Commons Sitting of 25 January 1982

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

    Computers in Schools
    Mr. Trotterasked the Secretary of State for Industry what progress has been made in the introduction of computers into schools.
    The Minister for Industry and Information Technology (Mr. Kenneth Baker)Progress in my Department's micros in schools scheme is excellent. A total of 2, 300 applications had been processed by the end of 1981 and, with the extension of the scheme to all secondary schools from January this year, large numbers of applications are expected. I am very satisfied with the success of this scheme so far, and we are well on the way to reaching our objective of ensuring that every secondary school has at least one micro by the end of 1982.
    Mr. TrotterI congratulate my hon. Friend on the success of this imaginative scheme. Has sufficient progress been made in the training of teachers in these schools to get the full benefit out of the machinery that is being installed?
    Mr. BakerMy hon. Friend will appreciate that my role is to provide cash for the hardware—the equipment. The role of the Department of Education and Science is to provide the training, and it operates such a scheme. It has allocated £9 million for the training of teachers, because it would be useless to supply schools with microcomputers unless some of the staff were trained to use them. I hope that that training scheme will go from strength to strength.
    Mr. Tom EllisThe Minister will be aware that a few months ago I raised the case of a manufacturer in my constituency who can compete in terms of price, quality and every other respect. Has the hon. Gentleman extended the original list of two names so that other manufacturers can participate in this scheme?
    Mr. BakerAs I said, the scheme is being extended to all secondary schools from January this year, and the two manufacturers who have been selected will cover that extension. I am considering the possibility of extending the scheme to primary schools. In that event, we shall look at other manufacturers as well as the first two.
    Mr. NealeI congratulate my hon. Friend on the enthusiasm with which he has pursued this programme.
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    Has he initiated any studies on the future use of computerised learning methods through the telephone network by primary schools, particularly those that are threatened in rural areas? If not, will he consider doing so?
    Mr. BakerThat is an interesting idea and I shall certainly pursue it. The support that the Department is providing is available for private as well as State schools.
    Mr. John GarrettDoes the Minister agree that the work done by his Department is being undermined by the Department of Education and Science, especially by cutting the facilities available for training teachers in computing? Most institutes of education no longer have lecturers in computer studies. In addition, the DES is either unable or refuses to provide sufficient software for the scheme. As a result, the scheme is in jeopardy because, although the Minister is providing the hardware, the teaching facilities are not available.
    Mr. BakerThe hon. Gentleman exaggerates. The Department of Education and Science has allocated £9 million for the training of teachers and the provision of software. That is an essential part of the scheme. I shall draw the hon. Gentlman's remarks to the attention of my right hon. and hon. Friends, because the continuation of the training programme is important.
    Mr. NelsonI join in the welcome that has been given to the scheme. Is my hon. Friend aware that there is concern whether local education authorities are pulling their full weight? It is not just a question of money. Is he satisfied that they are doing as much as they can to ensure that the systems installed in schools are integrated and that there is sufficient provision of software, which need not be terribly expensive?
    Mr. BakerThe practice varies from one education authority to another. Some of those that I have visited do an impressive job co-ordinating the activities of all their schools and providing basic software and common programmes. I certainly encourage all local authorities to move down that road.

    Loan Guarantee Scheme
    Mr. Gryllsasked the Secretary of State for Industry if he will raise the upper limit on the loan guarantee scheme from £75, 000 to £500, 000.
    Mr. Nelsonasked the Secretary of State for Industry when he intends to make his first review of the loan guarantee scheme for industry.
    The Under-Secretary of State for Industry (Mr. John MacGregor)The loan guarantee scheme has now been in operation for just under eight months, and I shall be reviewing its operation to date with the banks very shortly. We must look carefully at how it is working before considering major changes of the sort suggested by my hon. Friend.
    Mr. GryllsA review would be useful, but does my hon. Friend agree that whereas research in the United States has shown that new small firms create the greatest number of new jobs, in Britain the existing small firms have the greatest potential for creating new jobs? Is it not therefore necessary to raise the upper limit from the modest £75, 000 to £500, 000, and would we not create more jobs if we did so?
    Mr. MacGregorWe are anxious to increase the contributions of both new and existing small firms, but an increase to £500, 000 would change the nature of the scheme and greatly increase the potential cost. It is one of those points that I shall be taking into account in the review, but, as my hon. Friend knows, the scheme is going like hot cakes in its present form. Up to the end of last month 1, 839 businesses had been helped with a total of £63·6 million, and the pace is accellerating. I have to take that point into account, too.
    Mr. NelsonMy hon. Friend deserves great credit for the way in which he and the Government have administered and expanded the scheme over the last 18 months. In view of the importance of expanding the number of new jobs, will he bear in mind the importance of ensuring that the proportion of new businesses as opposed to existing ones receiving support under the loan scheme is in the majority? Will he ensure that not just a larger amount of money in terms of limit is made available, but that the proportion of new businesses is in the majority?
    Mr. MacGregorI am grateful to my hon. Friend for his tribute. The experience so far has been most encouraging. It is difficult for us to be certain that it is directed entirely in the way that he suggests, because we are at the mercy of the response by businesses to the scheme.
    So far they have responded extremely well. I am sure that my hon. Friend will be delighted to know that still over half of the money is going into new businesses and that a good deal more than half of the total number of businesses being helped are new businesses, although that in itself means that a large amount is also going to existing businesses.
    Mr. PittIs it not about time that the interest charged on the guaranteed part of the loan was reviewed, in view of the criticism by a number of business organisations, including the National Federation of Self Employed and Small Businesses, the Council for Small Industries in Rural Areas and the Development Commission, that many small businesses cannot afford to take the loans because the interest rates are too high?
    Mr. MacGregorIt is important to keep stressing that because the banks charge lower interest rates on that proportion of the lending that gets the guarantee the actual interest rates charged are broadly at the same level as the banks would be charging for marginal lending propositions without a guarantee. There is an important factor here. In a scheme of this sort, which is encouraging additional lending, we would be criticised by existing businesses if that lending were to be made at rates of interest well below what they were paying.
    Mr. FosterWill the hon. Gentleman bear in mind, when he reviews the scheme, that a very small proportion of the money is finding its way to the North of England? Has not the bulk of the money so far spent been allocated to companies in the South and the South-East? If he and the Government are looking to this or any scheme to do with small businesses to make a very large contribution to solving the unemployment problem in the North, they must bear in mind that, while it may make a contribution, it will be very marginal.
    Mr. MacGregorAs I said, it depends upon businesses making applications for loans. The North also includes the North-Western area.
    Dr. John. CunninghamThe Northern region.
    Mr. MacGregorThe hon. Member for Bishop Auckland (Mr. Foster) referred to the South and the South-East, so it is worth pointing out that the North-Western area has had the highest proportion of lending under the scheme to date. That indicates that there is not a bias in favour of the South by any means. Naturally, I should like to see the North-East increasing its lending under the scheme as well.
    Dr. GlynI congratulate my hon. Friend on what he has done. Is he aware that a large number of small businesses, although well constructed, are finding things very difficult? Is he satisfied that the proportion between new businesses and existing businesses which have a good foundation is correct?
    Mr. MacGregorI am well aware of the difficulties that, because of the world-wide recession, many small businesses are facing. It is encouraging that the balance in the loan guarantee scheme is as it is at the moment. As I said, the situation depends upon the applications being made by new and existing businesses.
    Dr. John CunninghamAre not bankruptcies and closures among small businesses at record levels? What does the Minister have to say in answer to the recent small business survey, which showed that over 800, 000 jobs had been lost in small businesses since the Government started their monetarist recession?
    Mr. MacGregorI would say three things in reply to that. First, the survey was not a scientific survey. Therefore, one must look carefully at the estimate of 800, 000 jobs lost. I should have thought that it was a good deal less, based on the sample itself. Secondly, other surveys show that while many small businesses are folding up at present, just as many are starting up. It is important to stress that aspect. Thirdly, there is widespread evidence that there has been a lower loss of jobs among small firms than among large ones.

    Public Subsidies
    Mr. Chapmanasked the Secretary of State for Industry what is his latest estimate of the total amount of public subsidy to be paid to industry this financial year; and how much of this is to be made available to the British Steel Corporation, BL and British Shipbuilders.
    The Secretary of State for Industry (Mr. Patrick Jenkin)Total support for British industry in the current year is estimated to be around £3 billion. This includes the whole of regional assistance to industry, support for small firms, science and technology and many other heads. A little over half of the total sum will go to finance the three industries mentioned in my hon. Friend's question. I regard this proportion as excessive, and it must be reduced as soon as practicable.
    Mr. ChapmanAs I understand that the British Steel Corporation, British Leyland and British Shipbuilders have shed substantial amounts of labour in recent years—about 25, 25 and 20 per cent. respectively—can my right hon. Friend give me an assurance that in future

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    the amount of public subsidy put into these three nationalised industries will be dramatically reduced and, indeed, that any subsidy that may be necessary will go into investment in sound capital projects, not into the preserving of uneconomic labour?
    Mr. JenkinI have a great deal of sympathy for the point made by my hon. Friend. Much of the money that has been spent has gone into sound capital projects. For example, in the case of BL, I have here a list of nine major capital projects financed over the last five years with a total investment—this comes from a variety of sources—getting on for £1, 000 million. In the steel industry there has been some valuable investment as part of the restructuring. I hope that over the next two to three years we shall see a substantial reduction in the burden that these firms represent to the taxpayer so that we can do a bit more in the new, modern industries where all major industrial countries give support.
    Mr. Roy HughesDoes the right hon. Gentleman agree that the steel, motor car and shipbuilding industries are vital if Britain is to have any future as an industrial nation? Furthermore, does he agree that all these industries have been run down? If this new capital is now to be realised and a return made upon it, should not the Government consider import controls to make sure of it?
    Mr. JenkinI do not think that it would be of any help in encouraging the increasing competitiveness of British industry if we were now to embark upon a wide-ranging programme of import controls as advocated by the official Opposition. As to the essentialness of industries, there is no point in maintaining in perpetuity industries in whatever product, that cannot in the end pay their way. The Government and the boards intend to make these industries viable so that they can contribute to rather than be a drain on the British economy.
    Mr. WardI welcome what my right hon. Friend said about making these industries viable, but will he continually remind both managers and workers in them that they are kept going by the grace of the taxpayer and the grace of the profits of those firms which are already viable, and that it is vital that they should realise that there is a limit to how long those in viable industries are prepared to go on subsidising them if they continue to work towards their own destruction, as some of them seem to be doing now?
    Mr. JenkinI am satisfied that the managements in these concerns are aware of that point. The question of how such information is made available to the work forces must be for the managements to decide.
    Mr. OrmeDoes the right hon. Gentleman agree that this investment in the public sector has a direct effect on the private sector and creates many thousands of jobs, as we saw recently in the motor car industry? Will he acknowledge that fact?
    Mr. JenkinI certainly acknowledge that fact. That is why I included support for those three major concerns in what I called total support for British industry. However, as much of the support, both in the past and now, goes to meeting losses, my hon. Friends are entitled to draw attention to that point and to say that they wish to see an end to it.

    Aerospace Industry
    Mr. Robert Atkinsasked the Secretary of State for Industry what Government assistance is at present available to the British aerospace industry.
    The Minister of State, Department of Industry (Mr. Norman Lamont)Government assistance may be provided in various forms. Net public expenditure in direct support for the civil aircraft, aero-engine and equipment industry in 1981–82 is expected to be £251·8 million.
    Mr. AtkinsIf it is still Government policy to put money into success stories, as it is in France, the United States of America, Japan and West Germany, when does my hon. Friend expect to be able to make a positive and helpful statement about Government support for the A320 airbus?
    Mr. LamontWe have received an approach from British Aerospace about the availability of launch aid, which we are considering. I agree with what my hon. Friend said about the successful record of the British aircraft industry. The Government wish to be satisfied that the project will earn a good return.
    Mr. McNallyWill the Minister look for close co-operation with the Japanese aerospace industry in considering a new launch into the 1980s and 1990s?
    Mr. LamontThe hon. Gentleman is right. The Japanese wish to expand their aircraft industry, and it is possible that collaboration with Japan can take place. However, that is a matter for the Government and a matter of first concern to the companies involved.
    Mr. Michael MarshallDoes my hon. Friend agree that, in addition to the figures that he has quoted, the assistance given to the European Space Agency should fairly be regarded as assistance to the British aerospace industry, especially as it moves increasingly into the area of electronics information technology?
    Mr. LamontMy hon. Friend is right. The figures that I quoted did not include £55 million spent on space, which goes largely to the ESA.

    British Leyland
    Mr. Hal Millerasked the Secretary of State for Industry whether he will place a version of the approved corporate plan of BL in the Library; and if he will make a statement.
    Mr. Patrick JenkinAs BL's corporate plan contains commercially confidential information, it is not publicly available. Copies of BL's report on the corporate plan are available in the Vote Office and in the Library.
    Mr. MillerI invite my right hon. Friend to congratulate the men and management on their efforts and achievement in introducing new models and modernising production facilities while remaining within their cash flow targets despite recession and rising prices. Will he ensure that Government action does not result in higher prices for raw materials, especially steel, and prejudice the outcome of the corporate plan?
    Mr. JenkinMy hon. Friend will know, because he follows such matters closely, that after several years of major loss making by almost all European steel producers, last year the Community embarked upon a plan to restore

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    viability to Europe's steel industry. That plan must inevitably involve an increase in prices. It is fair to say that there can be no future for British steel-using industries if they rely solely upon subsidised steel, as was the position until quite recently.
    Mr. OrmeIs the Secretary of State aware of the serious situation that has developed in the bus and truck devision at Bathgate and at Leyland in Lancashire, which could place that division in jeopardy? Will he intervene and take some action to find out the basis of the problem? Immediate steps should be taken, because thousands of workers are involved. Those of us who have tried to discuss the matter, with both management and workers, feel that some direct action should be taken by the Government.
    Mr. JenkinI disagree with the right hon. Gentleman. This is an unofficial strike by people protesting against the rationalisation of production in the Leyland group. The strike started at Leyland and has now spread to Bathgate. I agree that unless good sense returns quickly, question marks will again hang over that part of British Leyland. The great majority of the workers at the two plants are well aware of that fact.
    Mr. StokesI welcome the progress that British Leyland has already made, but does not the company have a great responsibility to all British taxpayers in view of the Government's largesse towards it? Is not the best contribution that British Leyland can make to improve its efficiency to the same extent as the private sector?
    Mr. JenkinYes, and the great majority of British Leyland workers are well aware of that. For example, the cars division, which is connected to a large extent with my hon. Friend's constituency, improved productivity, expressed in vehicles per man year, by no less than 33 per cent. last year. That is a most notable and welcome achievement. Improvement in the productivity and general performance of the company, which is the only way to satisfy customers, will ensure long-term jobs for those who remain with the company.
    Mr. OrmeI must press the Secretary of State on the position at Bathgate and at Chorley in Lancashire. The workers involved are highly responsible and they have co-operated in recent years in improving productivity and output. In the interests of the industry, will the Secretary of State intervene?
    Mr. JenkinThe day-to-day conduct of industrial relations must be a matter for the management of British Leyland. That was made abundantly clear by the right hon. Member for Cardiff, South-East (Mr. Callaghan) when Sir Michael Edwardes was first appointed and it has been made clear since then by every Minister who has had responsibility. Nothing would be more damaging to the authority of the British Leyland management than for me to try to take matters out of its hands.
    Information that has reached me suggests that many of the workers at both Bathgate and Leyland are fully aware of the reality of their position. They have been inundating—that was the word that was used to me—the offices of the company with requests for voluntary redundancy terms. They know that rationalisation is going ahead.

    Northern Region
    Mr. Dormandasked the Secretary of State for Industry if, further to his answer of 7 December, Official Report, column 575, he has now studied the Central Statistical Office figures showing that the Northern region now has the slowest industrial growth in the United Kingdom; and if he will make a statement.
    Mr. MacGregorYes. The CSO article examines trends in regional gross domestic product in the decade to 1980. During the first half of the decade the Northern region experienced the fastest rate of growth of GDP per head of all the regions. In the latter half the North slipped from the position of fastest growth to that of slowest.
    It is our policy to concentrate resources on the areas of greatest need. In keeping with that, over 80 per cent. of employees in the Northern region will continue to live in special development and development areas after the changes projected for later this year—a higher figure than in any other region.
    Mr. DormandThat answer is not clear. Is the Minister saying that the Government do not accept the statistics simply because they do not suit the Government's case? If the Minister does not accept that proposition, does he accept that the Northern CBI is heavily critical of at least some aspects of the Government's industrial policies? Is it not self-evident that, despite the parrot-like repetition that we hear from the Dispatch Box about what the Government are doing for the region, the North continues to have the highest unemployment rate and that the policies that have been enunciated yet again are a complete failure? Is it not time for a fundamental change in attitude towards the North?
    Mr. MacGregorI made it plain that I acceped the article. As it does not suit the hon. Gentleman's case as much as it suits mine, he should consider it with more care. The article points out that the decline in relative growth occurred before the Government took office. The more favourable growth rate in the North in the early 1970s had come to an end by 1976 and that had taken place under the previous Conservative Government. Having said that, I accept that there are massive problems in achieving industrial restructuring of the Northern region. Regional preferential expenditure in the Northern region since we came to power has exceeded £360 million, which is more than anywhere else.
    Mr. TrotterIs not the prosperity of the North-East and other areas that depend largely on the older industries tied to the prosperity of Britain as a whole? Therefore, should we not be grateful for the fact that all Governments have continued to give support to the North-East? Is it not damning to see from the statistics read out by my hon. Friend that national policies were favourable to the North-East in the first half of the 1970s and not in the period of the Labour Government?
    Mr. MacGregorMy hon. Friend is right. The more that we can pull round the country's economic decline, the more the regions generally will benefit. That is why we have also put so much emphasis on increasing productivity, getting rid of overmanning and dealing with inefficiency.

    British Leyland
    Mr. Dalyellasked the Secretary of State for Industry, pursuant to the reply of the Under-Secretary of State on 14 December, Official Report, c. 23, if he has any progress to report on the recovery of regional development grant made in respect of the Bathgate factory of British Leyland.
    The Under-Secretary of State for Industry (Mr. John Wakeham)The Department is maintaining contact with BL, and, following the closure of the tractor assembly plant, which I understand will occur at the end of March, the appropriate amount of grant due to the Department will be recovered.
    Mr. DalyellDoes the Department have an estimate of the appropriate figure, and, if not, why not?
    Mr. WakehamUntil the Department has been given the details of the contract it cannot calculate the figure, but it will allow the retention of grant made on any assets that have fully satisfied the conditions of the grant. The remainder of the grant will be recovered in whole or in part in accordance with the Department's policies, which are consistently applied to all grantees.

    British Steel Corporation
    Mr. Whitneyasked the Secretary of State for Industry what is his estimate of the current daily cost to public funds of the operations of the British Steel Corporation.
    Mr. Patrick JenkinDuring the current financial year the total external cash requirements of the BSC are estimated to average £2 million a day.
    Mr. WhitneyIs not the future of the steel industry in Western Europe likely to lie largely with specialist and high grade steels? Does my right hon. Friend agree that the sooner we can staunch the haemorrhaging of the national wealth as revealed in the figures that he was kind enough to give, the sooner we are likely to establish an economy able to create long-term and viable jobs for British workers?
    Mr. JenkinI am not sure whether I go the whole way with my hon. Friend. I agree that there is a great future for the parts of the steel industry that can add value to basic steel making and get high quality, high-cost products where they can secure viable markets. However, with the progress made by the BSC in improving the productivity of its plants and increasing their efficiency, and the help of the price increases to which I referred in answer to my hon. Friend the Member for Bromsgrove and Redditch (Mr. Miller), I believe that there will be a long-term future for the BSC as a profitable and viable steel firm. Of course, there is no reason why it should be a public sector company.
    Mr. Barry JonesIs Britain not now in danger of having a steel industry that may be too small when the recession ends and domestic demand requires much more steel? Are we not in danger of being flooded with steel imports when the recession ends?
    Mr. JenkinThe information that I gave to the Select Committee on Industry and Trade was that the BSC is confident that it can meet a 20 per cent. upturn in the market without new capacity. That is quite a wide margin.
    Mr. Kenneth CarlisleWould not the cost of the BSC to public funds be much less if its sales could expand? Therefore, is it not worrying that the United States is considering restricting imports from Europe? Will my right hon. Friend do everything possible with his colleagues in the Government and in Europe to make certain that that does not happen?
    Mr. JenkinMy hon. Friend raises an important and disturbing issue. Full details of the anti-dumping and countervailing duty cases are yet to be received and assessed. I attended a meeting of Community Industry Ministers in Brussels on 13 January. We agreed unanimously that it was the United States recession rather than the volume or price of European exports that lay at the root of the American steel producers' problems. We therefore agreed that the members of the Community would work together to mount a robust defence against such action.
    Mr. CrowtherWill the Secretary of State make it clear that no less than £209 million is being spent in the present financial year on closing production capacity and putting people out of work? Would it not be more sensible to spend public funds to revive the economy and keep people in jobs?
    Mr. JenkinThe hon. Gentleman knows a great deal about these matters and will know that, with the world recession and the downturn in demand for steel, which affects the whole of Europe, there must be rationalisation of production, and, regrettably, that means closures and the attendant costs in looking after the people concerned. It is part of Community policy that the rationalisation should be done fairly, and we get a certain amount of help from Community sources towards the cost.

    Diesel Engine Industry
    Dr. Mawhinneyasked the Secretary of State for Industry if he is satisfied with the prospects for the diesel engine industry; and if he will make a statement.
    Mr. WakehamThe industry has been suffering from the effects of the world recession, which has caused a general weakness in the market for diesels. I am, however, confident that, as demand recovers, the prospects for United Kingdom producers will be good, provided that they can be competitive.
    Dr. MawhinneyIs not the diesel engine industry strategically important to the country? Therefore, do not the Government have a responsibility to intervene to protect it if it becomes apparent that it is being unreasonably undermined?
    Mr. WakehamThe Government realise the importance of the diesel industry, but, with one exception, United Kingdom producers form part of large engineering groups or international vehicle manufacturers, so it is difficult to think of a single strategy for the industry. However, my Department has responded to the diesel industry's need by offering selective aid of £12 million over the past year to encourage research and development and capital investment.
    Mr. DalyellWithout a strategy, what future is there for factories such as Bathgate?
    Mr. WakehamBathgate's future is bound up with the future of BL, and BL has a clear view on the way in which it sees itself in the market in the future.
    Mr. ViggersAre there not strong energy conservation arguments for shifting the balance between petrol and diesel more in favour of diesel to encourage the use of diesel engines in motor cars?
    Mr. WakehamThe technical part of my hon. Friend's question is more for my right hon. Friend. I would want to encourage the diesel industry as far as the Government are able. As I said, in 1981 we gave about £12 million of selective financial assistance.
    Mr. Campbell-SavoursWhy do we not sponsor the development of a small high speed, lightweight diesel engine to compete with the Italians and Germans? Will the hon. Gentleman suggest to companies such as Perkins that they make the development, so that the Europeans do not dominate our markets with their products?
    Mr. WakehamMy Department is in close touch with Perkins, BL and the other United Kingdom manufacturers of diesel engines.

    Industrial Strategy
    Mr. Knoxasked the Secretary of State for Industry whether he is satisfied, from the most recent figures for labour productivity in manufacturing industry, that the Government's industrial strategy is on target.
    Mr. Patrick JenkinThe latest figures suggest that productivity in manufacturing industry was 9 to 10 per cent. higher in the third quarter of 1981 than at the end of 1980. Partly because of this remarkable achievement, unit labour cost rises in the United Kingdom were among the lowest of our competitors. British industry is beginning to get into better shape to beat the competition.
    Mr. KnoxDid not the output per head in manufacturing industry rise by less than 1 per cent. between the second quarter of 1979, when the Government came to office, and the third quarter of last year, which is the most recent period for which figures are available? Can that be a satisfactory situation over the longer period?
    Mr. JenkinI am not sure that I recognise my hon. Friend's figures. The figures that we have for manufacturing industry show that output per head rose by about 10 per cent. and output per hour rose by about 7½ per cent. over the year. Unit labour costs over the past 12 months in this country have risen more slowly than in all our main industrial competitor countries, which is good news. We have begun to recover some of the lost competitiveness of earlier years.
    Mr. WrigglesworthThe question suggests that the Government have an industrial strategy. Can the Secretary of State tell us what it is?
    Mr. JenkinI will send the hon. Gentleman copies of some of my recent speeches.
    Mr. AdleyIn the absence of any helpful or sensible contributions from the Opposition, will my right hon. Friend accept congratulations, not on behalf of the Government, but on behalf of the managements and work forces, on what appears to be good news, with the country going in the right direction for once?
    Mr. JenkinI am glad that my right hon. Friend gives credit where it primarily belongs, which is to the managements and those who work in industry, who have made what is, by any standards, a remarkable improvement in productivity at a time of considerable industrial difficulty.
    Mr. FosterWas it a target of the Government's industrial strategy for manufacturing industry to lose 800, 000 people in 18 months and lose 20 per cent. of its output in the greatest slump of the past 50 years? With so many firms having gone out of business, is it not clear that those that remain must be more efficient, and does that not inevitably increase average productivity?
    Mr. JenkinBut of course. The hon. Gentleman is right in the final part of his question. It is because we have had a great deal of concealed unemployment, and because of overmanning and inefficient and restrictive work practices, that many sectors of British industry were not competitive. Under the pressure of the recession, firms throughout the country and right across industry have had to become more efficient in order to survive. They have shown themselves able to do so, and it is about time.

    Bearing Industry
    Mr. Marlowasked the Secretary of State for Industry if he will make a statement on the prospects for the bearing industry with particular regard to its self-sufficiency.
    Mr. MacGregorI know that the bearing industry has been passing through a difficult period in the current world recession. The reorganisations that have taken place in the industry should make it better placed to match competition in the future.
    Mr. MarlowHow important is a strong and self-sufficient bearing industry to this country? If the Government find it to be important, what action will they take to ensure that unfair competition and other activities do not disrupt it in future?
    Mr. MacGregorIt is obviously important that we should have a strong industry. As I have said, I think that it is better placed than in the past to take advantage of the upturn when it comes. I imagine that when referring to unfair competition my hon. Friend has in mind the undertaking that the EEC Commission won from Japanese producers on price levels of exports to the Community last year. I know that my hon. Friend took a close interest in that undertaking, which followed a case brought by the European trade association that alleged the existence of dumping. We are still awaiting the relevant statistics to assess whether the agreement is being adhered to and what effects it is having on United Kingdom industry.

    Post Office
    Sir William van Straubenzeeasked the Secretary of State for Industry whether he expects the Post Office to meet its profit targets in 1981–82.
    Mr. Kenneth BakerYes, Sir.
    Sir William van StraubenzeeDo I correctly understand that the target profit figure for the Post Office is £49 million? Although one is grateful for the half-year figure of a £7 million profit, as opposed to a loss of £30

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    million—an enormous improvement, in which productivity has played a great part—is it not still a little optimistic to hope to achieve the £49 million profit?
    Mr. BakerThe target is approximately that. It depends on the turnover, since the target for the Post Office is 2 per cent. of turnover and we had anticipated a turnover of about £2, 400 million for this year. From the information that I have had from the chairman of the Post Office, it seems that he is on line to make that. As my hon. Friend pointed out, the remarkable improvement of the past six months has been caused by a considerable improvement in productivity in the Post Office.
    Mr. Beaumont-DarkI am glad that my hon. Friend is satisfied with the profit target. Is he equally satisfied that the Post Office target of next-day delivery is nowhere near being accomplished? If the Post Office achieved that, it might even start to make a profit and we could all make a profit, because our letters would arrive on time.
    Mr. BakerThe Post Office will make a profit. I can assure my hon. Friend that it is running profitably. The November figures show that 88·4 per cent. of first-class letters were delivered the following day, and that is very close to the target. I should like to emphasise the enormous improvement made in productivity. For example, over Christmas, with approximately the same number of cards and letters delivered as in the previous year, about 3½ per cent. fewer hours were needed to handle them. It is a great tribute to the chairman of the Post Office that he has succeeded in making those productivity gains. There has been a gain of about 15·3 per cent. in reducing overtime hours, compared with the same period last year.

    Tristar Aircraft
    Mr. Wardasked the Secretary of State for Industry what are the likely effects on Rolls-Royce Ltd. of the decision by Lockheed to cease production of the Tristar aircraft.
    Mr. Norman LamontThe Lockheed decision is obviously a disappointment to Rolls-Royce. The chairman has informed me that in the short-term the impact on planned work load will be relatively small because of the world-wide recession that has already resulted in a scaling down of orders. In the longer term the company will endeavour to offset the loss of Tristar sales, but there is bound to be an effect on employment and profitability, which is currently being assessed.
    Mr. WardI thank my hon. Friend for that reply. Will he encourage Rolls-Royce to continue to seek technical co-operation with other aircraft engine manufacturers overseas?
    Mr. LamontI shall certainly pass my hon. Friend's views to the chairman. I agree with his implication that the scale of the industry is such that collaboration is becoming increasingly inevitable.
    Mr. TrotterIs there any possibility that we shall see Rolls-Royce engines in the successful Airbus family? Is it not a great pity that this European venture is not powered with a European engine?
    Mr. LamontIt is for Rolls-Royce to assess the commercial viability of new opportunities. We have not received any application for launch aid for the RB 500 from Rolls-Royce.
    Mr. ParkWill the hon. Gentleman reconsider his reply to the hon. Member for Poole (Mr. Ward)? He may conclude that it was an extremely complacent answer, since hundreds of redundancies are to take place in Rolls-Royce factories throughout the country. The Minister's replies to me and to the work force have been singularly unhelpful up to now.
    Mr. LamontI am sorry that the hon. Gentleman finds my reply unsatisfactory. My hon. Friend the Member for Poole (Mr. Ward) asked me about the prospects for collaboration, and collaboration with the Japanese is, in the first instance, a matter for the management. Obviously the Government keep themselves closely informed and are in close contact with Rolls-Royce all the time, but I cannot say more at this stage.

    British Shipbuilders
    Mr. Brothertonasked the Secretary of State for Industry what progress has been made in improving the productivity of British Shipbuilders.
    Mr. WakehamBetween 1979–80 and 1980–81 productivity in merchant yards rose by 15 per cent. as measured by compensated gross registered tons per man-year. However, overall levels of productivity are still not satisfactory, and British Shipbuilders is determined to make further improvements.
    Mr. BrothertonDoes my hon. Friend agree that the progress made so far is most welcome? How does he foresee productivity in British Shipbuilders over the next two years and does he believe that BS will then be able to compete effectively in world markets?
    Mr. WakehamImprovements in productivity are mainly a question for the chairman and the board, but the chairman has made it clear to all who work in BS that substantially improved productivity is vital to the corporation's success. Each yard has a productivity improvement plan, monitored at board level against specific targets. A special productivity team has been set up to attack specific productivity problems and its remit has been extended recently. British Shipbuilders is also considering what can be done with the introduction of computer graphics and advanced production techniques. Almost all companies already have productivity incentive schemes in operation and their effectiveness is being reviewed. New schemes are being introduced for the few remaining companies.
    Dr. John CunninghamIs not the Minister being just a little churlish? Have not the unions and the management made major advances in productivity, getting rid of all sorts of demarcation disputes in the process? Will the hon. Gentleman acknowledge that BS often delivers ships ahead of schedule? I remind him that just before Christmas a foreign buyer sent a telex to British Shipbuilders congratulating it on the quality of the work, which exceeded his highest expectations and
    "compares most favourably with the other vessels in the fleet which, incidentally, were built in other countries."
    That came from the purchaser of the "El Challenger" to the men and management of Austin and Pickersgill Ltd. Surely that is the sort of thing that the Government should praise and encourage.
    Mr. WakehamI am happy to associate myself with those remarks. There has been an improvement in

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    productivity in which the trade unions have played a large part. However, there is still a long way to go and productivity must rise way above the levels that were reached before nationalisation, in the days of private enterprise, if the industry is to be successful.
    Mr. GryllsThe Labour Government entered into a rather scandalous deal for Polish ships. Does my hon. Friend expect losses to increase because of the situation in Poland and a reduction in charter income?
    Mr. WakehamI have no reason to think so.

  ATTORNEY-GENERAL

    Prosecution Policy
    Mr. Dalyellasked the Attorney-General what recent discussions he has had with the Director of Public Prosecutions on prosecution policy.
    The Attorney-General (Sir Michael Havers)In accordance with my usual custom I have had regular meetings with the Director of Public Prosecutions at which prosecution policy was discussed.
    Mr. DalyellIs the Lord Chancellor considering issuing guidelines to magistrates in areas, such as the Leyland organisation, where work forces are occupying factories in a wholly responsible manner because they are desperate about their jobs and about redundancies?
    The Attorney-GeneralI have no information on this subject. If the hon. Gentleman's supplementary question is intended to mean that where criminal offences have been committed the Lord Chancellor will be seeking to influence the execution of the magistrates' duties, the answer must be "No".
    Mr. NelsonDoes my right hon. and learned Friend agree that it is of the utmost importance that the Director of Public Prosecutions should enjoy full public confidence? Is there not a danger that, after recent cases, there may be doubt on the part of the DPP and his officials about when to prosecute? If that were to be the case, would it not be extremely regrettable? Will he give the House an assurance that the DPP will continue to base his policy on a careful analysis of the evidence and a balanced assessment of where the public interest lies?
    The Attorney-GeneralI am sure that the Director of Public Prosecutions always applies those principles. The criticism that is usually levelled at him is that he does not prosecute in enough cases.
    Mr. EnglishWhen the right hon. and learned Gentleman is considering the report of the recent Royal Commission on criminal prosecutions, may I take it that he will take note of recent events in Scotland which illustrate that, private prosecutions never having taken place in the past 70 years, judicial restrictions on private prosecutions may well infringe upon this basic individual right? I hope that he will therefore reject at least one recommendation of the Royal Commission. Will he also consider that it might be a good idea if we reverted to the ancient British system, which is still the American system, and allowed prosecution ultimately to be decided upon by a jury?
    The Attorney-GeneralThere is no judicial discretion in private prosecutions. Certain statutory restrictions are
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    usually imposed by the will of the House. [Interruption.] There are a number of Royal Commission recomendations and they are under constant consideration.
    Mr. StokesIn any discussions that my right hon. and learned Friend has with the Director of Public Prosecutions, will he bear in mind that protection of the public from violent crime must be one of the foremost considerations in his mind if the Government are to continue to have the confidence of ordinary law-abiding citizens?
    The Attorney-GeneralI have always taken the view that violence is one of the worst crimes in the calendar. When I sat in a judicial capacity I always made certain, so far as I could, that the sentence reflected my views about that crime.
    Mr. Arthur DavidsonHas the right hon. and learned Gentleman discussed with the Director of Public Prosecutions recently any plans for setting up a national prosecuting service? If he has, what response has he received?
    The Attorney-GeneralIf the hon. and learned Gentleman had read the evidence submitted to the Royal Commission he would have seen my views and those of the Director of Public Prosecutions. We agree that there should not be a national prosecuting system but we were agreed—this emerged in the recommendations—that every police force should have access to local prosecuting systems, which presently does not happen throughout the country. It was suggested also that either the Home Secretary or the Attorney-General should have a say, or perhaps a veto, in the appointment of the senior prosecuting solicitor for each area.

    Complaints Against the Police
    Mr. Meacherasked the Attorney-General in what percentage of complaints made against the police in the last full year, alleging assault, the Director of Public Prosecution has initiated prosecution of the policeman concerned.
    The Attorney-GeneralIn 1979, which is the last full year for which results are available, the percentage of cases for assault prosecuted was 2·06 per cent.
    Mr. MeacherIt is scarcely surprising to learn that the Director of Public Prosecutions prosecutes in only about 2 per cent. of the police assault cases referred to him when cases occur such as the one revealed in yesterday's edition of The Observer. Is the right hon. and learned Gentleman aware that a Nigerian student, who had done nothing wrong whatever, was so badly kicked in the groin by the police that he had to have a testicle removed, yet the DPP accepted without further inquiry that the guilty police officers could not be traced? Surely such cases make a farce of the DPP's role under current procedure?
    The Attorney-GeneralOf the cases that are reported to the Director of Public Prosecutions as a result of complaints of assault made against the police, many are for minor technical assaults, such as pushing, when no injury has followed. The cases that are the basis of my answer may be those in which there have been a number of complaints involving one police officer, or a number of police officers that are treated as one case. The figure of 2·06 per cent. relates to cases and not individual police

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    officers. I have this morning spoken to the Director of Public Prosecutions about the article that appeared in The Observer. I have asked him to look into it and to report to me.
    Mr. ChapmanSome cases may not be prosecuted because there is a lack of evidence or independent witnesses. Will my right hon. and learned Friend indicate the proportion of alleged assaults by the police that are not proceded with because it is found that the allegations are totally unfounded or even maliciously brought?
    The Attorney-GeneralI do not know the proportion, but in view of the percentage figure I have given, there must be a number of such cases. The conviction rate for assaults by police officers in such cases is considerably lower than the average conviction rate. That may indicate that the Director of Public Prosecutions has prosecuted too many rather than too few.
    Mr. ArcherWill the right hon. and learned Gentleman confirm that of all cases under section 49 of the Police Act 1964, those referred to the Director of Public Prosecutions as disclosing possible criminal offences are usually the most serious? If they are, and if they do not result in prosecutions, they are not dealt with under police disciplinary regulations. Surely this means that the most serious allegations are frequently the ones that result in no action being taken.
    The Attorney-GeneralI wish that that were so. Unfortunately, discretion lies with the chief officer of police who, unless he is satisfied that there is no prima facie case, has to report the issue to the Director of Public Prosecutions. It is our experience that the chief constable, anxious to avoid any criticism that he is protecting his own men, reports many cases in which there is not even the start of a case against the officer concerned. That is why the figures of reported cases are high and why the figures of those that lead to prosecution are so low.

    Contempt of Court Act 1981
    Mr. Christopher Priceasked the Attorney-General if he is satisfied with the operation of the Contempt of Court Act 1981.
    The Attorney-GeneralThe Act has been in force for only five months. So far I have not found any problems in operating it.
    Mr. PriceWill the Attorney-General review the behaviour of certain magistrates now that they are armed with the new power of imprisoning people for contempt in the face of the court? Has he heard of the case in which a man was sent to prison for not standing up straight in the dock?
    Mr. Beaumont-DarkQuite right.
    Mr. PriceSecondly, has he heard of the case in which a man was sent to prison for writing a cheque on the carcase of a dead rat, on the ground that his house was rat-infested and he wanted to draw attention to that fact? The right hon. and learned Gentleman knows that it is perfectly legal tender to write a cheque on any substance, however distasteful. Given the recent Home Office report on overcrowding in our prisons, does the right hon. and learned Gentleman think, in retrospect, that it was a mistake to give magistrates the power to add to the prison population for these utterly trivial offences?
    The Attorney-GeneralThe control of magistrates is not a matter within my powers. I read of the case of the man who did not stand up at all while he was being addressed by the magistrate. With regard to the use of unusual documents for cheques, I have heard only of toilet paper being used. This is the first time that I have heard of a dead rat being used.

Railways (Industrial Action)
Mr. Les HuckfieldI beg to ask leave to move the Amendment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the failure of the British Railways Board to honour its agreement to pay all footplate staff a 3 per cent. increase from the beginning of this month and its consequences for industry and the travelling public."
I am aware that this is not the first time that I have made this application. Therefore, I shall try to spare you tedious repetition, Mr. Speaker. However, it bears repeating that the issue is specific, because the documentation provided by the Railway Staff National Tribunal and the understandings emanating from the Advisory, Conciliation and Arbitration Service are both ample evidence that the agreement was made by the British Railways Board to pay that increase.
That documentation and evidence are supported by the Trades Union Congress—the general secretary of the TUC has made a statement to that effect—and the case made by the Associated Society of Locomotive Engineers and Firemen is supported by the general secretary of the TUC, senior members of the TUC general council and a large number of other trade unions. Therefore, the issue is specific.
The issue is obviously important. I do not need to tell the House that the industrial consequences of railway stoppages on specific days are cumulative, because if railway wagons and rolling stock are not in the right part of the system it adds to the deterioration of services.
The issue is also important because, due to action on specific days, there is bound to be serious disruption to various administrative processes, particularly in the capital city and some of the large cities. The commuter services provided by British Rail are necessary to convey to and from work large numbers of people engaged in those processes.
Unfortunately, the situation has been exacerbated by what many of us consider to be obnoxious articles in The Sun on Friday and Saturday. Those whose methods and motives can be described only as dubious chose to go outside the established procedures to deal with such
616
complaints. Because they have done so there has been further disruption. Other railway men support that action. Therefore, no one can now doubt that the issue is important.
Most of all, it is urgent that the House should now have a chance to debate this subject. It is urgent to do so because the dispute has now been going on for more than two weeks. Further dusruptions are planned for this week, and there seems to be no end in sight, despite further intervention by ACAS. As no end appears to be in sight, and as the House has not yet had a chance to voice its opinion and assess the facts and figures that can be marshalled, it is urgent that the House should have a chance to examine those facts and figures. The board is in dire financial straits because of the attitude taken by the Secretary of State and the Government to the board's finances.
Therefore, because this is an urgent and important matter, I hope that the House will have an opportunity to discuss it as soon as possible.
Mr. SpeakerThe hon. Member for Nuneaton (Mr. Huckfield) gave me notice before 12 noon today that he would seek to make an application under Standing Order No. 9 this afternoon.
The hon. Gentleman asks leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he thinks should have urgent consideration, namely,
"the failure of the British Railway Board to honour its agreement to pay all footplate staff a 3 per cent. increase from the beginning of this month and its consequences for industry and the travelling public."
This House will have no doubt about the importance of the matter that the hon. Gentleman has raised, but it also knows that Standing Order No. 9 is not the only way by which it can be discussed by the House. All that I have to do is to decide whether it is of such a nature that it must be discussed tonight or tomorrow; otherwise the decision rests elsewhere than with me.
The House has also instructed me to give no reasons for my decision. I listened with great care to what the hon. Gentleman said but I must rule that his submission does not fall within the provisions of the Standing Order, and therefore I cannot submit his application to the House.

British Leyland
Mr. Stan ThorneI beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the failure of British Leyland management to negotiate with the trade unions regarding their plans for the future of British Leyland."
It has become more important that we should debate this matter because of the statements made by the Secretary of State for Industry during Question Time today. They showed his abysmal ignorance of the real situation at Leyland.
The strike of workers at British Leyland, many of whom live in my constituency, and of the workers at Bathgate, is not about wages and conditions. Several trade unions are involved, including the Amalgamated Union of Engineering Workers, the Technical, Administrative and Supervisory Section of the AUEW, the Transport and General Workers Union and others.
Those unions have made a carefully prepared plan for the future of British Leyland, which the management has steadfastly refused to discuss and negotiate with them. This is a classic case of the management's concept of its sole right to rule in an organisation. The work force must obey, or else. Redundancy and closure are threatened in the absence of the management's willingness to recognise that the trade unions have a realistic plan, which merits its full consideration.
Two years ago 9, 000 workers were employed at British Leyland. There have been 1, 800 redundancies announced, and thereafter just over 4, 000 workers will remain. That state of affairs is serious for the whole Preston travel-to-work area. Therefore, Mr. Speaker, I urge you to grant my application.
Mr. SpeakerThe hon. Member for Preston, South (Mr. Thorne) gave me notice before 12 noon today that he would seek to make an application under Standing Order No. 9 this afternoon.
The hon. Gentleman asks leave to move the Adjournment of the House for the purpose of discussing a significant and important matter that he thinks should have urgent consideration, namely,
"the failure of British Leyland management to negotiate with the trade unions regarding their plans for the future of British Leyland."
I listened with deep concern to what the hon. Gentleman said, as I am sure the whole House did. The House knows that it has instructed me to give no reasons for a decision when such an application is made. I listened with care to what the hon. Gentleman said, but I must rule that his submission does not fall within the provisions of the Standing Order, and therefore I cannot submit his application to the House.

STATUTORY INSTRUMENTS, &C.
Ordered,
That the draft Aviation Security Fund Regulations 1982 be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Goodlad.]

Orders of the Day
  SUPPLY
  [9TH ALLOTTED DAY]—considered.

  Fuel Bills
  Motion made and question proposed:
  That this House calls upon Her Majesty's Government to take immediate action to help those in greatest need to protect them from the consequences of extreme weather this winter by:(a) instructing the gas and electricity industries to cease all disconnections for the next three months, (b) extending Government help by paying to all recipients of State benefits a double payment in one week in the month of February and (c) extending further such help by paying a winter quarter's fuel bonus to those receiving rent and rate rebates and not otherwise included.—[Mr. John.]
  Mr. SpeakerI have selected the amendment in the name of the Prime Minister.
  3.39 pm
  Mr. Alex EadieDealing first with the preamble to the motion, although I have been unable to list the freezing temperatures that engulfed the country, it is a fact that we have had the worst weather in the living memory of most of our citizens.
  I have selected three examples from the press reports.
  The Daily Telegraph of 9 January carried the headlines:
  "Britain in grip of blizzards…Sea freezes as temperatures fall"
  and went on to state:
  "The weathermen say it is the worst winter since 1962–63, with the coldest December since 1890 being followed by, an equally icy January. More snow is on its way and there is no sign of a thaw until Tuesday."
  The Western Mail stated:
  "Savage grip seizes most of Britain"
  and continued in similar vein. The Daily Telegraph, again, on 11 January said:
  "No let-up as big freeze beats record"
  and went on to describe temperatures recorded as being the lowest in living memory.
  I mention those facts because there has been widespread criticism of the Government for failing to act during the agony that the nation was undergoing. Because the terms of the amendment suggest that the Government are so busy congratulating themselves on its wording the Government leave themselves open to the charge that they have not fully grasped the severity of the winter period.
  The House must be aware of the welter of controversy surrounding the arbitrary decisions of the gas and electricity boards involved. On 10 August last, reviewing Jane Lorant's pamphlet, "Poor and Powerless—Fuel Problems and Disconnections", The Guardian headline ran:
  "Fuel cut off in 770 homes daily over unpaid bills".
  That may not be regarded as current, but the pamphlet is extremely relevant to this issue.
  In order that the House may appreciate the magnitude of the problem, I quote an extremely current view from a letter that has come into my possession. Incidentally, it is not from a constituent of mine, but I shall not mention the name of the constituency. The writer says:
  "I have to tell you, in the hope something can be done"
  and goes on to state that in his district electricity and gas disconnections

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  "average 30/40 a week. One such case I have been with all day today trying to help her, a young widow with two small babies, a boy of 4 years and a girl of 2 years. When I went this morning the wee lad asked me if I was there to mend the fire. I, as a grown man, was choked. The young woman was disconnected, she has no heating or cooking facilities. The children are dressed in coats, woolie hat and gloves because it's bitter inside the home. There hasn't been a hot meal since Wednesday, 6/1/82. She was widowed 5 months ago and she has been and still is paying for her husband's funeral week by week, so she couldn't pay for the electricity that was being used so she has been cut off."
  I submit that such a letter diminishes every one of us in the House.
  The Government must be aware of the various publications and the representations made by a wide spectrum of organisations pointing out the limitations and the ineffectiveness of the codes of practice. Since it became known that today's debate would take place, a shower of documentation has come into my hands. I received representations today from Age Concern. The Right to Fuel campaign estimated in its document that in the year ending September 1979, 86, 854 people were disconnected. Corresponding figures at September 1980 were 117, 189, with the two most recent quarters showing the highest figures since 1975.
  The Minister must be aware of the Policy Studies Institute report, which states:
  "Over the past four years there has been an annual average of 115, 000 electricity disconnections and 37, 000 gas disconnections…These figures represent 6 and 3 disconnections per thousand customers respectively."
  Those documents and other evidence that could be given suggest that there is a case for suspension. The motion states that, with the cruel weather added to all this, it is imperative that the gas and electricity industries cease all disconnections for the next three months. We do not regard seven days' notice of intended disconnection as sufficient. We wish to hear the Government's views on the PSI review. Moreover, the second part of the motion calls for the Government to help
  "by paying to all recipients of State benefits a double payment in one week in the month of February".
  The National Association of Citizens Advice Bureaux issued a press release on 20 January in response not only to the PSI review of the electricity and gas industries dealing with the code of practice but to its own experience in the bureaux' day-to-day work. The chairman stated:
  "Our bureaux are already inundated with enquiries from people with serious and multiple debts, among which those for fuel inevitably loom large. I dread to think what the situation will be when fuel bills for the current quarter, with its unusually hard weather, start coming in. It is essential that action is taken immediately to meet an exceptional situation."
  Referring to the code of practice, the association continued:
  "Fuel poverty is caused by low incomes combined with the high and increasing cost of fuel and the problem cannot be examined fully without reference to these issues…The high cost of fuel is a result of Government policy and unless this is changed, and for example, fuel subsidies are reintroduced, the fuel industries can do little to lighten the burden on the domestic consumer."
  The conclusions and recommendations of the PSI report are summarised under a number of headings:
  "Repayment arrangements…Prepayment meters…The welfare agencies…Monitoring and arbitration",
  and so on. It would take too long to deal with them all, but we certainly wish to hear the Government's view.
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  Certainly, in this debate, we are entitled to ask what is to be done about the immediate changes that the PSI recommends.
  First, the PSI recommends a timetable for discussions and implementation of the main recommendations in the review. What is the Minister's response to that? Secondly, the PSI recommends that the present codes be strictly observed. Its third recommendation is that tenants should not be disconnected in respect of a landlord's debt. The fourth recommendation is that boards in regions with above average disconnection rates should review their policies. Fifthly, the PSI says that customers with large accumulated debts should be offered a long-term payments plan.
  The sixth recommendation is that the industry should list all the large accumulated debts so that a discussion of the possibility of a partial write-off can take place in the light of the scale of the problem. The seventh recommendation is that debt ceilings under the "fuel direct" scheme should not be applied and, lastly, that customers who have been without a supply for a month or more should be offered a pre-payment meter geared to recover the debt.
  The Department of Health and Social Security has circulated its offices asking them to put into operation the new regulations that provide for single payments of fuel costs in exceptional weather. I have a copy of those regulations. They are anything but simple. An enormous responsibility will be placed on the Department if it is to implement them satisfactorily. The Minister should give an account to the House of how the regulations are to be implemented. We say to the Minister that a double payment in one week in February should be implemented.
  The last part of our motion calls for help to be provided by the payment of a winter quarter fuel bonus to people receiving rent and rate rebates who do not otherwise receive such a payment. In the winter of January 1979 that section of the population received a discount if their electricity bill was more than £20. I do not suggest that that was satisfactory, but the principle was conceded. It was conceded that that section of the population deserved help. Why should such people be excluded from help when they have been confronted with such a severe winter?
  We are discussing a section of population that earns low incomes. I hope that the Minister will not tell us that the money is not available and that he will not underline the present spending level. I assume that he will tell us that £250 million is the present spend.
  Money is available. Let us examine the Social Security (No. 2) Act. Under that Act large sums of money were grabbed by the Government which should and could have been ploughed into fuel asssistance. I shall list the money that was grabbed from the poorer sections of our population.
  Under section 1 of the Act a reduction of 5 per cent. in real terms took place in unemployment benefit, invalidity pensions and other short-term national insurance benefits. The Government told us that there was a saving of £140 million in a full year in that respect. Under section 2, the freezing of the earnings rule for retirement pensioners saved £16·5 million in a full year.
  Section 3, which reduces the linking period for spells of unemployment and incapacity from 13 to eight weeks, saves £10 million a year. Under section 4 the abolition of the earnings-related supplements from January 1982 saves £360 million a year, and represents an average weekly loss

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  on sickness benefit of £13; on unemployment benefit, £11·20; on injury benefit, £14·10; on maternity allowances, £8·80; and on widows' allowances, £14·90.
  Under section 5 the reduction of unemployment benefit for certain occupational pensioners saves £25 million in a full year. Under section 6 there is a reduction of £13 in supplementary benefit entitlement for strikers' families, which saves about £1 million a year. Money is available to deal with the problem. The Government say that they are spending £250 million, but hundreds of thousands of pounds are available as a result of the Social Security (No. 2) Act.
  The Government can do much more in addition. They could examine fuel and lighting. The Government will concede that fuel and lighting costs increased by 345 per cent. for domestic consumers between 1971 and 1981. People are trapped within their home environments. They have no choice in the heating that they can use. Their homes are constructed to give them two choices, at the most. Some homes have no chimneys, so that coal or any other solid heating material cannot be burnt. Coal stocks are at a record level of 40 million tonnes. It would help some consumers if a scheme for concessionary coal prices were introduced.
  I promised my hon. Friends that I would speak as briefly as possible. I shall try to underline what I have said. Thomas Paine told the world that God did not make people rich or poor. He made male and female and gave them the earth as their inheritance. We want the people to whom we refer in the motion to receive that inheritance. Unless the Government respond to the motion my right hon. and hon. Friends and I are determined to march into the Division Lobby and vote for it.
  3.59 pm
  The Under-Secretary of State for Energy (Mr. David Mellor)I beg to move, to leave out from "That" to the end of the Question and to add instead thereof,
  "this House welcomes the steps taken by Her Majesty's Government to protect those most at risk from severe weather in having: (a) at the beginning of this winter fully maintained the value of last year's already substantial help with fuel costs, (b) maintained in the new supplementary benefit scheme provision for payments to meet the extra cost of additional fuel consumption during exceptionally severe weather and (c) continued co-operation with the fuel industries to ensure that the industries' code of practice on payment of bills is operated effectively; and further welcomes the consideration and initiative shown by electricity boards in recently suspending disconnections for seven days".
  The hon. Member for Midlothian (Mr. Eadie) has spoken on energy matters for the Labour Party, in Opposition and in Government, for almost a decade. I congratulate him on that achievement. That makes it all the more difficult to forgive him for one or two of his assertions this afternoon. He will have on his mind, if not on his conscience, the record of the Labour Government of which he was a member. He knows that if our roles today were reversed he would no more accede to the motion than I can.
  The hon. Gentleman would not for a moment, for instance, have contemplated a cessation of disconnections for three months. We have just come through a difficult winter, but there were hard winters under Labour. The winter of 1978–79 was in many respects harder than the one through which we have just come. Just how hard that
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  winter was is brought to our attention today in the Electricity Consumers Council pamphlet on elderly electricity consumers, which received some press today.
  What was not clearly explained was that that was based, in the main, on data collected during the lifetime of the Government of which the hon. Gentleman was a member. It is right to say that during the five years that he was at the Department of Energy no action was taken by the Government to persuade the industry to stop disconnections. I shall not go into the business of trading figures with the hon. Gentleman, but for every figure that he quotes for disconnections I can quote years during which the disconnection record under the previous Government was substantially worse.
  The reason why the hon. Gentleman, when he was a Minister, would not have contemplated issuing such a directive to the industry is clear. It is because of the enormous cost implications that it has for, first, the industry and, secondly, for other consumers. It could only result in increased prices to many people who, while they pay their bills, would not consider themselves to be in a position to bear additional costs because of those who have not paid their bills.
  The second part of the motion concerning an extra week's payment in February sounds all very well when advocated from the Opposition Front Bench, but the hon. Gentleman, with his experience of Government, must know that this is a wholly impractical suggestion. Even if it were desirable, it would be impossible to arrange in the time scale set out in the motion. Indeed, I almost rubbed my eyes in disbelief when I saw the proposal.
  The hon. Gentleman knows that in the financial year 1975–76 the level of disconnections for both gas and electricity—those were the years when the hon. Gentleman was at the Department of Energy—were higher than in any of the years during which the present Government have been in office. Yet the hon. Gentleman and other right hon. and hon. Gentlemen on the Front Bench managed to keep their consciences still in 1975 and 1976, when they would not even pay the old folks their Christmas bonus.
  Mr. George CunninghamThat is enough of all that. Let us get on with it.
  Mr. Andrew F. BennettWill the hon. Gentleman give way?
  Mr. MellorI shall not give way now. I shall give way later on.
  It is difficult to find very much in the motion that I can accept. I shall not allow—and this is where I shall aim to meet the point made by the hon. Member for Islington, South and Finsbury (Mr. Cunningham)—the manner in which the hon. Member for Midlothian has put the case this afternoon to deflect me from recognising that many people face serious problems this winter, just as they have faced serious problems during previous winters. I am sure that the hon. Gentleman will have the honesty to admit that. I am sure that the hon. Member for Birkenhead (Mr. Field)—whose record in these matters is free from any taint of hypocrisy, or almost free—is ready to admit that.
  While it would be impossible for me not to begin my remarks by addressing myself to the two specific suggestions that were made to the Government, I wish to

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  deal, in as non-partisan a way as circumstances will allow, with the problems that exist and the remedies that the Government have sought to put forward.
  It is no part of the Government's philosophy that the old and the needy should be worried or cold this winter or any other winter. Well before the onset of this winter, it was clear that the Government accepted an obligation to assist the worst off with their bills. My hon Friend the Under-Secretary of State for Health and Social Security—the Member for Wallasey (Mrs. Chalker)—who is responsible for these matters at the Department of Health and Social Services, has a well-known commitment to the disadvantaged and it needs no commendation from me. She will have something to say on these matters when she winds up the debate.
  Mr. John MaxtonAfter that panegyric for his ministerial colleague, will the hon. Gentleman explain why, when the Minister met the South of Scotland Electricity Board in Scotland in relation to the £150 cut-off rate that it has against direct payment by the DHSS, an agreement was reached that an order would be placed before the House allowing for two separate types of payment to be made in "fuel direct" if a household's appliances were only electrical. The Minister promised that, but it still has not been done. That is creating problems for consumers in my constituency and for other consumers in the South of Scotland Electricity Board's area.
  Mr. MellorI am sorry that if offends the hon. Gentleman that one member of the Government Front Bench speaks warmly of a colleague. I recognise that that does not happen as often on the Opposition side of the House. My hon. Friend the Under-Secretary of State for Health and Social Security will deal with that matter when she winds up the debate. On the matter of the propriety of any fuel board having a debt limit for "fuel direct", I shall speak about that later, as I have addressed my mind to the matter.
  I come to what the Government have been doing this winter for poorer consumers of fuel. About £250 million has been made available in heating supplements. Even allowing for inflation, that is the largest sum that has ever been allocated for that purpose. It is important to recognise that that figure is substantially more than was made available in the last winter during which the hon. Gentleman had care of energy policy. Any suggestion that this is in any way a niggardly response can be met by referring to the fact that each and every winter week some poor consumers are benefiting to the tune of over £4. That is well worth having in addition to all the other entitlements. About 2¼ million people are being assisted.
  In addition my right hon. Friend the Secretary of State for Social Services has made it clear that a lump sum payment will be made in cases in which it can be established that an exceptional payment to cover increased demand on fuel bills this winter would be appropriate.
  Mr. Frank FieldWill the Minister clarify how that scheme will operate? Is it not a fact that the Government are still allowing regulation 5 of the regulations to operate, which forbids the giving of help to any claimant with savings of more than £300? As most pensioners have £300 put aside for their funerals, does this
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  not mean that almost no pensioner couple or single pensioner will get help under the scheme and that, because they will not get help, some may have to spend their funeral money more quickly?
  Mr. MellorThat is the second perfectly proper interruption on matters of policy relating to the DHSS. My hon. Friend the Under-Secretary of State for Health and Social Security will wind up the debate and it may be more appropriate for her to deal with that matter. [Interruption.] I am sorry that the right hon. Member for Leeds, South (Mr. Rees) considers that that was an improper observation. I am sure that the division of responsibility occurred under the previous Administration also.
  On the subject of assistance, there is always an issue about whether the categories are wide enough. There is always a case to be made for people who are just over the limit. I know that my hon. Friend is aware of that, but the reality is that to spread more widely must inevitably mean spreading more thinly, given the difficulties under which successive Governments have had to operate.
  I give, as an example, the electricity discount scheme. I was glad to see that the hon. Member for Midlothiam was not seeking to rewrite history and say that that was the answer. He knows, and the House knows, that the average payment under that scheme was one payment of £7·50 in one quarter. That is far less than the help that is being concentrated on more than 2 million people by the policies of the Government.
  I deal next with matters of more central concern to the Department of Energy which are highly relevant to the matters under discussion today. Fuel prices to domestic consumers genuinely reflect the cost and other market pressures on the supply industries. The electricity industry made a loss last year and is likely to do so again this year. As the hon. Gentleman rightly pointed out, the 1970s was a decade of dramatically increasing prices to domestic consumers under successive Governments. I hope that that is now behind us. There is the prospect of that.
  This winter domestic electricity consumers will receive a rebate of about 8 per cent. of their average quarterly bill. In cash terms that is about £5 per household. That is because the increase in the price of coal was less than the electricity supply industry expected. The National Coal Board intends that this increase should suffice for 12 months following its announcement. For the first time since 1973 the annual increase in the price of coal will be less than the overall increase in the retail price index. The price of coal is a factor of fundamental importance in determining the cost and hence the price of electricity. It is one of the principal reasons why the nation will welcome the outcome of last week's miners' ballot.
  I now come to the gas industry. The Government have taken steps to alter the ludicrous situation that prevailed when the hon. Member for Midlothian held office, whereby the British Gas Corporation was making a loss on the sale of gas to the home. It should be understood by the House and outside that, even allowing for the increases that have been announced by the Government, gas is cheaper in real terms—indeed, 20 per cent. cheaper—than it was 10 years ago. For an elderly couple, dependent wholly on State pensions and other benefits, the cost of using a gas cooker and heating their living room will be about half in real terms what it was 10 years ago. This explains why gas sales have doubled in the past 10 years and why over 2½ million more householders are on gas

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  compared with 10 years ago. International comparisons are frequently made. Domestic consumers in France and Germany are paying 60 to 90 per cent. more for their gas than their counterparts in the United Kingdom.
  The question of disconnections, to which the hon. Member for Midlothian drew attention, has been of considerable concern to me during my time at the Department. I welcome the Electricity Council's recent announcement of a seven-day pause in disconnections during the worst of the winter. I have had the opportunity of discussing this matter with the chairman of the Electricity Council, who has every reason to suppose that area boards would act in a similar manner in future severe cold weather.
  Mention has been made of the code of practice and the PSI report. I attach the greatest importance to the code of practice and to the supply industries acting with sympathy and discretion in matters of disconnection and repayment of debts. The code has already been revised once under this Government, when my hon. Friend the Member for Kingston upon Thames (Mr. Lamont) was responsible for these matters. This led to a relaxation of the criteria for prepayment meters. The hon. Member for Midlothian will, I know, welcome that, as he will also welcome the news that, in the second quarter of 1981 as against the second quarter of 1980, the number of prepayment meters connected by the electricity industry was up 50 per cent. The code was also amended, under the aegis of my hon. Friend, to make mention for the first time of the blind and the disabled.
  The PSI report was commissioned by the previous Government. The amendments to the code to which I have referred went forward notwithstanding the fact that the report was not available. This shows, I suggest, the importance that the Government attach to action in this area. The report shows that the code, on the whole, is working well, but it makes a number of suggestions for improvements. I was pleased to see the positive reaction from the industries and the consumer councils to the report at the meeting of sponsors of the report that I chaired on 13 October. As the hon. Gentleman will know, we are now in a period of consultation. The report has been made widely available. Anyone with views on the matter is able to contact the industries and play a part in making suggestions for improving the code.
  It seemed to me of the essence that a deadline should be set as early as possible. This would enable any amendments to the code that were necessary to be brought forward before the impact of the main winter quarter's fuel bill. That is why I have asked the industry—I asked back in October before we knew how bad the winter would be—that it should make its report to me in February so that these changes could be implemented before the March bills arrived. I have been asked for information on how these matters are going. I must say that I was impressed by the positive atmosphere that prevailed at the meeting on 13 October.
  A number of points arose at the meeting that may interest hon. Members. It was clear on all sides that the code must be strictly observed by all boards. Secondly, it was clear that debt limits on fuel direct should be eliminated. There is no doubt in my mind that this is the proper course to adopt. There should be the closest liaison between the industries and the Department of Health and Social Security or the social services departments of particular local authorities in order to smooth over the
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  difficulties that can arise both while "fuel direct" is going forward and to meet the case of people who may come off "fuel direct" but still need the right kind of repayment arrangements to be made. Further efforts should be made to ensure that reasonable repayment arrangements are available to all customers who might benefit from them.
  The Government are not happy that all that could be done is being done on prepayment meters. This matter is being studied by the industry. Further efforts have to be made to find sensible solutions to the problem of large accumulated debts. I look forward with interest to the response of the industries. I shall welcome any representations that are made.
  Mr. MaxtonHon. Members and many electricity consumers will be grateful for the statement that the Minister has made on no limits in terms of fuel debts for direct payment. Will he give an assurance that there will be some form of legislation to ensure that electricity boards carry out what he says? So far as I am aware the South of Scotland Electricity Board has no intention of raising its limit, or if it has. of only raising it and not abolishing it altogether.
  Mr. MellorThe hon. Gentleman may find that he is being pessimistic. It would be wrong for me to jump ahead on that basis. I have no reason to think that people will not take seriously the undertakings into which they enter It should come as no surprise to the hon. Gentleman that Conservative Members take a sympathetic view when in office. I represent an inner London constituency. I am aware of the problems, just as Opposition Members are aware of them. One is anxious, within the bounds of what is possible, practicable and fair to all consumers, to try to reach sensible arrangements that will assist the poorest members of the community.
  I wish to make some remarks about the present winter. Plainly, the advice that comes from the industries and from my Department to people who are concerned about their bills is "Do not sit at home cold and fretting. Go and talk to the industries before the bills arrive. Get advice on easy payment methods." Much time, trouble and effort have gone into devising the different easy payment methods that are set out in the code. There is plenty of opportunity to make views known if it appears that people have been rebuffed. I have no reason to be cynical and think that they would be rebuffed. I hear hon. Members clicking their tongues. If they are rebuffed, the matter can be brought forward in the proper way.
  I wish to be clear on one matter. It has been the view of successive Governments that the power to disconnect must be retained by the industries as the only way of protecting the interests of all consumers. However, it should only be a last resort after every fair and reasonable alternative solution has failed. About 0·5 per cent. of all consumers are subject to disconnection. It would be wrong indeed if, in some of those cases, people were permitted to build up large bills, which could only worsen the industries' financial position and lead to additional costs, which would fall on other consumers. I wish to stress, so that it is clearly understood, that disconnection has to be the very last resort. All those who contribute to the debate on the matter must do all in their power to make sure that all fair and reasonable steps are taken before that point is reached.
  I apologise for detaining the House for longer than I had intended, but there is a further matter that I wish to

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  mention. I have already spoken about prices and disconnections. The third limb, which is of great concern to me as a Minister at the Department of Energy, is insulation. We know that all householders qualify for some grant assistance under the Department of the Environment's schemes. I know that all right hon. and hon. Members will have welcomed the recent extension of the 90 per cent. grant to the disabled poor as well as to the elderly poor. I attach particular importance to insulation schemes for the poor and the disabled.
  Last week I had the privilege of visiting two of the best neighbourhood schems, one in Fulham and the other in Newcastle. My Department is making grants available to help voluntary organisations in setting up insulation projects. The Manpower Services Commission will spend about £2½ million this year on funding some 37 projects employing about 400 young people, who would otherwise be unemployed, to insulate about 30, 000 homes of poor householders. Plans are already afoot to assist a further 12 schemes, employing a further 150 young people, to add a further 20, 000 dwellings per annum to the 30, 000 that I mentioned earlier. It is clear that many consumers, particularly the poorer consumers, have everything to gain from these projects, because they often live in accommodation that is not well insulated. My hon. Friend and I saw major works being carried out in Fulham on a pensioner's home, which cost the lady only £4 for a team of five men who took almost a whole day to insulate her loft.
  We are under no illusion about the hardship that this winter has caused many people. Nor are we self-satisfied about the steps that we have taken. However, we are entitled to say that not only are we aware of the problems, but that we anticipated a number of them to a considerable extent and have done a good deal to alleviate them. It is clear that more is being done this year than in any previous year, however far back one looks. It is possible that more can be done in future years as resources become available, but I ask the House to accept that, in today's circumstances, real progress has been made to help the poorest off with their fuel bills at this difficult time. I hope that in due course the House will reject the motion.
  4.23 pm
  Mr. David WinnickI am glad that this debate is taking place today. It certainly concerns a subject that should be discussed here.
  There can be no doubt about the immense difficulties faced by many people on low incomes, certainly the elderly, in trying to keep their accommodation adequately heated during the winter months. Reference has already been made to the report of the Electricity Consumers' Council, and to the survey that has just been brought out by that council which shows the problems that are being faced, particularly by elderly people. It shows, for example, that on average pensioners spend less on fuel in the winter than other households do in the summer. It shows that 40 per cent. of elderly households do not heat their bedrooms at all during winter. As we expect, because of our knowledge of such matters, elderly people spend a larger proportion of their budgets on fuel, but have a lower level of heating that the average household.
  Much play has been made by the Government today and on previous occasions of the amount of money that they
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  are allegedly spending. The Minister said that £250 million is being spent to help low-income households with their fuel bills. That seems a rather impressive sum, but in a reply that I received recently to a question in which I asked for a breakdown of the £250 million, the Minister of State, Department of Health and Social Security, said that the bulk of that sum was linked to supplementary benefit payment, which in fact has been paid by successive Governments. What is important is how much new money out of that £250 million is being spent. It appears that it is very little indeed. For example, the sum of £1·65 that is given weekly to pensioners over the age of 70, who must be on supplementary benefit, does not add up to a large amount of money. It adds up to £21 million—that is all. For households on supplementary benefit where there is a child under the age of 5, the total amount is £16 million. Thus, the amount of new money that has been introduced by this Government to help the lowest paid and the lowest income groups with their fuel bills is very small. I might add that it is somewhat misleading of the Government to keep referring to the sum of £250 million as though they had introduced that amount of benefit in the first place.
  Mr. Tristan Garel-JonesIf the figures that the hon. Gentleman quotes are correct, surely it means that this Government have increased expenditure in this area by approximately 15 per cent. That is not too bad, is it?
  Mr. WinnickIf one takes into account the discontinuation of the electricity discount scheme and the rate of inflation, the improvement is minimal, to say the least.
  One of the Government's first priorities should be to pay the £1·65 weekly on a permanent basis to all those who receive supplementary benefit, bearing in mind, of course, that people on supplementary benefit are among those who receive the lowest income. It is difficult to go below the scale of supplementary benefits, and yet any elderly retired couple under the age of 70 on supplementary benefit receives no assistance at all. I leave aside, of course, the single payment that is to be introduced this winter. It should be a priority, in my opinion, to extend the increase to pensioners under the age of 70.
  It is also unfortunate, as my hon. Friend the Member for Birkenhead (Mr. Field) pointed out in an intervention during the Minister's speech, that the single emergency payment which is to be paid to those on supplementary benefit will not be paid if the person concerned has more than £300. The Minister said that the Under-Secretary would refer to this matter in her reply. I have already received a written answer from the Under-Secretary in which she confirmed it. People—pensioners in particular—who in many cases have saved at least £300—usually for burial purposes, and so on, as my hon. Friend said—will not receive any help under the emergency scheme. We already know that those who have more than £2, 000 cannot receive any supplementary benefit at all, but this is a new form of discrimination against the poorest people in our community, whereby those who have more than £300 cannot receive any help, if they are on supplementary benefit, towards winter fuel bills. I hope that the Government will reconsider this matter.
  There are other people, about 1 million pensioners, who receive rebates—rent rebates, and so on—but who are not on supplementary benefit and who receive no help at all

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  with their fuel bills. To receive a rebate in the first place it is necessary to have a pretty inadequate income. Here we have almost 1 million pensioners who receive rebates, so clearly their incomes are sufficiently low for them to qualify for rebates, but for one reason or another they do not receive supplementary benefit. Surely some help could be given. They receive no help on a permanent basis, and they will receive no assistance under the single payment scheme for this winter. The weekly payment of £1·65, which is a pretty small sum anyway, should be extended as a matter of priority to all those who receive rebates but who are not necessarily on supplementary benefits.
  Some elderly people do not fear having their gas or electricity disconnected, because they do not run up high bills. The reason for that is simple: they are so afraid of receiving a bill that they cannot pay that they either turn off the heat completely on a cold day, or hardly turn it on. Therefore, their homes are inadequately heated and they try to keep warm by wrapping up in blankets, by going to bed in an unheated room, and so on. That is the way that many elderly people spend the winter months. They are terrified of using fuel properly, because of the bills that will probably follow. They believe that they will not be able to pay them. That is part of the scandal.
  The Minister's speech was so complacent that he gave, on behalf of the Government, no glimmer of hope to those who face so many fuel payment problems. The danger of hypothermia increases when people are afraid of heating their homes adequately. As the Electricity Consumers Council survey pointed out, among those aged between 65 and 74 the death rate is 15 per cent. higher in the winter than in the summer and among those aged over 80, it is 25 per cent. higher in the winter than in the summer.
  We should also bear in mind that it is not only the elderly who are affected, but the unemployed, single parents, the disabled and all those on low incomes who find it difficult to heat their homes adequately in the winter. For some time I have argued—I did so during the period of the Labour Government and I have tried to press Ministers in this Government—for a comprehensive fuel scheme that will assist those on low incomes. There is no controversy about rent or rate rebates. Is there not, therefore, a strong case for a fuel rebate scheme that would at least give some hope to those on low incomes?
  Mr. Garel-JonesWhat about the Labour Government?
  Mr. WinnickThe Labour Government introduced an electricity discount scheme. It was a small beginning and was not a bold scheme. Nevertheless, it accepted the principle that those on low incomes deserve more assistance with their fuel bills in winter. Like my hon. Friends, I am disappointed that the Government have ended that scheme. The Government's scheme is far more inadequate than the electricity discount scheme that the Labour Government introduced.
  We must all accept that the price of gas and electricity has substantially increased during the past eight to 10 years. However, there is a strong case for limiting the increases in the price of domestic fuel. Under this Government the price of gas is being increased by 30 per cent. above the rate of inflation over a three-year period. I should have thought that gas and particularly electricity prices are sufficiently high for subsidies to be re-introduced. Whatever the position, if the Government of
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  the day say that gas and electricity prices are right, I, like my hon. Friends, will argue that they are obliged to ensure that those who cannot afford to pay them are assisted. I refer to the elderly, those on supplementary benefit, those who receive not supplementary benefit but rebates, and all those on low incomes. Such people are being penalised.
  Above all, the Government should recognise that such people are not in a position to pay the present price of fuel. The Labour Party recognises that there is an acute problem. The Government must act to solve it. Until such action is taken, hundreds and thousands of people will be unable to heat their homes adequately and will put themselves and their families at risk. It is those people we should help, and about whom the Government should be concerned.
  4.35 pm
  Mr. Barry HendersonI declare an interest, because during the recess I was appointed a consultant to a company in the private sector of the coal industry.
  I am grateful to the Opposition for having raised this subject for debate. The hon. Member for Walsall, North (Mr. Winnick) spoke about the disadvantaged. One of the greatest problems is that they lack information. If nothing else, I hope that the debate will provide information to those who are most seriously affected by the high price of fuel during such a severe winter. Except when the hon. Member for Midlothian (Mr. Eadie) spoke about some of the political issues that my hon. Friend the Minister has dealt with, I felt grateful to him for the sincerity and compassion with which he—a fellow Fifer—opened the debate.
  All sections of society and of industry are concerned about the cost of fuel, particularly during severe cold weather. Of all forms of energy consumption, heating is perhaps the most expensive. There is particularly deep concern for the elderly, who are faced by rapid and bewildering changes in the cost of energy. The Government have made it clear that they are committed to maintaining the real value of pensions by ensuring that they increase in line with the cost of living. I understand that the cost of living will be measured against the retail price index. I should be grateful if the Minister would assure the House that the fuel cost element of family expenditure will be fully reflected in the retail price index. There have been substantial changes in costs and if old age pensions are to keep pace with the rise in the cost of living, that important element should be fully reflected in the retail price index.
  Information and education are of prime importance and that is particularly true in relation to conservation, the best appliance on the market for heating the home, and—perhaps equally important—the best use of facilities in the home. Like the hon. Member for Walsall, North I am deeply concerned that the elderly may turn off the central heating and use some other form of heating. All too often the heating that they have turned on to save energy costs is more costly and much less cost effective than central heating.
  Much more could be done. Much of our conservation policy has been left in the hands of our nationalised gas and electricity industries. In some ways it is unfair that so much responsibility for education and conservation should be placed on them. After all, there is a conflict of interest. Such industries are in business to sell fuel. They will not

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  make money by encouraging people not to use such fuel. Alhough we must give great credit to those industries for helping to conserve energy and although those who seek guidance are generally given good advice, more must be done to ensure that there are more employees whose sole purpose is to advise about conservation and the best use of such an expensive commodity. Perhaps more could be done to achieve better liaison between those authorities responsible for consumer protection and those responsible for adult education. There seems to be considerable scope for night classes dealing with the organisation of heating bills and how to deal with them, especially when we think of some of the other subjects that are available at evening and adult education classes.
  I wonder whether we have done all that we can to seize the opportunities available through senior citizens' clubs such as Age Concern or Probus. There are many senior citizens' clubs. I wonder whether they are given sufficient information so that their members are aware of the facts in a rapidly changing situation and of how they might be helped in these difficult circumstances.
  I was interested in what the hon. Member for Glasgow, Cathcart (Mr. Maxton) said about the South of Scotland Electricity Board and the limit. I look forward to hearing the Minister's reply. If she gives a less than satisfactory answer, which would be unusual, I shall happily join the hon. Gentleman in a "sort-out" with the SSEB.
  I am sure that all hon. Members are aware of the anger felt by many people with small gas bills when they see that a high proportion of the bill is made up of the standing charge. One case drawn to my attention puts this into perspective. In September—not the worst part of the year—an old age pensioner received a gas bill totalling £8·79, of which £7 was for the standing charge. In other words, only £1·79 was for gas consumption. That highlights the problem that is giving concern to many of our constituents. It occurred to me that people faced with such a bill might be advised to buy an electric cooker for less than the cost of the standing charge, thereby acquiring an asset and at the same time having to pay an electricity bill that would be less than the combined gas and electricity bills that such consumers are currently facing.
  My arithmetic is not that good, so I decided to seek the advice of someone who understood these matters better than me. I wrote to the chairman of the SSEB, asking him whether
  "there might be scope for a marketing initiative by the SSEB where, as is so often the case, the only gas appliance is a stove."
  I explained the kind of thing I had in mind, and said that, apart from the consumer, the SSEB could benefit from increased sales. In his reply, on 11 December, he said:
  "The saving in the gas standing charge would be insufficient for the credit purchase of the larger electric cookers. It would, however, be about enough to buy a cooker like the Baby Belling, which has a retail price of £113 and which many old and single people find perfectly adequate."
  He asked the gas board who these small consumers were in order to offer them this kind of deal. It will not surprise the House to learn that the gas board did not take kindly to his suggestion. To be fair, the gas board pointed out that some people like an alternative form of heating and that there were some worthwhile reasons for having a high standing charge.
  The choice should lie with the consumer more than it does at present. I hope that my hon. Friends in the
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  Department, to whom I have written on this matter, will encourage these boards, wherever practicable, to get together on such schemes so that they are positively beneficial and give as much free choice to the consumer as possible.
  I am sure that all hon. Members are concerned about electricity and gas charges, but there is also concern in Scotland about domestic coal supplies. The National Coal Board's allocation policy is the last remaining evidence of a rationing system that was familiar at the end of the war. I am told that there is a shortage of domestic coal in Scotland, and that this was especially so during the severe winter weather. One of the alleged reasons is that coal is brought from the South while stocked coal is being crushed for use in power stations that already have substantial supplies. Apparently, the arrangements between the Government, the NCB and the electricity boards make that a better revenue earner for the NCB.
  On the other hand, the private sector, which supplies substantial amounts of domestic coal in Scotland, is limited by licensing and affected in its pricing by virtue of the fact that the royalty it pays to the NCB can be up to half the cost of the coal, for which the domestic user must pay. I welcomed what my hon. Friend said about the NCB's current pricing policy, but I believe that a freer regime in coal, as in many other industries, could be of great benefit to the consumer and the industry.
  Our ability to help the elderly and the disadvantaged, who are at the root of our concern, inevitably lies in the ability of the British economy and British industry to achieve success at home and abroad. Even when we are concerned about our constituents, we must bear in mind that industry is complaining about the cost that it must pay for energy and its effect on competitiveness. We should remember that the strength of our economy determines whether we can be generous to those whom we wish to help.
  4.48 pm
  Mr. Geraint HowellsWe like to think that we are a caring society, but in our rush for progress we often overlook the interests of those in need. That fact has been highlighted by recent reports of old-age pensioners and the sick suffering from inadequate heating during the severe winter weather that we have just experienced.
  It is well known that my constituency of Cardigan was the worst hit during the severe winter conditions that we experienced a few weeks ago. I have survived three storms on the hills on Plynlimon—one in 1947, another in 1963 and the third in 1982—but I still hold the view that the winter of 1947 was severe for everyone concerned, because it lasted more than 10 or 12 weeks.
  My area was severely hit by the weather, and I should like to pay tribute to the staff of Dyfed county council, the Ceredigion district council, the police and the RAF pilots—who in severe weather conditions did their utmost to fly patients to the hospitals in my constituency—as well as to the doctors, nurses and social workers who were involved in providing help.
  I wish also to give due praise to the media. They did a wonderful job. We could not receive newspapers, but we were in contact with radio and television. On behalf of my constituents I wish to say "Thank you" to the representatives of the media. I also wish to pay tribute to the engineers who worked so diligently and hard for the South Wales electricity board and the North Wales and

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  Merseyside electricity board. They did their utmost day and night, in severe weather conditions, to try to restore electricity supplies.
  Today's report of a survey conducted by the Electricity Consumers Council says that up to 10 per cent. of old-age pensioners try to spend less than £1 per week on heating. That figure is difficult to accept, but it is true. There is no need for me or anyone else to say that it is incorrect. They are also, apparently, resistant to prepayment meters and savings stamps. Elderly people are terrified of the high cost of fuel and would rather suffer the cold than have enormous bills to pay.
  We have some disturbing information from Dr. Geoffrey Taylor, who is a leading authority on the subject of the aged and the effects of cold weather on them. He has been saying for some years that even in comparatively mild winters the number of deaths rises by about 300 a day. This winter, he believes that figure to be nearer 600 a day, which is a 100 per cent. increase.
  According to the official statistics published and quoted in last Friday's Hansard, in only 596 cases was hypothermia even mentioned as a cause of death. However, Dr. Taylor is talking about 60, 000 to 90, 000 cold-related deaths this year, probably recorded as coronary attacks, strokes and chest infections. Unfortunately, successive Ministers, both Labour and Conservative, have sheltered for years behind a narrow definition of hypothermia to excuse their failure to face the massive increase in deaths during winter months.
  We have all been conditioned to accept the traditional view that the higher death rate is an inevitable effect of winter, but we must consider Sweden, where the death rate is almost stable throughout the year, to realise that we fall far short of the ideal in our care and concern for those in need.
  Our first priority should be to ensure that elderly people are aware that help is available, that they need not be terrified of keeping themselves warm and that any assistance given is their due and not charity. We are talking about a generation that grew up before the Welfare State. For many, the spectre of the workhouse is a real memory. Their fears must be overcome and the methods of relief explained to them and made easier to obtain.
  The Government's present arrangements do not provide for those who are thriftily saving for their own funeral or whose low income is increased by rent and rate rebates rather than supplementary benefit. Those old people should not be penalised, but should be granted automatic assistance with their bills without having to go through the complex procedures at present used.
  There should also be a more flexible approach, as recommended today by the Electricity Consumers Council, to the insulation of homes. I approve of its other recommendations—a reduction in electricity tariffs for pensioners with small bills and provision to sell electricity savings stamps in post offices for the convenience of old-age pensioners.
  The Government amendment shows a complacency that does them no credit. Despite their claims, the death rate this winter has risen and more and more old people have been put at risk because of the high cost of fuel and their reluctance or inability to seek help. The Opposition motion is inadequate, despite its good intentions. The first two clauses are much too indiscriminate in their application.
  The Liberal Party is anxious to see immediate action to help those in need, but it would prefer a greater awareness
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  of the problem by the Government—a realisation that every winter is dangerous for the old and sick and that there is a need for legislation to cater for the future instead of annual panic measures. We must reassure old people that we have not forgotten their special requirements, so that they need never again fear the onset of winter.
  Can the Under-Secretary of State, when she replies to the debate, assure the House that legislation will be introduced sooner rather than later to help the elderly and those in need?
  4.57 pm
  Mr. Paul DeanI, too, am glad that this debate is taking place. It is obviously topical, following the arctic weather conditions that we have had and following the individual cases of difficulty that have been faced by the most vulnerable in the community. I wish to ask, as a number of hon. Members have already asked in the debate, whether we are doing enough and especially whether we are covering a sufficient number of people in our present fuel arrangements.
  There is little doubt that the most vulnerable sections of the community are the old, the young and the disabled. The old, especially the very old, are more vulnerable because in many cases they live on their own. To those people especially, the fuel bill is probably the largest single worry in their existence. That is so for a number of reasons. We are dealing with a generation that has been brought up with, and has practised, thrift. Those people do not like the idea of going into debt. They do not accept the hire purchase arrangements that younger sections of the community regard as automatic. They would much prefer to be cold and uncomfortable—indeed to put their health at risk—than run into debt.
  It is also the generation that was probably brought up on the premise of "cold stable, healthy horse". That is all very well when one is young, but if the habit persists into advanced years, as is so often the case, it can do considerable damage. That sort of case leads to the sad deaths caused by hypothermia. They are particularly vulnerable sections of the community.
  Perhaps we need not be so concerned if the phenomenon were a passing one, but expensive fuel is here to stay. The day of minimal fuel costs is past. It is no longer adequate to take fuel bills into account only in the annual review of pensions and other benefits. The Government recognise that fact, and the Labour Government began to recognise it, too. The Government have substantially improved the available fuel schemes. The automatic addition for fuel costs for people on supplementary benefit over the age of 70 or where there is a child in the household under the age of 5 is to be welcomed, as are the arrangements for the severely disabled. The Government have also recently publicised the fact that single payments can be made in the event of severe weather, such as we have had recently. Those are all steps in the right direction, but they do not go far enough.
  Even the improved arrangements cover only a small number of people on supplementary benefit. The total of £250 million a year involved is substantial, but it covers only 2¼ million people. I am increasingly concerned about the growing number of people who are just above the supplementary benefit level or just in the tax net. They may have been thrifty and saved and in many cases may own their homes. They, too, find it difficult to make ends

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  meet. They may become disillusioned and bitter when they compare their lot with people on supplementary benefit or with younger people, whom they believe find it all too easy to get State help. All too often the thrift that they exercised during their working lives seems to attract penalties and not rewards. We must pay more attention to the people just above the margin.
  It would be bad for the country's moral fibre if it appeared that thrift, saving and hard work brought no reward while automatic supplementary benefits made life easier for others. I do not deny that people in receipt of supplementary benefit have the greatest need, but we are reaching the stage where the distinction between people in receipt of the assistance and those who are not is becoming far wider than the difference in their circumstances warrants.
  Mr. WinnickIs not one injustice the fact that a person who has savings of £2, 000 cannot claim supplementary benefit, whereas if that person did not have such savings and was in receipt of supplementary benefit, he would also get assistance in the winter months?
  Mr. DeanThat is one problem. A line has to be drawn somewhere for receipt of supplementary benefit, but we need more flexibility when dealing with the special supplement for fuel costs.
  The problem is not only with fuel costs. The people to whom I am referring feel that they are missing out all along the line. People just within the tax bracket have suffered more than perhaps any other sector of the community beause my right hon. and learned Friend the Chancellor of the Exchequer could not increase personal allowances last year. Everyone is affected by that. Pensioners may find that, as a result of the additional tax liability, the increase in their State or occupational pension has all too often been substantially reduced if not cancelled out entirely. The sections of the community about whom I am speaking always lose when personal allowances are not increased.
  Perhaps the classic example is rates. The widow living in the family home, but just above the margin to get assistance, finds that a substantial and ever-growing proportion of her income is spent on rates. People in local authority homes also pay only 5p for their television licences. The people about whom I am speaking must ponder that. Those are only some examples of how they feel that they lose. In addition, with the recent severe weather conditions they will have higher fuel bills but no increase in their income.
  I hope that the Government will seriously consider a wider spread of the available help, although that may mean that it will be spread more thinly, as resources are limited. Let me mention four possible ways to give additional help, some of which have already been referred to. I welcome the fact that improvements are being considered—and are likely to be introduced soon—to the code of practice on gas and electricity disconnections. It could be of considerable help to people in a vulnerable position. Improvements in the regular payment arrangements through budget accounts, the fuel direct scheme, prepayment meters and so on, could also assist some of the people about whom I am speaking.
  Many people just above the margin also often live in the old family home. The insulation arrangements of
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  recent years are welcome, but I hope that the Government will consider extending them to cover wider categories of people.
  Referring back to my point about the old old, a previous Government introduced an additional pension of 25p when people reach the age of 80. I regret that the differential has not been built on, as it could be a way to give more assistance to particular categories of people. The hon. Member for Walsall, North (Mr. Winnick) mentioned people on rent or rate rebates, and we might try to introduce some help for that category.
  In conclusion, I welcome the Government's improvements in recent years in difficult economic circumstances, but the experience of this winter has shown that the present arrangements are not adequate; they do not cover a sufficiently wide section of the community and they should be improved and widened as soon as resources become available.
  5.10 pm
  Mr. Norman AtkinsonThe hon. Member for Somerset, North (Mr. Paul Dean) was right when he referred to the group of people, particularly pensioners, just above supplementary benefit level. Those who have paid into pension schemes all their lives—railwaymen are a good example; they have paid £7 or £8 a week—receive pensions on top of the national pension, taking them out of national benefits. They suffer particularly when temperatures fall below zero, as they have recently. However, those people suffer that problem all year round because, as the hon. Gentleman mentioned, they fall out of schemes throughout the year.
  I accept that attention has been drawn to the plight of elderly people during the severe cold weather, but there is a continuing problem which hon. Members often fail to recognise. Indeed, many authorities also fail to recognise the severe hardship suffered by people because of the fuel problem.
  I am sure that many hon. Members, when visiting their constituents over Christmas and the new year, were horrified to find the abject poverty that they suffer, at a time when we are supposed to have an abundance of energy supplies. Britain is now the world's wealthiest nation, bar none, in terms of energy.
  Engineers and physicists have given us the possibility of North Sea oil. However, the energy consumed by the average household has gone down over the years and not up. It is not a question of how much money is being paid. The number of therms consumed by the average household is being reduced because of the allowances now made.
  When one looks around a constituency, one sees the pathetically low standards that people are suffering in the so-called "modern age". In 1978 my right hon. Friend the Member for Bristol, South-East (Mr. Benn), then Secretary of State for Energy, argued—indeed, the case was published in Green Papers and various other Government documents—that every household should have adequate lighting and heating. When the 1978 projections are reflected on and brought up to date, one can see that we are further than ever from that objective, despite the potential to which I have referred.
  What can we do about the present situation and what do we demand from the Government? It is not generally understood just how little heating is purchased for every £1 paid. The realisation of what households can afford seems to be missing.

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  I recently read reports written by experts. They lay down what they call "minimum standards"—not luxury standards. For example, in a very small home, with 600 sq ft of floor space, and the average insulation of a council house, an ambient temperature of 40 degrees would require 4kw per hour for 15 hours a day. That would just lift conditions in a household to a reasonable standard. As I said, it would be nothing luxurious.
  The domestic rate for electricity in London, is 5.02p per kilowatt. Therefore, for the recommended 4 kw—being the minimum--the cost is about 20p per hour or £3 a day. Households of the sort that we are talking about are a long way from that. They do not get such an income. They are asked to find £3 a day for fuel to exist at a reasonable level. That is how poverty-stricken we are.
  We are divorced from reality when talking about fuel conditions. The experts say that the average household wants another 5kw for some cooking and lighting. That amounts to 25p a day at the London electricity board rates and means a weekly winter cost of £22·75—double the average rent payment. The key is the relationship between winter fuel bills, average rents and the amount paid in rates.
  When the Supplementary Benefits Commission and others put their heads together to see how they can assist those on minimum income levels, they start talking about figures very different from those that I have given. Indeed, they have already said that a couple living on £50 a week total income and paying £10 a week rent, excluding rates and other items, are entitled to a rebate of £6·42 because they cannot afford to pay that sort of rent out of the £50.
  If a family cannot afford to pay that sort of rent and need the £10 a week rent rebated by £6·42, it is utter nonsense to talk about minimum heating standards, some lighting and a bit of cooking costing a family £22·75 a week. That is out of the question. Yet, if they are not in receipt of some supplementary assistance, they can turn to no one for help. They have to shuffle up into a corner, wrap themselves in newspaper or blankets and exist in darkness except, perhaps, for the glimmer from a television set. They cannot afford to have the television and a light or some heating at the same time. They wrap themselves in anything, simply to exist. My God, what sort of state are we in?
  What sort of modern world is this? The standards I refer to are no more than abject poverty and it is an utter condemnation of every politician who claims to do something for his constituents when the contradictions are so extraordinary and when we talk about rent levels against the average fuel bills, or what the experts say must be the minimum standards. Too many hon. Members wish to speak for me to quote from the experts' other reports.
  It was suggested earlier that some elderly people are frightened of getting into debt. The truth is that they are frightened of having their electricity supply disconnected. The LEB appears to threaten to disconnect a supply when the debt reaches about £100. That will buy only 2, 000 units of electricity, which will not keep anyone warm for long, according to the standards set out in the experts' reports. Elderly people are frightened, not of getting into debt, but of having their electricity supply cut off. They have no one to turn to and they cannot be helped.
  About 3, 100, 000 people receive rate rebates and we need to devise a method of helping them. It is not beyond the wit of Governments to recognise their needs and to help through a system of rebates. I understand the
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  problems involved in across-the-board reductions in fuel costs, but we must do something for those in the most urgent need.
  I have already suggested to the Secretary of State that something could be done by way of a national rebate scheme for energy. We help people with rent and rate rebates, and we could issue tables, similar to those used for rent and rate rebates, setting out the rebates of energy bills, according to a person's income. That would help those in most need. The numbers receiving rent rebates is lower, because about 1·4 million owner-occupiers are not included.
  In October 1980, the latest date for which figures are available, the average rent rebate was £4·55 a week. That £200 a year would go a long way to help people to increase their energy consumption to something like a reasonable level. We could help those who are just above the supplementary benefit level. It would cost about £250 million a year to do something for fuel consumers, and that would make a world of difference to those who depend upon additional allowances.
  Mr. Albert RobertsThere would be many anomalies if we allowed rebates. The Government, like their predecessors, believe in conserving energy by making the price prohibitive. That is at the base of the problems of industry and domestic consumers. Our energy policy is wrong. We have an abundance of energy and we should not be made to conserve through price control.
  Mr. AtkinsonI agree that we should break from rationing by price, which has always affected those whom Labour Members represent. That has always hit the poorest sections of the community, and the principle is wrong.
  We do not say that the 3 million to whom I have referred should be denied minimum standards. We must devise a way to allow them to lift their standards to the minimum level recommended in the experts' reports. They are entitled to our support and the motion is directed towards them.
  I hope that every hon. Member will give a clear message to the Government that we want assistance to be given to those most in need so that they can have minimum standards of heating. We should reject the amendment and get on with devising a scheme to bring help quickly lo those in the greatest need.
  5.25 pm
  Mr. Michael MorrisThe hon. Member for Tottenham (Mr. Atkinson) did the House a service in the earlier part of his speech when he emphasised that it is incumbent upon us to find a method of allowing the sections of the community to which he referred to live a reasonable life in normal conditions, let alone in the sort of severe winter that we have experienced this year.
  Every hon. Member probably recognises the problem, but we have to recognise that it must be put in the context of what is happening to fuel costs generally. One of the peculiar characteristics of this country is that until recently costs to industry were higher than those to domestic consumers. That has not happened anywhere else in the world, and my right hon. Friend the Secretary of State has taken some correct decisions in that area. Logically, industrial users should pay less than domestic consumers. That should not be forgotten in the debate.

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  I welcome the debate, and the important question to be answered is whether the Government's policies are attuned to the needs of those in most difficulty. I suggest that the present scheme, which is 30 per cent. better than when we came into office, goes a fair way towards meeting the needs of the over-70s on supplementary benefit and the families on supplementary benefit who have a child under five.
  However, the scheme does not suffice in all areas. I have the privilege of representing a new town, and in new towns there are many younger married couples and, alas, too many single-parent families. The problem there is not so much the surge of costs in the winter as the cash flow difficulties of some families and the old policy of electricity and gas boards to rush in to disconnect supplies.
  Until about six months ago, an individual seeking help in phasing energy payments had to go on bended knee to get a prepayment meter from the electricity or gas board. I welcome the steps taken by my right hon. Friend to improve the code of practice. I understand that its implementation is to be brought forward and that there will be a much more flexible approach to disconnection and the provision of prepayment meters. There is the problem of the 3 million who are on rent or rate rebate, which cannot simply be landed in the laps of Ministers. We must consider the tariff policies of both the electricity and the gas boards. Although it may be unfortunate to refer to it this afternoon, British Rail, within its tariff structure, has devised schemes for the elderly which are extensively used. Credit should go to British Rail and the way in which it has implemented its special schemes for pensioners, families with children and others.
  It should not be beyond the wit of the electricity and gas boards to have a long hard look at their tariff structures. They have not yet done that. There was the report when the Monopolies and Mergers Commission examined the CEGB, but there has been no investigation of any of the area electricity boards. I do not speak with any authority on the East Midlands electricity board, but I know from my conversations with the management of the board that it would welcome greater flexibility.
  I do not represent a London constituency, but when I read that the London electricity board lost £5 million last year on running its electrical appliance shops I have to ask what that board is doing. Where are its priorities? The message that my right hon. Friend the Minister for Consumer Affairs can take from this debate is that the Government should have some hard discussions with both the electricity and gas industries, to ensure that some real work is done on tariff restructuring. That may mean that those of us who are able-bodied and in work must accept a marginal increase in the price per therm that we pay. There should be more flexibility. That may involve the Government giving some extra help to put the scheme on its way, such as a reduced requirement on the financial return from the industries.
  When one electricity board loses £5 million, one wonders how many other boards have lost money in the previous year. I do not know whether any other hon. Member knows the answer. On reading the annual reports from British Gas, the CEGB and the area boards, one is pushed to find the true cost of some of the exercises they are carrying out. I know that I make this plea almost ad nauseam, but I hope that the Public Accounts
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  Committee—where I should now be—will be used as the means whereby the House can and should investigate what is done in our nationalised industries.
  5.33 pm
  Mr. Andrew F. BennettAll my constituents will be disappointed by the Minister's reply, because they were hoping that the Government would give some positive help with their fuel bill problems. The Minister offered little, except to say that fairly soon the Government would produce an improved code of practice.
  The mark of a civilised society is the amount of freedom that it allows to its citizens. Freedom from fear must be one of the most important. Sadly, all those on low incomes, whether in work, on State pensions, unemployed or on sickness, supplementary or disabled benefit, always live with the fear that some disaster or problem will occur for which they cannot afford to pay. Such a disaster was the very cold spell just before and just after Christmas. It is worth remembering that the winter of 1947, to which people often refer, started only in the last week of January, so it is possible that we have more cold weather to come.
  Our most important priority is to ensure that we raise the income of those on low pay, the pensioners, the sick, the disabled and the unemployed, to a decent level. This would mean that they would not always have to live with the fear of poverty and the problems that result from it. They would not have to fear turning up the heat, putting on the gas or the electricity, and that they could afford adequate heating even in the coldest of weather. That is a question of raising their income to a decent level. It is all very well to talk of discounts, for example, but the basic problem is that those people do not have enough money. That is what we must consider.
  Of necessity, the motion puts forward what are little more than palliatives. What the Labour Party want is a direct income for those who are now on low incomes. However, in addition to the palliatives we must send a firm message to the gas and electricity boards to stop penalising the poor. Standing charges, for example, are one of the meanest policies of the gas and electricity boards. It is a penalty imposed by the gas board on those who use electricity, and by the electricity board on those who use gas. Standing charges hit small consumers very hard. The boards claim that they have costs which they have to recoup from those using little fuel, such as reading the meters and connections. However, standing charges do not reflect any real cost that the boards can detail. It is a subsidy from the poor to the rich.
  I can give the example of one of my constituents who wrote to me last week. He lives in a purpose-built old people's flat. The flat comes, more or less, down to the road, so that the length of cables and pipes used by the gas and electricity boards is probably less than a yard. My constituent has the new types of meter by the front door. They have glass panels so that the gas and electricity meter readers can read them without knocking on the door. Therefore, the connections and the ability to read the meters mean that the boards incur few costs in supplying this consumer. What is more, he pays his bill as soon as the demand comes, because he prides himself that he has the money to pay, so there is no second demand.
  My constituent's son lives in a fairly nice, prosperous house with a long drive. The meter man has a long walk and there are long lengths of pipe and cable. Very often, when the meter man comes the son and his family are out,

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  and even when they are in, the meter man has to go in through the front door, down the hall, down the cellar steps and into the far dark corner of the basement to read the meter. Also, the son makes it a principle never to pay until the red bill comes. He thinks that the electricity board can wait because it is more worth while for him to have the money in his bank. Despite that, the two households pay exactly the same standing charges. How can the gas and electricity boards justify that? One of my examples maximises the costs, the other minimises them, but the boards make the same standing charges.
  The boards should either work out the real costs of the fixed expenses for each consumer and charge on that basis, or standing charges should be abolished. The boards will say that it is far too expensive to work out actual charges, and of course it is. Therefore, we should get rid of standing charges and put a minor increase on charges to stop that penalty.
  The boards tell us how much prepayment stamps help the low-paid, and pensioners, but it is the boards that benefit most from them, because they get the money in early. Some pensioners in my constituency were buying stamps in the summer to meet their winter bills. Everyone who uses stamps has, of course, bought them before receiving his bill and has provided the boards with money well in advance. It is no wonder that the boards are keen to push the sale of stamps. If the boards want to help the low-paid, they should sell the stamps at a slight discount. That would encourage consumers to use them and it would be fair to those on low incomes.
  In the 1960s and early 1970s, when we had low fuel costs, the boards ripped out prepayment meters with great enthusiasm. That was a tragedy. They have shown a great reluctance to replace them. When they were threatened that if they did not respond they might lose the right to disconnect, they began gradually to replace prepayment meters. They were reluctant to do so until that stage was reached.
  In the North-West there are about 200 meters that take plastic tokens that destruct as they pass through the meters. There is no chance that the meters will be robbed. The boards can overcome the problem. The risk of robbery was always one of the boards' excuses for not replacing prepayment meters.
  The Minister should insist that anyone who asks a gas or electricity board for a prepayment meter has the right to have one installed immediately. Those who make that request should not have to show that they have problems in meeting their bills.
  I am disgusted by the number of occasions when the boards, especially the gas board in the North-West, demand deposits before they will reconnect. Sometimes consumers have struggled for months to pay off debts with a view to being reconnected. They clear the debt and then the boards say "We want a reconnection charge and a deposit." That seems to be grossly unfair. If I or social workers complain to the gas boards, they immediately remove that charge. The charges are not essential, but they are one of the penalties imposed on low-income families, which have the most problems.
  I have been told repeatedly by the boards that if they did not have powers to disconnect they would find their fuel debts ever increasing. As a result of parliamentary pressure, including pressure from both Labour and Conservative Ministers, the boards have gradually reduced the number of disconnections. That has not resulted in a
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  mushrooming of fuel debts. When all the factors are taken into account it seems that problem has not worsened very much. The fact that people do not use the fuel that they need is probably a worse problem. Surely, we could make much more progress in stopping disconnections by making it a much more complicated process for the boards. When they are told that they have to stop, they manage to find other ways in which to get their money.
  The sad feature for my constituents, especially for those who are unemployed, is that when they cannot afford adequate heating at home they find it increasingly difficult to find warm public buildings to which they can go. There are local authority cuts, and as a result the opportunities to visit local libraries or to use sports and recreational facilities are cut. Those on low incomes cannot escape the coldness of their own homes by visiting warmer public places. In Stockport the parks department has complained about the amount of fencing that it is losing, because people are taking it to burn on their fires to keep themselves warm.
  The Government must provide extra money. They must give the amount that they did not provide in increased pensions and supplementary benefit in the autumn. I refer to the one week of benefit that they have denied to all those who are eligible to receive it. The Government must give them that as quickly as possible. They must give something to those who are out of work, and especially to those on rent and rate rebates. We must have no standing charges imposed by the gas and electricity boards. We must establish a clear policy of installing prepayment meters. There must be no reconnection deposits. There must be much more vigour from local authorities in securing sufficient money for home insulation grants. Half way through last year many authorities ran out of funds for making such grants. I hope that the Government will ensure that no authorities run out of funds this year.
  If we want to call ourselves a free and democratic society, we must take away from people the fear of poverty and the fear of going cold because they cannot afford to keep warm.
  Mr. Deputy Speaker (Mr. Ernest Armstrong)I remind the House that six hon. Members are trying to catch my eye and that the first of the Front Bench spokesmen hopes to catch my eye at about half-past six. The time at which the Front Bench speeches begin is a matter for the House to decide.
  5.46 pm
  Mr. John HannamThis sort of debate is extremely useful, as it allows hon. Members to advance many ideas to meet a problem that is acknowledged by everyone. Ministers have the opportunity to consider hon. Members' ideas and to examine them with a view to taking them up at some stage.
  The hon. Member for Stockport, North (Mr. Bennett) talked about standing charges. Meter reading must contribute a substantial amount to the standing costs of gas and electricity boards. It seems crazy that separate meter readers are still toddling up drives to carry out a simple operation that should be rationalised sufficiently so that one reader for each area is able to do it. We talk about the issue year after year, but nothing seems to be done. That is a matter that should be pursued.
  Some claim that there is an abundant supply of energy and that rationing is taking place through pricing. It is

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  wrong to suggest that we have a vast surplus of gas. In fact, we have been short of gas and industry has been deprived of it. The reason for that lies largely in the imbalance in the pricing of gas for the domestic consumer and the industrial consumer and the consequent imbalance of consumer demand. The Government are right to try to get a pricing balance.
  I can speak with deep feeling about the effects of this winter's weather. On 13 December a freezing blizzard swept through Devon and Cornwall and struck the area where I live, wiping out electricity supplies for five or six days and causing my oil-fired boiler not to switch on when it should have done, the time switch having been duly set in my absence. That resulted in five burst pipes in the roof and thousands of pounds worth of damage throughout the house.
  There is a lesson to be learnt from that, which should be made public. However hard we try to plan for absences from home, and although we may arrange for time switches or frost-stats to switch on our boilers, if electricity supplies are cut off through storm and tempest, and if cables are knocked down, no heating will come on unless it is supplied by gas. Therefore, we cannot rely on an emergency system that we think has been carefully worked out.
  If it is necessary to leave our properties—it is necessary for hon. Members to travel to Westminster and families may, for example, decide to go away at Christmas—we must ensure that water supplies are turned off if we are to avoid the sort of damage that was inflicted upon my house.
  We have been advising everyone to lay levels of insulation material throughout roofs and directly above ceilings, and we have dutifully carried that out. Many people have received grants so to do. We have duly lowered the temperature in the roof space by about 10 degrees, thereby causing pipes to freeze when hitherto houses had a flow of warm air passing into the roof spaces, which prevented bursts from taking place.
  I have spoken to a number of builders who have been involved in emergency operations in recent weeks. They have all stated that insulation has been the major cause of burst pipes and damage in houses. We are rightly encouraging the public to conserve energy by laying insulation material in their roofs, and we are even advising them to instal frost-stats for example, but a leaking pipe that is caused by a burst is not discovered quickly—hitherto the water would have dripped through the plaster and on to the bed of the person below—because the water soaks into the insulation material for hours, which leads to the accumulation of a considerable weight of water, which brings down the ceiling.
  We must advise people to ensure that the roof eaves are insulated in some way or that there is protection for the pipes under the roof. Older houses that are properly built contain eaves insulation, but many others, including my house, do not. It is more sensible to put lightweight thermal boarding along the eaves in the roof space as insulation rather than lay 4 in. to 6 in. of fibreglass material. I speak from experience. My house has been damaged on two occasions. If a 70-mile-an-hour freezing wind blows through the roof tiles and through an unheated roof space, the insulated, lagged pipes freeze up, as mine
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  did. I ask my hon. Friend the Minister to take that important point on board, because it has come home to me and many others during the severe weather.
  The Opposition motion calls for a three-month moratorium on disconnections and substantial financial help for all those receiving State benefits and rebates. That would represent a vast expenditure and could only result in higher fuel charges. I do not agree with those remedies although I believe that some of the suggestions for dealing with those on rebates should be carefully examined. My hon. Friend the Member for Northampton, South (Mr. Morris) suggested that that should be considered.
  In this exceptional winter, there is no doubt that some extra help is required for the disadvantaged in our society. I am pleased that we have seen a willingness on the part of the Government to provide that extra help through the measures that have been introduced. There is the automatic protection for families with people who are over 70 or under 5 by the basic heating addition and the supplementary benefit heating addition in November. Those add up to and appreciation of the difficulties faced by poorer families.
  The voluntary code of practice has been discussed. In the last 12 months the relationship between local electricity and gas offices dealing with non-payment and disconnection and the DHSS has improved considerably. The only major problem about which I have heard concerned the cutting off of water supplies. It appears that there is no provision, through the DHSS, for paying towards the payment of water charges through supplementary benefit. However, that is another matter.
  Although I support the Government's action in helping with heating problems, I draw attention to the problems faced by the disabled consumer. We all know that, in general, disabled families have lower than average incomes and require above average heating levels, because of their handicaps and disabilities. Therefore, it comes as no surprise to learn from a recent Disablement Income Group study by Richard Stowell that 45 per cent. of disabled people on supplementary benefit regard heating costs as a major problem.
  There are a number of reasons for disabled people's extra fuel costs. First, some disabilities, especially those that limit mobility, predispose people to feel the cold more than others, so that a higher level of heating is required. In many cases heating is required in the summer months as well as in the winter.
  Secondly, people with disabilities may have to heat more rooms for longer periods. For example, they are more likely to be at home all day, and they may need more heating in the bathroom and the bedroom because routine tasks such as washing and dressing take longer.
  Thirdly, disabled people may be more dependent on electrical appliances, with a consequent increase in fuel use. For example, incontinence will increase considerably the use of water heaters, washing machines and driers.
  Fourthly, with a lower than average income, few disabled people can afford the installation costs of the most cost effective forms of heating, nor can they easily afford adequate insulation, which would enable them to use their heating more efficiently. Low income inhibits saving, which means that people with disabilities often have no resources with which to meet the crisis that an unexpectedly high fuel bill represents, as in recent months.
  In 1979 the average spending on fuel by households with income from disability benefits was significantly

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  higher, at £5·23 per week, than the average of £4·76 a week for all households. Higher fuel expenditure is found for all types and sizes of accommodation for disabled people. In 1979 the average fuel expenditure was 7·5 per cent. of total income for households with some income from disability benefits, compared with 6·9 per cent. of total income for general households. The Disablement Income Group survey showed that a quarter of the sample of disabled people on supplementary benefit spent more than a third of their income on fuel. About 15 per cent. of that sample said that they were often without heating. We must agree that that is a high and disconcerting figure, given the need for heat for those suffering from many disabilities.
  Since December 1980 the fuel industries' code of practice has offered extra help to people with disabilities, but the recent review of the working of the code shows that it has not offered adequate protection against disconnection. One third of those in the Policy Studies Institute survey who had their electricity disconnected said that a member of their family had a long-term sickness or disability or had had a serious accident or illness recently. About 7 per cent. were registered disabled. Those with some sickness or disability did not obtain reconnection quicker or slower than other customers.
  I ask my hon. Friend the Minister to give as much help as possible to disabled consumers because of their problems with extra heating costs in their homes. They also need extra equipment so that they can pursue a normal life. That shows conclusively that they face particular difficulties during extreme weather conditions, such as in the last month or two. I hope that my hon. Friend will take those factors into consideration when working out what extra help can be given for the costs that those people have to bear during such crisis periods. The Government have done a great deal already. They have helped the handicapped and the disabled with their heating costs, but a great deal more help would be appreciated.
  5.58 pm
  Mr. John MaxtonI should like to make a small point about the remarks made by the hon. Member for Exeter (Mr. Hannam). In Scotland it is standard practice that roofs are lined with some sort of insulation, yet my pipes froze in my attic. Therefore, I do not know whether the hon. Gentleman had the answer to the problem.
  I welcome what the Minister said about abolishing the concept of a limit on fuel debts, a level above which the fuel boards will not allow direct payment from the Department of Health and Social Security. The South of Scotland Electricity Board has been operating a policy of allowing a debt of £150 in the last two years. If the debt was above that, the customer was refused direct payment and disconnection followed. That is the lowest debt allowed by any board in the country.
  It is worth pointing out that the board said last summer that it was prepared to abolish that limit if the Government were prepared to allow large numbers of households to be all-electric. That is so in my constituency and that of my hon. Friend the Member for Glasgow, Provan (Mr. Brown). The DHSS regulations state that sums of £1.10 can be deducted and paid direct to the electricity and gas boards. What there cannot be with all-electric housing is a deduction of £2.20 for the electricity payment. The SSEB has said that if the Government are prepared to
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  allow that, it will raise its limitation considerably. Indeed, in view of what the Government have said, I am sure that it will be prepared to abolish its upper limitation completely.
  Although the SSEB bears some responsibility for setting such a low limit, the imposition followed directly from Government action in changing the regulations on supplementary payments so that fuel debts could not receive a special needs payment except in the most exceptional circumstances. The SSEB decided to impose that limitation following that change. Until then, it did not impose such a limit on its customers' debts because it knew that in a large number of cases the DHSS would make a supplementary payment, a special needs payment and then a direct payment, which would mean that the SSEB would get its money. I hope that the Minister will explain more fully what has been going on in relation to the SSEB.
  I wish that Ministers with responsibilities in Scotland would recognise that Scotland is colder for longer than the rest of the United Kingdom. Although the West of Scotland did not suffer the heavy snowfalls that were suffered in Wales and other parts of the United Kingdom, the lowest temperatures recorded during the cold spell were in Scotland. To some extent, therefore, we have a harsher problem than many other areas and we suffer it more often and for longer. One can generally say that in Glasgow we turn our heating on earlier in the winter and turn it off later and therefore tend to have higher fuel bills. Unfortunately, the DHSS and to some extent the Scottish Office do not recognise this fact and fail to take it into account in making rules and regulations concernng the payment of electricity bills.
  Mr. Norman AtkinsonYou are getting soft.
  Mr. MaxtonMy hon. Friend says that we are getting soft. That is not so, but I have many constituents who are old and who have suffered considerably during the past few months as a result of the extreme climatic conditions. They have suffered more than they might otherwise have suffered because, as my hon. Friend the Member for Stockport, North (Mr. Bennett) said, the problem is not merely about high electricity bills. It is not just the fact that many old people are afraid to turn their electric heaters up and to keep them on for long periods. Government cuts and other measures have made the position worse.
  The hon. Member for Fife, East (Mr. Henderson) described the problem in terms of increasing pension and supplementary benefits and asked whether fuel costs were sufficiently taken into account in the price index. I would say that, in the sense in which he means it, they are not. It is the price index that is wrong. We need a separate price index against which to set pensions and supplementary benefits, which takes into account the rises in the cost of living related to the needs of those who are poorest. That would be a totally different index from that which applies to the rest of us who are better off. Fuel, rents and rates have all increased much faster than the cost of living. Those are three basic elements of poorer people's budgets, so the cost of living is much higher and has risen more quickly for them than for the rest of us. That is one element that should be taken into account, but there are others A small example is the cuts in the money available to local authorities to spend on housing repairs. In Glasgow, we have faced enormous problems in the numbers of burst

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  pipes and the damage that has been caused to council property as a result. It will take some time for all those pipes to be repaired. Presumably the local authority has to pay compensation for damaged furniture, carpets, curtains, and so one. If local authorities do that will the Government ensure that they receive all the necessary money? If the Government do not do that, the tenants will find themselves even harder hit because the money for normal repairs will not be available.
  Everyone talks about the higher fuel bills that result from the cold weather, and that is true, but if one has had a burst pipe extra fuel costs will be incurred as heating will have to be put on to ensure that the house is dried out as much as possible.
  Mr. Albert McQuarrieThe hon. Gentleman refers to burst pipes in council houses. Can he tell us whether Glasgow corporation insures itself against these things? Does it take out a policy with an insurance company, as any private individual would, so that the damage can be reclaimed from the insurance company?
  Mr. MaxtonUnlike many hon. Members, I shall simply confess ignorance. I cannot answer the hon. Gentleman's question, but I am certainly prepared to find out and to discuss the matter with him at a later date.
  There is a continuing dampness problem in Glasgow, in that many people in council housing are trapped in a situation for which there seems to be no solution. To reduce the dampness they must increase the heating, which leads to higher bills that they cannot afford to pay, so they then have to reduce the heating, which means that the dampness increases.
  The Government must ensure that money is made available to pay poorer people's heating bills and ensure that for the rest of the period no more people suffer as a result of further cold spells because, despite what the Minister has said, the winter is not yet over.
  6.8 pm
  Mr. Mike ThomasI shall not follow the hon. Member for Glasgow, Cathcart (Mr. Maxton), save to say that we in the bleak North-East of England envy the climate of the balmy West of Scotland.
  Today's debate will do nothing for those who are seriously affected by the issues before us if we discuss the problem as part of the old "kettle calling the pot black" form of politics, although I am glad to acquit Back Bench contributors of that charge. This is a complicated problem which is not susceptible either to the opportunist Labour Supply day motion, which calls for measures that Labour Members would never have implemented if they were in office, nor to the complacent Government amendment. A number of interrelated problems arise. The sum total of successive Governments' actions in this area shows that neither the Labour Government nor the Conservative Government have been all good or all bad, and it is stupid and disrespectful to those suffering from these problems to pretend that either is the case.
  There is no doubt that the very large increase in energy prices has caused and will continue to cause substantial hardship. The Select Committee on Nationalised Industries considered the problem in 1975–76 before it had
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  its current sex appeal and made recommendations on the major problems before us. As a then member of the Select Committee and a then supporter of the Labour Government, I must say that the Labour Government's response was less than comprehensively good, even though the right hon. Member for Bristol, South-East (Mr. Benn) was then Secretary of State for Energy.
  On disconnections, the Select Committee made it clear that unless steps could be taken to ensure that electricity and gas boards behaved in a more socially responsible fashion other measures would have to be taken to restrain them.
  Indeed, the Labour Government issued the code of practice, which I believe was improved a year later. There is now an excellent and full report from Richard Berthoud of the PSI. It is no use Labour Members feeling indignant about it—the scheme did not work perfectly under Labour. I was among those who raised the problems involved. The scheme does not work perfectly now. That might say more about the electricity and gas boards than about either of the old political parties.
  The PSI recommendations should be implemented by the Government. However, from the report we can see how complicated the problem is. I believe that a three-month moratorium on disconnections is a gimmick which is unworthy of the official Opposition. One solution posed by the PSI is the greater use and, in some cases, the compulsory installation of pre-payment meters. The Select Committee examined that and made a similar recommendation. Neither Government have done much about it. The administrative convenience of the boards has prevailed.
  I accept that the installation of pre-payment meters is up by 50 per cent., as the Minister said, but the absolute figures are still low. I believe that the figures have risen from about five pre-payment meters per thousand to six or seven per thousand in the years since the proposal was made. It is about time that the Government—and they happen to be a Conservative Government—started to lean on the electricity and gas boards to do the job and to do it properly. They should not approach the problem in the faint-hearted way that Governments have in the past.
  The Select Committee anticipated developments in social security and made four recommendations. Two of them—the development of the "fuel direct" schemes and special consideration for tenants in "no-choice" electrically-heated accommodation—have been the subject of considerable progress. Two others—incorporating the lowest rate of heating addition into the scale rates and dealing with people who did not qualify for heating payments, in particular the low-paid—have a less satisfactory outcome.
  It took us 12 months to persuade the Labour Government to include rate and rent rebate recipients in the electricity discount scheme. It is depressing that the present Government have taken us back to square one. In that respect I agree with the spirit of the Labour motion. The refusal by the Government to deal with that group, which all sides agree to be poor and in need, and which is not dealt with by the present scheme, substantially undermines the credit that the Government might claim for improving their own scheme—by reducing the qualifying age, for example—since they came to office.
  Because of the Government's record in being so mean in their instructions and practice in relation to the exceptional needs payments I have grave doubts whether

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  the Secretary of State's 14 January circular will receive the response that it deserves. How much do the Government expect to spend on such payments? We should like to know exactly what the payments will be worth in real terms. May we have an assurance that we shall be informed about the take-up figures following the announcement and the measures that are being taken to publicise the announcement?
  The Government should tell us what progress has been made since the Secretary of State, on 27 March 1980, said that
  "Ministers are…launching an urgent study into ways of helping the old and disabled to save fuel, by insulating their homes, by draft proofing and by making better use of heating appliances. Such a scheme could involve the voluntary bodies and could use younger unemployed people under existing Manpower Services Commission powers."—[Official Report, 27 March 1980; Vol. 981, c. 1662.]
  We have had bits and pieces. There has been the extension of the 90 per cent. rate of grant for home insulation for the severely disabled. There has been an extension of supplementary benefit single payments to cover hot water cylinder jackets and the Department of Energy and Manpower Services Commission grant towards neighbourhood programmes run in association with voluntary bodies, to which the Minister referred as an afterthought.
  When we are experiencing unemployment problems and heating and health problems on their present scale, for the Government to say that two years on only 400 young people are assisting in schemes of this kind is proof that little has been done. I cannot understand why. It is not only a question of the needs of those involved, but of energy conservation and unemployment. The Government should proceed more speedily and determinedly.
  The trading of who did what in office expressed in the two Front-Bench speeches solves none of the problems caused by the energy price escalation and the current winter to many families. A straightforward commitment by the Government to implement the recommendations in the PSI report—and I am glad that the consultation is not to be dragged out too long—coupled with a real effort to make progress on the broad front on the part of the electricity and gas boards is the way to proceed. Party political debating points from either Front Bench will achieve nothing.
  In the light of the Front Bench speeches today I shall find it hard to persuade my right hon. and hon. Friends that either the Labour motion or the Government amendment deserve their support tonight.
  6.15 pm
  Mr. A. W. StallardI congratulate my right hon. and hon. Friends who had the foresight to table the motion. I do not intend to follow the Minister's lead by parading a list of statistics about who did what. Pensioners and others in my constituency who are in trouble do not care two hoots about who did what in 1940, 1950 or 1960. They are bothered about what is happening now. I have made no calculations on the basis of who has performed better. My calculations are based on the problem.
  The debate takes place against the backcloth of the worst winter for many decades, of gas prices that have increased threefold since 1974, of coal prices that have gone up fourfold since 1974 and of electricity prices that have risen four and a half times. There has also been a massive increase in the number of people who have been
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  disconnected for more than one month. The increase is not only in the number of disconnections but in the length of the disconnections. Statistics prove that many people have been disconnected for more than one month. Between 1979 and 1981 the retail price index increased by 27·8 per cent. whereas, the fuel and light index increased by 49·3 per cent.
  The statistics do not lay the blame anywhere but they state facts. I shall try to rush my speech so that others can take part. The Secretary of State recently announced further help for people on supplementary benefit. Any such help is to be welcomed. It has been possible to claim a single payment before. The scheme is not new for people on supplementary benefit, but the Government are ignoring the 2 million or more people who do not receive supplementary benefit. Over 2 million pensioners receive rent and rate rebates. They are sometimes worse off than people on supplementary benefit. They receive no help from the scheme.
  A recent article by Ruth Lister, director of the Child Poverty Action Group, puts the point more succinctly than I can in the time available. The article states:
  "On the income side, much has been made of the 'special package' of measures to help with fuel costs, now worth £250m, to replace the electricity discount scheme. However, closer examination suggests that only about £60m is actually new money; the rest would have been spent anyway on existing SB claimants. Furthermore, the proportion of SB recipients who get a heating addition has remained constant since 1979 at ⅔rds, whilst the number of single payments for fuel have been cut back from 48, 000 in 1979 (value £1m+) to about 9, 500 in 1980 (value £639, 000).
  There is no help at all for low income groups not in receipt of SB. With increasing numbers of unemployed and decreasing value of benefits, given a £1·5 billion cut in the overall social security budget, more people are experiencing fuel poverty for the first time."
  That puts the matter excellently into context.
  If I had time, I could quote from an excellent document from Age Concern which pointed to the same type of predicament and the same statistics in relation to pensioners and their problems with heating allowances. There are many surveys and reports that hon. Members who are involved with the problem of pensioners and social security benefits have received in the last few weeks.
  Mention should be made of the national Right to Fuel campaign, which has been campaigning strongly for a comprehensive fuel policy ever since the early 1970s, and certainly during the period of the Labour Government. It states that 13 out of the 14 electricity boards in Great Britain are still disconnecting power from families in debt. Every day over 500 households are cut off because money is owed. Its figures show that a quarter of those are disconnected for more than a month. On any one day, 30, 000 households are without electricity because bills are unpaid. Those are massive figures. A report commissioned by the fuel industries shows similar statistics.
  While the measures announced by the Secretary of State will help some people, they will not be of much help to those who are already cut off or who are threatened with a cut-off.
  Representatives of the Right to Fuel campaign have written a fairly long letter to the Secretary of State
  "asking for an immediate end to the disconnection of gas and electicity from domestic premises for fuel debts and an urgent programme of reconnection for those already cut off. The objective should be to ensure that no home is without power because of a debt during this lethal cold."

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  The letter goes on to quote a precedent for such action. People have been searching for precedents. The letter continues:
  "During the firemen's strike five winters ago, more electricity boards suspended disconnections for its duration, to avoid adding to the risk of fire."
  There is no reason why a similar exercise could not be carried out again.
  If I had enough time, I would quote from the Electricity Consumer Council's report, which hon. Members have received today. I am truncating my speech; perhaps it will be massacred. I hope that we shall be able to return to this excellent report. I shall probably request a debate on it. One hon. Member has said that he was unaware that areas had been investigated. The Greater London citizens advice bureau service carried out such a survey throughout the London area. The House has missed an excellent resumé of that report because of the lack of time.
  On the matter of standing charges, I have made the case before in the Chamber and I shall continue to make it because I still consider that £3·25 a week for pensioners for standing charges is far too excessive and must be examined. I am sure that most hon. Members will agree with that.
  I support the entire motion. It is about time that the Government took the initiative away from the voluntary organisations and those of us who have campaigned, with very few resources, for a comprehensive fuel policy that would be easily understood and that would cover all fuels. Voluntary organisations cannot afford the type of surveys that need to be done. The Government should initiate urgently such a survey aimed at producing a comprehensive fuel policy that will prevent the horror stories that we shall hear during the next month or two, as conditions worsen and as bills get larger.
  6.24 pm
  Mr. George CunninghamI regret that I shall not be able to stay for the final speeches from the Front Benches because I have a meeting, not unrelated to this subject matter, in my constituency. However, I shall read the speeches carefully. I have three points to make.
  First, standing charges have been referred to by at least two hon. Members. They do not seem to realise that the problem, on standing charges on gas bills in particular, is as serious as it actually is. A decision of policy has been taken—not by the local gas boards but by the Gas Council, because this is a national matter—that the standing charge will be progressively raised until it covers all the fixed charges relating to the system, as against those charges which relate to the amount of gas used. When the Gas Council refers to the system, it does not mean the cost of reading the meter or the cost of bringing gas from the road to the house. It means the entire network. Therefore, it is the council's intention massively to increase progressively the standing charge.
  In the light of what has been said so far in the debate, I hope that a number of hon. Members will get together and see what can be done even at this late stage to try to halt that development. I hope that the Minister will take that on board.
  Secondly, last June or July I had a debate in the House about the extremely high charges levied by local
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  authorities for space heating and water heating. On the whole, council tenants pay about double or more for the same amount of space and hot water heating as other people who have individual control of their systems. During that debate, I begged the Minister representing the Department of the Environment who was replying to the debate to collect sample statistics from local authorities all over the country on the amounts charged to show how excessive the charges were in relation to the heat actually obtained for them.
  I am sorry to say that the Department of the Environment has not yet agreed to do that. Given the fact that we are all interested in energy conservation and that these excessive charges arise from wastage and inefficiency and not from making mistakes in the figures, I hope that the two Ministers from other Departments at present on the Front Bench will take this point on board and try to ensure that the Department of the Environment, which has a renewed request from me to this effect, will collect those sample statistics.
  Thirdly, last November, the rise in personal scale rates for supplementary benefit amounted to 9 per cent., but the rise in the amounts above which an additional payment of supplementary benefit is made, in the case of a fixed heating charge, were raised by about 18 per cent. The Minister knows that. The effect is that there are some people who should have expected to receive about £2·50 more in supplementary benefit, who receive that extra on their personal scale rates, but who receive less assistance on their heating allowance than they did before last November.
  I am surprised to see that the Minister appears puzzled when I say that. I believe it is a perfectly well-known point. It is an indefensible point, because if that element within the personal scale rates which is deemed to be available for heating within the scale rates is raised by more than 9 per cent., the other elements within the personal scale rates are clearly being raised by less than 9 per cent. The result is that a number of people are receiving less assistance with heating now than they were receiving before November. I hope that the Minister will look into that matter and refer to it during her reply. I shall read what she says with care.
  6.28 pm
  Mr. Frank FieldI apologise for not being here for the whole of the debate. I was meeting workers from Capenhurst who face redundancy. I found it ironic that they should lobby the House of Commons today, because they produce fuel, which gives us power, and we are making them unemployed while at the same time there are many people in my area who are without the necessary fuel to keep warm.
  We do not need to check on party records. Rather, we need to look at what the Government are offering and to see how that matches the needs of many families and old people in our community. Merseyside has suffered the coldest winter since 1740. Against that background, we must see the Government's new measures to deal with the problem of fuel poverty.
  The only new move is the issuing of instructions over single payments for supplementary benefit recipients. I wish to pose a number of questions to the Under-Secretary—questions that have already been put by one or two hon. Members. How many claimants will receive help under the scheme? What will be the cost? What will be

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  required in terms of staff time to run the scheme? I have calculated quickly that if staff were to carry out their instructions properly in the areas represented by the hon. Member for Wallasey (Mrs. Chalker) and myself and check whether there was a £300 savings disregard and the amounts of last year's and this year's fuel bills, an additional 100 full-time staff would be required in the two offices alone. This is what will be needed to give claimants a proper service.
  Given that the Government will not come up with that sort of staff increase, I should like to propose a programme for which the House should be pushing. I do not believe that any scheme that checks last year's bills and then examines this year's will work, because it will be hopelessly bureaucratic. The scheme will be extremely intensive in terms of office hours. A simpler method of helping claimants would be a flat rate grant, either through an additional pension increase or, as I would prefer, a £50 one-off grant.
  Help needs to be extended not only to those receiving supplementary benefit, but to those receiving rent and rate rebates and those on FIS. There is also a need for a policy covering disconnections. I have never urged abolition of disconnections as a unilateral policy. My request is that no disconnections should be made without a court order. The fuel boards must present their case to an independent body.
  Large numbers of our constituents are without work. I should like to know when the Government intend to create some work by offering people work in a nationwide insulation programme. I should also like the Government to consider abolishing standing charges on electricity and gas. The charges hit hardest those on the lowest incomes.
  The Government's answer is that my five-point crash programme will cost money. They will ask where the money is to come from. I shall suggest where it should come from. In their first Budget, in 1979, the Government managed to find the resources to give what were the old surtax payers a tax cut of £1·6 billion. This is the third year of those tax cuts. Under this Government the richest in our community have so far picked up a cool £4·8 billion. When the Government ask where the money is to come from, I suggest that a suitable target is those who have benefited most from tax cuts. If the Government say that the money is not available, hon. Members will know the Government's priorities. It will be seen that the needs of high income groups are more important to them than the needs of those who may be, or who are, suffering from hypothermia during this winter.
  6.32 pm
  Mr. J. W. RookerI believe the Opposition motion to be modest. It would have been interesting to see an amendment from the Liberals or the SDP stating what they wished to put forward. It ill behoves those Opposition parties to pour scorn on the motion and the amendment without putting forward a single constructive proposal themselves when there was more than adequate opportunity for them to do so.
  It must have concerned the Government and the Prime Minister to see headlines over the last few weeks claiming that several hundred people a week are dying of hypothermia. After all, the Prime Minister and the rest of the Cabinet are only human. They are, therefore, concerned. It must also he remembered, however, that they are also Conservative Party politicians who have been responsible this year, 1982–83, for cutting £1·4 billion
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  from the social security budget. Those are the Government's figures. They are not mine. Appendix 1 of the Social Services Select Committee report published in July last year contained a special memorandum from the Secretary of State. I shall not detail the contents of the £1·4 billion. Suffice it to say that £500 million came from:
  "Keeping pensions and long-term benefits in line with prices rather than the higher of prices and earnings."
  A further £200 million came from clawing back a penny in the pound of all social security benefits this year because they were allegedly overprovided for.
  The Government are therefore responsible for the £1·4 billion cut, by their own admission. It is also known, as I have already remarked, that they are concerned about what they have seen happening in the country over the past few weeks. They recognise that they are responsible for the cuts. The question that arises is what should be done. In my submission, the Government decided to make an announcement about what is already available within the social security system to help with fuel bills in such a way that it has been presented by gullible media—they do not generally ask too many pertinent questions—as Government action to meet an emergency caused by extreme weather conditions.
  There has been mention of 1947. No one can dispute that although the winter is only half over, the snow lasted longer in 1947 but it was not as cold as this year. I submit that the Government pushed out an announcement stating what was available in the guise of new action. The DHSS press release dated 14 January, although it must have been available to the press the day before, talks of extra help with high fuel bills for supplementary benefit claimants. It states:
  "Norman Fowler, Secretary of State for Social Services, announced today that a memo is being issued this week to all local offices…This action follows reports from the DHSS Regions which established that in certain areas some claimants were already running into trouble…The normal rules for the award of single payments apply."
  It is interesting what the press release did not say. There was simply attached to it the memorandum, not issued by Ministers or the Department, but issued by the chief supplementary benefits officer as part of his normal issue of memoranda to local offices explaining the various regulations that have been made since November 1980 when the supplementary benefit system changed. The Government issued the memorandum but did not issue the covering letter from the chief supplementary benefits officer which was, therefore, not received by the press. I refer to the letter issued by Mr. Alan Palmer.
  The responsibility, I understand, for interpreting the regulations and issuing the memoranda does not belong to Ministers. If Ministers sought to try to interpret regulations passed by the House they would be breaching section 1 of the Social Security Act 1980. The responsibility for issuing the memorandum and giving guidance on regulations does not belong to Ministers. They should not seek to claim credit, as they did, through the issue of the press notice. To discover whether the Government were successful, one only needs to take note of a couple of headlines. The Daily Mirror said "Cash for frozen families". The article stated:
  "The money will be paid out of a special fund set up last year to cover emergencies."
  In The Times, which should know better, the headline was "More fuel bill aid for the poor". The article refers to "extra help" and says that it is available under
  "a new supplementary benefit regulation."

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  While this regulation might be described as coming under the Supplementary Benefit (Single Payments) Regulations, 1981 it is, in fact, a consolidation of the regulation issued in 1980. That regulation has continued in force. It has not been changed. In The Guardian, under the heading "Cold victims to get cash aid", it was stated:
  "After pressure from MPs worried about the effect of the hard weather on the needy, the Government has approved emergency fuel payments."
  Those payments were approved by the House in November 1980. The quotations are legion. A gullible press fell for the suggestion that the Government were offering new money to meet the conditions of this winter. It does not stop there. The hon. Member for Cardigan (Mr. Howells), who spoke for the Liberal Party, made a more moderate, reasonable and constructive speech than did the other members of the Alliance, but the Liberal Party fell for the five-card trick that was played by the Government. I have here a copy of the Liberal pamphlet "Focus"—I have no intention of giving the local constituency any publicity by naming it—that was published last week, and which said, under the heading "Frosty facts":
  "Other new extra grants to help people on low incomes to meet higher electricity bills, as a result of the freeze-up, have just been announced."
  That is not true. It is not new money. Those grants have been available since 1980.
  Nowhere, as far as I can tell, did the Government give credit to the chief supplementary benefits officer. I want to put a question to the Minister which follows the question of my hon. Friend the Member for Birkenhead (Mr. Field). This regulation was in force in the winter of 1980–81. There is no dispute about that. Some parts of the country must have been more badly affected by bad weather than other parts, and it is highly likely that some local offices operated this allegedly new regulation a winter ago. What efforts has the Department made to find out which local offices made payments under regulation 26 of the supplementay benefit regulations?
  Is the confusion that clearly exists in the media born out of genuine concern? I do not think so. The Government's reaction to the problem, in the words of my right hon. Friend the Member for Birmingham, Small Heath (Mr. Howell), has been one of "monumental indifference". It is my opinion that they set out to cause confusion by misfortune. Those press headlines would not have followed the press release of the Department of Health and Social Security if there had been no evidence of confusion.
  I come now to fuel costs. I shall not give too many staistics. However, the country should be reminded that gas prices will rise by 12 per cent. in April 1982, and that they will rise by a further 10 per cent. under this Government's edict concerning a tax on gas later in 1982. It is true, of course, that there will be a 7 per cent rebate on the first quarter's electricity bills this year, but electricity charges will rise by 12 per cent. in April. The Under-Secretary of State for Energy shakes his head. Let me say that that figure came from yesterday's edition of The Sunday Times. If it is not true, no doubt we shall be told.
  I want to say a word about the retail price index in so far as it affects pensioners. The latest figure that is available is the measurement for the third quarter of 1980–81, where the special RPI for pensioners went up
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  10·4 per cent. The fuel and light element in that index over the same period went up 20·2 per cent. That is as near double as one can get.
  I shall say a word about the modesty of the Opposition motion. Item (b) of the Opposition motion talks of
  "extending Government help by paying to all recipients of State benefits a double payment in one week in the month of February."
  This refers to money that belongs to those people. One week's benefit is exactly 2 per cent. of a year's total benefit payment. As everyone knows, and as the Government have admitted, there was a 2 per cent. shortfall on payments last November, which is due to be made good for pensioners this November. It is those people's money that is to assist them at the time of the year when they need it, instead of staying in the Government's coffers until November. In any event, as I understand it, pensioners are not disconnected during winter months. We do not need to argue about that. To listen to some hon. Members, one would think that that was a novel proposal.
  Moreover, we are not arguing that there should be a moratorium on disconnections with no further action. No one is saying that. Clearly, steps will have to be taken, either to put in prepayment meters or to reform the system. As my hon. Friend the Member for Birkenhead said, there should be an independent element involved before anyone is disconnected. Back in 1975, when I moved a Ten-Minute Bill on this matter, I drew attention to the fact that the power to disconnect electricity falls under the 1882 Electric Lighting Act. In that year there were only a score of homes in this country with a supply of electric lighting. The powers to disconnect were not relevant, and there is evidence for that in the Royal Commission report that was published in 1884 on the housing of the working classes in this country. That made no mention at all of an electricity supply in any of those homes. It was not a problem because those homes did not have an electricity supply.
  There is one test of the concern that has been expressed. I do not criticise any of the Conservative Members who have spoken today on this problem. In a way, their speeches were all constructive. However, it is instructive that last week—the week when the House returned from the Christmas Recess—my researches and those of the Library show that not one Conservative Member tabled a question about the problems of the elderly, the disabled, the sick, and the problems of winter fuel bills and the inclement and extreme weather. Not one Conservative Member for Parliament sought to table even a written parliamentary question. I should add that the same is true of the Social Democratic and Liberal Alliance. The only people who emerged with any credit in terms of showing any concern last week were the Welsh Nationalists and Labour Members, who sought to challenge the Government and seek assistance. The Social Democratic Party has admitted that it has no policy to put to the House today, no amendment, and no questions for Ministers on the issues.
  Item (c) in the Opposition motion, asks for benefit in some form or another—we deliberately did not spell it out, because it is impossible to do so—for people receiving rent and rate rebates, who number over 3 million. I know that those people were included in only the final year of the Labour Government's three-year winter fuel discount scheme. The scheme was inadequate and inefficient, although I may say that the so-called paltry sum of £7·50

  657
  paid to those on rent and rate rebate would not go amiss to the 3 million people who will not receive that sum this year. I remind the Minister that that is exactly what she asked for when she was in Opposition. On 28 July 1977, in a debate on the consolidated fund, she complained bitterly about the defects in the Labour Government's scheme. She said:
  "There is a further difficulty. Many people are in receipt of rent and rate rebates and therefore not on supplementary benefit and entitled to the heating additions".—[Official Report, 28 July 1977; Vol. 936, c. 1104.]
  All that we are asking for is what the Labour Government left when this Government came into office, and what the present Minister asked for when in Opposition. There is therefore some modesty in the Oppositions's motion. The motion is positive and constructive, and we have no reason to be ashamed of it or of the Labour Government's actions.
  The test of progress in our society is the impact on the individual. It will be a pretty rum winter when the fuel bills start rolling in for millions of people who will get no help whatever under the schemes that have been put forward by the Government—people who were getting help under the Labour Government. I have no hesitation whatever in asking my right hon. and hon. Friends to vote for the motion tonight.
  6.48 pm
  The Under-Secretary of State for Health and Social Security (Mrs. Lynda Chalker)I cannot possibly reply to the whole of the three-and-a-half-hour debate and all the detailed points that have been raised. However, I shall read them all carefully, and if I have anything to add to what I shall say today I shall write to hon. Members.
  I have listened with care to a thoughtful debate in which contributions have been made from all parts of the House, some more constructive than others. Let me leave the House in no doubt that the Government fully accept that there is a major problem for people on low incomes facing severe winter weather. There is a danger that the removal of standing charges will increase prices to consumers. It would not necessarily benefit poor consumers, because they are not all small consumers—and those are the people who would benefit. However, my hon. Friend the Under-Secretary of State for Energy and I will look at the issue again.
  I thank my hon. Friend the Member for Somerset, North (Mr. Dean) for pointing out, as other hon. Members have done, that the Government have given substantial aid to those most severely affected by the difficulties in their plans for help with winter heating. The Government have sought to concentrate help on those in greatest need. That is why we felt it right to ensure that heating additions were payable automatically to householders on supplementary benefit who are severely disabled, elderly or who have young children.
  More than 2 million families automatically receive such extra help. In 1980 the heating additions were increased well ahead of fuel price rises and are at their highest real value—47 per cent., compared with a 28 per cent. increase in fuel prices. The increase in November 1981 has fully maintained that advance and the homes insulation scheme has been extended to provide enhanced grants for the elderly and severely disabled on low incomes. That is how we are spending over £250 million this year to help poor consumers. That figure does not include the special
  658
  measures under regulation 26 of the Supplementary Benefit Regulations, which are to be operated nationwide because of the severe winter weather. I shall comment later on the press release mentioned by the hon. Member for Birmingham, Perry Barr (Mr. Rooker).
  The hon. Member for Walsall, North (Mr. Winnick) accused the Government of not introducing new money in their £250 million package. However, we did introduce new money since all extra heating additions received that extra boost over the increase dictated by fuel prices and £65 million was added to the benefits available. Help is given not simply to claimants on supplementary benefit but also to those on family income supplement. It is better to concentrate over £85 per annum on those in greatest need—as the present scheme does—than to make an average payment of £7·50 per annum to those who use only electricity. Hon. Members from all parties criticised that scheme at the time, because those using gas or other heating fuels did not receive any help under the electricity discount scheme. It is right to consider those who use other forms of heating.
  I turn to the single payments for fuel, operated under regulation 26. I am pleased that on 14 January we were able to re-emphasise that, under powers that we took in 1980, all those entitled to or receiving supplementary benefit—including retirement pensioners—could apply for a special payment towards the extra cost of this winter's fuel bills. We promptly alerted local social security offices to deal with the expected claims. If hon. Members come across constituents who they believe are entitled to supplementary benefit, I hope that they will encourage them to investigate further because of the accompanying parcel of benefits.
  The Bill being considered in Committee will go a long way towards improving the situation by sorting out the housing benefits and ensuring that those who should claim supplementary benefit do so.
  Mr. Field rose—
  Mrs. ChalkerI shall not give way as I have precisely 15 minutes in which to speak.
  Mr. FieldHow many will qualify?
  Mrs. ChalkerI shall write to the hon. Member for Birkenhead (Mr. Field) and to the other hon. Members who have raised that question, as I do not have the figures to hand.
  I was also asked about the £300 capital rule under regulation 5. Opposition Members told me that it forbids single payments to be made. That is not so. Its application means that savings over £300 are deemed to be available towards the payment of fuel debts. However, I am particularly concerned about the elderly and I am considering the situation carefully.
  We have had problems with various electricity boards about "fuel direct". The hon. Member for Glasgow, Cathcart (Mr. Maxton) was right—I am sorry that I had to miss a small part of his speech—to ask about the possibility of regulations, following my meetings with the chairman of the South of Scotland Electricity Board. Arrangements and discussions are proceeding quite quickly and I shall shortly meet the chairman of the London Electricity Board to ensure that the suggestions made to Ministers are further investigated. In that way, we shall be able to respond to the House as quickly as

  659
  possible. I hope that that will suffice. I am grateful for the work being done on the problems in city centres, particularly in London. We are constantly considering the question of putting the recipients of supplementary benefit on to "fuel direct".
  Our Department feels that it is important to pay great attention to the insulation of homes. As the House knows, we have given additions for the insulation of hot water tanks and simple draught-proofing under the supplementary benefit scheme. In his opening remarks, my hon. Friend the Under-Secretary of State for Energy explained his wish to extend the type of neighbourhood scheme that we both visited last week in Fulham. For as little as £4, someone could have his loft insulated and could thus save an enormous amount of fuel. We want people to use the fuel that they buy to the maximum effect. I hope that hon. Members will advise their constituents to take up the 90 per cent. grants available to the elderly and disabled, and I hope that they will do so with all speed.
  An excellent leaflet on the code of practice is available, and individual fuel boards give excellent advice. However, the leaflet "How to pay for the electricity and gas bills", which is widely available, should be part of the kit in the hands of all those who advise their constituents and others about the problem of paying electricity and gas bills. It has been said that prepayment stamps are not such a good idea because they give fuel boards the money ahead of time. That is an unbelievable way of describing a method that has helped many to pay for their heating. I hope that we shall be successful in extending the availability of prepayment stamps through other outlets, apart from the fuel boards.
  The problem of disconnecting consumers worries all hon. Members, whatever party they may represent. Under the code of practice, area boards will treat consumers' problems sympathetically as long as arrangements are made to pay the account within a reasonable period. That is the most that we can ask. My hon. Friend the Under-Secretary of State for Energy discussed the issue with the chairman of the Electricity Council, who assured him and the House that area boards will follow not only the wording of the code but its spirit. They will not disconnect heartlessly during periods of severe weather. As set out in pages 5 and 6 of the code, area boards will have regard to what consumers tell them about their circumstances and incomes. The chairman has every reason to suppose that area boards will act similarly in future periods of severe cold weather.
  The hon. Member for St. Pancras, North (Mr. Stallard) cited some figures for disconnections. However, they were exaggerated, because the number of disconnections in December 1981 was equivalent to 284 per working day and not 500 per working day. Indeed, that was a reduction on the figures in November.
  Several hon. Members referred to publicity. Leaflet No. SB 17 has been available for some time and refers to help during severe weather conditions. The leaflet must be made widely available and brought to the notice of all those likely to be in difficulty as a result of higher energy costs. We also have leaflets on winter heating costs. The Health Education Council has published a leaflet entitled "Help keeping warm in winter." Let us hope that if the
  660
  debate does nothing else it will draw the general public's attention to the need for and availability of advice on their heating bills.
  We are now investigating the availability of posters to be displayed in post offices drawing attention to all the existing help, and are also looking at the availability of leaflets through various outlets to help people as far as we possibly can. Local radio tapes will also be available, and our regional information offices are taking every opportunity to ensure that every locality is fully briefed about the measures that we have taken.
  Every area board contains consumer representatives. It appeared from some of the comments made in the debate that the community was not represented at all. It is, and we urge consumers to take up that representation through the area fuel boards.
  I come back to the comments of the hon. Member for Perry Barr. He made a mountain out of a molehill, but I shall not draw attention to why that might have been. The press release issued by my right hon. Friend on 14 January last simply emphasised and drew attention to the memorandum of the chief supplementary benefits officer. The note to editors on the second page of the press release said:
  "A copy of the memo outlining the procedures…is attached".
  There was thus a definite mention, and paragraph 2 of the attachment stated:
  "Current conditions are so severe as to satisfy this condition nationally",
  which was otherwise subject to the discretion to which the hon. Member for Perry Barr referred. Above all, my right hon. Friend was seeking to draw the attention of the public and the press to the fact that the availability was national and not a matter of regional discretion.
  My hon. Friend the Under-Secretary of State for Energy dealt with the question of disconnections, and I have already repeated the words of the chairman of the Electricity Council. The sweeping and expensive proposals outlined in item (b) of the Opposition motion would cost between £500 million and £600 million a year. A double payment of benefit
  "in one week in the month of February"
  would give the greatest amount of benefit to those already receiving the largest benefit. It would operate unfairly both within groups—for instance, pensioners—and between groups—for example, pensioners and others receiving a high value benefit such as attendance allowance.
  The best course is that adopted by the Government. That would concentrate help with heating costs on those in greatest need in addition to the extra help that will go to the supplementary benefit recipient because of this year's exceptionally severe weather.
  A fuel bonus that would give a worthwhile sum to housing beneficiaries, whether or not item (b) in the Opposition motion were adopted, would cost more than £200 million a year. That money is simply not available at present, because it would be given out on a wide passport basis quite irrespective of the need that some may have in addition to other people's needs.
  I urge my hon. Friends and all hon. Members to support the Government amendment and to reject the costly and ill-thought-out Opposition motion.
  Question put, That the original words stand part of the Question:—
  The House divided: Ayes 202, Noes 277.

  Division No. 45]

  [7.4 pm

  AYES

  Abse, Leo

  Haynes, Frank

  Adams, Allen

  Heffer, Eric S.

  Allaun, Frank

  Hogg, N. (EDunb't'nshire)

  Anderson, Donald

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

  Archer, Rt Hon Peter

  Homewood, William

  Ashton, Joe

  Hooley, Frank

  Atkinson, N.(H'gey)

  Hoyle, Douglas

  Bagier, Gordon AT.

  Huckfield, Les

  Barnett, Guy ('Greenwich)

  Hughes, Mark (Durham)

  Barnett, Rt Hon Joel (H'wd)

  Hughes, Robert (Aberdeen N)

  Benn, Rt Hon Tony

  Hughes, Roy (Newport)

  Bennett, Andrew (St'kp'tN)

  Janner, Hon Greville

  Bidwell, Sydney

  Jay, Rt Hon Douglas

  Booth, Rt Hon Albert

  John, Brynmor

  Boothroyd, Miss Betty

  Johnson, James (Hull West)

  Bottomley, Rt HonA. (M'b'ro)

  Johnson, Walter (Derby S)

  Bray, Dr Jeremy

  Jones, Rt Hon Alec (Rh'dda)

  Brown, Hugh D. (Provan)

  Jones, Barry (East Flint)

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

  Jones, Dan (Burnley)

  Brown, Ron (E'burgh, Leith)

  Kaufman, Rt Hon Gerald

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

  Kerr, Russell

  Campbell, lan

  Kilroy-Silk, Robert

  Campbell-Savours, Dale

  Lambie, David

  Canavan, Dennis

  Lamborn, Harry

  Cant, R. B.

  Lamond, James

  Carmichael, Neil

  Leadbitter, Ted

  Carter-Jones, Lewis

  Leighton, Ronald

  Clark, Dr David (S Shields)

  Lestor, Miss Joan

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

  Lewis, Arthur (N'ham N W)

  Cohen, Stanley

  Lewis, Ron (Carlisle)

  Coleman, Donald

  Litherland, Robert

  Concannon, Rt Hon J. D.

  Lofthouse, Geoffrey

  Cook, Robin F.

  Lyon, Alexander (York)

  Cowans, Harry

  Mabon, Rt Hon Dr J. Dickson

  Craigen, J. M. (G'gow, M'hill)

  McCartney, Hugh

  Crowther, Stan

  McDonald, DrOonagh

  Cryer, Bob

  McElhone, Frank

  Cunningham, DrJ. (W'h'n)

  McKay, Allen (Penistone)

  Dalyell, Tam

  McKelvey, William

  Davidson, Arthur

  MacKenzie, Rt Hon Gregor

  Davies, Rt Hon Denzil (L'lli)

  McNamara, Kevin

  Davis, Clinton (Hackney C)

  McTaggart, Robert

  Davis, Terry (B 'ham, Stechf'd)

  McWilliam, John

  Dean, Joseph (Leeds West)

  Marks, Kenneth

  Dewar, Donald

  Marshall, D (G'gowS'ton)

  Dixon, Donald

  Marshall, DrEdmund (Goole)

  Dobson, Frank

  Marshall, Jim (Leicester S)

  Dormand, Jack

  Martin, M(G'gowS'burn)

  Douglas, Dick

  Mason, Rt Hon Roy

  Dubs, Alfred

  Maxton, John

  Dunnett, Jack

  Maynard, Miss Joan

  Dunwoody, Hon Mrs G.

  Meacher, Michael

  Eadie, Alex

  Mellish, Rt Hon Robert

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

  Mikardo, lan

  English, Michael

  Millan, Rt Hon Bruce

  Ennals, Rt Hon David

  Mitchell, Austin (Grimsby)

  Evans, loan (Aberdare)

  Morris, Rt Hon A. (W'shawe)

  Evans, John (Newton)

  Moyle, Rt Hon Roland

  Faulds, Andrew

  Newens, Stanley

  Field, Frank

  Oakes, Rt Hon Gordon

  Fitch, Alan

  Orme, Rt Hon Stanley

  Flannery, Martin

  Palmer, Arthur

  Foot, Rt Hon Michael

  Park, George

  Ford, Ben

  Parker, John

  Forrester, John

  Parry, Robert

  Foster, Derek

  Pendry, Tom

  Foulkes, George

  Powell, Raymond (Ogmore)

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

  Prescott, John

  Freeson, Rt Hon Reginald

  Race, Reg

  Garrett, John (Norwich S)

  Rees, Rt Hon M (Leeds S)

  George, Bruce

  Richardson, Jo

  Golding, John

  Roberts, Albert (Normanton)

  Graham, Ted

  Roberts, Allan (Bootle)

  Grant, George (Morpeth)

  Roberts, Gwilym (Cannock)

  Hamilton, James (Bothwell)

  Robinson, G. (Coventry NW)

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

  Rooker, J. W.

  Harrison, Rt Hon Walter

  Ross, Ernest (Dundee West)

  Hart, Rt Hon Dame Judith

  Rowlands, Ted

  662

  Ryman, John

  Varley, Rt Hon Eric G.

  Sheerman, Barry

  Wainwright, E. (Dearne V)

  Sheldon, Rt Hon R.

  Walker, Rt Hon H. (D'caster)

  Shore, Rt Hon Peter

  Watkins, David

  Short, Mrs Renée

  Weetch, Ken

  Silkin, Rt Hon J. (Deptford)

  Welsh, Michael

  Silkin, Rt Hon S. C. (Dulwich)

  White, Frank R.

  Silverman, Julius

  White, J. (G'gow Pollok)

  Skinner, Dennis

  Whitehead, Phillip

  Smith, Rt Hon J. (N Lanark)

  Whitlock, William

  Snape, Peter

  Wigley, Dafydd

  Soley, Clive

  Willey, Rt Hon Frederick

  Spearing, Nigel

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

  Spriggs, Leslie

  Wilson, Gordon (Dundee E)

  Stallard, A. W.

  Wilson, Rt Hon Sir H. (H'ton)

  Stoddart, David

  Wilson, William (C'try SE)

  Stott, Roger

  Winnick, David

  Straw, Jack

  Woodall, Alec

  Summerskill, Hon DrShirley

  Woolmer, Kenneth

  Taylor, Mrs Ann (Bolton W)

  Wright, Sheila

  Thomas, Dafydd (Merioneth)

  Young, David (Bolton E)

  Thomas, DrR. (Carmarthen)

  Thorne, Stan (Preston South)

  Tellers for the Ayes:

  Tinn, James

  Mr. Lawrence Cunliffe and

  Torney, Tom

  Mr. George Morton.

  NOES

  Adley, Robert

  Clegg, Sir Walter

  Aitken, Jonathan

  Cockeram, Eric

  Alexander, Richard

  Cope, John

  Alison, Rt Hon Michael

  Cormack, Patrick

  Amery, Rt Hon Julian

  Corrie, John

  Ancram, Michael

  Costain, Sir Albert

  Arnold, Tom

  Cranborne, Viscount

  Aspinwall, Jack

  Critchley, Julian

  Atkins, Rt Hon H. (S'thorne)

  Crouch, David

  Atkins, Robert (PrestonN)

  Dean, Paul (North Somerset)

  Baker, Kenneth (St.M'bone)

  Dickens, Geoffrey

  Baker, Nicholas (N Dorset)

  Dorrell, Stephen

  Beaumont-Dark, Anthony

  Douglas-Hamilton, Lord J.

  Bell, Sir Ronald

  Dover, Denshore

  Bendall, Vivian

  du Cann, Rt Hon Edward

  Benyon, Thomas (A'don)

  Dunn, Robert (Dartford)

  Benyon, W. (Buckingham)

  Dykes, Hugh

  Best, Keith

  Eden, Rt Hon Sir John

  Bevan, David Gilroy

  Eggar, Tim

  Biffen, Rt Hon John

  Elliott, SirWilliam

  Biggs-Davison, SirJohn

  Eyre, Reginald

  Blackburn, John

  Fairbairn, Nicholas

  Blaker, Peter

  Fairgrieve, SirRussell

  Body, Richard

  Faith, Mrs Sheila

  Bonsor, SirNicholas

  Farr, John

  Bottomley, Peter (W'wich W)

  Fell, SirAnthony

  Bowden, Andrew

  Fenner, Mrs Peggy

  Boyson, DrRhodes

  Finsberg, Geoffrey

  Braine, SirBernard

  Fisher, SirNigel

  Bright, Graham

  Fletcher, A. (Ed'nb'ghN)

  Brinton, Tim

  Fletcher-Cooke, SirCharles

  Brittan, Rt. Hon. Leon

  Fookes, Miss Janet

  Brooke, Hon Peter

  Forman, Nigel

  Brotherton, Michael

  Fowler, Rt Hon Norman

  Brown, Michael (Brigg&Sc'n)

  Fox, Marcus

  Browne, John (Winchester)

  Fraser, Peter (South Angus)

  Bruce-Gardyne, John

  Gardiner, George (Reigate)

  Bryan, Sir Paul

  Gardner, Edward (S Fylde)

  Buck, Antony

  Garel-Jones, Tristan

  Budgen, Nick

  Gilmour, Rt Hon Sir lan

  Bulmer, Esmond

  Glyn, Dr Alan

  Burden, SirFrederick

  Goodhew, SirVictor

  Butcher, John

  Goodlad, Alastair

  Cadbury, Jocelyn

  Gorst, John

  Carlisle, John (Luton West)

  Gow, lan

  Carlisle, Kenneth (Lincoln)

  Gray, Hamish

  Chalker, Mrs. Lynda

  Greenway, Harry

  Channon, Rt. Hon. Paul

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

  Chapman, Sydney

  Griffiths, Peter Portsm'thN)

  Churchill, W.S.

  Grist, lan

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

  Grylls, Michael

  Clark, Sir W. (Croydon S)

  Gummer, John Selwyn

  Clarke, Kenneth (Rushcliffe)

  Hamilton, Hon A.

  663

  Hamilton, Michael (Salisbury)

  Nelson, Anthony

  Hampson, DrKeith

  Neubert, Michael

  Hannam, John

  Newton, Tony

  Haselhurst, Alan

  Normanton, Tom

  Havers, Rt Hon Sir Michael

  Nott, Rt Hon John

  Hawksley, Warren

  Onslow, Cranley

  Hayhoe, Barney

  Oppenheim, Rt Hon Mrs S.

  Heath, Rt Hon Edward

  Page, Richard (SW Herts)

  Henderson, Barry

  Parris, Matthew

  Heseltine, Rt Hon Michael

  Patten, Christopher (Bath)

  Hicks, Robert

  Pattie, Geoffrey

  Higgins, Rt Hon Terence L.

  Pawsey, James

  Hogg, Hon Douglas (Gr'th'm)

  Percival, Sir lan

  Holland, Philip (Carlton)

  Pink, R.Bonner

  Hooson, Tom

  Pollock, Alexander

  Hordern, Peter

  Porter, Barry

  Howe, Rt Hon Sir Geoffrey

  Prentice, Rt Hon Reg

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

  Proctor, K. Harvey

  Howell, Ralph (N Norfolk)

  Pym, Rt Hon Francis

  Hunt, John (Ravensbourne)

  Raison, Timothy

  Jenkin, Rt Hon Patrick

  Rathbone, Tim

  JohnsonSmith, Geoffrey

  Rees-Davies, W. R.

  Jopling, Rt Hon Michael

  Renton, Tim

  Kaberry, Sir Donald

  Rhodes James, Robert

  Kellett-Bowman, Mrs Elaine

  Ridley, Hon Nicholas

  Kershaw, Sir Anthony

  Ridsdale, SirJulian

  King, Rt Hon Tom

  Rifkind, Malcolm

  Knox, David

  Roberts, M. (Cardiff NW)

  Lamont, Norman

  Roberts, Wyn (Conway)

  Lang, lan

  Rossi, Hugh

  Langford-Holt, SirJohn

  Rost, Peter

  Latham, Michael

  Royle, Sir Anthony

  Lawrence, lvan

  Sainsbury, Hon Timothy

  Lawson, Rt Hon Nigel

  St. John-Stevas, Rt Hon N.

  Lee, John

  Shaw, Giles (Pudsey)

  LeMarchant, Spencer

  Shaw, Michael (Scarborough)

  Lennox-Boyd, Hon Mark

  Shelton, William (Streatham)

  Lester, Jim (Beeston)

  Shepherd, Colin (Hereford)

  Lewis, Kenneth (Rutland)

  Shepherd, Richard

  Lloyd, lan (Havant & W'loo)

  Shersby, Michael

  Loveridge, John

  Silvester, Fred

  Luce, Richard

  Sims, Roger

  Lyell, Nicholas

  Skeet, T. H. H.

  McCrindle, Robert

  Speed, Keith

  Macfarlane, Neil

  Speller, Tony

  MacGregor, John

  Spence, John

  MacKay, John (Argyll)

  Spicer, Jim (West Dorset)

  Macmillan, Rt Hon M.

  Spicer, Michael (S Worcs)

  McNair-Wilson, M. (N'bury)

  Squire, Robin

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

  Stanbrook, lvor

  McQuarrie, Albert

  Stanley, John

  Madel, David

  Stevens, Martin

  Major, John

  Stewart, A. (E Renfrewshire)

  Marland, Paul

  Stewart, lan (Hitchin)

  Marlow, Antony

  Stokes, John

  Marshall, Michael (Arundel)

  Stradling Thomas, J.

  Marten, Rt Hon Neil

  Tapsell, Peter

  Mates, Michael

  Taylor, Teddy (S'end E)

  Maude, Rt Hon Sir Angus

  Tebbit, Rt Hon Norman

  Mawby, Ray

  Temple-Morris, Peter

  Mawhinney, DrBrian

  Thomas, Rt Hon Peter

  Maxwell-Hyslop, Robin

  Thompson, Donald

  Mayhew, Patrick

  Thorne, Neil (llford South)

  Mellor, David

  Thornton, Malcolm

  Meyer, Sir Anthony

  Townend, John (Bridlington)

  Miller, Hal (B'grove)

  Townsend, Cyril D, (B'heath)

  Mills, lain (Meriden)

  Trippier, David

  Mills, Peter (West Devon)

  Trotter, Neville

  Miscampbell, Norman

  van Straubenzee, Sir W.

  Monro, SirHector

  Vaughan, DrGerard

  Montgomery, Fergus

  Viggers, Peter

  Moore, John

  Waldegrave, Hon William

  Morris, M. (N'hamptonS)

  Walker, Rt Hon P. (W'cester)

  Morrison, Hon C. (Devizes)

  Walker-Smith, Rt Hon Sir D.

  Morrison, Hon P. (Chester)

  Waller, Gary

  Mudd, David

  Walters, Dennis

  Murphy, Christopher

  Ward, John

  Myles, David

  Watson, John

  Neale, Gerrard

  Wells, Bowen

  Needham, Richard

  Wells, John (Maidstone)

  664

  Wheeler, John

  Wolfson, Mark

  Whitelaw, Rt Hon William

  Young, SirGeorge (Acton)

  Whitney, Raymond

  Younger, Rt Hon George

  Wickenden, Keith

  Wiggin, Jerry

  Tellers for the Noes:

  Wilkinson, John

  Mr. Anthony Berry and

  Williams, D.(Montgomery)

  Mr. Robert Boscawen.

  Winterton, Nicholas

  Question accordingly negatived.
  Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 32 (Questions on amendments):
  The House divided: Ayes 271, Noes 201.

  Division No. 46]

  [7.16 pm

  AYES

  Adley, Robert

  Dunn, Robert (Dartford)

  Aitken, Jonathan

  Dykes, Hugh

  Alexander, Richard

  Eden, Rt Hon Sir John

  Amery, Rt Hon Julian

  Eggar, Tim

  Ancram, Michael

  Elliott, SirWilliam

  Arnold, Tom

  Eyre, Reginald

  Aspinwall, Jack

  Fairbairn, Nicholas

  Atkins, Rt Hon H.(S'thorne)

  Fairgrieve, Sir Russell

  Atkins, Robert (PrestonN)

  Faith, Mrs Sheila

  Baker, Kenneth (St.M'bone)

  Fell, Sir Anthony

  Baker, Nicholas (NDorset)

  Fenner, Mrs Peggy

  Beaumont-Dark, Anthony

  Finsberg, Geoffrey

  Bendall, Vivian

  Fisher, Sir Nigel

  Benyon, Thomas (A'don)

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

  Benyon, W. (Buckingham)

  Fletcher-Cooke, SirCharles

  Best, Keith

  Fookes, Miss Janet

  Bevan, David Gilroy

  Forman, Nigel

  Biffen, Rt Hon John

  Fowler, Rt Hon Norman

  Biggs-Davison, SirJohn

  Fox, Marcus

  Blackburn, John

  Fraser, Peter (South Angus)

  Blaker, Peter

  Gardiner, George (Reigate)

  Body, Richard

  Gardner, Edward (S Fylde)

  Bonsor, SirNicholas

  Garel-Jones, Tristan

  Bottomley, Peter (W'wich W)

  Gilmour, Rt Hon Sir lan

  Bowden, Andrew

  Glyn, Dr Alan

  Boyson, Dr Rhodes

  Goodhew, SirVictor

  Braine, SirBernard

  Goodlad, Alastair

  Bright, Graham

  Gorst, John

  Brinton, Tim

  Gow, lan

  Brittan, Rt. Hon. Leon

  Gray, Hamish

  Brooke, Hon Peter

  Greenway, Harry

  Brotherton, Michael

  Griffiths, E. (B'y St. Edm'ds)

  Brown, Michael (Brigg & Sc'n)

  Griffiths, Peter Portsm'th N)

  Browne, John (Winchester)

  Grist, Ian

  Bruce-Gardyne, John

  Grylls, Michael

  Bryan, Sir Paul

  Gummer, John Selwyn

  Buck, Antony

  Hamilton, Hon A.

  Budgen, Nick

  Hamilton, Michael (Salisbury)

  Bulmer, Esmond

  Hampson, DrKeith

  Burden, SirFrederick

  Hannam, John

  Butcher, John

  Haselhurst, Alan

  Cadbury, Jocelyn

  Havers, Rt Hon Sir Michael

  Carlisle, John (Luton West)

  Hawksley, Warren

  Chalker, Mrs. Lynda

  Hayhoe, Barney

  Channon, Rt. Hon. Paul

  Heath, Rt Hon Edward

  Churchill, W.S.

  Henderson, Barry

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

  Heseltine, Rt Hon Michael

  Clark, Sir W. (Croydon S)

  Hicks, Robert

  Clarke, Kenneth (Rushcliffe)

  Higgins, Rt Hon Terence L.

  Clegg, Sir Walter

  Hogg, Hon Douglas (Gr'th'm)

  Cockeram, Eric

  Holland, Philip (Carlton)

  Cope, John

  Hooson, Tom

  Cormack, Patrick

  Hordern, Peter

  Costain, Sir Albert

  Howe, Rt Hon Sir Geoffrey

  Cranborne, Viscount

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

  Crouch, David

  Howell, Ralph (NNorfolk)

  Dean, Paul (North Somerset)

  Hunt, John (Ravensbourne)

  Dickens, Geoffrey

  Jenkin, Rt Hon Patrick

  Dorrell, Stephen

  Johnson Smith, Geoffrey

  Douglas-Hamilton, LordJ.

  Jopling, Rt Hon Michael

  Dover, Denshore

  Kaberry, Sir Donald

  du Cann, Rt Hon Edward

  Kellett-Bowman, Mrs Elaine

  665

  Kershaw, Sir Anthony

  Raison, Timothy

  King, Rt Hon Tom

  Rathbone, Tim

  Knox, David

  Rees-Davies, W. R.

  Lamont, Norman

  Renton, Tim

  Lang, lan

  Rhodes James, Robert

  Langford-Holt, SirJohn

  Ridley, Hon Nicholas

  Latham, Michael

  Ridsdale, SirJulian

  Lawrence, lvan

  Rifkind, Malcolm

  Lawson, Rt Hon Nigel

  Roberts, M. (Cardiff NW)

  Lee, John

  Roberts, Wyn (Conway)

  LeMarchant, Spencer

  Rossi, Hugh

  Lennox-Boyd, Hon Mark

  Rost, Peter

  Lester, Jim (Beeston)

  Royle, Sir Anthony

  Lewis, Kenneth (Rutland)

  Sainsbury, Hon Timothy

  Lloyd, lan (Havant & W'loo)

  St. John-Stevas, Rt Hon N.

  Loveridge, John

  Shaw, Giles (Pudsey)

  Luce, Richard

  Shaw, Michael (Scarborough)

  Lyell, Nicholas

  Shelton, William (Streatham)

  McCrindle, Robert

  Shepherd, Colin (Hereford)

  Macfarlane, Neil

  Shepherd, Richard

  MacGregor, John

  Shersby, Michael

  MacKay, John (Argyll)

  Silvester, Fred

  Macmillan, Rt Hon M.

  Sims, Roger

  McNair-Wilson, M.(N'bury)

  Skeet, T. H. H.

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

  Speed, Keith

  McQuarrie, Albert

  Speller, Tony

  Madel, David

  Spence, John

  Major, John

  Spicer, Jim (West Dorset)

  Marland, Paul

  Spicer, Michael (S Worcs)

  Marlow, Antony

  Squire, Robin

  Marshall, Michael (Arundel)

  Stanbrook, lvor

  Marten, Rt Hon Neil

  Stanley John

  Mates, Michael

  Stevens, Martin

  Maude, Rt Hon Sir Angus

  Stewart, A. (ERenfrewshire)

  Mawby, Ray

  Stewart, lan (Hitchin)

  Mawhinney, DrBrian

  Stokes, John

  Maxwell-Hyslop, Robin

  Stradling Thomas, J.

  Mayhew, Patrick

  Tapsell, Peter

  Mellor, David

  Taylor, Teddy (S'end E)

  Meyer, Sir Anthony

  Tebbit, Rt Hon Norman

  Miller, Hal (B'grove)

  Temple-Morris, Peter

  Mills, lain (Meriden)

  Thomas, Rt Hon Peter

  Mills, Peter (West Devon)

  Thompson, Donald

  Miscampbell, Norman

  Thome, Neil (llford South)

  Mitchell, David (Basingstoke)

  Thornton, Malcolm

  Monro, SirHector

  Townend, John (Bridlington)

  Montgomery, Fergus

  Townsend, Cyril D, (B'heath)

  Moore, John

  Trippier, David

  Morris, M. (N'hamptonS)

  Trotter, Neville

  Morrison, Hon C. (Devizes)

  van Straubenzee, Sir W.

  Morrison, Hon P. (Chester)

  Vaughan, DrGerard

  Mudd, David

  Viggers, Peter

  Murphy, Christopher

  Waldegrave, Hon William

  Myles, David

  Walker, Rt Hon P.(W'cester)

  Neale, Gerrard

  Walker-Smith, Rt Hon Sir D.

  Needham, Richard

  Waller, Gary

  Nelson, Anthony

  Walters, Dennis

  Neubert, Michael

  Ward, John

  Newton, Tony

  Watson, John

  Normanton, Tom

  Wells, Bowen

  Nott, Rt Hon John

  Wells, John (Maidstone)

  Onslow, Cranley

  Wheeler, John

  Oppenheim, Rt Hon Mrs S.

  Whitelaw, Rt Hon William

  Page, Richard (SW Herts)

  Whitney, Raymond

  Parris, Matthew

  Wickenden, Keith

  Patten, Christopher (Bath)

  Wiggin, Jerry

  Pattie, Geoffrey

  Williams, D. (Montgomery)

  Pawsey, James

  Winterton, Nicholas

  Percival, Sir lan

  Wolfson, Mark

  Pink, R. Bonner

  Young, SirGeorge (Acton)

  Pollock, Alexander

  Younger, Rt Hon George

  Porter, Barry

  Prentice, Rt Hon Reg

  Tellers for the Ayes:

  Proctor, K. Harvey

  Mr. Anthony Berry and

  Pym, Rt Hon Francis

  Mr. Robert Boscawen.

  NOES

  Abse, Leo

  Anderson, Donald

  Adams, Allen

  Archer, Rt Hon Peter

  Allaun, Frank

  Ashton, Joe

  666

  Atkinson, N. (H'gey)

  Hughes, Mark (Durham)

  Bagier, Gordon A. T.

  Hughes, Robert (Aberdeen N)

  Barnett, Guy (Greenwich)

  Hughes, Roy (Newport)

  Barnett, Rt Hon Joel (H'wd)

  Janner, Hon Greville

  Benn, Rt Hon Tony

  Jay, Rt Hon Douglas

  Bennett, Andrew (St'kp'tN)

  John, Brynmor

  Bidwell, Sydney

  Johnson, James (Hull West)

  Booth, Rt Hon Albert

  Johnson, Walter (Denby S)

  Boothroyd, Miss Betty

  Jones, Rt Hon Alec (Rh'dda)

  Bottomley, Rt Hon A. (M'b'ro)

  Jones, Barry (East Flint)

  Bray, Dr Jeremy

  Jones, Dan (Burnley)

  Brown, Hugh D. (Provan)

  Kaufman, Rt Hon Gerald

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

  Kerr, Russell

  Brown, Ron (E'burgh, Leith)

  Kilroy-Silk, Robert

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

  Lambie, David

  Campbell, lan

  Lamborn, Harry

  Campbell-Savours, Dale

  Lamond, James

  Canavan, Dennis

  Leadbitter, Ted

  Cant, R. B.

  Leighton, Ronald

  Carmichael, Neil

  Lestor, Miss Joan

  Carter-Jones, Lewis

  Lewis, Arthur (N'ham NW)

  Clark, Dr David (S Shields)

  Lewis, Ron (Carlisle)

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

  Litherland, Robert

  Cohen, Stanley

  Lofthouse, Geoffrey

  Coleman, Donald

  Lyon, Alexander (York)

  Concannon, Rt Hon J. D.

  Mabon, Rt Hon Dr J. Dickson

  Cook, Robin F.

  McCartney, Hugh

  Cowans, Harry

  McDonald, DrOonagh

  Craigen, J. M. (G'gow, M'hill)

  McElhone, Frank

  Crowther, Stan

  McKay, Allen (Penistone)

  Cryer, Bob

  McKelvey, William

  Cunningham, DrJ. (W'h'n)

  MacKenzie, Rt Hon Gregor

  Dalyell, Tam

  McNamara, Kevin

  Davidson, Arthur

  McTaggart, Robert

  Davies, Rt Hon Denzil (L'lli)

  McWilliam, John

  Davis, Clinton (HackneyC)

  Marks, Kenneth

  Davis, Terry (B'ham, Stechf'd)

  Marshall, D (G'gowS'ton)

  Dean, Joseph (Leeds West)

  Marshall, DrEdmund (Goole)

  Dewar, Donald

  Marshall, Jim (LeicesterS)

  Dixon, Donald

  Martin, M (G'gowS'burn)

  Dobson, Frank

  Mason, Rt Hon Roy

  Dormand, Jack

  Maxton, John

  Douglas, Dick

  Maynard, Miss Joan

  Dubs, Alfred

  Meacher, Michael

  Dunnett, Jack

  Mellish, Rt Hon Robert

  Dunwoody, Hon Mrs G.

  Mikardo, lan

  Eadie, Alex

  Millan, Rt Hon Bruce

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

  Morris, Rt Hon A. (W'shawe)

  English, Michael

  Morton, George

  Ennals, Rt Hon David

  Moyle, Rt Hon Roland

  Evans, loan (Aberdare)

  Newens, Stanley

  Evans, John (Newton)

  Oakes, Rt Hon Gordon

  Faulds, Andrew

  Orme, Rt Hon Stanley

  Field, Frank

  Palmer, Arthur

  Fitch, Alan

  Park, George

  Flannery, Martin

  Parker, John

  Foot, Rt Hon Michael

  Parry, Robert

  Ford, Ben

  Pendry, Tom

  Forrester, John

  Powell, Raymond (Ogmore)

  Foster, Derek

  Prescott, John

  Foulkes, George

  Race, Reg

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

  Rees, Rt Hon M (Leeds S)

  Freeson, Rt Hon Reginald

  Richardson, Jo

  Garrett, John (Norwich S)

  Roberts, Albert (Normanton)

  George, Bruce

  Roberts, Allan (Bootle)

  Golding, John

  Roberts, Gwilym (Cannock)

  Graham, Ted

  Robinson, G. (Coventry NW)

  Grant, George (Morpeth)

  Rooker, J.W.

  Hamilton, James (Bothwell)

  Ross, Ernest (Dundee West)

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

  Rowlands, Ted

  Harrison, Rt Hon Walter

  Ryman, John

  Hart, Rt Hon Dame Judith

  Sheerman, Barry

  Haynes, Frank

  Sheldon, Rt Hon R.

  Heffer, Eric S.

  Shore, Rt Hon Peter

  Hogg, N. (E Dunb't'nshire)

  Short, Mrs Renée

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

  Silkin, Rt Hon J. (Deptford)

  Homewood, William

  Silkin, Rt Hon S. C. (Dulwich)

  Hooley, Frank

  Silverman, Julius

  Hoyle, Douglas

  Skinner, Dennis

  Huckfield, Les

  Smith, Rt Hon J. (N Lanark)

  667

  Snape, Peter

  White, Frank R.

  Soley, Clive

  White, J. (G'gowPollok)

  Spearing, Nigel

  Whitehead, Phillip

  Spriggs, Leslie

  Whitlock, William

  Stallard, A. W.

  Wigley, Dafydd

  Stoddart, David

  Willey, RtHon Frederick

  Stott, Roger

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

  Straw, Jack

  Wilson, Gordon (DundeeE)

  Summerskill, HonDrShirley

  Wilson, Rt Hon SirH. (H'ton)

  Taylor, Mrs Ann (Bolton W)

  Wilson, William (C'trySE)

  Thomas, Dafydd (Merioneth)

  Winnick, David

  Thorne, Stan (PrestonSouth)

  Woodall, Alec

  Tinn, James

  Woolmer, Kenneth

  Torney, Tom

  Wright, Sheila

  Varley, Rt Hon Eric G.

  Young, David (BoltonE)

  Wainwright, E. (DearneV)

  Walker, Rt Hon H. (D'caster)

  Tellers for the Noes:

  Watkins, David

  Mr. Lawrence Cunliffe and

  Weetch, Ken

  Mr. Austin Mitchell.

  Welsh, Michael

  Question accordingly agreed to.
  MR. SPEAKER forthwith declared the main Question, as amended, to be agreed to.
  Resolved,
  That this House welcomes the steps taken by Her Majesty's Government to protect those most at risk from severe weather in having (a) at the beginning of this winter fully maintained value of last year's already substantial help with fuel costs, (b) maintained in the new supplementary benefit scheme provision for payments to meet the extra cost of additional fuel consumption during exceptionally severe weather and (c) continued co-operation with the fuel industries to ensure that the industries' code of practice on payment of bills is operated effectively; and further welcomes the consideration and initiative shown by electricity boards in recently suspending disconnections for seven days.

Steel Industry
7.28 pm
Dr. John CunninghamI beg to move,
That this House calls upon Her Majesty's Government to give full support to the British Steel Corporation and its workers to ensure that jobs and production capacity are maintained at their present levels.
Mr. SpeakerI have selected the amendment in the name of the Prime Minister.
Dr. CunninghamWe chose the subject for debate because of considerable concern about a number of problems facing the BSC. They were referred to by the chairman of the corporation, Mr. MacGregor, when he gave evidence to a Select Committee. In summary, he said that the uncertainties facing the corporation now were greater than at the time that he proposed his first survival plan for the BSC. We make no apology for asking the House to debate the problems this evening. These are also real problems for United Kingdom private steel makers.
Since the most important of the difficulties facing the corporation directly involve the Government, and, broadly speaking, are matters beyond the control of the corporation or its work force, we should have the opportunity of examining the Government's attitude to the problems and of asking questions in the hope that they will be able to reassure us. Of course, the best reassurance would be for the Government to accept the motion.
About six months have elapsed since we debated the EEC steel documents in July. Those agreements are at the centre of the present major international uncertainties facing the corporation. The problems within the EEC and the United States revolve around the EEC agreements on quotas and prices. There have also been problems about the recent severe weather, on which the corporation said something.
While, of course, it is serious for the corporation to incur significant operational losses—as no doubt it has done—we do not accept for a moment that the long-term strategy of the steel industry should be decided by the problems caused by four weeks of severe winter weather. I was surprised at some of the emphasis apparently given by those in the corporation to those problems. After all, steel industries are run in Pittsburgh, northern Germany, Japan, other parts of northern Europe and in the USSR where the weather is significantly more severe and certainly more prolonged than the bad weather that we have endured. There is no evidence to suppose that those countries determine the future of their steel industries according to the severity of their winters.
The Minister of State can be reassured, however, that whatever else I blame the Government for, I will not blame them for the weather problems. I hope that he will not accept that their outcome should be reason for criticising the corporation or for changing the present commitment to the MacGregor plan.
On behalf of my right hon. and hon. Friends, I praise the work force in the industry and, particularly, the workers in South Wales who did so much to try to ensure the safety and some output from the plant to the point where many of them—perhaps because they had no choice—stayed in the plant for several days, working to protect the major investment from which they earned their livelihood. It was appropriate that Mr. MacGregor should make similar comments on his recent visit to South Wales.

669
Of course, similar praise is deserved throughout the corporation for the way that men and management faced up to the problems, and I associate all hon. Members on the Opposition side of the House with those comments.
The most important problem facing the corporation is the continuing deep domestic recession in the United Kingdom and the Government's abysmal record on the economy and British industry in general. That is at the heart of the BSC's dilemma.
Deliveries of finished steel products to United Kingdom suppliers and consumers have fallen by about 12 per cent. during the Government's period in office, doing very severe damage to the corporation's prospects and to the taxpayer's investments in our various modern and efficient plants. They are the issues for debate.
Mr. MacGregor is in no doubt about the seriousness of the problem because he recently referred in the steel industry's newspaper to the grim outlook for the corporation. He also said that there were no signs that the British economy, including the steel-using industry, would improve very much during the next two years. He was not very sanguine about the impact of the Government's policies on improving the lot of the industry that he runs. That is a pity because since the industry embarked on the present plan—indeed, in the first six months of the current financial year—progress has been fairly good and the plan was broadly on target. That is welcome news even though I reiterate that the Opposition had reservations about some aspects of it. There has been well over 90 per cent. utilisation of capacity and about 7 million tonnes of steel have been produced in the first six months. Therefore, why is progress now threatened?
We all know of the action proposed by United States steel producers against steel exports from the EEC and imports into the American economy from other parts of the world. Even if it were taken, it would not affect a major amount of the BSC's output.
The corporation's progress is no longer threatened by manning levels. Mr. MacGregor's forecast for manning in March 1982 was 107, 000. That figure was reached in November 1981 and it therefore seems that the corporation is well on schedule in improving manning levels. Nor is there much evidence, if any, to support the argument that the corporation's progress is being threatened by wage costs. They are among the lowest in Europe and in the overall cost implications of producing steel the total cost of production is important—not just wage costs, the cost per man-hour or however one refers to labour costs in the industry.
The corporation's prospects have been aggravated by action in the United States which, if carried through, would have an impact on the ability of the corporation to market its existing production levels. The United States action is strange for many reasons. America had a significant domestic steel production last year. It increased by about 8·3 per cent. EEC exports to America certainly do not appear to be particularly onerous in terms of total United States steel consumption.
My figures show that Belgium and Luxembourg export about 200, 000 tonnes, France 169, 000, West Germany 319, 000 to 320, 000, Italy just over 106, 000 and Britain just under 82, 000 tonnes. That is compared with Canada's exports of 800, 000 and Japan's almost 1·2 million tonnes. Therefore, whatever the problems of steel imports into the United States, there is not much evidence to support the argument that the imports are mainly European. If we add
670
to that the fact that United Kingdom exports to America are now only about 30 per cent. of what they were in the peak years of the mid-1970s, it will be seen that our exports have decreased by roughly 60 per cent. in the past five years and are only about 3 per cent. of total American imports. That is a very small proportion. The Secretary of State spoke about that recently. The current edition of "British Business" reports on a meeting of Community Industry Ministers in Brussels to discuss the allegation of several major United States steel companies that the Community was selling steel below fair prices and states:
"These charges were rejected outright by the ministers who put the blame for United States producers' difficulties on the worsening economic situation in the United States".
What an admission! The Opposition thought that "Reaganomics" was plagiarised Thatcherism. If the Secretary of State does not think that the President's policies are working and are damaging the prospects for his steel industry, he could have given the game away on the British Government's policies. Most people believe that the President's policies are closely allied to those of our Government. If they are damaging to the American industrial scene, it surely follows that they are equally damaging to our prospects, which is what we have argued for a long time.
I said earlier that many, if not all, of the problems were outside the control of the BSC, and the American attitude to imports certainly falls in that category. The corporation asserts that it is not causing a problem and is selling fairly into the American market. If the fault does not lie with the BSC, but the problem is a European one, who is responsible? The Secretary of State says that there in no European problem, but the Secretary of Commerce in the United States, Mr. Malcolm Baldridge, has no doubt that the EEC industries are failing to abide by the guidelines of the trigger price mechanism.
The mechanism was agreed in 1977–78 when problems last arose and it seems to have worked reasonably well, but Mr. Baldridge said in a press statement:
"The Communities' response has failed to convince the American industry that the TPM can continue to be an effective means of enforcing US trade laws."
That is a fairly definite posture for America to take. If the difficulty is to be resolved it will need action by Governments within the EEC. There is considerable feeling in the public and private sectors in Britain that the problem can be laid at the door of the steel producers in some other EEC countries.
The major problem is not that of the closure of the American market. The threat is the collapse of the agreement on quotas, which would bring back confusion to steel production and pricing and the steel market in Europe. The prospects for our industry would be put at grave risk. Again, we argue that the Government have a responsibility to act on that problem.
We also believe that there should be no more closures of capacity in Britain while the problems are being resolved. I reiterate that forcefully. The sentiment was enshrined in the Opposition amendment in the July debate. We said that we declined to accept further reductions in steel manufacturing capacity in the United Kingdom, but the Government decided to vote against the amendment. They now have an opportunity to convince us and, more important, those in the industry, that they are willing to stand by them, the massive financial reconstruction of the industry that has recently taken place, and the taxpayers'

671
major investment in modern plant and equipment. That is what we are asking for, and I hope that the Minister of State will give us that assurance.
It is not as though closing plants has solved the problem. There has been a string of closures, costing about £670 million in the past three years. The rate of closures and the loss of jobs in Britain have far outstripped anything that has taken place in the EEC. I am grateful to the Iron and Steel Trades Confederation for helping me in the collation of figures. In West Germany there has been a 4 per cent. cut in employment. In France there has been a 7 per cent. cut, in Italy a 1 per cent. cut and in Belgium a 2 per cent. cut. In the United Kingdom there has been a 21 per cent. reduction in employment, with an associated closure of capacity.
As we have said before, if there is to be a further reduction in steel capacity within the EEC it should not begin in the United Kingdom. Indeed, we go further and say that none of it should take place in the United Kingdom.
Mr. Frank HooleyIs my hon. Friend aware that, far from reducing capacity, Spain and Italy have substantially increased their production capacity over the past few years?
Dr. CunninghamThat is so. Expansions of capacity have been taking place elsewhere and penetration of the United Kingdom market from within the EEC has been continuing apace. We have a large imbalance in steel trade with our EEC partners.
Our exports and imports are broadly in balance, which is not the case in a number of other EEC countries, including Belgium, Luxembourg and the Federal Republic of Germany. We should remind ourselves of the traumas that we have been through in connection with steel policy. There have been major closures, with whole towns being put out of work and massive sacrifices made by thousands of families.
We should resolve tonight to tackle the problems facing the BSC and to ensure that they are tackled on the basis of fairness and equity within the EEC, not on the basis of even more unjustifiable sacrifices having to be made by those in our steel making communities.
I return briefly to the subject of the weather. The BSC has said that it may lose up to about £100 million in the current financial year and perhaps significantly more in the next financial year if the United States action is confirmed. The latter statement was made to the Select Committee on Industry and Trade by the chairman of the corporation.
Against this we should set the Government's attitude to the external financing limit of the corporation, which in 1981–82 was £730 million. In December the Government suggested that in 1982–83 the figure should be £350 million—less than half the figure for the previous financial year. Mr. MacGregor suggested that it should be £70 million or £80 million more than that. Why has this change been made? If it is only under consideration, when can the corporation expect a final decision, which will remove some of the uncertainty about the future financial prospects?
The Conservative Party must not lay most of the uncertainties facing the BSC at the door of the workers and the trade unions in the industry, who have accepted a great deal, and a great deal of criticism. I hope that Conservative
672
Members will avoid falling into their all too frequent habit of blaming the workers and the trade unions for the problems of the steel industry, especially as for some time the Government have refused to appoint two of the union nominees as worker directors. That is another question for the Government—why has that issue gone on for so long? It is obviously an irritant to the unions. There seems to be no explicit argument in favour of not making the appointments. The chairman seems to believe that he can exercise a sort of veto. The Labour Party objects to that. The places should be filled as quickly as possible and I hope that the Minister will give us an assurance this evening. This attitude causes irritation and leads to bad relationships within the corporation.
Mr. Stan CrowtherNo doubt my hon. Friend has read the minutes of evidence of the Select Committee on Industry and Trade, in which I question the Secretary of State on this matter. He will be aware that the Secretary of State has, in effect, abdicated his duty to make the appointment after consultation with the chairman. He has, for all practical purposes, handed over the responsibility for making the decision to the chairman of BSC. The chairman in turn has decided that he does not like one of the appointments offered to him and has turned it down.
Dr. CunninghamThe chairman of BSC is thus frustrating the intentions of the Act. What my hon. Friend has said is confirmed by correspondence between my right hon. Friend the Member for Salford, West (Mr. Orme), who has already raised the point, and the Secretary of State for Industry.
It is almost certain that total unemployment will be announced to be more than 3 million tomorrow. In steel areas such as Glasgow the total tops 20 per cent. In Workington, where major closures have taken place, unemployment is at 20 per cent. In Consett it is over 30 per cent. In parts of Teesside the figures are well in excess of 20 per cent. In Scunthorpe they are 19 per cent. and in parts of South Wales they are 20 to 21 per cent.
The Labour Party needs to advance no more arguments than those figures for saying that it is opposed to a further reduction in the capacity and scope of the corporation's activities. These communities cannot take any more unemployment. Against this background, why has there been no final decision yet on the corporate plan? Why have the Government not taken greater initiatives to help the industry on energy costs?
The chairman of the NEDO sector working party on iron and steel wrote to the Secretary of State recently to draw his attention to the fact that there was no evidence of any concerted attempt to help the various companies in the sector with energy problems, which have been well set out and thoroughly examined. Major international comparisons have been made and the Government can act in that direction, too, to help the corporation overcome one of its difficulties.
It is reported that Mr. MacGregor is calling for a complete review of the corporation's financial projections. He must be in something of a dilemma, given the Government's indecision over the external financing limit, given that he has had no final answer on his corporate plan and given the corporation's need to take advantage of a larger home market. The statement made by the Secretary of State on the private sector a few weeks ago implied

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some contraction in that area too. Is that contraction in capacity to be filled by more imports or is the corporation to be put into, or helped into, a position by the Government to take the opportunity of getting a greater share of the British market? I remind the House that imports are already almost 30 per cent. of the steel consumed in the United Kingdom.
I return to Mr. MacGregor's view about the future prospects of the economy as a whole. We have seen another year during which the fall in GDP has been between 2 per cent. and 3 per cent. Major capital investment programmes have been set aside, programmes that were vital to the well-being of so much of everyday life in Britain. The programmes that were set aside involved the railways and the gas-gathering pipeline. The latter would have gone a long way towards ensuring future gas supplies. There has been a collapse in the building and construction industries. All these factors have had a major impact on the prospects for British Steel and its production and output.
In the two years since the abolition of exchange controls Britains's financial institutions have invested £4, 500 million overseas. The scale of that outflow is best illustrated by the fact that the same institutions invested about the same amount in Britain. We are investing at least as much in our competitor countries and in industries overseas under this Administration as we are in our own industries. What a difference there would have been in our own economy and industry if even half of that money had been invested in Britain rather than abroad. That is a measure of the Government's failure to bring about the industrial regeneration that we need.
If the corporation fails to achieve its targets under the plan because of the uncertainties, the blame cannot really be laid at the door of the chairman. It cannot really be laid at the door of the unions. It will be laid where it rightly belongs, and that is at the door of this Administration.
7.59 pm
The Minister of State, Department of Industry (Mr. Norman Lamont)I beg to move, to leave out from "That" to the end of the Question, and to add instead thereof,
"this House calls upon Her Majesty's Government to continue to encourage the British steel industry to improve its efficiency and competitiveness in order to strengthen its overall health and profitability; and to pursue a successful privatisation programme for the British Steel Corporation."
Although I cannot support the terms of the Opposition's motion, I make no complaint about the choice of subject. Indeed, I welcome it. During the previous Session, and especially during the passage of the Iron and Steel Bill, the House had many opportunities to discuss the state of the steel industry and its prospects. That has not been possible during this Session. There have been a number of recent and important developments affecting the steel industry, and this is a useful opportunity for the House to consider them.
I should like to deal with three broad areas. First, and primarily, there is the British Steel Corporation—its financial, commercial and market situation, and the main problems. Secondly, there are the international developments, about which the hon. Member for Whitehaven (Dr. Cunningham) spoke, the progress being made on the European Community's agreements on steel and the recent developments in the United States market. Thirdly, there
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is the position of the private sector steel producers, including the action that is, being taken to help them restructure their operations. Those are wide subjects, and I shall be unable to cover every aspect of them now, but with the leave of the House I shall of course seek, when winding up the debate, to deal with other points raised in the debate.
If I may deal with the British Steel Corporation first, perhaps I could remind the House of the background. At the beginning of last year Mr. MacGregor described his survival plan for 1981–82 as "optimistic". That word was echoed by my hon. Friend the Member for Leeds, North-East (Sir K. Joseph) when he approved the plan in February. The plan certainly set ambitious targets for reducing costs, improving productivity and regaining the corporation's depleted market share. The financial objective for 1981–82 was to reduce the previous year's record loss of £668 million by more than half, and to do that within an external financing limit of £730 million—about two-thirds of the previous year's level.
By last December the plan's targets looked realistic and the corporation well on the way to achieving them. There were cost reductions, including plant closures and redundancies which were referred to by the hon. Member for Whitehaven. I do not dissent from what he said about the hardship that was caused in many communities. Many of those closures and redundancies were achieved ahead of planned dates. Productivity had improved in virtually all parts of the business, with some of the major plants—notably Port Talbot and Llanwern—reaching levels actually equal to the best of their European competitors. The corporation had regained its market share, almost exclusively at the expense of imports.
That is not to say that there had been no problems to overcome. Costs for raw materials had continued to rise. Demand for steel in the United Kingdom lagged behind the plan, which meant that the corporation had to keep its plants running at optimum levels by exporting more steel than planned, and some of that was to relatively unremunerative markets. Nevertheless, the efforts of management and work force to achieve the internal efficiencies and economies which lay under their own control broadly offset those adverse factors. As a result, in the half-year to September 1981 the corporation reduced its losses after interest to £196 million compared to £279 million in the corresponding period of the previous year and the situation continued to improve. That was despite continuing low levels of steel prices for most of the period.
By December the European measures to increase steel prices had begun to take effect, and the corporation believed that for the year as a whole it was on target to achieve the planned reduction in losses within the original external financing limit. It stressed, however—this is one of the major points—that this forecast depended critically on the European steel regime being effectively implemented in all its aspects, particularly the programme of price increases and of measures to bring capacity into line with demand. I want to say more in detail about the European measures. The point that I wish to underline is that BSC entered 1982 in markedly better shape than a year earlier.
Building on the solid achievements of 1981, in December Mr. MacGregor presented the Government with his new plan for 1982ndash;85. At the same time, he made it clear that it had to be regarded as provisional because of the new danger that action might be taken to close or

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severely restrict the United States market against steel imports. The corporation's concerns were twofold. First, it could stand to lose a valuable market.
The hon. Member for Whitehaven referred to some figures. Provisional figures for 1981 show that the EEC as a whole sent about 6 million tonnes of steel to the United States of which BSC accounted, not for 80, 000 tonnes, as he suggested, but for between 400, 000 and 500, 000 tonnes.
Dr. John CunninghamI realise that I was referring to figures for one quarter and not to annual figures. The Minister was right to correct me and I accept what he says.
Mr. LamontI did not wish to make a point against the hon. Gentleman, but it is extremely important that the House should be clear about the importance of the matter. It is not just a case of BSC losing access to a market. There is another fear, which is that the closure of the United States market, not just to BSC, but to other European steel producers, will disrupt and undermine the whole European price regime.
The fear was that protectionist measures would create even more surplus capacity in Europe and undermine the agreement on prices. In addition, third country exports could be diverted from the United States to Europe, so exacerbating the fundamental problem of surplus capacity. On 11 January a number of United States steel companies finally initiated anti-dumping and countervailing duty suits against West European producers. No one should doubt the seriousness of this development and the danger of creating a trade war from which no one will gain and everyone will lose.
Mr. Ian WrigglesworthThis is an important matter. Will the Minister clarify the figures? Is the figure of 400, 000 to 500, 000 tonnes a recently updated figure? The last figure that I saw was 300, 000 to 400, 000 tonnes.
Mr. LamontThat is the figure for 1981.
Mr. CrowtherIt would be serious if European steel exports to the United States were reduced dramatically, but does the Minister agree that if similar action were taken against third countries, from which exports to the United States have increased much more than those from Europe, a more serious problem would be created if those countries attempted to unload their surplus on the European Community?
Mr. LamontThe hon. Gentleman is right. Unfortunately, some action has been initiated against some third country suppliers, such as Spain and Rumania.
Against that background, Mr. MacGregor informed the Government on 12 January that he had to reassess both the outlook for the corporation for the remainder of 1981–82 and the basis on which the new plan for 1982–85 had been constructed. That review will not be completed before the end of the month.
The details of the complex law suits by United States steel companies are only now being received and assessed. It is too early to say precisely which products are covered. Moreover, the United States Department of Commerce has yet to decide which of the cases it will accept for investigation. Contacts are continuing between the
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Community and the United States Administration in an attempt to reach an understanding that will minimise disruption to traditional trade.
In the meantime, however, Community Industry Ministers meeting in Brussels on 13 January agreed unanimously that it was the United States recession rather than the volume or price of European exports that lay at the root of the United States steel industry's problems. They therefore agreed that the Community would work together to mount a robust defence against those actions. While I very much hope that an amicable settlement can be reached with the United States, the Government and United Kingdom steel producers are prepared to fight those legal suits hard, in concert with our Community partners.
Mr. D. N. Campbell-SavoursIs it not correct to suggest that the Americans are less likely to criticise our pricing policy if the subsidies go through the energy pricing system as against other subsidies which they may seek to identify in these actions? Is this not especially so as any subsidy that we may pay to help on energy costs would probably lead only to an energy price being paid by us which is no greater than that paid in the United States?
Mr. LamontI do not know whether the tactic that the hon. Gentleman suggests is the right one. Even if it were, I am not sure that it would be right for me to say. The United States Administration is not the only one that might cast its beady eye on subsidies which the hon. Gentleman suggests might be paid for energy prices.
In deciding to make a reassessment of his plan Mr. MacGregor also referred to other factors which have been reported in the press. The hon. Member for Whitehaven referred to the severe weather and to steel production in other countries. However, in other countries such weather conditions are not so exceptional as they are in this country. Arctic temperatures at Ravenscraig reduced output, while the plants, including the blast furnaces, at Port Talbot and Llanwern were literally buried in snow and came to a halt. As the hon. Gentleman knows, considerable costs are involved not just in the disruption but in the whole business of starting them up again.
The press has reported a range of figures for the losses. I cannot comment on those reports, because BSC has not yet completed its assessment of the cost to it of the weather. It is certainly premature to talk of increasing BSC's external financing limit for 1981–82 on the basis of the purely speculative figures that have appeared in the press, and BSC has made no such request to the Government.
Another extremely serious problem lies in the dispute at British Rail. BSC relies heavily on the railways to move raw materials into and finished steel out of its plants. There has also been a particular problem at Teesside. A docks strike at the port has been running since before Christmas. The dispute at British Rail has now compounded BSC's difficulty there. Stocks of finished steel are now at capacity levels, and this means that production has had to be reduced to keep running. This industrial action is already damaging BSC and, if continued, could lead to an increasing loss of output, which could mean markets lost and jobs put at risk.
I believe that the difficulties facing BSC, serious though they are, are capable of being resolved. The

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underlying position at BSC is now much stronger, given the great efforts, involving both management and unions, that have been made over the past 18 months to cut costs and improve productivity. Provided that this spirit of co-operation is maintained and that sensible solutions can be found for the current external problems facing BSC, there is every chance that BSC will become profitable by 1983.
Dr. Jeremy BrayThe Minister says that BSC will become profitable "by 1983". Will he be more precise and specify a date or financial year?
Mr. LamontDuring the course of 1983—I do not think that I can be more precise than that.
I come now to the international scene. In Europe, the arrangements agreed last June have three main planks—a phased and simultaneous increase in European steel prices, the abolition of State aids to the steel industry by the end of 1985, and the closure of excess capacity.
Price increases are a crucial element in the package of measures. Without them, the other two elements would be insufficient to restore the European Steel industry to profitability. I know that steel users in the United Kingdom are concerned about the speed and scale of the planned rises. But, first, United Kingdom steel prices have only just returned to and begun to exceed the levels which they reached in 1979, whereas the prices charged by the main United Kingdom steel-using industries have risen steadily and substantially over the period. We could not allow steel to continue to act as a subsidised input for the rest of industry.
Secondly, United Kingdom steel users should not be put at a disadvantage compared with their overseas competitors. In Europe the price increases are being implemented by all steel producers under the supervision of the Commission, and in markets outside Europe—in, for example, both the United States and Japan—prices have been consistently higher over the last few years than those in Europe, including the United Kingdom. Finally, BSC has made considerable progress in closing excess production capacity, in reducing its workforce, and in improving productivity.
The costs of that as the hon. Gentleman said, have been heavy and have fallen on the public purse. The Government are determined that a streamlined BSC should cease to be such a burden on the taxpayer. An inescapable consequence is that BSC's prices, and those in the rest of Europe, will have to rise to levels that give a reasonable return to efficient steel producers.
On the second element of the European policy—the phasing out of aids by 1985—the objective is agreed, but it will depend for its ultimate success on the other elements in the policy being implemented successfully, so allowing European steel producers to return to profitability and to free themselves from reliance on subsidies.
The third element of the policy—the closure of excess capacity—relates very closely to the Opposition motion. The Community's decision on phasing out State aids by 1985 ties the granting of any aid in the meantime firmly to a programme of restructuring and capacity cutbacks in the member States concerned. That is a policy which we fully support. I agree with some of the points that the hon. Gentleman made, and I am happy to repeat what I know was the line taken by my predecessor—that the United Kingdom steel industry has already borne its share of
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cutbacks and we now look to others to make comparable sacrifices so as to bring total capacity into line with demand.
The major United Kingdom interest lies in ensuring that the European Commission applies the State aid rules effectively and that member States abide by them. The House will be interested and pleased to know that the Commission is currently taking action against three States for procedural infringements—non-notification of aid in advance of payment and the like—but on the whole it appears that member States are now facing the fact that they have no option but to cut capacity if they wish to give further aid. That does not mean that the future of every steelmaking plant currently operating in Britain can be guaranteed for ever. There will still be a need to maintain and improve competitiveness, because others do not stand still. Productivity and competitiveness are moving targets.
I should like to take the opportunity to deny some of the wild rumours that have been put around—for example, that the corporation has some secret plan to close Scunthorpe. This story has absolutely no foundation.
Mr. Michael BrownI do not wish to detain the House, and I shall be seeking to catch your eye later, Mr. Deputy Speaker, but can my hon. Friend confirm that the story that appeared in The Guardian relating to the steelworks in my constituency was in no way a kite-flying exercise by the British Steel Corporation, as those inclined to believe the story have suggested?
Mr. LamontI can give my hon. Friend the assurance that he seeks. It was not kite-flying. The story in The Guardian has no foundation.
There have also been persistent claims that steel capacity reductions in the United Kingdom, especially those by BSC, have already been taken to the point where the United Kingdom steel industry will be unable to meet any upturn in demand. These claims have been examined by the Government and by a number of bodies, including the Select Committee on Industry and Trade and the iron and steel sector working party. We do not believe that they stand up under such examination, since the general range of forecasts indicate that steel consumption in the United Kingdom will be between 12 million and 13·5 million product tonnes in 1985. That is equivalent to a requirement for liquid steel of between 16 million and 18 million tonnes. Assuming that imports and exports continue to remain in broad balance, BSC's current manned capacity of 14·4 million tonnes, coupled with private sector capacity of about 4 million tonnes, will be adequate. Moreover, these capacity figures take no account of the fact that BSC retains over 3 million tonnes of reserve capacity, which could be brought back on stream in the event of a sustained increase in demand.
Mr. CrowtherWill the hon. Gentleman give way?
Mr. LamontI shall give way in a minute. As to claims that an unforeseen and permanent upsurge in demand would create a shortage, I refer the House to the fourth report of the Select Committee on Industry and Trade, of which the hon. Member for Rotherham (Mr. Crowther) is a member, which dealt with BSC's 1981–82 corporate plan. In paragraph 22 it concluded that
"we tend to discount the concern of those who fear that the corporation's capacity will be insufficient, either for the prospective demand or in the event of demand being higher still as a consequence of an upsurge in activity in the economy."
Mr. CrowtherHow long does the Minister think that it will take to bring back into production the plants that have been mothballed?
Mr. LamontI understand that some plants could be brought back into production within months. There is no point in bringing them back into production when there is no demand. The corporation's policy must be to run the plants that are in operation at their maximum level of capacity.
Dr. BrayWhether BSC will be able to meet capacity and demand depends upon the pattern of that demand. Does the Minister agree that there are types of demand, particularly for plate for gas pipelines or for the Channel bridge, which, if they came in a rush, could not be met? The capacity to meet such peaking of demand and the possible consequent loss to British industry and export opportunities worry us.
Mr. LamontThat is right. Demand is not amorphous. It relates to particular products and means the taking of particular decisions. The corporation must judge. The corporation believes that it has adequate capacity to meet foreseeable demand and that some of the reserve could be brought back.
I deal next with the private sector of the industry, which is not mentioned in the Opposition motion. The Government are anxious to see it return to health and profitability. The private sector has a key role to play in the industry and must be encouraged—and helped—to overcome its present difficulties.
For the private sector, as for BSC, over-capacity has been one of the main problems. For this reason the Secretary of State announced last month a new £22 million scheme of assistance under section 8 of the Industry Act 1972. This will help not only with the costs of further closures, but with the costs of reorganising and making efficient the businesses of companies which have already reduced capacity or which now decide to do so.
We have already had preliminary discussions with a number of companies about possible applications under the scheme. The scheme, however, only supplements other measures which the Government have already taken or are actively promoting to help the private sector.
The Government, for example, continue to support the creation of joint ventures between the British Steel Corporation and the private sector, involving the merger of assets into new Phoenix companies, managed and financed as private companies. The first of these, Allied Steel and Wire Ltd., was created last July by combining the wire and rod interests of BSC and GKN. This measure of privatisation has been relatively little remarked upon although the new private sector company will be a significant force and is now one of the strongest wire and rod companies in Europe. We intend that there should be further companies of that kind. Active discussions are still in progress on a second Phoenix venture in the engineering steel sector which could involve the Round Oak steel works and GKN plant at Brymbo and Wrexham.
We recognise that Phoenix-type companies may not always provide the answer where there is an overlap between BSC and the private sector. The Government have recently commissioned an independent review of the cold-rolled narrow steel strip industry, in which both BSC and a number of independent producers are taking part. We would be prepared to carry out similar studies for other
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sectors of the industry, in order to assist rationalisation. The aim of such studies is not to impose a solution. The initiative for forming proposals will remain with the companies themselves.
The Government are, of course, always prepared to look at other ways of helping the private sector. For example, following Sir Frederick Warner's report on the special steels sector the Government, in conjunction with the British Independent Steel Producers Association, held discussions with the Commission last October. As a result of these discussions the Commission recognised the particular problems of the United Kingdom industry and subsequently recommended a 10 per cent. increase in special steel prices from the beginning of this year. Similarly, following complaints from the private sector about unfair price cutting by BSC, the Government took up the problem with BSC. As a result the chairman undertook to investigate personally every complaint. I understand that private steel makers have found this procedure useful.
We believe that with such financial and practical help from the Government, coupled with the other measures being taken at both national and Community level to promote restructuring of the steel industry and a more competitive environment, the British private sector will be able to reorganise itself so as to be able not only to survive but to prosper.
The United Kingdom steel industry certainly faces problems. There is no escape simply by setting our face adamantly against any closures or job losses or against co-operation with our Community partners. We all want the largest steel making industry that can efficiently supply markets at home and abroad. Management, work force and the Government have to work together to achieve that.
The history of BSC for too long has been one of political interference, of difficult decisions constantly deferred, with the consequences becoming graver, especially for the work forces. They have suffered most of all. We have had to learn the hard way, but at least we have made progress in the last year—more progress perhaps than anyone might have dared to hope. Parts of BSC are now equal to the best in Europe. The corporation now has some hope. Let us not throw it away by returning to precisely the mistakes that created the problem in the first place.
8.28 pm
Mr. Stan CrowtherI was pleased to hear the Minister of State emphasise that the British Steel Corporation had recovered its market share at the expense of imports. Many hon. Members have become a little tired during the past 12 months of hearing Conservative Members constantly attributing all the problems of the private sector to allegedly unfair competition from the BSC. From an examination of the facts, it is clear that the real enemy of the private steel sector in Britain was the enormously high level of imports. In fact, the products on which, in recent years, the private sector has taken the hardest knocks in the market are precisely the products into which the level of import penetration has been highest. Therefore, I was pleased to hear what the Minister said.
The main problem for both the public and private sectors of the steel industry lies with the Government's policies. At the heart of the problem is the enormous reduction in demand within the United Kingdom because

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of the piling of deflation upon deflation, coupled with the burden of energy prices and the Government's failure to safeguard the interests of both the public and private steel industry against the considerably subsidised competition from foreign producers, especially the producers of various special steels and stainless steels.
When the Minister referred to the recent decision of the Council of Ministers to phase out State aids to steel, he omitted to mention that the Ministers had left out a variety of indirect State aids that European steel industries receive but which the British steel industry does not receive. I referred to this matter at some length during the debate on 28 July. I mentioned particularly the case of the West German railway subsidies which benefit the West German steel industry by almost £400 million a year. Those subsidies will continue. Therefore, the British steel industry will continue to be at a disadvantage against subsidised competitors in Europe. I am sorry that the Minister feels that everything from now on will be much smoother, because I am convinced that it will not be so.
I do not understand why the Government have tabled an amendment about denationalisation. The Minister did not offer any ways in which denationalisation would benefit that part of the steel industry which, at present. is controlled by the BSC. Denationalisation would do nothing to solve the present problems. There may well be a case for further rationalisation, but there is no merit in the new joint companies, the phoenix companies, being part of the private sector. It would lead to much greater order and efficiency in the industry if any new joint companies were part of the public rather than the private sector. The hiving off of valuable pieces of the BSC into the private sector will merely make the remaining parts of BSC more difficult to operate.
In any event, whatever happened in the way of rationalisation, the real problems cannot be tackled in that way because the heart of the difficulty is that Britain, alone among all developed countries, has a Government who are not prepared to lift a finger to create the conditions in which home industries are able to compete on equal terms with foreign producers. Until that happens and until we have a Government who will do something to look after their own industries, these problems will remain unsolved for both the private and public sectors.
I am sorry that there have been attempts on the Government side over the past year or two to create a totally artificial antagonism between people in the private steel sector and those working for BSC. The objective of the Labour Party and of the trade unions is to see both sectors of the steel industry restored to health.
I appreciate entirely the difficulties that face Mr. MacGregor, who, unlike his competitors in Europe, has to deal with a Government who are not only antagonistic to the whole concept of a publicly owned steel industry but doctrinally opposed to using the very considerable machinery at their disposal to create conditions which are helpful to their home-based industries. Not only Mr. MacGregor but the private sector, is faced with the problem created by the effects of deflation on the steel industry's main customers in Britain—for example, the motor car industry and other major steel users. Yet, at the same time, it gets no Government support against the intense international competition from countries whose Governments have a totally different attitude.
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Therefore, it is against this background of sympathy and understanding of the problems of Mr. MacGregor that I shall now be somewhat critical of what has happened since the corporate plan was agreed.
When the corporate plan was first debated in the House in December 1980, I concluded my short contribution by saying
"Mr. MacGregor may find himself, at the end of the day, in the position of the surgeon who said 'The operation was a complete success, but unfortunately the patient died, '"— [Official Report, 16 December 1980; Vol. 996, c. 285.]
I agree with the Minister to the extent that the patient is not yet dead but I am nothing like as optimistic as he is about the prognosis. It seems to me that the patient is at least suffering very severely from the fact that the surgery has been much too drastic. There is no doubt in my mind that the cuts have gone much too far. My hon. Friend the Member for Whitehaven (Dr. Cunningham) was right in that respect.
There was a long discussion about this point when Mr. MacGregor talked to the Select Committee on 11 March 1981. We discussed all the matters that had rendered the British steel industry uncompetitive. At the end, I put it to Mr. MacGregor:
"If there were substantial changes in all of these matters we have been talking about:. that is, exchange rates, energy prices, Government policies towards coking coal, R & D, et cetera would it not result in your becoming very considerably more competitive and also your customers becoming more competitive so that you can then expect a bigger share of a bigger United Kingdom market?"
Mr. MacGregor replied:
"Of course, that is true."
I asked:
"And are you equipped to meet it if it happened?"
He replied, "Yes, sir." The events have proved that he is not equipped to meet it. There has been a very slight change from the point of view of improved British exports resulting from the rate of exchange of sterling. There has been a slight upturn in demand. It may be temporary but it has been an upturn. Immediately, however, the BSC is in difficulty. The corporation is already unable to meet all the orders that are available.
My hon. Friend the Member for Rother Valley (Mr. Hardy) and I have been involved in lengthy correspondence with Mr. MacGregor on the matter which hits particularly the Rotherham works. My hon. Friend has asked me to make it clear that what I say reflects his views as well as my own. The steel-making capacity of the BSC has been cut to the point where the potential for recovery has been seriously jeopardised.
It would take up far too much time to quote all the evidence that I possess. I shall cite just one example. hope that the Minister will respond. I wrote a letter to his right hon. Friend that I trust he has seen. Towards the end of last year, the Thrybergh bar mill at Rotheram works, a marvellous piece of advanced steel technology and a mill that has broken world records, was on short time, not because of lack of orders—there was a full order book—but because of a lack of billets.
The reason for the shortage was that the works had received an attractive and profitable order from an outside customer. The management had decided to meet the order and to keep the Thrybergh mill short of billets until the order was completed. I do not criticise the commercial decision that the management made. I criticise, however, the fact that it had to make that choice. The steel-making

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side of the works was not able to supply both an outside customer and its own mill because the capacity had been run down too far.
The Secretary of State has said three times, twice in this Chamber and once in the Select Committee, that the BSC can increase its output by up to 20 per cent. without any increase in capacity. If that had been so, the situation I have described would not have arisen. The fact is that the BSC cannot increase its output to meet the slightly increased demand. I could quote many cases of the BSC's own departments in Rotherham and elsewhere having to import steel because the billets or slabs that were formerly obtainable within BSC are no longer available as a result of steel-making capacity being reduced too far. I could give those examples if there was time.
I was given positive assurances on all those matters by Mr. MacGregor, who said that, at the end of the corporate plan reductions, capacity would be adequate to meet any increase in demand that might occur. As recently as 25 November, he said to the Select Committee that there was no increase in demand. He said, again in response to a question from me:
"We are not turning down orders. There has been no upturn in demand. The underlying demand is declining, if anything."
A few days ago I received the steel industry's statistics issued by the British Steel Corporation and BISPA on 15 January. The document says:
"production in the last six months of 1981 at an average of 291, 200 tonnes a week, was 20·4 per cent. up on the figure for the corresponding period of 1980."
That is the half year during which Mr. MacGregor was assuring the Select Committee that there was no increase in demand. A week or two later, the Secretary of State said very much the same thing. If that is not an increase in demand, I do not know what it is.
I accept that that is not decisive, because I admit that the half year with which it is compared—1980—was a period of exceptionally low demand. I understand that. However, even when there is a slight improvement in demand for BSC's products, the BSC has, because of the pressure imposed on it by the Government and the EEC Commission, deprived itself of the ability to meet even this modest improvement in the demand for its products without much serious difficulty.
In view of that, if we ever get a change of Government policy, for example, on energy pricing or on general economic measures, which improve the position of the steel industry's customers—the motor car industry, the construction industry or shipbuilding—there will be a substantial upturn in demand for British steel, and bearing in mind that the BSC, according to Mr. MacGregor's own figures, is already operating its manned capacity at 98 per cent. utilisation, that increase in demand will not help the BSC. It will go to foreign companies in Europe which, as the Minister himself agreed, and as my hon. Friend the Member for Whitehaven said, have not reduced capacity in the way that we have done and are able and ready to meet and respond to an increase in demand very quickly and efficiently.
I hope that we shall have fewer bland assurances from the Secretary of State and an acceptance of his own responsibility as the sole shareholder of this vital public industry, as the custodian of the public interest, because
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it is his job to ensure that the industry is kept or put into a more efficient condition, and that it is not allowed to be run into the ground, as is now happening.
Several Hon. Members rose—
Mr. Deputy Speaker (Mr. Ernest Armstrong)Order. It may help the House if I say that 10 hon. Members are trying to catch my eye. We hope that the Minister will make his reply in under 80 minutes' time.
8.43 pm
Mr. Michael MarshallI shall do my best to be brief. I am glad to follow the hon. Member for Rotherham (Mr. Crowther), who has been a regular attender at steel debates in recent years. As I look around, I see the regular cast, as it were, on parade. I am glad of that, because we can at least claim some continuity in the House in debating these great issues.
The motion is rather remarkable. It highlights the attitudes of the Opposition. I hope that if, the spokesman for the Social Democratic Party, the hon. Member for Thornaby (Mr. Wrigglesworth), catches your eye, Mr. Deputy Speaker, we shall hear what he has to say, because his party's amendment contains a point of view on which I shall express a view in a moment.
The remarkable aspect of the Opposition motion is that it betrays a certain industrial illiteracy. The notion that one could in any way talk about freezing capacity and manning levels does not bear examination. In fairness to the hon. Member for Whitehaven (Dr. Cunningham), he did not seek to pursue the terms of his own motion. To be fair, he said a word or two about manning levels and he said that slimming was on target, but at no stage in his speech did I detect any reference to the level of capacity, the anticipated market or anything relevant to the motion in that sense. However, the hon. Gentleman did us a service by raising the issue of capacity, because it leads us to reflect on the build-up and background of the British Steel Corporation.
Labour Members bear great responsibility, because the Labour Party brought the industry into State ownership. Labour Members will recall that at the time of nationalisation, the 13 largest companies, with a capacity of over 1 million tonnes, were brought into the State sector. There is not one Labour Member who would defend the industrial logic of that decision. It was transparent nonsense, because it used crude capacity and did not relate products where product rationalisation might have been effective. If I were a nationaliser—which heaven knows I am not—I could have made a better fist of it. No Labour Member would be foolish enough to defend the concept. It was a crude political move, taken without any study of the industry and we are living with the result.
What happened? The industry was not rationalised. However, if 13 companies with common services and, often, common market interests are brought together, rationalisation is essential. Instead, the arguments turned on centralisation, decentralisation, the interface with Government and all the resulting problems. The Conservative Government had to try to pick up the pieces in the 1972 plan for the industry. The closure review suggested by the Labour Party in 1973–74 when in Opposition was carried through when it came to office.

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The net result was no change. All the closures proposed in the 1972 review sadly had to be made. They were only delayed.
Therefore, the problems of today built up over all the years of constant political intervention, which made it more and more difficult for market realities to relate to capacity in that great industry. That is why we should remember, when relating capacity to known markets—my hon. Friend the Minister immediately put his finger on the problem—that it is difficult to make judgments and that we must have some faith in the abilities of management and trade unions to reach agreements that are relevant to the industry's needs.
The corporate plan was a high-risk strategy and the hon. Member for Whitehaven was right when he spoke about the European Community. That high-risk strategy is poised on a knife edge of continuing to get acceptance in Europe on prices and on balancing capacity. When the hon. Gentleman discussed the problems created by the situation in America he did the House a service. I hope and believe that we can join hands in expressing our concern about an important development that could once again, cast adrift the viability of international steel making.
When I last considered the figures—I do not suppose that the proportions have changed—the percentage of United Kingdom exports to American steel distributors was less than half of 1 per cent. In some important areas, such exports are traditional and significant business, but their level must he borne in mind. Therefore, it is nonsense to suggest that any of our steel suppliers' activities disturb trade in the United States of America. Over the years there has been a tendency to look at British Steel, because it is State-owned and to say that it is, by definition, being subsidised and is therefore an obvious target. Given all the changes in the past few years, we are in a strong position to say that that is not a fair charge. Given the background that I have tried to sketch in briefly, it is unreasonable for the American Administration to consider Britain as a target for attack in terms of its international steel trade.
The hon. Member for Whitehaven raised three points that need answering. He spoke about the rate of closure being faster in Britain than within the European Community as a whole. The reason was that we postponed closures that could have been carried through during the years when the industry was profitable. Instead, we continued with manning and capacity levels that were not justified by the market at the time, as a result of which the industry came under far greater pressure when we ran into recession in 1975.
The hon. Gentleman said that there was an imbalance in the steel trade with other EEC countries. Again, it is fair to ask why. He tried to suggest that no blame should be attached to the trade unions. It is not a question of blame, it is simply a matter of fact that once we had the steel strike, the bare obvious fact that we had a monopoly supplier came home to every steel user. Many users have now changed to second sourcing, and in a free society those markets are lost for ever. They will not return. The steel users have got used to the idea of an alternative source of supply.
The hon. Member for Whitehaven also referred to the competition between the public and private sectors. Once again, I remind him that this largely stems from excess capacity. Had the streamlining gone ahead at the time when the interface between public and private would have
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allowed it to do so on a more reasonable basis, I do not believe that the problem would be anything like as great as it is today.
While I welcome the fact that my right hon. and hon. Friends have done something to help the private sector, there is no question but that the private sector has faced unfair competition on rationalisation throughout these years because it had no effective recourse in bankruptcy, whereas the BSC was protected. Those are the facts of life when we talk about capacity, and that is the difficulty we still face today.
I assume that the amendment that has not been selected represents the SDP point of view. I welcome the fact that the SDP seems to be taking a line that is broadly consistent with the Government's view. Their amendment seems to support a more profitable industry that is in touch with likely and future demand, which is similar to the case that I am putting forward.
I am glad to see the hon. Member for Thornaby in his place. On some occasions I have heard him make noises about privatisation, of which the hon. Member for Rotherham spoke. I hope that the hon. Member for Thornaby will make his party's position plain. I urge him to think carefully about the merits of the so-called BP approach—Phoenix 1 that we have already seen developed. Surely that is a way of defusing part of the political argument. I would have thought that any mixed economy politician would be prepared to give that kind of activity a real opportunity, not just because of privatisation but also because it provides access to the capital market when public expenditure resources are finite.
To answer the point made by the hon. Member for Rotherham, I believe that such an approach enables us to create an environment of management and work force commitment in an internationally competitive manufacuturing industry. The hon. Gentleman and I may differ fundamentally over the purpose of nationalisation, but, given his experience, I am sure that he recognises the great difference between State enterprise that must compete internationally and others that compete in a purely domestic way. That is part of the argument that ought to be fairly examined.
We have a chance to make these comparisons and we shall see whether my words are borne out in practice. Having heard the hon. Gentleman on the radio and elsewhere, I urge him to set aside his natural gut reaction of saying "We shall not go further down this route". Let us see whether this argument finds favour across the House, because it would be helpful to those who work in the industry if there were a measure of continuity and stability.
I prefer the practical and pragmatic approach reflected in the Government's amendment. The Minister of State said that the liquid capacity of about 16 to 18 million tonnes—half that projected in the steel plan of 1972—contains a reasonable reserve capacity. If there were time, I should like to debate the reason for that capacity. There is, of course, finishing capacity and primary capacity and, if an upturn comes, an opportunity to drive the plant faster.
A great tragedy of the British steel industry in recent years, especially the British Steel Corporation, is that it has never been run at full capacity. Therefore, improvements in efficiency and the ability to earn have not been demonstrated. The industry has not shown what it can do. However, we are now seeing an industry much more

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in balance with demand. It has a chance. It is a tragedy that recent events and the weather have caused a hiccup. However, the balance is crucial and I am glad that the matter has been raised this evening.
It is always difficult to be angry with the hon. Member for Whitehaven. He does his homework and is always balanced and moderate. His right hon. Friend, the right hon. Member for Salford, West (Mr. Orme) is also likeable. However, they are both guilty men. They were members of an Administration that passed the buck on the question of capacity and that allowed the industry to reach a position where the problems have become much more traumatic and much greater for all who work in it and for any Government that must try to help. That is why I reject the motion and will go happily into the Lobby behind by right hon. and hon. Friends.
8.56 pm
Mr. Ian WrigglesworthThe hon. Member for Arundel (Mr. Marshall) tempts me, by the early part of his speech, to go down the road of reviewing the history of the British Steel Corporation, because he mentioned only the period from 1968 onwards. As he is a reasonable man, he will not claim that before 1968 there was no need for rationalisation in the private facilities that were available in the British steel industry. If time had permitted, I would have wished to say something about the history of the corporation, because no industry has been damaged more by being a political football. Some political lessons can be learned from studying the history of the iron and steel sector from 1949 onwards.
I do not want to take too much time in this short debate, so I shall refer to some of the immediate problems facing the steel industry. I begin by saying how much I welcome the opportunity to have the debate at such a crucial time, when the corporation must review the prognosis that it gave to the Government and the House in the corporate plan. It is disappointing that the plan must be reviewed in such a way. I wish to reiterate what other Opposition Members have said and place a substantial part of the blame for the review on the Government. The demand in the economy has been depressed for an unprecedented period at unprecedented post-war low levels. That has been sustained for some time. Not only has the British Steel Corporation been hit by that lack of demand, but an industry as basic as the steel industry inevitably is hit hard by it.
The future of the steel industry was dangerous when those forecasts were made. Narrow margins were involved and there was the possibility of its being buffeted off course by international action. Also, because of the low level demand in the economy, it is not surprising that developments in the United States of America and the Common Market and the recent weather conditions have led to the review.
However, one should not leave the current state of affairs, considering the past two years, without paying tribute to the success that the corporation management and staff have achieved. It has been achieved at a very high price.
I represent an area that has one of the largest iron and steel-making capacities in the country. We have had thousands upon thousands of workers made redundant in recent years. Hon. Members who represent steel areas that
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have experienced high unemployment know of the personal suffering caused in family after family. We should not discount that aspect when considering the need for increased productivity and for making our industries internationally competitive. A price has to be paid. I hope that the Government will take action about the general demand in the economy and will in the forthcoming Budget respond to pressures from hon. Members to overcome the problems by reflating the economy.
One such suggestion has come from the BSC. It is a bold and imaginative proposal for a Channel crossing. I hope that the Government will give it a fair wind. The proposal could also give an enormous boost to other sectors of British industry and so increase employment.
Mr. Campbell-SavoursThe hon. Gentleman says that the BSC has put forward a proposal. Which scheme would his party support?
Mr. WrigglesworthAll hon. Members will have seen the BSC proposition. I find it attractive. I believe that the Government should seriously consider it. I have not yet been able to give technical appraisal to my colleagues of the schemes on offer, but if the hon. Gentleman is patient he will learn of the policy proposals on which we are working and can debate them with us.
I wish to deal particularly with the problems from overseas facing the BSC. I agree with the comments made about the action of the United States steel producers. If the action succeeded, it would immensely damage world trade, way beyond the iron and steel industry. It might lead to repercussions and edge us closer to a trade war in a way most damaging to the world economy in its weak state. I hope that the United States Government and steel producers will consider the damage that could be done to their trade and to world trade if they proceed and succeed.
The United States should also understand the resentment on this side of the Atlantic. For a long time producers there have had the benefit of cheap energy, which particularly in this country we did not have. They criticise us for possible subsidies to our producers, but over a long period their cheaper energy prices have made it difficult for many industries fairly to compete with them.
I also agree with the comments about the need for fair treatment within the European Community. Existing capacity has been maintained and, indeed, increased in some other EEC countries. Belgium, Italy, Holland and Luxembourg are still increasing capacity, which is unacceptable when we have had to make massive reductions in a short time. Part of the reason for the reduction may have been that the massive over-capacity should have gone earlier, but it is unfair to put a greater burden on our industry when other EEC countries are obtaining aid and increasing their capacity. I hope that the Government will strongly press on the European Community the need for Belgium and other countries to match Britain's cuts in capacity and to bring the available capacity into equilibrium with the market.
In response to the hon. Member for Arundel, I shall say something about the amendments and the motion. The hon. Gentleman and the Minister said that it was impossible to freeze numbers and capacities as though world changes did not occur. The Minister commented that productivity was a moving target, and I believe that that is true. One cannot say that new capacity should not be put in and old taken out in order to modernise and that

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one should be unable to respond to the state of the market at any time. We should be looking for ways of increasing competitiveness and thereby assuring people of their jobs and reassuring industry that it will have a future. That can be done by looking ahead imaginatively and not resisting any change.
The Government's amendment is defective in its final sentence. I became even more worried about that when I heard the Secretary of State this afternoon. It is unnecessary to hark back to old, damaging, ding-dong debates between the two old parties by talking about the pursuit of
"a successful privatisation programme for the British Steel Corporation."
Neither I nor my party has any objection to the sort of joint ventures that the hon. Member for Arundel referred to. Such ventures have already begun to make a considerable contribution, which is welcome. However, I do not know whether hon. Members noticed that the Secretary of State said, during Question Time, that there was no reason why the steel industry should be a public sector company. I wonder whether that remark and the Government amendment mean that it is their intention to denationalise the BSC when it again becomes profitable.
If that is the suggestion, we will return to the same dingdong battle as we have had in the past, with counter proposals from the Opposition Benches and uncertainty about the corporation's future. Equally, it is nice to have the assurance of the hon. Member for Rotherham (Mr. Crowther) that he supports the joint ventures—as does the ISTC. I am not in the least surprised to hear that, knowing the hon. Gentleman and the ISTC, but there are many others in the Labour Party who would not agree for one minute with that proposal. The question is what the Labour Party's policy will be at the next election. Will it be in favour of one thing or the other?
Mr. Campbell-Savours rose—
Mr. WrigglesworthI shall not give way because many hon. Members wish to speak. That is exactly the sort of uncertainty that has so damaged the steel industry throughout its post-war history and I hope that the tone of this debate will be reflected in policy statements and actions from the two old parties in future.
Mr. Campbell-SavoursWill the hon. Gentleman give way?
Mr. WrigglesworthNo, I shall not give way because I must draw my remarks to a close. Capacity and demand in the economy are two major problems facing the House and the country. It is worrying that the capacity of the steel corporation faces possibly even further reduction. I am horrified at the prospect of its being reduced from 14·4 million tonnes to the suggested 12·6 million tonnes.
Like other hon. Members, I wonder how small an industry we can maintain without losing the benefits of productivity and undermining the national asset that any major industrial country must have.
The second major factor is the level of demand in the economy, to which I referred earlier. I urge the Government to realise that the problems facing the management and workers of the BSC and many other industries could be relieved if the Government took the advice of their Back Benchers and other hon. Members and introduced a reflation on capital projects, partly in the public sector and partly in the private sector. That would
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aid not only the steel industry but the many unemployed, some of whom have been thrown on the dole queue by the reorganisation within the BSC over the past two years.
9.11 pm
Mr. Michael BrownI cannot remember how many steel debates have taken place in the House since I became a Member, but there have been many, and it is pleasant to see what my hon. Friend the Member for Arundel (Mr. Marshall) referred to as the "regular cast" taking part.
It says something for my hon. Friend's knowledge of the industry that, even though he does not have the burdens that he once had, he can use his considerable knowledge and experience, not only as a Minister, but as a former active steel maker and producer, to help us in our debates.
The debate is unique for me, because I have agreed with nearly everything said by every hon. Member on both sides of the House. The hon. Member for Whitehaven (Dr. Cunningham) said that he had misgivings about recent reports that the corporate plan might need to be substantially reviewed because of recent weather conditions. Many of us, on both sides of the House, who represent steel constituencies would regard it as unacceptable for a significant review of capacity or manpower to be made on the excuse that the BSC had been knocked off balance by severe weather conditions in 1981–82. We should not determine the future of that national asset on the basis of poor weather over two or three weeks.
I was pleased to hear the Minister denounce the malicious and wild rumours about the BSC plant in my constituency. The House can imagine the horror and panic—I use those words deliberately—created in the steel community in my constituency when reports of the rumoured closure of the Scunthorpe plant appeared in The Guardian. That was the signal for wild and irresponsible people to take advantage of the fact that they have ready access to the columns of the influential local press, which added to the panic.
No good came of that incident. The plant has been doing extremely well in the past year. I have supported Mr. MacGregor and the Government in their efforts to bring demand and capacity into balance in the past two years. I have done so because the prospect of bringing the two into balance holds out the greatest possibility of a guaranteed future for steelmaking at Scunthorpe. It is because I believe that there is a future for steelmaking in Scunthorpe, and because I want to safeguard the remaining jobs and capacity, that I supported the measures that had to be taken in 1979, 1980 and 1981.
The recent rumour that so unnerved and unsteadied my constituents showed the depth of feeling in Scunthorpe. In a short period the town has lost about 8, 000 jobs, so that the level of manpower has been dramatically reduced., if not with the acceptance, with the tolerance Of the trade union movement, which has done its best to bring the new manpower figures into effect. Judging by the reaction of the Scunthorpe steel community, it would be intolerable if yet further burdens were imposed on the community, especially when the future for the steelworks has never been brighter, when measured by the profit and toss account for the works over the past few months.
The Minister and, if he is listening outside, the chairman of the British Steel Corporation, have both received my ready support in the past for ensuring that

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what had to be done was done as speedily as possible, notwithstanding the short-term social consequences in my constituency. I hope that they will recognise that my constituency could not accept any further burdens, such as a substantial reduction in capacity, of the sort that we have had in the past three years.
The recent scare was worsened by the irresponsible minority who have a vested interest in closing down the Scunthorpe steelworks. There are one or two people in Scunthorpe who claim to be trade unionist representatives, but they do not represent the vast, responsible body of trade union members that we have, not only in Scunthorpe, but throughout the whole steel industry. These people do not have the best interests of the Scunthorpe steelworks at heart. They want the plant to close, because that is the way in which their political careers will be furthered. As the Member of Parliament for Brigg and Scunthorpe, I am aware of their game. Sometimes the honest local people are taken in by what they say. When somebody who claims to be a trade union representative claims that the local steelworks will close and there are banner headlines in the local paper, people are bound to wonder. Therefore, I am grateful to my hon. Friend for his assurance.
I hope that that assurance will extend beyond the end of the month, when the Minister said that the Government would receive the completed corporate plan review. It would be intolerable if, having had the unqualified assurance which the Minister and Mr. MacGregor have given to Scunthorpe today and in the past week, we found that there was something untoward in the revised corporate plan. I hope that the assurances given today will hold water when we know the results of the revised plan.
I have seen the benefits to Scunthorpe of the strategy behind the corporate plan. To some extent I agree with some of the technical arguments advanced by the hon. Member for Rotherham (Mr. Crowther). He said that his local steelworks were suffering some difficulty because of the upturn in the market. The debate has shown an interesting situation. Fears are being expressed by the Opposition that the British Steel Corporation may not be in a position to respond to an increase in the market. It is a sign of their confidence in the Government's policies that they recognise that increased demand may be forthcoming.
As the hon. Member for Rotherham said, there are substantial orders coming the way of the Rotherham and Scunthorpe steel works. There are hiccups, as those works have to adjust to the new capacities. That shows—this applies to Rotherham and Scunthorpe and perhaps to South Wales—that the "Alamein line" of 14·4 million tonnes capacity, which has been referred to by Mr. MacGregor, has to be defended. All the indications are that the economy is likely to show a considerable upturn, notwithstanding the fact that demand for steel products is still sluggish. The half-yearly statistics for steel deliveries produced by the corporation and the British Independent Steel Producers Association show that there has been a substantial increse in demand for steel products over the past six months. The hon. Member for Rotherham referred to that in some detail. For that reason it is important to ensure that manpower in the steel industry and the level of capacity are defended.
It is generally recognised—I think that everyone in the House will accept that I was among the first to recognise
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this, having been prepared to support the corporation and the Government, even though there have been short-term adverse social consequences for my constituency—that the industry is chasing a moving target. We must ensure that it can always keep pace with that target. As the hon. Member for Thornaby (Mr. Wrigglesworth) rightly said, it is important, now that we have overcome the major problems that the industry faced in the 1970s, to try to think ahead, to read the market and to take advantage of new technologies.
I do not want to dwell on the United States market and the relationship between that and the European Economic Community. I can honestly say that I agree with every word that every other hon. Member has said on that issue.
As signatories to the European Economic Community agreement on the phasing out of steel aids by 1985, we all recognise that Britain has a responsibility. However, even if other EEC countries obey the agreement to the letter, they will still be at an advantage over the United Kingdom because of hidden subsidies, especially on energy and freight in certain countries. There is no doubt that that applies to freight in Germany. I hope that in the continuing negotiations on steel aids within the EEC my hon. Friend will recognise that some of us have to work as Members of Parliament in steel constituencies, where local managements are assiduous in drawing to our attention unfair hidden subsidies, which do not always get caught by agreements that are signed in the EEC.
9.24 pm
Mr. Roy HughesI welcome the debate, although it is brief. I recall our last major steel debate. At that time the right hon. Member for Leeds, North-East (Sir K. Joseph) was casting a shadow over British industry, with all the despondency and gloom that resulted. One felt that at the time of the disastrous national steel strike a little statesmenship at an early stage from the Department of Industry could have averted that strike.
What both sides of the House can agree upon now is that the industry has been considerably slimmed down. Production capacity has been reduced to 14·4 million tonnes. One can only reflect that a decade ago it was approximately double that figure.
I agree with the point made by my hon. Friend the Member for Rotherham (Mr. Crowther) that if and when there is an upturn in the economy, we could be quickly importing large quantities of steel, with all the disastrous long-term consequences that that would have for British industry, particularly the steel industry.
We know that in recent years the work force has been reduced to just over 100, 000, with all the anguish and despair that that has caused to steel communities up and down the country. Now we know that BSC has plans to reduce the labour force by a further 12, 000. This afternoon the Minister of State, in reply to a parliamentary question that I asked, said that the investment plans of British Steel were to be reassessed. That will be worrying for steel workers and their families.
Steel was once a predominant industry in Britain, which was a major steel producer. Now the United Kingdom is reduced to producing less than 2 per cent. of total world output. That is the measure of the decline of that great British industry. Ours has been a dramatic decline, more so than in many other countries in Western Europe. Until recently Spain and Italy have been steadily increasing their capacity. Naturally, Britain and the steel industry are

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badly affected by the slump. The industry is also affected by the restrictionist and deflationary policies of the Government. There is now fresh anxiety in the steel industry.
We had the snow crisis. I am vividly aware of that because I am a South Wales Member. It badly disrupted production at three major plants, two in South Wales, at Port Talbot and Llanwern, and Ravenscraig in Scotland. Each day that those plants were out of action, losses were incurred by BSC, running to millions of pounds. However, at least the weather is a short-term problem. Major plants such as the ones that I have mentioned can recover output quickly.
The other threat that has been mentioned several times in the debate is the fact that eight steel companies in the United States are to file anti-dumping suits. The fines that could be imposed are worrying to British Steel. At least Mr. Ian MacGregor, the chairman of the British Steel Corporation knows the American situation well. This action in America could damage the export trade of the BSC.
Secondly, if the corporation and other European producers are denied the American market, the 6 million tonnes of steel now exported annually to America will be available on the European market, where it could further depress the industry and affect price levels.
Most significantly of all, these developments have a major effect on the finances of the BSC, which is desperately trying to break even in the financial year 1982–83. As a result of these new difficulties, a shadow has once again been cast over some of our major works. I know only too well that, for example, at Llanwern major strides have been made in the past 12 months. It has been a period in which all production and efficiency records have been broken. Only a few weeks ago, the Secretary of State for Wales said that Llanwern and Port Talbot were
"beginning to look like the secure base on which the future of BSC will hang."
That is encouragement indeed from a Cabinet Minister.
Llanwern has certainly shown what it can do. It now requires new developments. What is known as a Con-cast plant is needed to streamline the production process. By May this year Port Talbot will have this facility. Other major plants already have it. I understand that the cost at Llanwern will be about £100 million. My impression from visits made by Mr. Ian MacGregor to South Wales is that he has every confidence in the future of the plant there and I believe that he supports the new development for which I am calling. It is now up to the Government to provide the wherewithal.
The Government should invest in success, in Llanwern, because that is the way forward not only for the BSC but for all sections of British industry.
9.33 pm
Mr. Hal MillerThe hon. Member for Newport (Mr. Hughes) will forgive me if, in the interests of brevity, I do not follow his remarks closely, beyond congratulating his constituents in Llanwern and Port Talbot on the strides that they have made. That is progress which was not possible or produced until a Conservative Government came into office, restored some reality to the steel industry and restored the need to earn a day's pay in that and other industries. The sad decline in the steel industry to which the hon. Gentleman referred might never have happened if that performance and
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standard had been called for earlier instead of being frustrated by a constant lack of decision by the Labour Government.
My purpose is to explore the Government's mind on the future of the European cartel, to put some views of steel users and a couple of points about private steel companies. I am grateful to the Government that private steel companies have at last been recognised as part of the steel industry.
The European cartel is based on limiting production, cutting capacity and raising prices. I should like to know from the Minister how far that process is intended to go and how long it is expected to endure. It seems to run counter to every trade and industrial policy that the Conservative Party has followed. If pursued to the extreme it might be highly injurious to Britain's interests.
Reference has been made to the American countervailing duties which are threatened because of subsidies to our production, but if our domestic prices are considerably higher than the prices at which we export we shall be subject to the normal GATT dumping charges and the consequent action. That is a real problem. I urge my hon. Friend not to rest comfortably on the assumption that the Government can solve their problems as shareholders in BSC by continually jacking up prices at the expense of users of British steel products.
I challenge the Minister on his too easy generalisation that the price of steel has lagged behind the prices of its end products as well as the rate of inflation. Such is the depression in markets that price rises for many items have been lower than steel price rises in the last few years. I shall give some examples.
Price rises have been accompanied by the withdrawal of discount. The effect in some cases has been a price rise in 10 months of about 40 per cent. A firm in my constituency makes use of steel for pipe fittings. Its productivity has increased by 50 per cent. in the past two years. That increase in productivity has nearly been offset by the steel price rise, which accounts for between 50 per cent. or 60 per cent. of the firm's costs, and by the energy price rises and other cost burdens imposed on industry by authorities, whether central or local.
About 15 times as many people are employed in the steel-consuming industries as in the steel-producing industries. Exports are in similar proportion. The interests of the steel consumers have not been adequately recognised. Their feelings have been ruffled by the cavalier attitude adopted to their representations by the EEC Commission in Brussels. Steel users need to compete not only with imports into this market but with products from third countries in the rest of the world. If we raise the basic raw material price out of line with raw material prices prevailing in the rest of the world, we are bound severely to damage our exports and competitiveness in world markets.
The rises in prices in the last six months have been severe, especially when considered with the depressed markets and foreign competition. I have already referred to a supplier in my constituency with a 50 per cent. increase in productivity. About 75 per cent. of that production is exported. The BSC's steel tube prices have risen from £320 to £410 per tonne in a year, but the Japanese prices to fittings makers are still held at £320. The difficulty faced in competition in markets can well be imagined. That firm takes 18, 000 tonnes of steel a year.

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The position is so greatly distorted in the markets that in the United States of America, the Japanese fittings sell below the actual tube price—that gives some idea of the distortion—with the result that the United States industry has been exterminated and our own industry is now under severe threat with two out of the four firms being unable to compete any longer. This may be another example of the typical Japanese laser-beam approach to attacking particular segments of industry.
I move quickly to the question of private steel makers. I repeat my thanks to my hon. Friend the Minister for all his efforts to restore a measure of justice under the EEC aid scheme to the private steel industry. I ask him to examine whether open die forgemasters should not be enabled to qualify for assistance under this scheme. Under the minimum list heading chosen, which is a recent change, they are disqualified, although they would have qualified under the previous heading and are threatened by the ending of the agreement on forgings between British Steel and Johnson Firth Brown. They wish to know how that development will now take place and why they should be excluded from the aid for reconstruction.
The second point about private steel is once more the shades of Duport, which company is still being asked to repay £3 million of Government regional grant. It would seem to me that that should also qualify under the aid scheme for the private steel industry as it was directed to South Wales at the insistence of the Government and was destroyed by the activities of British Steel. It seems totally wrong that it should be required to repay the development grant in those circumstances.
Therefore, I wish to explore the Government's mind on the future of the cartel. I have put forward some of the practical difficulties that it is causing. I am not expecting a detailed answer this evening but I hope to hear further from the Minister by correspondence. The position must be thought through, in the light of not only the Government's investment in British Steel but the far greater employment in exports by steel users who play such a large part, in particular, in the economy of the West Midlands.
9.43 pm
Mr. Bill HomewoodThe hour is late and I shall make my comments brief. I had a speech prepared but I have put it aside. I shall concentrate on replying to some of the points that have been made, in the interests of the union that sponsors me, and to raise a parochial matter that I wish to bring to the Minister's notice.
When I tried to intervene during the Minister of State's opening speech, it was on the matter that my hon. Friend the Member for Rotherham (Mr. Crowther) pressed substantially in his speech—the constant assurances that we receive that British Steel can cope not only in respect of an upturn in trade but even when trade is on the same level. I have tried to obtain replies from the Minister concerning Corby. A substantial amount of bar and strip is being imported when levels of production are not on the increase but at the design levels that were being met when the steelworks were closed. Indeed, the replies that I receive locally are that this is caused by a hiccup in one of the big steel producing plants—Ravenscraig or
696
Scunthorpe, or on Teesside—and that therefore steel has to be brought in from Sweden, Holland and God knows where else.
It is ludicrous to argue that the steel industry has 20 or 30 per cent. capacity in reserve that it can bring into production should the need arise if it cannot even satisfy the needs of normal levels of production. My hon. Friend the Member for Rotherham has made the same point in respect of the Thrybergh mill. I should like hon. Members to bring such instances to the notice of the Government. I believe that the Department has been seriously misled in respect of BSC's ability to meet even its current commitment let alone any increase in trade.
I was disappointed that my hon. Friend the Member for Whitehaven (Dr. Cunningham) did not mention levels of unemployment in Corby in reading his long list. I constantly point out that the level of unemployment within the inner area of Corby is 30 per cent. and that nowhere in the country, except perhaps Consett, is so badly affected.
The hon. Member for Arundel (Mr. Marshall) referred to the effects of the strike. I wish that hon. Members would talk about the justice of strikes and not always condemn the trade unions by making it appear that there is only one side to the argument. At the time of the strike, inflation was running at 12 per cent. and the Government were offering the steel workers nothing. If the hon. Gentleman believes that such a situation is justifiable and that the workers should not have gone on strike, I should like to know what he thinks trade unions are all about. If one does not strike in that situation, God knows when one does strike.
Mr. Michael Marshall rose—
Mr. HomewoodI shall not give way because the Minister did not give way to me. There is not much time left for the debate.
The hon. Member for Thornaby (Mr. Wrigglesworth) pronounced on the trade union view of Phoenix. We have stated that we will go along with the Phoenix operation. I am surprised that the hon. Gentleman did not know that the Iron and Steel Act, which went through the House last year, contains a commitment by the Government that these operations should be private. We have stressed our belief that they should be in public ownership.
The parochial matter that I wish to raise relates to the new seamless tube mill being considered by the BSC. It will be a tragedy if this mill does not come to my constituency. The local newspaper stated that the Minister had implied that Corby was his kind of town. The Minister was reported as saying that he wished to pay tribute to the remarkable town of Corby and its people, who had set out with determination, imagination and energy to sell themselves and their town which had certain natural advantages and which had immediately started on the long haul of finding new business.
We shall not survive if that new investment does not come to Corby. I would impress upon the Minister that his admiration for Corby could disappear overnight if he does not give us the necessary investment to keep what is left of the steel industry there.
9.49 pm
Mr. John G. BlackburnIn the few moments that remain I should like to pay a warm and

697
sincere tribute to the fine men who work in the steel industry, particularly the management, which has brought about such a change in the situation compared with 12 months ago. The figures produced show an upturn of over 20 per cent. in steel production in the last six months. Any increase the fortunes of this country will start in the basic industries. It is a source of encouragement to hear four hon. Members on the Opposition Benches speak of an upturn in the demand for steel.
I shall direct my comments to the steelworks that dominate my constituency. They are the finest steelworks in this country. I refer, of course, to the Round Oak steelworks at Brierley Hill. Although we have suffered the pain and anguish of many redundancies, with all the resultant social consequences, the Round Oak works have, nevertheless, a great contribution to make.
Let us never forget that no Government have ever given a greater vote of confidence to the steel industry than this Government did when they introduced the Iron and Steel Bill, which wrote off £3½ billion of debts. When we talk about encouraging industry and the avenues to be explored by the steel industry, we should not forget the £900 million that we gave to British Leyland to use the products of the steel industry.
I ask sincerely that information about the discussions on 12 January with Mr. MacGregor on the future of the steel industry and the possibility of further reductions be given to the men and women who work in the industry and to this House as a matter of urgency. We have reached the point at which the possibility of further jobs being put at risk is offensive to both sides of the House, bearing in mind the sacrifices that have been made by the employees in the steel industry.
It is encouraging to hear of the increased demand that we have all been seeking. However, that is not enough. The increased demand for steel products in this country must be met by home production. Introducing steels from abroad would import not only inflation but further unemployment for the people who work in the industry. There are now real signs of encouragement in the demand for steel. We have gone a long way to put the industry on a sound financial footing. We have invested authority in Mr. Ian MacGregor as chairman of the British Steel Corporation, and in my view it is not the role of the Government to run the industry. We were not elected to run industry, nor are we qualified to do so. Nevertheless, we have a solemn responsibility to create an environment in which industry can prosper.
With those comments on behalf of the steel workers of Round Oak, I conclude by expressing the view that the path down which the Government have travelled is being proved right.
9.53 pm
Mr. Norman LamontWe have had a relatively quiet debate. Perhaps the most novel part of it was the intervention of the Social Democratic Party. I shall say a word about that party's amendment.
One of the points to which I did not reply when the hon. Member for Thornaby (Mr. Wrigglesworth) spoke concerned the employee directors. Much has been said on this subject, but I wish to put the facts on the record. Five worker directors were offered reappointment to the BSC board on the recommendation of Mr. MacGregor. Four of the five accepted. The fifth, a member of ISTC, has so far not been permitted by his union to accept. The four who
698
accepted reappointment are members of craft unions within BSC. The ISTC decided—this is a matter entirely for that union; not for the BSC or the Government—to go through elaborate internal procedures to select its candidates for the board. As a result of those procedures, the ISTC put forward two new candidates. Mr. MacGregor wished to retain the team of five worker directors which had been on the board during the difficult period of closures and the survival plan. I understand that the ISTC member who was also offered reappointment is willing to accept, if the ISTC will agree to that. It is not entirely clear to me or, I suspect, to other hon. Members, why the ISTC is not prepared to accept the reappointment of its existing representative on the BSC board, as the other four unions have done.
Contrary to the suggestions that have been made, the Government and Mr. MacGregor are not overriding the terms of the Iron and Steel Acts. The legislation is clear. Before appointing any member to the British Steel board, the Secretary of State is required to consult the chairman. That procedure is clearly intended to ensure that members of the board are considered suitable and acceptable by the chairman, as well as the Secretary of State. The ISTC is not being denied a representative on the board. The offer to the retiring ISTC member still stands and it is open to him to accept it if his union agrees, as I hope it will.
Mr. Stanley OrmeThe trade union movement is concerned about this issue. Surely it is only democratic that the union should be allowed to make its own nomination.
Mr. LamontI have explained the position and I cannot add to what has been said. I hope that the ISTC will take up the offer of a board appointment.
Hon. Members spoke about electricity and energy prices. The Government are concerned that some heavy electricity users have to pay more than their foreign counterparts. That was demonstrated in the recent report on energy by the NEDO task force. The Secretary of State for Energy has received the review of the hulk supply tariff that was commissioned some months ago and is considering what action should be taken.
In the remaining four minutes of the debate I shall endeavour to answer the points raised. The hon. Member for Rotherham (Mr. Crowther) referred to his letter and he will receive a reply. I should point out that there are short-term fluctuations in capacity. For example, consumers may restock before price increases and currency fluctuations may alter the pattern of imports. However, it is impossible for British Steel always to run such a large business in line with short-term fluctuations. The chairman is satisfied that it can find the means to meet any increase in demand.
My hon. Friend the Member for Bromsgrove and Redditch (Mr. Miller) asked how long prices would continue to rise. Unfortunately I am not in a position to answer his question. Price rises go hand in hand with the removal of State aids. I assure my hon. Friend that we do not adopt a cavalier attitude towards steel users. As he rightly said, there are 15 times as many steel users as producers. He raised an extremely important point and we shall pay great attention to the complaints and anxieties expressed.
It is interesting to note the SDP amendment. Like the Opposition amendment, it ignores the private sector's role

699
and, surprisingly, implies that the BSC should produce every type of steel that home and overseas customers require. The Government firmly believe that it would be nonsense to impose that obligation on the corporation. Indeed, it was specifically removed from the statutory duties imposed on it. The hon. Member for Thornaby said that the cuts in the corporation were necessary because of the lack of demand in the economy. That is not what some SDP Members have said. Indeed, it is not what the right hon. Member for Plymouth, Devonport (Dr. Owen) said on 15 February 1981. He said that although it was a terrible thing to say, what Mrs. Thatcher was doing in the steel industry would have been inevitable under a Labour Government. He said that it was quite obvious when the Labour Party returned to office in 1974 that there would have to be a rationalisation of the British steel industry and that if it had been done earlier, there would have been fewer closures and less unemployment.
The right hon. Gentleman has changed his party, but I wonder whether he has changed his views. The hon. Member for Thornaby had the astonishing cheek to say that the two other parties should state their policies on the steel industry. Most of us are waiting for the SDP to state its policy. Its attitude is very much like that of the first prospectus of the South Sea, ubble. Members of the public were invited to subscribe for an undertaking that would be shortly revealed to them. We want to know—
Dr. John Cunningham rose in his place and claimed to move, That the Question be now put.
Question, That the Question be now put, put and agreed to.
Question put accordingly, That the original words stand part of the Question:
The House divided: Ayes 208, Noes 313.

Division No. 47]

[10.00pm

AYES

Abse, Leo

Cook, Robin F.

Adams, Allen

Cowans, Harry

Allaun, Frank

Craigen, J. M. (G'gow, M'hill)

Anderson, Donald

Crowther, Stan

Archer, Rt Hon Peter

Cryer, Bob

Ashton, Joe

Cunningham, DrJ. (W'h'n)

Atkinson, N.(H'gey)

Dalyell, Tam

Bagier, GordonAT.

Davidson, Arthur

Barnett, Guy (Greenwich)

Davies, Rt Hon Denzil (L'lli)

Barnett, Rt Hon Joel (H'wd)

Davis, Clinton (Hackney C)

Benn, Rt Hon Tony

Davis, Terry (B'ham, Stechf'd

Bennett, Andrew (St'kp'tN)

Dean, Joseph (Leeds West)

Bidwell, Sydney

Dewar, Donald

Booth, RtHonAlbert

Dixon, Donald

Boothroyd, MissBetty

Dobson, Frank

Bottomley, RtHonA. (M'b'ro)

Dormand, Jack

Bray, Dr Jeremy

Douglas, Dick

Brown, Hugh D. (Provan)

Dubs, Alfred

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

Dunnett, Jack

Brown, Ron (E'burgh, Leith)

Dunwoody, Hon Mrs G.

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

Eadie, Alex

Campbell, Ian

Ellis, R. (NED'bysh're)

Campbell-Savours, Dale

English, Michael

Canavan, Dennis

Ennals, Rt Hon David

Cant, R. B.

Evans, loan (Aberdare)

Carmichael, Neil

Evans, John (Newton)

Carter-Jones, Lewis

Ewing, Harry

Clark, Dr David (S Shields)

Faulds, Andrew

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

Field, Frank

Cohen, Stanley

Fitch, Alan

Coleman, Donald

Fitt, Gerard

Concannon, Rt Hon J. D.

Flannery, Martin

Conlan, Bernard

Foot, Rt Hon Michael

700

Ford, Ben

Newens, Stanley

Forrester, john

Oakes, Rt Hon Gordon

Foster, Derek

Orme, Rt Hon Stanley

Foulkes, George

Palmer, Arthur

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

Park, George

Freeson, Rt Hon Reginald

Parker, John

Garrett, John (NorwichS)

Parry, Robert

George, Bruce

Pendry, Tom

Golding, John

Powell, Raymond (Ogmore)

Graham, Ted

Prescott, John

Grant, George (Morpeth)

Price, C. (Lewisham W)

Hamilton, James(Bothwell)

Race, Reg

Hamilton, W. W. (C'tralFife)

Radice, Giles

Harrison, Rt Hon Walter

Rees, Rt Hon M (Leeds S)

Hart, Rt Hon Dame Judith

Richardson, jo

Haynes, Frank

Roberts, Albert (Normanton)

Heffer, Eric S.

Roberts, Allan(Bootle)

Hogg, N. (EDunb't'nshire)

Roberts, Ernest (Hackney N)

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

Roberts, Gwilym (Cannock)

HomeRobertson, John

Robinson, G. (Coventry NW)

Homewood, William

Rooker, J. W.

Hooley, Frank

Ross, Ernest (Dundee West)

Hoyle, Douglas

Rowlands, Ted

Huckfield, Les

Ryman, John

Hughes, Mark(Durham)

Sheerman, Barry

Hughes, Robert (Aberdeen N)

Sheldon, Rt Hon R.

Hughes, Roy (Newport)

Shore, Rt Hon Peter

Janner, HonGreville

Short, Mrs Renée

Jay, Rt Hon Douglas

Silkin, RtHonJ. (Deptford)

John, Brynmor

Silkin, Rt Hon S. C. (Dulwich)

Johnson, James (Hull West)

Silverman, Julius

Johnson, Walter (Derby S)

Skinner, Dennis

Jones, Rt Hon Alec (Rh'dda)

Smith, Rt Hon J.(N Lanark)

Jones, Barry (East Flint)

Snape, Peter

Jones, Dan (Burnley)

Soley, Clive

Kaufman, Rt Hon Gerald

Spearing, Nigel

Ket, Russell

Spriggs, Leslie

Kilroy-Silk, Robert

Stallard, A.W.

Lambie, David

Stoddart, David

Lamborn, Harry

Stott, Roger

Lamond, James

Straw, Jack

Leadbitter, Ted

Summerskill, HonDrShirley

Leighton, Ronald

Thomas, Dafydd (Merioneth)

Lestor, MissJoan

Thomas, Jeffrey(Abertillery)

Lewis, Arthur (N'ham N W)

Thomas, DrR. (Carmarthen)

Lewis, Ron (Carlisle)

Thorne, Stan (PrestonSouth)

Litherland, Robert

Tilley, John

Lofthouse, Geoffrey

Tinn, James

Lyon, Alexander(York)

Torney, Tom

McCartney, Hugh

Varley, Rt Hon Eric G.

McDonald, DrOonagh

Wainwright.E.(DearneV)

McElhone, Frank

Walker, Rt Hon H.(D'caster)

McKay, Allen (Penistone)

Watkins, David

McKelvey, William

Weetch, Ken

MacKenzie, Rt Hon Gregor

Welsh, Michael

McNamara, Kevin

White, Frank R.

McTaggart, Robert

White, J.(G'gowPollok)

McWilliam, John

Whitehead, Phillip

Marks, Kenneth

Whitlock, William

Marshall, D(G'gowS'ton)

Wigley, Dafydd

Marshall, DrEdmund(Goole)

Willey, RtHonFrederick

Marshall, Jim (LeicesterS)

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

Martin, M(G'gowS'bum)

Wilson, RtHon Sir H. (H'ton)

Mason, Rt Hon Roy

Wilson, William (C'trySE)

Maxton, John

Winnick, David

Maynard, MissJoan

Woodall, Alec

Meacher, Michael

Woolmer, Kenneth

Mellish, Rt Hon Robert

Wright, Sheila

Mikardo, lan

Young, David (BoltoriE)

Millan, RtHon Bruce

Morris, Rt Hon A. (W'shawe)

Tellers for the Ayes:

Morton, George

Mr. Lawrence Cunliffe and

Moyle, Rt Hon Roland

Mr. Austin Mitchell.

NOES

Adley, Robert

Amery, RtHon Julian

Aitken, Jonathan

Ancram, Michael

Alexander, Richard

Arnold, Tom

Alison, RtHon Michael

Aspinwall, Jack

Alton, David

Atkins, RtHonH.(S throne)

701

Atkins, Robert (PrestonN)

Fletcher, A. (Ed'nb'ghN)

Baker, Kenneth(St.M'bone)

Fletcher-Cooke, SirCharles

Baker, Nicholas (N Dorset)

Fookes, Miss Janet

Beaumont-Dark, Anthony

Forman, Nigel

Beith, A.J.

Fowler, Rt Hon Norman

Bell, SirRonald

Fox, Marcus

Bendall, Vivian

Fraser, Peter (South Angus)

Benyon, Thomas (A 'don)

Freud, Clement

Benyon, W. (Buckingham)

Gardiner, George(Reigate)

Best, Keith

Gardner, Edward (SFylde)

Bevan, David Gilroy

Garel-Jones, Tristan

Biffen, RtHon John

Gilmour, RtHonSirlan

Biggs-Davison, SirJohn

Ginsburg, David

Blackburn, John

Glyn, DrAlan

Blaker, Peter

Goodhew, SirVictor

Body, Richard

Goodlad, Alastair

Bonsor, SirNicholas

Gorst, John

Bottomley, Peter (W'wichW)

Gow, Ian

Bowden, Andrew

Gray, Hamish

Boyson, DrRhodes

Greenway, Harry

Bradley, Tom

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

Braine, SirBernard

Griffiths, Peter Portsm'thN)

Bright, Graham

Grimond, RtHonJ.

Brinton, Tim

Grist, Ian

Brittan, Rt. Hon. Leon

Giylls, Michael

Brocklebank-Fowler.C.

Gummer, JohnSelwyn

Brooke, Hon Peter

Hamilton, HonA.

Brotherton, Michael

Hamilton, Michael (Salisbury)

Brown, Michael(Brigg&Sc'n)

Hampson, DrKeith

Browne, John(Winchester)

Hannam, John

Bruce-Gardyne, John

Haselhurst, Alan

Bryan, Sir Paul

Hastings, Stephen

Buck, Antony

Havers, RtHon Sir Michael

Budgen, Nick

Hawksley, Warren

Bulmer, Esmond

Hayhoe, Barney

Burden, SirFrederick

Heath, RtHon Edward

Butcher, John

Henderson, Barry

Cadbury, Jocelyn

Heseltine, RtHon Michael

Carlisle, John (LutonWest)

Hicks, Robert

Carlisle, Kenneth (Lincoln)

Higgins, Rt Hon Terence L.

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

Hogg, HonDouglas (Gr'th'm)

Cartwright, John

Holland, Philip(Carlton)

Chalker, Mrs. Lynda

Hooson, Tom

Channon, Rt. Hon. Paul

Horam, John

Churchill, W.S.

Hordern, Peter

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

Howe, Rt Hon Sir Geoffrey

Clark, SirW. (CroydonS)

Howell, RtHon D.(G'ldf'd)

Clarke, Kenneth (Rushcliffe)

Howells, Geraint

Clegg, SirWalter

Hudson Davies, Gwilym E.

Cockeram, Eric

Hunt, David (Wirral)

Cope, John

Hunt, John (Ravensbourne)

Corrie, John

Irving, Charles(Cheltenham)

Costain, SirAlbert

Jenkin, RtHon Patrick

Cranborne, Viscount

JohnsonSmith, Geoffrey

Crawshaw, Richard

Johnston, Russell (Inverness)

Critchley, Julian

Jopling, RtHon Michael

Crouch, David

Kaberry, SirDonald

Dean, Paul (North Somerset)

Kellett-Bowman, MrsElaine

Dickens, Geoffrey

Kershaw, Sir Anthony

Dorrell, Stephen

King, RtHon Tom

Douglas-Hamilton, LordJ.

Knox, David

Douglas-Mann, Bruce

Lamont, Norman

Dover, Denshore

Lang, Ian

du Cann, Rt Hon Edward

Langford-Holt, SirJohn

Dunn, James A.

Latham, Michael

Dunn, Robert (Dartford)

Lawrence, Ivan

Eden, RtHon Sir John

Lawson, Rt Hon Nigel

Eggar, Tim

Lee, John

Elliott, SirWilliam

LeMerchant, Spencer

Ellis, Tom (Wrexham)

Lennox-Boyd, HonMark

Emery, Sir Peter

Lester, Jim (Beeston)

Eyre, Reginald

Lewis, Kenneth(Rutland)

Fairbairn, Nicholas

Lloyd, Ian (Havant & W'loo)

Fairgrieve, SirRussell

Loveridge, John

Faith, MrsSheila

Luce, Richard

Farr, John

Lyell, Nicholas

Fell, SirAnthony

Mabon, Rt Hon Dr J. Dickson

Fenner, Mrs Peggy

McCrindle, Robert

Finsberg, Geoffrey

Macfarlane, Neil

Fisher, SirNigel

MacGregor, John

702

MacKay, John (Argyll)

Ross, Stephen (Isle of Wight)

Maclennan, Robert

Rossi, Hugh

Macmillan, RtHon M.

Rost, Peter

McNair-Wilson, M.(N'bury)

Royle, SirAnthony

McNair-Wilson, P. (NewF'st)

Sainsbury, HonTimothy

McQuarrie, Albert

St. John-Stevas, Rt Hon N.

Madel, David

Sandelson, Neville

Major, John

Shaw, Giles (Pudsey)

Marland, Paul

Shaw, Michael (Scarborough)

Marlow, Antony

Shelton, William(Streatham)

Marshall, Michael (Arundel)

Shepherd, Colin(Hereford)

Marten, RtHon Neil

Shepherd, Richard

Mates, Michael

Shersby, Michael

Maude, Rt Hon Sir Angus

Silvester, Fred

Mawby, Ray

Sims, Roger

Mawhinney, DrBrian

Skeet, T. H. H.

Maxwell-Hyslop, Robin

Speed, Keith

Mayhew, Patrick

Speller, Tony

Mellor, David

Spence, John

Meyer, SirAnthony

Spicer, Jim (West Dorset)

Miller, Hal(B'grove)

Spicer, Michael (SWorcs)

Mills, lain(Meriden)

Squire, Robin

Mills, Peter (West Devon)

Stanbrook, Ivor

Miscampbell, Norman

Stanley, John

Mitchell, David(Basingstoke)

Stevens, Martin

Mitchell, R.C.(Soton lichen)

Stewart, A. (ERenfrewshire)

Monro, SirHector

Stokes, John

Montgomery, Fergus

Stradling Thomas, J.

Moore, John

Tapsell, Peter

Morgan, Geraint

Taylor, Teddy (S'end E)

Morris, M. (N'hamptonS)

Tebbit, RtHon Norman

Morrison, HonC. (Devizes)

Temple-Morris, Peter

Morrison, Hon P. (Chester)

Thatcher, Rt Hon Mrs M.

Mudd, David

Thomas, Mike (Newcastle E)

Murphy, Christopher

Thomas, Rt Hon Peter

Myles, David

Thompson, Donald

Neale, Gerrard

Thorne, Neil (llfordSoutn)

Needham, Richard

Thornton, Malcolm

Nelson, Anthony

Townend, John (Bridlington)

Neubert, Michael

Townsend, CyrilD, (B 'heath)

Newton, Tony

Trippier, David

Normanton, Tom

Trotter, Neville

Nott, RtHon John

van Straubenzee, Sir W

Ogden.Eric

Vaughan, DrGerard

O'Halloran, Michael

Viggers, Peter

Onslow.Cranley

Wainwright, R.(ColneV)

Oppenheim, Rt Hon Mrs S.

Wakeham.John

Page, Richard (SW Herts)

Waldegrave, Hon William

Parkinson, RtHonCecil

Walker, Rt Hon P.(W'cester)

Parris, Matthew

Walker-Smith, Rt Hon Sir D.

Patten, Christopher(Bath)

Waller, Gary

Pattie, Geoffrey

Walters, Dennis

Pawsey, James

Ward, John

Penhaligon, David

Watson, John

Percival, Sir Ian

Wells, Bowen

Pink, R.Bonner

Wells, John(Maidstone)

Pitt, William Henry

Wheeler, John

Pollock, Alexander

Whitelaw, RtHonWillian

Porter, Barry

Whitney, Raymond

Prentice, RtHon Reg

Wickenden, Keith

Proctor, K. Harvey

Wiggin, Jerry

Pym, RtHon Francis

Wilkinson, John

Raison, Timothy

Williams, D. (Montgomery)

Rathbone, Tim

Williams, Rt Hon Mrs (Crosby)

Rees-Davies, W. R.

Winterton, Nicholas

Renton, Tim

Wolfson, Mark

Rhodes James, Robert

Wrigglesworth, lan

RhysWilliams, SirBrandon

Young, SirGeorge(Acton)

Ridley, HonNicholas

Younger, RtHon George

Ridsdale, SirJulian

Rifkind, Malcolm

Tellers for the Noes:

Roberts, M. (Cardiff NW)

Mr. Anthony Berry and

Roberts, Wyn (Conway)

Mr. Robert Boscawen.

Roper, John

Question accordingly negatived.
Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 32 (Questions on amendments), and agreed to.
Mr. SPEAKER forthwith declared the main Question, as amended, to be agreed to, pursuant to Standing Order No. 18 (Business of Supply).
Resolved,
That this House calls upon Her Majesty's Government to continue to encourage the British steel industry to improve its efficiency and competitiveness in order to strengthen its overall health and profitability; and to pursue a successful privatisation programme for the British Steel Corporation.

Social Security
10.14 pm
Mr. J. W. RookerI beg to move,
that an humble Address be presented to Her Majesty, praying that the Child Benefit (Claims and Payments) Amendment Regulations 1981 (S.I., 1981, No. 1772), dated 9th December 1981, a copy of which was laid before this House on 18th December, be annulled.
I start by asking why we are here tonight. There is a serious answer to that question; we are here to remove the individual right of weekly payments of child benefit to mothers. That is the intention of the regulations. Aneurin Bevan once said:
"there is no test for progress other than its impact on the individual."
That excellent test should be used more often in the Labour Party and on that criterion the House is not making progress tonight.
Who wants a change that will mean that 50 per cent. of mothers who collect child benefit weekly must leap a series of high hurdles if they are not to be put on to child benefit payments every four weeks in arrears? It is no good Ministers saying that there is a form in the claims book. Many mothers receiving weekly child benefit will not send in those claim forms, even after the six month waiting period following the commencement of the regulations.
Therefore, 50 per cent. of mothers will be badly affected by the regulations. The position will be even worse for new mothers after 15 March 1982 when, of course, only those on supplementary benefit or family income supplement or widows and those who can prove hardship, without the right of appeal, will be able to claim weekly child benefit.
Child benefit was one of the most important achievements of the last Labour Government. It consisted of a cash payment to mums every week if they wished it, rather than a combination of family allowance and child tax relief to the father—money which most mums never saw. Childless couples benefit if today's children are looked after well enough to provide the wealth for their retirement pensions.
No one wants the change except for a very small band of what might be called "politically motivated persons" in the Treasury. The Government will save only £7 million a year in administrative payments and then only from 1987–88. There is a slight improvement on the original proposal, but for the financial year 1982–83 there will be a cut in child benefit payments of £56 million.
It may be argued that that is a once-and-for-all cut, but it is a cut for mothers in the financial year 1982–83. If anybody doubts that it is not the Government's intention to cut, I ask him to consider the statement of the former Secretary of State at Question Time on 31 March 1981. When challenged by myself and other Labour Members about the cut in benefit for the year in which the change to four weeks took place, he said:
"Any effect on total public expenditure occasioned by less frequent payments of child benefit—the hon. Gentleman rightly used the term 'cash flow'—will affect cash flow in moving expenditure from this year to next. The resulting reduction in public expenditure this year is a reduction which the Chancellor must have if he is to meet his Budget targets."—[Official Report, 31 March 1981; Vol. 2, c. 143.]
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That is a cut and there is no getting away from the fact that it is part of the Chancellor's cuts for 1982–83. I am surprised that that cut is not mentioned in the memorandum I referred to earlier that the Government gave to the Select Committee on Social Services when they totalled up the cuts in social security to £1·4 billion. I submit that it ought to be 1·45 billion, because this cut must be included.
Mothers are losing an individual right. They can claim child benefit every four weeks now if they wish. The take-up rate of weekly collection was only 24 per cent. in March 1979. By March 1980, when the Government's first set of cuts had started to bite, 35 per cent. of mothers collected the benefit weekly. Those figures were given to the Select Committee by the Post Office last year. In June 1980, the figure was 45 per cent. and in December that year it was 48 per cent. Those figures were given in a parliamentary reply on 23 March 1981. The Minister said of the 48 per cent. figure "It was Christmas". That might have stood up but for the fact that by June last year 50 per cent. of mothers were collecting child benefit weekly. Between March 1979 and June 1981 the figure had doubled.
It is clear that the Government want the change. Let us look at who does not want it. A number of organisations were quoted in a written answer on 1 April 1981, including the Child Poverty Action Group. That was predictable. The CPAG would not want the change, because it is concerned with child poverty. The National Federation of Sub-Postmasters does not want the change. I cast no aspersions on the federation, but it was predictable that it would oppose the change, because it has a vested interest. Its members' incomes will be cut.
Other organisations listed in the answer include the National Council for Voluntary Organisations, the National Federation of Women's Institutes, the Women's Liberal Federation, the Labour Women's Committee for Wales, the Family Welfare Association, the Family Service Units, the Health Visitors Association and the National Union of Teachers. Teachers see the results of child poverty every day. The Royal British Legion does not want the change and neither does the Women's National Advisory Committee of the National Union of Conservative and Unionist Associations. In addition to that august committee, the general purposes committee of the National Union of Conservative and Unionist Associations—which is the equivalent, I imagine, to the Labour Party's NEC, so it must be pretty important—does not want the change, as it made clear in a letter to the former Secretary of State on 2 March 1981, signed by the secretary Mr. Alan Smith.
The Tory Party does not want the change, the British Legion does not want it, the Liberals do not want it, the Labour Party does not want it, the teachers do not want it. [HON. MEMBERS: "What about the SDP?"] The SDP has no view. That has been made abundantly clear. Its Members did not even vote in the previous debate. They may have given up Socialism, but they have certainly not given up socialising.
No body concerned with the welfare of children wants the proposed change. The future administration of child benefit will be a nightmare because of the variations in the system of payments.
I wish to raise a number of questions, although I do not want to pre-empt the remarks of my hon. Friends. The CPAG has asked us to raise the question of claimants being

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told about their rights. Will the Government print on supplementary benefit, FIS and widow's benefit claim forms details of the right to claim child benefit weekly? How much will they spend on advertising? That is crucial.
We should also like to know about the Government's discretionary hardship provisions. There is no right of appeal for any mother who wants to claim that she needs the benefit weekly on the ground of hardship. The Social Security Advisory Committee was extremely critical of the regulations. In the Secretary of State's memorandum, which appears at the front of the committee's report, he refers to massive discretionary powers that have been given to him. He stated:
"I shall, of course, be answerable to Parliament for the way in which this discretionary provision is applied."
How is it intended to report to Parliament regularly about the use of the discretionary powers? We also want to know how much the Government will spend on advertising. The rights of individuals are being curtailed because of the regulations. We want to know what criteria will be adopted in deciding what constitutes hardship.
We are dealing with crucial issues. These are not technical regulations. When we debate these issues we do not fill the august Press Gallery, to which we are not supposed to refer. However, the regulations will bear on half the mothers in the country. From 15 March they will have an effect on all mothers. The rights that were given to them by the House following the initiative of a Labour Government are being removed.
I hope that we shall hear much less in future from Conservative Members about the rights of individuals. I presume that they will vote against the prayer. In doing so, they will know full well that they are curtailing and diminishing individual rights. I can say that without fear of contradiction. We are not discussing the niceties of paying benefits into bank accounts, compulsory four-week payments or compulsory weekly payments. We are discussing the right to the payment weekly if the mother thinks that she needs it, and she is in the best position to decide.
One of the first actions of an incoming Labour Government, who will surely follow the defeat of the Conservative Government at the next general election, will be to restore freedom of choice to all mothers to collect child benefit weekly if that is what they wish and not if Ministers so wish. That is a firm pledge.
10.27 pm
Mr. Peter BottomleyOne of the problems of child benefit is its name. If it had been called child tax credit, there would have been more concern about it. Tax allowances appear to be more popular than benefits. Child benefit might be the exception to that general rule, but it might have received more attention from the Government if the name had not been changed by the Labour Administration.
The hon. Member for Birmingham, Perry Bar (Mr. Rooker) talked about the increasing number of parents, mainly mothers, who are now drawing child benefit weekly. About 10 years ago my wife was working for the head of the Child Poverty Action Group, who is now the hon. Member for Birkenhead (Mr. Field). She was engaged in surveying the budgeting behaviour of low income families. The initial evidence that was produced
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persuaded the then Conservative Government not to switch the value of the family allowance and child tax allowance into husbands' pay packets.
The importance of the family allowance, as it then was, which was only a minor proportion of family income support, was revealed by CPAG research. It was shown to be essential to many low income families that were exposed to job changes, difficult domestic circumstances, the split-up of families, the loss of jobs and desertion, for example. The CPAG surveys provided the evidence that, I think, persuaded the Select Committee that it was important to restrict payments to the mother and to continue with the benefit in weekly payments.
Since that time there has been a general rise in the standard of living, but there has not been an obvious general rise in the standard of living of families with children, especially poor families with children.
During the past few months many organisations have argued for freedom, for the reverse of what the Government have proposed. That battle may be lost tonight. With some misgivings, I shall support the Government, because it is important to win a greater battle—the level of child benefit itself, on which I believe we can argue tonight.
The important issue about child benefit is to try to increase it, if necessary by stages, to a level approximately double the present level. It is not feasible for that to happen in a year or so, but it is feasible to have an announcement from the Government in the next two months that, as economic conditions are clearly easing, child benefit will be restored to the level of April 1979, when they came to office.
We know from the present change that if half the mothers move on to the monthly payment of child benefit £56 million of the public sector borrowing requirement is saved in the first year. It is also open to the Government to save more money on the PSBR if, instead of "Rooker-Wising" the whole married man's part of the married man's tax allowance, they give the same increase in the allowance to married people as to single people. Those married men below retirement age would forgo £310 million, which, if distributed to child benefit, would give an extra increase above inflation and put child benefit a penny or two above the level in April 1979. That is essential. I hope that more hon. Members will put that point to the Government in the weeks before the Budget.
I return to the switch to four-weekly payment. It is important for the Government to review all the publicity material that they have decided to put out or are thinking about. I commend to them the idea, not simply of printing it on the back of the child benefit order book—which may already have been determined in advance of the vote tonight—but of enclosing with the order book a leaflet in black and red—non-partisan—produced by the Child Poverty Action Group in association with the National Federation of Sub-Postmasters. If the Government want to leave out of their leaflet the advertisement for joining the CPAG, so be it, but they should put out an eye-catching document like that, spelling out the opportunities that will be available to mothers if the prayer is defeated.
The Government have given a commitment to monitor how the change affects mothers. They should decide in advance, and publicise, what tests they will apply, and give a regular report to the House on the decisions made

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in each case where a mother or a father has applied to have weekly payment, when that parent does not fall into one of the authorised categories.
If the Government have to make savings of £56 million in this way—if it were not necessary, it would be easy to pay the four-weekly benefit at the beginning of the month rather than at the end, so one assumes that the decision was made the other way round purely for the financial saving—I hope that when economic conditions ease they will regard themselves as having £56 million that needs to be returned to parents with interest.
Having suggested switching the inflation increase in the married man's tax allowance, I wish to point out another possible switch on the PSBR. If the £310 million is given in the tax allowance, the full cost falls on the Treasury in the first financial year, because tax allowances are available from April. If it is put on to child benefit, the cost to the Government in the first financial year—1982–83—is only one third—£100 million rather than £310 million. The Government ought to consider, as economic conditions ease, switching back the extra £200 million that has been saved to child benefit.
One point that has been regularly missed in the House, generally by the Treasury, which goes into a static rather than a dynamic economic analysis, is the importance of child benefit in general economic conditions. It is associated with a generally lower level of pay settlements. I do not believe that we shall get pay settlements roughly in line with changes in the underlying economy unless we make sure that we protect the low paid who have family responsibilities. It is unreasonable to expect those who represent low paid workers to settle for pay increases below the level of inflation unless child benefit is increased more greatly than inflation.
As Douglas Grieves, general secretary of the Tobacco Workers Union bravely said, the family wage is a myth for lower paid people. There is no way that the lower paid worker can expect to support a wife, or spouse, and children on minimum rates. Child benefit is an essential element in making sure that we do the right thing by those who cannot look after themselves. We have done quite well for pensioners, we have not done quite so well for the sick and the unemployed, and in the last 25 years we have done badly for families who are raising children on low incomes.
10.36 pm
Mr. Robert Kilroy-SilkLike my right hon. and hon. Friends, I rise to oppose the Government's attempt to end the system of weekly payments of child benefit. It is yet another example of the Tories' attempts to erode gradually and insiduously the Welfare State.
The hon. Member for Newcastle upon Tyne, East (Mr. Thomas), who now represents the Social Democratic Party, laughs at what I have said, but he does not seem to take the protection of the rights of those who are suffering from not being able to pay their fuel bills or of those who are in receipt of child benefit sufficiently seriously to be in the Chamber or to vote in the House on most of the occasions when these matters are raised. Perhaps we can hear a little less from him.
The regulations provide that from 15 March child benefit will be provided only every four weeks unless the mothers are currently in receipt of child benefit or, if they are new mothers, if they are in receipt either of family
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income supplement or supplementary benefit, or if they are lone parents, take the initiative to opt for weekly payments.
I am concerned that many mothers who are currently in receipt of child benefit will forget to opt for weekly payments or will not have seen the publicity about the change. If they have, they may overlook the procedure necessary to opt for benefit and so will not receive the weekly payment that they require. I am also concerned that many of the mothers who become eligible for child benefit and who are not in receipt of supplementary benefit or family income supplement, or who are lone parents, will nevertheless be sufficiently poor to require it to be paid weekly, not monthly.
As my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) said, the Select Committee on Social Services said that the number of women cashing their child benefit on a weekly basis had increased dramatically during the lifetime of the Tory Government, from 24 per cent. at the beginning to 50 per cent. in June last year. That is yet another sign both of the depth of the recession and of the public expenditure cuts and high unemployment that the Government have brought about, necessitating a tightening of the belt of middle class, middle income families to a greater extent than in the past.
All women should have the right to receive weekly payments. As my hon. Friend said, everyone who has spoken on the issue—all the pressure groups, individual women and political organisations—except the Minister and his friends want benefits to continue to be available on a weekly basis. Indeed, I gather that the Minister has received about 42 petitions, signed by 12, 500 people, asking for weekly payments to continue. How many has he received asking for monthly payments?
The Child Poverty Action Group points out that child benefit is a vital source of regular income for many mothers, and the only source of independent income for many women. It is therefore extremely important that it should be available to them on a weekly basis as of right. If they choose otherwise, it should be their own decision to collect it at longer intervals, not something arbitrarily imposed upon them by the Minister.
If the proposals are approved they will cause a great deal of distress and inconvenience and put a large number of women under considerable financial pressure. II is yet another example of the Government's mean-minded, petty penny-pinching, spiteful attitude towards benefits and beneficiaries in the Welfare State system.
Certainly the Government seem to be putting administrative convenience well before the interest of the claimants and beneficiaries. It is scarcely won h introducing the regulations, with the inconvenience and distress that they will occasion, simply to save about £7 million. Moreover, the Government are not just introducing compulsory four-weekly payments, but making them payable in arrears, thereby saving £56 million. In effect, the Government are stealing £56 million from the women of this country. That is a disgrace and a scandal, which members of all parties should not allow to pass tonight.
10.42 pm
Mr. Reg RaceMy principal objection to the Government's proposal is that it will mean a saving to the Government of a paltry £7 million and very

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substantial inconvenience to millions of women. Moreover, it shows that the Government do not understand the realities of working-class life in this country.
Many supporters of the Labour Party, but proportionately far more supporters of the Conservative Party, receive their salaries or wages monthly, but the vast majority of poor people and manual workers, if they are in work at all, receive their wages weekly. Most of the working people of this country make weekly payments for their groceries, their rents and indeed their rates in the case of council tenants and some private tenants. It is therefore a crude reality of the working class in this country that payments are made on a weekly basis. For the Government now to tell millions of women and children that benefits are to be paid on a monthly basis unless they specifically opt otherwise will mean serious hardship for families who will find it difficult to adjust.
Reference has been made to the way in which more and more women have been forced, by the logic and necessity of their circumstances, to opt for weekly payments. Women do not now have to draw child benefit weekly. They can opt to leave the orders in the book until such time as they wish to cash them. As my hon. Friend the Member for Birmingham, Perry Barr (Mr.Rooker) rightly pointed out, a basic liberty is being taken away by the Government.
Nobody has asked the Government for the measure. Women have not asked for it, and organisations have not asked for it. The Government have introduced it simply to save £7 million. Given the scale of the Government's attack on the poor and on social security benefits, involving £1·4 billion in the next financial year, a saving of £7 million on a permanent basis hardly seems worth the candle.
It is important to discuss the likely consequences for individuals of the Government's action. Why is no time limit set in the regulations? After 13 September 1982 no claims for weekly payments will be allowed. Why is there that inflexibility? Why cannot there be a continuation of the present system under which people who wish to cash their orders weekly may do so? What happens when people are in changed and straightened circumstances? What happens when the man or woman loses a job and their family income drops from £100 a week to the level of unemployment benefit and the child dependency addition? What will that mean for them?
If such people receive monthly payments they will have to go through a bureaucratic procedure to obtain weekly payments. A letter to the DHSS office will not suffice. The request for weekly payment must be made on a prescribed form and sent to the local DHSS office. Why is that so? Must we put millions of people through a bureaucratic nightmare and make them write to the DHSS office, be told that they have not filled in the appropriate form and then be sent the form? By that time some will have fallen by the wayside and will not return the form. Why on earth must we put people through all that?
On what basis will discretionary payments be made? How will parents be informed that discretionary payments are available? What procedures will be adopted to administer the scheme? What will be the criteria for accepting that hardship is taking place? That is important because in our unequal society many men in employment, and many who are not, do not give their spouses sufficient
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money to meet the weekly grocery bills. I suspect that the DHSS might take a long time to accept that a woman does not have sufficient income from her husband to meet the regular weekly bills. It might not accept that such a woman is in hardship because it takes account only of the family's total income. That will affect the way in which women conduct their duties in the household.
I am also worried about the political effects of the regulations. I am worried about women drawing four weeks' child benefit at the post office. Many women with three or four children will draw substantial sums. They will draw it across the counter. I do not wish to hear Conservative Members running campaigns against the level of child benefit—as the hon. Member for Aberdeen, South (Mr. Sproat) has over the years—complaining that people are being paid too much. If such a campaign were mounted as a consequence of the regulation, it would be a disgrace. I hope that it will not happen, but it is another reason for the regulations not being approved tonight.
Mr. Mike ThomasThey had never thought of that until the hon. Gentleman mentioned it.
Mr. RaceI am sure that they would have thought about it very quickly when they entered a post office or when some of their more reactionary constituents wrote to them complaining about the matter. I hope that the Government will have second thoughts. I hope that the votes of hon. Members tonight will remove the regulations. They will effect the living standards of ordinary working people and attack the cash flow of families, to the detriment of children in those families. they will operate directly against the interests of all concerned. I hope that hon. Members will vote against the regulations to protect the interests of the children and the families concerned.
10.50 pm
Mr. Keith BestThe House is indebted to the hon. Member for Birmingham, Perry Barr (Mr. Rooker), if only for giving further publicity to the measure. All the families that read Hansard avidly will learn more about it. If the House does not accept that families in poor conditions read Hansard avidly, there is a clear commitment on the Government to use their best endeavours to make sure that families that will be affected are fully appraised of the situation. I know that my hon. Friend the Minister will have some remarks to make on that matter.
This is an issue that all hon. Members will scrutinise carefully. I do not believe that there would be any dispute if it were felt that by adopting such proposals the £7 million saved would be allocated to those in the greatest need. My hon. Friend the Member for Woolwich, West (Mr. Bottomley) said that the money should go toward child benefit, which I believe would be generally accepted. I hope that the Minister will be able to say where the savings will be directed. If he does not, I am sure that many hon. Members will watch carefully to see that the money reaches the families in greatest need.
A fundamental misapprehension that seems to prevail among Opposition Members who have spoken in the debate is that an increase in the take-up of child benefit weekly means that the families need the money desperately every week. That is one inference to be drawn,

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but it is not necessarily the correct conclusion. If money is available to be collected, there are very few people, I suspect, in any walk of life who will leave it sitting where it is if it can be collected at an earlier date.
Opposition Members have said that 50 per cent. of claimants collect the money on a weekly basis. What is important is that those in the greatest need, if supplementary benefit, family income supplement and lone parenthood are the measures will still be able to take these payments on a weekly basis. That point has not perhaps been sufficiently stressed in the debate.
The hon. Member for Perry Barr says that the measure is a direct attack on the freedom of the individual.
Mr. Douglas HoggRubbish.
Mr. BestMy hon. Friend the Member for Grantham (Mr. Hogg) says "Rubbish". I shall be kinder to the hon. Member for Perry Barr. I shall call it inaccurate. I would also describe it as rather insulting to those receiving child benefit. By enabling a greater sum to be taken on a four-weekly basis, the measure enables parents to spend the money on clothes or for other purposes in a manner that allows far greater latitude than would be the case if it were collected on a weekly basis. If the view of Opposition Members is that those receiving child benefit cannot be trusted to accumulate the money in order to spend it on items of major expenditure for children, they are doing those people a great disservice.
Mr. Clement FreudIf the hon. Gentleman is talking about accuracy, will he accept that these regulations do nothing that people were unable to do before? They just stop the options.
Mr. BestThe hon. Gentleman is right, but what he says does not in any way demean my argument that these regulations still enable people to spend money in larger sums when they collect it at four-weekly periods. They are entitled to accumulate that money now on a weekly basis. Opposition Members are saying that people cannot be trusted to take the money in four-weekly amounts. That is grossly insulting to the people who receive it.
The only point that I want to stress tonight—[HON. MEMBERS: "Oh!"]—other than those that I have made and which I believe are quite substantial—relates to monitoring. I hope that my hon. Friend the Minister will tell us a little more about the monitoring process. I do not accept that injustice is inherent in these regulations, but I accept the strength of feeling among Opposition Members. If there is injustice, it must be closely watched to make that sure that it is rectified.
I hope that my hon. Friend the Minister will come back to the House and tell us how many people who can take child benefit in only four-weekly amounts are applying to have it paid weekly, and on what grounds they make that applications, so that the House may know exactly how many people are affected in that way. If the investigations show that there are very few, or none, I suspect that Opposition Members—who I always hope are reasonable people, if nothing else—will accept that no hardship has been caused.
Mr. Douglas HoggThere is a further aspect, as I am sure my hon. Friend will agree. The various pressure groups will keep in touch with the Department and inform my Front-Bench colleagues of any cases of injustice or classes of cases of injustice that arise as a result of these regulations.
Mr. BestMy hon. Friend is right, but that does not involve only the Department. He may not be on the mailing list of the Child Poverty Action Group, but I and many other hon. Members on both sides of the House are, and we regularly meet people from that group. The Government will be subjected to precise details of cases of hardship, and hon. Members will make representations to the Government on the Floor of the House. I hope that my hon. Friend will say more about that matter when he winds up the debate.
Let there be no mistake about the strength of feeling on both sides of the House on the need for child benefit. We all accept, without dissent, that child benefit should be increased far more than has happened in the past. so that we need not have debate after debate about the real poverty that can exist in families that desperately need more child benefit. That is in the true tradition of both the major parties that are represented in the House. It is particularly true of the party that I represent, because it is a matter on which he have a particularly fine record. I hope that that record will not be marred.
10.59 pm
Mr. David StoddartAt Tory Party conferences Ministers always preach in vibrant tones, pontificating about the sanctity of family life and about the family being the backbone of our country. They say that as long as we look after the family, everything will be all right. They may say that at party conferences and on public platforms, but when it comes to helping families, it is different.
The history of family allowances and child benefit shows that in office, the Tory Party always rats on the family and on children. In 1968, it was left to the Labour Government to increase family allowances. Between 1970 and 1974, the Conservative Government failed to increase family allowances. A Labour Government had to introduce child benefit at a reasonable rate. It was riot high enough, but it had the apparent support of Conservative Members. When the Conservative Party took office in 1979, it ratted again on families and children by failing to pay the 50p increase agreed by the previous Labour Government. That is how much Conservative Members think of families.
The pontificating utterances at Conservative Party conferences and so on are followed by attacks on families. Hon. Members should make no mistake about it, the poorest in society are those with children, regardless of whether they receive supplementary benefit. Those who do not receive supplementary benefit or family income supplement, but who earn low wages, may suffer more hardship than necessary because of the Government's attitude to families.
The Tories significantly increased taxes for families by failing fully to index tax allowances in 1980–81 and they did not increase tax allowances at all in 1981–82. Since 1979 families have been attacked. The regulations represent a further attack and will make it even more difficult for families—and particularly for women—to make ends meet on a weekly basis. Therefore, we oppose them.
Conservative Members should understand that working-class people budget on a weekly basis. If they cannot do so, their finances go haywire and they may well get into all sorts of difficulties and debts, such as rent arrears which will rebound against them and against the

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State. The regulations will not help families, but hinder them and make life more difficult. It is useless to say that families will be able to save for four weeks. Many families need the money on a weekly basis to feed their children and to provide heating in their homes. If they want to save they can do so under the present system, because they can leave the money for one month or six months.
The regulations are nasty and mean minded. They seek to save millions of pounds and to reduce the net borrowing requirement, probably so that highly paid taxpayers can be relieved in the Budget. The hon. Member for Woolwich, West (Mr. Bottomley) has far more confidence in his Front Bench than me, or some of the Conservative Members sitting behind him. So far, the Government's record does not hold out much hope of assistance for families. I shall certainly oppose such dreadful regulations. Those like the hon. Member for Woolwich, West—who has a good record on this matter—should throw the regulations out of the window.
Several Hon. Members rose—
Mr. Deputy Speaker (Mr. Bryant Godman Irvine)Order. I understand that the Minister would like to commence his reply at 11·15 and two other hon. Members wish to intervene between now and then. I leave the arithmetic to them.
11.5 pm
Mr. Andrew F. BennettThese are among the most obnoxious regulations to come before the House since I have been a Member. The sub-heading should be "Big Sister knows best", because that is what the Government are saying. They are saying that it is not for the individual to make a choice and that the individual should do what suits the Government rather than what is in his best interests. That is the most obnoxious thing about the regulations.
The Conservative Party claims to have some concern for the individual, yet it has come forward with regulations that take away the individual's right to choose. It is saying "You must collect your benefit monthly instead of weekly, fortnightly, monthly or as suit your circumstances". To say that it must be collected monthly in arrears is particularly mean and despicable.
Having announced this proposal, the Government discovered that everyone was up in arms, as a result of which they back-tracked, but instead of back-tracking totally, they have come forward with this compromise, which as usal makes things more complicated and unsatisfactory for the claimant.
The Government are saying to existing claimants that if they fill in a special form, they can continue to get the benefit weekly, but that new claimants will have to show hardship. They are trying to brand those who claim weekly as people who suffer hardship and cannot quite manage. In other words, they are trying to suggest that this is a second-class group of people in order to discourage them from claiming weekly.
The message from this House should be that as far as possible people ought to claim their benefit weekly. They should certainly be allowed to exercise their own choice. They should be free to decide whether they want to cash their benefit each week or leave it for a week or two. The
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trouble is that once someone accepts a monthly payment, they will have great difficulty if they want to go back to a weekly payment.
Sometimes, the collection of child benefit weekly is important for many of my constituents, especially when they experience unforeseen circumstances, such as loss of a job or sickness. They find that it takes time to go through the bureaucracy of the DHSS. It may take four or five days to sort out their claims, and during that time child benefit is something they can get without fuss. It keeps the family going. Surely every family should have the ability to collect child benefit if it is needed.
No one can predict what unfortunate circumstances may befall a family. I know of many cases in my constituency where, for some reason or other, the husband has left the wife and all she is left with is the child benefit book. That proves extremely important while supplementary benefit is sorted out.
That is what the Government are taking away. People will now have to go through the bureaucratic process of changing from a monthly to a weekly payment. My message is "Whatever your present circumstances, take advantage of the Government's offer and make sure that you opt for weekly payments". Let people have the right to choose. Do not let Big Sister dictate what she thinks is best.
11.9 pm
Mr. Frank FieldI rise to oppose the regulations. If, instead of discussing the position of 8 million mothers we were debating an order affecting 8 million fathers and suggesting that their weekly wage packets should be replaced by monthly payments, my guess is that the House of Commons would be full and the Government would not get their measure through. It is a sad reflection on how difficult it is to make the needs of women felt in the House that not only is the debate poorly attended, but the Government are so confident of getting their way in the Lobby that they have begun to operate the scheme before they have parliamentary power to do so.
Mr. Douglas HoggThe Conservative Party has the majority of Members in the Chamber tonight.
Mr. FieldThat may well be so. I was not trying to criticise one side or the other. It is sad that there are only about 30 hon. Members in the House. When we are short of debating time, interruptions from a sedentary position are unwelcome.
The measure is wrong, for three reasons. First, it reduces choice. It is slightly ironic that the Conservative Party is introducing the measure. At a time when child benefit is reaching a decent level, when it is worth drawing weekly and when, as my hon. Friend the Member for Stockport, North (Mr. Bennett) said, more families are drawing it weekly, we shall lessen the choice of the many families who draw benefit weekly. Child benefit may be uninteresting to some, but it is interesting to us, because it tells us something about the sort of society that we, as the House of Commons, wish to create. Do we wish to have a society that minimises bureaucratic interference with people's lives, or one that maximises it? Do we wish to have a society that maximises people's choices, or minimises them?
That is what these dry little regulations are about. We are taking away from 8 million mothers the choice to draw

717
their child benefit payments weekly, fortnightly, monthly or up to six-monthly. The proposal is wrong, because many mothers will not know the importance of weekly child benefit. My hon. Friend the Member for Stockport, North made that point. Many of us believe that our families are secure, but circumstances sometimes change. Unemployment or sickness may strike, or a husband might leave. In those circumstances, the regular weekly payment is crucial. Many mothers are not yet in a proper position to realise how necessary it may be for them in the future to draw child benefit weekly.
Mr. Douglas HoggI realise that the hon. Gentleman knows a great deal about the matter but, in the situation that he just described, if the family is in receipt of supplementary benefit the right to weekly payment would arise.
Mr. FieldThe hon. Gentleman makes my third point for me. The matter is crucial, because in my surgery, as in many other hon. Members' surgeries, mothers say that if it were not for child benefit they would have nothing. On Friday, a mother who had been trying to draw supplementary benefit since May 1980 said that without child benefit, for many weeks she would not have been able to feed her children. Under the present system, until she had received supplementary benefit she could not opt for the weekly payment of child benefit.
There are some questions which all of us have put to the Minister tonight and to which we wish to receive answers. As I said in an earlier debate this evening, I represent a neighbouring constituency to the Under-Secretary of State for Health and Social Security, the hon. Member for Wallasey (Mrs. Chalker). About 20, 000 mothers in her constituency and 15, 000 mothers in mine will lose the right to the weekly payment of child benefit unless they know what to do. Therefore, as the hon. Member for Anglesey (Mr. Best) said, we wish to know much more about the advertising campaign that the Government will initiate.
I suggest two useful things that hon. Members who have an interest in the matter may wish to do. I wrote to all the clergy in my constituency asking them to make a special announcement about the changes before Sunday services. Almost all of them did. They put the announcement in newspapers and on notice boards.
The other crucial group to inform of the change is sub-postmasters. I plead with hon. Members to write to each sub-postmaster in their constituencies and ask him, when each mother comes to draw child benefit, to draw her attention to the form at the back of the child benefit book, which she should fill in and post to the centre at Blackpool. Many hon. Members are doing what advertising they can, but we want to know more about the Government's advertising campaign.
Lastly, there is a question of monitoring. We are worried about the difficulties that some families may face in establishing their right to weekly child benefits. If the scheme does not work as smoothly as the Government have suggested, will they revoke the regulations and revert to weekly child benefit payments?
The proposal is wrong, for three reasons. It lessens choice and decreases individual freedom. Most mothers are not in a position to know whether they will be in desperate need to claim weekly child benefit payments in the future. Mothers receiving child benefit say that it is the only secure payment on which they can depend each week.
718
I end on the point that I began with. It is sad that we are discussing the rights of 8 million women in an almost empty Chamber. We would never have treated 8 million fathers in this way.
11.15 pm
The Minister for Social Security (Mr. Hugh Rossi)I shall try to answer as many of the questions raised as I can in the time left to me, but a number of points were exaggerated almost beyond reason.
No basic individual liberty is at risk. The freedom of choice of existing mothers will not be taken away. The choice will be given to future mothers if they fall within categories where hardship might be suffered by a four-weekly payment. Finally, no one will lose any benefits as a result of the regulations. They will continue to receive exactly the same amount.
The £56 million to which the hon. Member for Birmingham, Perry Barr (Mr. Rooker) referred is an accounting accident, which arises from the fact that if payments are deferred from a weekly to a four-weekly period certain payments fall outside the Government's accounting year. It will not in any way prevent the recipients from receiving the money due to them during the year. It is nonsense for the Opposition to raise the point. It is purely a matter of Government bookkeeping.
I was asked whether the Government had noted the representations made by various bodies. The matter has been under discussion for about two years. It has been fully discussed inside and outside the House. The Government took on board the views expressed. The final decision was announced on 12 May. It was stated that all mothers in receipt of child benefit would be given a choice of switching to four-weekly payments or continuing with weekly payments, but, in general, new mothers would not be given a choice; they would have to be paid four-weekly. However, any new mother in receipt of supplementary benefit or family income supplement or who is a lone parent—including widows—will be given the choice of having a weekly payment, as was said by my hon. Friend the Member for Anglesey (Mr. Best). That covers the classes of people likely to suffer hardship.
The regulations implement that decision. As hon. Members know, the regulations were referred to the Social Security Advisory Committee before they were published and the report that it published included a statement by the Secretary of State for Social Services in accordance with section 10(4) of the Social Security Act 1980. That statement was a response to the committee's recommendations.
I thought it important to spell out the facts to demonstrate that it has not been a quick change, but has been under discussion for some time and that the Government have taken fully into account representations and points made by hon. Members, organisations and members of the public. The proposals have been considerably modified in the light of comments made.
The hon. Member for Perry Barr read out a list of organisations that objected to the original proposals. Since the organisations listed by the hon. Gentleman objected to the change, the Government gave existing mothers the choice to stay on weekly payment if they wished. It was the desire of those organisations that that be the case.
Why are we making the change? We are changing the payment of child benefit to improve efficiency in paying social security benefits. We estimate that if about half of

719
the existing beneficiaries opt for weekly payment, administrative savings of about £7 million a year will be made by about 1987-88 and smaller savings will be made in the earlier years.
The financial savings in themselves are not of great import. The important factor is that the system will become far more efficient administratively. We consider that our action strikes a fair balance between the needs of beneficiaries and our duty to keep down administrative costs.
I shall spell out how the regulations are being implemented and deal with the publicity monitoring and hardship, to which several hon. Gentlemen referred. Starting from mid-November 1981—[Interruption]. The hon. Member for Ormskirk (Mr. Kilroy-Silk) is not being fair he keeps interrupting from a sedentary position. I am trying to answer questions. I have little time and he is making it very difficult for me. I hope that he can compose himself.
Starting from mid-November 1981, all child benefit renewal order books contained an option card. That will continue until March 1982. The card explains that child benefit will be paid at four-weekly intervals in future, but that existing mothers can choose to continue with weekly payments if they wish. Their attention is drawn to the card by a message in red on the front of their order books. All that the mother has to do is remove the card from the back of the order book, sign it, obtain an envelope from the post office and send it to the child benefit centre at Washington.
Mr. FreudWill the Minister accept that the women who most need the safety net of weekly benefit are those least able to cope with the minutia of filling out forms?
Mr. RossiLet me deal with how much further we shall help the mothers. The card also explains that if a mother would prefer to try four-weekly payments before making a decision, she can do so and still have a six-month period after the start of the four-weekly payment in which to switch back to weekly payments. In that way, all existing mothers will be made aware of the option in their order book and have ample time to decide to continue with weekly payments if they wish.
In addition to the card attached to the back of the order book, a poster is being displayed in post offices drawing attention to the new arrangements and the existing mothers' options. Leaflets, claim forms and the order books are all being amended to reflect the switch. In addition, the Department's regional information offices are taking the opportunity to explain the new arrangements in the local press and on local radio whenever possible. I cannot tell my hon. Friend the Member for Woolwich, West (Mr. Bottomley) what will be the cost of the advertising exercise.
The question of monitoring was raised, principally by my hon. Friend the Member for Anglesey (Mr. Best), but also by others. The Government will monitor the working of the new arrangements and provide the Social Security Advisory Committee with the results. In particular, we shall assess how the hardship provision is working and we shall keep statistics on hardship claims accepted, the reasons for acceptance and hardship claims refused. We shall also obtain the numbers who opt for weekly payments
720
among existing mothers, lone parents and families receiving supplementary benefit or FIS and those who have moved from weekly to four-weekly payments.
Mr. BestI am glad to hear what my hon. Friend has said about monitoring. Does he accept that some families, through reticence or for other reasons, will not try to get benefit paid weekly? What efforts will the Government make to ascertain whether hardship is caused in such cases?
Mr. RossiIf families find themselves in hardship they will, I hope, immediately draw attention to that fact. They will be entitled to apply, under the hardship provisions, for weekly payment. If, having tried the four-weekly payment, a mother finds that she is suffering hardship, she will be seen at her local social security office. The decision on the application will be made following that interview and the mother will be informed before she leaves the office. If it is accepted that hardship is being caused, weekly Girocheques will be issued immediately and the four-weekly order book withdrawn until the necessary arrangements have been made for weekly order books to be issued. We are trying to make the system as easy as we can for the individuals concerned.
I do not wish to be dogmatic or to lay down guidelines or rules on the criteria for hardship. It will be a case of each application being treated on its merits.
Mr. RaceWhy cannot those who suffer hardship get a weekly order book instead of having to wait for Giro cheques from the DHSS?
Mr. RossiIt takes too long to issue an order book. We want to deal immediately with cases where hardship exists. We are making the system as flexible as possible in order to meet those cases, but we hope and believe that the majority of mothers will become accustomed to the four-weekly payment of benefits and will be able to cope with the system. Benefits are payable monthly throughout Europe. Surely the Opposition are not telling me that the British housewife is less capable than the Continental housewife of managing her financial affairs. That is the implication of all that has been said by Labour Members. They treat the British public as cretins.
New mothers—those whose entitlement begins on or after 15 March 1982—will be paid child benefit at four-weekly intervals, on the Monday or Tuesday in the fourth week, unless they are in one of the categories that have the right to choose to be paid weekly. The position will be explained in a note attached to their child benefit claim form when they first apply for benefit.
The great difficulty for existing mothers in switching to four-weekly payment will have been at the point of change, because they had become accustomed to weekly payments. We do not believe that that difficulty will be so obvious for new mothers. I have dealt with the anxieties expressed in comments on the White Paper.
We expect that some mothers will have difficulty with four-weekly payments and we have therefore provided in the regulations that lone parents, including widows, and families in receipt of supplementary benefit or FIS will have the right to choose to be paid weekly.
We believe that these provisions will cover the main groups that are likely to have difficulty in coping with the four-weekly payment of child benefit. The hardship

721
provisions will remain for those who do not fall within the categories that I have outlined but who feel that they are experiencing hardship because of—
It being half-past Eleven o'clock, Mr. Deputy Speaker put the Question, pursuant to Standing Order No. 4 (Prayers against statutory instruments, &c. (negative procedure)).
The House divided: Ayes 208, Noes 275.

Division No. 48]

[11.30pm

AYES

Abse, Leo

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

Adams, Allen

Freeson, RtHon Reginald

Allaun, Frank

Freud, Clement

Alton, David

Garrett, John (NorwichS)

Anderson, Donald

Golding, John

Archer, Rt Hon Peter

Graham, Ted

Ashton, Joe

G rant, George (Morpeth)

Atkinson, N.(H'grey)

Hamilton, James(Bothwell)

Bagier, GordonA.T.

Hamilton, W. W. (C'tralFife)

Barnett, Guy(Greenwich)

Harrison, RtHon Walter

Barnett, RtHon Joel (H'wd)

Hart, Rt Hon Dame Judith

Beith, A.J.

Haynes, Frank

Benn, RtHon Tony

Heffer, EricS.

Bennett, Andrew(St'kp'tN)

Hogg, N. (EDunb't'nshire)

Bidwell, Sydney

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

Boothroyd, MissBetty

HomeRobertson, John

Bray, Dr Jeremy

Homewood, William

Brown, HughD. (Provan)

Hooley, Frank

Brown, R.C. (N'castleW)

Howells, Geraint

Brown, Ron(E'burgh, Leith)

Hoyle, Douglas

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

Huckfield, Les

Campbell, Ian

Hughes, Mark(Durham)

Campbell-Savours.Dale

Hughes, Robert (Aberdeen N)

Canavan, Dennis

Hughes, Roy (Newport)

Cant, R. B.

Janner, HonGreville

Carmichael, Neil

Jay, RtHon Douglas

Clark, Dr David (S Shields)

John, Brynmor

Cocks, Rt Hon M. (B'stolS)

Johnson, James (Hull West)

Cohen, Stanley

Johnson, Walter (Derby S)

Coleman, Donald

Johnston, Russell (Inverness)

Concannon, Rt Hon J. D.

Jones, Rt Hon Alec (Rh'dda)

Conlan, Bernard

Jones, Barry (East Flint)

Cook, Robin F.

Jones, Dan (Burnley)

Cowans, Harry

Kaufman, Rt Hon Gerald

Craigen, J. M. (G'gow, M'hill)

Kerr, Russell

Crowther, Stan

Kilroy-Silk, Robert

Cryer, Bob

Lambie, David

Cunliffe, Lawrence

Lamborn, Harry

Cunningham, DrJ.(W'h'n)

Lamond, James

Dalyell, Tam

Leadbitter, Ted

Davidson, Arthur

Leighton, Ronald

Davies, Rt Hon Denzil (L 'lli)

Lestor, Miss Joan

Davis, Clinton (Hackney C)

Lewis, Arthur (N'hamNW)

Davis, Terry (B'ham, Stechf'd)

Lewis, Ron (Carlisle)

Dean, Joseph (Leeds West)

Litherland, Robert

Dewar, Donald

Lofthouse, Geoffrey

Dixon, Donald

Lyon, Alexander(York)

Dobson, Frank

McCartney, Hugh

Dormand, Jack

McDonald, DrOonagh

Douglas, Dick

McElhone, Frank

Dubs, Alfred

McKay, Allen (Penistone)

Dunnett, Jack

McKelvey, William

Dunwoody, Hon Mrs G.

MacKenzie, RtHonGregor

Eadie, Alex

McNamara, Kevin

Ellis, R. (NED'bysh're)

McTaggart, Robert

English, Michael

McWilliam, John

Ennals, Rt Hon David

Marks, Kenneth

Evans, loan (Aberdare)

Marshal, I, D (G 'go wS 'ton)

Evans, John (Newton)

Marshall, Jim (LeicesterS)

Ewing, Harry

Martin, M(G'gowS'burn)

Faulds, Andrew

Mason, Rt Hon Roy

Field, Frank

Maxton, John

Flannery, Martin

Maynard, MissJoan

Foot, RtHon Michael

Meacher, Michael

Ford, Ben

Mikardo, lan

Forrester, John

Millan, RtHonBruce

Foster, Derek

Mitchell, Austin(Grimsby)

Foulkes, George

Morris, Rt Hon A. (W'shawe)

722

Moyle, RtHon Roland

Soley, Clive

Newens, Stanley

Spearing, Nigel

Oakes, Rt Hon Gordon

Spriggs, Leslie

Orme, Rt Hon Stanley

Steel, Rt Hon David

Palmer, Arthur

Stoddart, David

Park, George

Stott, Roger

Parker, John

Straw, Jack

Parry, Robert

Summerskill, HonDrShirley

Pendry, Tom

Thomas, Dafydd(Merioneth)

Penhaligon, David

Thomas, DrR. (Carmarthen)

Pitt, William Henry

Thorne, Stan (PrestonSouth)

Powell, Raymond (Ogmore)

Tilley, John

Prescott, John

Tinn, James

Price, C. (Lewisham W)

Torney, Tom

Race, Reg

Varley, RtHon EricG.

Radice, Giles

Wainwright, E.(DearneV)

Rees, Rt Hon M (Leeds S)

Wainwright, R.(Colnev)

Richardson, Jo

Walker, Rt Hon H.(D'caster)

Roberts, Albert(Normanton)

Watkins, David

Roberts, AlIan (Bootle)

Weetch, Ken

Roberts, Ernest (Hackney N)

Welsh, Michael

Roberts, Gwilym(Cannock)

White, Frank R.

Robinson, G. (Coventry NW)

White, J.(G'gowPollok)

Rooker, J. W.

Whitehead, Phillip

Ross, Ernest (Dundee West)

Whitlock, William

Ross, Stephen (Isle of Wight)

Wigley, Dafydd

Rowlands, Ted

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

Ryman, John

Wilson, RtHonSirH.(H ton)

Sheerman, Barry

Wilson, William (C'trySE)

Sheldon, RtHon R.

Winnick, David

Shore, RtHon Peter

Woodall, Alec

Short, Mrs Renée

Woolmer, Kenneth

Silkin, RtHonJ. (Deptford)

Wright, Sheila

Silkin, Rt Hon S. C. (Dulwich)

Young, David (BoltonE)

Silverman, Julius

Skinner, Dennis

Tellers for the Ayes:

Smith, RtHonJ. (N Lanark)

Dr. Edmund Marshall and

Snape, Peter

Mr. George Morton.

NOES

Adley, Robert

Cadbury, Jocelyn

Aitken, Jonathan

Carlisle, John (Luton West)

Alexander, Richard

Carlisle, Kenneth(Lincoln)

Alison, RtHon Michael

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

Amery, RtHon Julian

Chalker, Mrs. Lynda

Ancram, Michael

Channon, Rt. Hon. Paul

Arnold, Tom

Churchill, W.S.

Aspinwall, Jack

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

Atkins, Robert(PrestonN)

Clark, SirW. (CroydonS)

Baker, Kenneth(St.M'bone)

Clarke, Kenneth(Rushcliffe)

Baker, Nicholas (N Dorset)

Clegg, SirWalter

Beaumont-Dark, Anthony

Cockeram, Eric

Bendall, Vivian

Cope, John

Benyon, Thomas(A'don)

Corrie, John

Benyon, W.(Buckingham)

Costain, SirAlbert

Best, Keith

Cranborne, Viscount

Sevan, DavidGilroy

Critchley, Julian

Biffen, RtHon John

Crouch, David

Biggs-Davison, SirJohn

Dean, Paul (North Somerset)

Blackburn, John

Dickens, Geoffrey

Blaker, Peter

Dorrell, Stephen

Body, Richard

Douglas-Hamilton, LordJ.

Bonsor, SirNicholas

Dover, Denshore

Bottomley, Peler(W'wich W)

du Cann, Rt Hon Edward

Bowden, Andrew

Dunn, Robert(Dart ford)

Boyson, DrRhodes

Dykes, Hugh

Braine, SirBernard

Eden, RtHon Sir John

Bright, Graham

Eggar, Tim

Brinton, Tim

Elliott, SirWilliam

Brittan, Rt. Hon. Leon

Emery, Sir Peter

Brooke, Hon Peter

Eyre, Reginald

Brotherton, Michael

Fairgrieve, SirRussell

Brown, Michael(Brigg&Sc'n)

Faith, MrsSheila

Browne, John(Winchester)

Farr, John

Bruce-Gardyne, John

Fell, Sir Anthony

Bryan, Sir Paul

Fenner, Mrs Peggy

Buck, Antony

Finsberg, Geoffrey

Budgen, Nick

Fisher, SirNigel

Bulmer, Esmond

Fletcher, A. (Ed'nb'ghN)

Butcher, John

Fletcher-Cooke, SirCharles

723

Fookes, Miss Janet

Maude, Rt Hon Sir Angus

Forman, Nigel

Mawby, Ray

Fowler, Rt Hon Norman

Mawhinney, DrBrian

Fox, Marcus

Maxwell-Hyslop, Robin

Fraser, Peter (South Angus)

Mayhew, Patrick

Gardiner, George(Reigate)

Mellor, David

Gardner, Edward (SFylde)

Meyer, Sir Anthony

Garel-Jones, Tristan

Miller, Hal(B'grove)

Gilmour, RtHonSirlan

Mills, lain(Meriden)

Glyn, DrAlan

Mills, Peter (West Devon)

Goodhew, SirVictor

Miscampbell, Norman

Goodlad, Alastair

Mitchell, David(Basingstoke)

Gorst, John

Monro, SirHector

Gow, Ian

Montgomery, Fergus

Gray, Hamish

Moore, John

Greenway, Harry

Morgan, Geraint

Griffiths, Peter Portsm'thN)

Morris, M. (N'hamptonS)

Grist, Ian

Morrison, HonC. (Devizes)

Grylls, Michael

Morrison, Hon P. (Chester)

Gummer, JohnSelwyn

Mudd, David

Hamilton, HonA.

Murphy, Christopher

Hamilton, Michael (Salisbury)

Myles, David

Hampson, DrKeith

Neale, Gerrard

Hannam, John

Needham, Richard

Haselhurst, Alan

Nelson, Anthony

Hastings, Stephen

Neubert, Michael

Havers, Rt Hon Sir Michael

Newton, Tony

Hawksley, Warren

Normanton, Tom

Hayhoe, Barney

Nott, Rt Hon John

Heath, Rt Hon Edward

Onslow, Cranley

Henderson, Barry

Oppenheim, Rt Hon Mrs S.

Hicks, Robert

Page, Richard (SWHerts)

Higgins, Rt Hon Terence L.

Parkinson, RtHon Cecil

Hogg, HonDouglas(Gr'th'm)

Parris, Matthew

Holland, Philip(Carlton)

Patten, Christopher(Bath)

Hooson, Tom

Pattie, Geoffrey

Hordern, Peter

Pawsey, James

Howe, Rt Hon Sir Geoffrey

Percival, Sirlan

Howell, RtHonD.(G'ldf'd)

Pink, R.Bonner

Hunt, David (Wirral)

Pollock, Alexander

Hunt, John(Ravensbourne)

Prentice, RtHon Reg

Irving, Charlesf(Cheltenham)

Proctor, K. Harvey

Jenkin, RtHon Patrick

Pym, Rt Hon Francis

JohnsonSmith, Geoffrey

Raison, Timothy

Jopling, Rt Hon Michael

Rathbone, Tim

Kaberry, SirDonald

Rees-Davies, W. R.

Kellett-Bowman, MrsElaine

Renton, Tim

Kershaw, SirAnthony

Rhodes, James, Robert

King, Rt Hon Tom

RhysWilliams, SirBrandon

Knox, David

Ridley, HonNicholas

Lament, Norman

Ridsdale, SirJulian

Lang, Ian

Roberts, M. (Cardiff NW)

Langford-Holt, SirJohn

Roberts, Wyn (Conway)

Latham, Michael

Rossi, Hugh

Lawrence, Ivan

Rost, Peter

Lawson, Rt Hon Nigel

Royle, SirAnthony

Lee, John

Sainsbury, HonTimothy

LeMarchant, Spencer

St. John-Stevas, Rt Hon N.

Lennox-Boyd, HonMark

Shew Giles (Pudsey)

Lestor, Miss Joan

Shaw, Michael (Scarborough)

Lewis, Kenneth (Rutland)

Shelton, William(Streatham)

Lloyd, Ian (Havant& W'loo)

Shepherd, Colin (Hereford)

Loveridge, john

Shepherd, Richard

Luce, Richard

Shersby, Michael

Lyell, Nicholas

Silvester, Fred

McCrindle, Robert

Sims, Roger

Macfarlane, Neil

Skeet, T. H. H.

MacGregor, John

Speed, Keith

MacKay, John (Argyll)

Speller, Tony

Macmillan, RtHonM.

Spence, John

McNair-Wilson, M.(N'bury)

Spicer, Jim (West Dorset)

McNair-Wilson, P. (NewF'st)

Spicer, Michael (S Worcs)

McQuarrie, Albert

Squire, Robin

Madel, David

Stanbrook, lvor

Major, John

Stanley, John

Marland, Paul

Stevens, Martin

Marlow, Antony

Stewart, A. (ERenfrewshire)

Marshall, Michael (Arundel)

Stokes, John

Marten, Rt Hon Neil

Stradling, Thomas, J.

Mates, Michael

Tapsell, Peter

724

Taylor, Teddy (S'endE)

Ward, John

Tebbit, Rt Hon Norman

Watson, John

Temple-Morris, Peter

Wells, Bowen

Thomas, Rt Hon Peter

Wells, Joh n (Maidstone)

Thompson, Donald

Wheeler, John

Thorne, Neil(llfordSouth)

Whitelaw, RtHonWilliam

Thornton, Malcolm

Whitney, Raymond

Townend, John(Bridlington)

Wickenden, Keith

Townsend, Cyril D, (B'heath)

Wiggin, Jerry

Trippier, David

Wilkinson, John

Trotter, Neville

Williams, D. (Montgomery)

van, Straubenzee, Sir W.

Winterton, Nicholas

Vaughan, DrGerard

Wolfson, Mark

Viggers, Peter

Young, SirGeorge (Acton)

Wakeham, John

Younger, RtHon George

Waldegrave, HonWilliam

Walker, RtHon P.(W'cester)

Tellers for the Noes:

Walker-Smith, Rt Hon Sir D.

Mr. Anthony Berry and

Waller, Gary

Mr. Robert Boscawen.

Walters.Dennis

Question accordingly negatived.

European Community (Trade Marks Office)
Motion made, and Question proposed, That this House do now adjourn. —[Mr. Gummer.]
11.41 pm
Mr. Tom McNallyIn asking to debate the siting of the European Community trade marks office, Mr. Deputy Speaker, I realised that you and many other hon. Members might believe that this was yet another example of a Member wanting to advance special pleading for a constituency interest, but I hope that the House will think of the matter in broader terms.
We must now start making civil servants and, more important, pro tem Ministers think about what they will do on the subject. I hope to hear from the Under-Secretary of State for Trade about use of the EEC, of which I have been a long standing supporter, as an instrument of industrial and regional policy.
I have raised the matter not because I want to pit Greater Manchester against Greater London, or even Stockport against Hammersmith, but because I believe that the Minister has missed an opportunity to use EEC policy to develop the idea of industrial and regional policy in this country as part of overall EEC policy. That is where I accuse him of failing.
The Minister should observe that the hon. Members for Stockport, North, (Mr. Bennett), Manchester, Moss Side (Mr. Morton), Manchester, Withington (Mr. Silvester) and Cheadle (Mr. Normanton) are present. Although there is no opportunity to cover the whole range of issues involved, since this is a cramped debate at the end of a day's sitting, they are here because they suspect that yet again the old London idea is being applied that if the site is not to be London it will be nowhere in this country—the idea that the country stops at Watford.
Over the last few years in Greater Manchester, there has been a commitment to the Manchester international airport, which is a most impressive piece of public

725
authority enterprise. It is the fastest growing international airport in Europe. In Greater Manchester there is the best developed road system anywhere in Britain. The Minister must know those statistics, too. He must know that in Greater Manchester there is an investment in office development that is as good as anywhere in the Metropolis.
The glossy brochure that has been published is paid for not by the Minister's Department, but by the Greater London Council, which is a little saving on public spending. It shows the Old Lady in her most attractive garb, but does not explain that if one has a regional policy and wants to develop opportunities for industry, one must have the courage, which the Department of Trade has never had, to look to the North.
In the brochure, arguments are put forward on subjects such as housing. The Department knows that that argument does not stand up. Airports are referred to. As I have already said, Manchester is the fastest growing airport in Europe.
I should like to know from the Minister what is better in London than in Greater Manchester. I should like to put into his mind and the minds of his officials the idea that we will not let him sell us out once again. Will he put forward two alternatives to Europe? What has been suggested in Europe cannot compete with London and Manchester.
I am not here to blackguard London, as I came to London as a simple North country lad 20 years ago. I enjoyed London, and spent 20 happy years here. However, I am not always willing to hear the Department of Trade say "London, London, London."
The Minister should have the courage to say that there is a London opportunity, but there is a city to the North of London that can serve as a site, and has many, if not more, of the qualities mentioned in the brochure. Why does he not have the courage to say that the challenge of his Department is that it will sell somewhere other than London? That is a view that the Minister will hear more than once tonight.
11.48 pm
Mr. Tom NormantonI congratulate the hon. Member for Stockport, South (Mr. McNally) on having raised this issue as a subject for the Adjournment debate. It is matter of tremendous importance, of far greater importance to the North-West than some hon. Members may assess.
It would not be appropriate for me, in the short time available, to concentrate on adding to any eulogy that would make the siting of the trade marks office in Manchester more promising and more worth while. I shall therefore concentrate on making two brief comments.
First, I believe that when the Council of Ministers makes a decision on an institutional matter of this kind, which is in itself a major policy decision, it will be heavily influenced by two factors. First, I believe that the more Members of Parliament, both within and outside the House, clamour for Britain to withdraw from the Community, the more certain will be the Council's decision to site the institution elsewhere. If I were member of the Council, I would expect consistent demonstrations of unwillingness to remain a member of the Community to lead the Council to reject out of hand any question of siting the institution in Britain.
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Secondly—and perhaps the Minister will make some observations on this—history shows that Community decisions in matters of this kind are almost invariably made within the framework of a package or deal. I hope that when the Minister takes part in the Council's proceedings he will have in mind the nature of a package on the basis of which he is prepared to negotiate. History has shown that the merit of the case is not the main raison d'être and does not necessarily guarantee a decision based on merit alone. It is the nature of the package and the way in which it is negotiated that is important. I should be interested to hear some brief comment from my hon. Friend the Minister on that point.
11.52 pm
Mr. Fred SilvesterWith the permission of the hon. Member for Stockport, South (Mr. McNally), I should like to add just one and a half minutes to the debate.
The Minister knows my view, as I have already been to see him with the chamber of commerce. I shall not go into it in detail, except to make two points. First, this situation is not really the Minister's fault, as I understand that the original decision was made in 1973.
It has been reaffirmed many times since then, because whichever Government are in power we are up against the same inevitable cycle. Because certain resources have been concentrated in London, one then makes the case that the resources around which one has to concentrate are in London, and so it goes on like a merry-go-round. To my disappointment, we did not receive the support that we expected from the Institute of Trade Mark Agents, whose letter to the chamber of commerce was a classic example of the same argument.
I know that we shall not get far with the Minister tonight, but I must tell him that I believe that the Government have missed an opportunity, for this reason. I understand that the other contenders in Europe are Strasbourg, The Hague and Brussels. As has been said, much of this will be done through a deal in any case. I believe that the regional argument advanced so cogently today and on other occasions might have carried considerable weight. We are dealing with one of the last EEC institutions available for placing outside Brussels. I believe that the claims of Brussels and Strasbourg would in fact turn out to be rather weak, but that the claim of The Hague would be very strong.
The Government have missed a golden opportunity to add a new dimension, which is currently much in fashion in the EEC, in establishing the claim for this country.
11.55 pm
The Under-Secretary of State for Trade (Mr. Reginald Eyre)Let me say at the outset, in reply to the strong plea developed by the hon. Member for Stockport, South (Mr. NcNally), that I fully support the need to give the regions every help and encouragement to redress the imbalance between different parts of the country. Indeed, I have repeatedly given my support to regional projects. I am glad to say that as a Birmingham man and as a Birmingham Member of Parliament. I would gladly do so on this occasion if I thought that it would lead to a successful outcome for the United Kingdom. That is the question that I want to keep in mind during this debate.
If the European Council proposed, come what may, to site a Community trade marks office in the United

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Kingdom, we might be free to put forward any number of sites other than London. But that is not the position. We are in an intensely competitive situation.
The French want the office in Strasbourg. The Dutch want the office in The Hague. The Belgians want the office in Brussels. They have made formal offers to receive the office. I was interested in the assessment of the relative value of the claims by my hon. Friend the Member for Manchester, Withington (Mr. Sylvester). I shall not comment on his judgment, but I agree that The Hague is a strong contender in the competition.
I hear that the Italians and the Irish are contemplating offering a site. There is keen competition to secure the office, even before the necessary framework for establishing an office has been agreed. I recognise the knowledge of European affairs that my hon. Friend the Member for Cheadle (Mr. Normanton) possesses but when there are competitive applications by member States it is not possible to present a package of the type that he suggests.
If we were not too concerned about the eventual location of this office in the Community and were not too serious in our bid, we might adopt a different approach on a possible site in the United Kingdom. But again, that is not the position. We are deeply concerned to secure the office for this country. The Government attach the highest importance to their wish to have the Community trade marks office here in the United Kingdom.
The United Kingdom has always been at the forefront of industrial property matters—and rightly so, given the crucial part that international trade plays in our economy. But already we see a movement of industrial property work away from this country, following the opening of the European patent office in Munich. This trend could accelerate if the Community trade marks office were located elsewhere than in the United Kingdom. So we are deeply concerned about the location of this new office and believe that the national interest demands that we offer our strongest candidate. It is not a question of offering a site as good as our rivals, but of offering a site that is demonstrably better.
I have mentioned the European patent office. One reason why we did not succeed in attracting the European patent office was the lateness of our bid consequent upon our lateness in joining the EEC. We were not late in our bid for the Community trade marks office. We first made our offer of London as long ago as 1973. Successive Governments repeated the offer of London in 1976, 1978, 1980 and, most recently, earlier in January of this year.
In reaching that decision in 1973 to offer London as a site for the proposed office, the Government carefully weighed the needs of the regions against the need to secure this office in the United Kingdom and concluded that the need to secure the office in the United Kingdom meant that we had to offer our most advantageous location, the location most likely to succeed with our Community partners. This means London, and the reasons for choosing London are reflected quite forcefully in the early-day motion laid before this House in 1978. If I may remind the House of that motion, it read:
"That this House calls upon Her Majesty's Government to consider with urgency the siting of the European Community trade mark office and to make strong representations to the Governments of the other member States to the effect that London is the best and the most appropriate site for the said office
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having regard to all material considerations and in particular the size and vast experience of the London registry over a period of 100 years in decision-making, the expertise and support facilities of British trade mark practitioners, the advantage of English-speaking practice deriving from the fact that the majority of world trade is conducted in English, and London's accessibility in respect of communications, and thereby ensure the provision of the best possible service for practitioners and for the Community as a whole".
That motion was supported by over 50 hon. Members, by no means drawn exclusively from the South-East, and that says a great deal. London would ensure the provision of the best possible service for practitioners and for the Community as a whole.
I should like to go over the reasons that led us to propose London rather than some other site. I ask the hon. Member for Stockport, South to believe me when I say that I appreciate fully the sincerity of his view. London is the site of the United Kingdom trade marks registry. This inevitably means that the expertise and support facilities for trade mark practitioners centres on London. Even where there are practitioners located outside the London area, they will already have London on their itineraries as a result of their work before the United Kingdom office. If the decision were taken to locate the Community trade marks office outside London, the profession would face some disruption and might be faced with difficult location problems.
It is true that Manchester houses a small branch of the trade marks registry. However, we are talking about a regional office employing a handful of people compared with 200 people at the head registry in London. The figures for trade mark practitioners are of a similar order, say 50 in Manchester compared with 500 in London. This fact is fully recognised by the Institute of Trade Mark Agents, which has recently written to me giving its full backing to the Government's choice of London.
I am grateful to my hon. Friend the Member for Withington. I understand his devotion to Manchester and his support—together with that of my hon. Friend the Member for Cheadle—for the Manchester case. My hon. Friend the Member for Withington was fair when he referred to the meeting held with the Institute of Trade Mark Agents on the important question of the siting of the office. I wish to emphasise that the institute has given full backing to the Government's choice of London.
Next, there is the question of travel connections. It is true that Manchester and some other regions have good air connections with Europe and some other parts of the world. My Department is proud of the contribution it has made to the success of Manchester airport in that respect. But none of the travel connections compares with London. Over 85 per cent. of applications for Community trade marks are expected to arise from abroad. In fact, it is expected that over 50 per cent. of applications will originate from outside the Community itself. So, in my view, the Community trade marks office will need to be located in a town that has good air connections with all parts of the world.
Mr. Andrew F. BennettDoes not the Minister realise that there are sites around Manchester airport which, if one enters this country via Heathrow and flies on to Manchester, can be reached quicker than by arriving at Heathrow and then having to travel into London?
Mr. EyreI do not say that Manchester is not an absolutely splendid travel centre. I am glad that it is, and I hope that it will contribute substantially to the success of Manchester in the future. I believe that it will. However, I ask the hon. Gentleman to consider all the points that I am making, of which travel is one, and an important point. Despite what the hon. Gentleman says, the fact is that the facilities at Gatwick and Heathrow cannot be matched in their international connections by any other airport in the United Kingdom.
Next, London offers unrivalled facilities to the foreign staff who would be required to settle in this country and work in the office—probably 100 out of the 200 total staff involved in the office; a very important consideration in seeking to attract foreign votes—which are necessary—for the siting of the office in London.
So, for all these reasons, the Government settled on London in 1973. London remains our choice, and I can turn to our Community partners and tell them frankly that a decision to establish the Community trade marks office in London would contribute substantially to the very success of the office itself.
Finally, I would like to remind the House of my written answer on 18 January to the question tabled by my hon. Friend the Member for East Grinstead (Mr. Johnson Smith).
In my reply, I stated that the Department of Trade had joined with the Greater London Council in the production of a brochure putting the case for London. A copy of this brochure was placed in the Library on 13 January, and it is currently being sent to the European Council, the Commission, Members of the European Parliament, and to professional and commercial organisations throughout the Community. I am glad that the hon. Member referred to the brochure in his speech.
I know that this is disappointing news for hon. Members who represent constituencies in and near
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Manchester. I have tried to explain the overwhelmingly strong reasons which impel us to put forward the bid for the office to be sited in London. I genuinely believe that we cannot succeed in our competitive bid unless we put forward our strongest case in this way.
It is in the national interest to bring this organisation to the United Kingdom, and I therefore hope that the various interests concerned can combine to present a united front to our Community partners.
12.8 am
Mr. Andrew F. BennettAs there are a few minutes left, may 1 say how disappointed I ant by the Minister's news. I am particularly disappointed that he did not respond to the points that were made. If he does not offer this office to Manchester, what else can he offer?
If the Minister wants to convince people in this country that the Common Market has something to offer this country, he should explain how he will stop the Common Market from dragging everything into the triangle between London, Paris and Brussels. This was an opportunity for the Minister to put the argument within the Common Market that we want a regional policy that will influence the placing of its institutions, but he has allowed another institution to be dragged into that triangle.
Many people become disillusioned when they see resources drained from their area. Why should the people of Manchester support this sort of centre, as they will do through their taxes, when they get nothing back into their area? The Minister should think hard and bring forward firm proposals to provide benefits for the regions within the Common Market, particularly the North-West, where everyone accepts that we have first-class facilities. Civil servants and Ministers should have confidence in us and sell us in the way that they are prepared to sell London.
Question put and agreed to.
Adjourned accordingly at nine minutes past Twelve o'clock.