of the inner city areas that is bringing about the very desolation, frustration and anger of which he spoke?
Mr. Heseltine: The House will realise that it is a curious sort of victimisation when one announces a record amount of money available to deal with the problem—more than the House has ever been asked to consider.
The right hon. Gentleman is not living in a real world when he tries to compare the increases that I am announcing—increases over past expenditure—with a notional White Paper published by a Government who were subsequently defeated and who had no prospect whatsoever of carrying out those plans if they had been elected.
I totally support the right hon. Gentleman's quotation of my expressed concern about the problems of dereliction in these areas. It was precisely because I felt such concern that I persuaded my colleagues that we should include the proposals for the urban development corporations and the land registers, which were the first really effective attempts to bring together in one organisation the methods needed to cater for the problems.
Mr. Anthony Steen: I welcome the Government's recommitment to the revitalisation of the inner areas, but does my right hon. Friend agree that a number of other Government Departments and local authorities are doing various things that negate his continued efforts to revive the inner cities? For example, the favouring of beet sugar rather than cane sugar is resulting in Tate and Lyle closing its factory in the inner city of Liverpool, which means the loss of 1,600 jobs and £½ million of rate income. There is little point in announcing more money for partnership if the inner city is denuded of 1,600 jobs and £½ million of rate income.
Mr. Heseltine: I know that my hon. Friend shares my concern about the problems of trying to create a better infrastructure and a better climate in the inner cities, but I must ask him to talk to my right hon. Friend the Minister of Agriculture, Fisheries and Food about the specific problems of the cane sugar industry.
Mr. Ian Mikardo: Is the right hon. Gentleman aware that in that part of docklands contained within the borough of Tower Hamlets there has been a notable and rapid increase in the number of entrepreneurs, both large and small, being brought in for job creation and environmental improvement, all of which are doing very well, and that the coming of the urban development corporation will merely throw a spanner into those works?
Mr. Heseltine: It is an extremely cost-effective spanner, in view of the amount of extra resource that will be available, together with the more effective mechanism to cater for the problems. As the hon. Gentleman knows, what I am doing, following the original statement about inner city problems made by the right hon. Member for Stepney and Poplar (Mr. Shore), is to take the concept that the right hon. Gentleman first announced and to give it more public resources and a framework within which it can be more effectively administered.
Mr. David Alton: How does the right hon. Gentleman intend to involve private industry? Will it be through the chambers of commerce? I welcome the right hon. Gentleman's determination to involve the voluntary sector. How is that to be done? Will the right hon. Gentleman comment on the relationship between the partnership committee and the urban development corporation on Merseyside, in view of his statement on the urban development corporation and the partnership committee in London?
Mr. Heseltine: The method of involving the private sector will, in the case of most of the urban programme areas and certainly the Liverpool one, involve consultation with the chambers of commerce, as the most obvious of various candidates that we could consult.
The form of consultation with the voluntary sector is more difficult, because it is harder to identify so clearly the particular organisation that could represent the bodies in it. Nevertheless, as chairman of that urban programme partnership I shall want to see that proper consultation takes place.
The relationship between the partnership committee and the urban development corporation will be achieved by the close inter-relationship between local authorities and the Government in both organisations.
Mr. Fred Silvester: Is my right hon. Friend aware that there are difficulties with regard to inner and outer wards of cities? Is he further aware that the burden of the special problems of the inner cities is to some extent already borne by the ratepayers of the outer wards, who are receiving no benefit under his scheme? Has he given any thought to that problem?
Mr. Heseltine: That brings into focus the difficulty of the outer areas having to bear, through the rate fund, the problems of the inner areas. One of the factors that I have in mind in trying to get more economic momentum into inner city areas is that they should be able to cope with their problems.
Mr. Charles R. Morris: Will the Secretary of State confirm that the figures that he announced today indicate that the city of Manchester will receive about £5 million, which is precisely the amount that it received last year and the year before? Bearing in mind that that city has lost £12 million million in housing subsidies, £10 million in the loss of assisted area status, and £18 million because the rate support block grant does not take account of inner city problems, will the Secretary of State examine the finance that is available to the city?
Mr. Heseltine: I should have thought that the right hon. Gentleman would have noticed that the heavy over-reliance on public expenditure in the city of Manchester has led to a burden on the ratepayers there that is destroying far more jobs than public subsidy could ever
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create. We have pursued these policies in an attempt to ensure that the inflationary rate increases are reduced. It is now up to local authorities to respond to them, and I am delighted that so many are doing so.
Mr. Nicholas Scott: I recognise that the burden of my right hon. Friend's statement is concerned with the run-down areas of inner cities, but does he not agree that there are other areas, particularly in London, that have suffered unduly from the burden of tourism? Will he examine ways, perhaps through the rate support grant, to protect the residents against that burden?
Mr. Heseltine: During the course of the next 12 months we shall have wide and detailed discussions on the factors that will influence the distribution of the rate support grant, and I welcome that. However, there are opportunities for boroughs such as that of my hon. Friend to make applications, through the traditional urban programme, for schemes, particularly small ones, that may help economic regeneration or the voluntary sector, and we consider them sympathetically.
Mr. Arthur Lewis: While I welcome anything that can be done to help the deprived areas, may I ask the Secretary of State how he can cut public expenditure, preventing the London borough of Newham from improving its town hall to allow the physically disabled to enter it, especially in the International Year of Disabled People, and then give further money for other development schemes? Surely the local authority should be able to improve its town hall to enable the physically disabled to go in or out, and surely its budget should not be cut so that money can be given to other programmes?
Mr. Heseltine: If the hon. Gentleman checks on the details of the case that he mentioned he will find that under the flexibility that we have given local authorities on capital expenditure as from next April they are able to cost all their programmes and pursue their priorities. They already have the ability to pursue their priorities on revenue matters. To the best of my knowledge—I will check—there is no way in which it can be suggested that I am responsible for the changes that the hon. Gentleman pointed out. With regard to his general point, the reason why it is right to ask the local authorities to reduce their revenue expenditure, and therefore their rate costs, is partly that I want to release resources for capital expenditure. I am trying to do that now in the East End of London.
Several Hon. Members Several Hon. Members rose—
Mr. Speaker: Order. If hon. Members will co-operate, I shall call those who have been rising in their places.
Mr. Den Dover: I welcome the need for consultation with the private sector, but will my right hon. Friend the Secretary of State give further consideration to the possible membership of the private sector on the partnership committees? Does he not agree that that could lead to better and more effective spending and control of the money, and to a better return for that money?
Mr. Heseltine: I am grateful to my hon. Friend for asking that question, but that is probably not the right way to proceed. The partnership committees are already far too large, and all the people who attend the meetings, which run to perhaps 40 or 50 people, realise that this is not a way

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to make effective progress. To add more people would probably slow up the procedures. I want to ensure that the details of the programmes are more fully considered and explored with the private sector before decisions are made by local authorities and the Government.
Mr. Greville Janner: Has the right hon. Gentleman given consideration to the vast problems of estates that are urban but are not in inner cities, which are hugely disadvantaged and increasingly decimated—for example, the Braunstone estate, in my constituency? Will he consider the definition of an inner city in order to try to bring help to those people who are gravely affected by all the cuts, particularly those in the housing sector?
Mr. Heseltine: The hon. and learned Gentleman will appreciate that it is for local authorities to pursue their priorities in the light of the resources that are available to them. As part of the review, I have had to consider whether I would be wise to spread more widely the limited resources that are available in the urban programme. I have taken the view that for the time being we should stick with the authorities that were originally chosen and give a longer period of experimentation, so that we can assess the working of the programme in an area that is more concentrated than it would otherwise have been.
Mr. Clinton Davis: Was the Secretary of State speaking with tongue in cheek when he spoke about improved consultations with private industry? With regard to Hackney, is he aware that his measures have emasculated private industry and dealt the partnership scheme a mortal blow? Can he say whether the overall effects of his package will improve or diminish the prospects of partnership in Hackney?
Mr Heseltine: I am sure that the hon. Gentleman's memory is not so short that he will have forgotten the reason why there has been so much devastation in the private sector. It is because of the high cost of borrowing, the over-extended programmes for the public sector and the consequent high costs of rates. The Government's policies are essential in order to get those matters in balance.
Mr. John Sever: Will the Secretary of State confirm that he said in reply to a supplementary question a few moments-ago that he and other Ministers found it difficult to interpret what the voluntary organisations were saying to the partnership committees? If that is so, does he not accept that in central Birmingham there is no difficulty in finding out what needs to be done? Is he aware that certain projects are in need of urgent attention, and that the answer to the problem is not a matter of finding a list but of finding the money to pay for the items on the list?
Mr. Heseltine: I do not disagree significantly with the hon. Gentleman. There is no problem in finding a list of projects, but there is difficulty in finding a body that can be claimed to represent the whole of the voluntary sector. It is easier to find such a body in the private sector. However, that does not in any way diminish the need to involve the voluntary sector. I was talking purely about the processes of consultation.
Mr. Jack Straw: Is the Secretary of State aware that his decision to continue the designation of Blackburn and other areas will be greeted with some relief? Is he further aware that the severe cuts that he has
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made in the main programmes that he has made have greatly undermined the borough's ability to deal with the jobs and housing crises in the area? Does he not accept that the number of homes that will be started this year is four, compared with 129 last year, and that the cutting of assisted area status has contributed to the doubling of unemployment over the last 18 months? Is he willing to examine closely the amount of main programme money for inner city area? If he is not, his policy approach will be greeted with a great deal of scepticism.
Mr. Heseltine: Obviously, all Ministers will take those factors into account when allocating their resources. The inner cities receive proper consideration for whatever resources are available for distribution. Perhaps the more serious aspect of the urban programme allocations—an aspect that is of great concern to me—is that since the previous Secretary of State announced the programme, year by year a far higher proportion of available resources has already been pre-empted by the revenue consequences of earlier schemes. As we allocate next year's resources we are finding that there is far less money available, not because new, specifically urban programme schemes have been allocated in the past but because the main programmes have pre-empted a considerable part of the previous urban programme. I am trying—I intend to continue to try in the future—to remove the revenue implications of past schemes in order to have available for annual disposal a far higher proportion of new capital projects.
Mr. Allan Roberts: Will the right hon. Gentleman reconsider his decision not to extend partnership areas? How, for instance, can he justify the fact that the urban development corporation in Merseyside is to extend into my constituency of Bootle but that that part of the Sefton local authority area is not included in the partnership agreement along with Liverpool, when the same inner city conditions pertain in that part of Sefton as pertain in Mersyside? Will the right hon. Gentleman say what percentage of the £66 million allocated to urban development corporations will be spent on Merseyside and what percentage will be spent in London? People in Merseyside are sceptical about the value of the urban development corporation, and they would be less sceptical if they knew that there was to be a significant amount of public money available for public initiatives and that all the money was not going to London.
Mr. Heseltine: The hon. Gentleman will remember, on reflection, that the reaction on Merseyside to the urban development corporation has been extremely favourable. When they learn today that about one-quarter of the funds that I have announced are to flow into Merseyside they will realise that this is a very significant increase in the Government's commitment to the Merseyside area.
As for the hon. Gentleman's specific questions about the areas and the lines that we have had to choose, I am the first to say that no one can pretend that these are as precise or as absolute as the standards that, ideally, one would want. We have had to make a judgment and, broadly, we have supported the judgment of the previous Secretary of State. There are endless anomalies, but wherever we change we shall simply throw up more anomalies. We take the view that as we have not the

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resources to increase dramatically the amount of the commitment that we are making it is as well to stay where we are for the time being.
Mr. Alfred Dubs: The right hon. Gentleman will know better than most hon. Members the enormous financial difficulties facing inner city local authorities as a consequence of other decisions that he has made in relation to the rate support grant. Looking at it in relation to urban aid, is there not a serious danger that as urban aid schemes come to an end local authorities will not have the money to continue them and, therefore, it will be even harder for new schemes to get off the ground? What is the right hon. Gentleman's assessment of the net effect of the money that he has announced for urban aid? Will most of it simply go to keeping old schemes going, with the result that there will be no new ones?
Mr. Heseltine: The hon. Gentleman is very much on the point that I was trying to make in relation to my concern about the hangover of past revenue commitments. I find, for example, that in this year—1980–81—out of a total of £181 million at 1980 survey prices, £67 million—more than one-third—is committed to paying revenue implications of previous years. I want to get that down to a much lower figure in order to free resources every year for more capital schemes. As each scheme is judged on its merits, and as each is free standing, provided that the Government keep up the amount of commitment to the urban programme there is no reason why resources should not be available in any given year for additional new schemes.
Mr. Clive Soley: Is the Secretary of State aware that he is in danger of going down in history as a one-man neutron bomb, devastating people's lives and leaving properties empty and decaying? Is he aware that housing lists are growing whilst public and private house building has almost ground to a halt and builders are going bankrupt, and that there is no way, important as it is, that the voluntary sector can fill the gap? Is not this a half-hearted and pathetic attempt, which does not even maintain the status quo?
Mr. Heseltine: The hon. Gentleman should remember that public sector housing is today the subject of a capital allocation of more than £2 billion and that the Housing Corporation has expenditure programmes of more than £400 million. It makes no sense to describe the problem in the terms that the hon. Gentleman does. If we pursued higher revenue expenditure programmes in the areas about which the hon. Gentleman questions me it would lead automatically to higher levels of rates, and that would accelerate the industrial decline that we are trying to avoid.
Mr. Ken Eastham: May I take the right hon. Gentleman back to his shabby remarks to my right hon. Friend the Member for Manchester, Openshaw (Mr. Morris), who referred to Manchester and its problems? I remind the right hon. Gentleman that as a direct result of his policies and the wicked denial of rate support grant he has cost the city about £17 million, which will greatly accentuate the problems of the inner city. What is the Government's policy towards the commitment of the Labour Government? Are they still committed to a 10-year programme for the inner cities?
Mr. Heseltine: Since I have announced a record amount of support for inner cities, it was my hope that the hon. Gentleman would recognise that it is an indication of the commitment that I have to this aspect of my policy. However, I must tell him that the need for economies in local government is self-evident everywhere, otherwise the implications for the rates and the burden on the private sector are unbearable. The higher the levels of rate increases, the more jobs will be lost as a direct consequence. This is the trade-off that must be understood by local authorities as they fix rate levels for the coming year.
Mr. Speaker: I have received notice of three applications under Standing Order No. 9. I shall call them in the order in which they were submitted to me.

Collier "Nellie M"
Mr. Wm. Ross: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the sinking of the British vessel, the 'Nellie M', in Lough Foyle on the night of Friday-Saturday last by an IRA pirate gang."
I believe that this is a very important matter for my constituents and for national defence because, since 1920, when the Republic of Ireland seceded from the United Kingdom, the sea boundaries have never yet been decided. To this day, no chart or map with an international boundary line drawn on it exists for Carlingford Lough or Lough Foyle. The result is that this vessel having been attacked and sunk, there is no way of knowing in whose waters the wreck now rests.
This is a matter that should have urgent consideration. It must be resolved before the wreck is dealt with, in order to decide who is responsible for it. I believe that it would be very dangerous for the nation to allow our claim to the waters of Lough Foyle to go by default, in view of the problems that could be created for national defence and for the commercial activities of my constituents.
Mr. Speaker: The hon. Member for Londonderry (Mr. Ross) gave me notice before 12 o'clock today that he would seek leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he believed should have urgent consideration, namely,
"the sinking of the British vessel, the 'Nellie M' in Lough Foyle on the night of Friday-Saturday last by an IRA pirate gang."
The House will have listened with deep concern to what the hon. Gentleman said. He has undoubtedly brought our attention to an important matter. But he knows that under Standing Order No. 9 I am directed to take into account the several factors set out in the Order but to give no reason for my decision.
I listened with care to the hon. Gentleman, but I must rule that his submission does not fall within the provisions of the Standing Order and, therefore, I cannot submit his application to the House.

Litherland High School
Mr. Allan Roberts: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,

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"the accusations of excessive beatings at Litherland high school, Sterrix Lane, in my constituency, and what seems to be a breakdown in law and order at this school."
This matter is specific because, it relates to a secondary high school that, over the last two weeks, has featured in the news since a school teacher at the school, Mr. Alan Corkish, revealed that 1,895 slipperings had occurred over the last four terms—which is eight a day and one every 35 minutes in respect of only 400 boys—including such cases as one boy being beaten seven times and another five times in a two-week period.
Even the advocates of corporal punishment in schools claim that it should be used only as a last resort, for its deterrent value. This is far from the situation in Litherland school, where violence, institutionalised in the way that it is, seems to be the norm rather than the exception.
The matter is important, because recently there seems to have been an almost complete breakdown in the school's functioning and discipline. Accusations are being made of such things as illicit beatings, over and above those that I have mentioned already, not being recorded in the punishment book, thus breaching Government regulations. They include allegations of the use of an unorthodox cane, an unauthorised teacher giving corporal punishment, and regular slappings and cloutings, resulting in one teacher appearing before the governing body following complaints from parents.
Near-riots seem to have broken out in the school, including allegations of teachers turning a hosepipe On children. These riots or demonstrations seem to be inspired by the children themselves, on behalf of Alan Corkish, the teacher who made public the school punishment book and who is to attend a disciplinary hearing of the school governors tonight. No disciplinary action is necessary. Either the head and the governors of the school are not ashamed of their punishment book and should not object to it being made public, or they are ashamed and Alan Corkish was more than right to make it public.
This matter is crying out for urgent consideration by the House for two important and urgent reasons. First, the House has been misled by the Secretary of State for Education and Science and his Under-Secretary. On Friday 6 February I asked the Secretary of State for Education and Science
"if he will arrange for Her Majesty's inspectors to visit Litherland high school, Bootle, in the light of accusations of excessive punishment in that school."
The Under-Secretary replied:
"Discipline within the school is a matter for the head teacher, acting within any guidelines issued by the local education authority. It is not the function of Her Majesty's Inspectorate to investigate complaints about cases of corporal punisliments."— [Official Report, 6 February 1981; Vol. 998 c. 225.]
That reply is not only totally inadequate but inaccurate, as the Secretary of State has power to intervene in circumstances such as those pertaining at Litherland High School. Under the Education Act 1944—
Mr. Speaker: Order. The hon. Member for Bootle (Mr. Roberts) is testing the patience of the House in relation to our Standing Order No. 9 procedure. He is also endangering it. The hon. Gentleman cannot make the speech that he would make if I were to grant his application.
Mr. Roberts: Finally then, this matter needs to be debated urgently, mainly because the Secretary of State
612
has already misled the House. Under the Education Act 1944 he has the power to intervene. I am sure that he did not mean to mislead the House.
Therefore, I hope that you will be able to grant an emergency debate, Mr. Speaker, in order to clear the air in my constituency and in the House and to satisfy the parents of the children at the school, if no one else.
Mr. Speaker: The hon. Gentleman gave me notice before noon today that he would seek leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he thinks should have urgent consideration, namely,
"the accusations of excessive beatings at Litherland high school, Sterrix Lane, in the hon. Member's constituency, and. what seems to be a breakdown in law and order at this school."
I have to rule that the hon. Gentleman's submission does not fall within the provisions of the Standing Order and, therefore, that I cannot submit his application to the House.

National Union of Seamen (Dispute)
Mr. Clinton Davis: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the dispute between the General Council of British Shipping and the National Union of Seamen."
The matter is clearly specific. The dispute has entered its fifth week. Efforts to conciliate by ACAS—the last being on Saturday—have failed and the dispute now shows every sign of being stepped up.
The matter is also of great importance. Merchant shipping is a vital industry to the economy, not least for the invisible earnings which it produces. The security and well-being of our seafarers is essential for the future prosperity of that industry. The dispute is damaging to the merchant fleet, the seamen and the nation's trading position. Ships are tied up all over the world.
The matter is urgent because each day the situation appears to deteriorate further, with attitudes hardening on both sides and with the ensuing bitterness which could seriously prejudice industrial relations for years to come.
The Government have a role and duty which so far the Department of Trade has refused to fulfil. They should use every opportunity at their command now—as the Opposition have consistently asserted—to seek to persuade both sides to accept independent arbitration with the widest terms of reference, incorporating not only the offer made by the employers and the payment of proper overtime earnings, which is the heart of the dispute, but the issue of the industry's international competitiveness, with particular reference to the developed maritime nations.
The door of arbitration is just ajar. The Government should see that it is now opened wide. The House of Commons should urgently be given the chance to debate this matter which is so important to our national interests and to put to the test the decision of the Government to stand back and abdicate responsibility.
Mr. Speaker: The hon. Gentleman gave me notice before noon today that he would seek leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he thinks should have urgent consideration, namely,

613
"the dispute between the General Council of British Shipping and the National Union of Seamen."
The House will have listened with considerable concern to what the hon. Gentleman said in giving the reasons why we should have a debate. The House will be well aware that this procedure is by no means the only way in which this matter can be discussed. My powers are strictly limited by the House on the question whether the matter is of such a nature that it must be discussed tonight or tomorrow. That is the extent of the powers that the House has given me.
As the House knows, I am directed to give no reasons for my decision but to take into account the several factors set out in the Standing Order. I listened with concern to what the hon. Gentleman said, but I have to rule that his submission does not fall within the provisions of the Standing Order and, therefore, that I cannot submit his application to the House.
INTERNATIONAL ORGANISATONS BILL [Lords]
Ordered,
That the International Organisations Bill [Lords] be referred to a Second Reading Committee.—[Mr. Gummer.]
MERCHANT SHIPPING BILL [Lords]
Ordered,
That the Merchant Shipping Bill [Lords] be referred to a Second Reading Committee.—[Mr. Gummer.]
PARLIAMENTARY COMMISSIONER (CONSULAR COMPLAINTS) BILL [Lords]
Ordered,
That the Parliamentary Commissioner (Consular Complaints) Bill [Lords] be referred to a Second Reading Committee.—[Mr. Gummer.]

Orders of the Day

  Employment and Training Bill
  Order for Second Reading read.
  4.7 pm
  The Secretary of State for Employment (Mr. James Prior): I beg to move, That the Bill be now read a Second time.
  I apologise to the House for the erratum concerning the explanatory and financial memorandum, in which line 3 was left out by mistake. It is now being reprinted and will be put right before the weekend. I apologise to the House for that important omission.
  I believe that it will be convenient for the House if I take the two main purposes of the Bill—the powers they confer, and the changes they make—and then discuss them in terms of the nation's training needs. Dealing with the Bill in that way may enable the House to understand why the Government believe that the change in powers is necessary and will no doubt assist the House in giving me its views on an immensely important and difficult subject. I also hope that my speech will show that this is not as controversial a Bill as some hon. Members are prepared to think.
  The amendments introduced by clause 1 are particularly important because they will allow greater flexibility in taking decisions than the current law would allow. It is right that decisions about the future pattern of industrial training boards should rest with me, because I am the Minister accountable to Parliament. Clause 1 therefore proposes that the Secretary of State should have power to create, abolish or change the scope of an industrial training board in consultation with the Manpower Services Commission and not, as at present, only in accordance with a recommendation of the commission. The commission's views will continue to carry great authority, but it is important that I should not be restricted in the range of options open in determining the future structure of the training system. As I shall seek to show, diverse views may be put to the Manpower Services Commission which will make it impossible for it to make recommendations. It would be unsatisfactory if I could not act, if I had to wait until the review was over before putting any proposals to Parliament.
  The current review of industrial training arrangements by the commission will be the first comprehensive review of its kind. The existing legal requirements envisage consultation with interested parties only on specific propositions and are not apt for the purpose of such a wide-ranging review as now envisaged. Clause 1 therefore provides for a more flexible consultation procedure in future, and will enable me to act on the outcome of the review being undertaken.
  Clause 2 will enable all expenses of an industrial training board, including operating and administrative expenses, to be met from money raised by a levy on employers, as was the position before the coming into force of the Employment and Training Act 1973. Clause 2 will also enable boards to use to defray their operating expenses money derived from levies imposed before the enactment of the Bill.
  These provisions are necessary as a result of the Government's decision to withdraw Exchequer funding of

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  boards' operating costs. I should like to remind the House that when industrial training boards were first established under the 1964 Act their operating costs were charged to their industries. However, when firms became entitled to exemption from levy if they trained to meet their own needs, it meant that relatively few firms might remain liable to pay levy. Obviously they could not be expected to pay all the operating expenses. Provision was therefore made in the 1973 Act accordingly, and since then the Government have met the cost of the operating expenses. In many respects, this has not worked well. It has led to an increase in bureaucracy and inefficiency and many complications about the pay and conditions of staff.
  The MSC review body recommended therefore that boards' operating costs should once again become a charge on their industries but, as one would expect, with some dissenting voices. The CBI commissionerss did not feel able to support the recommendation while the TUC commissioners were prepared for the transfer to be phased over three years. I think this reiterates the point that at the end of the day it is necessary for the Minister to have power to act.
  After careful consideration we decided that all the boards' operating costs which since 1974 have been met from public funds should be transferred to industry within a relatively short time scale. Basically we consider it right in principle that where a board continues on a statutory basis the running costs of that board should be met by the employers concerned. Secondly, we agree with the MSC review body that it is an important way of increasing the boards' accountability to their own industries.
  However, I recognise the difficulties. It is not our wish to impose on industry additional burdens at this difficult time. The extent of the future costs will not emerge until the review has been completed, and it is clear which boards are to remain, and what is to be their scope. The Government will therefore be prepared to consider the timing of the end of Exchequer support in the light of the outcome of the review. The provisions of clause 2 are therefore to be brought into force by a commencement order. When clause 2 is in force it will of course be for the industries concerned to ensure that their boards keep down their administrative costs.
  Before leaving the subject of boards' powers to raise levies I would draw the House's attention to an important change recommended by the review body which we have decided not to implement. The review body considered that boards had been unduly restricted by the need to apply for an affirmative resolution of both Houses if they wanted to raise a levy which represents more than 1 per cent unit of the money employers had spent on wages and salaries in any one year. This recommendation was heavily criticised in the comments received during the consultation period.
  I have examined these criticisms carefully and concluded that it would not be right, particularly at a time when boards may be raising levies to meet their own operating costs, to remove this important control mechanism. In my view, a levy of more than 1 per cent. should remain subject to affirmative resolution, of the House.
  Mr. Frank Hooley: If there is still to be a statutory limitation on the levy but the boards have
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  to carry operating costs as well as other costs, does that not mean that they will have fewer resources to devote to training as such?
  Mr. Prior: Not necessarily, because some boards have levies of less than 1 per cent., so there is some room there. If they feel that their operating costs cannot be met from a levy of 1 per cent., it will be up to them to decide whether they wish to come to the House for an affirmative resolution to permit them to go above 1 per cent. Alternatively, a number of chairmen of boards have told me that they believe that they can keep their operating costs down a good deal more than they are at present. That is one purpose on which I am very keen.
  One of the main points constantly put to me by chairmen of boards is that the growth of bureaucracy in dealing with the Manpower Services Commission and in turn with the Department of Employment and in turn with the Civil Service Department has added considerably both to the time spent and to the costs of running the boards. I do not think that what the hon. Gentleman has said need happen, but we can examine it in greater detail as the debate goes on.
  These are the main issues covered by the Bill. My hon. Friend will of course be prepared to deal with the other clauses and other points which hon. Members wish to raise, but I wanted to give the House the logic behind what the Government seek to do. I should now like to amplify it by looking at these proposals in the context of training policy generally.
  In doing so, I should like to remind the House that in my speech in the debate on the Loyal Address on 26 November last year I set out the Government's broad objectives on training. I also announced then that as one element in our overall policy we would be reviewing the system of industrial training boards.
  I believe it is right, therefore, to view the Bill principally as an enabling measure. The Bill does not prescribe this or that particular reform. Its purpose instead is to enable reforms to be made in the operation and structure of ITBs. It is preparing the ground so that the necessary changes can be made following the outcome of the present review, which is due to finish in the summer.
  I want the House to be clear about the context of the review and of the Bill within the Government's overaJl policy on training. I think that there would be agreement on all sides that over the years our training and retraining have not been conspicuously successful. Of course, there has been some progress. But even so, time and again we have seen economic growth choked off by skill shortages in key sectors of the economy. The cases are legion where a firm's inability to recruit skilled staff has led to a loss of an order. In turn, this has led to fewer jobs for the semiskilled and the unskilled.
  I do not believe, therefore, that there is any serious disagreement in the House that our training system needs to be made more effective. The differences emerge on the best means to achieve that end. This immediately leads to questions about appropriate levels of spending and suitable types of structure.
  This brings me to the two central arguments which I am sure will feature strongly in today's debate and over the coming months. The first is the argument about the level of spending. There can be no doubt that over the past 10 or 15 years vast sums of money have been spent on training, both by Government and by industry. The overall

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  amount is probably incalculable. Yet, as I said earlier, none of us is satisfied with the result. Therefore, the key issue on which the debate should focus is how we can make sure that the large sums that we will continue to spend can be made much more effective. We could all think of dozens of ways to spend more money on training—on one scheme or another. But at the end of the day what counts is how effective the spending has been. It is this consideration—of getting a much better return on the money spent—which will be the underlying principle of the Government's approach.
  The same thinking should guide our approach on the structures which we need to develop. As with the debate on spending, it is all too easy for the argument to polarise; some will say that we need to scrap every existing institution, others that if the present structures are inadequate we must need more and more of them. But the key issue here on which I believe the debate should focus is what reforms should be introduced so that we can see that we are meeting the objectives which the institutions, or structures, were presumably meant to achieve. The outcome of the current review of industrial training boards will put us in the right position to make these judgments. The Bill will enable us to act on those decisions and help to secure a more effective training structure.
  I want to emphasise one other key principle which I believe should guide our thinking and shape our discussions. It is one which none of us can dodge, and which we should face up to fairly and squarely, namely, the impact of the sheer pace of change. The economic and social history of the past 30 years has been one of rapid change. Britain's story during that period has been one of failing to keep up. We have been slow, inflexible and unresponsive. Sadly, our training system has been no exception. Indeed, its failure to adapt quickly enough lies at the root of its ineffectiveness.
  But far from slowing down, change is crowding in on us faster than ever before. We have entered a new industrial revolution—the microtechnology revolution, or the telematics revolution, whatever one prefers to call it. That economic revolution is unique. As Daniel Bell pointed out in his introduction to the Nora report on telematics and the computerisation of society which was commissioned by President Giscard d'Estaing:
  "We can self-consciously witness a large-scale social transformation."
  Whereas very few people realised the import of the Industrial Revolution when it was taking place, there is now a much greater awareness of the significance of the changes taking place around us.
  With that awareness, it would be a terrible folly if we continued to be unresponsive to change and remained inflexible and hide bound by traditional thinking. Training and retraining are areas where it is absolutely vital to introduce a much greater sense of flexibility and responsiveness. There will be new demands, new pressures and new opportunities. Our duty, therefore, must be to devise a system which can adapt and respond to them, and which can thus enable us not only to keep up with the pace of change, but also to make the most of the opportunities which lie ahead.
  That is why it is vital today that we view the Bill in its proper perspective. It is one element in the Government's overall policy on training. It is not the central element, nor
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  the predominant one. It should be viewed as one essential part in a package of measures designed to establish an effective and systematic approach.
  The Government's key objective is to change industrial training so that it better meets the needs of industry, first, by providing a solid foundation training for all, and, secondly, by reducing restrictions on the provision and use of trained workers, both young people and adults. We intend to publish our proposals for a new training initiative shortly. We hope to be able to do so in conjunction with the MSC.
  I want briefly to outline the key components which will shape our new training initiative. First, there is considerable scope for improving the vocational preparation of young people. The vast bulk of young people who go into work at 16 or 17 years of age receive little or no training in even the most basic skills. We lag far behind other countries such as West Germany or France in that regard. As I have already made clear to the House on previous occasions, the Government are committed, as resources permit, to work towards the point where every school leaver will undertake a programme of vocational preparation. We are expanding the current pilot scheme, and in time we should look to the development of the youth opportunities programme in that direction.
  There has also only been slow progress in modernising current arrangements for training for skill within industry. Their effectiveness varies considerably, but in some traditional craft apprenticeships there is a need to remove age restrictions and to place much greater weight on the attainment of recognised standards of performance. Tests of trainee performance after particular phases of training are already applied in certain schemes, but we need to build on such developments and make them more general. Jobs entailing the exercise of skill and responsibility should, as far as possible, be open to all who can do them, and not be artificially restricted. Ernest Bevin, whose centenary of birth we celebrate next month, once said that Britain was a remarkable country because it was possible for him, a docker, to become Foreign Secretary. Yet if he had wished to change his occupation from a docker to a skilled engineer, he would not have been able to do so after the age of 19.1 think that the House will agree, despite the difficulties, that there is a need for a change of this nature.
  Mr. Jim Craigen: Does the Secretary of State envisage introducing legislation to remove the age restriction in an area which, until now, has been left to voluntary agreement between employers and trade unions?
  Mr. Prior: No, I do not envisage legislation. It must be done carefully. The maximum co-operation is required. I hope that my remarks in that regard will receive a fair wind from the House, which could have an important bearing on the attitudes of both employers and unions.
  However, training for skill needs to be seen in much broader terms than just craft apprenticeships. Systematic and flexible training needs to be developed for a wide range of other occupations at both higher and lower levels of skill, such as in the computer field, where at present the Manpower Services Commission is assisting a significant number of training places through the TOPS courses, which were referred to very favourably in The Observer yesterday. The number of people completing courses has

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  increased from slightly over 2,000 in 1978–79 to 3,196 last year, and more than 4,000 this year. That is one example of what I mean by getting our priorities right.
  Perhaps the most pressing issue of all is the need to improve provision for the training, retraining and upgrading of adults. The pace of change in the structure of employment and skills required by new technology means that many workers will need to be retrained, not only once but perhaps two or three times during their working lives. Only through the relatively rapid training and retraining of adults are we likely to be able to meet changes in the future demand for existing skills. The TOPS scheme is a great help, but resources are limited. The main need is for more systematic provision for such training within industry. Industrial training boards have had some success in opening up training in certain occupations to adults, but overall they have found it difficult to make much real progress.
  In the expansion of adult training I see an important role for utilising the new technological systems which are now becoming available. At my request, the MSC is currently examining the possibility of promoting "open" or "distance" learning for what might broadly be described as technical and supervisory levels. Any such "open tech" programme would be developed and implemented in close collaboration with existing educational and training resources. It would make the most of locally available facilities and experience. The aim would be to give people access to courses of study to training programmes which they could pursue without giving up full-time employment or the search for work if they were unemployed. That could be a very valuable way of using modern methods and approaches to help individuals to equip themselves with the skills they need.
  We shall make little progress towards achieving any of the objectives which I have mentioned without closer co-operation and understanding between those responsible for training and those responsible for vocational education. In certain industries and localities there is a record of successful co-ordination of education and training interests. But throughout the country as a whole there is still considerable room for improvement. We are urgently studying ways of improving links between training and education at the present time.
  I want to set today's debate in the context of the Government's general approach and our proposals for a new training initiative. I have set out the areas in which I believe we need to improve industrial training because these will largely determine our choice of the most appropriate institutional framework for the future. Industrial training boards have formed the basis of the industrial training system for half the economy for the last 16 years. I think that most people would agree that a review is probably overdue.
  It is not the Government's intention to pull everything up by the roots, just for the sake of doing so. As a farmer—as my right hon. Friend the Chief Whip will know—I do not think that it is very good practice to pull everything up by the roots to see how it is growing and then put it buck again. But we now need a proper review. We shall wait until this review is over before we make up our minds.
  Mr. John Evans: I am rather puzzled by the right hon. Gentleman's speech. He has already told the House, as he told the House in November, that there is to
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  be a review by the MSC of the workings of industrial training boards. He has announced that he wants to set up a new framework for industrial training. Would it not have been better to have this debate before he promoted the Bill, which will give him extraordinary powers to abolish training boards. Would it not have been better to have the MSC review and then a debate on the findings of the MSC review before bringing legislation before the House?
  Mr. Prior: I do not think so—I thought that I had made that clear in my opening remarks—for the simple reason that, again, this would introduce a whole further series of delays in taking any action. It is bound to do so. Already a year has gone by during which we had the review of the Employment and Training Act. That has now led to the Bill and to what I said during the debate on the Queen's Speech. The review of individual training boards is now going on. If at the end of all that I have to wait for another Session of Parliament before taking any action, it would be a further year before any results could come out of that review.
  I do not believe, on an issue which I do not think is very controversial—[Interruption.] I know that the Opposition, for their own purposes, may try to make it controversial. For one thing, they have put on a three-line Whip for this evening, which seems an extraordinary thing to do. But I do not believe that this matter need be controversial. I believe that we need to get on with it. One of the things that we cannot afford to have is a constant state of uncertainty in this sphere. [Interruption.] If the Opposition want simply to continue exactly the same system as we have now, they had better say so. I do not believe that that is the requirement for training in the 1980s. I want to make that clear. But nor do I believe that it would be in any way right to continue a period of uncertainty, which there is bound to be as a result of the review—any review will create a period of uncertainty—for any longer than is really necessary.
  Therefore, I think that Opposition Members would be doing themselves a favour, and would be doing the training boards and training a favour, if they accepted that this review ought to be carried out and that we ought to have the legislation available to the Secretary of State so that he can act as a result of the review as soon as it is completed.
  Dr. Keith Hampson: Many Conservative Members understand the need for urgency. However, will my right hon. Friend reassure us that the MSC will not jump the gun on this matter? There is a rumour that it is already planning an increase of over 800 in its staff. Many of us feel that it would be wrong to replace industrial training board advisers with a new monitoring bureaucracy in the MSC.
  Mr. Prior: I can give that assurance, because that is not what the MSC is telling me. Under difficult circumstances, I am making very considerable cuts in the MSC. Over four years—and I am perfectly proud and happy to say so—I am making a cut of over 20 per cent. in the numbers employed in the MSC, with the exception that because of the increase that] announced in the employment measures before Christmas there will be an additional 900 people, approximately, employed for the YOP and the community enterprise programme. But, generally, the MSC is having to accept a cut. I think that I am right in saying that it is 21·4 per cent. of its total

  621
  manpower. I am determined that we should spend the money on training and not on bureaucracy. That is why I want to get on with this as quickly as possible.
  Mr. Ron Leighton: Will the right hon. Gentleman give way?
  Mr. Prior: I have really stirred things up now. I wanted to keep it quiet. I do not want all this bother.
  Mr. Leighton: I am grateful to the right hon. Gentleman for giving way. Will he explain what will happen to the £50 million Exchequer support that he is removing? Will this mean that less is to be spent on training?
  Mr. Prior: No, not necessarily. It means that if all the training boards were kept and if all the operating costs were transferred at one time to the industry, most of the £50 million which is at present being provided by the Government would then be paid for by the industry. When I say "most", that would be if all the training boards were kept. I say "most" because I believe that in those circumstances the training boards would find that their operating costs came down very considerably. There is no doubt at present that it is the increased supervision and accountability which requires training boards at all times to consult the MSC, which in turn must consult the Department of Employment, which in turn must consult the Civil Service Department. It does not end. All this is adding to the operating costs very considerably. Therefore, it would not involve all of that £50 million. There would be a saving even if we kept the statutory requirement for all training boards.
  It is far too early as yet, before the review has even taken place, for anyone to know how much of the operating costs will be transferred, and when they will be transferred, from the Government to the industries concerned, and whether or not there are other arrangements that we can make for boards instead of having statutory boards.
  Mr. David Ennals: Before we leave the question of financing, may I ask the right hon. Gentleman whether the timing of the Bill is not entirely in order to save money now? Is not the argument that he has used, that he wants to complete his review, and so on, simply a cover-up for a cuts exercise? What view does he take of the CBI's opinion that it should be for the Government to give assistance rather than imposing another burden on industry?
  Mr. Prior: I have already tried to deal with the latter point. The CBI is certainly not saying that it should be for the Government to give assistance. Very largely, the CBI's view is that only a number of statutory boards need remain and, therefore, that the operating costs of boards would not fall on anyone because the boards would be done away with. As for the right hon. Gentleman's other point, if there are financial savings to be made and if this review is long overdue, what is the point of waiting? Why do we have to spend money that we do not need to spend? Let us get on with it and save as much of it as we can as quickly as we can. What we on the Conservative Benches are concerned about is getting the training done, not necessarily spending the money.
  Mr. Richard Needham: I accept the need for this review. However, will my right hon. Friend confirm that it will be extremely difficult for many employers, when confronted by this review by the MSC and feeling that they may have the cost transferred on to them and away from the Treasury, perhaps to give quite as objective a view of ITBs as they might otherwise do? Will he confirm that that factor will be taken into account when it comes to determining the results of the review?
  Mr. Prior: I generally consult my hon. Friend before making my speeches, but on this occasion, if he will have patience for a minute or two, I shall come to that problem in what I have to say, so I now return to my speech.
  Any assessment of the value of industrial training boards must be based on the recognition that, ultimately, responsibility for training rests with individual employers. They must gauge their future needs for particular types of skill. They must decide how to meet those needs, and what part training should play. Industrial training boards were established primarily to influence the quality and quantity of training which employers provide. In carrying out this task they can use levy exemption and payment of board grants as incentives to encourage employers to follow their recommendations but in the end everything depends on their skills of persuasion.
  Over the 16 years since the first boards were established the system has grown to a point where there are now 24 separate boards, each with its own staff and most with levy, levy exemption and grant schemes. In a recent survey, a sample of firms with industrial training boards were asked whether they would have done as much training without their boards. Over two-thirds of them agreed that they would have done. Reseach into the impact of levy exemption schemes which included inquiries to boards themselves suggested that levy exemption had helped to improve the quality of employers' training but produced little evidence that it had increased the quantity of training.
  These findings are, of course, only part of the whole picture. The research to which I have just referred also indicated that firms in boards were more likely to have planned training for all grades of staff, and to have increased their training in the last five years, than firms not in boards.
  Clearly—as one would expect—many boards have had a significant impact on employers' awareness of their training needs. Nevertheless, this evidence is consistent with the conclusion that several of these boards may now have outlived their usefulness. This conclusion is reinforced by the judgment of the MSC review body in "Outlook on Training" that, on the whole, boards have not been effective in meeting the special needs of small firms, or of cross-sector skill shortages or the skill shortages which are confined to local labour markets. These are areas where Britain's performance has remained weak. The main thrust of the employers' comment—and this is where I come to the point made by my hon. Friend the Member for Chippenham (Mr. Needham)—during the period of consultation on the MSC review body's recommendations was against the continuation of statutory boards. I shall read to the House a passage from the comments of one employers' association which illustrates the arguments used. [HON. MEMBERS: "Which association?"]

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  I am not saying which association because I shall quote one association and members of the same association who have a different view.
  The employers' association said:
  "The Association recommends that the training boards, (having achieved their primary objective, and having consolidated it over recent years), should be phased out. No further improvement in training will be achieved by their continuation. Nor does the Association believe that the quality or quantity of company training would decline were the boards to disappear … The phasing out of training boards on the grounds that they have met their fundamental objectives, and no longer have an existence that can be justified, would not only release resources within companies which are being diverted from the main priority of imparting skills, knowledge, enthusiasm and commitment. It would also allow board staff to be redeployed out of negative bureaucratic activity into jobs where they could make a positive and immediate contribution to improving national resources either directly within industry or within other Government agencies seeking to improve the relevant capabilities of the population".
  That was the view against the continuation of training boards. By contrast, some employers wrote strongly supporting their board and pleading for its continuation. I quote:
  "I speak from enlightened self-interest and would consider it a grave mistake if the board to which my company is in scope were to be totally dismantled. We have received from them considerable assistance towards a high professional standard here."
  Against this background of conflicting views, it will be difficult to decide what changes should be made to the current system. Nevertheless, I am sure that it is right that we should now examine carefully how far we can move away from past preoccupations with structures and towards a greater scope for voluntary training arrangements. I believe that many firms which now recognise the value of planned training will continue to have adequate training programmes even if the incentives of levy exemption and board grants have been removed. Equally, I concede that this may not hold good universally, and in some sectors it may be necessary to retain statutory boards.
  The important thing is to reach the right solution for each sector and not to try to devise one formula for the whole of industry. The MSC review body was rightly concerned to make a general review of the industrial training system. But it did not investigate in detail the future training needs of each sector. I therefore strongly supported the review body's recommendation that there should now be a separate review, in full consultation with industry, of the future training arrangements for each sector, including those sectors which already rely on voluntary training arrangements. It is, of course, on the basis of this review that the Government will take decisions on the future of industrial training boards this summer.
  At a time of grave unemployment but with the promise of the upturn to come, it is appropriate for us to look at the manner in which we shall provide the skills of tomorrow. The Bill has limited objectives, but it should be seen as part of a much greater training initiative. In that light, I commend it to the House.
  4.46 pm
  Mr. Harold Walker: One of the advantages and compensations of being in opposition is that one has the chance to watch television on a Saturday night instead of toiling over red dispatch boxes. Recently I have learnt what is meant by a "snow job", as depicted in television serials. That is what we have had this
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  afternoon. The Secretary of State made a deliberate attempt to play down a highly controversial issue. If it is so innocuous and uncontroversial, why have hon. Members been deluged with representations? Why has such concern been expressed?
  It would have helped the House, our debate would have been enhanced, and hon. Members would have been better placed to make a judgment, if we had been able to share the information contained in the MSC's corporate plan. The plan has been prepared. I understand that it has been with the Secretary of State for some weeks. I tried hard to obtain a copy. I understand that as a result of my representations last week a single copy has been placed in the Library, and that the commission was waiting for the Secretary of State's views before it released the plan.
  Last year the Select Committee on Employment recommended that the plan be published and made available to Parliament before it was approved by the Secretary of State. The commission said that it accepted that recommendation. Why is that plan not available to all hon. Members?
  Mr. Prior: The Select Committee said last year that it should examine the plan before it was approved by me. It did so this year. It made certain recommendations, which I received the week before last, on a Friday. It is right that I should take into account the recommendations before I write to the commission saying whether I approve it.
  Mr. Walker: I do not challenge that. That is not the point. What the Select Committee said is on record. It said that the report should be published and made available to Parliament before the Secretary of State approved it. The commission accepted that recommendation without qualification. The report has not been made available to hon. Members, although it is of crucial importance to our understanding of the Bill. It is also important because the Secretary of State has had access to information that has been denied to hon. Members.
  The commission is the authoritative voice of both sides-of industry and of local authorities as regards national manpower policy. Indeed, until now, it had been assumed that it was also responsible for the generation and implementation of that policy. That assumption is in the process of being demolished, no doubt to the delight of some Conservative Members. It is important that the plan should be made available to hon. Members, at least—should the Bill be given a Second Reading—before any discussion in Committee. The summary has been published in the Employment Gazette. As a result, we know that the commission and the Government are in clear and open conflict. That is what clause 1 is all about.
  If there were no conflict, clause 1 would be superfluous and redundant. The Secretary of State mentioned the MSC review body's report entitled "Outlook on Training". I invite the House to look at the document. It is available in the Vote Office and was published by the commission in July 1980. The Secretary of State repeatedly referred to the review that he has asked the commisssion to undertake. The House should be aware that a review has already been carried out. Early in 1979 the commission, under its chairman, Sir Richard O'Brien, set up a powerful body to review the workings of the Employment and Training Act 1973.
  One hesitates to accuse a Minister of deliberately misleading Parliament, but the right hon. Gentleman did

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  not—by a long way—fairly reflect the views of the review body that are set out in the report. Contrary to what the right hon. Gentleman said, it came down heavily in favour of the present industrial training board structure. It said:
  "The existing basic statutory framework for influencing training within industry has a number of important strengths which are relevant to all of our priority objectives for training in the 1980s …. The right approach for the future is to build upon them and not to cast them aside."
  I invite the House to obtain a copy of the document from the Vote Office. In paragragh 8, it argues in detail in favour of statutory industrial training boards. In paragraph 8.7, the report concluded:
  "Radical changes in the existing structure would cause massive disruption. … Alternative structures would have to have clear advantages indeed to justify risking a major hiatus in training effort in a decade in which training will be of great importance. We have not been convinced of the reality of those advantages; nor, it is clear, have the great majority of those who submitted evidence to us."
  In the light of such strong and unequivocal views, the statement made this afternoon, and that which the right hon. Gentleman made on 26 November 1980, seem incredible. The right hon. Gentleman seems to have disregarded everything that the review body said. Four months after the publication of its report, the Secretary of State declared his aim. That aim is on record, and was repeated by the Earl of Gowrie in the other place on 10 December. He wished to ensure that there was no misunderstanding and to indicate that the words had been carefully thought out. The Secretary of State said:
  "The Government's aim will be to extend the area of reliance on voluntary arrangements as far as possible, and to keep statutory industrial training boards in a few key sectors". —[Official Report, 26 November 1980; Vol. 994, c. 688.]
  The right hon. Gentleman did not repeat those words today. He wanted to obfuscate them, it seemed. In other words, this Bill seeks to make radical changes of the kind that the commission's report said would cause "massive disruption." The Bill is to be the instrument of those radical changes. I fear that it will have the consequences that the report forecast. During the past few weeks, when every hon. Member has been receiving representations from those professionally involved in training and from those who might be affected, word has come to me again and again to the effect that the Government intend to retain only four of the existing 24 boards.
  Whatever the figure may be, the Government have not adduced any arguments or evidence to justify the wholesale abolition of statutory industrial training boards. Nor has the Secretary of State—either today or on any other occasion—given any evaluation of the effect of doing so on the quantity and quality of training. There is no evidence to show that such a drastic and dramatic change of policy has been preceded by consultations with the MSC, with the boards, with the TUC, the CBI, or anyone else. There has been no attempt to encourage public discussion.
  Until this afternoon we had had only the bold statement that was made on 26 November, and which was echoed in the other place on 10 December. So far, we have had no indication of which might be the "few key sectors" for which statutory boards might be retained. In addition, no light has been cast on the nature of those wider training objectives that the Secretary of State says, might justify the retention of those boards.
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  What a slap in the face for those industries that are not on the chosen list. Perhaps for the first time, they will shortly learn that the Government do not regard them as key sectors. Are civil aviation, steel, potteries, the glass industry, wool textiles, cotton textiles, and the man-made fibre industry, to be told that they are not key sectors? Perhaps the Secretary of State or the Minister will tell us. In Committee, we shall continue to press until the Government give some indication of what those key sectors are.
  The Secretary of State says that the question of which boards are to survive will depend on the outcome of the review that he has asked the MSC to carry out. As I pointed out, and as the right hon. Gentleman has acknowledged, we have already had a MSC review, namely, "Outlook on Training". It demolishes the whole purpose of clause 1. One of the explicit purposes of clause 1 is to enable the Secretary of State to override and disregard the views of the MSC.
  Mr. Needham: The right hon. Gentleman has been kind enough to ask us to read "Outlook on Training". I am sure that he will accept that in paragraphs 9.7 and 9.8 the commission comes up with matters of major concern about the relationship between the MSC and the training boards, and the methods of funding. Those paragraphs show that the existing relationship needs to be altered. With respect to the right hon. Gentleman, he cannot say that everything in the garden is fine and rosy and that there are no fundamental criticisms in "Outlook on Training".
  Mr. Walker: With respect to the hon. Gentleman, I do not think that I have said anything that would suggest that everything in the garden is rosy and lovely and that a case cannot be made for a touch on the tiller, and an adjustment here or a variation of scope there. I readily acknowledge that such adjustments have gone on since the 1964 Act came into being. The Secretary of State already has powers to vary the scope of a board or to terminate its existence. However, the Government should have regard to the recommendations of a body that was established by the Conservative Party in 1973. The MSC was established as the authoritative voice.
  The Secretary of State seeks powers to disregard, overrule and override that commission. The powers already exist but are subject to proper constraints. Furthermore, the Secretary of State has pre-empted any such review by saying in advance that he will, as far as possible, get rid of the boards. He will not wait for the outcome of the review. The right hon. Gentleman said that there is to be reliance on voluntary arrangements.
  Lord Scanlon, chairman of the engineering industry training board—who has a lifetime's experience in such matters—said:
  "The main drawback of voluntarism is that inevitably there are too few volunteers. History has proved that voluntarism does not work, and moreover, it has worked nowhere in Western Europe."—[Official Report, House of Lords, 10 December 1980; Vol. 415 c. 730.]
  Lord Scanlon is right. History and evidence are overwhelmingly on his side. If the voluntary system had worked, there would never have been any need for the 1964 Act. His view has had many echoes in the great volume of representations that we have received in the past few weeks.
  For example, the Road Transport Industry Training Board—one of the biggest training boards—says:

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  "Following the end of the second world war, a number of voluntary systems were tried and it was the total failure of these, embodied in the creation of the Industrial Training Council, itself the logical outcome of the hopes for the voluntary principle over the previous 15 years, which led inexorably to the move towards public involvement represented by the Conservative Government's Industrial Training Act 1964.
  Most other Western industrialised countries are pursuing greater, rather than lesser, public involvement in industrial training and both current evidence and historical experience suggest that without industrial training boards, many company training departments and training officers in this country would disappear."
  That is not an isolated view. It is apparently shared by all the boards. The House should be told—it would have been much better if the House had been told by the Secretary of State rather than by me—that on 21 January the chairmen of 23 out of the 24 boards signed a letter to the Secretary of State in which they said:
  "A substantial majority of Chairmen expressed surprise and disappointment"—
  Of course, the right hon. Gentleman knows the content of the letter, but perhaps he will be sufficiently polite to allow me to tell hon. Members what is in the letter because they will be interested.
  The chairmen, in their letter, said:
  "A substantial majority of Chairmen expressed surprise and disappointment that the key recommendations of the Review Body… will not be fully implemented and that some or even most of the industries concerned will have to rely on voluntarism with regard to their future training needs.
  With one exception, it is the unanimous conviction of ITB Chairmen that this will be a retrogade step and place their industries in the unfortunate positions they were prior to the 1964 Act. Whilst many reputable firms will continue training, many others will make no such effort and resort to the previous practice of 'poaching' their trained requirements from the more responsible firms. We strongly urge you to reconsider your proposal for voluntarism.".
  If the right hon. Gentleman were being fair and straightforward with the House, he would have told us that this afternoon instead of leaving it to me. This is not the pleading of well-paid executives anxious to preserve their security. It is the collective view of men with an enormous wealth of industrial experience, many of them former employers, company directors or senior executives from both sides of industry, all of whom give time to their boards out of all proportion to any remuneration that they might receive, all of them doing difficult and demanding jobs primarily because they are concerned about industry's training and manpower needs.
  I understand that the one exception, the odd chairman out of the 24, who did not sign, declined to do so only because the letter was not sufficiently strongly worded.
  The Secretary of State seems completely unmoved by the fears of people who know something about training, are directly involved and have experience. They are not farmers, barristers and solicitors; they are men who have worked in industry throughout their working lives. Yet the Secretary of State treats their views with the same contempt as he apparently has for the views of the Manpower Services Commission.
  To whom does the Secretary of State listen? Whose advice is he prepared to accept? Or does he think that he knows best? This afternoon the right hon. Gentleman talked about uncertainty. Who caused this uncertainty throughout industry? Who caused uncertainty in the minds of all those concerned with training, whose jobs are in jeopardy and who do not know what the future holds until
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  the Secretary of State has decided where his axe will fall? How dare the right hon. Gentleman talk about uncertainty in these matters?
  During the past 20 years or so, the wide range of matters for which the Secretary of State has responsibility has generated much legislation—some of it as controversial as any that has ever come before the House. Yet, from time to time his Department has put before us a measure which has commanded support from both sides of the House and has been welcomed by both sides of industry and commerce as necessary and long overdue. My hon. Friend the Member for Newton (Mr. Evans) reminded us that never was that more true than with the Industrial Training Act 1964. Probably few Acts had a longer gestation since, during the preceding post-war period, every voluntary alternative was tried and found wanting.
  I shall not weary the House with any account of those repeated but totally abortive attempts to solve our manpower problems by reliance on marget forces. For those who are interested, they are well described in detail by Dr. P. J. C. Perry in his work "The Evolution of British Manpower Policy." But the mood that led to the 1964 Act was well summed up in the White Paper that preceded it. Under the heading "The Case for Action", it said:
  "A serious weakness in our present arrangements is that the amount and quality of training are left to the unco-ordinated decisions of a large number of individual firms. These may lack the necessary economic incentive to invest in training people who, once trained, may leave them for other jobs. While the benefits of training are shared by all, the cost is borne only by those firms which decide to undertake training for themselves."
  The Conservative Minister responsible for that White Paper, whom I have quoted in the House in other respects and for whose wisdom the House should have regard, was John Hare, now Lord Blakenham. In the month preceding the Second Reading of the 1964 Bill, as it was, he said:
  "We must all realise the extent to which sound economic growth depends upon the use of our most valuable natural assets—manpower. Yet the truth is that far too many employers give little thought to the question of developing the potential of those they employ. Many provide no training at all; many provide training only of a most perfunctory kind; and many forget the important part which further education can—and should—play in the training of young people … We can only guess how much the country as a whole has suffered because men and women at all levels in industry and commerce are not properly trained."
  The then right hon. Gentleman went on to say:
  ."few industries have developed any means of ensuring that they get the number of trained people that they need; there is no way of ensuring that all employers play their part; there has been little control of the quality of training; and there have been few attempts to examine in a criticial but constructive way methods and customs of training which have been in operation for several generations."
  Those words are a thumbnail sketch of the scene that made the 1964 Act necessary—a scene that the Secretary of State seems determined to recreate. They are a description of the voluntarism which we turned our backs on 16 years ago and which has been increasingly rejected by most other Western European countries in recent years but which the Secretary of State and his colleagues apparently now espouse. They want to revert to what Lord Scanlon in the House of Lords called "a chaotic state of affairs" such as existed before 1964.
  I readily concede that some of the high hopes and ambitions of 1964—some of them perhaps unrealistically high—remain unfulfilled; but there is no doubt whatsoever that the Act has had a wholly beneficial influence. It has created and produced widespread improvements in

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  training, it has created better standards and it has led to the development of a professional training expertise throughout industry.
  It was Lord Carr who, when Secretary of State for Employment, speaking about the ITBs, said:
  "The boards have great achievements to their credit in changing the attitudes of industry to training".—[Official Report, 1 February 1972; Vol. 830, c. 250.]
  Not the least of the benefits is that boards, by bringing both sides of industry into a forum where there is a feeling of community of interest rather than of conflict, make a positive contribution to improved industrial relations.
  I suspect that if there is a weakness in the present arrangements, perhaps the fault lies not so much with the Act as with the way in which we have applied it over the years.
  The essential principle of the 1964 Act was that of stick and carrot. The levy was the stick, and those who failed to carry out their training obligations were penalised by forfeiture of their levy payment. The carrot was the grant that was to be paid to those employers who did their duty and trained. Perhaps the carrot should have been slightly larger and perhaps the stick should have been applied rather more firmly. Unfortunately, any chance of doing that was frustrated by the 1973 Act, which led us in the opposite direction and diluted the spirit of the 1964 Act with its ceiling on levy, its exemption provisions and the wider exemptions that it provided for small businesses.
  In so far as it will be relevant after the right hon. Gentleman has finished butchering the boards, clause 2 represents a further weakening of the role of the ITBs. The Department of Employment press notice that covers the Bill suggests that clause 2 is
  "to enable an industrial training board to finance its operating expenses by a levy on employers".
  It is a statement that is coy in the extreme about the fact that the Government are retaining the 1 per cent. ceiling on levy. That is not mentioned in the press release. The upper limit that was introduced by the 1973 Act, to the dismay of the boards that had previously required a higher levy to fulfil their wider purposes, was offset by the Government's undertaking to pay the boards' operating costs. However, the Government are now clawing back the cash that was allocated to meet the boards' administrative costs—the £50 million has been referred to—and they have reneged on their commitment. Furthermore, the Government will deny, at least to some of the boards, the authority to recoup those losses.
  I refer to the Engineering Industry Training Board as an example. I have not discussed the issue with it, and I do not know what its position will be. Presumably, it will be a prime candidate for survival when the right hon. Gentleman wields his axe. If it is not, I do not know which of the boards will come into that category.
  Prior to the 1973 Act the EITB had a levy in excess of 1 per cent. When the Bill was before the House its levy was 2 per cent., and I believe that it had been historically higher. On the assumption that the board's activities have remained constant and that a levy of 2 per cent. would still be relevant, to peg the levy to 1 per cent. would be to cut the board's activities by a half. That will be the position unless the right hon. Gentleman has already assured the board's chairman, Lord Scanlon, of his willingness to bring a 2 per cent. levy order before the House. If he is not prepared to do so, the Bill will have a crippling effect
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  on the board and on all the training that it seeks to carry out. Doubtless, it will have an equally crippling effect on the other boards.
  Mr. John Evans: There is a deafening silence at the moment.
  Mr. Walker: Indeed. I have no objection to the Government cutting their obligation to fund the boards' operating costs. I thought that it was a foolish undertaking in the first place, and I have seen since the problems that it caused, not least those to which the right hon. Gentleman referred fleetingly—namely, the friction between the staffs of the boards and their employers. The logic of severing the link and withdrawing the funding of the cost of the boards is to restore to the boards their former freedom for levy orders. That logic was recognised by the MSC's review body, which recommended that the funding of operating costs should be returned to industry and that the boards should no longer have to obtain Government approval of the terms and conditions of employment of their staffs. However, it recommended that there should be no statutory limit on the size of the levy.
  The right hon. Gentleman cannot pluck out of a package of proposals that hangs together those pieces that suit his purpose and reject the others. We opposed the introduction of the ceiling on levy in 1973. If we felt justified in doing so then, we shall be doubly justified in opposing its retention now.
  Despite having said that we shall not oppose the return to industry of the funding of the boards' operating costs, I must make it clear to the right hon. Gentleman that we are totally hostile to the idea that the Government should pocket the savings. I want to encourage the House to share that belief with me. The money should continue to be available to support the work of the boards but without the strings imposed by the 1973 Act. To do otherwise would be for the Government to impose yet another substantial cut in public support for training.
  The full extent of the cuts cannot be quantified in the absence of the MSC's corporate plan. However, they are sufficient for the chairman of the commission, Sir Richard O'Brien, publicly to express the fear that even the present level of support is insufficient to sustain apprentice intakes at an adequate level in future.
  However, we know from this month's Employment Gazette that Government spending on training is to suffer yet another cut of £77·5 million over the next five years. That will include a further cut of £35 million in the money allocated to the training opportunities programme. During the general election campaign the right hon. Gentleman pledged over and over again—it was almost interminable—his party's support for industrial training. He said repeatedly that it was the Conservative Party's approach
  "to retrain those whose skills are no longer needed."
  In 1977–78 nearly 100,000 completed TOP courses. The figures in the Employment Gazette published this month suggest that by 1984 the Secretary of State will have managed to cut that figure to about 55,000. He will have reduced the number retraining by about a half. How does he reconcile that with his party's commitment to retrain those whose skills are no longer needed? He has talked this afternoon about people having to retrain and retrain. He has spoken of not one skill, not two skills but three skills in one lifetime. However, at the same time he is busily depriving people of the opportunity to do so.

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  On 16 March 1979 the right hon. Gentleman said:
  "People must be trained in a spirit of optimism, secure in the knowledge that they are gaining the right skills and being educated to participation in the changes, not to be overwhelmed by them."
  That was good heady stuff in the atmosphere at the hustings. What has happened? At that time, the number of apprenticeships supported by Government funds was only 37,000. Within a year of taking office, he had managed to reduce it to less than 21,000. Last year total apprentice recruitment fell by about 10,000. It was reduced by about 10 per cent. of industry's recent annual apprentice intake.
  I use as an example the engineering industry and the firms within the scope of the EITB. The apprentice intake fell from 22,900 in 1979 to 20,700 in 1980. Other manufacturing industries all reported reduced intakes and some were substantial. The reduction in furnishing and timber was 50 per cent. It was cut by half in printing and publication. It was reduced by 25 per cent. in food, drink and tobacco. As the TUC observed in its economic review, at the same time the skill level of our workforce is being diluted as redundant workers take any job that they can get. It is hardly surprising that the MSC admits in its corporate plan to being "exceedingly uneasy" about the policies being imposed upon it by the Secretary of State. That was its view before the Bill was published.
  Of course training costs money. However, in the long run, it will cost us very much more if we have not trained. How can we inprove our productivity if we do not invest in the skills and techniques that are needed to match the challenges that are before us?
  The Bill is a part of the Government's continuing retreat from the manpower policies that are essential if we are to give hope and opportunity to our people, especially our young people, and win through against the challenges of international competition and advanced technology.
  The Government should accept the wise advice they have been offered by the MSC's review body. The right approach is not to cast aside the present arrangements, but to build on them. Instead the Secretary of State has chosen to reject that advice and to acquiesce to the demands of the Tory Party's Centre for Policy Studies. To whom is the Secretary of State listening? Where does he go to get his advice?
  The most categorical statement on the subject has been made by the Prime Minister's poodle at 32 Smith Square, the Tory Party's Centre for Policy Studies. That is the true origin of the Bill. The Department of Employment and the Manpower Services Commission are the hapless fall guys. In short, the Bill has been dropped on industry straight out of the bowels of the Conservative Party. I shall ask by right hon. and hon. Friends to pull the chain on it.
  5.20 pm
  Mr. Jim Lester: The right hon. Member for Doncaster (Mr. Walker) gave the wrong address for the Centre for Policy Studies and he got the whole intention of the Bill equally wrong. He spoke about the uncertainty of the training boards, but the review that has been taking place for the past two years was set up by him. It is right that those who work in training boards should have their future settled as soon as possible. That is what my right hon. Friend is trying to do.
  My right hon. Friend spoke seriously about the importance of training. There is no disagreement in the
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  House about that. Equally we all share the frustration arising from the efforts made so far in this country to match our competitors in the search for improvements and matching training needs to industrial needs. I also share the feeling of Lord Scanlon who said in another place that we do not have unlimited time to get the matter right. He suggested, in his maiden speech, that we have 10 to 15 years to get our training linked to industrial performance if we are to achieve the sort of results that this country needs. The time has never been better or the need greater. That the need has never been greater has been reinforced in many areas because of the level of unemployment, particularly among the young.
  Lack of skill is one of the major factors to those young people who seek employment. Secondly, there have been changes within our industrial structure, and family men, who, having worked in one area and gained one skill, find, perhaps for the first time, that it is no longer required. As the recession ends we shall have demands from industry for a skilled work force.
  The time has never been better, because over the past two years there has been an enormous amount of research, and many reports, into this whole subject. They include the review of the Employment and Training Act report, the result of which we are debating, the Finniston Report, on which we have made progress, "A Better Start to Working Life", which has resulted in the Macfarlane report and farsighted suggestions for the potential for 16 to 19-year-olds and their education, the Government's decision to expand the unified vocational preparation in which industrial training boards have been closely involved, the TOPS and the achievement of TOPS and the review of skillcentres to put them on a more sensible regional basis. There is also my right hon. Friend's interest in distance learning and the open tech principle and their urgent development. But, perhaps more than anything, there is the development and growth of the youth opportunities programme in the past two years and the resources devoted to that.
  The aim of all that is accepted throughout the House. Everyone entering the labour market should receive realistic help on his occupation or vocation. We should develop all possible means of doing that. Secondly, during people's working lives the chance must be given—the ladder must be there—for them to increase their skills or change their knowledge at any stage and by whatever means. The range of methods of doing that needs developing.
  One essential key to those objectives must be developed. We need a widespread system of certification related to skills and standards rather than to occupation or time. Training boards have played, and will need to play in the future, a vital role in that.
  We should not judge the Bill as a negative quango hunt. The stakes are far too high. Nor should it be seen in isolation. Few people inside or outside the House, see it in the Machiavellian light in which the right hon. Member for Doncaster sees it.
  There is a danger that the review—particularly concerning the transfer of costs—is taking place at a most difficult time in industry. It is a time of falling profits, higher charges and the transfer scheme for sick pay. I know that my right hon. Friend the Secretary of State recognises that it is important that we should understand the position of industry over the transfer of costs. It would

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  be tragic if a proper review were jaundiced by that element and if it were thought that, if it costs anything, we do not want it.
  Of course it is right to transfer the administrative costs and to ensure that Government money is expended on the training element and expanding that with industry. There is no question but that the transfer of costs is essential. It is unfortunate that the position of training boards relative to their industries has declined since the Government took over the costs of administration. The boards have increasingly been seen as an arm of government and the Manpower Services Commission as an integral part of their own industries. I can support the view that the time and energy which has been spent by the Government, the Civil Service Department and the chairmen and staff of ITBs in trying to reconcile the irreconcilable over staff and salary costs and in trying to link them in to Government as extra-Government bodies has been a complete waste of time.
  There is no doubt that the costs of the boards should be returned to their industries. However, I have sympathy over the time scale. I am grateful for my right hon. Friend's suggestion that he wants to achieve the change by a commencement order. It would be helpful for the purposes of the review if that could be clarified more and if my right hon. Friend could tell us that the commencement order would mean that the costs would be transferred over a period of one or two years, or three years as the TUC has suggested. If that element could be cleared away we should have a calmer atmosphere in which the review could achieve its work.
  A sectoral review will achieve much. There is great scope for change over the 24 boards. There is scope for amalgamation, federation and for some boards to go voluntary. There is also scope for extension of statutory responsibility, perhaps, in the areas of telematics and computers. It is essential to maintain a network of sectoral training but to free it from the narrow confines of the past. As a result of the review, it is important that the costs of training should continue to be fairly shared.
  When my hon. Friend replies, I hope that he will confirm to the House that the review will be seen with an open mind, that the pattern that emerges from the review has not been pre-decided and that it is not known by the House. We are anxious that it should be right. It is right that the Bill should be passed and that we should be prepared to take action. But there will be no great hurry after that. I hope that any proposed changes will be genuine, practical, long-sighted and on grounds that can be justified. One should remember that within the ITBs the staff have a great deal of industrial expertise in working with schools, in unified vocational preparation, in industry, careers and further education. If we can have an assurance that it is a genuine review and that there is no preset formula for the end of it, we shall await the outcome with interest.
  In parallel with the review, I should like my right hon. Friend to liaise with the Secretary of State for Education and Science. Much good work has already been done between the Departments. It is essential that the Department of Employment should work with the Department of Education and Science to link the disparate strands of education, work preparation and training. Much good work has been done and I recommend to those who
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  read the reports that emanate from the hard work of various hon. Members the Macfarlane report on education for 16 to 19-year-olds. Paragraph 63, which covers the training agencies, provides a basis for working together with the Department of Education.
  I wish to make one other suggestion for consideration. The principal problem with training boards is that they have been sectoral and vertical while the labour market is increasingly regional and horizontal. Mobility in this country is a deep-seated problem, for a variety of reasons that we all understand, and it is likely to get worse. Natural labour markets are much more identifiable in small areas.
  Almost by accident, good things happen and, because of the pressure of unemployment among young people, the MSC has developed the special programmes division. As part of that, it has developed area boards which are flexible and which involve employers, trade unionists, educationists and local authorities.
  Originally, their purpose was social and they have been working to make sure that young people get some vocational training and, particularly, work experience as an alternative to unemployment. However, as the numbers have increased, the training element has increased and that should be continued. The CBI recognises that that is in its interests. It set up a committee to get additional places for work experience within the YOP.
  I should like my right hon. Friend the Secretary of State to consider amalgamating the training services division with the special programmes division to cover the whole area, involving, even before the end of the review, the industrial training boards that are most relevant to local areas. As I have seen in my travels throughout the country, the boards could be a great help to the YOP and the development of unified vocational preparation. They have great knowledge of modules, links with industry and assessments of young people.
  It was interesting for me to see in training workshops throughout the country the number of young people being trained under the YOP to use sewing machines. The knitwear training board has developed a system of assessing the aptitude of young people. Within half an hour it is possible to tell whether a young person is likely to get a job after training. Those schemes have not been put together and that is a simple example of the sort of help that industrial training boards could provide.
  That formula would help us to develop a non-bureaucratic and locally inspired and motivated total coverage of the training package. It would cover the young unemployed and the young employed and the training of adults in and out of work. It would use all the means at the disposal of a local area, whether group training schemes, colleges of further education, employers' premises, skillcentres or whatever.
  I am sure that local industrialists and trade unionists, who have already contributed a great deal to the area boards in relation to their social responsibilities, would see them in a different light if they were also responsible for training needs and bringing together schools, facilities and people in terms of employment as well as unemployment. It may be a radical suggestion, but I am sure that it would work within the 10-year time scale that we all believe is essential.
  I am what is known as a "One-Nation" Tory. On training we have many common objectives. We have a bridge and a common interest with the trade union movement, which gave evidence packed with common

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  sense to the review of the Employment and Training Act—RETA—and employers who have a vested interest in the proper utilisation of the skills of the nation in developing our future.
  I beg my right hon. Friend the Secretary of State and the Under Secretaries who have been pitched into handling the Bill and who, I am sure, have the qualities necessary to deal with it, to see the bridge not as something which should, as Labour Members suggest, be made to smoulder and burn but as something which we can widen to provide real prospects for the future.
  5.35 pm
  Mr. Ken Eastham: The Secretary of State made an unconvincing case which was thin in content and conviction. The Conservatives are a party of many contradictions. They tell us that we must export more, but at the same time the Government are taking away some of the tools that would allow us to do the job.
  We may not be rich in raw materials, but we could be rich in expertise and high skills, and it is with those skills and high technology, rather than with our raw materials, that we will win the day. If we are to be successful, it is essential that we have the tools to do the job, and those tools include investment in the people who will carry out the necessary work to enable us to sell on foreign markets.
  Various countries in Europe assess the value of training in different ways. The Secretary of State made a brief reference to the Federal Republic of Germany. An EEC information sheet published in April 1980 said that Germany has probably the most comprehensive training system. It added:
  "Vocational training is concentrated on maintaining an adequate supply of places for people who wish to train for skilled occupations. Overall training picture bright. In 1978–79 the supply of training places was around 660,000. For the first time since 1974 training places were in surplus in 1979–80."
  That is an indication of the importance that one of our biggest competitors attaches to training.
  There have already been references to the fact that our work force must be prepared to retrain perhaps two or three times in a working lifetime. It is dangerous to leave that work to some form of voluntarism.
  I am especially concerned about some multinational companies which come here to invest money and use some of our skills. I am not optimistic that they are prepared to spend money on training. They will come and go as they wish, but we have greater responsibilities. Some multinational companies do not show as much loyalty to this nation as they do to international high finance.
  Before the training boards were introduced there was virtually no training in some industries. Training was almost unknown in the catering industry. The building industry, a most unstable industry, has consistently made poor provision for skills. As a consequence, at times a boom, firms poached from one another and the industry got into a terrible mess.
  In times of slump, there is virtually no training. It is only at times of great need that a shout goes up from industrialists and from Governments that something has to be done. By that time, of course, it is too late. Training should not simply begin when people are out of a job. It should be continuous. It should be concentrated directly in the areas where the nation knows it has specific needs.
  Another area of serious consideration is the partnership with education authorities. The authorities need to make
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  their provision in advance. They need to make staffing appointments. This cannot be done at the drop of a cap. The organisation of staffing within further education colleges is essential. The colleges need to know positively what will be the situation in order to make their training arrangements. The same consideration applies to ordering equipment. Those undertaking specialist courses of training need certain equipment. This must be ordered in advance.
  A meeting of principals of some of the further education colleges took place recently in Manchester. Some of the possible consequences of the Bill were discussed. I should like to refer to a letter sent to me only last week. The principals make the point that it would be wrong to leave everything to the initiative of individual firms. The letter states:
  "This is particularly so because many of the smaller ones lack the resources of staff and expertise to mount proper training schemes, while many of the very large companies are now run on a multi-national basis and really do not give priority to our own national needs. The result, therefore, is that many people find themselves working for firms who do not have the right priorities or attitude for training, which is why the levy grant system is a valuable way of ensuring proper training."
  Other points included doubts about the responsibility for initiating proper training schemes if ITBs are abolished. The principals make a strong plea that if the Government intend to withdraw their financial support for ITBs
  "they should recognise that the Further Education Colleges will need more and therefore the Rate Support Grant to authorities which are responsible for them must reflect that".
  The point the principals make is that it would be wrong to assume that all Government financial support can be withdrawn from the ITBs without the need to increase public spending on education. Those are some of the observations of professional people involved in education and training.
  Everyone can agree that we are in a serious state of industrial decline. The Bill will have a serious effect particularly on the inner areas of major cities where there is high unemployment. It is essential that we prepare and train our people for the jobs of the future. Money spent in this direction is not a financial drain. It is a positive investment. It is better than money in the bank.
  If the Bill is given a Second Reading tonight, it will be yet another nail in the coffin of British industry. In spite of the Secretary of State's remarks about new training initiatives, I do not believe that the right hon. Gentleman has said anything new. I get the distinct feeling that this is something old. Indeed, it is very old. It is so old that it is beginning to smell.
  5.45 pm
  Mr. Nicholas Scott: Until he came to his conclusion, I thought that the hon. Member for Manchester, Blackley (Mr. Eastham) had made a number of points in a sober and responsible manner about industrial training. The real contrast so far in this debate has been the well-informed, knowledgeable contribution of my hon. Friend the Member for Beeston (Mr. Lester), who has made such a notable contribution to work in this field over the past 20 months, and the hysterical denunciation of the Bill by the right hon. Member for Doncaster (Mr. Walker) who made no positive proposals and did little good to anyone except possibly to raise his own blood pressure. I wish to do my best to find some

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  common ground in industrial training, as did my hon. Friend the Member for Beeston, to see whether we can find a sensible road forward.
  We are surely agreed that training is essential to our economic future and important to the individuals who benefit from it. We can also agree that it is a practice that is much under valued in this country by too many employers and too many people involved in industry. We have done too little compared with our international competitors. This has led to skill shortages and has contributed to our poor position in the league of industrial achievement. We can also agree that training is essentially a long-term investment. It will not produce results tomorrow. One is sowing the seed corn that will bring forward results some time in the future.
  It is worth mentioning a special problem that exists at the moment with a very high level of unemployment that is hitting disproportionately, as unemployment always does, the least skilled members of our work force. They find themselves increasingly without job opportunities. Yet we know that when the upturn in the economy comes—although increase in employment may be delayed beyond other indicators of economic upturn—we shall need new skills. Every time that the upturn has come before, we have run into bottlenecks and skill shortages. There is no reason why that should be different today. Indeed, with the rapid change in technology, it is likely to be worse this time than on previous occasions.
  We therefore need a great investment in training. That is one of the reasons why it is right that the review should be taking place. As my hon. Friend the Member for Beeston said, the review was instigated under the previous Labour Government and is now hopefully to be carried to a swift conclusion by the MSC so that my right hon. Friend can consider what action he needs to take upon it.
  There are some pluses and minuses in the present situation. On the plus side, it is true that industrial training boards have built up considerable banks of knowledge about training over a wide area. They have good access to companies at a high level. That is important. They have improved the structure of training in a number of important areas. In the engineering industry, the modular training scheme is a notable example of the improvements that have been made.
  I should like to emphasise one other point made by my hon. Friend the Member for Beeston—the fact that the training structures are an important addition to our tripartite machinery. Anything that brings together the Government, industry and the trade unions to talk about specific problems, rather than, as so often, to exchange insults, is an important contribution to our economic life.
  On the minus side, there is no doubt that many of the boards have built up bureaucratic structures whose impact has been made worse by the need to refer too many decisions to the Manpower Services Commission, then to the Department of Employment and then to the Civil Service Department. We have heard of decisions taking 18 months to return to the originator. That must be wrong.
  Mr. John Evans: The hon. Gentleman has raised an important point. Does he lay the blame on the bureaucracy of the industrial training boards, of the Manpower Services Commission or of Whitehall?
  Mr. Scott: The blame probably does not lie exclusively with any of them. We have too complicated a system, and that fact alone justifies a review of the bureaucratic procedures and my right hon. Friend's proposal to streamline them.
  One of the greatest failings in industrial training—this is not exclusively due to the industrial training boards—is that we are still largely stuck with an outdated system of craft training. The Select Committee on Employment was given evidence of an uneven quality of work as between the different boards, and perhaps a degree of inflexibility about some of them.
  There was recently drawn to my attention the experience of the British Agricultural and Garden Machinery Association. One would expect it to come under the Agricultural Training Board, but it comes under the Road Transport Industry Training Board, whose experience has nothing to do with the training necessary for those who work with agricultural and garden machinery and whose numbers are tiny compared with the total under the scope of that board. Their work is not compatible with that of the motor trade. They go out in all weathers, in appalling conditions, to work on farms, smallholdings and market gardens repairing machinery. They are not working in motor transport work shops or other workshops. That section of the industry has always run its own system of training its own employees. The board has manifestly failed to show any concern for its special needs.
  That is an example of the sort of group that could be taken out of a board's scope and allowed to make its own voluntary arrangements. Such a case—there are others—reinforces the need for the review. But I hope that when the Government conduct a review and make up their mind they will not lose the baby with the bathwater. There is a great danger in too widespread and too quick a spread of voluntarism. We do not know whether any voluntary arrangements would continue to have statutory standards applied to them. Some of the existing boards that continue will clearly go on having statutory obligations. Will the voluntary arrangements that might replace some of them also have to achieve those standards? If not, who is to monitor them to see that they achieve the necessary standards?
  I hope that my right hon. Friend will acknowledge that there is a danger and see that it is dealt with. I hope that he will also deal with the danger of a too rapid transfer to industry, particularly in the present economic climate, of the burden of the cost of industrial training.
  We know what our targets are. They are to reduce bureaucracy, improve standards, build upon the best experience that we have, ensure a training system that is flexible enough to cope with a rapidly changing future, and give the taxpayer and industry value for money. I am sure that there will be savings as a result of the review, but it must be clear to all that, with unemployment likely to face the country for a considerable time, they will not be absolute; the money will have to be spent elsewhere on manpower programmes, particularly to protect the weakest in our society from the present intolerable level of unemployment.
  My right hon. Friend outlined a number of aims that we should be concentrating on as we reform our system of industrial training. The first was vocational preparation for the young, where, as he rightly said, we are way behind the performance of our main competitors. In West

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  Germany about 90 per cent. of young people go on to some form of education or training when they finish full-time education. In France the figure is about 80 per cent. Here we are lucky if it is 10 per cent. We have a long way to go. The experience of the youth opportunities programme and of the unified vocational programme has shown what can be achieved when we set our minds to it. The vast majority of young people who have gone through those programmes have gone into full-time work at the end of them. If we are determined to list our targets, they can be hit.
  I welcome my right hon. Friend's statement that the eventual target should be to see that every school leaver has an opportunity under one or other of the schemes. But since, if we are to go on working on the present basis we need the widespread and increased co-operation of employers, I question whether a widespread and quick return to voluntarism will necessarily meet the need for expansion in this area.
  My right hon. Friend also mentioned the question of apprenticeships, which is perhaps the greatest failure of our present system of industrial training. The late and much missed Mr. Reginald Maudling used to describe living in this country as being like living on a planet with an excessively high gravitational pull, because to change anything required a disproportionate effort. The experience of trying to change the system of apprenticeships is a good example of that phenomenon. Our present system is failing both the youngsters and our economic base. It is increasingly inappropriate to the newly developing and highly technological industries upon which so much of our future prosperity depends.
  We all now accept the premise that we need to train to standards rather than simply to train by the effluxion of time. But again I have to give my right hon. Friend a warning. Today's economic pressures on employers have led to cuts in apprenticeship training and in the training of youngsters generally. Therefore, any widespread dependence upon employers to increase training in this area will have to wait until the economic climate has altered.
  The third priority that my right hon. Friend outlined was adult training and retraining. The structural change that we are experiencing, and are likely to experience for a long time, will mean that less and less can the majority look forward to acquiring one skill that will last them throughout their adult life. People will have two or three careers. In training people for new careers, in training managers and technicians, we run a long way behind our major industrial competitors.
  Much of the work will have to be done within industry. I welcome what my right hon. Friend said about new techniques, what are now called open learning techniques. I know that the technical term means the use of new techniques of micro technology, and so on, to make learning available to more and more people. But I hope that in their other sense the words "open learning" will mean that more and more people who perhaps feel themselves locked within a straitjacket of opportunity at present will be able to improve their life chances and provide themselves and their famlilies with more prosperity.
  I support the Bill. I know the commitment of my right hon. Friend and of my hon. Friend the Under-Secretary, whom I welcome to his new responsibilities. We need a better trained and more flexible work force, not just because our country should prosper as we all want, which
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  is important enough, but because the individual, if he is provided with more opportunities, will be able to realise his potential. That will lead to a more cohesive, more satisfied and more prosperous country. Like my hon. Friend, I shall watch the review with great care and great interest in the light of the future industrial training needs of the country.
  6.00 pm
  Mr. Cyril Smith: First, I express the hope that if, by tradition, Governments take little notice of points made by Opposition parties, they might at least take note of comments from their Back Benchers. I particularly hope that they will take notice of the speech of the hon. Member for Chelsea, (Mr. Scott). If some Members believed that his views were the views of the Government Front Bench, some of us might be a little less apprehensive about the Bill.
  As I listened to the Minister, I wondered why he was presenting the Bill at all. He said that it was innocuous and kind, and that there was no need for worry. At one stage he indicated that he had stirred matters up, and he said that he had not wanted to do so.
  Many hon. Members are concerned, not so much about the proposals in the Bill but about its consequences. I am concerned about some parts of the Bill, particularly clause 4. We believe that the consequence will be one of two things, and possibly both. First, a number of industrial training boards will be abolished without anything necessarily to replace them. Secondly, the Bill will transfer from the Government to industry more of the expense for training than is now borne by industry. I suggest that on either count the Bill is ill-conceived and certainly ill-timed. We are in a position where industry is struggling to survive, and yet the Bill will clobber it yet again. It will have to find finance over and above that which it is expected to find at present.
  That is strange. The Government say that they believe in free enterprise, and at the last general election they made great promises to small companies. I recall the trips to Bournemouth and the speeches that the now Minister of State, Department of Industry, made to the Council of Small Firms. He said that everything would be all right for small businesses if the Conservatives were elected. But in practice, business has been clobbered and clobbered again by this Government. Local authorities have put up rates to astronomical heights as a result of Government policy. National insurance surcharges have been levied on companies, and they are now to be asked to pay sickness benefit for their employees. This Government, who are so keen on encouraging industry and small businesses, are now adding a further burden by transferring to them the cost of financing training programmes. That is a strange way for the Government to behave, and a strange time at which to embark on such proposals.
  Mr. Needham: Does not the hon. Gentleman accept that small employers are exempt from the levy and, therefore, that the very small companies would not suffer?
  Mr. Smith: First, there is the argument about what is small, and, secondly, the matter is under review. We have no guarantee that small companies will continue to be exempt. If we are moving towards voluntary organisation rather than statutory organisation we shall have to rely on boards to exempt small industries. Small companies were

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  not exempt prior to 1973. On more than one occasion I signed cheques for levies, and I received them also. Small companies were not exempt prior to the change in circumstances, and there is no guarantee that they will be exempt in the future.
  I do not deny—indeed, I subscribe to the view—that some industrial training boards are grossly over-administered and that some have provided jobs for the boys in glorious fashion. Some have built up sizeable assets and resources and some have as members people who have not been close to industry, in a practical sense, for years. That demonstrates a need for review, and not a need for abolition, which many hon. Members believe will be the consequence of the Bill.
  Equally, many training boards have an excellent record. Before this Government came into office my constituency was largely a textile constituency. Therefore, no one will be surprised if I take that industry as an illustration of my point. The Cotton and Allied Textiles Board has, to my certain knowledge, been of great help to many companies, including many small companies. To destroy organisations such as that—it appears that textile boards are likely to get the chop—would be one more retrograde step and a public demonstration of the view that many people hold that the Government have written off the textile industry.
  I said that the Bill was ill-conceived and ill-timed. We are a nation in which the Labour Government put 1½ million people on the dole. A further 1 million have now been added by this Government. It is obvious that the Government are striving desperately to equal the record of the Labour Government and thereby ensure that by the end of the year there are about 3 million people on the dole. The net consequence of mass unemployment should indicate a necessity for more training and retraining, rather than less. Whatever one's view about the way in which unemployment has arisen, because it exists this should be a time for training and more training. What are the Government doing about that? I thought that the speech of the right hon. Member for Doncaster (Mr. Walker) was superb and extremely well-researched. He indicated where the Government had reduced the facilities and opportunities for training.
  In my constituency, where unemployment is now officially running at almost 14 per cent. but where we know that, unofficially, the figure is between 16 per cent. and 18 per cent.—and I am not including married women; I have in mind mills where closures have been announced but where redundancies have not yet taken place and are therefore not included in the figure—we have a Government skillcentre. But what have the Government done to encourage such companies as remain in Rochdale to send their employees to the skillcentre this year? They have increased by substantial amounts the fees that those companies have to pay to send people for retraining.
  I must be fair to the Under-Secretary of State, the hon. Member for City of Chester (Mr. Morrison). He has written to me in the past seven days saying that he is considering this matter and the representations that I have made to him. I hope very much that he will arrive at a conclusion that is favourable to my constituency, so I must say nothing likely to prejudice him in doing so.
  Skillcentres in areas of high unemployment should be encouraged to do more training. Companies that are going
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  through periods of deep recession and serious economic problems are not encouraged to send people to attend skillcentres if the fees are increased. That encouragement will come about either by cancelling the fees altogether or by retaining them at their present level.
  In terms of training and retraining, on top of all that we have a changing economy and a changing future. I refer to the microchip and all the other technological advances that are being made at present. I have said many times, and I make no apology for saying again, that sooner or later some Government will have to have the moral courage to say that we need to restructure the pattern of life as between employment, vacation and leisure. The time is coming when unemployment will have to cease being a party political football and we shall all have to accept that our labour force, if it works 40 hours a week for as many weeks a year as it does at present, until men are 65 and women are 60, is greater than our economic requirement as a nation.
  The consequences of saying that are many. I have in mind the gradual reduction of the retiring age for men and the restructuring of our training facilities and opportunities. I subscribe very strongly to the view expressed by the Secretary of State about the need to get away from the idea that a person becomes skilled only if he is under the age of 20. We ought to have standards capable of being achieved at any age; anyone who acquires them is a skilled man, because he has done exactly the same training as people between 16 and 20 are now doing. A change in the age of training and the opportunity to train and retrain later in life are two essentials. We also need shorter working weeks. These are all consequences of accepting that we have a labour force surplus to requirements.
  I hope that the day is not far off when some Government will have the courage to say "That is the position. Now let us sit down and work out the consequences of it." One of the consequences of it must be training and retraining. That is why at this stage it is idiotic to start proceeding along lines that will reduce the existing number of industrial training boards.
  I turn finally to the clause to which, in passing, I referred earlier. Clause 4 gives exemption to companies in enterprise zones. In my view, that clause in itself is sufficient to warrant voting against the Bill. It is a disgraceful provision, and I am staggered that any Government should have the impudence to include it in a Bill of this description. The clause is saying to people who employ apprentices, including my own company, "You do the training, and let companies in enterprise zones take them over and use them." That was the position before we had compulsory industrial training, and that position is being encouraged by clause 4 yet again.
  First, let us consider what is to go into the enterprise zones. I suspect that many right hon. and hon. Members have no idea what is likely to be included in enterprise zones. Great supermarkets are qualified, as are architects' offices, engineers' offices, solicitors' offices and commercial organisations. All are qualified to go into enterprise zones.
  Mr. Clement Freud: Betting shops.
  Mr. Smith: As my hon. Friend says, even betting shops will be permitted. All of them can go into enterprise zones and get the benefits of them. However, that is water under the bridge. The Government have decided that such

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  bodies may go in and, although many of us believe that that is not the spirit in which enterprise zones were envisaged, it has happened, and that is it.
  Under clause 4, however, all those organisations, be they shops, offices, manufacturing industries or anything else, will now be exempt from any levies for training and from any requirement even to provide statistics about the training that they are doing. In future we shall not be in a position to question or discover what is going on. We shall not be able to say that the law on this matter needs changing. All companies in enterprise zones are to be exempted under the clause.
  A company competes in the same market as a second company across the way, which is in an enterprise zone. The company across the road, because it is in the enterprise zone, will get tax and rate concessions, planning reliefs and Governmant grant. On top of all that, when, as a consequence of the Bill, some industries, including the one on this side of the street, have an additional levy put on them for training, the company across the road in the enterprise zone is required to pay no levy at all. The clause is a scandal, and it itself merits a vote against the Second Reading of the Bill.
  I believe that the Bill is ill-timed. I do not believe that it is innocuous, as the Secretary of State would have right hon. and hon. Members think. It is ill-conceived. I agree that there is a need to review the training boards, their function and their administration, and generally to see what can be done to streamline them so that they can prepare for the next decade. In the end, the country needs more training and retraining, and not less. If this Bill is given a Second Reading, the consequence is likely to be less training and retraining, and not more. For all those reasons, my colleagues and I will vote against the Second Reading.
  6.20 pm
  Mr. Robert Taylor: It is a pleasure to follow the robust contributions of the hon. Member for Rochdale (Mr. Smith), who speaks from a depth of personal experience in industry. I share his reservation about clause 4, as I do not believe that it is right that those within enterprise zones should be released from the payment of levies that are paid by other companies. However, that does not merit our voting against the Bill tonight.
  I do not agree with other remarks made by the hon. Member, particularly his argument that all training boards should be sacrosanct and that none should be closed down. Nor do I believe that, as a result of the Bill, there is likely to be less training in the future.
  I have always believed that any party that has been in office continuously for 10 years or more must run out of ideas. It tends to grope around in order to find legislation to produce before the House. The Industrial Training Act 1964 was such an Act, coming at the end of 13 years of Tory Administration. It was meant to help industry, but it was ill-thought-out, and it placed an administrative and financial burden on industry, and particularly on small firms.
  When I first entered the House after the 1970 election, I joined my hon. Friend the Member for Shipley (Mr. Fox) and my right hon. Friend the Member for Gloucester (Mrs. Oppenheim) in starting a campaign to change the levy grant principle as it was then operated. We tabled prayers against the training levies and questions to the Minister,
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  and kept up a barrage of activity on the subject. As a result of that activity, we played a small part in the birth of the Employment and Training Act 1973. That Act was a typical example of compromise, which was the hallmark of successive Governments over the 1960s and 1970s.
  Because part of that Act retained the levy grant system, I concluded my speech on Second Reading on 13 March 1973 by expressing grave reservations. The Government of 1973 took a step backwards from the plan for discussion that was produced in 1972, when my hon. Friend the Member for Howden (Sir P. Bryan) was the Minister responsible at the Department. Page 55 of the discussion document said:
  "A policy by a firm of maximising its grant return can therefore lead to distortion of the training that it really needs to undertake."
  I accepted that part of the document. I do not believe that the hon. Member for Rochdale would dissent.
  I repeatedly tried to put that point of view in Committee on the 1973 measure, but I did not receive much support. However, as long ago as 1966–67 the Estimates Committee, under the chairmanship of Mr. Hamling, the late Member for Woolwich, West, who was a respected educationist, came to a similar conclusion following evidence from a substantial company that it had changed its trading policy in order to maximise its grant but not in a manner in which the board had complete confidence. In 1966–67 the Estimates Committee forecast the abandonment of the levy grant system. The Bill takes us one step nearer, but it again falls short of the objective that I should like to see.
  That objective would be the handing over of the industrial training boards to the industries that they try to support, complete with the assets that they have built up and to which the hon. Member for Rochdale referred but without the statutory right to levy. They would, however, have the right to charge fees for the services that they provide.
  I do not know why my right hon. Friend the Secretary of State has moved in the direction that I should like to see. Perhaps it was because, about two months ago, the Daily Mail produced a substantial article showing that the director of the Road Transport Industry Training Board had an inflation-proof salary which was already over £28,000. If such cases do not encourage right hon. and hon. Members on the Opposition Benches to the view that an overhaul of training boards is distinctly necessary I do not know what will.
  Whatever the reasons, opposition will be mounted against the Government's proposals. At the beginning of his speech the right hon. Member for Doncaster (Mr. Walker) lifted up a pile of papers that he had received protesting about those proposals. It would be extraordinary if, after 16 years of the existence of the training boards, hon. Members were not bombarded by those who wanted to preserve the status quo. It would be extraordinary if after 16 years, arguments could not be put forward to justify the retention of the present situation. However, in the main those choruses come from those who are employed by or connected with the industrial training boards.
  The right hon Member for Doncaster implored my right hon. Friend the Secretary of State to take notice of those protests that had come from those who were "professionally concerned" with the existence of the training boards. He went on to implore the Secretary of

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  State to listen, not to those who are barristers, professional men or farmers but to those who speak for industry. I suggest that those who speak for industry do not support the continuation of the boards as they are now organised.
  One argument that is frequently put forward—my hon. Friend the Member for Chelsea (Mr. Scott) mentioned it tonight—is that we must be ready for the upturn in the economy when it comes. Of course we must. The engineering industry is a case in point.
  In my constituency a firm called Waddon Engineering has just introduced a new motor cycle. It was launched with substantial press coverage, during January. That firm has an apprenticeship scheme. Therefore, it does its own training to a certain extent. However, because of the upturn in its business it cannot find skilled staff at this stage.
  After 16 years, when we are in a depression—as many people call it—is it not extraordinary that sufficient skilled men are not available? Does not that mean that there is something sadly wrong with the results of the training boards?
  Many training boards have made representations to us. Most hon. Members will have received a pamphlet from the Distributive Industry Training Board. I should declare an interest at this stage, because my firm's annual contribution to that training board is over £3,000. In its annual report it states that it looks after the interests of 750,000 people in the distributive industry. However, the document, entitled "What's the Future?", claims that there are 100,000 trained instructors in distribution, looking after a work force of 750,000.
  That is an odd claim for the board to make. It must be considered. What qualification is required for a person to be a trained instructor? How is that number reached? Do we want 100,000 trained instructors to look after 750,000, or has something gone drastically wrong with the training? As it is likely that the Distributive Industry Training Board will be abolished, it is worth recording that in the document the board states:
  "It is the Board's view that in an industry as diverse as distribution—which includes retailing, wholesaling, mail order, credit trading, builders' and plumbers' merchants—no single voluntary body could be established to ensure that the industry's training standards are maintained and developed."
  Do hon. Members think that a statutory body can be responsible for training for such a multitude of purposes? I do not, and I believe that that board is suitable for the axe.
  I have another reservation about the Bill besides the one mentioned by the hon. Member for Rochdale. It empowers the Secretary of State or any of his successors to establish boards without the approval of the House. That worries me. In Committee on the 1973 Act, the right hon. Member for Lewisham East (Mr. Moyle) made fun of that proposal, to such an extent that the then Minister assured him that there was no such intention.
  I am happy to vote for the Bill because it moves in the right direction. If my right hon. Friend uses it as I hope he will. I think that we are signing something of a blank cheque, which goes very much against my principles, but we shall look for some assurances before Third Reading.
  6.31 pm
  Mr. Jim Craigen: Until the hon. Member for Croydon, North-West (Mr. Taylor) ended his
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  speech, I thought that he was a most unhappy man. He did not like the 1964 Act, he was unhappy about the 1973 legislation and he had misgivings, with which I agree, about the enterprise zone exemptions in this Bill—yet all three were introduced by Conservative Governments.
  The Bill is designed to save the Exchequer £50 million. The irony is that the Budget forecast will be exceeded by about £500 million, because the average level of unemployment is considerably higher than last year's Treasury forecast. We should keep this matter in perspective. I doubt, moreover, whether the Treasury will be able to recoup the £50 million entirely, because, with the operation of corporation tax, the Treasury's net receipts may be considerably less. The training services side of the Manpower Services Commission activities will be at the sharpest end of the cuts. That was made clear recently to the Employment Select Committee when we interviewed the chairman of the MSC.
  The reasons for this Bill is that it was realised that a number of things needed to be corrected in the 1973 legislation. I hope that there will not be false economies, since I believe this Bill to be premature. Neither the TUC nor the CBI has been able adequately to consult its members. They do not know what their members feel about the Government's proposals.
  This is not a good time to make such fundamental changes in our system of industrial training, because the changes of attitude which are necessary will not be achieved from employers who face increasing costs, nor from employees when nearly 3 million people are out of work. One in 10 of the working population of Britain is out of work, and the ratio is one in six in areas such as Strathclyde, which includes my constituency.
  The return to voluntarism is fraught with dangers, as a number of hon. Members have said. If it had worked, we would not have required the original 1964 Act. Industrial training in companies has an important role to play. In their frequent exhortations for greater productivity, Ministers point to the need for better training in British industry, and there is a need to develop employee opportunities. All too often, training is seen as an overhead and not an asset to the running of a company.
  Reference has been made to skill shortages. They largely arise from the training weakness, both individually and collectively, of companies. The changes proposed in the Bill will not help to meet the needs which will arise with new technologies. I do not suggest that the present ITB system is perfect, but the whole thing might easily be swept away or eroded so that its effectiveness is severely crippled.
  Before the Secretary of State makes proposals for merging or abolishing particular ITBs, he should give the House his reasons. I do not agree with everything that the hon. Member for Rochdale (Mr. Smith) said, but he made a valid point over his anxieties about the textile industry. If that is one of the boards which will be axed, there should be a debate in the House about the Secretary of State's reasons for thinking that it is dispensable.
  Voluntary bodies do not report to the House of Commons. Nor will the firms within that industry be compelled to join the voluntary training arrangements which might be decided. One of the weaknesses of the 1964 legislation, which was implemented by a Labour Government, is that, although we can easily sort out the shop floor, it is more difficult to sort out the priorities within the board room.

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  Personnel management and training—I have had some brief experience of both—do not rank high in most boardrooms. They are not always regarded as important operational functions. That should change. In their dealings with executive and non-executive directors of companies, Members of Parliament sometimes find that their performance leaves much to be desired.
  I agree that there is a need to correlate the duration of apprenticeships and the standards achieved. I speak from experience, because I served an apprenticeship in the printing industry. I took full advantage of the day release and evening class facilities. One should not overlook the contribution by ITBs recently to improving the standard of apprenticeships. Nor should we overlook the fact that one could easily reduce the training content for many professional qualifications. Before I came to the House I worked for the Scottish Business Education Council, which was involved with the educational qualifications of a variety of bodies, not all of which operate only in Scotland.
  The Government may want to help late developers who are denied their chance at 16, but with rising youth unemployment it is not the late developer but the non-starter who will benefit most from any change in that direction—in other words, the youngster who is denied permanent employment altogether in his or her teens. With longer-term unemployment among youngsters rising, we must take hold of the suggestion put forward by the hon. Member for Beeston (Mr. Lester), that there should be some forging of links between the special programmes division and the training services division of the Manpower Services Commission. He referred to himself as a "One Nation" Tory. I suspect that he paid the price for that outlook. In my dealings with him, I found that he had a personal commitment to improving training.
  Adult entry will have its price. I cannot imagine older men and women seeking to come into a craft area without expecting a higher rate of pay than that available to 16, 17 and 18-year-olds. Moreover, they may look for exemptions for certain aspects of training, despite the fact that in recent years the length of apprenticeships has been reduced, especially since the raising of the school leaving age in 1972. Adult entry may force the pace of State funding of the initial period of apprenticeships. Nobody gives a second thought—although the Government have their plans—to the funding of youngsters going to universities. The State is prepared to meet those costs. Adult entry will probably press the claim for greater State funding of the initial costs of training.
  Adults will, I think, invariably work for the company. I can foresee a position where adult entry is seen more as a means of escalating the skills of those already employed by the company, rather than the company taking on some unskilled or semi-skilled persons. The tendency will be to give unskilled or semi-skilled employees the opportunity to upgrade their skills.
  While the Government may wish to abolish industrial training boards, the very fact that they are moving in the direction of adult entry means that some form of apprenticeship board or authority will be required to oversee arrangements concerning recruitment, content, duration, and certification of craft apprenticeships.
  A major management development problem exists in British industry. There is a considerable challenge in trying to maximise the potential of employees. Most firms do not fully utilise the potential of those whom they
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  employ. That point was brought out vividly in the reports of the National Economic Development Council, produced some time ago, about skill shortages. The reports said that many of the craftsmen leaving engineering and other industries do so after redundancy because they see little or no long-term career prospects. In other words, there is a considerable wastage because people do not receive the satisfaction for which they are looking—and rightly so—in the jobs that they do. I hope that there will be some link forged between the "little" NEDC reports and the individual industry training boards. Too many of the sector working party reports that were painstakingly prepared hit the wastepaper basket rather quickly. There is a need to link up the tripartite input of many of the "little" NEDC working parties with the work of the industry training boards.
  I turn briefly to the 16 to 19 age group. I read the Macfarlane report. I do not wish to be partisan, but, as with many other reports that we read as Members of Parliament, I did not think that it said anything fresh or radical about where we should go. It certainly did not proffer any additional resources to enable us to get there. There is no doubt that a sizeable section of the working population never achieves the advantage of initial employment training. It might be argued by some companies that they do not require any initial employment training. There is a danger that we might re-invent the wheel. Far too often, our secondary schools are engaged in doing remedial work that should have been done in our primary schools. Our further education colleges become involved in repair work that should have been done in the secondary schools. I hope that that will be taken on board when we consider the problems of linking what is done in our educational system with what is required in our industrial system. For example, the "open tech" sounds very imaginative. We have an Open University, but its students are up in arms because of the increasing costs of studying at it. It is fashionable to talk about distance learning. I spent six years in educational administration, and I am well aware of the Carnaby Street fashions in that line.
  There are skillcentres. One of the problems that frequently comes before the Select Committees and other bodies is the reluctance of employers to recognise the output of the skillcentres, and a not unnatural diffidence by some trade unionists, in times of high unemployment, to accept the output of those from skillcentres.
  Dr. Hampson: When Lord Crowther-Hunt put forward a similar idea to the "open tech", he received less support from the then Labour Government than this idea is receiving from this Government. We have accepted the principle. My right hon. and learned Friend the Secretary of State has done a great deal more than the previous Labour Government.
  Mr. Craigen: I am not disputing that point. I am simply suggesting that the idea sounds good. I even read the pamphlet on the subject produced by the hon. Member for Bristol, North-West (Mr. Colvin). I have read a number of other articles on the "open tech", but it is all rather vague. We already have skillcentres. The problems in distance learning will crop up—make no mistake about that. Much ground work has still to be done. I am not closing my mind to it, I am simply sceptical about how far we can take that idea.

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  The industrial training boards must be more effective. The 1964 and 1973 legislation said what they could do. We must develop criteria for what they should do if, as is proposed in the legislation, the boards are replaced by voluntary bodies. One difficulty is the rising overheads of employing labour. I fear that too many employers will look for short cuts and ways to reduce their training costs at a time when they should be spending more on training.
  This argument about training costs is particularly relevant when one is discussing the recruitment of young people. There are employers who will say that the cost of employing young people is too high because employers have to pay the training costs involved. Therefore, we shall have a situation in which more firms will try to subcontract work or to upgrade the employment skills of their employees as a means of saving labour.
  This Bill is premature. It gives the Secretary of State for Employment authority, yet the House has had no clear indication how he proposes to use that authority. Therefore I regard the Bill not just as a bad Bill; in some ways it is a dangerous Bill. Both sides of industry have already made it clear to the Select Committee on Employment that they need more time to consult their members. We have the irony that the CBI does not want the employer to bear the cost of £50 million, but the TUC does want that—although the TUC recognises that a longer breathing space is required by way of transition.
  I say to the Secretary of State: do not just think again about this Bill; think what it is likely to do to the future of industrial training. For that reason, I shall be opposing the Second Reading of the Bill, along with my colleagues.
  6.51 pm
  Mr. David Madel: I agree with the hon. Member for Glasgow, Maryhill (Mr. Craigen) that a considerable amount of spadework must be done before the "open tech" can be made operational. I also agreed with him when he pointed out the place that skillcentres will have in bringing about the fulfilment of this concept. I happen to think that we have quite a bit of ground work to do on the way in which skillcentres are fitting into this country before we move on to an "open tech", although I do not in any way criticise the Government for the idea. From what the MSC has said, I am certain that a great deal of work is already being done.
  The hon. Member for Maryhill reminded us that the Bill comes at a time of acute difficulty for the economy, especially for those who are seeking work. What we have now is an opportunity to improve our training substantially so that when there is a change in the economic circumstances, this time around, at least, we shall be ready for the upturn.
  We should also remember, however, that at a time of recession, training must be seen as a cushion and a help for those who cannot find work, as well as an aid for industry. It is a two-pronged effort at present. We must never underestimate the help that training can give to people, if a suitable training course is available, if they are unfortunate enough to be out of work.
  However, in the Bill and in the research that has been done, we are not just looking at training in the next two or three years. The decisions that we take now are bound to have a significant effect on the sort of economy and the sort of trained people that we shall have in the 1990s, some
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  10 years ahead. From the available research, we can see that there are three important factors that will dominate this country as this decade moves to its end and we move into a new one.
  First, there is every sign that an increasing proportion of married women will be coming on to the labour market seeking suitable work. Secondly, an increasing proportion of the work force, as we reach the end of this decade, will be in their late twenties or early thirties—in other words, mature employees who will want more access to skill opportunities. Thirdly, by the end of this decade an increasing number of people coming on to the labour market will be British-born workers of overseas ethnic origin who will want access to jobs at all levels of the labour market.
  Unless we think carefully about those three factors and their implications in what we devise in the next two or three years, there is every possibility that by the end of this decade we shall find that we shall be getting it wrong again. Those three factors point to a signal development in education, namely, that there will be a general demand for a raising of the general standards of education in the next 10 years, the like of which we have not seen before, and that if this happens, as surely it must, it must increase the potential for higher levels of training in technical skills, those higher levels of training being more important than the manual skills. In other words, the very thing that we hoped for over the last 15 years—that we should become as skilled a nation as our industrial competitors in Europe—will, I think, come about if we take into account those three factors and adjust education and training accordingly.
  I want to comment on the whole question of skill shortages and how serious it is likely to be in the next two or three years. Mention has been made of the MSC pamphlet "The outlook on training" and the document reviewing the Employment and Training Act 1973. On page 13 of that report the MSC points to the fact that we are suffering from a shortage of computer skills and of many engineering craft technician and professional skills. The MSC adds to that survey done by the National Economic Development Council on the whole question of electronics, from which it was found that in South Yorkshire, Portsmouth and Reading, about 40 to 50 per cent. of firms which took part in the operation and completed the questionnaire thought that the training and skills that they were getting were not matching those which they required.
  In other words, at a time when we are trying to be more competitive, we find that the people going into those very industries in which we have discovered skill shortages are not of a sufficient skill standard.
  What we must ask the Government on the question of how much additional help is needed and how much the Government propose to do concerns paragrah 9.8 of the review of the 1973 Act, which states that the Manpower Services Commission feels that it
  "should provide supplementary funds for action by industry training organisations in pursuance of national priority needs where it is necessary to reinforce (but not displace) industry's own training efforts."
  In other words, the industries in the survey that I have just mentioned will increasingly look to the MSC to supplement, not to displace, what is already being done. When we are considering not only this Bill but the whole question of training it is right to point that out to the

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  Government and to ask whether they intend to push the MSC in that direction and to ensure that there are sufficient funds.
  What has also come out in the debate is not only the question of national skill shortages but that of the way in which skill shortages occur on a geographical basis. Again, I should like to draw attention to chapter 5 of the MSC inquiry. Chapter 5, paragraph 20, states:
  "If the labour force became more mobile, training to alleviate local skill shortages would be less necessary."
  It goes on to say that the increasing significance of married women in the labour force is bound to have an impact on whether the husband moves to seek a new job. The MSC doubts whether there will be substantial changes in the overall geographical mobility of labour in the next 10 to 15 years. In other words, we must solve this problem much more on a local basis and see whether we have the local arrangements correct rather than just look at it as a national problem.
  That brings me to what was mentioned by the hon. Member for Maryhill on the question of the "open tech." My information is that already a number of colleges of education and a number of education organisations are ready with plans to help in this matter and have sent in what they consider to be useful recommendations to the Government as to how they would fit in with an "open tech." What one hopes is that when the MSC comes out, not only with the report of the sector working party into training, but with its own review of how the "open tech." will take off, it will find quite a lot of evidence that in many parts of the country people are now ready to help. We would like to know what action we are likely to see before this calendar year is our.
  I draw attention to one final point in relation to the report. That is the note of reservation on what was otherwise a unanimous report on the question of "The outlook for training." There are three points that come out in this chapter. First, paragraph 4 states:
  "It is generally accepted that most cross-sector skill shortages are essentially local"
  and that they can be solved only by local action. Secondly, the reports states:
  "local education authorities should receive specific grants from the Department of Education and Science in respect of the industrial training, vocational preparation and further education closely associated".
  Thirdly, the report states that the Manpower Services Commission's membership
  "should be extended to give increased educational representation."
  That note of reservation underlines part of the Macfarlane report which called for much closer cooperation between school, industry and education departments and everybody involved in trying to increase opportunities for training and improve standards.
  I turn to a detail of the Bill to which the hon. Member for Rochdale (Mr. Smith) referred in hostile terms. I refer to clause 4 which could be called the relief clause. The Government propose that an employer shall not pay the levy if he in an enterprise zone. I hope that the whole concept of whether levies shall be paid will be examined in detail in Committee. A major employer in a relatively new industry for an area is sometimes faced with sudden, unavoidable redundancies. That is especially so when there is a violent upset abroad and the export market is disrupted.
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  It is vital that such an employer does not diminish his training programme. We should examine clause 4 to see whether we can be more subtle and careful about levy exemptions. I am all for enterprise zones. I hope that they will be successful. However, in the last 18 months, especially in the relatively prosperous South-East, employers have encountered difficulties and have had to make people redundant. We must not do anything that will diminish such an employer's training effort.
  If we are to maintain a strong manufacturing base—and that is the only way to make the country work and to keep it together—training should be regarded as a normal and useful interlude between jobs. It should not be regarded as a temporary expedient to get out of a difficulty. Training and retraining is as important for managers as it is for people on the factory floor. The next two years are supremely difficult and dangerous for the Government because of the level of unemployment.
  The Government have two shields which they should not hesitate to use. The first shield is the youth opportunities programme. My hon. Friend the Member for Beeston (Mr. Lester) explained how we had extended that programme. The second shield is Government action on training. It is a question whether the Government bring everybody in and improve the co-operation between the Manpower Services Commission and the Department of Employment. The Government must get across to the people that if, perchance, they are out of work, they are ready, willing and able to provide imaginative training projects. Above all, that is what I wish to result from the Bill.
  7.3 pm
  Mr. Ronald W. Brown: I agree with many of the points made by the hon. Member for Bedfordshire, South (Mr. Madel). His analysis was extremely pertinent. I wish to follow the thoughts of my right hon. Friend the Member for Doncaster (Mr. Walker), who said that the Secretary of State had stated that he could not understand all the problems surrounding such an innocuous Bill. My right hon. Friend referred to the volume of interest outside the House.
  I wondered how the Secretary of State would match his Bill with his statement in the debate on the Queen's Speech that his Department's objective was to improve industrial training in the long term. As usual, one must look elsewhere for the reason for what is happening. I looked around to see how the Bill had arisen. Not surprisingly, a working party is involved. I could not understand why anybody would want to break up the Inner London Education Authority. We had to examine a Conservative Party working group to discover why that was proposed. The same applies in this case. Everybody in industry is opposed to breaking up the industrial training boards. The MSC is opposed to the Bill. The only argument in favour of the Bill is contained in a document by the Centre for Policy Studies.
  That document does not discuss industrial training boards and their values; it argues why they should be dismantled. The authors of the report had already made up their minds, and they proceeded to produce evidence to prove that they were right.
  The authors are Clive Elliott and Stanley Mendham. Mr. Elliott is a director of a family publishing business, a former vice-chairman of the Young Conservatives, and

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  Conservative parliamentary candidite for Tooting. That figures. He is also a member of the Selsdon group. Mr. Stanley Mendham runs a jewellery business. That adds up when discussing industrial training. He is supposed to be non-partisan and promotes free enterprise. That is good. They are just the chaps to do an in-depth examination of the need to get rid of industrial training boards.
  Let us examine the reasons why they want to get rid of the boards. They are illuminating. Their analysis shows that, despite the cost involved in closing ITBs, a financial advantage is involved. They say
  "The Government should concentrate on prudent general economic policies and try to even out the business cycle … The Government should take action (by close attention to the closed shop provisions) to reduce the powers of the trade unions … The Government should continue to reject incomes policies."
  They are good recommendations on which the Secretary of State can act. He has acted.
  At one stage the Secretary of State quoted an association. When challenged by one of my hon. Friends to say whom he was quoting he refused to do so, because he wanted to quote a view from both sides. There is no problem, because he was quoting people on whom the recommendations are based—the British Multiple Retailers Association, which is hardly knowledgeable on training and industry. It was that organisation that used the words quoted by the Secretary of State about
  "the negative bureaucratic activity into jobs where they could make a positive and immediate contribution".
  That is the sum total of the way in which the Bill has arrived. It is most extraordinary.
  I am parliamentary adviser to the Furniture, Timber and Allied Trades Union. I have knowledge of the wood-using industry. About 50 per cent. of workers in the furniture trade are skilled. The industry uses woodworking machines that are particularly dangerous. It contains many small firms, the managements of which are involved in limited skills. The training record of the industry is exceptional. That is agreed by all sides of the industry. The number of craft apprentices has increased by nearly 20 per cent. The proportion of firms giving all-round training has increased sixfold. Nearly half the firms in the industry have been encouraged to provide some training for the first time.
  Coincidental with a sustained programme of safety training, the number of reportable accidents in the industry, has declined twice as fast as the national average since 1973. It is now just over 60 per cent. of the 1973 figure. The industry is particularly prone to industrial accidents. Hundreds of managers of small firms have been helped to increase their range of skills, and that has been accompanied by a marked drop in the rate at which firms have gone out of business and an increase in the rate at which productivity and exports have risen.
  As for the future, the board is already negotiating a scheme that will improve skill training. It is likely to meet all three of the objectives outlined by the Secretary of State on 29 November, namely, better vocational preparation, a modernised and flexible apprenticeship, and wider opportunitites for adult training. If this training board disappears it will be difficult to obtain agreement on any scheme of this type until a new body has built up the confidence now held by both sides of industry.
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  Even if a comparable scheme could be agreed by a voluntary body it is difficult to understand why most employers would pay any heed to it if no levy were at stake and if no one had a statutory duty to achieve results. I have given only one example of the extent to which the Secretary of State is mistaken in his belief that the national training effort can be sustained by voluntary means.
  Statistics published by the Furniture and Timber Industrial Training Board clearly show that the one period in its history in which no progress was made towards improving training was from 1970 to 1972. At that time the board's existence was under threat. The right hon. Gentleman wishes to emulate that situation. A large number of firms take part in the training effort only because the payment of levy obliges them to take notice. In addition, visits are made by the board's staff, who point out the opportunities and needs for training.
  In a recent study on the supply of skills, about two-thirds of employers told an industrial training board that if they had been left to themselves they would have met their skill requirements by means other than that of doing their fair share of training. Most employers would prefer to recruit workers who are already skilled, and who have been trained by other firms.
  The conclusion is clear. Without a system of statutory responsibility, without a levy that can be statutorily enforced, and without an advisory service, there will be a swift return to the bad old days of the furniture industry, when the costs of an inadequate volume of training were borne by a few of the best firms on behalf of the rest. I have been speaking of the furniture industry, which I know well. I have no doubt that the situation is the same in other industries. I ask the Secretary of State to retain the system of industrial training boards that obliges employers and employees to sit down together, to accept a statutory duty, and to maintain and improve training.
  I also ask the Secretary of State to continue to fund the operating costs of industrial training boards at the Exchequer's expense, and to do so at least until the state of the economy allows industry to take a share of the cost. For the sake of a small and illusory saving, the right hon. Gentleman is placing a whole system at risk—a system whose potential has been proved. He proposes to replace it with a system that has a track record that inspires no confidence.
  We have already noticed the Government's intention to destroy the Furniture Development Council. The council is a statutory body, which was set up just prior to the war. Without any rhyme or reason the Department of Industry intends to destroy that council. The Minister was kind enough to see me. He could say only that there was no point in talking about it, because the decision had already been taken. Although one could ask the Minister why that decision had been taken, one would find no rhyme or reason for it. The Department sent out a questionnaire that had more loaded questions than one could conceive of.
  One question asked "Do you want to pay a levy?" The Minister was delighted when he received the reply "No". He thinks that that is a good reason for getting rid of the Furniture Development Council. Other questions were put, such as "If we got rid of the council, would you pay voluntarily to have development done?" The respondents all said "Yes". They never paid for such development before the FDC was established. Anyway, it would be impossible to get the money from them.

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  It may be argued that we should get rid of the Furniture Development Council and the Furniture and Timber Industrial Training Board. However, history tells us that if that happens, nothing will be done in the development and protection of the furniture industry or in the training of furniture workers. We shall have to import furniture from other countries, because we shall be unskilled, inefficient, ineffective and unwilling to provide our own furniture.
  7.16 pm
  Dr. Keith Hampson: I hope that the House will forgive me if I rudely rush away to another function shortly after I have made my contribution.
  It is worth reminding the House that this is only an enabling Bill. Some hon. Members are talking as if the Government would automatically abolish every board that they know anything about. The strategy for training is important. Everything is still up for grabs. This debate is valuable in so far as that strategy is discussed.
  Hon. Members from both sides have discussed clause 4. The Government have no one to blame but themselves if people read into the Bill something other than a concern for the quality of training. If companies in enterprise zones are exempted—whatever the virtues of enterprise zones may be and whatever the need to stimulate enterprise zones may be and whatever the need to stimulate investment in those zones may be—that exemption will smack of something other than an insistence on training and improving standards.
  Mr. Tony Speller: Is my hon. Friend aware that, perhaps sadly, there is not a training requirement but only a training levy requirement. Hon. Members in all parties may have been mistaken about that.
  Dr. Hampson: I shall refer to that later. There is a great deal of empirical evidence to suggest that in difficult times companies cannot be relied on to undertake the necessary training. That might be the case in enterprise zones.
  Under clause 3(l)(a) exemption from levy will be granted if arrangements are made—
  "for the training, or the training and further education associated with training, of persons employed or to be employed in the industry."
  We have heard many interesting and valuable contributions—particularly from my hon. Friend the Member for Beeston (Mr. Lester)—about the need to widen the scope of the boards and to involve them more at a local level—in cross-sector skill training and so on—and in non-direct training programmes such as the youth opportunities programme and provision for the 16 to 19-year-olds.
  If we wish to maintain a system that has a sanction, we must bear in mind that levy is a sanction. The terms of the Bill should not be so specific and narrow. The power of exemption from levy should be used to encourage companies to do other things such as participating in the youth opportunities programme and in provisions to give work experience to 16 to 19-year-olds.
  It is vital to bear in mind that one cannot turn training on and off. All hon. Members will agree that training is necessary and that the technological pace of change will require more training as the pool of unskilled jobs steadily diminishes. As has been said, training cannot be mucked around or pulled up by the roots. Stability is vital.
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  However, training is not an end in itself. We are in danger of forgetting that. Training involves improving the performance of a particular industry or company.
  We are in danger of assuming that the present system or any future system will take training away from employers. That is not the purpose. The purpose of the industrial training board system was not for the boards to do the training—to lift people out of industries—but to stimulate the companies to do the training and to ensure that the training programmes suited the needs of the companies and the industries of which they are part. In my experience, the better boards have developed useful ways of doing that not by penalising companies by imposing fines but by partnership arrangements with training advisers working out training schemes with the companies and constantly monitoring them to ensure that there is give and take and participation so that training is achieved. As a result, the companies have not had to pay any levy or penalty to the boards.
  There are many boards and varieties of practices and the quality varies. But that is not an argument for knocking out the entire system. It is an argument for reviewing it, and that is what the Government are doing. It is an argument for rationalising the system. There is an argument for readjusting the system as time goes on. As some boards finish, others should be amalgamated. However, it is also an argument for looking at new sectors where there are increasing pressures on the need to acquire skills and to train the work force.
  My hon. Friend the Member for Bedfordshire, South (Mr. Madel) referred to the computer industry. Information technology is an area in which there is a shortage of skilled people. It seems to me that that sector should have a new board created to fit it.
  If we are not to go along with the ITBs, what are the alternatives? I would not object to a voluntary system if my right hon. and hon. Friends could convince me that they knew what a voluntary system would comprise, how it would operate, what sanctions it could conceivably operate under and whether it would do a better job than the albeit imperfect system that we now have. No one is arguing that the present ITB system is perfect. But what are the alternatives.?
  I see one great danger. It is not just the lack of sanctions. As my hon. Friend the Member for Croydon, North-West (Mr. Taylor) suggested, the trade associaions have a vested interest. I do not trust some of them. There would be empire building. Some of them would be looking for an extra role. Therefore, we must have some form of statutory quality factor. We must lay down standards that they should be expected to meet. The danger to which I want to draw attention is that we shall develop a new and ever larger supervisory bureaucracy. The MSC numbers will increase as it attempts to keep a check on the voluntary system to make sure that it is doing its job.
  If one wears an historical hat—which used to be my job before I came to this place—and looks at what happened under the voluntary system, one finds that it was woefully inadequate. That was why Conservative Governments passed two training Acts before this proposed measure.
  I became interested in training because I spent most of my working life in education in schools and universities, and I specialised in it in the House. I looked into the system here and considered systems abroad. What struck me most was the inadequacy of the vocational side of British education. It is appalling. It has gone on like that.

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  Reading reports of the nineteenth century, one finds that people were comparing us with Germany and pointing out that Germany was making a specific State-based effort not only to develop vocational training in young people but to develop technologies. We are still bemoaning that fact.
  In Opposition, I launched a working party to look at the engineering industry. Before Finniston, we made our report on the engineering profession. Interestingly, it was called "The National Investment". Like all other reports, it identified the crying need in this country for more technically qualified people.
  We cannot just wish for things to happen. We have been comparing ourselves with Germany and saying that we are not matching Germany's, Japan's or other countries' efforts. But it does not happen of its own accord. We must have a catalyst in the system.
  As an education spokesman, I complain of lack of involvement in further education in schools. The school-industry relationship is one area on which all Governments have focused attention. However, it does not improve of its own accord. We must have a catalyst to bring the two sides together. We really have not got that catalyst.
  I am not arguing that the ITBs fulfil that role. They have not been very good at it. They are improving, because of their involvement in the YOP, and they are helping, but they could help more in dealing with further education. The ITBs are an instrument which exists. Therefore, we should use, adjust and improve them, not wipe them out of existence to try to set up a new scheme which will have to go through all the agonising process and the difficulties that we have already experienced.
  We need a catalyst to try to make things work. We need some organisation to check standards and to ensure that they improve. We need an organisation to advise business men, particularly small business men, and the education world. We need an organisation to act as a stimulus to schools, further education colleges or colleges of higher education to put on courses which are attuned to industry and meet the needs of local industry. We need a body which can stimulate new thinking about trade.
  All those things need a body which is industry-based. There is mutual suspicion between the educational and industrial spheres. The point about the ITBs is that they are industry-based. Most of them have been trying to improve the quality of their training advisers by taking people from industry, not putting in anybody who comes along wanting a job and does not understand industry. The ITBs know their industries and know at close level the people in the firms with which they are dealing. The boards and the training advisers, not the MSC, are the key cutting edge.
  The boards have demonstrated another need—the production of training materials. Such materials—films and packaged operations—will be needed if we are to move to distance learning. If my right hon. and hon. Friends want a test of the need for training and for bodies to assist firms to train properly, there is the proof of the pudding. They sell their wares, their training packages, in the market place to companies, because they are not available to companies elsewhere in our education and training system.
  Let us rationalise the system, let us possibly reduce the number of boards, but let us also have new boards, where necessary, to cover sectors which have not so far been
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  covered and which are becoming increasingly important. Let us have 10 or 11 boards, not three or four. Let us not, as it were, wipe out the system.
  We cannot assume that employers will meet the nation's training requirements. In a recession, employers are hard pressed for cash, and training is an overhead that all too many want to cut. When times are good, there are skill blockages. The supply side of the economy is not as well provided with skills and talented people as it should be. We cannot leave it to the collective effort of employers to meet the nation's training interests. The nation's interests are at stake. Therefore, we have a duty to have some form of statutory system.
  I hope that the strategy to which the Secretary of State will move will mean that not all the costs will be transferred to industry. Some statutory requirements will still need to be imposed, but I hope that at the end of the day we shall have a system which is genuinely a partnership. Whether or not the boards are called ITBs, we have the framework, so let us get on and improve it.
  7.28 pm
  Mr. Ray Powell: I have listened to the whole of the debate. I heard the speech by the Secretary of State for Employment and the brilliant speeches by my right hon. Friend the Member for Doncaster (Mr. Walker) and my hon. Friend the Member for Glasgow, Maryhill (Mr. Craigen). Having listened to those three speeches in particular—speeches that analysed the Bill, and the extent to which the House should consider the industrial training boards in the light of the Bill, I should like to spend a little time raising and highlighting the objections.
  The CBI declared in a letter sent to Members of Parliament on 6 February:
  "This is absolutely the wrong time to propose to off-load £51 million a year on to industry for the operating costs of training boards (or alternatively their substantial winding-up costs). It will add to the problems of maintaining standards and volume of training.
  The CBI strongly supports Government efforts to reduce public expenditure, but adding now to the costs of the hard-pressed private sector is not the right way to achieve this.
  The CBI supports the sector-by-sector review of the ITBs and is encouraging employers' associations to provide clear views as to how, statutorily or voluntarily, training should be organised in their sector."
  What is the view and attitude of the TUC? It considers that the ITBs have done a good job in the face of difficulty. It prefers a levy-grant system, with all the employers being liable. It wants greater union involvement in training decisions at plant level and no abolition of boards. Indeed, it argues for additional boards. It sees no difficulty in reconciling social and economic goals and wants greater statutory control and public funds to ensure adequate levels of training in transferable skills.
  My right hon. Friend the Member for Doncaster referred to the circulars, letters and statements of the chairmen of the 24 training boards and the observations that they sent to the Secretary of State.
  It is worth referring to John Huxley's article that appeared in The Times on 24 January. He wrote:
  "Government intentions to reorganise the system of industrial training have run into fresh opposition. The chairmen of all but one of the 24 training boards have told Mr. James Prior, Secretary of State for Employment, that a return to a voluntary system would be a retrograde step.
  They say that many companies would discontinue training and resort to the practice of poaching trained personnel from more reputable and responsible companies."

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  I shall refer specifically to the Distributive Industry Training Board. Before doing so, I declare that I am sponsored by the Union of Shop, Allied and Distributive Workers, a union that received a great deal of publicity a few weeks ago on a Saturday at Wembley. The Distributive Industry Training Board issued a statement that reads:
  "The Distributive Industry Training Board, at a special board meeting, expressed its concern at: the implications for the industry if the Board were to be abolished as part of the Government's restructuring of the country's Industrial Training Boards. The Board is issuing this statement to all sections of the distributive trades, to Government departments, and to MPs in order to give expression to this concern. It places on record some of the industry's training achievements since the Board was established as a statutory body in 1968, leading to a more efficient and profitable industry.
  Distribution is Britain's second largest industry. It employs one in ten of the working population. One in five of all school-leavers take their first job within the industry. There are more than 30 different trade sectors. More than 100 separate Trade Associations, many with direct training interests, cater for employers' needs. More than 100 Colleges of Further Education are involved in regular education/training of distributive students.
  The Board believes that a major factor in economic recovery is a well-trained work force. Without trained manpower there can be no effective use of the changing technology which affects the Distributive Trades as much as any other industrial sector.
  The bulk of the public's retail purchases are made from firms within the scope of the Board. The efficiency with the industry—retail and wholesale—runs its business directly affects the cost of goods and, therefore, the Retail Price Index."
  The board suggests that it
  "has always exercised its statutory right to raise training levels in order to pump-prime and stimulate a variety of training operations to meet the industry's wider needs for trained labour. As a result of its policies: The number of trained instructors in distribution has risen from 10,000 to 100,000 … More than 100 voluntary training groups are serviced and assisted financially.
  £1·5 million has been given in direct aid to trade organisations and groups.
  £3·5 million in grants for the training and development of individuals have been awarded.
  £1 million worth of aids—publications, films and video programmes—not available commercially have been produced for the industry."
  In conclusion, the board talks about its future and states:
  "It is the Board's unanimous view that only a continuation of its statutory role will ensure the development of training within the large numbers of voluntary organisations which look to it for training, advice and financial assistance.
  The Board believes that no system of voluntary organisations, without the statutory support of the Board, will ensure the maintenance of training standards amid the technological changes rapidly overtaking the industry."
  I ask the House to give those matters consideration before the Division.
  7.38 pm
  Mr. Alan Haselhurst: I welcome the broad approach taken by my right hon. Friend the Secretary of State in introducing the Bill. My remarks will be in the same broad vein. I was interested to hear that the right hon. Member for Doncaster (Mr. Walker) is wary of radical change. By contrast I welcome it. Unless we have some dramatic new thinking on training we shall not keep pace with events.
  First, I hope that we shall not determine the future pattern of training in terms of whether the industrial training boards should stay or go or whether the State or industry should finance them. The review seems to have sparked off recrimination between the boards and the
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  Manpower Services Commission. The boards have not been sparing in their defence to judge from the paper that has been showered down on hon. Members on both sides of the House.
  There is no judgment that suffices to describe the boards' performance. I do not want to get bogged down in the argument about which board has done well and which not so well. Surely this is the time to produce answers covering the whole spectrum of training—initial and continuing. I suspect that I shall be treading a path that has been established already by my hon. Friend the Member for Beeston (Mr. Lester), although there has been no collusion between us. We have been tinkering with training for years, doing a bit here and there. The results are plainly inadequate, as my right hon. Friend acknowledged.
  My second point is that we should be doing more training. We do not do enough and what we do is a curious hotchpotch of apprenticeships, which have their roots in antiquity and which last for years, and, by contrast, work experience schemes which last for weeks or a few months. There are various types of special training within industry and other schemes to impart special skills which have begun in various ways, most recently by the Manpower Services Commission.
  It is no good arguing, as we do time and again in the House, over who has caused the mounting unemployment. Instead, we should be thinking of how to deal with the problem. It will not be solved simply by pressing the economic accelerator and hoping that a vast number of job vacancies will be created. We shall have to live with a high degree of unemployment for a considerable time.
  In a rather uncertain response to that, successive Governments have moved towards, or perhaps felt their way towards, universal coverage for the 16 to 19 age group with some form of training. We have not decided that that is what we want to achieve, although it is a sensible response to the manpower crisis that we face.
  In the last analysis we must recognise that we shall get more training only by paying for it. What bothers many Conservative Members is that we have not had value for money so far. Perhaps we have not yet tapped all sources of funds which might be available to assist an expansion of the training programe. Not until the Government show their commitment will industry and others get down in earnest to making the best possible arrangements.
  My third point is to try to suggest a new form of structure which might be considered. I wonder whether it is right to look at training, as we have tended to, on the basis of training by the industrial sector or as a quick and easy response to lengthening dole queues. Those are the two ways in which we have seen the greatest increase in the quantity of training in recent years. But the two have not been brought together. We lack flexibility, permanence of schemes and money. Would it not be better to think in terms of a geographical network of training, by having area or county committees? I should not like to be committed to how many special committees there should be throughout the country. The Manpower Services Commission has 28 area committees. I doubt whether that is enough, but I am not sure that we should want to go as far as having a committee in every county.
  An area or county committee made up of local authority representatives, employers, trade unions and voluntary organisations acting as an advisory council, with an executive attached to it, might respond better to the local

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  needs of that community or area. The conventional wisdom would say that the executive—those with the express responsibility for extending training and trying to ensure that people were given training opportunities—would come from the Manpower Services Commission. A more unconventional wisdom might suggest an element of privatisation. If we had incentives in the scheme whereby people were hired on the basis of results, we might achieve something dramatically better than we have had so far.
  A geographically based network would be better able to assess what was needed in individual areas rather than training in a sectoral way. A county or area committee would discover whether there was a need for engineers, electricians, woodworkers or plumbers and would be able to ensure that school leavers and others were aware of the opportunities in that area and could be trained accordingly.
  A local approach might have the additional advantage of attracting more co-operation from local employers. I, too, am sceptical about how far voluntarism can extend. But employers have been prepared to come in on special schemes to help local youngsters with work experience and training if they could see a benefit within the local community. We should try to harness that in a better way than we have so far.
  I do not think that area committees need spell the demise of the sectoral industry training boards. The boards would still have a role. Like my hon. Friend the Member for Ripon (Dr. Hampson), I do not wish to be pinned down on the ideal number of boards resulting from the review, but I see their services being engaged by area training boards, so they would remain a major force in training.
  An area-based training initiative would have a beneficial effect on the types of courses run at skillcentres. Hon. Members will be aware that there has been criticism of the types of courses on offer at skillcentres, and doubt has been expressed about whether they have been in keeping with the needs of the nation. That initiative might also affect courses run at colleges of further education.
  There remains the question of how we finance training, no matter how it is organised. I have already said that one gets only what one is prepared to pay for. I am inclined to the view that some sort of national training contribution has to come. As my hon. Friend the Member for Chelsea (Mr. Scott) said, timing is of the essence when we come to putting further burdens on employers. Such a national training contribution may have to be introduced at a time when other levies on industry are being reduced. There may be a system of exemptions according to the contributions which employers make to training schemes within their area, not necessarily in cash, but in kind.
  Other sources of funding might be more readily harnessed to an area structure. Local authorities and voluntary organisations might be persuaded to come in on certain schemes. We have already had examples throughout the country of initiatives that have been sparked off either by a voluntary organisation or by a local company. Money has been attracted from various trusts because a scheme has been felt to be useful to help local youngsters and the needs of industry in that area. We should pursue that further.
  There would have to be a State contribution. However, the State is already making a sizeable contribution to
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  training. If we are to ensure that training is most relevant to the needs of industry, it is inescapable that employers will have to play a major part in financing.
  Finally, there is the problem of control. One would assume that the Manpower Services Commission would continue to have an audit function. Bearing in mind the arguments that are still taking place about the precise nature of the Manpower Services Commission's relationship with the industrial training boards. I hope that the hand of audit will be lighter in the future than it has tended to be.
  Whether unemployment peaks at 2¾ million or any other figure, there is a massive job to do to make sense of our manpower situation. In all probability we must expect a smaller number of people at work in the future. All the indications are that their competence level will have to be higher in the face of the technology with which they will be dealing. It would be for the greater good of British industry if their contentment level were also higher.
  The challenge is what to do sensibly at a price that we can afford—indeed, we must afford—with those who are preparing to enter the work force and how to maintain their most effective employability throughout their period in it. I hope that the Government will go beyond the possibilities raised by the Bill and will chart a new course for training which is truly in keeping with our national need.
  7.50 pm
  Mr. Derek Foster: I am pleased to follow the hon. Member for Saffron Walden (Mr. Haselhurst), whose views on these matters are always interesting.
  It is the Opposition's duty to save the Secretary of State from himself. He has an unenviable brief. He stands at the Dispatch Box month after month condemned to defend the indefensible—an unprecedented avalanche of job destruction. He stands condemned to recycle the tired cliches of the Prime Minister, herself the mistress of the hunt with her pack of Treasury hounds—the unspeakable in pursuit of the immeasurable.
  The Secretary of State for mass unemployment has one hope of avoiding pillory at the hands of historians. It is to initiate a great leap forward in the quantity and quality of training. Yet, in bringing forward the Bill, the right hon. Gentleman sits absent mindedly sawing through the branch on which he sits.
  The Secretary of State, in his statement to the House on 20 November, said that British industry seriously lags behind its major international competitors in its attitude to training, that British industry devotes inadequate resources to training, that there is therefore an urgent need to extend and improve industrial training, that there are three areas requiring urgent attention—vocational preparation, the apprenticeship system and adult training and retraining—and that there is widespread recognition of the continued need for some sort of industrial training bodies.
  Any rational person listening to that statement would have concluded that those ambitious objectives could be fulfilled only by increasing public involvement in training and by strengthening the training infrastructure, as recommended by the MSC's "Outlook for Training" and by the Think Tank's recent report. He might have gone on to reflect that tripartite discussions among the major partners—management, trade unions and the education service—at national and local level, such as occur in the ITBs, would be the best way of securing co-operation. Yet

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  the Secretary of State, in his naive belief in voluntarism, which had failed miserably before 1964 and has not succeeded in any other European country, is about to dessicate the training boards.
  Presumably the right hon. Gentleman believes that he is reducing public involvement by the Bill and reducing his budget by £50 million into the bargain. Let me warn him that when voluntarism results in a serious reduction in the quantity and quality of training, as it surely will, he will look to some public body, presumably the MSC, to help him achieve his ambitious objectives. The MSC will either have to recreate the industrial training boards or assume much greater central control. Without the buffer of the ITBs, industry will be subjected to much greater centralisation and bureaucratic control—a position far less acceptable than the present one.
  It is widely agreed that at the root of our prolonged relative industrial decline is an inability to respond flexibly to increasing economic and technological change. It is further agreed that our work force needs to be much more flexible and adaptable and must be capable of being trained and retrained frequently during the course of their working lives. Yet the Secretary of State puts his faith in voluntarism.
  It is widely recognised that national training need exceeds the sum of individual company needs. Yet the Secretary of State puts his faith in voluntarism. It is further recognised that investment in training fluctuates inappropriately with the trade cycle and is unduly susceptible to adverse cash flows. Yet the Secretary of State puts his faith in voluntarism.
  It is universally acknowledged that there has been a marked reduction in apprenticeships. That is a serious problem in the North-East where pre-16 academic performance has been much more influenced by the spur of apprenticeship than by the prospect of higher education. Even more sadly, we know that apprentices in various stages of training are being sacked in large numbers. Yet the Secretary of State puts his faith in voluntarism.
  It is hardly surprising that all the ITB chairmen wrote to the Secretary of State on 21 January about voluntarism. Their views have already been quoted, but I wish to quote them again:
  "With one exception, it is the unanimous conviction of ITB Chairmen that this will be a retrograde step and place their industries in the unfortunate position they were in prior to the 1964 Act. Whilst many reputable firms will continue training, many others will make no such effort and resort to their previous practice of 'poaching' from more responsible firms."
  That is also the view of a private training group, the South-West Durham Engineering Training Association in my constituency, for the work of which I have the highest regard.
  Of course the work of the ITBs has been patchy. There are problems of cross-sector skills, and the regional and local dimensions of training are weak. However, those problems are not insuperable. Indeed, they must, and can, be resolved within the existing framework. The Secretary of State cannot deny that since 1964, and again since 1973, there has been an increase in the quality and range of training.
  The burden of proof that voluntarism can maintain the present position, let alone substantially improve it, must rest with the Secretary of State. But I warn him that the overwhelming view of those who know and care about training is that voluntarism will not and cannot work. The opposite view is held by the backwoodsmen on the
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  Conservative Benches and by some in the boardrooms who have little experience but who are paranoic about Government involvement in business.
  The Secretary of State has his ear to the ground, but it is stuck in the wrong patch. He is in danger of further abandoning our young people to the vagaries of market forces. Our work force is our most valuable resource. Tragically, 2½ million are without work. They are the responsibility of the Secretary of State and of us all. But so, too, are the remaining 23½ million who are seriously underutilised, undertrained and undervalued.
  The Secretary of State says that he wants to help, but by this ill-considered Bill he is delivering those people into the hands of the most ill-informed, short-sighted and callous of the Tory paymasters. The Opposition must save them from the Secretary of State and must save the right hon. Gentleman from himself. I trust that those on the Government Benches who care about training and who care about the reputation of the right hon. Gentleman will join us in the Lobbies tonight.
  8 pm
  Mr. Tony Speller: Perhaps it is time to bring in a worm's eye view of industrial training. We worms, while doing a useful job around the grass and on the ground, occasionally get stamped on by large and important feet for which we have no love and of which we have no knowledge. We pay the price. The essence of the training board principle is that the volunteer method will not work but that conscription will. I was a national service conscript. There is no one more adept at fiddling and fooling authority than the unwilling conscript.
  I can speak with some expertise on the subject of training, not only because my own small company has recently received a DITB award, which we are proud and glad to have. I can say without fear of being called a nihilist or one of the strange backwoods creatures, that we worms, who secure the awards, have to tell the Opposition, once again, that training is not compulsory. We are charged a levy. We may pay the levy and forget it, or pay the levy and seek to get some of the money back by following the rules of the game. The argument is simple. If we take part in the course, we will get some benefit, perhaps a lot, and get back all or part of the levy. This means, inevitably, that the more firms that participate the more levy they will get back, and the higher the levy becomes the following year.
  There is another side to the story. In our case, we had to carry out training in order to get our money back. We carried out training. Frankly, to our surprise, we found ourselves a better firm for that training. To the question whether we would have done useful training without compulsion, the answer is "Yes". To the question whether we would have done so much, the answer is "No". In the case of our own small business, which is more a cufflink than a chain of shops, we have benefited, on balance, from the DITB, but many firms in my constituency will be glad to see the back of that organisation. Without the particular interest of one or more management personnel in any firm, the results of work are negligible, although the grant brought back may be substantial, for reasons to which I shall turn.
  In preparation for the debate I consulted widely in my constituency. The North Devon Manufacturers's Association tells me:

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  "The general feeling is that the Boards did a good job initially but that they have achieved their purpose even to the extent that their interference in the running of businesses is resented. They have outgrown their usefulness and should be terminated. Most businesses had organised their own in-company training schemes or used schemes within their own industry, as for example, the British Pharmaceutical Society and Chemical Industries Association".
  Similarly, a young group of business men in the sales and service industry have formed their own training group. They enjoyed training and being trained. I recently presented seven of them with DITB certificates. They make full use of the grants available.
  Constant reference has been made, not always with true attribution, to the vast amount of work done by the Furniture and Timber Trade Board. I imagine that the board must have spent a great deal of money—its money or our money, but someone's money—to push its case to every hon. Member. I have counted five references or quotations relating to its work. I do not know whether it is the Government's position that an individual board has the right to use the money intended for training to propagate its own success story or, more importantly, to ensure its own survival. Interestingly, I have had strong praise from that board from one small company. A slightly larger company says:
  "On balance, the Training Board is a luxury which industry cannot afford. Efficient and profitable companies will train staff effectively whether or not they receive financial assistance. The documents are usually produced by most companies just before a visit by the Training Board Officer or at the end of the company's annual claims period. The failing of the training board is that it does not actually train anyone and only by means of indirect blackmail does it attempt to encourage its members to do so …"
  We have an excellent range of technical colleges throughout the country. I fear that technical colleges are barely used in training through the boards. A whole new industry has grown up through the training board levy, in the shape of seminars. My hon. Friend the Member for Ripon (Dr. Hampson) spoke about the success of firms selling equipment for these courses. That is not surprising. It is a self-perpetuating business. The courses lead to the purchase of equipment. The courses are funded by the levy. So it goes on. It may be good business, but I do not believe that it is good business for the country. A highly respected company in my area reports that during the course of the year he generally receives one short visit from a training board adviser and once every two years a visit from the training board examiner. These are the only effective contacts that occur.
  I have benefited from training. If we are to talk about industrial training boards we should also talk critically about the MSC itself. A minnow that cost £250,000 seven or eight years ago now costs £15 million or £16 million, with clearly more to come. The MSC role is different from the industrial training role. It is largely a social role. The youth opportunities programme does not create work. It is an aspirin against the pain of unemployment. It is not a cure. Work experience is another "funny" as seen by we who are the worms. Work experience is the easiest way of getting cheap labour. It is the cheapest possible, because it is free. I wonder how many people would be in genuine employment if firms were not able to get a work experienced youngster for a few months for nothing. This
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  is the problem. Every good idea tends to distort. The work experience programme has distorted our retail trade economy.
  The functions are different. The training board is designed to produce a highly skilled work force and highly skilled management. The MSC does not at present have that function. There is a sinister sentence in the explanatory memorandum to the Bill which leaves ajar the door to greater cost. It reads:
  "Changes in the number or scope of training boards would lead to changes in the staffing requirements in the Manpower Services Commission, but this cannot be quantified at this stage."
  Many hon. Members recall how this game of incremental musical chairs has been played over the last decade in the reorganisation of local government, the National Health Service, and the water industry. All these interesting reforms were carried out with the best intentions in the world. Nevertheless, at the end of the day, when a number of the ITBs are shut down and their functions transferred to a bigger body that does not possess the technical expertise, more staff will be needed. Before my right hon. Friend makes up his mind in consultation with the MSC, I have one suggestion. Should we ask those who pay the levies and those who get the benefits how they feel about the industries?
  I am aware that there is a vast piece of paper, which is hard to read and difficult to fill in. I speak as an expert on these forms. I can complete VAT forms, no less. The latest form is another example of that wodge of statistics that goes on producing nothing except more statistics. I ask my hon. Friend, when he carries through the Bill, as he will, to look carefully and cannily at all forms of training and to ask individual firms how they would like to see matters proceed, not with a 15-page statistical memorandum, of which eight pages are instructions on how to fill in the forms.
  To let the MSC take over the advisory function is not unakin to inviting the spider to consider—in a judicial fashion, of course—whether the fly should be inside its web. Some of our ITBs are very good and must be preserved. Some may well have outlived their usefulness, and can be closed down or merged. But I should very much regret it if, for the sake of a doctrinaire approach, we built one big body in substitution for one large and several small bodies. I suspect that quite often—as we always say on the Conservative Benches—small is beautiful. In my knowledge it is normally more efficient.
  8.10 pm
  Mr. John Evans: The backdrop to the debate is nearly 3 million people out of work and hundreds of thousands of boys and girls who cannot obtain the apprenticeships that they desperately require and that their fathers and mothers wish them to receive. As many of my hon. Friends said, the background to the debate is also the Secretary of State's words in the debate on unemployment on 26 November:
  "I want to make it clear that the Government's aim will be to extend the area of reliance on voluntary arrangements as far as possible, and to keep statutory industrial training boards in a few key sectors".—[Official Report, 26 November 1980; Vol. 994, c. 688.]
  Following from that, clause 1 will give the right hon. Gentleman the power to abolish industrial training boards.
  Every intelligent person accepts that there should be a continuing review of all the work of all the boards. No one has suggested that the board should be fixed for all time,

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  or that they should never review their work. No one would suggest that the House should never review their work or the working of the legislation. In an intervention, I asked the Secretary of State to justify introducing the Bill at this stage, when the correct method would have been to await the report of the Manpower Services Commission and then to have a full-scale debate, in which the views of all those in industrial training could be taken into account. Then we could have had legislation that was non-political and non-partisan.
  Party politics should not come into the consideration of the need for industrial training. Yet, despite the Secretary of State's honeyed words, the Government have introduced a Bill that is contentious, political and controversial. It will be bitterly contested in Committee. That is not how to proceed with legislation on a matter that has been non-controversial for many years.
  The Second Reading of the Bill that became the Industrial Training Act 1964 was agreed without a Division in November 1963. All sides of the House welcomed it. Then, and for many years since, all sides paid lip service to the necessity for training. Tonight we are considering a Bill that can only set industrial training back.
  It is too much for the Secretary of State to suggest that it is other people who are creating uncertainty. It was his words that created a great deal of uncertainty among the first-class men and women who man the boards. It is morally wrong for him to introduce legislation that puts in jeopardy those who have given so much to industrial training. Even at this late stage the right hon. Gentleman should reconsider the need for the Bill.
  The main purpose of the 1964 Act was to improve the supply and the quality of the country's skilled manpower. The background was the general recognition that there was a grave shortage of skilled manpower and womanpower, and that industry was not training the quality or the quantity required.
  It goes without saying that many firms—the best firms—always had excellent training schemes and spent a great deal on training boys and girls that they would require in the future, but it is incontestable that many other firms, particularly small firms, were not training anyone and were happy to poach the supply of skilled labour when the boys and girls finished their apprenticeships.
  I am one of the few hon. Members who have served a skilled apprenticeship. Mine, which I did in the shipbuilding industry, was not as good as the apprentices have received since the 1964 Act. One can only assume that the Government are prepared to go back to 1964. That is in line with much of the regressive legislation that they have introduced throughout their unfortunate two years in office.
  Each board was charged with two main functions: first, to ensure that the amount of training in an industry was sufficient; secondly, to publish recommendations with regard to the nature and length of training for different occupations and the further education that should be associated with it. Most fair-minded people would agree that the majority of boards have done those jobs.
  It would be nonsense to suggest that the boards have solved the problem. In certain areas and in certain crafts, particularly in the engineering and electrical crafts, there is still a considerable shortage of skilled people. But there is no overall shortage in the country.
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  The present Government have played havoc with the employment transfer scheme, which allowed skilled people to move from one part of the country to another to obtain employment. The changes that they have made have had a detrimental effect on skilled workers travelling from one part of the country to another. When Conservative Members continually speak of the shortage of skilled labour, I hope that they will take into account what their own Government have done since May 1979.
  Those who would criticise certain boards have a duty to name the boards concerned and to tell the House where they have fallen down. It is not enough to say that there are good, bad and indifferent boards, and on that basis to introduce this legislation. We should be told which are the bad and the indifferent boards. The Secretary of State has not offered a shred of evidence to suggest which are the bad boards.
  What the right hon. Gentleman has made clear is that he is interested in saving £50 million. I doubt whether he will save that sum. I suspect that the matter has more to do with the Government's public sector borrowing requirement or the various fairy tales that they tell us about it than with the realities of the situation.
  The Government must agree that if we go back to the voluntary arrangements we shall simply be going back to the period before 1964, when the good employers trained and the bad employers did not. In that respect, because of the tremendous decline in British industry since the Tory Government came into office, employers have cut dramatically the taking-on of young people. It is easy for employers quickly to cut back in that area.
  Many firms and many hon. Members can report cases where, during the past two years, employers have cut down substantially on the number of young people being taken on. We all know the end-product of that. I do not wish to raise the spectre of vandalism, or how much it costs in terms of keeping people unemployed. However, it is generally accepted that the cost to the nation of keeping 3 million people unemployed is about £10 billion. When we talk about saving £50 million—a highly doubtful £50 million—we should put that figure beside the £10 billion that unemployment is costing the country at present.
  If, as seems likely, some boards will be abolished after the Bill is enacted and after the review has been carried out, there will be heavy pressure on Members of Parliament for other boards to be abolished. It is not sufficient for the Secretary of State to imply that he is a reasonable man and that he will act in a reasonable manner. We have no guarantee that the Secretary of State for Employment will continuously occupy his present position, and I shudder to think what certain Ministers and Back Benchers would do with this legislation. We have heard only one speech in outright opposition to industrial training boards—from the hon. Member for Croydon, North-West (Mr. Taylor)—but we know that other Conservative Members think similarly. This will be an extremely fascinating Committee on which to serve, because Conservative Members will be in difficulty if they oppose our amendments. We shall ensure that their names and their votes are well and truly recorded.
  I am aware that time is short and that other hon. Members wish to speak, but I wish to emphasise one point. It has been said repeatedly that training and retraining are essential, yet the Government are introducing a Bill that can only set back industrial training. In that respect, we

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  wonder about the mentality of the Government. The Bill is unnecessary, and I sincerely hope that if we cannot defeat it on Second Reading we shall maul it in Committee. In Committee we shall produce a Bill that will do something for industrial training. This Bill will have only a controversial effect on training.
  8.23 pm
  Mr. Warren Hawksley: I have a constituency interest in this proposed legislation, particularly with regard to training establishments. At High Ercall in my constituency we have the MOTEC training centre, which is run by the Road Transport Industry Training Board. It is an interesting centre and I have visited it on many occasions. My comments will centre mainly on that board, but they will also cover points that are equally applicable to other training boards.
  There is general agreement that something should be done about training. We must improve and extend our training. Our argument today has been about how much should be done. At a time of recession, it is essential that training be given added emphasis. In my constituency I have the highest level of unemployment within the West Midlands. Only last week there was an announcement that there would be a further 1,000 redundancies at GKN-Sankey. Now, about 9,000 of my constituents are out of work, and, although we are a new town area, the new town corporation has had to advertise for certain skilled workers, not only throughout Britain but also in Rhodesia and South Africa. When it happens at a time of very high unemployment, it suggests that something is wrong. It is important that more emphasis is given to training. When the economy moves forward, as I am sure it will, the need will be even greater than it is today.
  If we accept the current need and the even greater future need for trained workers, we must turn to the existing training boards to see whether they make the best use of the available resources and also see whether the Bill helps or endangers, as some hon. Members suggest, the future of training.
  We hear of the suggested extravagances and the over-provisions made by certain boards. That may be so. However, in the case of which I have knowledge it is not so. The Road Transport Industry Training Board has recently rationalised its training methods. That has resulted in craft training being moved to Scotland and in management training being concentrated at High Ercall. This is a response to the present situation.
  If all boards are not being as responsive to the current economic situation as that, what can be done to make them do so? The Bill allows for the financing of the boards to move away from the Government, supported by the levy, to financing by the industries themselves. This I support wholeheartedly. If an industry is paying, it will make sure that any extravagances which are there today are cut out and that training is offered in a more appropriate way to that industry.
  Industry is a much better judge than politicians on either side and the Government of any political party of what is needed. The industry, not the Government, will decide the pay of its employees. We have had suggestions that certain employees either are paid excessively or are getting very
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  good conditions and pensions. If that is the case, and the industry has to pay, I suggest that it will put that part of its house in order very quickly.
  That brings me to clause 1 and the powers which the Secretary of State is taking to abolish and to amend training boards. I am fearful at this time of economic recession of the practical result of moving a board from statutory to voluntary status, however appealing that argument may be in theory. The hon. Member for Rochdale (Mr. Smith) drew attention to the disappearance of apprenticeships in the present economic position. We have to accept that that is happening, and it is very likely that, in the short term, industry will not be prepared to put in the necessary money on a voluntary basis. Therefore, it is worrying that the power is in the form that it is in at the moment.
  I hope that the Government, possibly as the Bill proceeds, will consider changing the wording slightly in order to allow at least an affirmative order in both Houses before either changing or abolishing one of the boards. Then we shall have an opportunity of debating a board's merits or faults in deciding what we feel should happen to it.
  The argument for bringing in this Bill before we knew what the Manpower Services Commission would recommend concerned the delay that would be occasioned by so doing. I suggest that an affirmative order of both Houses would not delay the implementation of policies very much.
  I question whether the MSC is the body to give too strong advice to the Secretary of State. I say that because of the problem which has arisen in my constituency concerning skillcentres. The commission has closed a skillcentre in a locality with the highest level of unemployment in the area. At the same time, it has expressed a wish to open a new skillcentre down the road in Redditch. This seemed to be folly. It appeared to be politics, with a small "p", at work in the MSC. I am worried about the fact that the same body should be making recommendations to the Secretary of State on which decisions will be taken.
  I hope that the Minister will not only be able possibly to offer some safeguards and some opportunity for the House to debate these decisions on future once the MSC's recommendations are received, but that he will also consider letting us know what other consultations there will be and whether he will consider producing a consultative document to allow us all—not just hon. Members but people in industry and in the unions—to put forward what they think about individual boards. This seems desirable to make sure that, in looking at every board, we decide which are the right ones to alter.
  8.30 pm
  Mr. Stan Crowther: One of the most interesting features of the debate has been the remarkable number of Conservative Members who have expressed views greatly at variance with those of the Secretary of State.
  Those views can be fairly summed up by two remarks in particular. One was made by the hon. Member for Chelsea (Mr. Scott), who was worried about the concept of the baby being thrown out with the bath water. The other was made by the hon. Member for Ripon (Dr. Hampson), who said that, although there was a case for reviewing the system—no one disagrees with that—that

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  was not a reason for knocking out the whole system. I do not know how people with such views can conscientiously vote for the Bill, because clause 1 is specifically about throwing out the baby with the bath water. That is what it is there for. The Secretary of State made it clear that, when he gets those powers, he will knock out the whole system with the exception of what he calls a few key sectors. Therefore, I do not know how those Conservative Members can support the Bill after expressing those views.
  The Secretary of State has not been so kind as to tell us what are the few key sectors which will be saved from being knocked out. He said that they would be sectors in which it would be considered essential to retain the industrial training boards in order to achieve certain wider training objectives. He did not even tell us what training objectives he hoped to achieve, although he gave us some wordy, but woolly, objectives in the second half of his speech. Possibly those are the ones he was talking about.
  It is unclear whether the right hon. Gentleman means that all the other industries which are not key sectors are not worth bothering about in relation to those wider objectives or whether they need the objectives but can achieve them without ITBs. It would have been kind of the Secretary of State to tell us what he meant by that sentence. It would be nice of him to tell people working in industry. As my right hon. Friend the Member for Doncaster (Mr. Walker) said, people in industry would be interested to find out which industries are not considered by the Government to be of any great importance. There may be some interesting reactions when they find out.
  I am worried about the way in which the Government are once again—as so often before—taking powers to act in an arbitrary and dictatorial way. That feature comes out particularly in employment matters. I wonder why Ministers feel that they are always bound to be right, whatever everyone else may say. Whatever advice may be given by people who are experienced and skilled in these matters, the Government must be right. The unshakable conviction that everyone else is out of step causes much concern to many people both inside and outside the House. I wish that from time to time Ministers would show enough modesty to accept that people who have worked in industry all their lives and who have been involved in industrial relations and industrial training have something to say which they ought to listen to. That is not the way in which the Government behave nowadays.
  Instead of contemplating the abolition of ITBs, the Government ought to be working out ways of increasing their effectiveness and expanding their scope, possibly by giving them new roles in various areas, such as promotion and publicity. There is a need to persuade young people that it is in their interest to achieve skills to enter skilled employment. Employers should be persuaded of the need to increase the number of apprenticeships available, even during a recession or a slump. The Secretary of State expessed his concern about that matter today, as well as previously on 26 November. Surely the ITBs themselves could be doing a useful job here.
  When I was a member of the youth employment committee in Rotherham in the 1950s, during one of the periodic credit squeezes that we used to get then, we were very concerned about a severe shortage of apprenticeships for boys and girls. We found that it was by no means a local problem: it was a national one. The Government of the day set up a departmental committee under the
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  chairmanship of the then Mr. Robert Carr, now Lord Carr, which produced the Carr report, which drew attention to this serious matter.
  That warning was totally justified a generation later by a serious shortage of skilled people. Now we shall build up exactly the same problem for the next generation. We must give a great deal of attention to this matter and I am pleased that many hon. Members have commented on it today.
  One of the most disastrous consequences of the appalling unemployment among young people today is the fact that we are pouring down the drain a great potential of skill without which the country will not survive in the twentieth century. These youngsters, who should now be acquiring the skills that the country will need in the next 10, 20 or 30 years, will be driven into a hopeless and despairing backwater of idleness instead of gathering the training and the skill that the country, never mind the youngsters themselves, will desperately need.
  We need a sophisticated planning system to assess properly the manpower requirements of each industry, to take account of technological change and its effect on manpower requirements, to assess its effect on the appropriate length of the working week and the proper age for retirement and to guarantee proper training at all levels, in apprenticeships, in university courses and in the polytechnics. Without such a policy, we shall not solve this problem.
  I am afraid that the Bill will drive us back rather than forward. The most precious of any country's natural resources are its people. A country that wastes its people by keeping them unemployed when there is work which needs to be done, and which keeps them unskilled when skills are needed, is heading for disaster.
  8.37 pm
  Mr. Richard Needham: I shrink from bandying words with the right hon. Member for Doncaster (Mr. Walker) when he is in such good form as he was today, but he did not do the cause of training much good. He largely exaggerated the effects of the Bill and of what my right hon. Friend is trying to do.
  On 27 November, the general secretary of the TUC said:
  "With determination and the provision of adequate resources, the various interests can bring about the fundamental change of attitudes that a programme of this kind entails. But it will need careful handling, and a basis of mutual trust and confidence is critical."
  I believe on reflection, that the right hon. Gentleman will realise that he did not help that cause today.
  I asked the right hon. Gentleman whether he did not accept that there were severe problems in our training arrangements, described in "Outlook on Training", the CPRS review and many other reports. It cannot be denied that everything is not a bed of roses. He replied that a touch on the tiller was all that was required.
  Does the right hon. Gentleman really say that that is sufficient to put right our out-dated apprenticeship system? Is he prepared to say that a touch on the tiller is as far as we should go for the 35 per cent. of young people who have no systematic training after they leave school? Is he happy about the fact that all YOP and YOP-related courses are offering, besides some basic work experience, any adequate level of training? Is he content with the provision for education in the last year at school?

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  The right hon. Gentleman said that the 100,000 TOPs courses would be reduced to 55,000. Is he convinced that they provide adequate courses for those who need training? Is he saying that skillcentres are providing the qualifications that industrialists are prepared to rely on when they employ people? Those matters are extremely worrying. They need more than a touch on the tiller.
  Mr. Harold Walker: I do not want the hon. Gentleman to misunderstand me. Our exchange of words a few hours ago was about the Bill, the MSC's report "Outlook on Training" and the structure of the industrial training boards. I said that everything was not right with the industrial training boards' structure but that the Secretary of State was exaggerating what was wrong and using that as a justification for butchering the boards. We were not talking about whether I was satisfied with the apprenticeship and training systems. There may be a great deal wrong with those systems, but that is another matter. Perhaps we could debate the same in Committee.
  Mr. Needham: I am grateful for that explanation. But my right hon. Friend the Secretary of State made it perfectly clear in his statement on 16 November that he is as much committed as anyone else to a reform of the present training system. I am glad to say that I have rather more confidence in my right hon. Friend's judgment and determination than have Opposition Members.
  I turn to the record of the industrial training boards. It is clear that of the 24 training boards some will be better than others. We must be careful when listening to the firms which criticise them. Such firms can usually be put into two categories—those which carry out adequate training and, inevitably resent having to pay a levy which they then claim back because of the administrative costs of making the claims, and those which do not carry out adequate training or do not provide any training at all and resent having to pay a levy. But there is a third sort—those which benefit from industrial training boards, want them to continue, and want to support them.
  I take slight issue with my hon. Friend the Member for Devon, North (Mr. Speller), who complained that the Furniture and Timber Trade Board had explained to hon. Members how well it was doing. That is a perfectly legitimate action because the board is trying to get across to hon. Members that it is providing a worth-while service. My hon. Friend the Member for Watford (Mr. Garel Jones) and I have received many letters from people supporting the retail industry training board. If real criticism is to be made, it could be of the lack of definition of the role of training boards, which has never been clearly understood.
  There is some need for reorganisation. As time passes, each training board needs to consider its relationship within its industry. It may be better to spread them sectorally, regionally or nationally, rather than industrially. Of course, they have difficulties in their relationships with the MSC. That has come out clearly in all the reviews that have been undertaken.
  The Government must have an overall strategy, which they must publish. There must be a role for the industrial training boards within that strategy. I shall be blunt about the fact that I do not believe that voluntarism will work, The boards should set the standards. Perhaps they should work with the MSC on a contract basis. If they are not
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  statutory, they will die. We should then have two classes of trained workers—those who come under statutory industrial training boards and will have received reasonable training, and those who do not. the Government must carefully consider the question of voluntarism.
  It is of crucial importance that industry takes control of funding. But that cannot be done at a time when industry is suffering as much as it is now. The Secretary of State must look very carefully at the way he phases in the funding and over what time scale he does it.
  Perhaps the Government have allowed themselves to be abused by the right hon. Member for Doncaster and slightly set their own trap. This is a wide-named Bill. It is a broad and expansive phrase. Looking at its contents reminds me rather of going into an exclusive French restaurant and ordering oeufs sur le plat Brecy, which turns out to be fried eggs, chipolatas and tomato ketchup on the top.
  I feel that the peroration of my right hon. Friend the Secretary of State has not been clearly got across today. But this is a Bill which can go forward and which will form part of the Government's overall strategy. However, the powers in the Bill should not be used, certainly until the overall strategy has been seen and discussed. There has been much talk about babies and the bathwater. At the moment we have seen the baby but we have not seen the bath or the bathwater.
  8.45 pm
  Mr. Frank Hooley: I have come to the conclusion that this debate has been staged as a crafty scheme by the Secretary of State to convince the Cabinet that there is no support for what is proposed in the Bill. I have yet to hear any support for the Bill—although I must offer apologies, because there was one Conservative Back Bencher who expressed some serious reservations. Practically every other speaker on the Government side has expressed alarm and despondency at the prospect that what is proposed in the Bill will be carried out.
  The shadow which overhangs this debate is the demographic pattern of youth coming on to the labour market in the present years and in the years which lie ahead. By a grotesque twist of circumstance, we have a peak of outflow of school leavers in the current years—I think that that peak is reached in 1982 or 1983—with hundreds of thousands of boys and girls flooding on to the labour market at a time when we have a Government pursuing an economic policy that is destroying the economy and destroying jobs. In any circumstances, it might have been difficult to have accommodated with useful work and training the flood of school leavers that has come in the past two or three years and will continue for a couple of years more. Given the Government's present policies, the situation has got completely out of hand.
  In a few years' time, towards the end of this decade, we shall have an exactly reverse position. When the drastic fall in the birthrate that occurred in the mid-1970s results in fewer boys and girls coming on to the labour market towards the end of this decade and the beginning of the 1990s, we shall have a totally reverse situation. There will then be a serious shortage of manpower and womanpower in Britain for some considerable time—probably till the end of the century.

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  What, therefore, is likely to happen unless we are very careful with our training programmes now? It is that we shall neglect a five-year cohort of boys and girls, without giving them adequate training or adequate jobs; and once neglected there is a serious danger that they will not subsequently in their adult life acquire the skills necessary both to them individually and to the nation as a whole.
  That is the most desperate and formidable problem which the country faces now in terms of the use of its human resources. If we allow these boys and girls to drift not only without jobs but without training or skill as well, we shall pay a very heavy penalty seven or eight years hence when the situation demographically, as I have explained, will go into complete reversal. Therefore, the debate on training is fundamental and very important for the economic future of Britain.
  The Secretary of State talked about a review this year. A review has taken place already and it was published last July in "Outlook on Training". The review made one or two important points. It referred to the importance of training for the unemployed and vulnerable groups. By vulnerable groups, I assume that it meant handicapped and immigrant groups. Pushing the burden of training on to employers will do nothing for such people. Employers will not provide training for the unemployed. They will not do much for the handicapped or the ethnic minorities. In that sense the Bill is misconceived.
  The review talked about promoting training at times of recession. Heaven knows, we have a recession and the Government are doing their best to make it worse. At such a time it is important to put the emphasis on training. However, the last people in time of recession to provide that training are the employers. I do not dispute that some of the more enlightened employers have the inclination, but at such a time they either do not have the resources or are not inclined to employ them. It is lunacy to propose that we should improve the training system by imposing another £50 million on employers who already bitterly complain about all the other charges that the Government keep loading on to them.
  Nevertheless, the "Outlook on Training" review was right to say that at a time of economic depression more effort should be spent on training and that we desperately need to build up our skilled manpower. The way suggested in the Bill is not the right way.
  Another suggestion in the review was that more effort should be made to provide training for expanding and new occupations. The infant industries will hardly take that on board. That takes a definite and vigorous effort by the Central Government and the community at large. Such a scheme must be funded by the taxpayer. The notion that sufficient training will occur in new and expanding industries by shifting costs away from the Exchequer to industry is nonsense. The review also said that there should be no statutory limit on the levy. The Government have ignored that proposition.
  The training of women has not received much attention. It is important in the engineering industries where for many years the training of women has been neglected. Women provide an important source of skill. We should use it and encourage women to move into the engineering industries.
  I share hon. Members' distaste for the exemption of firms in enterprise zones. I have made no secret of my views about enterprise zones. The defects of that gimmick are emphasised in the Bill.
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  It is hard to understand why the Secretary of State believes that he is advancing the cause of training by producing this Bill. I am driven to the conclusion that he wants to demonstrate to the Cabinet that some of his colleagues' bright ideas for reducing public expenditure will not work.
  8.54 pm
  Mr. Michael Colvin: I hope that the hon. Member for Sheffield, Heeley (Mr. Hooley) will forgive me if I do not take up some of the points that he made. I thank the hon. Gentleman and other hon. Members for having kept their remarks short. As a result, you have, Mr. Deputy Speaker, managed to squeeze me into the debate.
  I wish to comment in broad terms on our national training strategy—or, perhaps, the lack of it—and on other connected questions such as whether we have the best tools to ensure that our training objectives are met and where the money will come from to pay for them.
  It is widely acknowledged that our national training provision is inadequate. In a speech made a couple of years ago, my right hon. Friend the Secretary of State said:
  "I don't think we do anything like enough training. We're certainly not doing enough training for the jobs of tomorrow and the skills of tomorrow."
  Those are hardly the words of someone who does not believe passionately that we should improve our training effort. The Bill is designed to do that. Britain suffers from an unemployment rate of 2½ million side by side with an estimated 250,000 unfilled vacancies. There are many reasons for that, but the shortage of skilled workers must result from inadequate training provision. That in turn poses a major threat to our economic recovery.
  The problem is exacerbated by a more dynamic labour market and by far greater worker mobility. The recession is causing a major shake-out in employment. There is already evidence that jobs that are on the increase—and there are many of them—are often, but not always, in high technology industries and require the most training. Conversely, jobs in older and more traditional industries are on the decrease and require the least amount of training.
  Workers will not want to be tied to one job or to one skill for all their working lives. That is not in their interests or in those of the nation. The American Carnegie Institute estimated that the average worker in the United States of America would have eight jobs and three careers in his lifetime. In Britain, the average is two jobs and only one career. We need a far more flexible work force with a wider range of transferable skills. We also need facilities for regular up-dating. The present training system has failed to produce those results.
  Not all hon. Members agree with everything that is said in the report of the Central Policy Review Staff. Nevertheless, it puts its finger on one of the main faults in the British training system when it described the system as far too rigid, conservative and slow to respond to changing industrial needs.
  I suggest that this inflexibility may be caused, in part, by the way in which the 24 industrial training boards are organised. Each one looks after its own rather narrow industrial sector rather than taking a broader view. Certainly, the Bill would give the Secretary of State power not only to abolish industrial training boards but to create

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  new ones. If there were fewer boards covering a wider sector—as the Engineering Industry Training Board does—they might solve the problem of inflexibility.
  I appreciate that industrial training boards do not deliver training. Their role is to provide the keys that will open the doors. If they have failed to do so, the review of each board that is being undertaken by the MSC will identify those at fault. It is said that the prospect of execution concentrates the mind wonderfully. No doubt we can expect a flurry of verbal activity from the 24 industrial training boards in the next few months.
  The right hon. Member for Doncaster (Mr. Walker) held up a great pile of papers that he had received from industrial training boards. Most of us have received the same sort of mail. However, I have yet to be inundated by correspondence, leaflets or briefings from the industrialists who provide the training or from the employees who receive it. The industrial training boards seem to be the only bodies with anything to say.
  It is, of course, right that the Secretary of State should have the powers contained in the Bill. He is ultimately responsible for seeing that our training system contributes effectively towards meeting the manpower needs of the economy. But he cannot do this alone in the Department of Employment.
  First, our training needs must be identified in detail. That will mean the closest co-operation with other Departments of State, NEDO and employers' and employees' organisations. Secondly, the Secretary of State should be able to open doors to the training facilities and resources that already abound—doors that are often closed, except to the privileged few.
  Why should we always believe that more and better training provision necessarily requires more resources and, therefore, more expenditure?
  I ask hon. Members to think of all the training resources that sit idle in their constituencies for half the day: libraries, technical colleges, polytechnics, school workshops—I do not understand why we lock up our schools so early in the day—universities, laboratories, Ministry of Defence establishments and, of course, industry.
  If we were to identify the bodies responsible for these various training resources we would find that a large proportion of them—probably most of them—came within the general area of education—both private and State—secondary, higher and further education. Therefore, local education authorities have immediate responsibility for most of those establishments.
  The Avon county council has already demonstrated how much can be done in training by co-operating with local industry and employers' organisations. Surely the Department of Education and Science is the Department most likely to succeed in gaining access to these various institutions, so that their valuable resources—usually paid for by the taxpayer—can be made available to those who need them for training purposes.
  In particular, our 33 polytechnics should have a far greater role in co-ordinating training. We have already seen what 13 of them can do in running the regional centres dealing with management training. Could they not build on that experience and widen the scope of their training activities, perhaps using the distance teaching
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  techniques perfected by the Open University to bring training courses within the reach of many workers currently denied them?
  With respect to my hon. Friend the Under-Secretary of State for Employment—the hon. Member for City of Chester (Mr. Morrison), who will be winding-up the debate and whom I congratulate on his promotion to the Front Bench—I suggest that he is in the wrong Department. What we require is a department of education and training, with a Minister of State in charge of training to co-ordinate the training activities of the nation. If my hon. Friend could persuade the Government to think in such terms he might one day find himself in that Department as the Minister of State, and not only succeed in carrying out a major reform of training but get promotion at the same time.
  Until we have a department of education and training I do not think that our training needs will be satisfactorily or economically met; nor will the dreadful divide between school and work be properly bridged.
  I ask my right hon. Friend the Secretary of State to look upon his task in training not as a cost-cutting exercise but as one of a better deployment of resources and of encouragement to employers, even in these hard times of recession, to invest more in training. We have no detailed figures of what we spend on training. Estimates put the figure at about £300,000 million—about one-third of what we spend on education—and it is almost certainly less per head of the population than our main overseas competitors.
  The Tories have always made the running on training reform. The 1964 and 1973 Acts were both Conservative measures. We do not yet have it right, but this is another opportunity to improve the system. I hope that the Bill will be one important part of the process of improvement and I commend it to the House.
  9.5 pm
  Mr. Tom McNally: The hon. Member for Bristol, North-West (Mr. Colvin) let the cat out of the bag when he asked the Secretary of State not to make the Bill a cost-cutting exercise. As has become abundantly clear, that is exactly the prospect that we are facing.
  The right hon, Gentleman tried skilfully to keep the debate on a low key. It was the bland leading the bland. However, my right hon. Friend the Member for Doncaster (Mr. Walker) quickly tore away that mask; and from the Labour, Liberal and Conservative Benches we have had a succession of Members who have criticised the Bill, its timing and its content. I am sure that the Government Whips are perspiring as they ponder on how they will be able to put a Committee together that will live up to the speeches from Back Benchers and secure votes for the Government. I do not think that that will be possible unless many amendments are made.
  We share some common interests. We recognise that Britain and its economy needs to go up market into the higher technology high value-added industries. If we are to do that, we need investment in not only equipment and new technologies but in people. In his remarkable speech my right hon. Friend the Member for Doncaster alleged that the main thrust of the Government's policies over the next few years will be to work against those aims. Although the Secretary of State has been able to make some boasts about increases in training programmes here

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  and there, the catastrophic fall in apprenticeships—10,000 in the past year—is the real monument to his policies. It is that for which he has to answer.
  As my hon. Friend the Member for Sheffield, Heeley (Mr. Hooley) said, over the next two or three years there will be many coming on to the labour market who will not be trained and who will probably never be trained. That is the opportunity that has been missed at a time when there is scope in the economy, given Government intervention, to work that out.
  It is said that firms should realise the need, but we forget how many apprenticeships are provided by small firms. I quote from a letter that was written on behalf of a small electronics firm in my constituency to the local district secretary of the AUEW:
  "We cannot continue to search for alternative employment indefinitely. It is quite clear that we will not have the resources to train four apprentices next year."
  As a result, four apprenticeships have become two apprenticeships. That is happening again and again at the small end of British industry. Four is becoming two and two is becoming none. This is not because the bosses are hard-hearted or do not have wide concepts of the needs of industry. The fact is that they have to cut to stay alive in the recession that the Government have created. That is the reality behind the rather bland performance of the Secretary of State.
  When the right hon. Gentleman looked around for support he found that it came only from the Centre for Policy Studies, with its fine record for progressive thinking. That is the only group that gives the Bill credibility. Even the CBI has said that the Bill will
  "add to the problem of maintaining standards and volume training."
  Apart from the right hon. Gentleman's brave attempt to keep the backwoodsmen from the best of the Government's training programme—the programme was one of the finest achievements of the previous Labour Government, and I pay tribute to the hon. Gentleman for fighting to maintain it—there has been retreat on all levels. That has happened at a time when we should have been searching for expansion. We are witnessing a catastrophic cutback in engineering apprenticeships and apprenticeships generally. Time and again it has been shown from the Conservative Benches and from everyone who has had practical experience of working in industry that the retreat back to voluntarism is a figleaf. Successive Governments have taken pride in the training programme. We are not saying that it is incapable of improvement, that it should be allowed to be frozen in aspic, but the challenge of productivity with existing equipment, the challenge of the new technology and the extra numbers coming on the work roll will not be met by the Bill. The debate has proved that if all hon. Members who have spoken had the courage of their convictions the Bill would proceed no further.
  9.10 pm
  Mr. Barry Jones: We have had a thorough debate. Twenty-two right hon. and hon. Members have participated. I have heard most of the speeches. They have been very thoughtful.
  I begin my remarks by sincerely congratulating the hon. Member for City of Chester (Mr. Morrison) on his appointment as Under-Secretary of State for Employment. Tonight he has made his first appearance at the Dispatch
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  Box as a Minister. It is an unusual coincidence that he and I should wind up the debate. Our constituencies share the walls of Chester and the banks of the River Dee. Perhaps there will not be another such coincidence in the House for some time.
  The Bill will, to varying degrees, dictate how Britain will fight back to a position of economic strength and industrial pre-eminence. The Bill, which is highly controversial, is presented against a depressing employment scene, as my hon. Friend the Member for Newton (Mr. Evans) was right to stress in his strong speech. There is a rapid deterioration in the labour market. The outlook for the next few years is appalling. The general consensus among economic forecasters is that unemployment will continue to rise throughout 1981 and well into 1982. Projections have shown that, without special employment programmes for the young, there will be more than 600,000 school leavers out of work in the summers of 1982 and 1983. The number of adults, who it is said, will be out of work for more than 12 months will rise from 400,000 in 1982 to 600,000 in 1983. It is easy to argue that all those estimates are far too low and that the actual figures will be much higher.
  The Secretary of State highlighted the increase in the youth opportunities programme and the increases in staffing and expenditure on them, but he has not highlighted the unjust expenditure cuts in other areas of the Manpower Services Commission's budget at a time of growing mass unemployment. We think that the Bill is a mistake, but if we view it alongside the damage that the Government are doing to employment and training services division of the MSC it can be said to be a very serious mistake. There are likely to be heavy cuts in jobcentre staffs. There are likely to be disgraceful cuts in the services for the disabled, following the International Year of Disabled People. We know that the number of ancillary staff in skillcentres will be cut and that some employment offices may have to be closed.
  My right hon. Friend the Member for Doncaster (Mr. Walker) referred to the MSC's strategy for the next five years. If the House will not accept my gloomy assessment let it consult the pages of the MSC's corporate plan. Fortuitously, after requests, a copy was placed in the Library last week. I wish to draw attention to the Manpower Services Commission's consideration of its strategy. The commission says that it has been dominated by a number of factors, one of which is that the MSC knows of the
  "requirement to save 1,710 more staff by April 1984 and to make expenditure savings of £20 million, £30 million and £30 million over the next three years."
  The MSC states:
  "This last factor has overshadowed our discussions, we are exceedingly uneasy at having to accept major reductions in the employment and training services whose main job is to help unemployed people back to work, and sustain an adequate skill base at a time when unemployment is rising sharply. We must make it clear what these reductions mean … Expenditure reductions will be gained from the saving of staff salaries of the 1,710 posts which are to go, but beyond this we see no practicable alternative but to make major expenditure savings by cutting resources available for training and rehabilitation. This of course means fewer people trained or rehabilitated."
  That point was made by my hon. Friend the Member for Manchester, Blackley (Mr. Eastham) and the hon. Member for Rochdale (Mr. Smith), and it will depress at least the hon. Member for Bedfordshire, South (Mr. Madel). The MSC continues:

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  "Staff savings will hit the employment service disproportionately: this will mean a seriously reduced capacity to aid the operation of the labour market and assist unemployed people. While the Commission welcomes the Government's approval of its special programmes for unemployed people, the reductions in its employment and training services mean that the emphasis of its services to the labour market is now being altered substantially."
  The Secretary of State's speech is, in part, invalidated by what the MSC says.
  My right hon. Friend the Member for Doncaster (Mr. Walker) pungently outlined the reasons for our dislike of the Bill. In clause 1 the Secretary of State is ruthlessly driving towards voluntarism and aiming for vastly increased powers for himself. As the hon. Member for Croydon, North-West (Mr. Taylor) said, in a blunt and independent speech, the Secretary of State wants a big blank cheque. No one in the Opposition disagrees with that assessment.
  We ask the Under-Secretary to think hard about the decision not to allow the removal of the 1 per cent. ceiling on the levy. The cost of services and training arrangements for the 13 million people who come under the industrial training boards is £52 million a year. For all the blemishes of the ITBs they are still good value at £4 per person per year.
  Does the Under-Secretary realise that there will be troublesome consequences for industry if the Government do not relent in their obstinate determination to offload on to industry the training boards' operating costs by 1982-83 at the latest? It appears to be a rather brutal decision. As the hon. Member for Rochdale said, the cut-off is far too sudden. We hope that the Under-Secretary will say that there will be a longer transitional period, as the TUC has suggested, to help industry during the terrible recession that is tightening its grip on our economy. We should look for a transitional period going up to, say, 1984–85. The Under-Secretary could do far worse than read the Employment Select Committee proceedings for last Wednesday when Lord Carr and the TUC came before the Committee. Lord Carr, a former Secretary of State for Employment, warned against adding to industry's costs in the immediate future. He emphasised strongly the damaging consequences to the financial standing of industry of the overvalued pound and the very high interest rates.
  Some hon. Members have pointed out that clause 4 excludes the employer from liability to pay levy or to provide information to a board in the case of an establishment in an enterprise zone. Enterprise zones are recent. They are controversial. Why should they mean that workers cannot benefit from industrial training measures? This proposition could be described as mean and petty. It might be said to be reactionary. We fear that it is a germinal position that signposts the Government's regression eventually to the laissez-faire industrial approaches that existed before the 1964 legislation. We want to hear in detail from the Under-Secretary the thinking behind this reactionary clause.
  There are considerable employment consequences if the boards are abolished and if the Exchequer costs are returned too speedily to industry. In the paper and paper products industry it is estimated that 80 to 150 training specialists might be lost within a year—that is up to one-third of its training corps, if what we fear with regard to
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  the abolition of many of the boards takes place. ICI, in the last quarter of 1980, suffered a £10 million loss. Its estimated increase in levy might be projected at about £600,000 a year. To make good this contribution, it would need to discharge one-third of its industrial training officers or close a number of apprenticeship schools.
  I wish to emphasise what I believe many hon. Members would say are the achievements of the industrial training boards. They have been the vehicle for tripartite approaches to training. They have become a unique system of access to companies. In many company boardrooms, training is now discussed seriously and consistently. The training boards have set standards in certain fields of training. They have become a repository of a mass of information and expertise in industrial training. Overall, they have not been proved inefficient. Overall, they are not bureaucratic. No tangible evidence about their supposed misdemeanours has been brought before the House in this debate. I believe the whole House would agree that the industrial training boards, under the sector by sector review, must expect to have to be much more flexible and to adjust to training demands in industry.
  It is clear that the Secretary of State has pinned his colours during these last few months to a threefold objective. He wants vocational preparation for employed and unemployed 16 to 18-year-olds. He wants apprenticeship reform and adult training and retraining. If he subjects his policy to the vagaries of voluntarism he is taking a big risk with his cherished objectives. If the vocational training hopes of the Government are to be realised, even at the unambitious target level set, it will be necessary for many more employers to take on young people and to provide them with a training programme that will be considerably more ambitious than that contemplated by most employers hitherto. It was on those lines that the hon. Member for Beeston (Mr. Lester), in his well-informed speech, gave a rather generous hint to the right hon. Gentleman.
  Amongst other things, the measures will require a considerable input of expertise in the development of training programmes. They will require assistance to companies and the monitoring of their performance. Is it realistic to believe that a purely voluntary system will develop the stimulus to employers to reverse the current tendency to reduce the employment of unqualified young people and to increase spending in this direction? It does not appear realistic to imagine that employers will devote resources to improve their capacity to implement quality training at this level. I do not think that it is realistic to rely on a voluntary monitoring of standards.
  Apprenticeships are regarded as a vital area. Perhaps, before considering reform, we should try to ensure that minimum numbers of future craftsmen are being trained. Further, we should ask whether it is likely that voluntary arrangements will lead to an adequate supply. It does not seem so, because even now, with the Manpower Services Commission and the industrial training boards' pressures and inducements, numbers are falling.
  Indeed, employers' apprentice recruitment has declined markedly, and apprentices in various stages of training are being sacked in large numbers. The hon. Member for Chelsea (Mr. Scott) made his points about that very effectively. He may agree with me that training, involving investment with a pay-off several years ahead, tends to be neglected, and that a voluntary system will surely do

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  nothing to overcome this serious problem. That was one of the points made by my hon. Friend the Member for Blackley.
  The subject of adult training and retraining ranges from operatives to management, and from marketing to safety. Now it is intended to open it up in an extended, more systematic and coherent way. Provisions such as the "open tech" are intended to facilitate this development. The industrial training boards' progress in this large area has been patchy in some places but it has had important successes, just as in other areas it has had its failures.
  Does the Under-Secretary think that we can contemplate with any degree of confidence the ambitious objectives now set out by the Government if their realisation depends solely on the voluntary commitment of the majority of employers? Would such a system allow us to build a national organisation through which training, experience, knowledge and expertise could be exchanged, to mutual advantage? Many of my hon. Friends ask whether there is anything in our experience in the past few decades, or more recently, to give us reason to hope that a voluntary system will deliver any more than it has in the past.
  With regard to apprenticeships, many people say that there is evidence that the Government are destroying the seedcorn. What worries me is that the past few months have seen an accelerating rush of sackings of young craftsmen and technicians in training, and that after a fall of more than 10 per cent. at the beginning of the training year compared with the previous year, this depleted source of the trained labour force of the future is now falling further to the scythe of redundancy. The investment in youngsters through one, two or even more years of training is being lost, because companies facing enormous pressures are frantically offloading their people, including many of their apprentices. In the immediate years ahead, all the signs point to a worse situation. Our experience of the decade before the 1964 Act demonstrated the futility of relying on that course, and finally persuaded the Tory Government of its futility. Another Tory Government in 1973 confirmed the necessity of statutory intervention.
  It appears that the Government are sheltering behind the sector by sector review of industrial training boards. They say "Wait and see which boards will and which boards will not be axed." Today, the Secretary of State has sought to exploit the differences of approach between the employers and others. At least his options stay open. It is not to his disadvantage that the debate has sometimes dealt with money, when it might have dealt with training. The right hon. Gentleman has confirmed that he seeks extra powers to abolish boards without a recommendation from the MSC, and that he is doing so ahead of the review. He has effectively downgraded his 23 board chairmen—as he has downgraded his Manpower Services Commission—by ignoring their pleas against voluntary boards. He still ducks the advice of the CBI, the TUC, the board chairmen and the Opposition in terms of the timing of the transference of the operating costs of the boards to industry. Today we have had only a vague promise on timing. That promise is not good enough.
  The Secretary of State is imperilling the success of his new training initiatives for the 16 to 18-year-olds by espousing the principle of voluntarism, rather than keeping to the principle of statutory provision. Some observers believe that his crucial clause 1 provision might involve a betrayal of a new generation of school leavers. In his
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  drive towards voluntarism, the Secretary of State now runs counter to the determination of two previous Conservative Governments who decided to outlaw that concept. I remind him that the Prime Minister was the sponsor of the 1973 Bill.
  In effect, we are seeing the break-up of the implied bipartisan political approach to industrial training—in basic principles at least—of the 1960s and the 1970s. Industrial training is clearly at the fulcrum of Britain's belated attempts to regenerate ts ailing economy, and now, in this crucial area of economic activity, with this reckless little Bill, the Government are embarking on bitterness and controversy. The Under-Secretary of State must answer a number of questions. The House is suspicious of the indecent haste with which the Bill has been introduced. The Government aim to push this measure through before the MSC's corporate plan comes fully into the spotlight of the House.
  It is ironic that the Secretary of State, a celebrated wet, must come to the House with a £51 million public expenditure cut—as my hon. Friend the Member for Glasgow, Maryhill (Mr. Craigen) called it—and the implied surrender of most of the statutory boards, while the greatest monetarist of all, the Secretary of State for Industry, keeps his National Enterprise Board and indulges in fortnightly rescue operations for BL and State and private steel.
  We believe strongly that a voluntary system of training boards would imperil the economic revival of our country at a time when our EEC rivals and others in the West move forward in industrial training. This Government are planning to embrace an antediluvian and discredited method.
  The Bill is the denial of the bright hopes of many of our young people. They are entitled to a better tomorrow, and some of these measures will not make that possible. We shall oppose the Bill vigorously.
  9.35 pm
  The Under-Secretary of State for Employment (Mr. Peter Morrison): I thank the hon. Member for Flint, East (Mr. Jones) for his kind congratulations, and I offer my own to him. It must be unusual for two new boys, one a Minister and the other shadowing him, to have neighbouring constituencies and to be winding up a debate on the day that they are the new boys. The difference between the hon. Member for Flint, East and me is that he has had an illustrious ministerial career, and has appeared constantly at the Dispatch Box, whereas I. four and a half years ago, took the oath of a Trappist monk: I became a Whip and, subsequent to that, the Government pairing Whip—[HON. MEMBERS: "Hear, hear."] It is unusual for a Government pairing Whip to raise a cheer. I do not think that I would have done the same a few weeks ago. However, this is my first speech in the House for four and a half years. It may be that the House will think at the end of my speech—I might even think it myself—that it would be better if I went back to my former role as a Trappist monk.
  It is ironical that as an apprentice in my new job I should be speaking about training. However, I have learned a great deal about training during the past five weeks, and I have listened carefully to all that right hon. and hon. Members have said. The backdrop to the debate has been how important training is. I think that there is no disagreement about that.

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  My hon. Friends the Members for Beeston (Mr. Lester) and for Chelsea (Mr. Scott) spoke about the youth opportunities programme, as did the right hon. Member for Doncaster (Mr. Walker) and the hon. Member for Flint, East. The issue of apprenticeships, to which the hon. Member for Flint, East referred, is another matter which has been concerning us all. It was argued that we should pursue a policy of training for adults. My right hon. Friend the Secretary of State referred to this, as did a number of other hon. Members. This is especially important since, because of the pace of change occurring in industry, it is no longer likely to be the case that a person joins a job and expects to be in that sort of job for the rest of his life.
  Mr. John Evans: Certainly not under this Government.
  Mr. Morrison: My hon. Friend the Member for Saffron Walden (Mr. Haselhurst) asked whether we should not review completely the way in which training is done. He wanted to move away from the sector by sector basis to an area committee basis. I listened carefully to my hon. Friend. Although we shall look at the issue very carefully, the fact is that, if we had area committees superimposed on the present structure, they would represent yet one more board or association.
  I am sorry that my right hon. and learned Friend the Secretary of State for Education and Science was not present when my hon. Friend the Member for Bristol, North-West (Mr. Colvin) spoke about the importance of the link between the Department of Employment and the Department of Education and Science. My right hon. and learned Friend is a very busy man. However, my hon. Friend the Member for Bristol, North-West promoted me to the job of Minister of State in my right hon. and learned Friend's Department, so perhaps he will have an opportunity to read the report of the debate in tomorrow's Hansard.
  Turning to the aspects of the Bill which were discussed in the debate, I listened especially closely to what the right hon. Member for Doncaster said. The whole House appreciates that his knowledge of these matters is very deep and that his experience goes back over many years—and it is a many years. His knowledge and experience is very substantial and, therefore, I always pay an enormous amount of attention to what he says.
  My hon. Friend the Member for Saffron Walden mentioned the following point. I got the impression that the right hon. Member for Doncaster was a little wary of change. Perhaps that is not right, but that was the impression he gave. As I said to him in answer to a parliamentary question, it is surprising that he should be wary of change as a Labour Front Bencher and that I as a Conservative Front Bencher should be promoting change. Perhaps I misunderstood him.
  Last November, Len Murray said:
  "The need now is to reach agreement on a framework of a training system for all in the future, to develop a system which meets the training needs of workers, employers and the nation during a period of economic difficulty and rapid technological change".
  Therefore, Mr. Murray is in agreement with my right hon. Friend and myself, and is disagreeing to a certain extent with the hon. Member for Newton (Mr. Evans), who suggested that we were going too fast, as did other Opposition Members.
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  Mr. Murray realises how important it is to settle this matter, because we need the structure for the future. Opposition Members appear to say that it is not important to settle the matter. Therefore, they are continuing to promote uncertainty.
  Mr. John Evans: Surely the Minister has recognised our arguments that the Government should wait until the MSC has conducted its review, that the House should have a debate on the review and that, after that debate, legislation could be brought to the House which would be uncontroversial and accepted by both sides of the House?
  Mr. Morrison: I shall come to that point later in my speech. I am not fobbing off the question.
  I gather that the interesting thing is—admittedly the right hon. Member for Doncaster mentioned it—that the Opposition, the TUC and the Conservatives are all agreed that, at the end of the day, industry should pay for its training. The TUC said that at the Employment Select Committee last week, the right hon. Gentleman said it and we are saying it now. I accept that there is some contention as to when that should come.
  The right hon. Member for Norwich, North (Mr. Ennals) raised the theme of whether employers can afford to pay. I believe that we should consider it in this way. At the moment, 47 per cent. of employees are not covered by training boards. After the review by the Manpower Services Commission and any decision which my right hon. Friend may make, that figure may increase. If it is increased, those companies that are left within the statutory boards will have to pay for the operating costs, whereas those within the voluntary system will have to pay for something—because there will be some things on a voluntary basis—but they will not have to pay the costs as determined by the industrial training board of that sector. Therefore, the voluntary and the statutory sectors are being put at odds with each other.
  I agree with my hon. Friend the Member for The Wrekin (Mr. Hawksley) that it is likely that, where there is a voluntary board or a voluntary association, because the same form filling and bureaucracy will not exist, the operating costs are likely to be less. However, in relation to transfer costs and the points made by my hon. Friend the Member for Beeston and the right hon. Member for Doncaster, my right hon. Friend the Secretary of State and I have accepted that things will be difficult for industries during the present recession. My right hon. Friend said that he was prepared to be reasonably flexible. It would therefore be unjust and wrong to say that we have not taken account of this matter.
  Many hon. Members have asked what role the training boards have played over the last 16 or 17 years. The right hon. Member for Doncaster rightly talked at some length about the Acts of 1964 and 1973. He called in evidence my noble Friend Lord Blakenham, and said that he would disagree with what we are doing. However, I think that it would be fair to say that what pertained in 1963–64 does not necessarily pertain in 1981–82. I accept what the right hon. Gentleman also said, that his noble Friend Lord Scanlon said that the training boards had played an important role.
  I accept that, as a result of the boards, some sectors have woken up to what was going on and taken remedial action, but that does not necessarily mean that they should continue for ever and a day. However, they played an

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  important role and I echo the thanks expressed by the Secretary of State to all those involved in their work. They have done a marvellous job over the years.
  I understand that the TUC wants the boards to continue for evermore and I accept that employers are divided. Sitting at my desk, I receive many letters—not as many as the hon. Member for Hackeney, South and Shoreditch (Mr. Brown) suggested but certainly quite a few—arguing both sides of the case. Some employers want them to go on because they regard them as of great assistance. Others want them to stop because they regard them as bureaucratic, expensive and time-consuming.
  I should not let pass the point made in the letter from the chairmen of the training boards. I should be amazed if any group whose organisation was being threatened did not write to say "We do not believe that you should get rid of us." I should be staggered if that were not so. But the chairmen are responsible to their public, to their industries, as we politicians are responsible to our electors. So we must listen not just to them but to the employers in the industries concerned. That is the reason for the review.
  I felt rather lost at one point in the speech of the right hon. Member for Doncaster. He seemed at first to be on land and then to divert to the sea. He said that everything in the garden was not rosy with training—
  Mr. Harold Walker indicated dissent.
  Mr. Morrison: That is what he said. Then he said that a touch on the tiller might be helpful. I must confess that I was a little at sea about his meaning.
  It is wrong to suggest that we are making a pre-emptive strike. We have open minds. My hon. Friend the Member for Beeston asked for an undertaking that we do not have a doctrinaire approach. I can certainly give that undertaking.
  The right hon. Member for Doncaster suggested that the Government are in conflict with the MSC. I am not aware of such a conflict. I am sure that he will agree that the MSC has not come forward with any recommendations for the sector-by-sector review of whether the boards should continue. I find it surprising that he is taking that line when in Committee on 12 April 1973 he argued the opposite. I could quote what he said then, but I do not wish to bore the House. He argued that it was important that the House had powers over the MSC to take action without its recommendations. Now, eight years later, he is arguing the opposite.
  Mr. Harold Walker: Will the Minister please quote that passage so that the House knows what I said?
  Mr. Morrison: I shall do so. The right hon. Gentleman said:
  "One of the fundamental issues of the Bill is the extent to which the powers of Members of Parliament have been eroded and will be eroded in the future. It is our duty to ensure that power remains ultimately with Ministers and the vote of Parliament and subject to the pressures of Parliament. It may be that, under pressure, Parliament is compelled to make the wrong decisions, but, if they are wrong decisions as the result of democratic pressures, they are right decisions in terms of parliamentary democracy. This is the system we have developed and I am concerned that we should not hand over to agencies the kind of powers that the Minister is proposing that they should have."— [Official Report, Standing Committee A, 12 April 1973; c. 344.]
  That is the argument that I am putting forward tonight.
  Mr. Harold Walker: With respect, that is not what the Bill is saying. I argued then, and have argued since—I
  688
  have never resiled from the argument—that the MSC or any other extra-governmental agency should be accountable to the Minister, and through the Minister to the House. The power ultimately should rest with the House. The Secretary of State is now taking power to override and dismiss the views of the MSC. That is what the Bill is about. If the position were otherwise, there would be no need for the Bill.
  Mr. Morrrison: The right hon. Gentleman and I will not agree on that point. My right hon. Friend is taking powers to do exactly what the right hon. Gentleman wanted in 1973.
  Mr. John Golding: I want to move slightly away from that point. Surely the bone of contention for Back Benchers is that both the CBI and the TUC have said that they cannot make a firm recommendation about the Bill until the MSC has completed its inquiry. They have said that they cannot hold meaningful discussions on the principles of the Bill until the review has taken place. In that sense, my right hon. Friend the Member for Doncaster (Mr. Walker) is right to say that the partners in the MSC believe that this is the wrong time to discuss the Bill, and that discussions should take place only when we are better informed.
  Mr. Morrison: I am sure that the right hon. Member for Doncaster will be grateful to his hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding) for getting away from the point. The TUC, the CBI and any interested body, are entitled to talk to the MSC before it makes its recommendations, and also to talk to my right hon. Friend, myself or any other Minister if they so desire. I do not think that the hon. Gentleman and I will agree on that point.
  I turn to the question of the levy—that is, the non-clause which the right hon. Gentleman wanted included in the Bill. It is still possible, and it will remain possible, for a training board to bring a proposed increase of levy over 1 per cent. to my right hon. Friend, and it will then be subject to affirmative resolution. What the Opposition apparently want is for statutory training boards to have a blank cheque. I suggest that that, overall, is where taxpayers' money gets lost—when we give blank cheques to people.
  I come to the final and most important point of all. It has been raised by many hon. Members on both sides of the House. The question is: can voluntarism work? I accept entirely that one cannot be utterly sure whether voluntarism can work, but, as a general rule, my right hon. and hon. Friends and I believe that the British people are far better at organising themselves than the Government are on their behalf.
  But of course, in the event of the review and of recommendations made to him, my right hon. Friend will take into account, when he decides whether a training board should continue, whether he thinks that the particular industry can continue on a voluntary basis.
  The point which hon. Members on both sides of the House are making is well registered, but overall, I think that Opposition Members simply cannot take on board the fact that voluntarism can work when, in fact, it works. I say to the right hon. Member for Doncaster that, as he well knows and knew well before me, the ITBs, when set up under the 1964 Act, were set up on the model of the

  689
  Merchant Navy Training Board—I am assured that that is correct—which has always been a totally voluntary body. So in that case it has worked, and I do not see why it should not work in the future.
  I turn finally to the hon. Member for Rochdale (Mr. Smith). He was kind enough to flatter me, because he wanted me to do something in his constituency, but then he proceeded to insult me.
  Mr. Cyril Smith: Impossible.
  Mr. Morrison: It seems to me that the hon. Gentleman wanted it both ways. First, he said that he wanted all small firms exempt. He said that it was monstrous that small firms were being mucked around by these training boards and that this was another of these desperate things that the Government were doing. One would have assumed from that point of view that the hon. Gentleman did not particularly like training boards. But then he said that we must keep the Cotton and Allied Textiles Training Board, which looks after a lot of small firms. So at that moment the hon. Gentleman was looking both ways.
  I accept that there is no harm in a prominent member of the Liberal Party looking both ways, but the rest of us have to look the same way.
  Mr. Cyril Smith: Will the Minister give way?
  Mr. Morrison: No, I cannot give way. It is very near 10 o'clock.
  The hon. Gentleman talked about the reduction in the retiring age for men, which was not particularly germane to this point. I draw his attention to the fact that the Government have the job release scheme, and with that scheme that is exactly what we have.
  Mr. Cyril Smith Mr. Cyril Smith rose—
  Mr. Morrison: Finally, the hon. Gentleman attacked enterprise zones. We shall notice in future that the Liberal Party is opposed to enterprise and enterprise zones. We shall mark it down. That is the sort of party it is.
  I ask my right hon. and hon. Friends to join me in the Lobby and vote for the Second Reading of the Bill.
  Mr. Cyril Smith: I was trying to explain to the Minister—
  The Parliamentary Secretary to the Treasury (Mr. Michael Jopling)The Parliamentary Secretary to the Treasury (Mr. Michael Jopling)rose in his place and claimed to move, That the Question be now put.
  Question, That the Question be now put, put and agreed to.
  Question put accordingly, That the Bill be now read a Second time:—
  The House divided: Ayes 299, Noes 248.

  Division No.65]

  [10 pm

  Alexander,Richard

  Benyon,Thomas(A 'don)

  Amery, Rt HonJulian

  Benyon,W. (Buckingham)

  Ancram,Michael

  Berry, HonAnthony

  Arnold,Tom

  Best, Keith

  Atkins, Robert(PrestonN)

  Bevan, David Gilroy

  Atkinson, David(B'm'th,E,)

  Biffen,Rt Hon John

  Baker,Kenneth(Sf. M'bone)

  Biggs-Davison,John

  Baker, Nicholas (NDorset)

  Blackburn, John

  Banks, Robert

  Body, Richard

  Beaumont-Dark,Anthony

  Bonsor, SirNicholas

  Bendall, Vivian

  Boscawen, HonRobert

  Bennett, SirFrederic(T'bay)

  Bottomley, Peter(W'wichW)

  690

  Bowden, Andrew

  Haselhurst, Alan

  Boyson, DrRhodes

  Hastings, Stephen

  Braine, SirBemard

  Havers, Rt Hon Sir Michael

  Bright, Graham

  Hawkins, Paul

  Brinton, Tim

  Hawksley, Warren

  Brittan, Leon

  Hayhoe, Barney

  Brooke, Hon Peter

  Heath, Rt Hon Edward

  Brotherton, Michael

  Heddle, John

  Bruce-Gardyne, John

  Henderson, Barry

  Bryan, Sir Paul

  Heseltine, Rt Hon Michael

  Buck, Antony

  Hicks, Robert

  Budgen, Nick

  Higgins, Rt Hon Terence L.

  Bulmer, Esmond

  Hill, James

  Burden, SirFrederick

  Hogg, Hon Douglas(Gr'th'm)

  Butcher, John

  Holland, Philip (Carlton)

  Carlisle, John (LutonWest)

  Hooson, Tom

  Carlisle, Kenneth(Lincoln)

  Hordern, Peter

  Carlisle, Rt Hon M. (R'c'n)

  Howe, Rt Hon Sir Geoffrey

  Chalker, Mrs. Lynda

  Howell, Rt Hon D. (G'ldf'd)

  Channon, Rt. Hon. Paul

  Howell, Ralph (NNorfolk)

  Chapman, Sydney

  Hunt, David (Wirral)

  Churchill, W.S.

  Hunt, John(Ravensbourne)

  Clark, Hon A. (Plym'th,S'n)

  Hurd, Hon Douglas

  Clark, Sir W. (Croydon S)

  Irving, Charles(Cheltenham)

  Clarke, Kenneth(Rushcliffe)

  Jenkin, Rt Hon Patrick

  Clegg, Sir Walter

  Jessel, Toby

  Cockeram, Eric

  Johnson Smith, Geoffrey

  Colvin, Michael

  Jopling, Rt Hon Michael

  Cope, John

  Joseph, Rt Hon Sir Keith

  Cormack, Patrick

  Kaberry, Sir Donald

  Corrie, John

  Kershaw, Anthony

  Costain, Sir Albert

  Kimball, Marcus

  Cranborne, Viscount

  King, Rt Hon Tom

  Critchley, Julian

  Kitson, Sir Timothy

  Crouch, David

  Knight, Mrs Jill

  Dean, Paul (North Somerset)

  Knox, David

  Dorrell, Stephen

  Lamont, Norman

  Dover, Denshore

  Lang, Ian

  du Cann, Rt Hon Edward

  Langford-Holt, Sir John

  Dunn, Robert(Dartford)

  Latham, Michael

  Dykes, Hugh

  Lawrence, Ivan

  Eggar, Tim

  Lawson, Rt Hon Nigel

  Elliott, Sir William

  Lee, John

  Emery, Peter

  LeMarchant, Spencer

  Eyre, Reginald

  Lennox-Boyd, HonMark

  Fairbairn, Nicholas

  Lester Jim (Beeston)

  Fairgrieve, Russell

  Lewis, Kenneth(Rutland)

  Faith, Mrs Sheila

  Lloyd, Ian (Havant & W'loo)

  Farr, John

  Loveridge, John

  Fell, Anthony

  Luce, Richard

  Fenner, Mrs Peggy

  Lyell, Nicholas

  Finsberg, Geoffrey

  McCrindle, Robert

  Fisher, Sir Nigel

  Macfarlane, Neil

  Fletcher, A.(Ed'nb'gh N)

  MacGregor, John

  Fletcher-Cooke, Sir Charles

  MacKay, John (Argyll)

  Fookes, MissJanet

  McNair-Wilson,M.(N'bury)

  Forman, Nigel

  McNair-Wilson, P.(New F'st)

  Fowler, Rt Hon Norman

  McQuarrie Albert

  Fox, Marcus

  Madel, David

  Fraser, Peter (South Angus)

  Major, John

  Fry, Peter

  Marland, Paul

  Gardiner, George(Reigate)

  Marlow, Tony

  Gardner, Edward (S Fylde)

  MarshallMichael(Arundel)

  Garel-Jones, Tristan

  Marten, Neil(Sanbury)

  Gilmour, Rt Hon Sir Ian

  Mates, Michael

  Glyn, Dr Alan

  Mather, Carol

  Goodhart, Philip

  Maude, Rt Hon Sir Angus

  Gorst, John

  Mawby, Ray

  Grant, Anthony (HarrowC)

  Mawhinney, Dr Brian

  Gray, Hamish

  Maxwell-Hyslop, Robin

  Greenway, Harry

  Mayhew, Patrick

  Griffiths, E.(B'ySt. Edm'ds)

  Mellor, David

  Griffiths, Peter Portsm'thN)

  Meyer, Sir Anthony

  Grist, Ian

  Miller, Hal(B'grove)

  Grylls, Michael

  Mi I Is, lain (Meriden)

  Gummer, JohnSelwyn

  Mills, Peter (West Devon)

  Hamilton, Hon A.

  Miscampbell, Norman

  Hamilton, Michael(Salisbury)

  Moate, Roger

  Hampson, Dr Keith

  Monro, Hector

  Hannam, John

  Montgomery, Fergus

  691

  Moore, John

  Smith, Dudley

  Morgan, Geraint

  Speller, Tony

  Morris, M. (N'hamptonS)

  Spence, John

  Morrison, Hon C. (Devizes)

  Spicer, Jim (West Dorset)

  Morrison, Hon P.(Chester)

  Spicer, Michael(S Worcs)

  Mudd, David

  Sproat, Ian

  Murphy, Christopher

  Squire, Robin

  Myles, David

  Stainton, Keith

  Needham, Richard

  Stanbrook, Ivor

  Nelson, Anthony

  Stanley, John

  Neubert, Michael

  Steen, Anthony

  Newton, Tony

  Stevens, Martin

  Nott, Rt Hon John

  Stewart, Ian (Hitchin)

  Onslow, Cranley

  Stewart, A. (ERenfrewshire)

  Oppenheim, Rt Hon Mrs S.

  Stokes, John

  Osborn, John

  Stradling Thomas, J.

  Page, John (Harrow, West)

  Tapsell, Peter

  Page, Rt Hon Sir G. (Crosby)

  Taylor, Robert(Croydon NW)

  Page, Richard (SW Herts)

  Taylor, Teddy (S'end E)

  Parris, Matthew

  Tebbit, Norman

  Patten, Christopher(Bath)

  Temple-Morris, Peter

  Patten, John(Oxford)

  Thomas, Rt Hon Peter

  Pattie, Geoffrey

  Thompson, Donald

  Pawsey, James

  Thorne, Neil(Ilford South)

  Percival, Sirlan

  Thornton, Malcolm

  Peyton, Rt Hon John

  Townend, John(Bridlington)

  Pink, R. Bonner

  Townsend, Cyril D, (B'heath)

  Pollock, Alexander

  Trippier, David

  Porter, Barry

  Trotter, Neville

  Prentice, Rt Hon Reg

  van Straubenzee, W. R.

  Price, Sir David (Eastleigh)

  Vaughan, Dr Gerard

  Prior, Rt Hon James

  Viggers, Peter

  Proctor, K. Harvey

  Waddington, David

  Pym, Rt Hon Francis

  Wakeham, John

  Raison, Timothy

  Waldegrave, Hon William

  Rathbone, Tim

  Walker, B. (Perth)

  Rees, Peter (Dover and Deal)

  Walker-Smith, Rt Hon Sir D.

  Rees-Davies, W. R.

  Wall, Patrick

  Renton, Tim

  Waller, Gary

  Rhodes James, Robert

  Walters, Dennis

  Rhys Williams, Sir Brandon

  Ward, John

  Ridley, Hon Nicholas

  Warren, Kenneth

  Rippon, Rt Hon Geoffrey

  Watson, John

  Roberts, M. (Cardiff NW)

  Wells, John(Maidstone)

  Roberts, Wyn(Conway)

  Wells, Bowen

  Rossi, Hugh

  Wheeler, John

  Rost, Peter

  Whitelaw, Rt Hon William

  Sainsbury, Hon Timothy

  Whitney, Raymond

  St. John-Stevas, Rt Hon N.

  Wickenden, Keith

  Scott, Nicholas

  Wiggin, Jerry

  Shaw, Giles (Pudsey)

  Wilkinson, John

  Shaw, Michael (Scarborough)

  Williams, D.(Montgomery)

  Shelton, William(Streatham)

  Winterton, Nicholas

  Shepherd, Colin (Hereford)

  Wolfson, Mark

  Shepherd, Richard

  Young, Sir George(Acton)

  Shersby, Michael

  Silvester, Fred

  Tellers for the Ayes:

  Sims, Roger

  Lord James Douglas-Hamilton

  Skeet, T. H. H.

  and Mr. Alastair Goodlad.

  NOES

  Abse, Leo

  Brown, Hugh D. (Provan)

  Adams, Allen

  Brown, R. C. (N'castle W)

  Allaun, Frank

  Brown, Ron(E'burgh, Leith)

  Alton, David

  Brown, Ronald W. (H'ckn'y S)

  Anderson, Donald

  Buchan, Norman

  Archer, Rt Hon Peter

  Callaghan, Jim(Midd't'n&P)

  Ashley, Rt Hon Jack

  Campbell, Ian

  Ashton, Joe

  Campbell-Savours, Dale

  Atkinson, N.(H'gey,)

  Canavan, Dennis

  Bagier, Gordon A.T.

  Cant, R. B.

  Barnett, Guy(Greenwich)

  Carmichael, Neil

  Barnett, Rt Hon Joel(H'wd)

  Carter-Jones, Lewis

  Benn, Rt Hon A. Wedgwood

  Cartwright, John

  Bennett, Andrew(St'kp'tN)

  Clark, Dr David (S Shields)

  Bidwell, Sydney

  Cocks, Rt Hon M. (B'stol S)

  Booth, Rt Hon Albert

  Cohen, Stanley

  Boothroyd, Miss Betty

  Coleman, Donald

  Bradley, Tom

  Concannon, Rt Hon J. D.

  Bray, Dr Jeremy

  Conlan, Bernard

  692

  Cowans, Harry

  Johnson, James (Hull West)

  Cox, T.(W'dsw'th, Toot'g)

  Johnson, Walter(Derby S)

  Craigen, J. M.

  Jones, Rt Hon Alec (Rh'dda)

  Crowther, J. S.

  Jones, Barry (East Flint)

  Cunliffe, Lawrence

  Jones, Dan (Burnley)

  Cunningham, G.(Islington S)

  Kaufman, Rt Hon Gerald

  Cunningham, Dr J.(W'h'n)

  Kerr, Russell

  Dalyell, Tam

  Kilroy-Silk, Robert

  Davies, Rt Hon Denzil (L'lli)

  Kinnock, Neil

  Davis, Clinton (Hackney C)

  Lambie, David

  Davis, T.(B'ham, Stechf'd)

  Lamborn, Harry

  Deakins, Eric

  Lamond, James

  Dean, Joseph (Leeds West)

  Leadbitter, Ted

  Dewar, Donald

  Lewis, Arthur (N'ham NW)

  Dixon, Donald

  Lewis, Ron(Carlisle)

  Dobson, Frank

  Litherland, Robert

  Dormand, Jack

  Lofthouse, Geoffrey

  Douglas, Dick

  Lyon, Alexander (York)

  Douglas-Mann, Bruce

  Lyons, Edward (Bradf'dW)

  Dubs, Alfred

  Mabon, Rt Hon Dr J. Dickson

  Duffy, A. E. P.

  McDonald, DrOonagh

  Dunn, James A.

  McGuire, Michael(Ince)

  Dunnett, Jack

  McKay, Allen(Penistone)

  Dunwoody, Hon Mrs G.

  MacKay, John(Argyll)

  Eastham, Ken

  McKelvey, William

  Edwards, R. (W'hampt'n S E)

  MacKenzie, Rt Hon Gregor

  Ellis, R. (NE D'bysh're)

  Maclennan, Robert

  Ellis, Tom (Wrexham)

  McMahon, Andrew

  English, Michael

  McNally, Thomas

  Ennals, Rt Hon David

  McTaggart, Robert

  Evans, loan (Aberdare)

  McWilliam, John

  Evans, John (Newton)

  Magee, Bryan

  Ewing, Harry

  Marks, Kenneth

  Field, Frank

  Marshall, D (G'gowS'ton)

  Fitch, Alan

  Marshall, Dr Edmund(Goole)

  Flannery, Martin

  Mason, Rt Hon Roy

  Fletcher, Raymond (Ilkeston)

  Maxton, John

  Fletcher, Ted (Darlington)

  Maynard, Miss Joan

  Foot, Rt Hon Michael

  Meacher, Michael

  Ford, Ben

  Mellish, Rt Hon Robert

  Forrester, John

  Millan, Rt Hon Bruce

  Foster, Derek

  Miller, Dr M. S. (E Kilbride)

  Foulkes, George

  Mitchell, Austin(Grimsby)

  Fraser, J. (Lamb'th, N'w'd)

  Mitchell, R.C. (Soton Itchen)

  Freeson, Rt Hon Reginald

  Morris, Rt Hon A. (W'shawe)

  Freud, Clement

  Morris, Rt Hon C. (O'shaw)

  Garrett, John (Norwich S)

  Morris, Rt Hon J. (Aberavon)

  Garrett, W. E. (Wallsend)

  Morton, George

  George, Bruce

  Moyle, Rt Hon Roland

  Gilbert, Rt Hon Dr John

  Mulley, Rt Hon Frederick

  Ginsburg, David

  Newens, Stanley

  Golding, John

  Oakes, Rt Hon Gordon

  Gourlay, Harry

  Ogden, Eric

  Graham, Ted

  O'Neill, Martin

  Grant, George(Morpeth)

  Orme, Rt Hon Stanley

  Grant, John (Islington C)

  Park, George

  Hamilton, James(Bothwell)

  Parker, John

  Hamilton, W. W. (C'tral Fife)

  Parry, Robert

  Hardy, Peter

  Pavitt, Laurie

  Harrison, Rt Hon Walter

  Pendry, Tom

  Hart, Rt Hon Dame Judith

  Penhaligon, David

  Hattersley, Rt Hon Roy

  Powell, Raymond(Ogmore)

  Haynes, Frank

  Prescott, John

  Healey, Rt Hon Denis

  Price, C. (Lewisham W)

  Heffer, Eric S.

  Race, Reg

  Hogg, N. (EDunb't'nshire)

  Radice, Giles

  Holland, S.(L'b'th, Vauxh'll)

  Rees, Rt Hon M (Leeds S)

  Home Robertson, John

  Richardson, Jo

  Homewood, William

  Roberts, Albert (Normanton)

  Hooley, Frank

  Roberts, Allan(Bootle)

  Horam, John

  Roberts, Ernest (Hackney N)

  Howell, Rt Hon D.

  Roberts, Gwilym(Cannock)

  Huckfield, Les

  Robertson, George

  Hudson Davies, Gwilym E.

  Robinson, G. (Coventry NW)

  Hughes, Mark(Durham)

  Rodgers, Rt Hon William

  Hughes, Robert (Aberdeen N)

  Rooker, J. W.

  Hughes, Roy (Newport)

  Roper, John

  Janner, Hon Greville

  Ross, Ernest (Dundee West)

  Jay, Rt Hon Douglas

  Ross, Stephen (Isle of Wight)

  John, Brynmor

  Rowlands, Ted

  693

  Ryman, John

  Steel, Rt Hon David

  Sandelson, Neville

  Stoddart, David

  Sever, John

  Stott, Roger

  Sheerman, Barry

  Strang, Gavin

  Sheldon, Rt Hon R.

  Straw, Jack

  Shore, Rt Hon Peter

  Summerskill, Hon Dr Shirley

  Short, Mrs Renée

  Taylor, Mrs Ann (Bolton W)

  Silkin, Rt Hon J. (Deptford)

  Thomas, Dafydd (Merioneth)

  Silkin, Rt Hon S. C. (Dulwich)

  Thomas, Jeffery (Abertillery)

  Silverman, Julius

  Thomas, Mike (Newcastle E)

  Skinner, Dennis

  Thomas, Dr R. (Carmarthen)

  Smith, Cyril (Rochdale)

  Thorne, Stan (Preston South)

  Smith, Rt Hon J. (N Lanark)

  Tilley, John

  Snape, Peter

  Tinn, James

  Soley, Clive

  Torney, Tom

  Spriggs, Leslie

  Varley, Rt Hon Eric G.

  Stallard, A. W.

  Wainwright, E(Dearne V)

  694

  Walker, Rt Hon H.(D'caster)

  Wilson, Gordon (Dundee E)

  Watkins, David

  Wilson, Rt Hon Sir H(H'ton)

  Weetch, Ken

  Wilson, William (C'trySE)

  Welsh, Michael

  Winnick, David

  White, Frank R.

  Wrigglesworth, Ian

  White, J. (G'gow Pollok)

  Young, David (Bolton E)

  Whitehead, Phillip

  Whitlock, William

  Tellers for the Noes:

  Wigley, Dafydd

  Mr. Hugh McCartney and

  Williams, Rt Hon A.(S'sea W)

  Mr. Ron Leighton.

  Williams, Sir T.(W'ton)

  Question accordingly agreed to.
  Bill read a Second time.
  Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).

  BUSINESS OF THE HOUSE
  Ordered,
  That, at this day's sitting, the Motion relating to Ways and Means may be proceeded with, though opposed, until any hour and the Motion relating to Public Health may be proceeded with, though opposed, until half-past Eleven o'clock.—[Mr. Thompson.]

  WAYS AND MEANS
  EMPLOYMENT AND TRAINING
  Resolved,
  That, for the purposes of any Act of the present Session to amend the Industrial Training Act 1964 and to provide for the retention of receipts by certain bodies, it is expedient to authorise the payment into the Consolidated Fund of any sums received by those bodies which they are not authorised under that Act to retain.—[Mr. Peter Morrison.]

  Toxic Waste Disposal
  10.13 pm
  Mr. Denis Howell: I beg to move,
  That an humble Address be presented to Her Majesty, praying that the Control of Pollution (Special Waste) Regulations 1980 (S.I., 1980, No. 1709), dated 30 October 1980, a copy of which was laid before this House on 17 November 1980 in the last Session of Parliament, be revoked.
  Mr. Arthur Lewis: On a point of order, Mr. Deputy Speaker. Will you ask the mass meeting of speakers to leave the House so that we can hear what is happening? Perhaps they could hold their meeting outside.
  Mr. Deputy Speaker (Mr. Bryant Godman Irvine): It would be convenient for those who want to hear the right hon. Gentleman if conversations could be continued elsewhere.
  Mr. Howell: It is difficult to overstate the importance of this subject. For about 10 years there has been mounting concern about the dangers of toxic waste. Deaths have. occurred, communities have felt threatened and public anxiety has forced Government to act. As a result, Parliament has imposed a system of rigid controls, which have proved to be successful and in which the public have confidence.
  Why is all that to be put at risk by the new regulations? Who is the genius who says "We have a system that is working well, so we shall change it"? The local authorities do not take that view. With almost unprecedented unanimity they have condemned the proposals as dangerous and unworkable—and they are the ones who have to try to work them.
  It seems that the pressure has come from the CBI. I am sorry about that, because when I was the Minister responsible for these matters I worked closely with CBI advisers. However, the CBI has persuaded the Government that the new system will produce a saving in paper work and administration, although many in the trade and most local authorities do not agree with that. In my judgment, when dealing with poisonous wastes the last of all considerations should be savings in administration and paperwork.
  Our assessment is that Environment Ministers have surrendered to Industry Ministers. They have abandoned
  696
  their responsibility for care of the environment. They are proposing a system that is unworkable in practice. For example, staff of the highest qualifications will be necessary, and such persons are not available. The criteria imposed in these regulations by which danger is to be measured are so ludicrous as almost to bring the Government in contempt.
  The history of these matters in recent years resulted in emergency legislation being rushed through the House with the agreement of both sides of the House. That resulted in the Deposit of Poisonous Waste Act 1972. That legislation followed the irresponsible behaviour of some cowboys in industry in dumping toxic waste without permission and without regard to public safety. On that occasion the House acted with commendable urgency. We recall the incidents that led to that decision, especially the problems at the Nuneaton tip, where dumping was taking place.
  It is interesting to note that in 1972 the Royal Commission on pollution was consulted. It regarded the matter as so urgent that it advised the Government of the day that it was proposing to bring out its proposals in 1974 but felt that the issue was so urgent that it could not wait until 1974, and advised the Government to act. So indecent has been the speed with which the Government want to get the regulations on the statute book that on this occasion the Royal Commission has not been consulted.
  Mr. Ted Graham: Shame.
  Mr. Howell: That gives us a measure of the seriousness of the proposals that are under consideration. Under the 1972 Act the quantity or concentration of waste that might constitute a serious hazard to life, health or the environment was controlled. Waste disposal authorities had the power to decide whether such a hazard existed. It worked through a system of notification. First, there was notification to the authority where the waste arose. Secondly, there was notification to the waste and water authorities where the waste was disposed of. Thirdly, there was notification to those finally responsible within the trade for the disposing of the waste. All these notifications had to be made—that is still the requirement—in advance of any movement of waste from one area to another.
  The Government are proposing to change that situation, which has given the public a degree of comfort and relief that toxic waste problems are now under control.
  In 1974 it was my responsibility to pilot the Control of Pollution Act through the House. I regret to say that that Act has still not yet been fully implemented. Under section 2 waste disposal authorities are required to survey and draw up a plan for the disposal of toxic waste. I am sorry to say that those proposals are to be undermined by the Local Government Act 1980 and by the new regulations. Most local authorities have not completed their surveys for the disposal of toxic wastes. Indeed, some have not begun. The requirement to survey and produce a waste disposal plan is jeopardised by the present proposals.
  Furthermore, the EEC attaches enormous importance to the matter. I shall return to that later, because, as the responsible Minister, I had to attend meeting after meeting in Brussels to reach agreement. There was unanimous agreement among member countries about the way in which toxic wastes should be disposed of and what rigid control there should be.
  It is not surprising that local authorities that have been advising hon. Members about the regulations are totally

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  and unitedly expressing grave concern about the effects of the proposals. First, they say that any savings on paperwork that the Government are seeking to achieve will be offset many times over by the costs of the toxicological expertise that will be required when the authorities have to dispose of wastes. Furthermore, quite apart from the costs of such experts, they tell us thaat the experts do not exist in sufficient numbers to advise local authorities of the seriousness of the proposals before them.
  Local authorities also tell us that under the regulations the disposal authoritiy for an area where the waste is produced is given the responsibility to ensure that the new consignment note procedure operates correctly. But the local authority where the waste arises is no longer entitled to receive prior notificaton of the dispatch of waste from its own area to another area. How daft can such a procedure become, if that local authority has the responsibility without the knowledge with which to operate that responsibility?
  Many examples have been given to Ministers and hon. Members about the risks that will be involved under the new procedures. Between 60 per cent. and 70 per cent. of the toxic wastes that are now rightly controlled will be excluded from specific control. That is the measure of the risk to which the country is being put by the regulations.
  We have been given many examples. Mercury waste—which is responsible for causing a serious disease in Japan— will be outside the scope of the regulations. Sludges from the chlor-alkali industry, the nature of which can be changed, by the presence of bacteria, into methyl mercury, will also cease to be within the scope of the regulations. Bog ore, which emanates from old gas works and which deteriorates in rain, sterilising the ground around it and, even worse, producing acid leachate, which kills all known stream life, is another hazard that we face as a result of the regulations. A relatively dilute acid combined with a sulphide can produce a lethal chemical—hydrogen sulphide—which the House may recall was responsible for killing a tanker driver at an Essex pit.
  Three months ago, when a Department of the Environment spokesman addressed a West Midlands business men's seminar, the West Midlands county council, the responsible authority, wished to attend, but was not invited to do so. The responsible chief officer of the authority still does not know whether some of the constituent elements about which he is worried are included or excluded.
  The Greater London Council has drawn attention to three dangers. Lithium batteries, which are small batteries, are excluded from control by the regulations. They will not be in the special waste category, but when water is applied to those batteries they can become a fire risk. One can imagine the hazards that will be created if such batteries are dumped.
  Sodium street lamps have to be disposed of by many local authorities. They can be dangerous when smashed, unless disposal is well supervised. Yet they are also excluded. The GLC has also told us of its considerable concern about quantities of mixtures of oil and water.
  It is no wonder that every professional organisation, including the Institute of Municipal Engineers, the Institue of Solid Waste Management and the National Association of Waste Disposal Contractors, and environmental
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  organisations such as Friends of the Earth, either oppose or have strong reservations about the regulations. In addition, every local authority in the country opposes the regulations.
  Mr. J. W. Rooker: The Minister is laughing.
  Dr. Oonagh McDonald: It is a disgrace.
  Mr. Howell: It would be better if the regulations were withdrawn, so that the Government could have further consultations.
  I received today a statement by the clerk of the Derbyshire county council about the effects of the regulations. He says:
  "The likely result will be that poisonous or polluting waste will be illegally deposited at more sites within the county and site operators facing a lesser risk of prosecution."
  The House cannot possibly view that situation with equanimity.
  One of the most respected waste disposal officers in the country, the officer of the West Midlands county council, has said that if the regulations are applied unamended:
  "We shall all wait for the first disaster."
  If such a disaster occurs after years when we thought we had the situation under control, the Government will carry a heavy responsibility.
  I turn to the care of the environment, which is a matter of great concern. Throughout my time as the responsible Minister in the Department of the Environment we had two priorities—protection of health and protection of the environment. The EEC regulation to which we are committed embodies them both. It says:
  "the essential objective of all provisions relating to the disposal of toxic or dangerous waste must be the protection of human health and safeguarding the environment against harmful effects."
  Under the regulations all that has gone. It is not defined. Instead, there is a new test, with which I shall deal in a moment, about danger to life. That is a less onerous test and a less desirable objective than is contained in the EEC regulation.
  Sixty per cent. of all the hazardous wastes no longer need to be notified. Regional water authorities do not have to be notified at all. The Government are relying upon a system not contained in the statute by which regional water authorities think that they will have sufficient information to carry out their duties. In the view of many of us, that is not adequate. Before waste arises at an industrial concern and is taken away by transporters, every local authority concerned and each regional water authority should be specifically notified. Through those means there should be a cast-iron guarantee to the public.
  The EEC directive deals with toxic and dangerous wastes by reference to risk to health or to the environment. I signed that regulation on behalf of the House, without opposition, when reporting back on the negotiations, in the certainty that risk to health and risk to the environment should be equal in importance. I would go so far as to say that it is my belief that these regulations are not valid under European law.
  I would like to hear from the Minister what action he feels will be taken by the Commission which was so jealous that the EEC regulation should be watertight and should safeguard the public. That is another ground on which the House should reject the regulations that we are discussing. If that does not happen, I hope that the

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  Commission will take note of these proposals and apply to them the tests that it had in mind when framing its own regulations.
  I turn to the question of special wastes. These fall into three categories. They are the centre-piece of the Government's proposals. They deal with wastes that are highly flammable. They deal with restricted medicines. They deal, most importantly, because it is a new definition, with wastes that are a danger to life. After 25 years' membership of the House I find in these regulations a definition and a proposal that are the most incredible I have seen used by any Government in legislation.
  The definition of danger to life will be to show that
  "a single dose of not more than five cubic centimetres would be likely to cause death or serious damage to tissue if ingested by a child of 20 kilograms' body weight or …exposure to it for fifteen minutes or less would be likely to cause serious damage to human tissue by inhalation, skin contact or eye contact."
  When I contemplate that definition in a statute or regulation to become law in this country, I ask "Have Ministers gone mad?" What other explanation can exist for such a ludicrous proposal? In case hon. Members need further elucidation of what this means, I refer to the remarks of the Earl of Avon, the Government spokesman in the House of Lords, who said that he wanted to simplify matters. He said:
  "A standard body weight of 20 kilogrammes, equivalent to a four to five year old child, is prescribed simply to enable the conversion of published toxicity data normally expressed in terms of a weight of toxic substance per unit body weight to an actual weight of substance."
  He added, in case anyone was still befuddled:
  "So this is something which when we produce our explanatory papers is meant to simplify things and not to complicate matters."—[Official Report, House of Lords, 19 January 1981; Vol. 416, c. 327.]
  Ministers have taken leave of their senses.
  I do not know what the Minister for Local Government and Environmental Services is saying to his hon. Friend the Under-Secretary. I took the precaution of reading the Official Report of our debate in 1972, when the right hon. Gentleman made a most penetrating comment about the need to safeguard the country. How he, having made that comment, can produce these regulations defies all logical examination.
  When some of us had responsibility a year or two ago, I cannot believe that if any of our officials had produced this sort of mumbo-jumbo he would have had time to sit in front of our desks before being shown the door. Such definitions not only defy logic; they are almost an insult to the intelligence of the House.
  Are local authority inspectors, who have to decide the matter, to go round the country weighing sample children of the ages of 4 and 5? Are they expected to assess the likely effect of 5cm of toxic waste upon such children? Worse, having done so, are they expected to persuade a disturbed and anxious public that a child weighing 1 kg more, or swallowing only lcm of toxic waste less, is a reasonable risk compared with the definition of risk in the regulations?
  I am pleased that the new Under-Secretary is to respond to the debate, because he is the only Minister in the Department who is not tainted by the regulations and has had no responsibility for drawing them up. Since he is an agreeable gentleman, one can hope that he at least will see the logic of the concern throughout the land and agree that the House should not support the regulations, and that they should be revised.
  Mr. Rooker: My right hon. Friend has described the regulations as mumbo-jumbo. Do they not mean that somebody, under the direction of Ministers in the Department, has worked out the cost of a human life? This is all tied up with money; waste disposal is a profitable business. Somebody has worked out in terms of a 4-year-old or 5-year-old child what amount of a substance is required, so that someone can make a quick buck. That is what it is all about.
  Mr. Howell: I would not go as far as my hon. Friend, but clearly some scientists, somewhere, must have done some experiments with animals—rats or rabbits—in order to reach conclusions that they then tried to translate in terms of the human physiology of children aged 4 or 5. That is an offensive concept to anyone who cares about the principles involved.
  I have not found one inspector in any local authority anywhere in the country who is prepared to accept the responsibility imposed upon him by the regulations. The House would be doing its duty if it strangled the regulations tonight, not least because of the unacceptably restricted definition of "special waste" in part I of schedule 1. Under that schedule it is not sufficient for a waste to be "special". It also has to be "dangerous to life".
  I cannot understand how any hon. Member can possibly vote for such a proposition. On what scientific evidence has it been produced? How many experiments, on what animals, have been conducted in order to reach those conclusions, and how have they been translated to human life?
  These regulations are grossly offensive and highly dangerous. They remove safeguards that have worked remarkably well. They replace them with mumbo-jumbo and with a set of regulations that every local authority says cannot be enforced.[Interruption.] If Ministers do not agree, why have they not met the representatives of local authorities? All the local authority associations tell us that their members are wholly and unitedly with them in condemning these regulations. [HON. MEMBERS:"A minority."] No doubt the Minister will tell us which local authorities form the minority, and no doubt he will say why his right hon. Friend the Minister for Local Government and Environmental Services adopted one standard for the protection of the public when he was on the Back Benches and why now that he is the Minister responsible he is adopting a lesser standard.
  These regulations cannot be enforced. They are contrary to the EEC directives, and in the interest of the nation I ask the House to join us in voting against them.
  10.47 pm
  The Under-Secretary of State for the Environment (Mr. Giles Shaw): The House has listened with commendable patience to the tirade of the right hon. Member for Birmingham, Small Heath (Mr. Howell) on these regulations. He has the qualification to speak on these matters, not only as the Minister responsible when his party was in Government, but also as the Minister responsible for the Control of Pollution Act 1974. We are now considering the implementation of section 17 of that Act. I assume that the right hon. Gentleman will be glad that we have taken his Act to heart and that we are proposing to implement section 17 of it in the manner that he laid down as being suitable and sensible in relation to the control of toxic waste.

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  But the right hon. Gentleman, who I am sure is honourable in all things—is not right in all things. He suggested that the Royal Commission on Environmental Pollution was not consulted. It was. He suggested that mercury was a substantial hazard, and he referred to the Japanese disaster. That is not so, because the mercury derivative here is not the same as that which caused the disaster in Japan. He suggested that there was no control over the transportation from the point of origin to the point of disposal when of course there is. The regulations ensure that. He suggested that no information could be given to the disposal authority in the area where the waste occurred. That can and has been done for a considerable time. There was not very much that the right hon. Gentleman could find in these regulations which provided him with enough solid fact, although much fiction was displayed.
  The right hon. Gentleman has a point, which I concede immediately, in that any matter concerning the disposal of toxic waste should be taken extremely seriously. That is why there have been consultations over three years with those who are involved, not only in the manufacture of substances, but also in the disposal of substances. I deeply regret that in relation to the Association of County Councils and others there has not been complete agreement on the way in which the regulations are to be implemented.
  However, some authorities have found them perfectly acceptable. The county of Suffolk, which has examined them in detail, found that it was easily able to define the 39 wastes which were required. The head of the planning department of the county of Leicestershire, the responsible department of that county, found them perfectly acceptable, and the county dissociated itself from what the Association of County Councils said. I accept that there is disagreement between members of the Association of County Councils, and certainly there is disagreement between the Government and the association about what we propose. But I shall indicate the extent to which consultations have taken place, including recent consultations, and the extent to which the Government will be prepared to meet the anxieties which the ACC has expressed.
  Quite rightly, the question of where these regulations fit in has to be looked at in the context of the legislation of the period. The right hon. Gentleman will agree, I am sure, that his Control of Pollution Act 1974 was rightly a replacement for the measure in 1972 which was rushed through this House to deal with the deposit of poisonous wastes. That Act made it an offence to deposit poisonous, noxious or polluting waste on land in such a way as to cause an environmental hazard. In other words, the 1972 Act attempted to determine what would be a threat to public health, animals, vegetation or water. It also made it an offence not to notify local authorities and the water authorities of the intention to dispose of a notifiable waste. It defined notifiable wastes by listing those wastes which were not notifiable, subject to certain qualifications.
  The 1972 Act had many grave omissions. For example, it did not provide controls over the disposal of notifiable wastes. By that I mean that it did not empower local authorities to prevent the waste from going into a site for disposal even if they did not wish it to go and even if they had been notified of the intention. They could seek to
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  persuade the site operator not to accept it, but site operators did not have to take notice of what the local authorities said. The local authority could therefore mount the prosecution only in very exceptional cases, and it was extremely hard to prove liability under this system. In effect, authorities could not even shut the door after the horse had bolted. What they could do was punish the horse if they caught it. It is not surprising that in 1978, for example, there were only three prosecutions under the Act.
  In addition, the Deposit of Poisonous Waste Act did not create an efficient administrative system. Quite the reverse was the case. There must be several hundreds of thousands of paper copies of notifications in circulation each year in England alone.
  Thirdly, the Act did not control the transport of dangerous waste from the producer to the disposal site—a point which the right hon. Gentleman believed, I suspect, was controlled by the 1972 Act. In fact, it was not. What is more, the Act did not provide for a clear, accurate set of descriptions for each waste that was notified. Vague terms such as "petro-chemical processing waste", and so on, were used which were not good enough as an instrument of control.
  Although there was a minimum period for advance notice of the intention to deposit, there was no maximum in the Act. Again, this was not sufficient for adequate control.
  We have to conclude that the Deposit of Poisonous Waste Act was, as it was designed to be, a stop-gap measure, and it has now outlived its usefulness. This is now the time to replace, in this section of the Control of Pollution Act, for which the right hon. Gentleman rightly takes some credit, the Deposit of Poisonous Waste Act 1972 and issue new regulations which are more in keeping with it.
  Part I of the Control of Pollution Act was enacted in 1974. In 1976 came the regulations under it which introduced the site licensing system. That system, as I am sure the right hon. Gentleman will agree, has a very important part to play. Frequently, the right hon. Gentleman laid stress on transportation or on the point of origin. But the control of the licensing of sites is fundamental to a policy which attempts to control the disposal of toxic or noxious wastes for the benefit of humanity and the environment.
  The system introduced in the Control of Pollution Act provided proper, positive—and not negative—controls over disposal. It was a preventive measure of the kind that was needed. Commercial, industrial or domestic wastes—called controlled wastes under this Act—whether notifiable or not, can now be disposed of only at a site which is licensed for the purpose, and in accordance with the conditions of the licence. Before a licence application can be considered, planning permission must be obtained. Hon. Members should note that at both stages the water authorities are consulted.
  This is the right sort of control—it covers the disposal of all wastes. It enables local authorities to specify precise and stringent conditions for the disposal of all hazardous wastes or to ban them from a site. As would be expected, therefore, most of the licences for sites which take "notifiable" wastes—the terminology under the Deposit of Poisonous Waste Act—specify the individual wastes

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  which may be taken at the site. All licences or conditions for local authorities' sites cover the manner of disposal, site operation and supervision.
  Mr. Peter Hardy: The Minister is right to suggest the importance of registration and supervision of sites. Is it not clear that under the Government's proposals local authorities will be unable properly to monitor and control those sites unless theres is 24-hour supervision? No local authority can provide such supervision at the moment.
  Mr. Shaw: I disagree with the hon. Gentleman. The main control that local authorities should apply is on licensing sites and on making sure that licensed sites are properly run and effectively managed.
  One of the problems with the Control of Pollution Act and with its predecessor, the Deposit of Poisonous Waste Act, is that too much local authority time has been involved in administration and too little in site inspection, at the place where wastes are disposed of, where it really matters. I suggest to the hon. Gentleman that under the regulations proposed there will be more rather than less time available for local authorities to control and inspect sites. Therefore, that is part of the reason why we are making a significant improvement in offering the regulations for approval by the House.
  Mr. Dennis Skinner: If the Minister is so concerned about trying to keep up to date with the various toxic wastes that are coming on stream, and since he wants to streamline the procedures, does he think it wise to extend the powers of consultation as far down as parish councils? By and large, in many rural areas the people who live in the parishes have to suffer from the waste deposited. Since he is so concerned about trying to keep up with these, what is his opinion on the following matter? In 1968, deadly dioxin was dumped secretly at a parish near one of the parishes in my Bolsover constituency as a result of an explosion at the Bolsover Coalite factory. Should not permission be given to ensure that it is put in a much safer place? If the Minister is so concerned about improving things, why does he not include that? Amongst the planning authorities that the Minister did not mention was the Tory-controlled Derbyshire county council, which sent me a letter saying that the benefits of that proposal would be that the waste disposal industry would have its paper work reduced.
  Mr. Shaw: I am a believer in answering a question that is put to me, if I can.
  Therefore, I inform the hon. Member for Bolsover (Mr. Skinner) that we are improving local authority control over disposal sites. When we consider the question of the 1968 dioxin waste which was buried at Morton in Derbyshire, I accept that that was a problem. Local rumour has it that the material was buried at an open cast site at Morton. The pollution incident at an adjacent toxic disposal site some years later reawakened local fears. The hon. Gentleman was active in trying to find out more about that incident. He would know—and I trust that he accepts —that the Severn-Trent water authority has advised in the past that neither the deposits of contaminated material nor the continued operation of the Morton site presents any threat of pollution to water sites in the area. The Derbyshire county council has been told in confidence by the company where that site is. I also understand that a local councillor has recently made public the location.
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  I return to the major matter under discussion. The new system is designed to repair some of the deficiencies in the present system, the main deficiency of which is the lack of proper control over the carriage of hazardous waste. The right hon. Member for Small Heath was wrong when he suggested that under the present system we have proper control over such carriage. The wastes are carefully controlled at the producers' premises by the Health and Safety at Work etc. Act. Disposal is covered by that Act and by site licensing. But there is currently no system to pin the responsibility for misuse of the really dangerous wastes in transit, or for heedless disposal into the environment at each stage of its journey from producer to disposer.
  The Government fully accept the grave risk which can and, I assume, must be run in relation to "cowboy" disposers—those who seek to evade all possible regulations, who go out in the middle of the night with a load of toxic substances and dump them at an unknown place. These are the cowboys of the night whom the right hon. Gentleman and we equally seek to catch. But with this system of control in transit of really dangerous wastes from the point of production to the point of disposal, we have gone a long way to trying to prevent illicit distribution. The consignment note system will provide that control.
  The new regulations also require proper registers of consignments. Most important also is the requirement that a record of the location of the disposal of special waste is kept—and kept in perpetuity. Hon. Members can rest assured that sites will be registered and that that register will be kept up to date. That is essential, so that sites can be properly and swiftly reclaimed and put to appropriate use later.
  The Secretary of State will have some emergency powers. They are likely to be rarely used and include a provision for prior consultation.
  The regulations will also complete compliance with the EEC directive on toxic and dangerous wastes. The right hon. Gentleman suggested that the regulations would be completely anathema to the European directive. That is not the case. They are complementary and comply with it.
  What do we lose with the repeal of the Deposit of Poisonous Waste Act? We dispense, certainly, with the requirement that notifications about the less troublesome wastes, which do not cause the bother, should go to local authorities. I have explained that they will be undertaken at a site licensed for the purpose and with conditions approprate to the circumstances. Because the definition of "notifiable waste" disappears with the Act, it is to be replaced with criteria which will specify which wastes really are a hazard. It is those wastes which need the consignment note system to cover their transit.
  The criteria for the new control, which the right hon. Gentleman and others criticised for their complex appearance, follow a logical progression. I shall not give the House a lecture in toxicology, as the right hon. Gentleman tried to do, but they set out a series of tests which are easily applied one by one. If a waste fails any of these tests—for example, if it is flammable at 21 degrees Centigrade—it simply becomes a special waste, and the regulations will apply.
  The Institute of Solid Waste Management, whose membership includes many of the waste disposal officers, the National Association of Waste Disposal Contractors and industrial firms are among those who have seen the

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  bulk of the Department's guidance and tested the approach. They are satisfied that it is workable and in the main they are keen to get the system into operation and iron out any difficulties in practice.
  One county council—Suffolk—as I said, told the Department that it applied the approach to 40 different kinds of waste that it encountered and 39 of them represented no problem. But if experience shows that the definition needs altering, we shall alter it. I am confident that, as it stands, it does not increase risk in any significant area.
  This has been an important development so far. The pattern of co-operation is one on which we shall continue to build. There is an invaluable pool of experience—it is time to capitalise on it—between waste producers, waste disposal authorities and the local authorities at either end of the chain. If there is any doubt about the status of the waste, it should be treated as a special waste until that doubt is removed.
  What is the sum of the loss for these gains? Certainly, many paper notifications which are of no practical use will go. That will save authorities and industry time and money. Despite what the right hon. Gentleman said, those controls do not improve one whit the powers of waste disposal authorities over the carriage or transport of waste or over its disposal. They have operated reasonably well because of co-operation among all involved. That cooperation will remain.
  I turn to the question of the Association of County Councils, and our consultations with it. As I have indicated, consultation has been extensive for a long period. The local authority associations were involved in that, as were the industrial interests—industry generally through the CBI, major generators of special wastes through the Chemical Industries Association, the waste disposal industry itself, and many others. All are agreed on the objectives. Although we have not been able to meet every point made, we have not proceeded in isolation. We have struck a good balance between the views. The test of practice is needed now.
  Several of my hon. Friends have written to me about the issues raised by the ACC. I am in no doubt about the strength of its concern. I have replied, I think, to most hon. Members and explained that I have given assurances and undertakings on two of the three points the ACC has itself identified as crucial. I have discussed them informally with the ACC. I have not been able to meet its points completely, and it has felt unable to modify its position. Contact will, of course, continue. But I must make it clear to the House now that the Government cannot agree that points which cannot be properly resolved without the benefit of operating experience should be allowed to delay the introduction of the important improvements these regulations will bring.
  Mr. Kenneth Marks: On a point of order, Mr. Deputy Speaker. In your role as the protector of Back Bench rights, I ask you, Mr. Deputy Speaker, to see what can be done about the ridiculous state of affairs in this debate. We are debating regulations that are lengthier than many Bills. They are highly important, and concern every person in the country. At least 13 Back Bench Members are waiting to speak, with 29 minutes of the debate remaining. May I urge you to use your power
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  or influence to persuade the Government to withdraw the regulations, especially as the implementation date is only a month ahead, until adequate time can be arranged to debate the issue? More hon. Members wish to speak in this debate than is usual on the Second Readings of major Bills.
  Mr. Deputy Speaker (Mr. Richard Crawshaw): The House will have noticed that this is a motion to revoke regulations, not to annul them, because the time for doing so has expired. The only reason why the House is able to discuss the matter tonight is that the business motion lays down that the matter may be proceeded with until 11.30 pm. The Chair has no discretion in that matter. If nothing has been moved by 11.30 pm, the motion lapses. If, before 11.30 pm, anyone moves that the Question be put, I shall put the Question. I cannot extend any time for discussion because the business motion permits discussion only until 11.30 pm.
  Mr. Shaw: In deference to the hon. Member for Manchester, Gorton (Mr. Marks), I shall seek to draw my remarks to a speedy conclusion. I want to stress that the discussions with the ACC are of crucial importance to hon. Members on both sides of the House.
  The local authorities put three crucial points to me. They want the Department to provide expert witnesses in court when they mount a prosecution. I said that if such experts were not available elsewhere, the Department would provide them, or put them in touch with an appropriate source. They asked that the regulations should specify that the burden of proof that a waste was not special was on the producer. The initial responsibility for complying with the regulations and deciding whether a consignment note is needed is indeed on the producer. If there is a problem—and we shall discover that during the course of the regulations—I shall be willing to consider any proposal that the local authority associatons wish to put to me for an alternative method to regulate that point. They asked for prenotification—advance warning—for authorities for the area where the waste is produced on a par with authorities for the area where the waste is to be disposed of. The authorities won a substantial concession against the views of industry on the latter point early on in the consultation process. I have taken what I believe is the fairest approach on that point. Interests conflict, and I am not persuaded that additional prenotification is required. But again if, after a period, it can be shown that the regulations are deficient on that point, I shall be happy to amend them. I also pledged a formal review after 12 months of operation. That will be the correct time for it to be evaluated, and all concerned will have had their minds concentrated on that review from day one.
  That is the way in which I have sought to meet the opposition of the ACC. I deeply regret that I have not been able to satisfy it, but it is certainly not for want of trying. It offers an opportunity to review the regulations in action, which is the only satisfactory way to eliminate not points of principle or major disagreements about what the regulations are intended to do, but significant disagreements on some practical aspects of the chain of command from waste producer to waste disposer. There is no major difference on the principle of what these regulations seek to do. They seek to implement section 17 of the Control of Pollution Act, which replaces the previous Deposit of Poisonous Waste Act 1972. By moving in this direction,

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  we move not for less control but for more. We move not for more hazard but for less. I confidently recommend these regulations to the House.
  11.5 pm
  Mr. Kenneth Marks: My advice to the new Minister—whom I welcome to his post, having undertaken a number of late-night debates in the same capacity—is to take these regulations back, and certainly to get rid of the date of 16 March, which is there only because it happens to be the anniversary of the passing of the EEC directive. In the meantime, he should go to places such as Pitsea, in Essex, or to Greater Manchester, or the West Midlands and the other areas concerned and look at the subject for himself.
  At the weekend I talked to the Greater Manchester official who has responsibility for this matter. Greater Manchester had not received any correspondence direct from the Minister. I know that the Minister will say that we must deal with this prayer first, but the regulations have been made and authorities ought to have received a direct communication from the Department. They have had none. There are no stocks of the consignment notes, and so on, which will have to be ordered within the next few weeks. The register of toxic effects of chemical substances is only just available, and the local authorities do not have it. It will be their Bible in dealing with these matters.
  There have been no meetings of officials of the authorities to discuss how they will implement the regulations, and yet they must come into effect on 16 March. The Deposit of Poisonous Waste Act, whether or not it was rushed through, has dealt with this problem adequately, but it will cease to have effect as from 16 March.
  The Government are making a serious mistake. They have not thought about the practical proposition. They talk about field work. What will happen in practice is that local authorities will be expected to get rid of highly qualified people and leave the matter to people on site who do not have the right qualifications. All that the Government are concerned about is complying with the wishes of the Community and cutting local authority costs. I am afraid that what will happen, whether or not the Minister likes it, is that the cowboys will have a field day.
  There is no mention of the problem in the metropolitan areas in particular, where the disposal authorities are not the same as the collection authorities. There can be significant problems about that, as there have been already.
  There are provisions in the Deposit of Poisonous Waste Act which are not covered in these regulations. Some have been taken out. There is the question of hazardous waste transferred from one authority to another. The authority in whose area the waste arises is responsible for the supervision, but some of the waste is transferred from Manchester, for instance, to Essex. Hon. Members from Essex do not think much of that idea, but this happens. How will Greater Manchester supervise this? There needs to be provision for the receiving local authority to let that local authority know that it has had that waste and that it has been disposed of. Much firmer direction is needed.
  As for the definition, the matter of the 5 cc has already been raised. What happens if that 5 cc is in a waste of another kind? That frequently happens. Waste is not always segregated. Does it have to be segregated?
  708
  The real need—this is where the Government are defeating their own objective—is for adequate local authority staffing. By their policies the Government are destroying the adequate staffing that exists in many cases.
  Dr. McDonald: Does my hon. Friend agree that in the case of my own constituency, where there are five pits for the disposal of toxic waste—for Thurrock takes in, together with the Pitsea pit, 100 per cent. of the toxic waste from South-East England—supervision of the site, to take an example of which the Minister made great play, would have to consist of 24-hour supervision of five sites, and supervision of transit to the sixth site on the borders of my constituency? Does he agree that the Government should put their money where their mouth is and make the money available for the kind of inspectorate that would be required to supervise both transport and the deposit of such waste?
  Mr. Marks: My hon. Friend has taken the words out of my mouth, but I shall still say the words. The Government's policy of a 6 per cent. pay increase when pay inflation is running at 15 per cent. will make the regulations almost impossible to work.
  Let us consider a metropolitan council with a possible 6·per cent. pay rise. The firemen, rightly, have been granted an 18·8 per cent. rise. The other employees include the police, administrators and waste disposal staff. Firemen and waste disposal employees form the major part of such staffs. Highly qualified people will be poached from the local authorities by industry.
  The Government's policy on local authority cuts, staff and pay will make nonsense of what they are trying to do. The Government have already abolished the waste management committee and the anti-waste campaign. The order is another example of the Government's ineptitude and lack of care for the country's environment.
  11.11 pm
  Mr. Peter Griffiths: I shall be as brief as possible. I am no expert on toxicology and I should not have intervened in such a debate as this except to give a general welcome to developments in the modernisation of the disposal of waste, particularly of dangerous waste. I took the precaution of speaking to one of our premier authorities, the public analyst and scientific adviser to the Hampshire county council. He has an international reputation. I asked him why there was such criticism of the regulations, not only from the county councils but from the municipal authorities and the GLC.
  I shall confine myself to a narrow range of points, which that gentleman explained to me. He said that he would welcome a harmonisation of our regulations with EEC regulations. Yet he said that the odd test of toxicity related to a 20 kg child had nothing to do with European regulations. It is not recognised in the EEC, and it takes us away from the expertise in the EEC and this country which is related to danger to health and to the environment. The analyst said that under the regulations the task of supervision would be so complicated that it would not be possible for the local authorities to maintain the necessary number of toxicologists, because of the limited supply, which is not always available to local authorities.
  He said that local authorities could not turn to tables of toxicity for particular chemicals in relation to a child

  709
  weighing 20 kg. As he said, the information about humans has been gathered over a period. Only some of it relates to children. One cannot assume that toxicity is related directly to body weight. It is not proportionate to body weight. One cannot simply look at information for a human being of a different size and divide by the weight.
  It is also pointed out that a great deal depends on the state of health and physical condition of the child, and on the way in which the substance and the child are brought together. I could list many criticisms, but time does not permit me to do so. It is not recognised that children and others will not be faced with the toxicity of only one dangerous waste product. In most disposal sites there will be more than one item of waste, each of which may be dangerous. A combination may reduce the danger, but, on the other hand, two substances that are not toxic to the levels mentioned in these regulations may, in combination, easily become so.
  The number of possible combinations of toxic wastes is almost infinite. I make a straightforward statement to the Minister. It is impossible for the scientific adviser to the Hampshire county council to say that he can carry out these regulations in a way that is safe. He asked me to use the word "alarm". When a scientist uses such a word we should take the greatest notice of what he has to say. I am extremely worried about that part of the regulations. I trust that the Minister will recognise that this strength of feeling is experienced not merely by politicians, but by the scientific community.
  11.16 pm
  Mr. Donald Anderson: We look forward to seeing the hon. Member for Portsmouth, North (Mr. Griffiths) in the Lobby with us tonight. To many of us, the Government's response to this issue is a touchstone of their attitude to the environment in general. Given what we have heard tonight, and other actions, such as the abolition of the Waste Management Advisory Council, it is hardly surprising that the Government have had such a bad press in environmental circles.
  The Minister began on a bad point. The hon. Gentleman said that two local authorities—Leicester and Suffolk—were in favour of the proposals. That is complacent. He knows that there has been almost universal condemnation of the proposals by those that have been asked to enforce them. He said that further consultation with authorities could take place, but he knows that such a statement is hardly meaningful. The Government have a self-imposed timetable. How meaningful can such consultations be if they are to take place between now and 16 March?
  The Minister claims that he has met the Association of County Councils on a number of points. However, if he looks through its briefings—which I largely adopt—he will see that there are at least nine key points at the end that the Minister has failed to satisfy. Given the time, I shall adopt a fairly narrow approach and mention only three points that are of particular concern to Wales. They have been underlined by Baroness White in the other place.
  First, Wales has its own problems. For administrative reasons, the ACC represents 39 large shire counties in England, but responsibility for waste disposal in Wales rests with 37 district authorities that are smaller and that
  710
  have few resources in terms of manpower and finance. None of those authorities employs toxicologists. They firmly said that they could not, under these regulations, control waste in a safe, effective or economical manner.
  Secondly, the Government and Whitehall appear not to have considered the peculiar topographical problems of areas such as Wales, where there is greater danger of leaching into aquifers. A quarry in my area of Cwmrhydceirw is used for dumping. Today, my environmental health officer told me that they do not know where the standing water drains to. The poisonous waste that might emerge could be dangerous.
  Thirdly, my right hon. Friend the Member for Birmingham, Small Heath (Mr. Howell) has mentioned the narrow definition of toxicity and the possible danger to the life of a 20 kg child. Scientists are very uncertain about this definition. It ignores the cumulative effect of small doses and has particular relevance to the older industrial areas, where toxic material may have accumulated over a period of time. For example, in the lower Swansea valley—the classic area for waste zinc and copper—where surveys have been sponsored by the Nuffield Foundation, it is clear that local children are already at risk from a variety of sources. These regulations can only add to the danger.
  It is an uncertain area—an area of unknowns. I commend to the Minister the book that was published as a result of the conference last May, sponsored by the Nuffield project, on this older industrial area, because it shows the uncertain state of scientific knowledge in this sphere. For example, there is uncertainty on the question of how long poisonous substances remain in the soil, and the difficulties of separating dangerous substances from the new topsoil.
  Finally, and more important in terms of the expenditure of time on money, there is the need for the Government, on a United Kingdom basis, to investigate methods of disposal of waste substances and not to go for the cheapest means of dumping in holes in the ground. For example, my local authority is now proposing to dump waste on a site alongside a site of special scientific interest.
  Until we have clearer scientific evidence, and until there is a greater basis of consensus with those who have to enforce these regulations, I believe that the Government should continue with the present legislation, ignore their self-imposed timetable, take these regulations back, and think again.
  11.21 pm
  Mr. Charles Morrison: I cannot help but comment that if the Opposition Front Bench spokesman takes 29 minutes to make his speech it is not surprising that my hon. Friend the Under-Secretary of State should take 23 minutes to make his speech. Even so, it is extraordinary that, in a debate which can last for only 77 minutes, 52 minutes should be taken by the Front Bench spokesmen. One wonders what anybody thinks the House of Commons exists for.
  This is a debate between theorists and practitioners. In considering these regulations, there are three questions to be borne in mind.
  First, do the regulations reduce the level of control of pollution by toxic waste and the acceptable standards? The Government say that they do not; the local authorities say that they do.

  711
  Secondly, does it matter? In my view, it does matter. Those who dispose of toxic waste are being put on their honour. There is no worry about responsible people. But what about those who are not responsible people? This is the point that worries the local authorities.
  Thirdly, do the regulations reduce the costs for local government? Regarding the bureaucracy, as the right hon. Member for Birmingham, Small Heath (Mr. Howell) pointed out, the answer is "Yes". But, so far as staff generally in local government are concerned, the answer is "No". What is more, in all likelihood, it will be difficult for local authorities to obtain the necessary staff that they will have to employ as a result of these new regulations. In effect, the regulations are creating nonsense in that respect.
  What should be done? The best answer would be for the Government to withdraw the regulations. At least, they should withdraw the regulations until the House of Lords Select Committee has had a chance to report. [Hon. Members: "Hear, hear."] I am delighted to hear the cheers by Opposition Members in praise of the other place, which normally they wish to get rid of completely. But the other place could do a very useful job on these regulations. It might even be that it would come out in support of the Government, but I suspect that it might easily not. What would happen if it did not? It would make much more sense before introducing the regulations to await the outcome of the Select Committee in another place, which I have no doubt is filled with those who really know what they are talking about.
  Finally, and sadly, it seems that the regulations are yet another example of the man in Whitehall thinking that he knows best. That is not often so, and on this occasion there is a strong case for a degree of humility as it is not the man in Whitehall who puts the regulations into practice or who carries the can if something goes wrong. I can imagine the departmental self-righteousness when something goes wrong, as assuredly it will.
  It is remarkable that there is such unanimity of thinking on the part of the local authority associations, which are not best known for their ability to agree about anything. The Government must think again about this matter.
  11.26 pm
  Mr. David Alton: I shall briefly reiterate the remarks that have been made from all parts of the Chamber against the regulations. Having listened to the hon. Members for Devizes (Mr. Morrison) and for Portsmouth, North (Mr. Griffiths), as well as to Labour Members, I hope that the Minister will reconsider these inadequate proposals. They are highly misguided and could be damaging in the control of pollution.
  I remind the House of the debate that took place in another place on 19 January, when Baroness Birk said:
  "Finally … this action is absolutely devastatingly, and, I would say, disgracefully immature, because the House of Lords Select Committee on Science and Technology is looking into the whole subject of the organisation of method of hazardous waste disposal."—[Official Report, House of Lords, 19Jannuary 1981; Vol. 416, c. 312.]
  Surely it would have been prudent to await the outcome of the Select Committee's findings before deciding on these regulations. Surely it would have been prudent to listen to the Association of Metropolitan Authorities, the Association of County Councils and district and county councils throughout the country.
  712
  I refer briefly to a letter which was sent to my hon. Friend the Member for Isle of Wight (Mr. Ross) by the secretary and solicitor of his council, which points to the hazards that could be caused in that constituency if the regulations are enacted.
  We must decide what sort of community we want to live in. Do we want to live in a country that is a green and poisoned land or one that is a green and pleasant land? That is the issue on which we shall be voting. Regulations that reduce in any way the control over pollution are misguided and misconceived and the House should vote against them.
  11.28 pm
  Sir Bernard Braine: In common with all those who have participated in the debate, I am deeply uneasy about the regulations. There seems to be some dispute about the attitude of the local authority associations. However, the Conservative-controlled Essex county council is utterly opposed to the regulations. Why is that? The reason is that Essex has suffered more than any other county from the uncontrolled deposit of waste, and toxic waste at that. The county council is most perturbed at the possibility of a weakening of control over the disposal of material of this nature that is at present notifiable but will escape notification if the regulations are enforced.
  The Association of County Councils tells me that two-thirds of the toxic wastes notifiable under the present system will cease to be notifiable from 16 March. Toxic wastes that are not likely to cause death but are dangerous to health and the environment will no longer be notifiable. The definition of toxicity has been dealt with adequately by my hon. Friend the Member for Portsmouth, North (Mr. Griffiths).
  No protection is given against the danger of chronic ill-health from exposure or against chronic ill-health caused by the escape of low-concentration pollutants—
  Mr. Walter Harrison Mr. Walter Harrison (Wakefield)rose in his place and claimed to move, That the Question be now put.
  Question, That the Question be now put, put and agreed to.
  Main Question put accordingly:—
  The House divided: Ayes 81, Noes 117.

  Division No.66]

  [11.30 pm

  AYES

  Alton, David

  Duffy, A. E. P.

  Anderson, Donald

  Eastham, Ken

  Archer, Rt Hon Peter

  Ellis, R.(NE D'bysh're)

  Ashton, Joe

  English, Michael

  Beith, A. J.

  Evans, John (Newton)

  Bennett, Andrew(St'kp'tN)

  Foster, Derek

  Brotherton, Michael

  Foulkes, George

  Callaghan, Jim(Midd'tn&P)

  Garrett, W. E.(Wallsend)

  Campbell-Savours, Dale

  Graham,Ted

  Cocks, Rt Hon M. (B'stolS)

  Grant, George(Morpeth)

  Colvin, Michael

  Grant, John (Islington C)

  Concannon, Rt Hon J. D.

  Hamilton, James(Bothwell)

  Cowans, Harry

  Hardy, Peter

  Cunliffe, Lawrence

  Harrison, Rt Hon Walter

  Dalyell,Tam

  Hawksley, Warren

  Davis, T. (B'ham, Stechf'd)

  Haynes, Frank

  Deakins, Eric

  Holland, S.(L'b'th, Vauxh'll)

  Dean, Joseph (Leeds West)

  Hooley, Frank

  Dixon, Donald

  Howell, Rt Hon D.

  Dormand, Jack

  Hudson Davies, Gwilym E.

  Douglas, Dick

  Hughes, Robert (Aberdeen N)

  Douglas-Mann, Bruce

  Hughes, Roy (Newport)

  Dubs, Alfred

  Jones, Rt Hon Alec (Rh'dda)

  713

  Kaufman, Rt Hon Gerald

  Penhaligon, David

  Lamond, James

  Powell, Raymond(Ogmore)

  Leighton, Ronald

  Prescott, John

  Lewis, Arthur (N'ham NW)

  Roberts, Ernest (Hackney N)

  McCartney, Hugh

  Rooker, J.W.

  McDonald, Dr Oonagh

  Ross, Stephen (Isle of Wight)

  McKay, Allen (Penistone)

  Rowlands, Ted

  McWilliam, John

  Skinner, Dennis

  Magee, Bryan

  Smith, Cyril (Rochdale)

  Marks, Kenneth

  Steel, Rt Hon David

  Marshall, Dr Edmund'(Goole)

  Stoddart, David

  Maxton, John

  Wainwright, E. (Dearne V)

  Millan, Rt Hon Bruce

  Welsh, Michael

  Mitchell, R.C. (Soton Itchen)

  Whitehead, Phillip

  Morris, Rt Hon A. (W'shawe)

  Young, David (Bolton E)

  Oakes, Rt Hon Gordon

  Ogden, Eric

  Tellers for the Ayes:

  Park, George

  Mr. George Morton and

  Parry, Robert

  Mr. James Tinn.

  NOES

  Alexander, Richard

  Heddle, John

  Ancram, Michael

  Henderson, Barry

  Baker, Nicholas (N Dorset)

  Hogg, Hon Douglas(Gr'th'm)

  Beaumont-Dark, Anthony

  Holland, Philip (Carlton)

  Berry, Hon Anthony

  Hooson, Tom

  Best, Keith

  Hurd, Hon Douglas

  Bevan, David Gilroy

  Jopling, Rt Hon Michael

  Biggs-Davison, John

  Kershaw, Anthony

  Blackburn, John

  King, Rt Hon Tom

  Boscawen, Hon Robert

  Le Marchant, Spencer

  Bright, Graham

  Lester Jim(Beeston)

  Brinton, Tim

  Luce, Richard

  Brittan, Leon

  Lyell, Nicholas

  Bruce-Gardyne, John

  Macfarlane, Neil

  Bryan, Sir Paul

  MacGregor, John

  Buck, Antony

  Macmillan, Rt Hon M.

  Butcher, John

  Madel, David

  Carlisle, Kenneth (Lincoln)

  Major, John

  Clark, Hon A. (Plym'th, S'n)

  Marlow, Tony

  Cope, John

  Mates, Michael

  Cranborne, Viscount

  Mawhinney, Dr Brian

  Crouch, David

  Mayhew, Patrick

  Dorrell, Stephen

  Mellor, David

  Douglas-Hamilton, Lord J.

  Meyer, Sir Anthony

  Dover, Denshore

  Moate, Roger

  Dunn, Robert (Dartford)

  Monro, Hector

  Dykes, Hugh

  Morgan, Geraint

  Eggar, Tim

  Morrison, Hon P. (Chester)

  Elliott, Sir William

  Murphy, Christopher

  Faith, Mrs Sheila

  Needham, Richard

  Fenner, Mrs Peggy

  Nelson, Anthony

  Fisher, Sir Nigel

  Neubert, Michael

  Garel-Jones, Tristan

  Newton, Tony

  Goodlad, Alastair

  Page, John (Harrow, West)

  Gorst, John

  Page, Rt Hon Sir G. (Crosby)

  Griffiths, Peter Portsm'thN)

  Page, Richard (SW Herts)

  Gummer, John Selwyn

  Pattie, Geoffrey

  Haselhurst, Alan

  Pollock, Alexander

  Hawkins, Paul

  Porter, Barry

  714

  Price, Sir David (Eastleigh)

  Thompson, Donald

  Raison, Timothy

  Townend, John (Bridlington)

  Rathbone, Tim

  Viggers, Peter

  Renton, Tim

  Waddington, David

  Rhodes James, Robert

  Wakeham, John

  Rhys Williams, Sir Brandon

  Waller, Gary

  Roberts, M. (Cardiff NW)

  Ward, John

  Rossi, Hugh

  Warren, Kenneth

  Sainsbury, Hon Timothy

  Watson, John

  Shaw, Giles (Pudsey)

  Wells, Bowen

  Silvester, Fred

  Wheeler, John

  Sims, Roger

  Wickenden, Keith

  Skeet, T. H. H.

  Wilkinson, John

  Speller, Tony

  Williams, D.(Montgomery)

  Spicer, Jim (West Dorset)

  Winterton, Nicholas

  Sproat, Iain

  Wolfson, Mark

  Squire, Robin

  Young, Sir George (Acton)

  Stanbrook, Ivor

  Stevens, Martin

  Tellers for the Noes:

  Stradling Thomas, J.

  Mr. Carol Mather and

  Tebbit, Norman

  Mr. Peter Brooke.

  Temple-Morris, Peter

  Question accordingly negatived.

  STATUTORY INSTRUMENTS, &c.
  Motion made, and Question put forthwith pursuant to Standing Order No. 73A (Standing Committee on Statutory Instruments, &c.).

  ELECTION CANDIDATES (EXPENSES)
  That the draft Representation of the People (Variation of Candidates' Election Expenses) Order 1981, which was laid before this House on 14th January, be approved.—[Mr. Berry.]
  Question agreed to.

  EUROPEAN COMMUNITY DOCUMENTS
  Motion made, and Question put forthwith pursuant to Standing Order No. 73B (Standing Committees on European Community documents).

  DOMESTIC ANIMALS (HORMONE TREATMENT)
  That this House takes note of European Community Documents Nos. 10994/80 on the use of substances with a hormonal action and those having a thyrostatic action in domestic animals; COM (80) 922 Final, laying down conditions for controlling possession, distribution and administration to animals of certain substances with a hormonal action; and COM (80) 920 Final, concerning the control and examination of animals and meat in the Community for the presence of residues of substances with oestrogenic, androgenic, gestagenic and thyrostatic effect; but finds the present proposals impracticable and injurious to United Kingdom interests.—[Mr. Berry.]
  Question agreed to.

  Open Channel Radio
  Motion made, and Question proposed, That this House do now adjourn.—(Mr. Berry).
  11.42 pm
  Mr. Patrick Wall: I know that citizens band radio is normally associated with the motor car. It is, in fact, a hand-held telephone with no wires. It has many uses other than installation in motor vehicles.
  I first raised the question of the legalisation of this system in the House during the time of the previous Government, but they were clearly unwilling even to consider the matter. After the 1979 general election, the Conservative Government agreed in principle to freedom of the air, although they sensibly entered the caveat that this freedom should not interfere with other people's freedom.
  As a result, the parliamentary CB committee was formed under my chairmanship and also a National Committee for the Legalisation of CB Radio to co-ordinate numerous CB clubs and associations which represent over 100,000 CB enthusiasts. Councillor Yard was the first chairman of the national committee. He has been succeeded by Councillor Town.
  At this stage, I should like to pay tribute to the Minister of State, who has met both committees whenever we wanted to see him and who has been most helpful and frank about the difficulties he faces in legalising a CB system. However, I cannot understand why he insists upon calling it Open Channel when the general public, brought up on American films and television, always refer to it as CB radio.
  There is a strong impression among those interested in CB radio that the officials have opposed its introduction and have been fighting a rearguard action to prevent its legalisation—
  Mrs. Peggy Fenner: And how!
  Mr. Wall: —and have sought, if it is legalised, to emasculate it as far as possible. This view is illustrated by a discussion document that was made available last year. Incidentally, it was not obtainable from the the Stationery Office, which seems rather strange. The document was studiously vague, except in advocating a frequency of 928 MHz.
  The view is further illustrated by a meeting with Home Office officials on 18 December. I have here a copy of the minutes of that meeting, which was called for a time when it was known that the chairman of the national committee would be out of the country, as would its secretary, but the secretary managed to change his arrangements and attend the meeting. The object of the meeting is laid down in the minutes:
  "The meeting had been arranged in response to a request made by Mr. Raison, Minister of State, Home Office, on the 11th December by a delegation from the National Committee for the legalisation of CB Radio, for a discussion meeting with Home Office engineers on the technical merits of the delegation's proposals. The basis for the discussion was the National Committee's paper 'CB Independence'",
  a voluminous document, which I have here.
  The meeting made little progress in discussing the national committee's proposals, which had been submitted in detail to the Minister. It was confronted with a barrage of reasons why the 41 MHz band, which it had suggested,
  716
  should not be legalised. If my hon. Friend the Minister studies the committee's proposals carefully, he will see that in fact we proposed a frequency of 42·608 to 43 MHz, with 16 channels, and 43·694 to 44 MHz, with 20 channels. We know that the frequency tested by his officials—41·5 MHz—causes interference, but we claim that on the frequencies to which I have just referred the interference is minimal. It is clear from the minutes that these frequencies were never tested by his officials.
  Perhaps I should say here that the law is very muddled. As it stands, one can purchase a CB set, but one cannot install it, use it or import it. One hopes that these rules will be changed in the very near future.
  In view of the statements made in the House last week, I am bound to say that some officials of the Post Office searching for CB radios have adopted what amount to near-Gestapo tactics, by demanding entry at 2 am and virtually pulling a house apart in search of an illegal set. I have statements to the effect that the attitudes adopted might have been suitable for a search for an enemy spy transmitter during the last war.
  Mr. John Golding: Radio investigation officers, members of the Post Office Engineering Union, will bitterly resent the charge of using near-Gestapo methods, when they have to enforce a law that has not yet been changed, after representations from hospitals, fire services and other users. They have been put in an intolerable position, because they have to enforce the law. Conservative Members who would have law and order should do nothing other than to try to persuade the Minister of State to change the law to make it easier for them.
  Mr. Wall: I am glad that the hon. Gentleman intervened, because it was he that I had in mind. Of course he is right in saying that officials have to uphold the law. What I am saying is that the way in which they do it is not always in conformity with the normal practice. There are two sides to every question. I shall leave it at that. My hon. Friend the Minister will, quite rightly, defend his officials, but it is only right that he and the House should know that those interested in CB radio have strong feelings on the matter—as undoubtedly do the officials that the hon. Gentleman represents in his trade union.
  With that background, I come to the two basic questions that we have to consider tonight. The first is the frequency to be allotted, and the second is the timing of the legislation—or, rather, the legalisation, because legislation is not required.
  There are three possible frequencies—928 MHz, favoured by the Home Office, 42·8 to 44 MHz, favoured by the national committee, and 27 MHz favoured by the large mass of at present illegal operators.
  In answer to a question last Thursday, the Minister said:
  "we have been reviewing the possibility of introducing a service on a lower frequency, in addition to one around 930 MHz."—[Official Report, 5 February 1981; Vol. 998, c. 394.]
  I take it that that presupposes that either 42·8 MHz to 44 MHz or 27 MHz will be legalised. I cannot see any other meaning in that answer.
  With regard to 928 MHz, the Minister has admitted that the overwhelming number of replies to his consultative document were opposed to this frequency, largely because of the short range in built-up areas and the expense of UHF sets. I understand that the Europeans are studying an

  717
  international automatic car telephone around that frequency, but it will obviously be some time before the study is completed. France recently rejected that frequency completely.
  That leaves us with 41 MHz and 27 MHz. We are still in favour of the 41 MHz band. We have submitted evidence to show that, if properly tested, it causes minimal interference and no danger to health. Damage to health is possible on the 938 MHz band, using 25 watts, compared with 8 watts on the lower band. We need a range of about 10 miles, or, 15 kilometres, and an automatic identification device. It would clearly be of advantage to the manufacturers if the new frequency was legalised.
  In 1973, it was estimated that CB radio could provide work for 2,500 people and would cover a market of about £45 million a year. The Minister's main objection to the 41 MHz frequency, other than interference, is that it would have to wait until black and white television is phased out in three years. That is not our understanding. We understand that the BBC could almost immediately transmit black and white television on four of its transmitters, leaving the fifth available for CB users. That would also be in accord with international agreements.
  However, it may now be too late. Eighteen months ago, the Minister was warned that there were an estimated 30,000 illegal sets in this country, operating on 27 MHz. From the study of sales of aerials and other accessories, we believe that that figure has now reached 250,000. The Minister warned that the Governments of Australia and the Netherlands were opposed to that frequency but were forced to legalise it because of the large number of sets operating in those countries. That is most unsatisfactory, and I fear that the same situation will develop here.
  We backed the Minister in opposing 27 MHz, but we warned him that if action was not taken rapidly he would be forced to legalise that frequency. The police and the Post Office regulatory department have rightly—I emphasise rightly—increased the pressure against illegal operators, and many police forces have now given up as demands on their manpower have been too great. I understand that police constables have been issued orders to that effect.
  This is an unsatisfactory situation, but we must face facts. The question now to be asked with regard to 27 MHz is whether AM or FM should be legalised. Many illegal sets that are operating in this country today come from Japan or America, and they operate on 27 MHz AM. Although AM causes television interference, it is clear that some sets will continue to operate illegally whatever decision we reach. That is one of the reasons why the Citizens Band Association now favours AM.
  However, 27 MHz FM or CEPT PR 27 FM has now become virtually the official European standard. West Germany has legalised AM and FM. France, the Netherlands, Belgium and Luxembourg have legalised 27 FM. I understand that Ireland is waiting for our decision. Although it will be a great disappointment to many CB users, the 27 FM frequency is virtually the European standard, and it should therefore be legalised in this country as soon as possible. Those who have bought illegal sets can hardly grumble if this is done.
  One of the objections to 27 MHz was that it would affect model aircraft seriously. I understand that they have now switched to 37 MHz, so that objection is out of the
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  way. Should the Government decide to legalise 27 MHz, I believe that they should keep the 41 MHz band as a possible European standard for the future. Users will switch relatively easily from 27 MHz to 41 MHz, but they are unlikely to switch to ultra-high frequency such as 928.
  My final comment concerns the timing. The question is when. Pressure grows every day. There have been demonstrations. More and more sets are being imported illegally, and more and more sets are being used illegally. The position can only get worse unless the Government act at once. On Thursday, the Minister said:
  "We hope to be able to announce our conclusions shortly."— [Official Report, 5 February 1981; Vol. 998, c. 394.]
  I hope that "shortly" means within the next three months. This can only be in the Government's and the country's interest.
  As regards the administration of a legal system, I am authorised to say that the national committee, the CB Association and the clubs will give the Government every possible assistance in adminstration. But let us have a final decision before the second anniversary of the 1979 general election.
  11.56 pm
  Mr. Tim Rathbone: I am grateful, Mr. Deputy Speaker, for being allowed to support my hon. Friend the Member for Haltemprice (Mr. Wall). I add my own thanks to the Minister for his consideration of the whole question of citizens band radio, which is in stark contrast to the attitude of his Labour predecessor, who greeted every request for consideration of this subject with a negative response.
  The Minister only has to think about the number of hon. Members present to listen to this debate—an unprecedented number for an Adjournment debate—to understand the importance which is attached to it, and this is matched by the numbers of people outside the House physically this evening and outside the House at other times during the rest of the year.
  I fear that the Minister has to do battle with his officials in the Home Office, who have taken too negative an attitude over the years to the allocation of a citizens band radio wave length. The law against citizens band has been flouted for too long. When any law is challenged in the way that this law is challenged, a Government have seriously to consider changing it.
  I hope that the Minister will be able to give the House some reassurance that that change in the law is being considered by the Government right now.
  11.57 pm
  The Minister of State, Home Office (Mr. Timothy Raison): I congratulate my hon. Friend the Member for Haltemprice (Mr. Wall) on raising this topic. I acknowledge the leadership that he has given in this matter.
  As my hon. Friend said, it is just over a year since we last had a similar short debate on this subject, and a good deal has happened in that time. In it, the Government have moved from a position of examining the issues to one of support in principle; we have issued a discussion document on our views, and seen an extremely heavy public response to it; and we are now close to reaching our final decisions. Thus, while my hon. Friends will not be surprised if I say that I cannot tell them what those decisions are tonight, I can say that they will not be long delayed.

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  There is, of course, no legal open channel service now, but there will be one, and I think that it will be noted that it is a Conservative Government who will be taking this step.
  Mr. Dennis Canavan: When?
  Mr. Raison: I do not think that my hon. Friend the Member for Haltemprice will expect me to accept his strictures on my officials. I do not myself accept them. They have worked extremely hard under our policy, and I have no grounds for reproaching them.
  I have always thought that some of the arguments about the advantages and disadvantages of open channel or citizens band radio are sterile, or overstated. I believe that a new service can and will be helpful and enjoyable to many people, just as I am certain that it will cause problems and difficulties to others. But personal freedom matters, and that is the argument that we, as a Government, have always found strongest.
  I should like to explain some of the reasons why our decision is particularly difficult and has inevitably taken time. Radio regulation is an extremely complicated business. World conferences reach, by consensus, broad planning agreements designed to provide as much protection as possible to services of various kinds, and all administrations have to work within these in their national planning.
  The range of services to be protected is enormous—not just broadcasting or land mobile radio, of which open channel is one form, but radar, maritime and aircraft communications satellites, radio astronomy, radio links for passing digital or analogue information, and hundreds of other applications.
  We must remember that radio transmissions can be a source of interference to other radio services. The assignment of a frequency to a new service therefore requires the most careful consideration.
  I think, therefore, that it becomes clear that anyone who simply operates outside this carefully planned framework, however desirable his activities might appear to be, is likely to cause chaos. The present illicit 27 MHz transmissions are, unfortunately, a very clear example of this.
  I told the House a year ago that illicit users of CB could cause inconvenience and even risk to their fellow-citizens. One of the real difficulties about this is that a CB user generally has no idea of his effect on others. He may therefore think that we are simply crying wolf. But it is my Department that takes the overall responsibility for dealing with complaints of interference, and it therefore monitors closely what is going on.
  At present, in a year we expect to have about 35,000 complaints of interference from all sources to radio services. Over 90 per cent. of these relate to broadcasting services. In the last four months of 1980 there were more than 2,700 complaints, which were traced to illicit CB 27 MHz transmissions; in other words, a rise of nearly 25 per cent. in the total number of complaints. Nearly 2,000 of these were cases of interference to television reception, and nearly 600 to radio or hi-fi equipment. Police, fire, ambulance and hospital paging services were also affected. Our warnings of potential risks are therefore being borne out in practice in a way that can only cause concern. Such interference is expensive. It has to be paid
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  for by the television viewer, the licensed user of radio, or the taxpayer. Moreover, it may cause friction between neighbours.
  This interference from 27 MHz equipment comes largely from one of two sources—first, from unsuitable basic equipment; and secondly, from the use of powerful linear amplifers designed to boost the power output of the equipment many times over. Offending users have been traced, who have been using power outputs of 1 kW or even more—in other words, perhaps twice as much as the power of a local broadcasting station. I remain of the view that open channel must be a short-range personal radio service.
  The next significant thing about open channel is that it has to be a countrywide service. The user in the north of England will use the same frequency as his counterpart in the south of England. There are very few radio services of which one can say that. There are different channels for television in different areas. Private mobile radio frequencies are issued individually so that they can be interleaved geographically. A frequency that would interfere with, for example, a particular television channel is not used in the relevant area. But open channel, being countrywide, has to be able to live with and not to harm any other radio service throughout the United Kingdom and in neighbouring countries, such as France and the Republic of Ireland.
  Interference can have many causes. It is not simply a matter of one set of radio equipment interfering with another because they are operating on the same frequency. Any equipment when transmitting also emits potentially interfering, spurious signals. Of these, the harmonics or multiples of the tuned and basic frequency are generally most harmful. The fundamental or the harmonic signal may interact with the tuned frequency, with the intermediate frequency or with the frequency change oscillator in a radio or television receiver. Finally, interference may be caused simply because a transmitter is used too near the receiver of another service.
  This last category can never be eliminated, and it highlights clearly the difficulties that will be caused by open channel because of its mode and scale of use. Open channel will be a social thing. It will therefore be used widely in residential areas and in buildings such as blocks of flats, where it will be far nearer than transmitters of other services to home entertainment equipment such as radio, television, and hi-fi. This gives yet another twist to the interference risks inherent in such a service, and the scale of likely use presents problems of administration and enforcement never encountered in this form before.
  Finally, the radio frequency spectrum is finite and heavily used. There is no bottomless bucket of frequencies that we are hiding for our own purposes.
  Mr. Eric Ogden: Does the Minister accept that almost all his arguments about the difficulties are the same as the arguments used by Departments and services against local radio? Those difficulties were overcome. It should not be beyond the wit of man to overcome these difficulties.
  Mr. Raison: I think that the hon. Member will understand that we are committed to overcoming difficulties in the way of open channel or CB. [HON. MEMBERS: "He has said it."] I have said "CB" several times. It is no good pretending that there are not serious

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  problems, and it is my duty to explain to the House what those problems are. I shall now come on to the question of how we will approach the matter.
  What I have said was the background to our discussion document on open channel. It drew a heavy response, which I found heartening, not because it supported our initial views, for it did not, but because it represented a real exercise in consultation, and a reaction that the Government are taking fully into account. It is perhaps not surprising that we did not reach the much larger part of the population who will not use open channel but may be affected by it, and we had to think of those people as well.
  Most individuals who responded strongly favoured a frequency of 27MHz for open channel. On the other hand, all the organisations that commented, other than user organisations, opposed this, but without having any common view of what they would prefer. Little public support was given to our proposal for a service at around 930 MHz. Nevertheless, we still see such a service as viable. It will give not only a better service than is generally realised, particularly in urban areas, but a better quality service. If it were as poor as has been alleged, it is strange that both North America and many countries in Europe are planning to introduce it, thus creating the prospect of a new and large international market. Nevertheless, it was the strong public reaction which caused my right hon. Friend in his answer to a question on 18 December, to undertake to look further at the possibility of introducing a service on a frequency lower than 900 MHz. Further studies have been made and these are now virtually complete. We have consulted widely on a technical basis with user representatives, manufacturing interests, and organisations such as the broadcasting authorities and emergency services.
  We agree that the need is pressing, and that there can be no question of waiting for frequencies which might be available only in a few years. Nor can we put our agreements with our neighbours at risk. Most important of all, we cannot select a frequency which, almost irrespective of the quality of the equipment used, can be guaranteed to cause widespread interference. I emphasise that our findings have been made widely available to those concerned, and no one has challenged on any scientific basis our assessment of the interference risks.
  Unfortunately, all the alternative suggestions that have been put to us fall foul of one or other, and frequently all three, of the constraints I have just mentioned. The 41·5 MHz frequency band—part of the band used for transmission of the 405 line black and white television
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  programmes—is a classic example. Our tests have shown that the interference risks to television reception would be higher than with any form of 27 MHz service, and indeed much higher than with one using frequency modulation. Frequencies a little higher than 41·5 MHz would reduce but not eliminate the problems, while the other difficulties would continue to apply.
  We also have to recognise that the world has already made its choice; 27 MHz in one form or another is widely used, and, as I mentioned earlier, North America and Europe are planning to introduce a service at around 930 MHz. Any other choice would be a one-off British one which no other country in the world would permit. Thus, one of the wishes of the enthusiast—to be able to take his equipment abroad—would not be met.
  One can develop that a little further. The equipment at present illegally used in this country is amplitude modulated equipment on the American pattern, although even then, some of it is obsolete and no longer permitted in America, and has quite simply been dumped here. Few enthusiasts want to take their cars or trucks to the United States, but that AM equipment is not generally acceptable on the Continent. France, Holland and Germany operate 27 MHz FM services, because their investigations and their experience have proved that the performance and the cost are similar, and the interference problems much less.
  Our task, therefore, is to make available a service which conforms as far as possible to the aspirations of the large number of potential users and to encourage them to use equipment which does least harm to the even larger number of other radio users. Supporters of open channel have stressed to me their willingness and ability to act responsibly, and they will certainly have to justify that. Before long they should have in their hands a service for their pleasure, and a powerful tool for good or evil. I mentioned personal freedom at the beginning of my speech. Personal responsibility is the reverse of that coin.
  I have commented tonight on the factors that have to be borne in mind in making a judgment. We are quite commonly accused of opposing a personal two-way radio service. That is quite unjust and my hon. Friend acknowledged that. We have not taken sides against it. We have decided to introduce a service, and we have carried out very wide consultations both to explore the difficulties and to hear suggestions. But radio regulation seeks the greatest good for the greatest number and that is what we have to continue to seek until we reach our final answer.
  Question put and agreed to.
  Adjourned accordingly at ten minutes past Twelve o'clock.