Ports (Financial Assistance) Bill

HC Deb 25 March 1981 vol 1 cc988-1042

Order for Second Reading read.

Mr. Deputy Speaker (Mr. Ernest Armstrong)

I must inform the House that Mr. Speaker has selected the reasoned amendment.

7.10 pm

The Secretary of State for Transport (Mr. Norman Fowler)

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

The Bill deals with our two biggest traditional general cargo ports, both of them of considerable national as well as regional importance. Both have been affected by containerisation and other changes in cargo handling. Both have particularly large labour surpluses. Each has a surplus of about 1,500 workers—1,000 registered dock workers and 500 others. This means a total of 3,000 or more surplus workers in the two ports and amounts to 25 per cent. of the work force of each port authority. That is the essential problem they face.

By the end of last year severance applications from registered men had virtually dried up. The Government therefore decided that the best way of tackling the problem was by means of a special severance supplement for a limited period. Neither port authority had the money to pay for that themselves. If the Government had refused to help, both ports would have had to cease trading next week. That is the measure of the crisis both ports face and explains why we have to act urgently.

This Bill is to provide the funds to pay for the special severance payments and to keep the two ports going while they are carrying through the rationalisation of facilities, rundown of manpower and improvement of working practices which they both need in order to survive.

The history is that both ports suffered sudden and unexpected losses as a result of the drastic reduction in traffic which has hit all ports, but these two in particular. Last year both ports lost between 35 and 40 per cent., of their general cargo traffic with very little prospect of it ever coming back. The effect was dramatic in the second half of the year. That meant that although they had both been very successful up to then in reducing manpower—the PLA severed 2,000 workers last year, well above target, and Mersey severed almost 600—they both ended the year with substantial surpluses of men for whom there is no work now and will not be any work in the future. No one can gain from nursing the illusion that those ports can survive as employers while paying a work force which is much too large for the traffic.

Just under a year ago when I introduced the Port of London (Financial Assistance) Bill which was later enacted to authorise assistance totalling £70 million for the Port of London Authority, I made clear the Government's general position on the ports industry. I pointed out that we had inherited an obligation from the Labour Government to help the PLA and we were honouring that and no more than that. I said that I believed that the Port of London could once again return to profitable operation, given the vigorous action that the PLA chairman, Victor Paige, and the management had shown their intention of taking, and given the co-operation that the work force had recently demonstrated so convincingly.

Despite even bigger achievements in cutting costs and reducing manpower that were envisaged, the port is still in crisis. That is the measure of the decline in the PLA's traffic since that time and of the seriousness of the problems that it faces.

Mr. Tony Marlow (Northampton, North)

Do not the points that my right hon. Friend has made about the PLA apply to many other parts of British industry? Do they not also face problems, find that they have too many workers and need to reduce their work force? Will my right hon. Friend explain why he suggests that those who work in the docks should get massive handouts of taxpayers' money while those who work in other industries in my constituencies get a much lower level of reward?

Mr. Fowler

I have sought previously to explain the position to my hon. Friend. We had a long conversation, and I thought that I had explained the matter. We are dealing with an industry in which the dock work scheme applies, and it serves no one to pretend that it does not apply.

Mr. Alfred Morris (Manchester, Wythenshawe)

The right hon. Gentleman has had a letter from the chairman of the Manchester Ship Canal Company, and the managing director of the company has been in touch with hon. Members. There are important problems affecting that company. Will the Secretary of State say a brief word about the effect of what he is proposing on that company and its employees?

Mr. Fowler

If the right hon. Gentleman will allow me to continue I shall come to that point. Not only have I had a letter from the chairman of the Manchester company; I met a delegation from the port employers.

Mr. Marlow

I am grateful to my right hon. Friend for giving way again. My constituents and many others would be more satisfied if the money involved were being used to wind up the dock labour scheme, which gives to dockers privileges that others do not have. It will provide Government money to people in a privileged position in a privileged industry. Perhaps, with the other hand, my right hon. Friend could do something to make it fairer for the rest of the country.

Mr. Fowler

I understand the point that my hon. Friend is making. The future of the dock work labour scheme is a question for my right hon. Friend the Secretary of State for Employment, but whatever divisions there may be and whatever our views on this scheme—clearly not everyone supports it or believes that it is the best way to go on—we have to consider the crisis facing the ports of Liverpool and London. It serves no interest to pretend that the crisis can magically be turned aside. Clearly, my hon. Friend will make a speech about the dock work scheme and what sould be done with it, and I shall listen to what he says.

When we last discussed the ports industry, many hon. Members, including the hon. Member for Liverpool, West Derby (Mr. Ogden), urged me to provide similar assistance for the Mersey Docks and Harbour Company. At that stage the company was carrying out studies of its business in all its aspects and the financial improvements open to it, and was drawing up its new profitability plan. That plan was completed towards the end of last year and copies were deposited in the Library. It set out a decisive programme of action for a sizeable manpower rundown, improvements in working practices and many other steps which are now being implemented by the company. The assistance provided for in the Bill is designed to help it carry on with this work and in particular with the rundown of 1,500 in manpower which is its initial target.

The position that the Government faced at the end of last year was that these two major ports of national importance had suffered a dramatic loss of traffic and were substantially overmanned. Volunteers for severance were not coming forward and a substantial increase in severance payments was needed to make any impact on the problem. Neither of them—this is crucial—had the funds to foot the unavoidable bill for severances. There was no way in which they could carry on trading much beyond the first three months of this year without Government help, both to meet their severance payments and to enable them to continue operating while the manpower rundown and other measures were in progress.

Both chairmen advised me that a substantial improvement in severance terms would be needed to enable both port authorities to make a sufficient impact on their surpluses of registered dock workers. I therefore decided, and announced on 17 February, that I should make funds available for special supplementary payments of up to £5,500 per man, which, when added to the payments available under the port industry's own national voluntary severance scheme, gives a maximum total payment of £16,000 per man for a man of—I emphasise this—20 years' service. To encourage the quickest possible response from men in the two ports and to minimise any repercussions on other ports, I also decided that the special offer should be limited to men who apply for severance between 1 March and the end of April.

The appeal and success of the special severance scheme is essential to the future of the two port authorities. The House may be interested to know that—so far as our information goes at present—1,100 dock workers have accepted the offer—474 men in London and 623 men in Liverpool. This represents more than 8 per cent. of the registered work force in London, and nearly 14 per cent. in Liverpool.

While it is obviously too early to judge whether the scheme will achieve its purpose of eliminating surplus labour in the interests of the survival of the ports, a good start has clearly been made. I very much hope that volunteers will continue to come forward at the current rate. I must emphasise that the very generous terms being offered now are available only for a two-month period. It is not our intention to repeat it or extend it to other ports.

Mr. R. C. Mitchell (Southampton, Itchen)

Does the right hon. Gentleman really know what he is doing? Does he not realise that the national dock labour scheme was worked out after years of negotiations between the employers, the Government and trade unions and after a number of industrial disputes? One of the bases of the scheme was that all dockers in all ports should be treated alike. Does the right hon. Gentleman realise that he will be storing up a great deal of trouble for himself if he takes action for two ports and not for the others?

Mr. Fowler

The hon. Gentleman says that I am storing up a great deal of trouble, but I ask him to address himself to the problem. There is no doubt about the financial crisis that the two ports face. The hon. Gentleman may generalise, but the particular problem is that unless we get a Second Reading for the Bill and provide the aid, the two ports will run out of money next week. That is why we are making a particular case of them.

I am sure that hon. Members will want to make the case for an extension to other ports. We shall listen to that case, but I hope that they will bear in mind the immediate crisis facing the ports of London and Liverpool.

The supplementary severence scheme is an exceptional measure for a limited period. Naturally, there has been concern in some other ports about the implications of these payments for their own operations. I recognise that the recession is having its effect on other British ports, and that in many of them a surplus of registered dock workers is one of their problems. But in no other port is the size of the surplus manpower problem as serious as in London or Liverpool. Nowhere else is it clear that massive severences are immediately needed for the port's survival. In no other ports is it the case that the only way of obtaining these severances is by means of additional payments funded by Government.

I am glad to be able to tell the House that when the National Association of Port Employers wrote to me recently following my meeting with its representatives about the special scheme, it expressed the reservations that have been mentioned but it also recognised the nature of the problems in London and Liverpool and hoped that the manpower reductions needed would be achieved.

The Bill involves the expenditure of £87 million of new money. The other £70 million is the money from last year's Bill and a £3 million overdraft guarantee for Mersey authorised in December. A major purpose of the new money is to pay for severances, in the first place, to pay for the special supplementary payments for registered dock workers, and secondly, to pay for about 1,000 severances of other employees in the two ports. The total provision for severances of all kinds within the £87 million is over £40 million, about half of the total of new money.

A further £13 million or so of the new money will be for necessary capital investment, much of which would have been financed in the normal way by loans under the Harbours Act 1964 but which, in the present financial circumstances of both ports, I would need for the time being to finance by repayable grants rather than by loans. The remaining sum is largely for contingencies, although a relatively small part—in the region of 10 per cent. of the total new money—is to enable the two ports to keep operating while the manpower rundown and other measures are going on.

Mr. Roy Hughes (Newport)

Does the Secretary of State appreciate the negative effect of his proposals on other ports? There is surplus labour, with redundancies anticipated, in certain other ports. When the dockers in these ports heard about the terms offered in Liverpool and London they said "No dice". They said that they would not be made redundant if there were any chance of their receiving the same treatment as that afforded to those in these two large ports.

Mr. Fowler

I understand the point that the hon. Gentleman makes. There is, however, this particular, special and immediate crisis faced by these two ports at the moment. That is the problem.

Dr. J. Dickson Mabon (Greenock and Port Glasgow)

We know it.

Mr. Fowler

The right hon. Gentleman may know it. I am glad that he knows it. He has to face it as well as know it. The Government recognise the problems but the special supplementary scheme we are setting out is for a limited period and comes to an end at the end of next month. That is one way in which we can limit the effect.

Mr. John Prescott (Kingston upon Hull, East)

Is the £13 million for capital investment an outright grant or is it to be given in loans? Why is it done in this manner rather than through the Harbours Act?

Mr. Fowler

This cannot be done through loans because of the financial position of the two ports. Their financial position does not make it possible for the ports honestly to say that they could have loans of that kind. We have arranged to make a repayable grant rather than a loan. I shall ask my hon. and learned Friend the Under-Secretary of State to go further into that matter if it concerns the hon. Gentleman.

The Bill does not attempt a detailed breakdown of this money into these purposes or between the two ports. This is because I want to retain maximum flexibility and I certainly do not want to create the impression that either port can expect by right to draw the whole, or even part of these funds unless I see definite evidence of results. Such additional funds as are provided will be found from within the unallocated contingency reserve, and will not add to overall public expenditure totals or the PSBR.

The initial cash ceilings that I shall be giving to each port will only be sufficient to meet their minimum requirements, on the basis of their own forecasts, over the next two or three months. If the Government then decide, on the basis of the results achieved, to continue with assistance, each further cash ceiling will be for limited amounts and for limited periods and related to specific categories of forecast expenditure.

I have now received interim proposals from the port authorities, for both ports, and reports from the accountants that I have appointed—from Price Waterhouse in the case of PLA and Peat Marwick in the case of the Mersey board. These set out the steps that need to be taken to improve the financial position of the PLA and Mersey. The figures in the present Bill for new money are based on the authorities' and the accountants' estimates of the maximum possible requirements that could arise over the next year or so, including substantial provision for contingencies.

As I have already indicated, I am not committed to making anything like these sums available and I do not intend to provide any assistance except in limited amounts for proven needs for specific periods and against definite evidence of achievement.

The position is this. Without substantial and rapid progress the two ports have no future. I have, therefore, made it quite clear to both chairmen that the Government's future attitude to their ports is entirely dependent on the progress that the authorities make over the next few months. While I accept that some immediate further financial assistance is necessary in each case, the Government are not committed to supporting the authorities beyond May, when the results of the special severance scheme are known, and we can then consider whether we would be justified in continuing to provide aid until the autumn, by which time I expect to have received firm plans for returning both ports to profitability. To this end I am continuing to retain the services of Price Waterhouse and Peat Marwick, which will assist with the monitoring of the ports' financial position and comment on the steps needed to return to profitability.

Mr. John Carlisle (Luton, West)

In what has been a depressing sort of speech, my right hon. Friend mentioned £13 million capital investment. Will he assure the House that this investment will hold jobs and create employment? The impression of many hon. Members, particularly of the PLA, is that some of its facilities are being reduced. I speak particularly of the withdrawal of the rail services at the grain terminal. Will the money to be invested create, or at least hold, some jobs, or are we literally, as some hon. Members feel, putting good money after bad?

Mr. Fowler

We are not putting good money after bad. It is to ensure that this does not happen that Price Waterhouse and Peat Marwick are reviewing the position. There is no question but that this is a difficult situation. I ask my hon. Friend to believe, however, that although it may be reassuring and nice to believe and to hope that we are not in the position that now exists, we are actually in this position. We must somehow, in my view, get out of it. I am seeking to try to put forward a progress plan which is checked at every stage along the way. The last thing that we want, and the last thing that anyone in the PLA or in Liverpool wants, is to put, using my hon. Friend's term, good money after bad. That is not our intention.

At any successive stage I shall be prepared to provide assistance under the Bill only if the authorities can demonstrate substantial progress towards reducing manpower and eliminating restrictive working practices, and if I am convinced that all concerned are committed to making the changes that are needed.

For the period during which the two ports are dependent on assistance under the Bill I intend to introduce suitable arrangements, agreed with the two boards, for regulating and safeguarding the outflow of public funds. Details of those arrangements are being discussed with both authorities and will, of course, need to be agreed before any payments under the Bill are made. In the case of the PLA, I shall require it to use the proceeds of disposals of assets—especially the compensation it is likely to receive in return for the substantial area of surplus land in the Isle of Dogs which may be transferred to the Docklands development corporation—to offset the assistance. A similar requirement will not be possible with Mersey, as the proceeds of land sales pass direct to the company's stockholders and it has no other disposable assets of any significant value.

I turn to the specific provisions of the Bill. Clause 1(1) provides for financial assistance for measures taken by the authorities to reduce the number of persons employed in their ports, or adjacent ports, and for the carrying on of the undertaking while those measures are being taken.Those provisions parallel the ones in the Port of London (Financial Assistance) Act 1980, in particular, extending the special supplementary severance scheme to apply to the registered dock workers or private companies in London and Liverpool.

Clause 1(2) enables financial assistance to be given in the form of grant, loan or guarantee, and also provides for the attachment of conditions, including conditions requiring repayment when the authorities' financial position permits. Clause 1(3) sets a new limit, and clauses 1(4) and 1(5) provide for the inclusion within that limit of payments made under the Port of London (Financial Assistance) Act 1980, which is repealed under clause 1(7).

Clause 2 concerns the limit on borrowing by the National Dock Labour Board. There are two points here. First, if the PLA and Mersey secure the numbers of severances of registered dock workers that they want, that will not only lead to the expenditure that I shall meet under clause 1 for the £5,500 topping-up payments, but will require payments for the basic amounts under the industry's national voluntary severance scheme.

Secondly, the scheme also has to meet the cost of severances in other ports. My right hon. Friend the Secretary of State for Employment will need to provide further loans to the National Dock Labour Board to finance national voluntary severance scheme payments to registered dock workers—not only in London and Liverpool but in other scheme ports that have surplus labour problems. Those loans will be repayable from levies on all registered port employers.

The present limit on borrowing by the National Dock Labour Board, under section 3 of the Dock Work Regulation Act 1976, is £30 million. Clause 2 proposes that that limit should be increased to £50 million, or such greater amount, not exceeding £90 million, as may be specified by order of the House. My right hon. Friend the Secretary of State for Employment calculates that on the basis of present national voluntary severance scheme terms, the lower figure should accomodate both loans already made to the NDLB and those estimated to be needed during at least the next couple of years. As in the past, he considered it desirable to make provision for increasing that figure if in the longer term that proves necessary. He does not envisage that the higher figure will be needed in the foreseeable future but believes some flexibility is needed to respond to changing circumstances, if necessary without further main legislation. He will, of course, expect the industry to continue to make the maximum contribution possible towards meeting its needs through severance levies.

I wish to say a word here about the Opposition amendment. If it were to be passed its only effect would be to deny Government assistance to the ports of London and Liverpool. It would not help any other port. A new Bill would be needed for such a wider purpose. The effect of the amendment would be that the ports of London and Liverpool would be in danger of ceasing to trade on or shortly after Wednesday of next week. I hope that the Opposition will think again about pressing the amendment.

I understand that there are differences between us. As I understand the Opposition's policy they favour a general subsidy. Their amendment would have that effect. I do not believe that that would be a proper use of the taxpayers' money. I also believe that it would be a recipe for waste and would merely enable the ports concerned to avoid facing the real problems confronting them and to avoid the real merits of greater efficiency.

One option that we must rule out for any port is a permanently subsidised future. That would be a soft option for everybody but the taxpayer. That option was specifically rejected by the Labour Government. Our approach is that the ports should operate in full competition with one another and meet the normal tests of commercial success. That is the clear aim for London and Liverpool. The only object of the Bill is to help them get as quickly as possible into a position where, having tackled their overmanning and structural problems, they can look forward to a soundly based future.

That will be possible only if the management and work force continue building on the recent encouraging steps towards making the necessary changes. I emphasise that it remains for the ports and those who work in them to convince me that they can continue to justify such assistance.

7.56 pm

Mr. Albert Booth (Barrow-in-Furness)

I beg to move, to leave out from "That" to the end of the Question and to add instead thereof: 'this House declines to give a Second Reading to a Bill which in making provisions for financial assistance to restore the profitability of port undertakings includes the Port of London Authority and the Mersey Docks and Harbour Company but provides no assistance for this purpose for Tyne and Wear, Middlesbrough and Hartlepool, Hull and Goole, Grimsby and Immingham, Wash Ports, East Anglia, Medway and Swale, South Coast, Plymouth, Cornwall, Bristol and Severn, South Wales, Manchester, Fleetwood, Cumbria, Ayrshire, Clyde, Aberdeen, or East Scotland.' The House has listened in vain for some sign from the Secretary of State that he understands that the problems of London and Liverpool are not peculiar to two ports but are two examples of a most serious docks industry crisis. It is an industry-wide crisis, with certain highly specialised charateristics that are readily identifiable by those who know the industry. The first is the inability of so many ports to balance their financial accounts, which results in many of them being threatened with collapse.

Another characteristic is the manpower surplus. If the Secretary of State has attempted to provide any justification for isolating London and Liverpool from the remainder of the ports industry, it has been on the basis of the manpower surplus, but the surpluses are by no means peculiar to the two ports. They exist to a greater degree in a number of other ports.

I have taken the trouble to acquire the surplus figures for the fourth quarter of 1980, during which there was a 15 per cent. surplus in the PLA and a 17.5 per cent. surplus in Liverpool. In Bristol and Severn—no one can say that Bristol is without problems—there was a 19 per cent. surplus. In Hull and Goole, it was 22 per cent.; in the Clyde, including Greenock and Glasgow, it was 25 per cent., and in Manchester it was 36 per cent. If we were to pick the ports that should be supported by a Bill that isolates two or more of them on the bases of their labour surplus and the degree of problems that they face pro rata to the surplus, London and Liverpool would come a long way down the list.

Yet another characteristic is the increasing burden of funding the severance scheme of the National Dock Labour Board.

Mr. Fowler

The right hon. Gentleman has stated only half the position. The other half is that London and Liverpool are on the verge of bankruptcy; so much so that bankruptcy comes next week. That is something that he should also bear in mind.

Mr. Booth

It is hard for me to take that advice from the Secretary of State. Nearly a year ago, when he brought forward the Port of London (Financial Assistance Bill), we told him that other ports would be facing bankruptcy. I am well aware of what he says, and I shall deal with some of the financial difficulties that face the industry. When a port is facing bankruptcy and the right hon. Gentleman brings forward a Bill to put it right a fortnight before the receivers move in, he should be prepared to give the same assurance to other ports. I suspect that a number of them will be queuing up within the next 18 months for similar treatment.

Mr. Fowler

There is no other port in the country that faces all these conditions and that does not have either the reserves or a place to which to go for further funds. That is the difference in this case.

Mr. Booth

I do not accept that, and on looking around these Benches I see ports' representatives who could speak on the matter with greater knowledge than I can. However, I can give the Secretary of State examples of the financial crisis that is facing other ports and the extent of the increasing burden of funding financial severance and meeting the loans as they become due. It does not happen only in London and Liverpool. As the employers take on higher contributions under the present arrangements for severance payments, so their ability to charge at rates that will enable them to recover or even sustain trade is diminishing in a number of ports, including London and Liverpool.

The most terrifying characteristic of the docks crisis is the lack of any strategic Government policy to enable British ports to take advantage of the technological revolution that has taken place in the industry and to deal with the challenge of some of the major changes that have taken place in the trade.

Dr. Oonagh McDonald (Thurrock)

I wish to support what my right hon. Friend is saying. What is happening in this country is quite unlike what is happening in France. I shall quote from the latest edition of The Port newspaper. An article on the ports of Dunkirk and Rouen is headed: United Kingdom docks groan under the depression—but the French turn an exuberant face, and it says: Dunkirk: State aid lets the expansion go on—and on". In the midst of the recession traffic in Dunkirk increased by 1 per cent. in 1980 compared with 1979, and in Rouen the increase was about 7 per cent. That shows the importance of State aid, and the lack of a proper Government policy of State intervention is the reason for the present serious financial difficulties of all our ports.

Mr. Booth

I thank my hon. Friend for what she said. If the Secretary of State does the same for our ports as the French Government do for French ports, I shall not accuse him of a retreat to Dunkirk, and I shall welcome him with open arms.

Two major factors are involved in the present crisis. The first, clearly, is the dramatic fall in trade through our key ports. The other is the decline in jobs that has occurred as a result of the container revolution. Here I am talking not just about the decline in absolute terms but about the movement of jobs away from the traditional points of the jetty and the quay. The container revolution has moved inland a number of jobs involved in handling cargo from factory to ship. Unless we change our dock scheme to take regard of that fact we shall face problems of increasing severance and of increasing severity.

The measure of the rundown of registered dock workers is quite dramatic. In 1947 there were 80,000 registered dock workers in this country. By 1967 the number was down to 59,000. By 1977 it had reached 29,000, and today there are fewer than 23,000 registered dock workers in the industry. It is forecast that the total labour force of the industry will decline to 55,000 by 1985.

Such a rundown of registered dock workers would have been inconceivable, given the history of bad industrial relations in the past, had we not had a dock work severance scheme and a National Dock Labour Board that could maintain a continuing dialogue between the employers and unions in the industry to deal with the rundown on a civilised basis. When I was in office I was convinced that we should carry that approach a stage further and have a modern type of dock labour scheme, but that was rejected by the Government when they took office. I believe that the national dock labour scheme that we now have, the severance scheme and the promise of a new dock labour scheme have enabled the country to accomplish such a massive rundown of labour in an industry which, traditionally has feared the loss of job security, without virtually a day's loss of work in our docks.

A major response is required from the Government. We need the new scheme now under the 1979 Act in order to restructure registered dock work. That Act, for which I had some responsibility, obliges the Secretary of State for Employment to lay a new scheme before the House. When will the right hon. Gentleman discharge his statutory duty, and when will we get a chance to look at the scheme that the Government feel should come into being for registered dock workers in British ports?

We also need loan funds on a basis that will provide for worthwhile developments and sustain some of our ports through the present conditions, because they are unquestionably not viable. We should also consider some central regulation of investment and pricing policies for our ports. The Government have failed to come to terms with the scale and nature of the crisis in our ports. They are indulging in an ad hoc, piecemeal approach to a problem that can be solved only by a national plan. I do not believe that there is any other way to deal with our ports crisis.

It is interesting to hear the Secretary of State insist tonight that there is an immediate crisis in two ports. A year ago he denied that fact. Even some of his hon. Friends tried to change his mind. I remember the right hon. Member for Crosby (Sir G. Page) telling him that he would deal with Liverpool, but the Secretary of State disagreed. I suppose that we could have some sort of arithmetical progression. Next year the Secretary of State could say that the problem is affecting only four ports, and the year after it could be eight ports, but by that time our ports industry could have gone down the drain. We cannot deal with the problem only when ports are on the brink of bankruptcy.

Let me give an example of another port that is in immediate and serious financial trouble. What does the Secretary of State think of the ability of the port of Bristol to survive for a further 12 months under the financial regime of the Government? In addition to the Secretary of State refusing to aid the port as he is aiding London and Liverpool, the Secretary of State for the Environment is refusing to allow the local authority to sustain it at this difficult time.

Mr. Arthur Palmer (Bristol, North-East)

Is my right hon. Friend aware that if nothing is done for Bristol soon half the rates in the city will go to support that port?

Mr. Booth

I have the gravest of reservations in responding to my hon. Friend's suggestion. He certainly knows the rates position in Bristol much better than I do, but, as I understand the policy of the Secretary of State for the Environment, it is imposing stringent limits on the ability of local authorities to adopt policies that would mean a massive increase in their expenditure, even where they believe that it is essential to sustain such expenditure.

Mr. Donald Anderson (Swansea, East)

Do not the Government have a special responsibility in respect of Bristol, since all those who are familiar with the ports industry in the Bristol Channel warned them in the 1960s that by allowing the Portbury scheme to proceed they would be creating a white elephant because of the surplus capacity that would be provided?

Mr. Booth

That is why the Government should have been more keenly aware of the problem. However, they have made it more difficult to be warned of uch factors by their refusal to countenance having any body to look at the relative merits of port investment proposals.

Mr. Marlow

Will the right hon. Gentleman remind the House who made the decision to go ahead with the West dock at Bristol?

Mr. Prescott

It was the Tory Government in 1972.

Mr. Booth

I believe that the decision was made in 1972, but to be fair in terms of the full implications of the question I should explain that the proposal had been put to the National Ports Council before that, and it was initially rejected. It went back to the NPC again, and the council agreed to a limited and later development. However, it is part of the contention of the people of the port of Bristol and the local authority there that had they been allowed to devolop the facilities sooner they would have made a lot of money on them. The straight answer to the hon. Gentleman's question is that the decision was made by the Government in 1972.

The Secretary of State is now destroying the only remaining national body capable of giving him an assessment of the wider needs of ports or of the merits of investing in one port as opposed to another. I refer to this proposal in the Transport Bill to abolish the National Ports Council. He has created the position in which he turns to Price Waterhouse and Peat Marwick Mitchell to advise him on the problems of two ports in crisis. But he will have no body to look at the whole industry. The right hon. Gentleman may well go down in history as the man who engineered a boom for accountants at the cost of running down a major part of this country's port industry.

The Bill shows the Government's complete inability to grasp what is happening in Britain's ports. It is inadequate as a response both to the national ports position and to the problems facing London and Liverpool. When he receives the full reports from the accountants, I believe that he will be able to conclude only that some substantial measure of financial reconstruction is needed for the Port of London. That conclusion could have been reached a year ago if the Secretary of State had been prepared to view what was happening in a wider context.

The Bill creates an artificial distinction between London and Liverpool and the rest of the ports industry.

It poses problems for the operation of the severance scheme, and that can only be detrimental to a number of other ports. Although the Bill will provide for an additional £5,500 severance for every registered dock worker to leave London and Liverpool, for every such £5,500 the National Dock Labour Board severance scheme will have to find £10,500. The board will have to pay £2 for every £1 that it gets under the Bill. That will create a financial problem for the severance scheme. I predict that the board will be forced to borrow more money in order to meet the additional burden. If it is to receive loans under the Bill, how is it to pay the interest on them?

Mr. Harry Cowans (Newcastle upon Tyne, Central)

Does my right hon. Friend agree that the Bill is designed to rob Peter to pay Paul, but will end up doing neither? The only way in which the board will raise money will be to increase the levy, and that will step up the pressure on the provincial ports. Within the next two or three months there will probably be another Bill to save other ports that, because of the increased levy, will be put in the same position as London and Liverpool.

Mr. Booth

My hon. Friend raises a very serious problem that will be created by the Bill in respect of the operation of the National Dock Labour Board severance scheme. If the board is to borrow money to pay nearly twice as much in severance payments as the Bill will provide, it will face the problem of paying the interest. I understand that the levy currently brings in about £13 million a year. The figure is based on a percentage of the wages bill of the registered dock labour force. When severance takes place the number of registered workers falls. But a greater amount of money will have to be raised to meet the interest charges, and that will have to be based on a smaller number of employees. One can conclude only that it will not be long before the level of interest payments is such that that will swallow up the entire levy, leaving nothing to meet future redundancies under the scheme.

Mr. Kevin McNamara (Kingston upon Hull, Central)

Is not my right hon. Friend understating the case? The port of Hull, for example, carries a surplus of over 300 dockers. It will have to pay an additional levy, which means that the dues and fees for the port will have to go up in order to meet it. Employers in the port could be forced out of business and that would mean dockers standing around doing nothing. The employers would be unable to pay them severance, and that would lead the dockers to ask, quite rightly, why a Hull docker is not as good as a Liverpool docker.

Mr. Booth

My hon. Friend raises another dimension of the problem. However, the contribution of levy is based on a flat rate of 3½ per cent. across all ports, plus an amount that varies between ports so that they bear the cost of severance in some relation to the extent to which they call upon the scheme as a means of running down their labour forces. Therefore, some of the ports that have already faced the biggest severance payments are paying the heaviest levy. I do not believe that they could meet the burden of having to pay additional severance.

I am told by port employers that they regard a combined levy of about 10 per cent. as the maximum that they can meet in current conditions. If they are called upon to pay more their costs will be such that they will be unable to sustain their trade. If their trade runs down that will create further problems of severance. These major problems are created directly by the Bill for ports other than London and Liverpool. By introducing the Bill to help London and Liverpool the Secretary of State has effectively brought the severance plans of other ports to a halt. In other ports the port authorities cannot carry through their severance plans because their dockers ask why they should go out for less than a man receives if he goes out in London or Liverpool. Therefore, the problems of other ports are being compounded.

I put it to the Secretary of State, with no pleasure, that he has created an inevitable pressure to raise the general level of severance pay in the industry at a time when it will be hard to fund it. It will also add to the problems of competition between the scheme and the non-scheme ports.

The Bill is an attempt to sidestep a problem that cannot be dodged for much longer. The Government are being dragged reluctantly into an area where they should play a leading, major, strategic role. They have attempted to inject into the port industry a greater dose of public ownership and a greater measure of market economic force arrangements. They have done so by seeking to sell off the public interest in the British Transport Docks Board, and by assembling the ports owned by Sealink and Associated British Ports to put them into the hands of a private company.

Mr. David Hunt (Wirral)

Is the right hon. Gentleman aware that his words will be read carefully on Merseyside? There will be a great deal of concern. I do not know whether the right hon. Gentleman will refer to the problems of Merseyside. Will he let us know whether he is in favour of the provisions as they apply to Merseyside, against the background of the serious financial crisis that our port faces?

Mr. Booth

That will the be the last point to which I shall refer.

The Government, instead of addressing themselves to the problems of Merseyside, have addressed themselves to how they can sell the public interest in the British Transport Docks Board and how they can assemble the ports owned by Sea link so that they can be put in the hands of a Companies Act company. That is the priority of the Government.

An attempt at this time to inject a greater dose of private ownership and market discipline into our port industry when there is excess capacity and when there is cut-throat competition is doomed to fail and will do nothing but damage. The ports industry is essential, not only as a part of our transport system, but as a means of sustaining a great deal of our industry, which is based upon access to ports. The time has come for the Government to face the need for a realistic ports policy to deal with basic issues on which the future of the industry depends.

Finally, I shall give the answer to the hon. Gentleman's problem. I cannot advise any of my hon. Friends or Conservative Members to vote against the Second Reading of the Bill. Left with the desperate plight in Liverpool and Merseyside, we must allow the Bill to have its Second Reading. However, we should also call for maximum support for the reasoned amendment, which we have tabled as a protest against the Government's failure to deal with the true, wider and much deeper problem that faces the ports industry.

8.14 pm

Mr. Teddy Taylor (Southend, East)

The debate has been depressing so far. Although the Minister put forward his case with his usual ability and was able to answer all the questions, I have a sneaking feeling that, bearing in mind the inevitability of the problem, he might have been a little happier if he had been on the Opposition Benches, picking holes in the Bill and in the strategy behind it.

The Minister faces an impossible problem, because the Port of London Authority is in a desperate financial situation. The inevitable problem that worries us when that arises, such as in the case of British Leyland and British Steel, is that there is an awful fear that we are putting in more money not to make the problem better but to pave the way for what happens next year or the year after.

I agree that an acute problem is faced by the Minister. He suggested that there was no question of an open cheque or a blank cheque. He said that he would have periodic reviews to see what progress was being made, and that he would not provide further finance if the plan were not maintained. It would be helpful if the Minister could tell us what will happen if he is not satisfied and if the money has to be cut off. If the fears must be considered and if we must have a plan ahead of us, the Minister should spell out what happens if progress is not made. He said that the money was conditional on progress.

The industry has many horrendous problems. There appears to be a certain injustice because London, which traditionally has had more problems and probably less co-operation than other ports, receives the extra prize of the high severance payment to buy itself out of those problems.

I wish to point out to the Minister the problems of one group that could be a casualty in this crisis. The House knows from the register that I am the adviser to the Port of London Police Federation, and have been for many years. The Minister will know that the Port of London police force had no less than 400 members in 1971. At that time the force could offer a good career structure. The basis of payment was strictly related to the salaries paid to the Metropolitan force. Since then there has been a dramatic change, because of the repeated crisis that have occured in the Port of London.

Last year, for the first time, the relationship with Metropolitan Police payments was broken, because of the serious crisis facing the docks and because of the implementation of the Wright report. A link of 37 years was broken. The police were given the same increased payment as other staff. That may seem reasonable and fair in normal circumstances. However, the police are now in a unique and unfavourable situation. Because they are a disciplined force they do not have the normal negotiation rights that all other groups have in that docks community. They are not registered dockers or staff men who can represent themselves in labour relations and in negotiations in wages. They must accept what is given to them by the management. That is unfair and unreasonable.

Those who joined the police force did so on the expectation that there would be a reasonable career structure, but whereas there were 400 police officers in 1971 and 250 in 1978, there are now only 138.

Hon. Members have rightly mentioned the substantial reduction in the number of registered dockers, but the position of the police force is unique, comprising only 138 members. I do not blame the Minister or his predecessor for the problem, which has arisen naturally from the contraction of the docks. However, as he will be virtually in control of PLA policies because of the periodic review linked to the increase in finance, will he look carefully at two issues?

First, is it possible to have negotiating procedure to determine the wages of the PLA Police? The force has lost its link with the Metropolitan Police and would like to re-establish the relationship. If that is not possible, it would like a fair and reasonable negotiating procedure.

Secondly, is the Minister willing to discuss with the PLA the question of establishing a career structure for the police through a relationship with the British Transport Police or a more direct relationship with the Metropolitan Police? It would be a good idea if the British Transport Police took over responsibility for policing the docks, and it might also save cash. It could be done on a contract basis and could add to the efficiency of the British Transport Police by giving it experienced and capable officers and by establishing a contract that could be remunerative. Will the Minister consider whether the proposal would save cash and provide a career structure for that small force?

The PLA force has a superb record in providing security and in arresting and detaining criminals. Crime at ports is substantially increasing. It is more remunerative, because cargoes are more valuable. The job of the PLA force is important and has been well carried out for many years. I hope that the Minister will give consideration tonight and later, to this small group, which might suffer special casualties.

8.21 pm>

Mr. Eric Ogden (Liverpool, West Derby)

May I start by quietly asking the Under-Secretary of State some practical questions? Why is the title of the Bill "Ports (Financial Assistance) Bill", when a more accurate title would be "Port of London and Ports of the Mersey (Financial Assistance) Bill"? The explanatory memorandum states: This Bill enables the Secretary of State…to give financial assistance to the Port of London Authority". Then, almost as an afterthought adds: It also enables the Secretary of State…to give financial assistance to the Mersey Docks and Harbour Company". The phrasing could have been more equitable. It is not even a two-part Bill. It is a Port of London and perhaps Merseyside Bill.

The explanatory memorandum also states that the financial assistance will be: for measures to reduce manpower"— not investment, not maintenance, not new equipment, not dredging, not conservancy, not security, not promotion of port facilities or sales abroad. The financial assistance is for redundancy payments. Had that been more clearly explained, the Bill would have been easier to understand, although we would not have avoided all the differences across the Floor of the House.

The provisions in the Bill have a limited life. How does the Minister propose to extend them? There is a six-week life until May for the first limits on allowances, and then the possibility of extension for a further six months.

Port severance payments are of special help for special employees in special areas. The principle of redundancy payments is fundamentally sound, but difficulties arise not because a man has lost his job but because he is employed by a particular employer or in a particular sector. Ports will be treated differently. A private sector steel worker will be treated differently from a public sector steel worker. People in the mines will he treated differently. It is the old problem, not of the disability or the redundancy payment, but of the employer. Dock workers are in a unique position with the guarantee—although limited—of employment. Overmanning in any port will be continued and they will have a job for the remainder of their working life. Very few other workers can claim that. In the main they have accepted their responsibilities.

I ask the Minister to recognise, however, that it is a limited guarantee. The need will not exist in 10 years' time. I doubt whether the need will exist in five years' time. This is a limited guarantee, justified in the present circumstances. To put it bluntly, this is perhaps the price of industrial peace in the docks. This is not an open-ended commitment which will go on for ever.

I ask the Minister to recognise that even the maximum payment of £16,000 tax-tree at the present time is not an overwhelming incentive for anyone below the age of 62, or possibly even 63, and certainly not for anyone aged 61 or 60 employed in the docks, to go for the redundancy scheme. I suggest that the Minister discusses this with his colleagues in the Departments of Employment and Social Services.

If a person takes the £16,000, followed by six or 12 months' unemployment benefit, and then applies for supplementary benefit, he will be disadvantaged if he has saved some of the money. The practical advice to workers who take redundancy payments must, therefore, be to get rid of the money as quickly as possible, to buy a house, to go on holiday, or at any rate to spend it. They should not invest it, perhaps salt it away—give it to their sons, their daughters or their neighbours—because that is the only practical solution given in the conditions being imposed by the Government. If they keep the money in the bank for a rainy day, when their unemployment benefit runs out they will be denied the advantages which would come from social security be for which they would be eligible if they had spent the money. That is not what I want. I do not think that it is what the Minister wants. Buts it is a fact.

Mr. Roger Moate (Faversham)

What is the hon. Gentleman's argument? Is he against redundancy schemes? The situation that he describes has always applied. The scheme has been carried out by successive Governments. Is he against capital payments for redundancy?

Mr. Ogden

No, I am all in favour. But it is a two-edged weapon. It has advantages and disadvantages. It is a necessary evil. We are making it more complicated than need be. It is being used to buy out jobs, which was not the purpose of redundancy payments under the Labour Government. I am pointing out the practical objections in Merseyside and London to anyone jumping at the opportunities provided by the Bill. This is not as attractive to those for whom it is intended as it would be if the Minister considered some of my ideas.

The main question facing me and other hon. Members tonight is whether to give or to deny a Second Reading to a Bill which provides at least the possibility of urgent financial help for the ports of London and Merseyside. My right hon. Friend the Member for Barrow-in-Furness (Mr. Booth) has explained, and others of my hon. Friends will explain, the opposition to the way in which this measure has been introduced. The Opposition amendment, which proposes That this House declines to give a Second Reading to a Bill which…provides no assistance for any other British port, expresses sentiments which I entirely support. Every port in the United Kingdom needs help in one way or another and should have that help.

The question is whether we should tonight deny a Second Reading to the Bill because it does not provide more. I agree with most of my right hon. Friend's comments. I certainly support action to provide financial help for other ports. But given the situation on Merseyside, with which I am most familiar, must I tonight accept the possibility that if the amendment is carried, that help will be denied, simply because help is not provided for other ports?

I appreciate that my right hon. Friend gave me the opportunity to explain my objections at a meeting of interested Members at 11 o'clock this morning. I did not arrive back from Liverpool until 5 o'clock this morning, and even I need some sleep at some time. That is why I was not at the meeting. But the amendment was already on the Order Paper. There was nothing that I could have done about that at 11 o'clock this morning. I must therefore put it on record that the tactics being employed officially by the Opposition tonight are different from those that we employed on the Port of London (Financial Assistance) Bill some 12 months ago.

Mr. Booth

I appreciate the reason why my hon. Friend could not be present at this morning's meeting. However, he should appreciate that the debating rules of the House require a reasoned amendment to be prefaced by the words declines to give a Second Reading". That does not preclude an hon. Member from supporting a Second Reading subsequently.

Mr. Ogden

With respect, I think that I have been in the House as long as my right hon. Friend, and I think that I know some of the rules, procedures and tactics which must be employed. I was making the point that the tactics that we adopted on the Port of London legislation were different from the tactics adopted now. Merseyside Members practically took over that debate. We did not say that we would oppose financial help for London simply because help was not given to Merseyside. We stated that we wanted equivalent help for Merseyside, but we did not oppose that legislation.

Merseyside Members have asked successive Governments for help for at least 17 years. If robes are ever provided for Members of Parliament, Merseyside Members should be given saffron robes and begging bowls. That has been our prime occupation. We have constantly asked the Government for aid.

All that I am saying is that if the amendment is a tactic, a better form of words might have been used. As it stands, my right hon. Friend is asking us to support his amendment knowing full well that it will be defeated.. Another approach could have been used.

Mr. Prescott

Will my hon. Friend give way?

Mr. Ogden

Not at the moment. A bitterness is creeping into Merseyside. I believe in Opposition solidarity, workers' solidarity and port solidarity, and no one can complain about lack of support from the members or ports of the Mersey. However, that kind of reciprocity has sometimes been missing in other industries.

It was particularly noticeable that when Liverpool Roadline was closed down the work went to Manchester. It was also noticeable that when Standard Triumph at Speke closed the work went to Birmingham. In the last few weeks it has been bitterly noticed that when Tate and Lyle closes down Greenock and London will not say "There is no way in which we shall take the work from Merseyside."

That is the background to the current feeling that Merseysiders will have to look after their own. My choice tonight is simple. I can go into the Opposition Lobby hoping that we shall be defeated. But let us suppose that the amendment is not defeated. We would then have to wait another 10 days before it could again be brought forward, if another Bill were brought forward. That is not a risk that I can take.

Alternatively, I can abstain. However, the Bill provides the help for which we have been asking, although it is not as much as we would like. The help is desperately needed. Do not deny this to Merseyside simply because at present help is not available to others. Let us take what we can and continue to call for help for the other ports.

8.33 pm

Mr. Barry Porter (Bebington and Elleswere Port)

I am pleased to follow the sensible speech of the hon. Member for Liverpool, West Derby (Mr. Ogden). It is the sort of speech that one expects from the hon. Gentleman.

I do not understand what the hon. Member for Kingston upon Hull, East (Mr. Prescott) and the right hon. Member for Barrow-in-Furness (Mr. Booth) meant by "a reasoned amendment". There is nothing reasoned or, indeed, reasonable about it. The hon. Member for West Derby made that point, and it is not for me to intervene in the Opposition's internal rows. No doubt they can sort them out in some other place at some other time.

Any Labour Member who has any thought of saving these two ports from imminent bankruptcy should not support the amendment, because it is always possible that hon. Members will be taken ill and that the place will fall down. One cannot guarantee that there will be enough Government supporters around to see the Bill through. I note with interest that the Social Democrats do not seem to show much interest in these two major ports.

Mr. Ogden

Nor do the Liberals.

Mr. Porter

Given the launch of the Social Democrats' great new party—as they like to think of it—they may have seen fit to think about the difficulties that real politicians face every day.

I am probably the only hon. Member to make my living and to have been born, bred and educated in the port of Merseyside. When I first became aware of the port in the mid- to late 1940s, it was bustling. The great Cunard liners were there. I was there when the Queen Mother launched the "Ark Royal" in 1950. The whole of the South docks was thronged with men. The overhead railway took men throughout the port of Merseyside. Birkenhead had all the North American trade—the corn and flour. All that has changed. In this House and outside it the question why and how has often been debated. The port of Liverpool is still overmanned by 1,500 men.

I listened with interest when the right hon. Member for Barrow-in-Furness spoke about the percentages in other ports. However, those percentages are not relevant to Liverpool. The 3 per cent. that the right hon. Gentleman mentioned in one port might be 20 per cent. in Liverpool. The 19 per cent. that he mentioned in another might be 40 per cent. in Liverpool. In Liverpool, 1,500 men are surplus to requirements. Many of us on Merseyside are bitter about the way in which we are treated by other parts of the country. To some extent we deserve it. There are many jokes about Merseysiders. For instance, there was the man who saw the Liverpool docker stamping on a tortoise. When he was asked why he was doing that, he said that it had been following him around all day. It is relevant that such jokes are made.

Workers in the Liverpool docks, or their sons, know what it was like in the 1930s. We cannot altogether blame men when they indulge in restrictive practices if they fear a return to the 1930s. No one would want that. During the past decade the labour force has to some extent behaved better than before. The fear is going.

It saddens me to think that the great port of the 1940s and 1950s has had to bring out the begging bowl once more. Over the years the port of Liverpool has received more assistance, in real terms, than has the port of London. The Opposition criticised the Secretary of State for saying that there would be nothing for Liverpool. My right hon. Friend pointed out how much Liverpool had received in the past decade. In those circumstances, how can anyone suggest that there should be opposition to giving the Bill a Second Reading. [Interruption.] The Opposition motion declines to give the Bill a Second Reading. [Interruption.]It may well be a hallowed formula. I do not think that hallowed formulae are going to go down too well with the lads on the docks in Liverpool. They do not go in much for hallowed formulae, except for working the welt. I am not going to explain that.

The dockers of Liverpool and Merseyside generally want to see a serious attempt by the Mersey Docks and Harbour Company, by the Government and, they would hope, by the Opposition to make the port of Merseyside a viable and sensible employer of labour. The only way in which we are going to do that is by making it possible for the company to survive and for the dockers who remain in that port to have permanent, sensible and genuine jobs, so that the jokes about Merseyside dockers need never be repeated. Why should they be? Many of these men work hard. The ones who remain in a viable enterprise will need to have no fear and no requirement to indulge in restrictive practices.

That is why I welcome the Bill. Rightly, a Government do not push out public money merely because somebody asks for it. It is given after careful, searching examination. This is the only way in which that major port can survive.

8.42 pm

Dr. J. Dickson Mabon (Greenock and Port Glasgow)

I respond to the hon. Member for Bebington and Ellesmere Port (Mr. Porter) by saying that the parliamentary mechanism of a reasoned amendment is the only procedure that is open to us other than voting against the Second Reading. My right hon. Friend the Member for Barrow-in-Furness (Mr. Booth) said that the Opposition would not vote against the Second Reading. If the reasoned amendment were carried, the Minister would be obliged to bring in tomorrow a Bill that, if he were responsive to the House after having been defeated, would include provisions in addition to those now in the Bill.

I have been in the House of Commons for 25 years and I have seen the Conservative Party nationalise Rolls-Royce in one day following our parliamentary procedures. Let us have no nonsense to the effect that if the Minister lost the Bill tonight it would be lost for ever. It would be the volition of the Minister in defiance of the House if that were to happen. What we are trying to argue tonight—the reasoned amendment is a symbol of this—is that so far as the Bill goes it is acceptable, but it does not go far enough. It is a Bill of inequity. It is inequitable between man and man and between port and port. It is downright unfair to the British nation, because it suggests no comprehensible way to deal with the problems of our ports.

I represent a good port—Clydeport-which has made profits for the last 14 years but which is about to declare a loss. It is seriously embarrassed by the Bill, inasmuch as part of the way in which it can avoid a continuing loss is to persuade some of its men, with great reluctance, to leave the industry. They will join a massive unemployed force on Clydeside. In my constituency we are inviting 27 dockers to leave to join an unemployment register for males of 16 per cent. Many of these are highly skilled men. That is asking a lot.

I sympathise very much with my hon. Friend the Member for Liverpool, West Derby (Mr. Ogden) in his dilemma and with his story of what happens to these men once they accept redundancy. The Minister has been told what happens on Clydeside. He must be close to Ethelred the Unready in terms of being a Minister if this is the way in which he is going to deal with the situation. Today it is London and Liverpool, but tomorrow it will be Clydeport, or somewhere else. That is what we are extremely worried about.

We do not want these emergency, crisis Bills. A crisis Bill is brought in by a had Government, who treat their Ministers badly, by a bad Minister, who cannot comprehend what is happening, or by a bad Department, which does not inform its Ministers. It is one of these three things that is wrong with a crisis Bill, or perhaps it is all of them. I do not want any more crisis Bills; I want a comprehensive Bill, which will deal successfully with the situation.

Before the Minister made his announcement Clydeport, in Glasgow, had managed to persuade 53 men to take severance pay; that was 53 out of the 60 that it wanted to leave. However, the moment this measure was announced the others would not agree. The next 60 men who were being asked to leave said "No. In no circumstances are we leaving when there is the enormous diffential of 50 per cent. between our proposed severance payments and the payments that will be made to those who work in the same jobs in London and Liverpool. If we work elsewhere we will not get this increase of £5,500".

Men have a deep sense of injustice. That applies to dockers especially. They will not take this lying down. It is requested by Clydeport that 27 of the men in my constituency should accept redundancy payments. They will not accept those payments. They refuse to do so, on grounds or principle, pride, conviction and a sense of injustice. They say that the scheme is unfair and nonsensical. The Secretary of State has made a great mistake. If he had said that he would introduce such a scheme for any port that wanted to shed its labour and to make itself economic, that would be understood. Indeed, I would vote for such a scheme, without making the gesture that we feel it necessary to make tonight to persuade the Minister to change his mind.

When the debate is over the crisis will not be over. The ports that are heading for trouble will not necessarily get out of trouble if the Bill is given a Second Reading. We are putting up a signal that will be important to the right hon. Gentleman's political career and to his reputation as a Minister. Is he to be the Minister who brings in all the crisis Bills one by one?

Those of us who do not represent London or Liverpool constituencies feel that the Department does not give a damn for any of the other ports. That may be unjust, but that is the feeling. The Forth Port Authority is lucky in that it has a great carriage of oil traffic. It is in surplus, and I hope that it will continue to be in surplus for a long time. However, it has its internal problems. The Forth ports would be in trouble if the oil business were taken from them. That is mentioned in the last phrase of the reasoned amendment.

There are many reasons why the ports are in difficulty. I accept that the Minister has no control over many of them. Let us suppose that the Minister or the Under-Secretary of State said "We shall consider this. We want you to let the Bill pass through the House because of the crisis next week. We shall seriously consider the impact on the other ports of increasing the redundancy payments to the figures set out in the Bill. We shall seriously consider the consequences for other ports that are in difficulty." If that were said, could the hon. Member for Bebington and Ellesmere Port deny the justice of the case? I hope that he would not try to do so. If that were his argument, he would be as selfish as the Minister is in claiming my hon. Friends and I are in appearing to oppose the Bill.

In essence we are not opposing the Bill. We are opposing the piecemeal and patchwork way in which the Minister has proceeded. We are condemning him for not regarding the industry through the eyes of the entire industry. We are condemning him for not considering the industry from a British point of view. It is clear that the French Government—a Conservative Government—are concerned about their ports. They are trying to maintain the structure of their ports system. Why cannot we follow suit?

Mr. Porter

If the port that the right hon. Gentleman represents were in the same situation as Merseyside and if he advanced the same arguments as those advanced by my right hon. Friend, it would be totally inconsistent for me or any one else to deny the justice of his case. It seems not to be apparent to some Labour Members that Liverpool and London are on the verge of bankruptcy, within weeks.

Dr. Mabon

I said that, and the Minister was rather annoyed. We know that there is a crisis. We have known that for a long time. We are distressed that the Minister has taken so long to recognise it. We are all worried that we shall be next. That is the essence of our argument. We can ask leave to withdraw the reasoned amendment only if there is an assurance from the Minister that London and Liverpool are not the end of the story. The effect of the amendment is that we are expressing dissatisfaction with the Minister for ignoring all the other ports.

The Minister seriously contradicted himself. At one stage he said that the Government would not apply this provision to others. Later he said that he would listen carefully to the speeches made by hon. Members and then think what he might do. I hope that he will repudiate his remark that he will not apply the provision to others. He may have to in a mustle-bustle-Ethelred-the-Unready way.

This measure makes the position on Clydeside worse. It hastens the day when we shall come cap-in-hand seeking a Bill to assist us to get back on our feet in Clydeside. We want the Minister to learn his lesson and to realise that the ports must be run in a comprehensive, understanding way, which does justice to each port, each docker and the country.

8.50 pm

Mr. William Waldegrave (Bristol, West)

Hon. Members who represent Bristol constituencies are grateful for the unusual interest which the affairs of Bristol have attracted. I only hope that it is not a transitory interest and that other aspects of our great city will also receive attention. I sometimes feel that we are being used as a pawn in a wider game.

My right hon. Friend the Secretary of State has done many things for Bristol during his term of office, one of which has been to halve the cost of bus fares between Bristol and London. That is one cost that has gone down.

Mr. Prescott

Will the hon. Gentleman accept that because of a strike in that area Bristol has the highest bus fares in the country? This leads to disputes and to people not travelling on the buses.

Mr. Waldegrave

The hon. Gentleman would be well advised to restrict himself to interventions about his own bus company, because he might get out of his depth in talking about others.

Mr. Deputy Speaker (Mr. Bernard Weatherill)

Order. We must all keep off buses.

Mr. Waldegrave

I shall be delighted to keep off buses, Mr. Deputy Speaker. The problems facing the Port of Bristol Authority are fairly well known. On several occasions the hon. Member for Bristol, North-East (Mr. Palmer) and I have urged the Government to help us. Of course, Bristol must take the ultimate responsibility for its own development. It is no good going back over ancient history. It might have been better if the Labour Government in 1968 had given permission to start the development. We know from Crossman's diaries why they did not. In 1977 the Conservative Government gave us permission to go ahead with the West dock, but it is Bristol's money and Bristol must ultimately take responsibility.

I pay tribute to the Labour council in Bristol, which is showing courage in looking for ways of putting the dock back into the private sector, where perhaps it should be. That is being done with no help from elements in Bristol further to the Left, who are being marshalled by the right hon. Member for Bristol, South-East (Mr. Benn).

Mr. Palmer

The hon. Member was not in the House at the time, but it was a Private Bill.

Mr. Waldegrave

I hope that the hon. Gentleman will agree that Bristol must ultimately take responsibility for its own development.

The situation has been worsened for us, as for many other ports, by the action which, understandably, the Secretary of State feels he has to take for Liverpool and London. Bristol's problems are very severe. In February, for example, we had 600 dockers over requirement, which is a large number. I have been in close touch with the Secretary of State and the Port of Bristol Authority on this matter.

An additional problem is that one of the last private stevedore companies in the port, which has to take its share of dock labour, has announced that it is forced to go out of business, giving as one of the reasons its inability to reduce its labour force sufficiently to meet the lower level of trade.

The manager of the Port of Bristol Authority, Mr. Turner, has put it to me in the strongest terms that previous experience shows that it is impossible to create a port differential for voluntary severance payments. It is hardly surprising, as it is a national scheme, that the negotiations rapidly become national and that that has happened. I cannot resist quoting from a letter, one of several that Mr. Turner wrote to me. He expressed his fears that the dockers in Bristol would at once ask for the severance payments at the same level as those for dockers in Liverpool and London. In brackets added at the end of one paragraph he states: In the course of dictating this letter I have just been informed that this has, in fact, happened today. That letter was dated 19 February. Thus, there has been a quick response on this matter.

There is no doubt that voluntary redundancies have completely dried up in Bristol, as in other docks around the country. I sympathise with the Secreary of State and the other Ministers who are facing the terrible problems in th docks nationally. However, the Bristol dock is caught. I accept that ultimately Bristol must take the responsibility and find ways of lifting the burden off the rates. It is sensible of the council to introduce schemes to bring private money and private developments into the docks.

Mr. Anderson

Will the hon. Gentleman confirm that the Bristol city council has asked the British Transport Docks Board to take over responsibility for the port?

Mr. Waldegrave

The Bristol city council has been talking to a much wider group than that. It would be willing to sell the dock to the hon. Member if he wished.

It is not that the Port of Bristol Authority is facing bankruptcy. If the dock were a separate trading entity it would be bankrupt, I am sorry to say. I do not want to cause alarm and despondency, but I think that everyone in Bristol—certainly every ratepayer and every dock worker—knows the facts. Redundancies are urgently needed, but not only among registered dock workers. Part of the problem is that other workers in the docks, not registered dock workers, will ask for higher redundancy payments as well. That goes through the system.

It is hard to imagine a dock facing a greater crisis than is the PBA. Bristol must ultimately take the responsibility for its own problems. It is a rich city, in a rich region, and it can do so. We took the risk. Perhaps it was a wrong risk ultimately. It is a fearsome prospect, but one day we may have to face the closure of the port. Goodness knows, we cannot go on for ever increasing the rates at the speed that we are doing at present.

The situation has been made dramatically worse by a change in the rules. The change in the rules is the new subsidy. We knew that we would have to face the fact that we were not a development area. We know all the other problems that Bristol faces as a dock authority because it does not have special status, which most other docks do. This supplementary scheme—the special offer, as the Secretary of State calls it—is an additional hazard that we could not have predicted.

The Secretary of State, with his usual courtesy, has written to me today outlining the arguments that he has made in his speech. He rests his argument on a sentence in his letter, which says: Both ports"— meaning Liverpool and London— are in fact on the verge of bankruptcy. I suggest that we are beyond the verge of bankruptcy. We are caught in the dilemma that while we are trying to find ways out, by new forms of ownership, new equity participation, and so on—we are ruling nothing out—the situation has been made dramatically worse for us by the supplementary scheme.

The other side of the problem is that under the new block grant system the extra redundancy payments, which we shall undoubtedly be forced to pay, will not be eligible for grant from the Department of the Environment and we shall be caught on both sides by the Secretary of State for the Environment's new legislation. Thus, we are in a vicious circle. Those who run the port are not their own masters on redundancy payments and as a result of the new block grant system we shall suffer because of that.

We are asking not that the Secretary of State should take responsibility for our risk, which may have failed, but that he should recognise that he has added an extra burden at a most critical time when we are trying to see ways out of our difficulties. He has dried up the source of voluntary redundancies in Bristol, and the problem has become acute.

No one wishes to argue against the necessity of providing urgent help for Liverpool and London, but I am sure that all Bristol Members and ratepayers will back my request that the Secretary of State should return to the matter, perhaps at the end of the initial temporary period, and that if evidence shows that redundancies in Bristol and elsewhere have stopped he will think again about providing further help for the rest of us.

9.1 pm

Mr. Nigel Spearing (Newham, South)

I have great sympathy for the hon. Member for Bristol, West (Mr. Waldegrave) in the difficulties that he is having with the Secretary of State for the Environment. That shows how illogical and unfair the Local Government, Planning and Land (No. 2) Act has proved to be.

I shall not oppose the motion for a Second Reading, but I cannot pretend that it is welcome. No one pretends that. I understand the feelings of my hon. Friends who regret that it is not a national scheme. I shall support the procedural gesture, though, particularly for a reason that the Secretary of State will understand. I will not oppose the Bill, but I do not believe that it will achieve its end.

Clause 1 refers to measures taken with a view to restoring the profitability of their undertakings". The financial memorandum mentions measures with a view to restoring the profitability of their undertaking and for the carrying on of their undertaking while such measures are being taken. The Long Title of the Port of London (Financial Assistance) Act 1980 contained the phrase: to provide financial assistance for and in connection with, the measures taken by the Port of London Authority to restore the profitability of their undertaking by reducing the number of persons employed by them. I told the House, the Secretary of State and his advisers that that measure could not do the trick. I said that we would be back again—and here we are. London is being offered a big breakfast, much as the condemned man is given a big breakfast on the day of his execution. No one will refuse a breakfast, but the Secretary of State can ensure that the reprieve arrives between the breakfast and the gallows.

The right hon. Gentleman may appear to be doing London a favour, but his formula for long-term success could bring failure even closer, because he misunderstands the nature and future prosperity of the port of London. I do not believe that the port can be restored by the restoration of profitability that the Secretary of State seeks. I take that view partly for reasons of which the right hon. Gentleman is aware and partly for reasons that he does not want to know about.

On Second Reading of the Port of London (Financial Assistance) Bill a year ago I said that we needed a Select Committee to deal with the Bill. The Secretary of State refused an investigation of some of the charges that I made. I said that we must consider the legislation from the point of view of the long-term health of the port of London as a whole, which deals with four times as much tonnage as the PLA. In Committee I asked for a public inquiry and consultation with local authorities.

All these were turned down. It is with great regret that we come to yet another Bill for the so-called reconstruction of the profitability of the PLA. I should like to mention some of the reasons why I do not think that this is possible, contrary to what the Secretary of State thinks. The first is Continental competition.

Time after time, the Government have been challenged on the question of the Touche Ross report. The Government are keen on the Common Market and the concept of harmonisation, even to the extent of standardised water supplies for food manufacturers. This is the sort of harmonisation that the EEC pursues. Yet it does not examine the amount of public money available to ports. The Government appear oblivious to that situation. It would be easy for the Port of London Authority to attain financial viability. No doubt the accountants will so advise the Minister before long. He will be advised: "Sack all the men. Turn away all the ships. Turn it into an estate authority". The right hon. Gentleman can do so now that he has repealed the Community Land Act. There are assets and other operations involved that might just about pay their way.

If the criterion is profitability, this means the end of the Port of London as it is known today, because the Port of London Authority was not set up to make a profit. It was set up in 1908 by the House to rescue the dock authorities, which had, through competing, put themselves into bankruptcy. That shows how much monetarism and private enterprise work. The private enterprise dock companies of the Port of London were bankrupt in 1908 and the House had to intervene. The structure then created was based on assumptions that are no longer true. One big assumption was the payment of interest on port stock where a profit was made on the operation.

Frequently, the PLA makes a profit on its operation. The losses which the Department often trumpet to the world are those related to the paying of interest on capital. It cannot therefore be "profitable" in the sense of the account book. It is, however, fundamental to the economy of London. That is, perhaps, the reason why the Secretary of State brings forward the Bill. It is not simply the PLA and the people whom it employs who are being supported by the Bill. Those involved are the private firms along the river, private operations and manufacturers and other wharfingers. The curious aspect is that many of those who will perhaps accept redundancy are not employed by the PLA at all. It was never a large employer of labour in the old days. The PLA has become the residual legatee of those who are made redundant or those firms, many of them private, that have closed.

Since the last Bill there has occurred an even more ominous development. The PLA took on labour from the firms that went bankrupt. One firm in my constituency went bankrupt overnight. Men arrived for work one day to find that the firm had closed. Those men did not have any recourse to the normal redundancy Acts. To this day, some of them have not been paid for the work that they did that week. That shows the lack of security for some people in the dock industry.

Some installations along the river, which takes four-fifths of the tonnage in the real, large port of London, went bankrupt. Such was their importance for the economy of London and the economy of the port as a whole that the PLA has seen that these operations continue. It is right that they should continue. The health of the port of London as a whole is important. For that, no one except the Secretary of State has statutory responsibility.

The Port of London Authority is an anachronism in function. It provides facilities for people who compete with its own dock operations. There are many anomalies in organisation and operation which have assisted and accelerated the authority's decline.

I wish to turn to another trend which is perhaps even more disturbing. No single body apart from the Secretary of State, who does not know a great deal about it, or his advisers, is concerned with the health of the port of London at large. No one is specifically concerned with the co-ordination of the different parts of that complex organism. One of the most important parts has been lighterage traffic. The port is linked from the Medway to Tilbury to the Royal Docks and as far as Brentford by a flexible system of floating containers called lighters. They are now carrying new types of containers.

The port of London is not concentrated, as is Liverpool or Bristol. It extends over 60 or 70 miles of river. It was built on lighterage at the time when ships were lightened in the river because they were too deep to pass over the shallows. That was the function of a lighter. But the PLA has been suspect in that regard. I have good reason to distrust its attitude towards lighterage. The lighterage traffic has been reducing.

Not long ago the PLA rescued the installation at Dagenham. There are now reports—I put it no higher—that one major lighterage concern is approaching bankruptcy. I am not sure whether that report has been confirmed, but it is well founded. It is not a fly-by-night organisation, but one of the best equipped, forward looking and best organised firms. If that firm goes down there may be further work for other firms, but one of the best components in the flexible port of London will disappear. Capital assets will be distributed, up to 200, 300 or 400 lighters will be sold for scrap, and tugs will be distributed around the world. Tug engineers do not receive severance money under the ports labour scheme, only ordinary severance pay. Some thinning down may be necessary, but why should it involve the best component? Port lighterage is rather like the bloodstream of the body because it marries the remainder of the port functions.

I heard that approaches were made to the Minister asking that the PLA should intervene as an operational body, as it did for the Dagenham dock and the fixed installation. I heard also that the Minister rejected that suggestion. I make that point based on some degree of speculation. It would be wrong to assert that those are facts. But faced with the current position in the port of London and the Bill before us tonight, it would be wrong not to mention the facts as I understand them. I hope that the Minister will say something about that point when he replies.

The British Waterways Board has depots up the canals at Brentford and Enfield. The firm to which I refer runs the canal barges. Not many other firms run such barges because that firm took over other firms when they went down one by one. Will water transport—which the Government want to assist—and the depots up the canals cease to operate? Will more traffic be diverted to the roads? That could happen if the Minister does not permit the PLA to take the necessary co-ordinating and succouring action.

I enter one caveat, which I should have made at the beginning of my speech. A number of tugs on the river bear my name. I have no financial relationship with them. As far as I am aware, other than many generations ago, I have no relationship with the firm that runs the tugs. I wish to make that clear because of my plea on behalf of the lighterage industry.

I forecast that we would be back here again and that the Port of London (Financial Assistance) Act 1980 would not deal with the problem in London. I am not sure whether this Bill will deal with the problem in Liverpool either. I appeal to the Minister to ensure that all the matters that I raised during Second Reading and Report stage of the 1980 Act are now considered. I do not believe that they were considered. He says that time is important, and that we must deal with the matter quickly. Very well.

We now have a new procedure in the House, known as the Special Standing Committee. We can go into Committee upstairs and spend two days taking evidence on the Bill. If the Bill receives a Second Reading, it cannot deal with matters that are not in the Bill. The principle will have been achieved, and we shall concentrate on matters other than those which understandably affected and influenced the speeches that have been made by my hon. Friends this evening. Otherwise, the Minister is clearly not determined to get to the bottom of the problem, and we may find ourselves back here again. By then, the port of London may be absolutely beyond recall. That happened in the case of the River Thames shipbuilders, on which I had an Adjournment debate. In half an hour I sketched out the vicious circle that operates when redundancy money is paid to grease the slopes to oblivion. That is what happened to that firm.

One cannot revive firms by doling out redundancy money. What happens is that one buys off trouble. so that jobs disappear for good. That is what happens with Bills of this kind. This country, London and, indeed, the British mercantile marine cannot afford to see the port of London disappear. I sincerely believe that, in their ignorance, the Government may permit that terrible and horrible prospect.

9.17 pm

Mr. David Hunt (Wirral)

I welcome the Bill. Indeed, it would be surprising if I did not, having fought so long and hard for it. I pay tribute to the work done by my hon. Friends the Members for Wallasey (Mrs. Chalker) and Bebington and Ellesmere Port (Mr. Porter) and the hon. Member for Birkenhead (Mr. Field), who, with me, tried to put the case of our side of the Mersey for ensuring the future viability of Birkenhead docks and, in doing so, the future viability of the port of Liverpool as a whole.

I join the hon. Member for Liverpool, West Derby (Mr. Ogden) and my hon. Friend the Member for Bebington and Ellesmere Port in finding it difficult to understand how the right hon. Member for Barrow-in-Furness (Mr. Booth) could say to me, in response to an intervention that I made, that he did not intend to advise hon. Members to vote against the Second Reading, but that he intended to ask them to vote for an amendment that declines to give a Second Reading to the Bill.

We were given various explanations for that. First, the hon. Member for Swansea, East (Mr. Anderson) said that it was a hallowed formula. Then the hon. Member for Newham, South (Mr. Spearing) said that it was a procedural gesture. The people of Merseyside are fed up with the use of tautological or quixotically chivalrous language or procedure to try to get round saying "Yes" to a Bill as vital as this.

Mr. Anderson

If the hon. Gentleman's dockers do not understand the words "hallowed formula", would they accept "custom and practice"?

Mr. Hunt

With due respect to the hon. Gentleman, I should not find it easy to argue the case of the right hon. Member for Barrow-in-Furness in saying that he would not vote against Second Reading but would vote for an amendment that declines to give the Bill a Second Reading. Whatever the custom and practice, I find that a remarkably difficult matter to understand, particularly when one sees that the amendment is a wrecking amendment. It asks for financial assistance for more than 40 other ports, some of which are not asking for financial assistance and several of which are not trying to sever men at present. In my opinion, it is an irresponsible amendment.

I cannot see why the Opposition cannot say that they believe that the Bill is a good one and wish it a speedy progress through the House, and then enter as many caveats as they wish about the need for a ports policy.

I pay tribute to my right hon. Friend the Secretary of State and to my hon. and learned Friend the Under-Secretary, who form the best team that we have had at the Ministry of Transport. They inherited a most difficult position with considerable over-capacity in the ports at a time when there had been no ports policy under the previous Administration.

Mr. Palmer

Further to the procedural points that the hon. Gentleman was making, does he agree that it would have been possible for the Government to introduce a Bill that sought to help Liverpool and London but was not confined to those two ports?

Mr. Hunt

I acknowledge that the hon. Gentleman has the interests of Bristol at heart and asks that question in the context of Bristol, but the immediacy of the financial crisis in Merseyside does not allow us to have a general ports Bill.

One of the difficulties about the inheritance by my right hon. Friend and my hon. and learned Friend at the Ministry was that there had been no ports policy for years. I do not know whether anybody is leaping to defend the right hon. Member for Stockton (Mr. Rodgers)—the hon. Member for Kingston upon Hull, East (Mr. Prescott) seems to be mouthing imprecations at me—

Mr. Prescott

The hon. Gentleman should read the 1979 report of the National Ports Council.

Mr. Hunt

I have read that document, and I am still looking for a ports policy.

It is salutary to see the hon. Gentleman defending the right hon. Member for Stockton, who is now forming another party and who preceded my right hon. Friend the Secretary of State at the Ministry of Transport. I never heard the right hon. Gentleman enunciate a ports policy when he was in office.

Our Ministers inherited a difficult position and now, after a long and careful appraisal, having listened to the problems that we have described for Liverpool and Birkenhead, thay have given us the Bill. I warmly welcome it. On Merseyside we have considerable and long-standing problems. I would have been pleased if the right hon. Member for Barrow-in-Furness had said something about them. I sat throughout his speech but I heard no analysis of the problems of Merseyside, although this Bill is all about them. I will not rehearse the details of the serious unemployment there, or the problems that could be caused by the potential closure of such firms as Tate and Lyle. I will not accept that closure until the final opportunity to save it has been lost, and I do not believe that it has. The Bill must surely be seen in the context of those unemployment problems, as well as of the other problems that have been described.

In welcoming the Bill I do not wish to sound as depressed as did the hon. Member for Newham, South in speaking about the port of London. The Bill will enable Liverpool and Birkenhead to be restored to profitability.

We do not see it as a permanent prop. For us it is a means of surmounting the considerable overmanning problems that are an integral and long-standing part of the Merseyside scene. The profitability study that was published last October showed that our port could achieve viability only if it were to shed about 1,500 men, improve working practices and concentrate activity in about three areas of the port. So the Bill will give us an opportunity of achieving just that.

I see the Bill in the context of the future. Liverpool and Birkenhead have some of the finest facilities in the world. They cater for almost every type of trade—bulk, grain, containers, heavy lift, or whatever. They have some of the finest dockers in the world. We therefore have every opportunity, within the context of the Bill—having been given the financial security that it will bring to the port—of looking forward to a better future. I see a great future particularly for Birkenhead.

Before I finish welcoming the Bill I want to praise the constructive attitude of the men in Birkenhead, because it is with those men rather than the men in Liverpool that I have been engaging in a dialogue. They have always adopted a constructive attitude. They have a number of ideas on the ways in which trade can be increased. I hope that the port will respond to those ideas.

A little while ago the future of Birkenhead was said to be in jeopardy. It would be if the Bill were not to proceed quickly. That era is past. Provided that we can achieve the financial stability given by the Bill there will be an upturn of trade in Birkenhead. The men have shown not only a constructive attitude but a considerable understanding of the serious problems faced by our area and by the port.

I welcome the Bill as a necessary lifeline. The hon. Member for Newham, South talked about a special Standing Committee, which would take evidence. I would not like to see that. We know the problems of London and of Merseyside. Perhaps one of the difficulties is that the problems have been aired too frequently and in too much detail. This quick solution, as long as the Bill speeds through the House, will give us the lifeline that we need and will enable us to look forward to longer-term prosperity, given the attitude of the men and of management in their determination to bring more trade to the port of Liverpool.

9.27 pm

Mr. Kevin McNamara (Kingston upon Hull, Central)

First, I declare an interest, as I am a sponsored member of the Transport and General Workers Union. In the first part of my speech I shall try to state to the House the union's attitude to the Bill.

The union's attitude is contained in the amendment. That applies also to the General and Municipal Workers Union, but I do not speak for that union. As a union, we welcome the assistance given to the ports of Liverpool and London. We welcome the additional severance pay that is being given, but why is it not being given to the other ports and docks? That is why the reasoned amendment has been tabled.

The Under-Secretary of State for Transport (Mr. Kenneth Clarke)

Is the hon. Member sure that that reflects the policy of the union? I am sure that it would like to see the Bill extended to other ports. The reasoned amendment declines to give a Second Reading to the Bill. As my right hon. Friend said, the effect of the amendment being carried would be to decline the emergency assistance to the two ports and give rise to the risk that both would close and cease trading, probably during next week. I do not believe that that is the policy of the TGWU. The Opposition are in a frightful muddle having put down their reasoned amendment, which does not reflect that policy.

Mr. McNamara

That is not so. If the Secretary of State and the Under-Secretary were beaten tonight, would they allow the two ports to become bankrupt, as they are threatening, or would they follow the direction of the House and introduce other help for other ports and dockers? The matter is not as simple as the hon. and learned Gentleman makes out.

Mr. Kenneth Clarke

rose—

Mr. McNamara

I have already given way to the Under-Secretary, who has made his point. I have made my reply. His hon. Friends have tried to get at my right hon. Friend about that matter too. We could spend much time debating the semantics of the situation, but other hon. Members wish to speak. Therefore, I shall not pursue that matter, but will consider other matters pertaining to what the Secretary of State has done.

The Secretary of State has taken arbitrary action to cut across the relationship between the port employer and the port employee, as contained in the national voluntary severance scheme of the National Joint Council for the Port Transport Industry. He has taken that arbitrary action without going through the normal procedure and without reference to the unions concerned or the employers. Having taken his decision, he puts before them a fait accompli. That can only result in poor industrial relations. The concept of a differential between those two ports and the remainder of the scheme ports will create two levels of docker. The value of a docker's job will be less in Hull than in Liverpool or London. No union can accept that.

In addition, by pursuing that policy the right hon. Gentleman is making it more difficult for ports that may wish to shed labour to do so. Following the last severance scheme in Hull, we still have vacancies. The latest agreement from the National Dock Labour Board is that we can shed a further 320 dockers. If dockers want to go, will they accept that they are worth only £10,000, when a Liverpool docker is worth £16,000? Of course they will not. They will hang on. First, they will not accept the equity of the Secretary of State's decision in setting one port against the other. Secondly, they will hang on because of unemployment. Once their jobs and security are gone, they will have a capital sum that will disappear in a few years, and no prospect of employment.

The scheme will not be successful in Liverpool, and not necessarily so in London, either. The employees' side advises its members not to accept until there is equity between the ports. Even then, I doubt whether a dock worker will leave his job with no chance of other employment. When national severance pay was introduced and we got rid of the casual system, workers could give up their job in the docks and obtain other employment. We now see dockers in our surgeries, with active years ahead of them, wanting to get back in the docks because there is no employment elsewhere.

There is an even greater problem. What will ports such as Hull do with a bill of £1.5 million a year to carry surplus dockers who will not leave—and I do not blame them? The port's high overheads continue, forcing up the cost of port dues and port facilities. The Minister talks of fair competition among the ports, but he is giving an unfair advantage to London and Liverpool. This is a serious matter. We need not piecemeal legislation but a national ports policy that recognises that ports are a national asset and uniformly treats them as such. That is the only basis on which the union believes that a proper scheme can be operated.

One thing is certain. The axeing and buying out of dockers' jobs-100 last year, 300 this year and perhaps 200 on the next occasion—will not solve the problem of our docks. That is not the way to deal with the problem. The docks must be looked at as a unified whole. It is no use staggering from one crisis to the next. This must be the third, fourth or fifth time that we have had special legislation to help the port of London, and the second or third time that we have had special legislation to deal with the Mersey Docks and Harbour Company.

Mr. Ogden

No.

Mr. McNamara

With great respect, when the Mersey Docks and Harbour Company became bankrupt, special Government help was provided to keep it going.

Mr. Ogden

Bankrupting the port of Liverpool at that time was scarcely helping it. It is 11 years since there was a Bill concerned with the port of Mersey. That does not mean that it is the third time that we have had special legislation to help Merseyside.

Mr. McNamara

If I have offended my hon. Friend. I willingly withdraw what I said. I have to do that, as I hope to have him with me in the Lobby later, when we can perhaps pursue the point. I think that I was born closer to a dock in Liverpool than was any other hon. Member. I therefore have much sympathy with the case that has been put for that port.

My point is none the less valid. It is no good staggering from crisis to crisis in the industry. There must be a valid national ports policy. The problem was illustrated by my hon. Friend the Member for Newham, South (Mr. Spearing), who spoke of the problem of the Port of London Authority's role as residual employer and the future of mercantile lighterage. I hope that the Minister will give us an answer on this. Is it true that the Port of London Authority was prevented from being the residual employer for mercantile lighterage because of objections by other private lighterage firms that wanted to take only the cream of the traffic but were not prepared to maintain the rest of the traffic between Brentford and the port, particularly with regard to British Waterways docks and British Waterways dock services?

If the Minister has intervened and said that those private firms can take the cream of the work, he is compounding the heavy loss that the Port of London Authority is making on lighterage, when taking on that work would have reduced it considerably. My hon. Friend spoke of the contradiction of the port of London surrendering work to private concerns, subsidising them and providing facilities for them and then suffering the losses that accrue.

Mr. Spearing

Does my hon. Friend agree that if, as the reports that are circulating suggest, the Minister has refused permission for the Port of London Authority to undertake this role without an undertaking that the existing lighterage organisations will fulfil all the services at present undertaken by the firm concerned, the Minister will be responsible for further reducing waterside services and the lighterage trade in the port of London and will be a party to cutting off some of its limbs with regard to the lighterage trade? Does my hon. Friend agree that the Minister has a responsibility to tell the House whether he has given that permission and whether he has intervened in the way that has been widely reported?

Mr. McNamara

My hon. Friend has made the point even more succinctly than I intended.

I make one further point on this matter. I believe that it would be right for the Minister to meet representatives of the men employed and officials of their union to discuss this matter. It is a matter of considerable concern in that area of the Port of London Authority's work.

Finally, in reply to a letter from Mr. Cronin, the national docks officer of the TGWU—the substance of which I have more or less covered in my speech—about the effect of the new scheme on severance pay and the suggestion that the Minister should do the same for other ports, the Minister said: Although I appreciate your concern about the possible implications of these local payments in London and Liverpool for the operation of the National Voluntary Severance Scheme, this is primarily a matter for port employers and trade unions in the National Joint Council for the Port Transport Industry. If a joint approach is made by the port employers and the workers within the national joint council, will the Minister ensure that funds are made available to provide an equivalent severance scheme for all the other docks? By so doing, he can end the iniquity that now exists.

Mr. Cronin warned that different treatment between dock and dock could lead to friction in the industry. If the Minister does not consider this matter more carefully, it could well lead to a serious docks stoppage—official or unofficial—that would be even more disastrous than what he is proposing.

9.40 pm

Mr. Tony Marlow (Northampton, North)

I enter the debate with a certain amount of temerity and timidity—[HoN. MEMBERS: "Hear, hear."]—as is usually the case, surrounded as I am by so many experts on ports and recognising the fact that there are no ports in Northampton. However, Northampton does have an interest, in that the people there must pick up the tab for this measure, as do others in non-port constituencies.

Every Government do not entirely succeed in what they are trying to do. If this Government have not succeeded it is because their main fault has been an inability to cut public expenditure. That has caused taxes to be higher than we would otherwise need, and interest rates to be above those that we would otherwise need. It has placed a great burden on industry and has been the cause of the unemployment from which we are currently suffering.

My right hon. Friend is asking us to provide another £87 million, which I believe amounts to £5 for every family in the country. On other occasions, we have been asked for £5, £10, £20 or £30. To what end is every family being asked to contribute £5 tonight? It is to bail out the most notorious industry that this country has ever known. It has a record of restrictive practices and overmanning. Eight men are doing a job which could be done by two. It has a record of nepotism that is second to none. It is an industry with a history of extortionate practices which would make the Mafia green with envy.

If my right hon. Friend is asking the House for this tranche of Danegeld tonight he should have the most compelling reasons for so doing. He has told us that without this money the ports of London and Liverpool would have no future. He owes the House a fuller explanation. Let us suppose that the money was not forthcoming. Would the sea disappear? Would the Mersey and the Thames dry up? Would the wharves fall into the docks? Would the cranes march down the quayside and disappear? Would the workers and their skills evaporate into the mists of the night?

As my right hon. Friend knows, other industries have suffered financial crises. They have gone into receivership or liquidation. But people have bought the assets, got hold of the work force and have come back leaner, more efficient and more effective. As a result, those firms have been better places in which to work. My right hon. Friend should explain why that is not an option that we can pursue in this case.

My right hon. Friend also said that the ports were suffering from a financial crisis. Why? I accept that part of the reason may arise from the recession. Although I do not have the same experience of the port industry as other hon. Members, I have in past jobs been involved with that industry. On one occasion I tried to negotiate the establishment of a grain-handling facility in one of our major ports. We wanted to employ our own men, but were told that it was not possible. When we eventually made the calculation we discovered that employing dock labour would cost eight times more than employing our own men.

I accept that there is a recession. However, I believe that a far greater reason for the crisis in the dock industry is overmanning, greed and restrictive practices. My right hon. Friend is asking my constituents to pick up the tab for those bad habits and the practices of the past.

Other businesses and industries face financial crises. Other businesses have records of high productivity, of moderation, of good labour relations and of co-operation. Other industries are suffering from a high pound—based on the value of our North Sea oil—and have to compete, without any tariffs or controls, with other European countries that do not have such high currencies. Other businesses have these temporary problems. If they were provided with some of this money they could survive and become much stronger.

Opposition Members have spoken about injustice. The overriding injustice of this measure is that if someone happens to have his hand in the Government's back pocket he will get what he wants. If someone works for a nationalised industry or for a port, the Government will cough up. If someone works for private industry he will get hardly a penny.

As my hon. Friend the Member for Southend, East (Mr. Taylor) said, the worse one's behaviour the better the prize to be picked up. That is one hell of a moral to give to the nation.

I sincerely appreciate the problems that my right hon. Friend and my hon. and learned Friend have with the national dock labour scheme. I appreciate that they inherited a situation that had been in being for some time. They have a difficult job to do. But why do they propose to give financial aid without attaching any strings? Perhaps I am being naive again, but why do we not get rid of an archaic system—unique save for the Civil Service—in which a registered docker has a job for life? Instead, why do we not try to give dockers a stake in their ports and in their industry so that they will wish to compete—port with port—and so that they will receive increasing benefits from their increased efficiency? That would be better than the situation that has existed for generations, whereby there has been a powerful effort to maintain the maximum number of jobs, no matter what the cost to the community.

The measure is entirely negative and against the interests of my constituents who will have to pay for it. If there is a vote on the measure I shall have to oppose it.

9.46 pm

Mr. Ken Eastham (Manchester, Blackley)

I was amazed by the speech made by the hon. Member for Northampton, North (Mr. Marlow). He seemed to suggest that the ports could close. He may hate the ports and port workers, but if there are no ports, industries—including those in his town—will not be able to export their goods. That is a sobering thought.

I do not wish to appear prejudiced against the docks in London and Liverpool. The Opposition recognise that the Minister is faced with a dilemma. He has spoken about labour surpluses. One hon. Member after another has said that all the ports suffer from a surplus of labour. Our protest is that the proposals are unfair because they refer to only two docks. This is a piecemeal Bill, which pays piecemeal attention to the problems. It does not deal with them comprehensively. As has been illustrated, other ports have difficulties.

I shall refer to a port that has not received much mention, namely, that of Manchester. There have been great difficulties. If there should be a complete collapse resulting in closure, it could have a detrimental effect on the city. Its trade and commerce are dependent on the Manchester port, which over many years has helped the prosperity of the city. We all recognise, as has been conceded this evening, that there have been dramatic changes in transport methods. No one is blaming anyone for the changes in containerisation or the new handling methods, but we can put some blame on the Government for the devastating trade recession and its effect on the ports. When ports are no longer exporting there is a serious rundown.

When the Minister is winding up I should like him to amplify on the aspects of consultation. There has been a lot of criticism of the Government because of the lack of consultation. I wish to quote an extract from a letter which was written by the chairman of the Manchester Ship Canal Company, Mr. Redford, to the Secretary of State for Transport: I am indeed surprised to read of the action you are taking to assist the Port of London Authority, the Mersey Docks and Harbour Company and presumably private employers in the ports of London and Liverpool with special severance payments to dock workers who wish to take advantage of them. I understand that only one hour's notice of your action was given to the management committee of the National Association of Port Employers. What you propose can only result in continuing and worsening unfair competition for other ports who have attempted to run their own affairs, with varying degrees of success. Operating losses which my company incurred in 1980 were due in no small measure in having to find almost £1 million in attendance payments to dock workers for whom there was no work and who are not likely to have work in the future. The action which you have in mind to take will merely exacerbate this situation. I shall be grateful if you will be good enough to let me know why, so far as I am aware, there was no prior discussion with the industry and why the financial assistance cannot be offered generally to port employers, many of whom are in serious plight. You will appreciate that the chances of persuading dock workers to leave the industry on terms less than those to be offered to London and Liverpool men are slender indeed. Those are fair comments. The Minister owes it to the House to give some explanation as to why there has been a lack of consultation and respect for the other ports and organisations. I understand that a brief reply was given indicating that the Minister was willing to help only London and Liverpool and stating that such places as Manchester were not considered to be big enough or yet broke. Perhaps we have to wait until the patient bleeds to death. Then when we come along cap in hand to ask what the Government are going to do for Manchester, Hull, Glasgow or wherever, I wonder if the Minister will exercise expediency and determination to introduce a Bill to deal with the problems.

The Minister may be interested to know that at one stage Manchester had more dock workers without work than Liverpool. It ran to 40 per cent. which is astronomical. That is the burden that was being carried by the port. Of course, Manchester is suffering its share of mass unemployment. I draw the Minister's attention to the figures published only yesterday for the North-West, and I remind him that that includes Manchester as well as Liverpool. The figures are horrific. They are higher in the North-West than in Scotland and only 1 per cent. less than in Wales.

It is ridiculous to offer enhanced redundancy payments to Liverpool alone, apart from London, when the Manchester docks are only 30 miles along the ship canal and the Manchester dockers are being offered less favourable conditions for the same work. There will be resistance from the other dock workers. It is not likely that they will accept less favourable conditions than those that the Minister is proposing in the Bill.

If the Bill is enacted, Liverpool and London will improve their position. It may be that they will become slightly more competitive, as they will carry less in overheads. The other docks will suffer from greater competition, which will take away their rightful share of the work and proportion of the trade. That is not fair and just. We ask the Minister to think again.

Manchester dock workers are entitled to no less favourable conditions. Bearing in mind unemployment levels in the North-West, it is probable that those who leave the docks will never get a job again. For the reasons that I have advanced, they are entitled to the same consideration. The Bill should be rethought. We prophesy that it will not succeed as it stands. I ask the Minister urgently to reconsider it.

9.57 pm

Mr. Roger Moate (Faversham)

It would be foolish not to acknowledge the validity of the argument of the hon. Member for Manchester, Blackley (Mr. Eastham). When two ports are close alongside each other, the differential redundancy factor will cause an even greater sense of unfairness than already exists. Some right hon. and hon. Members have failed to recognise the acute sense of grievance and unfairness that already exists about various redundancy schemes. There are many employed in the ports who are not registered dock workers. The redundancy benefits that they receive are quite diffeent from those paid to registered dockers. Many who are not engaged in the docks do not receive such favourable payments. They have the same sense of grievance and unfairness.

We know the historic reasons that have led to the dock industry workers receiving substantial redundancy payments whereas workers in other industries receive payments that are considerably less. It would not eliminate the sense of grievance and unfairness if we were to extend the scheme to other ports in the United Kingdom. To do so would merely accentuate that feeling in the minds of workers in other industries.

The hon. Member for Blackley did not explain why he and his right hon. and hon. Friends will decline to vote for the Second Reading of the Bill. The hon. Gentleman acknowledged that the Government are in a dilemma. The Opposition's response is to decline to vote for the Second Reading.

The right hon. Member for Greenock and Port Glasgow (Dr. Mabon) used all his considerable eloquence and decibel level to try to justify the Opposition's position. His sole justification was that if the Opposition were to carry the matter on a Division, although he is relying upon Conservative Members not to allow that to happen, within the next day or two the Government would spirit up a new measure and the Treasury would produce hundreds of millions of pounds for a new scheme.

The right hon. Member for Greenock and Port Glasgow, who said that he had been in the House for 25 years, should know better than that. It is totally illogical. The right hon. Gentleman has had a distinguished medical career. He should recognise that we are proposing to give an urgently needed blood transfusion to ports in crisis. His proposal is that we should give a blood transfusion to all ports in the United Kingdom, whether or not they have problems. It is an extraordinary way to treat patients, if he goes round giving blood transfusions to everyone, be they healthy or sick.

It being Ten o'clock, the debate stood adjourned.

Ordered, That, at this day's sitting, the Ports (Financial Assistance) Bill may be prodeeded with, though opposed, until Eleven o'clock. —[Mr. Cope.]

Question again proposed, That the amendment be made.

Mr. Moate

Perhaps the right hon. Gentleman, who has, I am sure, plastered many a broken leg, puts plasters on people without broken legs in case they break them later. Perhaps it is the Socialist belief in comprehensive treatment and the comprehensive handout of benefits on an unselective basis that has led to the whole country being on crutches today.

As has been explained by my right hon. Friend the Secretary of State, if this money is not granted to the PLA and the port of Liverpool, those ports will be bankrupt. The measure is necessary to keep them alive, yet the Opposition are voting against it tonight. I hope that that message gets clearly across in the ports. I do not for a moment believe that the Opposition want to see port operations close; it is just ineptitude. The justification is that it is the only way the case can be argued for the wider treatment of all ports. Reference was made to last year's debate on the Port of London (Financial Assistance) Bill. There was no reasoned amendment then, but that did not prevent hon. Members from talking about Liverpool in a debate on a London Bill.

The right hon. Member for Barrow-in-Furness (Mr. Booth) knows that he could have had an extensive debate tonight on the implications of the Bill for all the other ports without having to take a step which could result in the defeat of the Bill. That is a serious tactical error. The Opposition think that they will not win on their reasoned amendment, but many of my hon. Friends have been saying that presumably there will be no vote because the Opposition can hardly vote against this measure. They might have gone home. Perhaps the right hon. Gentleman will carry his amendment and endanger the financial position of London and Merseyside. The most courageous and honourable speech came from the hon. Member for Liverpool, West Derby (Mr. Ogden), who understands the position clearly.

Of course there is a problem for other ports. Even in the port of Medway, in my area, which is a highly successful, highly competitive and profitable port, there is surplus labour that it is felt should be dealt with on redundancy terms. The implication is that those dock workers will not now opt for redundancy, because they expect that there will be more Government support. I hope that my right hon. Friend made it clear that that will not be available.

I am sure that my right hon. Friend does not enjoy promoting the Bill, but one of its few merits is that it has a two-month limitation as a first step. It is for a limited period, for a limited purpose. It is not to bail out the ports. It is specifically to deal with surplus manpower.

The defence of the Bill is that it is deemed to deal with the crisis for a short period and, specifically, to deal with surplus manpower.

I have to deal with my final point so I cannot do justice to it. It is the question of the possible extension of the activities of the Port of London Authority into lighterage, which was extensively dealt with by the hon. Member for Newham, South (Mr. Spearing). I do not know whether a decision has been made. Some of those services are operated jointly with the Medway, so I have an interest in the matter. At a time when the Port of London Authority is asking for more public assistance it is quite wrong for it to extend its activities into private enterprise and ake over the lighterage firms in the river. At the same time that would act as a disincentive to many workers who otherwise would apply for voluntary redundancy. I understand the difficulties of this extremely complex matter. I do not feel that it is right for the taxpayer to pay for the Port of London Authority to extend its activities at a time whem it should be reducing the scale of its activities. Above all, such a step would undermine the purpose of the Bill, which is to deal with the crisis in London and Liverpool and especially with surplus dock labour.

10.7 pm

Mr. Donald Anderson (Swansea, East)

That is surely the essence of our opposition to the Bill; it is an ad hoc response to a general problem. If the Secretary of State or the Minister is now prepared to give an undertaking in the terms suggested by my right hon. Friend the Member for Greenock and Port Glasgow (Dr. Mabon), that he will give parity of treatment to the other ports that are similarly affected, I shall resume my place and there will be no further problem.

Mr. Kenneth Clarke

indicated dissent.

Mr. Anderson

What is clear is that the Minister has not thought through the effects on the other ports of the ad hoc response to a particular crisis in two ports. Hence, he has apparently not discussed the matter with the major trade unions or with the port employers, who would have informed him of the consequences. They would have told him that it would create injustice between one port and another. It is likely to lead to disruption in labour relations and to go against the existing practices that have been built up in the industry, by discriminating in favour of two ports against other ports that are similarly affected. It needs a strong justification to break from precedent, and the Minister has not given that justification.

Mr. Fowler

The hon. Gentleman asserted that I had not consulted the port employers. That is incorrect. I had a special meeting with the National Association of Port Employers. It wrote to me on 13 March and said that it none the less recognised the nature of the problems and hoped that the special supplement will succeed in bringing about the required reductions in these ports".

Mr. Anderson

In response to that I quote from a document dated March 1981 from the National Association of Port Employers: the Association regrets that it was not brought into consultation at an appropriate point in the discussions which led to the Secretary of State's announcement". So much for that point.

The voluntary severance scheme was operated hitherto as a national scheme, with its terms uniformly applied. That precedent is bad for the industry and, after a period of relative industrial harmony in our ports, is likely to lead to disruption. The Minister will be responsible for that as a result of his individual response to particular problems in Merseyside and the port of London. He must know that there will be strong trade union opposition. I understand that a special dock workers' conference has already said that it would not accept the scheme unless it were extended to other affected ports. Over 100 of the 650 severances that have been authorised have been withdrawn. Hence, that will undermine the working of the current scheme, increase the costs on the ports and reduce the competitiveness of those ports, because they will be forced to retain men, surplus to their requirements, who would have been willing to leave the port industry. The Secretary of State will know that many ports are competing for comparatively little trade and, therefore, costs are critical.

I wish to raise a point on the South Wales dimension. The recession has led to heavy under-employment in the South Wales ports, currently averaging two days a week. My hon. Friend the Member for Newport (Mr. Hughes) knows that the severance of 30 registered dock workers has been authorised at Newport, but there has been only limited success for the scheme because of the heavy local unemployment. No registered dock worker in South Wales will accept severance when he knows of the injustice of the present scheme compared with the proposed system for London and Liverpool and anticipates that there will be a further temporary ad hoc Bill from the Government to extend the provisions of the Bill before us. Ports such as Swansea will also face cost increases because of the levy.

There has been age-old rivalry in the Bristol Channel. The hon. Member for Bristol, West (Mr. Waldegrave) mentioned the financial problems of Bristol. In response to the South Wales Docks Board, the managing director of the British Transport Docks Board said: Obviously we could not contemplate taking responsibility for Bristol's heavy financial losses, nor the future liabilities associated with Portbury and Avonmouth Docks. Nor would we contemplate any policy which could sustain traffic in the Bristol Docks at the expense of South Wales. The BTDB agreed to meet the Bristol city council, and the outcome of that was discussed at a recent meeting of the South Wales board.

All the fears that those of us on the South Wales side of the Bristol Channel expressed in the late 1960s about the over-capacity in the channel—the over-capacity that would be created as a result of the Portbury decision—appear to be coming to fruition. The Western Mail stated that the BTDB will be under Government pressure to shut down a couple of the older Welsh ports in the face of falling trade and profits if it yields to the overtures of the Bristol city council to incorporate Bristol within the board. I hope that the Minister will be able to give me an assurance on that point.

The extension of the advantages in the Bill to other ports will lead to a smooth development of severance in the national interest, but the current scheme will be seen to be unfair, will embitter relationships within our ports and, hence, will be disruptive. I urge the Government to think again about their ad hoc scheme.

10.13 pm

Mr. John Prescott (Kingston upon Hull, East)

The debate has clearly shown that many hon. Members are concerned about the consequences of the policy enshrined in the Bill. There has been some controversy about the Opposition's amendment. I am advised by "Erskine May", and it appears to be so, that the reasoned amendment is a parliamentary procedure which has been well used by Oppositions of both parties to express a point of view.

Our view is that the policy is likely to discriminate, for the first time ever, between groups of dockers on the question of redundancy payments. That is the point which the hon. Member for Faversham (Mr. Moate) did not understand. Most of his speech was, therefore, devoted to matters that he had not got clear in his mind.

The Bill is essentially different from the Port of London (Financial Assistance) Act 1980, which the hon. Member for Faversham supported. He said then that it was not a precedent. This is the first time that we have had first-class and second-class redundancy payment systems for the docks. This Bill is essentially different from any Bill previously brought before the House. I have consulted "Erskine May" on the reasoned amendment. The old practice apparently was to table a reasoned amendment, but even if it were carried the Government could continue with the Bill. The modern practice apparently is that, if one is defeated, one is defeated on the day and one can come again before the House. I do not have time to become involved in arguments over "Erskine May". I commend it to the Secretary of State if he cares to read it himself. We support the Bill as far as it goes.

I was surprised to hear the remarks of my hon. Friend the Member for Liverpool, West Derby (Mr. Ogden). As hon. Members will see, many names are attached to the amendment. My right hon. Friend and I went to a lot of trouble to collect them during the last two days. It is unfortunate that my hon. Friend the Member for West Derby was unable to attend in the last two days. I could not discuss the matter with him as I did with other hon. Members. I am more surprised by his approach when I see that he himself voted for a reasoned amendment to the Coal Industry Bill on 17 June which sought to do the same thing. My hon. Friend did not wish, as a member of the National Union of Mineworkers, to deny subsidies for the mining industry. He was prepared to vote for a reasoned amendment but did not vote against the Second Reading. Perhaps his arguments are peculiar to a Liverpool Bill. It is not a practice that he has avoided in the past. A few months ago, he followed it himself.

Mr. Ogden

I do not interfere in my hon. Friend's relations with his union. He should not try to interfere in my relations with my union. The Coal Industry Bill is not the Ports (Financial Assistance) Bill. We, the Opposition, are treating this Bill differently from the way in which we approached the Port of London (Financial Assistance) Bill less than 12 months ago. That is the difference.

Mr. Prescott

My hon. Friend does not understand the Bill. This is a separate Bill. For the first time it differentiates between ports. The Port of London (Financial Assistance) Bill did not do that. We supported my hon. Friend in his demands for Liverpool. The same argument applies now. As a sponsored Member myself, I understand the appeal to the National Union of Mineworkers. It is an act of solidarity. This amendment, too, is an act of solidarity with other ports—a solidarity that we showed last year in supporting Liverpool's case on the London Bill.

Mr. Ogden

rose—

Mr. Prescott

No. I shall not give way.

Mr. Ogden

On a point of order, Mr. Deputy Speaker. My hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) is making heavy weather of where I was. I was in Liverpool, being urged by Liverpool dockers to vote for the Bill.

Mr. Deputy Speaker

That is not a point of order.

Mr. Prescott

I was not questioning where my hon. Friend was. Each hon. Member has his own pressures of business. I did not reflect on where my hon. Friend was or what he was doing. I think that that will be shown by the record. [HON. MEMBERS: "Get on with it."] Hon. Members should not tell me to get on with my speech. If hon. Members feel that I have made heavy weather of the issue, I would only say that I felt that it was important to put it before the House to justify the amendment. The essential factor is that the Bill is different from any past Bill. It seeks to differentiate between port workers in different ports. We know the reason. The Secretary of State says that the companies are bordering on bankruptcy. The Bill, however, interferes with the national dock labour scheme and differentiates between workers in different ports and employers who were not consulted but only informed what was happening. That is another broken procedure. It is an extremely controversial matter in the ports.

Our criticisms are connected with the fact that the Bill fails to reflect any ports strategy. It relies on the market philosophy that ports should be profitable and that this should be the only reason for their survival. It reflects the policy of the Government's 1971 White Paper, "Financial Policy for Ports". Unfortunately, we seem to be about to see history repeating itself. The White Paper said: The Government expects the ports to put themselves in a position where they can provide the services essential to the country's economic prosperity efficiently and profitably. They are expected, like other businesses, to be self-supporting and competitive". The White Paper said that the National Ports Council had a major part to play. The Government are abolishing it. A different policy is now being pursued on the central agency role.

We are critical of the Bill because it is selective in its approach to certain ports. We made the same criticism of the Port of London (Financial Assistance) Bill. It is now being extended to the Mersey docks. We accept that that docks must receive aid, but other ports face similar problems. We are critical of the lack of a proper ports strategy. The selective approach will create more problems than it will solve.

It has been common ground in past debates that many of the problems faced by the ports industry are brought about by excess capacity. Our ports have a capacity for about 1,000 million tonnes, but only 320 million tonnes are passing through them. We cannot simply close down the ports and public utilities. Traffic is not solely determined by price. There are technological changes relating to containerisation in Bristol, Liverpool, London and other ports. That has brought about changes in our ports. There has been a tremendous switch in our trading relationships from the West to the East, which has also affected the ports. We have seen the growth of the small to medium-sized ports at the expense of the large, deep-sea ports. One consequence of the imbalance in our trade is that it affects ports depending on where they are and what they trade in.

Excess capacity has led to such a fall in prices that the ports have not been able to carry through a proper investment programme. The market philosophy followed to its logical conclusion was to get rid of excess capacity by allowing bankruptcies. If it were decided to eliminate excess capacity, as happened in the steel industry, that at least might be called a policy. It is a problem in the ports, and we shall not obtain enough traffic within the next 10 or 20 years to feed the surplus capacity. That leaves us with a major problem of planning for the ports industry. Whatever policy is pursued, there will always be ports that will never achieve a sufficient throughput to justify a number of their activities.

Labour Party and Labour Government policy has been reasonably consistent. We believe that there should be a national ports authority. I do not have time to go into the arguments for that, but I developed them at some length in Committee. The Tory Party has been consistent only in the sense that it began with an ideological purpose—it was wedded to a marked philosophy—and has ended up with collapse and bankruptcies and has had to rush in with taxpayers' money.

Let us consider what has happened. We are not witnessing a unique formula. What the Secretary of State is doing was done by a previous Tory Secretary of State in 1971, when the Mersey Docks and Harbour Board was in considerable difficulty and wanted to borrow £6 million. That is a small sum compared with the sort of money that is now floating around. It was decided that the board should stand on its feet because the market philosophy was to reign supreme and that if it was not commercially profitable it should go to the wall. That company went bankrupt. The capital was written down by 60 per cent., which caused many people to suffer. Problems were created by small wharfs, there were the national strikes of 1972, and the Jones-Aldington solution was implemented by a Conservative Government supported by a Labour Opposition. The Jones-Aldington solution was that money should be made available for excess labour. But that additional money was to be made available to all ports and their dockers. The solution did not pick out only one or two ports. If anyone doubts that it is not only in London and Liverpool that excess labour exists, I refer them to the National Docks Labour Board report which details surpluses in every port. The national average is about 12 per cent. Even allowing for the current depression in trade, excess capacity is a problem in many more ports than only London and Liverpool. We must address ourselves to that problem.

In 1972 the Government introduced further legislation and loans, and there was a strengthening of the National Ports Council to monitor the position financially. To that extent there was a reversal to intervention. We told the Secretary of State in a previous debate on the Port of London (Financial Assistance) Bill 1980—indeed, every Opposition Member warned him—that the problems did not affect only London. I give credit to Liverpool Members who exerted powerful pressure on behalf of the Liverpool docks. My hon. Friend the Member for West Derby said that it was more of a Liverpool debate than a London debate.

The point was eventually driven home, though it took time. The Secretary of State was still flush with his free market philosophy. He came to office in May 1979, but it has been said tonight that there are still not many plans for port development. In 1978 the then Secretary of State asked for a plan for the National Ports Council for the development of the future of the ports, and that plan was ready when the present Secretary of State took office. However, he decided to call for his own report. That is understandable, but the new report came up with the same conclusions as those that were contained in the 1978 report about the future problems of the ports.

Hon. Members should consider those reports. They predicted what would happen to the ports of London, Liverpool and other towns. The information is all contained in the policy reports of 1978 and in the report given specifically to the Minister in October 1979. But what did the Minister do? He brought forward a Bill to abolish the National Ports Council and sell off the British Transport Docks Board.

If any hon. Member wishes to know about the problems of our ports he should study those reports. Unfortunately, the Secretary of State rejected the advice that he was given there. Indeed, he went further, and abolished the body that gave him the advice, because he did not like the advice. He then gave us a series of statements about port policy. In The Port of Wednesday 2 April 1980 we read: Fowler's message—`Do it yourself"— that was the new policy of the Conservative Party — The Government will intervene less in the ports industry". We told him that that was nonsense. He said that the 1980 London Bill was not to be seen as a precedent, but we know very well that it was a precedent. Exactly the same circumstances were used in the Labour policy of 1978 for the Port of London Authority, namely, to lend money, put in accountants, and monitor the progress. That is exactly the policy to apply to the Mersey Docks and Harbour Company. The tragedy is that it was relevant 12 months ago and that we have had to wait all this time.

The Minister says that the Bill is being brought forward now because the companies are bankrupt. He says "If we do not get the measure by a certain date, and because the companies are bankrupt, we have to provide money, I have a pistol at my head". That is no solution. Had he given the matter more thought he might have seen ahead and taken action. Unfortunately, he did not do that. He said that he was bringing forward the Port of London Bill because it was an obligation of the Labour Administration.

There is another quote of 6 August 1980—"No aid for ports". That was the heading on an exclusive report given to the Journal of Commerce about the Secretary of State's attitude to the ports. It was that they must stand on their own feet.

Tonight, however, we see that the Secretary of State's attitude has changed. Thai is to be welcomed, but it is tragic that we have had to wait 12 months. I do not imagine that the right hon. Gentleman is likely to change his attitude to a central agency, such as the National Ports Council or, as we would prefer, a national ports authority, but he is coming round. Like other Ministers, he is doing a U-turn.

There is one matter that worries me. In the press statement about the Bill, dated 13 March, the Secretary of State said: I should make it clear that the Bill does not commit the Government to supporting the two port authorities beyond May". I recall the "no precedent" claim of last year. In fact, I think that we shall have reason to quote it again, because surely no one believes that the problems of the ports of London and Liverpool will be solved by May, or even in a year.

Perhaps I am being a little unfair to the Secretary of State. However, if he believes that he will not have to intervene again he is mistaken. His own accountants are advising him that a financial reconstruction is needed, certainly in London and possibly in Liverpool, and that something will have to be done about the problems. Having abolished the National Ports Council he is now putting accountants into the companies that have been set up. The accountants are costing a lot more than the National Ports Council. It was paid by a levy on industry, whereas the taxpayers are paying for all the accountants. I do not know who comes best out of deal.

These are political points that it is natural for us to want to make. The great tragedy is that the Minister does not seem to have learnt. The various accountants' reports on London and Liverpool make it clear that traffic flow, upon which their future depends, is determined not only by price but by a variety of other factors—the geographical location, the type of investment, and so on. One of the most important factors revolves around the concentration of container facilities. Investment in excessive container capacity at Felixstowe will undoubtedly lead to Dart Line leaving Southampton, CPR leaving London, and Manchester Liners going from Liverpool. That will happen because they are part of a consortium that is investing in Felixstowe. It will add to the financial difficulties of the ports.

The Minister will then be faced with deciding whether to close ports down. The ports will tell him that they cannot survive in conditions of declining trade and rising manpower surpluses, which impose such a liability on their earning capacity. Will he then say that the ports must go bankrupt? No Government have been prepared to say that yet.

When he first came to office the Secretary of State bravely closed down Preston docks. But that was an easy one to deal with. Liverpool and London are different altogether. The consequences of closure for the communities and commerce in those areas would be considerable. In addition, the vast investment by society in roads and railways would be lost. The roads strategy is based upon serving the ports. But the future of the ports lies in the hands of the shipowners, playing one port off against another at a time of excess capacity.

I presume that by bringing this Bill forward the Secretary of State is saying that he will not declare ports bankrupt. If so, he will have to find another criterion upon which to base his policy. The Financial Times of 24 March said of the Bill— the question needs to be considered as to whether totally free competition between ports is in the country's best interests, or whether there should be some sort of national framework within which ports are allowed to develop. Ports are an integral part of the United Kingdom transport system and behave in many respects like public utilities. Even though inter-port competition is desirable they cannot be viewed as purely commercial concerns … A coherent ports policy, taking these factors into account, is overdue. The Secretary of State's contribution tonight reflected his failure to understand the difficulties of the ports industry, and it did not take us far towards a national ports policy.

Last year we predicted that Liverpool would need help. We argued strongly for it. I now give the right hon. Gentleman another prediction. Within 12 months something will have to be done about the port of Bristol, whether that is the responsibility of the Department of Transport, the Department of the Environment or the Department of Employment. Manchester, too, it is clear, is not far from needing the same treatment.

The Government cannot turn their backs on these problems. These ports are public utilities, and their failure would have consequences for the community that we simply cannot ignore. The Secretary of State would do well to consider how much less expensive it would have been to help Liverpool with £6 million in loans over the few years leading up to 1972. That was not done, and now the House is debating a Bill that involves grants and loans totalling about £250 million. What an approach to ports policy. It is the most expensive and the least efficient course to follow.

Against this background, and against demands for a ports policy and some central agency to oversee it, the right hon. Gentleman is abolishing the National Ports Council. Instead, he turns to the accountants for advice. We appeal to him to rethink his approach to the ports, to reassess the possibility of making this enhanced scheme of redundancy available across the country. That would not cost a great deal more. We can argue about that in Committee, and suggest what the cost would be.

The Secretary of State will have to consider limiting the further development of ports capacity. It is crazy for the community to spend more on developing port facilities when there is an excess of capacity already. The Government's piecemeal approach will create more problems. If cheap loans had been available to Liverpool in 1972 it would have been better off. Now, as a result of what happened then, the company cannot even sell its land, because it belongs to the shareholders. So, yet again, because of that Tory deal the taxpayers will have to foot the Bill.

Liverpool may reach break-even point if it gets the 1,200 registered dockers. However, even in private stevedoring there are problems for the major employer. Vestey's is blackmailing the port of Liverpool by demanding an interest in the container sector. The company that refused to pay tax is threatening to shift the burden of its unemployment on to the port of Liverpool unless agreement is reached. London has a similar problem, as has been shown with Price Waterhouse and the capital reconstruction. I could give further details if the time was available.

The competitive philosophy will eventually cost more money, and it does nothing to alleviate the problem. It also weakens the financial position of competitive ports. It puts a further burden on ports through extra levies for the National Dock Labour Board scheme. Moreover, there are surpluses not only in London and Liverpool but in Hull and Bristol, and so on.

The National Dock Labour Board scheme has been agreed by both Governments, and redundancy schemes have been implemented. Between 1965 and 1980, manpower was run down by 60 per cent. The scheme has played a considerable part in the readjustment of the industry, although there have been tremendous problems. When the Government introduced extra money in 1972, it was for every port. This is the first time that the House has been asked to differentiate between ports in redundancy proposals. The NDLB will require more money than the Bill allows for. How will the money be raised? It will be by levies or loans, but loan levies greater than 10 per cent. cannot be supported at present. Is the Minister prepared to allow a moratorium on interest payments?

The Bill deals only with a limited problem. It does not deal with port strategy. The problems were ignored in 1972. If we ignore them again in 1981 we shall have greater problems and even perhaps a national strike, because of the Bill. The Bill puts forward a bankrupt policy for bankrupt ports, for which we will continue to pay in the future.

10.36 pm

The Under-Secretary of State for Transport (Mr. Kenneth Clarke)

The contributions of the hon. Member for Kingston upon Hull, East (Mr. Prescott) are always forceful and are usually clear. He came as near as anyone to clarifying the attractive but vague call for a national strategy for ports, which is used by some of his right hon. and hon. Friends as a slogan. It sounds appealing, but it is merely a substitute for a policy of tackling the real problems. We got an inkling of precisely what he means by a national plan for ports. We have listened to his speeches upstairs about a national dock authority. I have some idea of where at least he wants to go.

However, I remain convinced that the policy that the hon. Gentleman is advocating could be carried out only at huge costs to the taxpayer. It would be likely to reduce the service to exporters and importers. It would lessen competition between ports and frustrate investment in small and medium-sized ports. The hon. Gentleman makes no secret of his hostility to investment in those ports which have been a success over the past 10 years. Had he had his way, the port of Felixstowe would scarcely have existed, let alone expanded to its present size. I also fear that his policy would tend to give rise to unreal hopes in the ports industry and among sections of the work force that they would be relieved from the pressures that changes in cargo handling and traffic are bound to bring to our traditional ports industry. I see what the hon. Gentleman means about a national strategy. No doubt it is also what the right hon. Member for Barrow-in-Furness (Mr. Booth) means, but it is not a realistic solution.

Our policy remains the same as it was when we came to the House with the Port of London (Financial Assistance) Bill last year. The industry should serve the trading community by ports competing with each other in services, commercial pricing policy, and so on. Each port can cope with the difficulties by reducing and rationalising facilities, by rationalising manpower to fit the traffic which there is a realistic hope of gaining, by providing quality of service and by raising productivity to a level that can give secure jobs to the manpower in each port. To the extent that each port succeeds, its customers will benefit and the trading performance of this country will benefit.

Some ports face very big transitional problems in adapting that policy, based on competition and choice for the trader, in view of the history of change that had taken place in their dock areas. The Port of London Authority and the Mersey Docks and Harbour Company are our two biggest traditional ports authorities. The House should therefore not have the difficulty that the Opposition seem to have in distinguishing between the situation facing the Port of London Authority and the Mersey Docks and Harbour Company and that of the huge list of ports, docks and quays contained in their reasoned amendment, which they say should have part of the same largesse because that is what they call a national ports policy.

I do not believe that some Opposition Members, including some who have an interest in the ports, have entirely taken on board the depth of the crisis to which the Port of London Authority and the Mersey Docks and Harbour Company have been reduced, principally by changes of trade, during the past year. There is no point in going too far back into history. We all know that the dramatic change in cargo-handling methods has hit the traditional ports particularly hard. The growth of container and roll-on/roll-off traffic has left installations such as the Royal docks in London and the deep water installations on the Mersey having to cope with very great changes. There are also difficulties because London is some way up an estuary in terms of the old closed docks, and Liverpool is on the West Coast whereas the growth of trade has been with European ports on the other side of the country, and so on.

I concede, however, to those with interests in the two ports, that both have made dramatic attempts to adjust to the changed conditions over the past 10 years. Those efforts continued even after last year's legislation when the Government were adopting a policy towards London similar to that being adopted now. In 1980, for instance, the Port of London Authority, helped by the legislation, succeeded in shedding more than 1,900 men—more than 800 registered dock workers and more than 1,000 staff. The Mersey Docks and Harbour Company last year shed 570 men-360 registered dock workers and 210 staff. But the loss of traffic that those ports suffered last year as a result of the level of trade and industrial activity in this country, as well as the disadvantages in which their own working practices still placed them compared with the more succesful and competitive ports, meant that over the last year their position deteriorated very seriously.

Let us consider the situation which has led the Government to seek a Second Reading of the Bill as a matter of urgency. The Port of London Authority lost £11.1 million in 1979, and it is estimated to have lost £15 million in 1980. It has about 3,700 registered dock workers and 2,800 staff. But there is no work from day to day for about 1,500 of those men. The Mersey Docks and Harbour Company lost £7.4 million in 1979 and probably lost £6.5 million in 1980. It has about 3,000 registered dock workers and 2,800 staff. Again, there is no work—and no likelihood of work—for 1,000 of its registered dock workers and 500 staff.

Both ports therefore have about one-quarter of their manpower surplus to requirements and no work to offer those men. That is a continuing financial drain, which has led to enormous annual losses. These ports no longer even have the money to finance the severances that are a necessary to persuade that one-quarter of the work force to leave, which is putting them in a ruinous position at present. That is the situation. Those ports are bankrupt. If the House carries the Opposition's reasoned amendment, with which I shall deal in a moment, and denies a Second Reading to the Bill, those ports will cease trading within a matter of days.

I appreciate that this causes concern to hon. Members such as my hon. Friend the Member for Northampton, North (Mr. Marlow). I have considerable sympathy with the points that he made. Other British industries are in a critical condition. Industries such as textiles and footwear are facing desperate situations with surplus manpower and trying to sever their staff. We appreciate that. But I think that my hon. Friend accepts that the Port of London Authority and the Mersey Docks and Harbour Company, much though many hon. Members would like to think of them as analogous with companies in their own constituencies, are not analogous with ordinary private sector companies. They are great port authorities which carry out conservancy and other statutory duties in the estuaries. Both authorities, particularly the PLA, service other private sector industries.

Receivership is a difficult course to follow in respect of these great public bodies in which the Government already appoint the board or have a substantial hand. They are vital installations for a large number of other private industries both in London and Liverpool. Given that they are facing a crisis, and given that in the near future we shall not move away from the registered dock workers scheme or the basis of the severance pay, it calls for emergency help of this kind.

The form of help is a one-off crash programme, with severance as its central feature, to help those who apply for severance only in March and April this year, The Bill will enable the Government to supplement the severance pay of registered dock workers by an additional £5,500 over and above the national voluntary severance scheme level of £10,500.

This is not a permanent move to two classes of severance. It is an emergency offer for two months only to two ports which will close unless something is done to help them through the present crisis.

It is not a long-term guarantee. Here I must correct my hon. Friend the Member for Wirral (Mr. Hunt), who seemed to think that this was guaranteed stability. If that severence is successful, and if, thereafter, plans can be produced which give the ports the opportunity to return to a profitable and competitive position, the Bill will enable my right hon. Friend to take further steps and to support them in some trading losses and essential investment while they continue to sever.

Two other points were raised about what the PLA ought to be doing. My hon. Friend the Member for Southend, East (Mr. Taylor) asked about the Port of London police. I have great sympathy with what he said about their reduced pay—compared with other police forces—as well as their career prospects. My right hon. Friend is not stepping in to the day-to-day management of the PLA. The authority will remain responsible for the police force. Obviously, I shall make sure that my hon. Friend's remarks are drawn to the attention of the PLA. No doubt it will supply him with its up-to-date reaction to the problems of the police and how it proposes to deal with them.

I understand that there have been some discussions about the possibility of an amalgamation of the Port of London police and the British Transport police. Unfortunately, practical objections have so far prevented that amalgamation from taking place. However, it will remain the responsibility of the PLA to deal with the future of the Port of London police.

Mercantile Lighterage was mentioned. I understand that there is a prospect of that company ceasing to trade. My right hon. Friend has been sounded out about the Government's position. I can assure my hon. Friend the Member for Faversham (Mr. Moate), and confirm to the hon. Member for Newham, South (Mr. Spearing), that my right hon. Friend and the Government do not approve of the prospect of the PLA taking over a loss-making lighterage business, given its present situation.

We are particularly concerned about the knock-on effect that the PLA's taking over a loss-making lighterage company will have on the other lighterage firms up and down the river, which will inevitably suffer from loss of trade and prospects as a result. It will merely jeopardise other businesses if the PLA steps in and tries to rescue that company.

We are therefore suggesting an emergency measure for two ports where the scale of activity and crisis is far greater than in other ports. We are suggesting that the Government should put some money behind them to help them transform to perhaps much reduced but competitive and successful ports, which can thrive in the competitive atmosphere that is essential for the ports industry.

Mr. Spearing

Does not the hon. and learned Gentleman realise that the refusal of permission could—unless he makes conditions—sever lighterage traffic on rivers and canals which feed and maintain traffic in the port of London? Surely, the hon. Gentleman wishes to assist the port of London. Has he not got some responsibility?

Mr. Clarke

There are other healthy lighterage companies on the river. If one goes out of business, the others will probable take over the traffic. The Port of London Authority has no experience of lighterage and has never been involved in it. It it were to take over a loss-making company, harm could result. In part reply to my hon. Friend the Member for Northampton, North, I should point out that should there be a closure those who work for private sector companies that get into difficulties in the immediate period will also be able to take advantage of the enhanced voluntary severance arrangements provided by the Bill. If a crisis must be faced, the Bill may come at a fortunate time, because registered dock workers will be able to take advantage of the Bill.

Mr. Teddy Taylor

rose—

Mr. Clarke

Having given way to the hon. Member for Newham, South, I am sorry that I cannot give way to my hon. Friend. However, there are many points that remain unanswered.

I have sketched what we are doing for London and Liverpool. We are entitled to ask the Opposition what their alternative is in the long term. I have described what their long-term alternative and national plan would lead to. I do not know what alternative they think they are giving the House. Despite the strictures of the hon. Member for Liverpool, West Derby (Mr. Ogden), the Opposition are determined to refuse the Bill a Second Reading. [Interruption.] Opposition Members are clutching copies of "Erskine May." We have all read it. We can all see the terms of the Opposition's amendment. It means exactly what it says: this House declines to give a Second Reading to a Bill". The Opposition's policy seems to be that they decline to give the Bill a Second Reading tonight, but they might give it one next week.

Mr. Booth

rose—

Mr. Clarke

I may give way in a moment, but I wish to ensure that the right hon. Gentleman knows where he is. When I mentioned this point to the hon. Member for Kingston upon Hull, Central (Mr. McNamara) he cheerily assumed that we could ignore everything and that my right hon. Friend could carry on paying out the money. My right hon. Friend and I cannot raise the few million pounds that the docks will need in the next few days out of our own resources.

Despite the weaknesses of our parliamentary procedure we need the authority of a Second Reading before we can commit public expenditure on this scale, or anything like it. If the Bill is declined a Second Reading, both ports are likely to cease trading next Wednesday. The Opposition are being frivolous when they suggest that they might give the Bill a Second Reading later. Presumably it will be the same Bill. Perhaps they want to take it away and redraft it.

I shall not dwell further on the Opposition's position, because the first five minutes of the speech made by the hon. Member for Kingston upon Hull, East were taken up by an animated debate between the hon. Gentleman and another hon. Member. The Opposition have internal problems as regards deciding what to do. I do not understand it and neither do my hon. Friends.

Mr. Booth

The hon. and learned Gentleman has just demonstrated, as he said, that he does not understand. Chapter 21, page 500 of "Erskine May" deals with the effect of carrying a reasoned amendment. If he were to study that page he would notice that it is for the Government to decide whether to amend a Bill if a reasoned amendment is carried. "Erskine May" makes it clear that the effect of a reasoned amendment being carried is that the Second Reading is delayed. The Government could present the same Bill tomorrow, when—as they know—we shall not oppose its Second Reading.

Mr. Clarke

The streets of the Isle of Dogs and of Liverpool will be crowded with people reading "Erskine May." They will be reassured by the thought that a precedent was set in 1861 that suggests that it might be possible for the Government to go away, to redraft another Bill in three days, and to try to gain a Second Reading. I believe that not for the first time the Opposition transport team have got their tactics a little confused.

We wish the Bill to obtain its Second Reading tonight. There will still be safeguards. A considerable sum of money is involved—£87 million potentially of new money. But it is not going to be issued just like that and there is no guarantee that it will ever be expended to the full. Initially my right hon. Friend will set ceilings which will carry these undertakings over the next two to three months. At the end of that time we will look at the success of the severance programme to decide what steps to take then. No doubt further funds would be released to enable them to continue to the autumn if the severance scheme had been reasonably successful. In the autumn, with the assessments of accountants, the two companies will come forward with their long-term strategies. Then we will have to decide to what extent the two ports have a future, how that is to be achieved, and whether further assistance under the Bill is justified by their performance and progress. That is the way in which we wish to deal with these two companies.

A great deal of the debate has been taken up by other hon. Members who are not opposed to the assistance that the Government are giving to the port of London and the port of Liverpool but are fearful about the effects on other ports. I have left myself time only to draw the distinction between the scale of problems that I have just described in London and in Merseyside and that in some of the other ports that have been referred to. I understand constituency speeches—hon. Members saying "Why can my port not have some money as well?" With respect to some hon. Members, their ports are in a totally different position.

The hon. Member for Greenock and Port Glasgow (Dr. Mahon) mentioned the Clyde. Of course, it has some problems of surplus manpower, but it has over £11 million worth of reserves. It is trying to sever only 60 people and it made £3 million profit in 1979. Clyde is not in the same critical situation. Neither is Manchester, which has £13.4 million worth of reserve. Even Bristol, which I will come on to in a moment because it is a little more complex, although it is making losses, has reserves of £2½ million.

My right hon. Friend actually met the manager for Bristol, who explained that it is seeking to sever 50 registered dock workers; presumably it would like to have assistance with that. Liverpool and London are trying to sever one-quarter of their work force—3,000 people. It is ridiculous to suggest that somehow we are compromising ourselves by not offering the same assistance to the smaller ports. I do not want to dismiss the problems of these other ports, least of all Bristol. It has serious problems, which are falling on the local authority, but again I must underline, as my hon. Friend the Member for Bristol, West (Mr. Waldegrave) underlined, that in the end the responsibility lies with Bristol city council. When the then Minister for Transport gave permission for it to invest in Portbury, which is where the problems arise, he made it clear in his letter that responsibility, financial and otherwise, for the project lay solely with the Port of Bristol Authority. The authorisation letter did not commit the Government of the time in any way.

I have no doubt that the city of Bristol is doing the same studies of the long-term future that had to be done in London and Liverpool to see how it can rationalise the port, how far the work force can be reduced, and what may remain open, to try to get it back on a sound footing. There is no way in which the Government will put pressure on the British Transport Docks Board or anybody else to step in in Bristol in such a way as to jeopardise the future of the South Wales ports, of which the right hon. Member for Swansea, West (Mr. Williams) was fearful. The British Transport Docks Board is meeting the city of Bristol. Let me make it clear that the Docks Board is free to make its own commercial decision about its involvement, if any, in the port of Bristol. There will be no Government pressure to make it step in in that port.

There is no way in which the assistance under this Bill can be extended to Bristol or other ports. Distinctions can be drawn. We shall be ignoring the crisis of the moment and what can be achieved in London and Liverpool if we fritter the time this evening by voting on a rather strange reasoned amendment, which tries to draw in the quite different problems of a whole range of ports all round the coasts of this country.

Question put, That the amendment be made:

The House divided:Ayes 81, Noes 137.

Division No. 124]	[11.00 pm
AYES
Anderson, Donald	Jay, Rt Hon Douglas
Atkinson, N. (H'gey,)	Johnson, James (Hull West)
Bennett, Andrew(St'kp'tN)	Jones, Dan (Burnley)
Booth, Rt Hon Albert	Lamond, James
Boothroyd, Miss Betty	Leighton, Ronald
Brown, Hugh D. (Provan)	Lestor, Miss Joan
Campbell-Savours, Dale	Lewis, Ron (Carlisle)
Clark, Dr David (S Shields)	Lofthouse, Geoffrey
Cocks, Rt Hon M. (B'stol S)	Mabon, Rt Hon Dr J. Dickson
Concannon, Rt Hon J. D.	McCartney, Hugh
Cowans, Harry	McDonald, Dr Oonagh
Cryer, Bob	McKay, Allen (Penistone)
Dalyell, Tam	McNamara, Kevin
Dixon, Donald	Marshall, D(G'gowS'ton)
Dormand, Jack	Marshall, Dr Edmund (Goole)
Douglas-Mann, Bruce	Millan, Rt Hon Bruce
Dubs, Alfred	Mitchell, R. C. (Soton Itchen)
Duffy, A. E. P.	Newens, Stanley
Dunwoody, Hon Mrs G.	Oakes, Rt Hon Gordon
Eadie, Alex	Palmer, Arthur
Eastham, Ken	Parker, John
Ellis, B. (NE D'bysh're)	Powell, Raymond (Ogmore)
Fletcher, Ted (Darlington)	Prescott, John
Forrester, John	Roberts, Ernest (Hackney N)
Foster, Derek	Rooker, J.W.
Graham, Ted	Ross, Ernest (Dundee West)
Grant, George(Morpeth)	Rowlands, Ted
Grant, John (IslingtonC)	Sever, John
Hamilton, James(Bothwell)	Shore, Rt Hon Peter
Hamilton, W. W. (C'tral Fife)	Silverman, Julius
Harrison, Rt Hon Walter	Skinner, Dennis
Haynes, Frank	Snape, Peter
Hogg, N. (EDunb't'nshire)	Soley, Clive
HomeRobertson, John	Spearing, Nigel
Homewood, William	Stott, Roger
Hooley, Frank	Tinn, James
Hughes, Mark(Durham)	Wainwright, E. (Dearne V)
Hughes, Robert (AberdeenN)	Welsh, Michael
Hughes, Roy (Newport)	Whitehead, Phillip

Wilson, Gordon (DundeeE)	Tellers for the Ayes:
Winnick, David	Mr. Joseph Dean and Mr. George Morton.
Woolmer, Kenneth
NOES
Alexander, Richard	Dykes, Hugh
Alton, David	Fenner, Mrs Peggy
Arnold, Tom	Fisher, Sir Nigel
Aspinwall, Jack	Fletcher-Cooke, Sir Charles
Atkinson, David(B'm'th,E')	Fowler, Rt Hon Norman
Baker, Nicholas (N Dorset)	Gardiner, George(Reigate)
Beith, A.J.	Garel-Jones, Tristan
Benyon, Thomas(A'don)	Gow, Ian
Berry, Hon Anthony	Gray, Hamish
Best, Keith	Griffiths, E. (B'ySt. Edm'ds)
Bevan, David Gilroy	Griffiths, Peter Portsm'th N)
Biggs-Davison, John	Gummer, John Selwyn
Blackburn, John	Hawksley, Warren
Boothroyd, Miss Betty	Hicks, Robert
Bright, Graham	Hogg, Hon Douglas (Gr'th'm,)
Brinton, Tim	Hunt, David (Wirral)
Brittan, Leon	Hunt, John(Ravensbourne)
Brooke, Hon Peter	Hurd, Hon Douglas
Brotherton, Michael	Jopling, Rt Hon Michael
Brown, Michael (Brigg & Sc'n)	Kilfedder, James A.
Buck, Antony	Lang, Ian
Carlisle, John (LutonWest)	LeMarchant, Spencer
Carlisle, Kenneth (Lincoln)	Lester, Jim (Beeston)
Carlisle, Rt Hon M. (R'c'n)	Lloyd, Peter (Fareham)
Chalker, Mrs. Lynda	Luce, Richard
Chapman, Sydney	Macfarlane, Neil
Churchill, W.S.	MacKay, John (Argyll)
Clark, Hon A. (Plym'th, S'n)	McNair-Wilson, M. (N'bury)
Clarke, Kenneth (Rushcliffe)	Madel, David
Colvin, Michael	Marlow, Tony
Cope, John	Marshall, Michael(Arundel)
Crawshaw, Richard	Marten, Neil (Banbury)
Crouch, David	Mawhinney, DrBrian
Dorrell, Stephen	Maxwell-Hyslop, Robin
Douglas-Hamilton, Lord J.	Meyer, Sir Anthony
Dover, Denshore	Miller, Hal(B'grove)
Dunn, Robert(Dartford)	Mills, Iain(Meriden)

Miscampbell, Norman	Speller, Tony
Moate, Roger	Spicer, Michael (S Worcs)
Morris, M. (N'hampton S)	Sproat, Iain
Murphy, Christopher	Stanbrook, Ivor
Myles, David	Steel, Rt Hon David
Neale, Gerrard	Steen, Anthony
Needham, Richard	Stevens, Martin
Neubert, Michael	Stewart, A. (E Renfrewshire)
Newton, Tony	Stradling Thomas, J.
Ogden, Eric	Taylor, Teddy (S'end E)
Page, John (Harrow, West)	Tebbit, Norman
Page, Rt Hon Sir G. (Crosby)	Temple-Morris, Peter
Page, Richard (SW Herts)	Thomas, Rt Hon Peter
Patten, Christopher(Bath)	Thompson, Donald
Pattie, Geoffrey	Thorne, Neil(IlfordSouth)
Penhaligon, David	Townend, John(Bridlington)
Pollock, Alexander	Townsend, Cyril D, (B 'heath)
Proctor, K. Harvey	Trotter, Neville
Renton, Tim	Waddington, David
Rhodes James, Robert	Wakeham, John
Ridley, Hon Nicholas	Waldegrave, Hon William
Roberts, M. (Cardiff NW)	Waller, Gary
Roberts,, Wyn (Conway)	Ward, John
Ross, Stephen (Isle of Wight)	Watson, John
Sainsbury, Hon Timothy	Wells, Bowen
Sandelson, Neville	Wheeler, John
Scott, Nicholas	Wickenden, Keith
Shaw, Giles (Pudsey)	Williams, D. (Montgomery)
Shelton, William(Streatham)	Winterton, Nicholas
Shepherd, Colin(Hereford)
Silvester, Fred	Tellers for the Noes:
Skeet, T. H. H.	Mr, Alastair Goodlad and Mr. Robert Boscawen.
Smith, Dudley
Speed, Keith

Question accordingly negatived.

Main Question put forthwith, pursuant to Standing Order No. 39 (Amendment on Second or Third Reading) and agreed to.

Bill accordingly read a Second Time.

Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).