Commons Sitting of 15 December 1983

Preamble
The House met at half-past Two o'clock
PRAYERS
[MR. SPEAKER in the Chair]
PRAYERS
  PRIVATE BUSINESS
    BRITISH RAILWAYS BILL
    Read the Third time and passed.

    NOTTINGHAMSHIRE COUNTY COUNCIL BILL [Lords] (By Order)
    Order for consideration, as amended, read.
    To be considered upon Tuesday 20 December.

    NOTTINGHAMSHIRE COUNTY COUNCIL BILL [Lords] (By Order)
      SHREWSBURY AND ATCHAM BOROUGH COUNCIL BILL [Lords] (By Order)

        TEES AND HARTLEPOOL PORT AUTHORITY BILL (By Order)
        Orders for Second Reading read.
        To be read a Second time upon Thursday 19 January 1984.

        TEES AND HARTLEPOOL PORT AUTHORITY BILL (By Order)

          DARTFORD TUNNEL BILL [Lords] (By Order)
          Order for Second Reading read.
          To be read a Second time upon Tuesday 20 December.

Oral Answers to Questions
  AGRICULTURE, FISHERIES AND FOOD

    Common Agricultural Policy
    Sir Geoffrey Johnson Smithasked the Minister of Agriculture, Fisheries and Food what is the policy of Her Majesty's Government towards the Community's proposals for changes in the agri-marketing system for the Community's agricultural policy.
    Mr. Deakinsasked the Minister of Agriculture, Fisheries and Food what progress has been made in reducing the costs of the common agricultural policy; and if he will make a statement.
    The Minister of Agriculture, Fisheries and Food (Mr. Michael Jopling): In the Government's view the vital need is to contain agricultural expenditure by action on farm prices and by other means.
    Sir Geoffrey Johnson-Smith: I welcome my right hon. Friend's answer, but assuming that he supports measures that would remove tedious and bureaucratic proposals such as compelling honey producers to indentify
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    on the labels the flowers on which the bees feed, may I have his reassurance, particularly on poultry and dairy produce, that he will uphold the necessary traditional standards of health regulations in this country and not allow them to be reduced on the ground of freer trade?
    Mr. Jopling: I am grateful to my hon. Friend, and I can tell him that the bees are constantly on my mind. We have been discussing animal health in Brussels this week, and in particular we have been able to obtain a roll-over of the arrangements which give us protection from foot and mouth disease.
    Mr. Deakins: At the recent Athens summit, how many other member Governments agreed with Her Majesty's Government's proposition that cost increases in the CAP should be kept within the limits of own resources cost increases? Will that proposition remain the firm policy of the Government during the months of negotiation ahead?
    Mr. Jopling: The hon. Gentleman will recall that since July and the Stuggart summit we have continually been making clear our view that the best way to deal with the crisis in the Community is to tackle it through the device of price fixing. We shall continue to plead that cause. Within the Community, we have to bear in mind that we must get agreement. Therefore, as I said in my answer, we shall use every device available to us.
    Mr. Marlow: As an example of one such device, now that the Strasbourg comic opera has decided to confiscate £450 million of British taxpayers' money, will my right hon. Friend do the logical thing and get out of this whole wretched, rotten agri-marketing business known as the common agricultural policy and do something for British consumers as well as for the British farmer?
    Mr. Jopling: I am surprised that my hon. Friend said that. The answer to the main part of his question is no, it is not our intention to leave the Community and scrap the common agricultural policy. I am particularly surprised at what he said, because he seems to have forgotten that in recent years the price of food has gone up at a slower rate than the price of other things.
    Mr. Ioan Evans: Does the Minister agree that it is because of the common agricultural policy that we are one of the two main contributors to Common Market funds? As the European Parliament has frozen the rebate of the £450 million which we oversubscribed to the fund, does he not think that there should be a fundamental reform of the CAP and that we should revert to the agriculture support system that we had before we joined the Common Market, which was better for the consumer and for the producer?
    Mr. Jopling: I cannot accept the first part of the hon. Gentleman's question. I reject the suggestion in the second part that we should revert to what I regard as one of the most disastrous policies for British agriculture, that of guaranteed prices and deficiency payments. If the hon. Gentleman were to pursue that line he would saddle the taxpayers of this country with an extra burden of about £2·25 billion.
    Mr. Robert Hughes: Is it not true that the net cost to the United Kingdom of the CAP is £3·5 billion per annum? Is it not also true that food prices are now rising faster than the average RPI? Will the Minister at least acknowledge — as I acknowledge, and I should be grateful if he

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    would admit — that he stands four-square behind the CAP, as a result of which the consumer gets ever dearer and dearer food?
    Mr. Jopling: We are trying very hard to get changes in the common agricultural policy. The hon. Gentleman knows — and he heard the speech that I made in the House the other day which demonstrated this—the ways in which we are trying to change it as best we can. He will recall that not many months ago there was a zero increase in the price of food. He should know that the price of food is seasonal and has a habit of going up and down.

    Straw and Stubble Burning
    Mr. Tom Coxasked the Minister of Agriculture, Fisheries and Food if he will seek to meet the Agriculture Committee of the Council of Europe to discuss the problems caused by the burning of straw and stubble waste.
    The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mrs. Peggy Fenner): We shall be happy to give due consideration to any views of the Agriculture Committee of the Council of Europe on straw and stubble burning which it may care to communicate to us.
    Mr. Cox: I note the Minister's reply, but is she aware that the procedure followed in many European countries for the disposal of straw waste is very different from the procedures here and that that is why such discussions could be of benefit? Is she further aware that if there is to be an end next summer to the abuses that occurred in many parts of this country this year, the statements that the Government have been making about the actions that they intend to take will have to be implemented, with legislation to back them up?
    Mrs. Fenner: Conditions vary in the different European countries. In some countries there is greater integration of livestock and arable production than happens in the major straw producing areas of the United Kingdom. The soil and weather conditions also differ. In answer to the hon. Gentleman's last point, I assure him that we are in the process of discussing new model byelaws, which will be considerably tougher than the existing byelaws.
    Mr. Farr: Will my hon. Friend bear in mind that it would be helpful if she and her right hon. Friends, before next summer, were to introduce an entirely revised, very strict and quite voluntary code on straw burning, because the present system has not worked? Does she accept that a voluntary code, on an amended basis, should be introduced?
    Mrs. Fenner: We have been discussing with the National Farmers Union a stronger code for straw burning, but it will be backed by new model byelaws, which will be considerably tougher than the existing ones. We trust that that will be done in time for district councils to make their byelaws before the next season.
    Mr. Freud: Will the Minister tell the House what encouragement she would give to industry to take up the surplus straw and stubble and manufacture it into briquettes, either for heating or for cattle food?
    Mrs. Fenner: For some time my Ministry has involved industrialists in a group looking at ways of using surplus
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    straw. There are a number of ways of doing so and we are contributing £2 million to research into those ways. I know the particular way that the hon. Gentleman has in mind, and I hope very much that all these ways can be made commercial. That is what is relevant.
    Sir Paul Hawkins: Will my hon. Friend consider encouraging livestock production in corn-producing areas so that the straw that is produced from corn is consumed nearer to the farms?
    Mrs. Fenner: My hon. Friend will be aware that over several years we have played our part in Europe in trying to redress the balance between cereals and livestock. He will be aware also that many of Britain's grasslands, by their very nature, are on the other side of the country from the main cereal-producing areas.

    Milk
    Mr. Nicholas Bakerasked the Minister of Agriculture, Fisheries and Food what percentagae of total liquid milk consumed in the United Kingdom is sold through producer retailers.
    The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. John MacGregor): Information provided by the Milk Marketing Board indicates that producer retailer sales accounted for about 3·4 per cent. of total liquid milk sales in the United Kingdom in the year ended 31 March 1983.
    Mr. Baker: My hon. Friend will be aware of the great concern in the dairy industry about EEC proposals for a super levy. What does he think will happen to the percentage of liquid milk sales by producer-retailers in the unlikely and possibly disastrous event of the Commission's super levy proposals being implemented?
    Mr. MacGregor: If a super levy were introduced—my hon. Friend will know from the recent debate that there is no commitment to that—much would depend on the form in which it was brought in. If it were the original Commission proposal, which did not cover milk sold by producer-retailers, I expect that the sales of liquid milk by producer-retailers would rise. That would be a positive incentive to go into producer-retailing. We believe that if such a systen were introduced this would undermine the effectiveness of the levy and distort the market. That is why we have been pressing for producer-retailers to be included if a super levy is introduced.
    Mr. J. Enoch Powell: The Minister has given the United Kingdom figure. Can he give the Northern Ireland component percentage?
    Mr. MacGregor: I regret to say that I do not have the figures for Northern Ireland. I shall write to the right hon. Gentleman and supply them. Producer-retailer sales are higher in certain other Community countries than in the United Kingdom. That is an additional reason for ensuring that any super levy covers them.
    Mr. Teddy Taylor: Is the Minister aware of the serious gloom and concern among milk producers and retailers as they face the prospect of being clobbered because of an uncontrollable surplus on the continent of Europe at a time when Britain is just about self-sufficient? Would not many of my hon. Friend's problems be solved if he proposed to the EEC that we should take milk out of the common agricultural policy?
    Mr. MacGregor: We had a long debate recently on who was responsible for the surpluses. The United Kingdom is very nearly self-sufficient and contributes to some of the surpluses in stock. It would be dangerous to argue for exemptions for any individual country, because we would not come best out of that. To remove milk from the CAP is not a practical proposition.
    Mr. Taylor: Why?
    Mr. Mark Hughes: Will the Minister assure the House that he will not allow a major distortion of the milk marketing schemes to occur due to an expansion of producer-retailing in Britain, which the levy scheme could produce? Secondly, where is the Newhaven consignment of UHT milk?
    Mr. MacGregor: I have already said that we believe that if there were a super levy—I repeat "if'—officially it should cover producer-retailers. If it did not, it would undermine the system. As for the Newhaven consignment, the local authority concerned is examining that milk.

    Sheep
    Mr. Kirkwoodasked the Minister of Agriculture, Fisheries and Food what representations he has made to the European Economic Community on the continuance of the sheep regime.
    Mr. MacGregor: The Commission, in its report to the Council on the functioning of the sheepmeat regime, expresses the view that the main features of the regime can remain in the future. It has, however, proposed a number of adjustments to the mechanisms of the regime and we are examining the implications of these proposals.
    Mr. Kirkwood: There is widespread concern in the industry in the sheep-rearing areas about the Commission's proposal to limit the variable premium to 25 per cent. of the guide price. As the variable premium scheme operates only in this country, would that not discriminate against the sheep industry in Britain?
    Mr. MacGregor: The Agriculture Council had a brief discussion on the sheep regime this week, but the question has been referred to a working party, which is currently examining the details. We have made it clear that if the regime is modified it must continue to take full account of our predominant interest and the need to restrain CAP expenditure. It must also take into account the Community's international obligations. The ceiling is one aspect of that, but the matter is complicated, because we are also concerned about the clawback, and a ceiling would help over that. Such details are being thoroughly examined.
    Sir Hector Monro: I welcome my hon. Friend's comments. Does he realise that the retention of the sheepmeat regime at the highest possible level is vital to the confidence of the hill sheep farmers, who currently deserve all the help that we can give them?
    Mr. MacGregor: I recognise the benefits that the regime has introduced. The Commission has described this as a transitional measure, but, as a major producer and consumer of sheepmeat, we see no reason why it should be transitional.
    Mr. Lord: Sheep farmers receive as much money in subsidy per kilo as pig farmers receive for their total product. Is this fair, when the two meats are in direct competition?
    Mr. MacGregor: My hon. Friend is aware of some of the difficulties created by a heavy pigmeat regime. However, the evidence suggests that there is no direct correlation between the prices and consumption of sheepmeat and other meat.

    Salmon
    Mr. Charles Morrisonasked the Minister of Agriculture, Fisheries and Food what the Government are doing to prevent further damage to Atlantic salmon stocks both within the 12-mile limit and further afield.
    Mr. MacGregor: Within 12 miles we are considering measures to reduce the numbers of salmon taken illegally, especially by organised gangs. In particular, we are examining the proposals for a salmon-tagging scheme made in the report "Salmon Conservation — A new Approach" to see whether they can be given practical application.
    We shall announce the results of this examination, and those concerning the other salmon issues set out in our consultation paper, as soon as possible.
    The intercepting fisheries beyond 12 miles now come within the scope of the recently established North Atlantic Salmon Conservation Organisation. The organisation's first meeting will take place in Edinburgh from 16 January 1984, and we shall seek to ensure that it plays an effective role in safeguarding our salmon stocks.
    Mr. Morrison: There continues to be grave concern about the effects of drift netting, both within United Kingdom waters and further afield, particularly off Greenland. I appreciate what my hon. Friend is doing and the consultations in which he is engaged, but is it not high time for more action?
    Mr. MacGregor: I am aware of my hon. Friend's interest—he has been writing to me recently about one of the drift net salmon fisheries — and of the wider concern. The issue was discussed in our consultation paper and we have received many comments, often representing conflicting viewpoints. I hope to be able to announce proposals when we have completed a thorough reappraisal of the problems.
    Mr. Mason: If salmon stocks are to be conserved, the salmon-tagging scheme should be introduced as a matter of urgency. The proposal has been before the Minister for some months. Secondly, the Minister ought to take steps to ban the use of nylon monofilament gill nets. Thirdly, he should restrict the increase in the number of licences issued to salmon netters, who are netting salmon off the coastline and in the estuaries of the salmon rivers. Why does the Minister not adopt those positive proposals?
    Mr. MacGregor: I am aware of the concern and of the need for action, and I am anxious to do something as quickly as possible. My Department has examined the problem, and I am now having discussions with my noble Friend the Minister of State, Scottish Office, who has held a series of meetings with representatives of salmon interests north of the border. I shall endeavour to reach a conclusion as soon as possible.

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    Our fisheries scientists are conducting research into the effects of using monofilament nets. So far they have found no firm evidence that the rate of escape from such nets is greater than that from other nets, or that in escaping fish sustain severe damage.
    Mr. Bill Walker: I thank my hon. Friend for the interest that he is taking in the problems arising in salmon rivers. Will he bear in mind during his discussions and in the efforts that he is making that the Scottish salmon rivers are a vital part of the Scottish economy and that when people do not fish these rivers the impact is felt in many other sectors of the Scottish economy? Will he keep that firmly in mind?
    Mr. MacGregor: I am aware of my hon. Friend's point. Indeed, I am spending part of the recess, around the new year, near a Scottish river. Therefore, I am fully aware of my hon. Friend's point, although I shall be on holiday on that occasion. I assure him that that is one of the matters that I am discussing and will continue to discuss with my noble Friend the Minister of State, Scottish Office.
    Mr. Beith: Will the Minister take care to distinguish between poaching and the properly regulated legal fishing at sea and in rivers which provides a livelihood for fishermen in areas such as Northumberland?
    Mr. MacGregor: I fully understand the hon. Gentleman's point. It is the poaching about which we are most worried.

    Paté de Fois Gras
    Mr. Phillip Oppenheimasked the Minister of Agriculture, Fisheries and Food if he will introduce controls on the importation of paté de foie gras into the United Kingdom.
    Mrs. Fenner: No. I know of no evidence to justify such controls.
    Mr. Oppenheim: Is my hon. Friend aware of the extreme cruelty involved in the production of such paté in France and eastern Europe? Is she further aware that anyone who attempted to produce it in the United Kingdom would almost certainly be prosecuted under the Cruelty to Animals Act 1876? Therefore, is there not an excellent case for a total ban of that product?
    Mrs. Fenner: I can only try to assure my hon. Friend by saying that in 1974 a special inquiry, under the auspices of the Council of Europe, was made by a group of experts into the practice in France. They concluded that although they did not find the method of production appealing, they saw no evidence of suffering or cruelty. I know of no new evidence which contradicts those findings.
    Mr. Hardy: Bearing in mind the events of recent months, during which our French neighbours have pursued their national interests with remorseless consistency, would it not now be appropriate for Britain to make a suitable gesture and perhaps suggest that if there is to be any excessive stuffing it should not be of the goose?
    Mrs. Fenner: I am sure the hon. Gentleman realises that taking such action would have no effect on production methods in other countries. Supplies would simply be diverted to other markets. We work extremely hard to promote animal welfare through international agreement.
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    I am sure that everyone who approves of the humane treatment of animals wants us to do that throughout the world.

    Food Production
    Mr. Flanneryasked the Minister of Agriculture, Fisheries and Food if British farmers are now producing a food surplus.
    Mr. Jopling: No. Although production of certain commodities exceeds home consumption, overall, the United Kingdom is three quarters self-sufficient in the production of temperate foodstuffs.
    Mr. Flannery: Is it not a fact that farmers now receive massive subsidies which are bigger than those given to British industry and that, although food production is increasing, the price of food is also increasing? Does he agree that the prairieisation of our countryside is deplorable and that, because of the massive subsidies given to farmers, hedges, ditches, trees and bushes are being destroyed and massive fields upwards of 1,000 acres now litter the countryside in many areas?
    Mr. Jopling: I must reject what the hon. Gentleman says and ask him in future, before he asks such questions, to do a little homework. He might realise that, as I said a few moments ago, over the years food prices have risen less than prices in general. With regard to the horrific word "prairieisation", I draw his attention to the fact that a few weeks ago I announced the termination of capital grants for digging up hedges in the lowlands. I also announced new Government money to assist the rebuilding of hedges and walls in upland areas. I therefore utterly reject the hon. Gentleman's allegation.
    Mr. John Townend: Does my right hon. Friend agree that the British public get far better value from the support that is given to agriculture than from the subsidies that are given to the railways and the Coal Board?
    Mr. Jopling: I could not agree more with my hon. Friend. He is absolutely on the ball.
    Mr. Geraint Howells: What plans has the Minister in mind for the time when British agriculture is overproducing food?
    Mr. Jopling: I do not see any prospect at present of British agriculture overall producing more temperate food than we can use. The hon. Gentleman will recall from last year's White Paper that we were producing 76 per cent. of temperate foodstuffs. We have a very long way to go in certain sectors of agricultural production, and I do not think that what he has in mind is a practical possibility at present.
    Mr. Robert Hughes: Is the Minister agreeing with his hon. Friend that agriculture should be open to the same monetarist philosophy as is being applied to other parts of British industry?
    Mr. Jopling: I was merely agreeing with my hon. Friend that this country gets better value from the Government subsidies that go to agriculture than it does from the assistance given to many other industries up and down the country.

    Flood Alleviation Scheme (Lincoln)
    Mr. Kenneth Carlisleasked the Minister of Agriculture, Fisheries and Food when he will give the go-ahead for the Lincoln flood alleviation scheme.
    Mrs. Fenner: A decision on the Anglian water authority's application for grant aid for the scheme can only be made following the confirmation of its proposed compulsory purchase order.
    Mr. Carlisle: Will my hon. Friend accept that in Lincoln we shall be very disappointed that the answer is not today? Does she agree that the threat of a major flood in Lincoln once every 20 years is unacceptable and will she therefore ensure that the decision on the flood alleviation scheme is made rapidly?
    Mrs. Fenner: I assure my hon. Friend that I have every wish to help to prevent flooding in Lincoln. However, I am not able in law to approve the present land drainage scheme until the compulsory purchase order has been published and confirmed.

    Sugar
    Mr. Teddy Taylorasked the Minister of Agriculture, Fisheries and Food what is the current gap between the world market price for sugar and the European Economic Community intervention price.
    Mr. MacGregor: Expressing the common intervention price for white sugar in sterling terms using the representative rate of exchange and taking the price quoted on the London terminal market for white sugar as representing the world price, the difference between the two on 14 December was £177 per tonne.
    Mr. Teddy Taylor: As this staggering gap between Common Market prices and world prices is not unrepresentative of the CAP prices generally, does my hon. Friend agree that the Institute of Fiscal Studies may have made an under-estimate in stating last week that the average cost of the agricultural policy to the average British housewife is between £7 and £8 per week?
    Mr. MacGregor: There are very wide variations in many of these calculations. That occurs because they are extremely difficult to calculate. There are many difficulties about my hon. Friend's first question. As he knows, I have had to use a number of different definitions in replying to him. One of the factors that have to be taken into account is the volatility of products on world markets as, for example, with sugar. It is very difficult to come to any single figure.
    Mr. Robert C. Brown: Is the Minister aware that the appalling price gap to which he has referred in conjunction with the minimum import price that the EEC has imposed on its dried fruit is guaranteed needlessly to make the price of our Christmas puddings and mince pies much more expensive than ever this year?
    Mr. MacGregor: I should say two things to the hon. Gentleman. First, both the Community producers and the ACP producers are guaranteed the same price for their raw sugar. This is not very different from the situation that existed before we joined the Community when United Kingdom consumers paid the weighted average of the price paid to United Kingdom producers and suppliers
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    under the Commonwealth sugar agreement. Secondly, as he will know, in price reviews we have argued consistently for restraint on Community sugar prices.

    Horticultural Products
    Mrs. Roeasked the Minister of Agriculture, Fisheries and Food what horticultural products produced in the United Kingdom are subject to a European Economic Community regime.
    Mrs. Fenner: I congratulate my hon. Friend on her appointment to the Select Committee on Agriculture and say in answer to her question that all horticultural products produced in the United Kingdom are subject to a Community regime, but the main price support measures apply to a limited range of items.
    Mrs. Roe: What steps will the British Government take to ensure that our horticulture is protected when Spain and Portugal join the Community?
    Mrs. Fenner: I am sure that United Kingdom horticulture will show its customary resilience in responding to competition from Spain and Portugal. We shall ensure that the transitional period is adequate to allow a smooth adjustment. The Government have recently demonstrated their determination to help the industry to adapt and compete effectively by providing increased incentives for energy-saving facilities in the glasshouse sector.
    Mr. John Wells: Is my hon. Friend aware that considerable European funds are available for publicity for non-edible horticultural products? What intention does she have to assist our producers by providing not necessarily Government funds but a Government gesture of goodwill towards Food from Britain in its efforts to publicise non-edible products?
    Mrs. Fenner: One of the priorities of Food from Britain is assistance in respect of pot plants. I assure my hon. Friend that we shall be studying carefully, in consultation with the industry, the Commission's forthcoming report on the non-edible sector and any proposals that may be made on the regime for cut flowers.

    Dairy Farmers
    Mr. Colvinasked the Minister of Agriculture, Fisheries and Food how many dairy farmers have gone out of milk production as a result of the non-marketing and conversion scheme since it came into operation.
    Mr. MacGregor: The final report by the Commission on the non-marketing and conversion premium schemes indicates that nearly 123,000 applications were approved under these schemes in the period July 1977 to December 1981. In addition, a small number of applications were approved after 1981. In the United Kingdom there were some 8,300 successful applications under the scheme.
    Mr. Colvin: Will my hon. Friend say how many of those farmers, having taken substantial compensation, are now back in dairying? Would it not have been a great deal better if the five-year limit had been a 10-year limit? Has the European Commission made any more acceptable proposals for limiting milk production, proposals which would stand a better chance of working and would be fair to British dairy farmers, who are the most efficient in the world?
    Mr. MacGregor: I regret that no statistics are available about those who have come back in, as the scheme required producers only to give up milk production for a maximum period of five years. It is probable that a number have come back in, and that is one of the many criticisms that could be made of the scheme, which I do not think was cost-effective. The Commission has not come forward with proposals, but in view of our criticisms of the operation of the scheme we should look critically at any such proposals.
    Mr. Robert Hughes: Will the Minister discover how many farmers have come back into dairying, as I understand that it is an accelerating process?
    Mr. MacGregor: I shall certainly look into that. Because we do not have the information, we should have to send out further surveys. I shall have to look into that aspect. In view of what I said—that the scheme no longer exists and that we should be critical of any scheme in anything like that form—I hope that it becomes an academic question.

    Fishing Quotas
    Sir Michael Shawasked the Minister of Agriculture, Fisheries and Food what progress has been made in the Council of Fisheries Ministers towards agreement for total overall catch in 1984.
    Mr. Jopling: I shall answer this question at the end of Question Time.

    Marginal Land
    Mr. Spenceasked the Minister of Agriculture, Fisheries and Food when he now expects to get agreement in the Council of Ministers to extend the Community's less favoured areas directive to United Kingdom marginal land.
    Mrs. Fenner: I congratulate my hon. Friend the Member for Ryedale (Mr. Spence) on his appointment to the Select Committee on Agriculture and assure him that we are continuing to press the Council of Ministers to approve the United Kingdom's case for designation of certain marginal areas as less favoured. I regret, however, that I cannot predict when we shall achieve this outcome.
    Mr. Spence: I thank my hon. Friend for her congratulations on my appointment to the Committee. Will she bear in mind that we have been waiting for action in this matter since 1979, when the Government report on hill areas was produced — the Select Committee on Agriculture also reported on the uplands—and in the meantime conditions in the hills have worsened? Will she use her best endeavours to see that progress is made as quickly as possible?
    Mrs. Fenner: I am aware that it has taken a while for the report to be implemented, but designation is not a simple formality. Extensive data were required on a wide range of economic and social factors, and the Commission needed time to consider them. There is concern, not about the technical merits of our case, but about the general question of extending the less favoured areas at a time when the whole structural policy is under review.
    Mr. Skinner: If the Government's policy and intention are to look after and exploit all the marginal land to reduce
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    the amount of food imports, why does the Minister of Agriculture, Fisheries and Food not pass a message to the rest of the Cabinet that what is good for marginal land should be good for marginal pits?
    Mrs. Fenner: I made this point when I was last asked that question. I do not have at the tip of my tongue the figures for the losses of marginal pits, but the position of marginal land is certainly not the same.
    Mr. McQuarrie: When my hon. Friend addresses the issue of marginal land, will she remember that the rural areas of Scotland are as less favoured as those in the highlands and upland areas? Will she consider those areas when discussing allotting the status of less favoured areas?
    Mrs. Fenner: The marginal lands which are being considered as additional to the less favoured areas have been drawn out, and the exact sites have been made public. Those are the areas to which the discussion in Europe is directed.
    Mr. Geraint Howells: Does the Minister agree that this directive will not be implemented for at last least five years, if ever?
    Mrs. Fenner: We are doing our best to have the directive implemented sooner than that.

    Milk
    Mr. Leighasked the Minister of Agriculture, Fisheries and Food what has been the level of ultra heat treated and sterilized milk imports since the regulations on these products were tabled.
    Mr. Jopling: I am aware of only two consignments, both of UHT milk. A consignment which arrived at Portsmouth in September has been re-exported.
    Mr. Leigh: I congratulate my right hon. Friend on drafting those regulations in such a tough way that our dairy industry has obviously been protected until now. As we have obeyed the letter of Community law, does he agree that in spite of all the huff and puff of Opposition Members, it was they who sold the pass in 1977 by allowing in pasteurised frozen cream?
    Mr. Jopling: I hate to argue in view of my hon. Friend's warm words, but the fact is that the regulations were drafted to protect not the dairy industry but public health. My hon. Friend is right in saying that in the 1970s the Labour Government first allowed pasteurised cream to come into this country.

    Dairy Products
    Mr. Watsonasked the Minister of Agriculture, Fisheries and Food whether the United Kingdom is currently self-sufficient in dairy products.
    Mr. MacGregor: We have for many years produced sufficient milk to supply the whole of our liquid market. Estimates prepared by the Milk Marketing Board indicate that in 1982 in respect of milk and milk products the United Kingdom was 91 per cent. self-sufficient in butterfat and 131 per cent. self-sufficient in solids-not-fat. Estimates for the level of self-sufficiency in future years are not available, but the trend has been for our self-sufficiency to increase.
    Mr. Watson: I am grateful to my hon. Friend for confirming that Britain is not yet entirely self-sufficient in

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    dairy products. Will he confirm that this year the incomes of dairy farmers have fallen by 41 per cent. in real terms from last year and that in those circumstances any EEC proposal that would seek to demand yet further sacrifices from British dairy farmers could only be regarded as highly unfair, to say the least?
    Mr. MacGregor: I can confirm that farm incomes are likely to be down this year, although I cannot confirm the figure, partly because of seasonal factors. The costs of disposing of the surplus of dairy products throughout the Community are large, and we have quite a supply of those surpluses. We must face that problem. It would be unrealistic to seek exemptions for the United Kingdom, because that would encourage a host of other requests for special treatment and we would not come out better from that exchange.

    Sites of Special Scientific Interest
    Mr. Hardyasked the Minister of Agriculture, Fisheries and Food if he will take steps to prevent farming and forestry interests from purchasing land within sites of special scientific interest in order to propose and to carry out operations which enable them to claim compensation from public funds.
    Mrs. Fenner: It is not the Government's general policy to inhibit the right of individuals or companies to buy land.
    Mr. Hardy: Does the Minister agree that there are grounds for suspecting that projects will be supported by the business expansion scheme seeking funds from the Treasury in a manner of which society could not possibly approve? Does she agree that that approach seems to be based on the experience of Graig Meagaidh in Scotland, which, although outside the Minister's jurisdiction, reveals an unacceptable state of affairs?
    Mrs. Fenner: I cannot comment on the latter point, but the Government regard the business expansion scheme as a useful means of encouraging investment in small businesses. It is not primarily aimed at agriculture, but agricultural ventures are welcome. Land of conservation interest is covered by exactly the same safeguards under countryside legislation as any other land not so involved.

  PRIME MINISTER

    Civil Defence
    Ql. Mr. Neil Thorneasked the Prime Minister if Her Majesty's Government will seek to endow a chair of civil defence at a British university.
    The Prime Minister (Mrs. Margaret Thatcher): We have no plans to do so.
    Mr. Thorne: In view of increasing public concern in recent months about civil defence, will my right hon. Friend re-examine this matter? Does she agree that emergency planning officers have a difficult job to do, often in the face of bitter local opposition, and must have a policy to which to work? Does she agree that an independent review, through a university chair, seems one of the best ways to achieve that?
    The Prime Minister: I know that my hon. Friend has taken a great interest in civil defence matters, and I have read his excellent speech in the debate in March last year.
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    As he knows, the Government have substantially increased the amount spent on civil defence. The figure is now about £69 million, which seems about right. A great deal of research takes place in the Home Office, but if my hon. Friend has further evidence to lay before us we shall, of course, reconsider the matter.
    Mr. Dubs: Will the Prime Minister publish the list prepared in 1980 by the scientific advisory branch of the Home Office showing which areas of the country would be threatened in the event of a nuclear attack? Does she agree that the people of London, Hertfordshire, the West Midlands, Merseyside, Tyneside and Strathclyde have the right to know the level of destruction that they would have to face if such an attack took place?
    The Prime Minister: The answer is no, Sir. It seems to me, however, that the hon. Gentleman's question gives great support for having proper civil defence all over.

    Engagements
    Mr. Tim Smithasked the Prime Minister if she will list her official engagements for Thursday 15 December.
    The Prime Minister: This morning I presided at a meeting of the Cabinet and had meetings with ministerial colleagues and others. In addition to my duties in the House I shall be having further meetings later today.
    Mr. Smith: Has my right hon. Friend noticed the contrast between the responsible line taken by Mr. Len Murray and a majority of the TUC general council on actions in breach of the law and the blanket statement of support for the NGA issued by the campaign group of Labour Members, one of whom is the hon. Member for Oldham, West (Mr. Meacher), who is a member of the Shadow Cabinet, and what conclusions does she draw from that?
    The Prime Minister: Like my hon. Friend, I welcome the courageous action of the TUC general secretary and those who supported him. I hope that the Leader of the Opposition will unequivocally support the decision of the general council of the TUC.
    Mr. Kinnock: In view of the provocative and prejudiced action of the European Parliament this morning, will the Prime Minister now withhold the £547 million from our contributions in lieu of the rebate that rightfully belongs to the British people?
    The Prime Minister: Like the right hon. Gentleman, I was greatly disappointed by the vote in the European Parliament this morning. So far, the Community is not in default with Britain. The right hon. Gentleman may recall that at this time last year the European Parliament rejected a budget containing United Kingdom refunds, but the refunds were nevertheless paid by the end of March.
    Mr. Kinnock: All that means is that we are 12 months nearer a crisis without resolving it. The condemnation and disappointment of the Prime Minister is nothing more than huffing and puffing. Does she not realise that lack of decisive action now will simply be read as further equivocation by her on this issue? Why is she so resolved to be irresolute? Why is she so wet about rebates? Will she take the lead on behalf of the British people and insist upon fundamental reform of the common agricultural policy so

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    that we are no longer ruled by the convenience of others, not just next March or next autumn but at any time in the future?
    The Prime Minister: The right hon. Gentleman repeatedly shows that I cannot rival him in huffing and puffing. At this time last year the European Assembly passed a similar resolution. Nevertheless, we got our full refunds on time. Therefore, we may on this occasion get our full refunds on time. If not, we shall have to take action to safeguard our position. I hope that that will not be necessary, but if it were we should have to take it.
    Mr. Hill: Is my right hon. Friend aware that the Cunarder QE2, after its major refit in Germany, is suffering engine difficulties in Southampton Water? Does that not reflect on the work carried out in Germany? Is that not a reason for re-emphasising the quality of British ship repairs carried out in Southampton?
    The Prime Minister: From what I have seen of the detailed report, it is difficult to allocate the blame between countries, and it would be very unwise to do so, except to express the view that all work everywhere should be well done.
    Mr. Dormandasked the Prime Minister if she will list her official engagements for 15 December.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Dormand: Is the Prime Minister aware of the massive campaign against pit closures being launched in my constituency tomorrow by the local authorities, the trade unions, the Labour party, and many other organisations which have no direct interest in the coal industry? When will the Prime Minister realise that the closure of a pit means the deliberate destruction of a whole community? In my part of the country, that leaves no alternative employment. If the right hon. Lady recites how much money the industry receives from the Government, why do the coal industries of countries in the EEC get much more?
    The Prime Minister: Under the "Plan for Coal", which was published when the Labour party was in office, the scheme was for investment in good pits to produce at competitive prices good coal, for which there is a great future. There were also agreements for the closure of pits and for increased productivity. The programme for the closure of pits is behind schedule and the investment programme is well up to schedule and has been fully honoured. We hope that productivity will eventually reach the target. Coal has a great future in this country. We want competitive coal and to sell it at a reasonable price with productivity which does not require the enormous subsidies which are at present given to the industry.
    Sir Hugh Fraser: Will my right hon. Friend, as a gesture to the British public at this time of goodwill, suggest to other Heads of State and the Prime Ministers that, in view of the problems of the EEC, next year's elections should be postponed until it is quite clear on what we are voting?
    The Prime Minister: I think that such a proposal would be far from welcome. I am not sure that to postpone the election to the European Assembly would be welcomed in the House. I think that it would be far better if it went ahead on time. I hope that Heads of Governments
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    and States during their meetings before the election will make strenuous efforts to solve the problems which we did not solve at Athens.
    Mr. Dixon: Does the right hon. Lady recall that in a speech at a Conservative rally in Swansea just over three years ago, when unemployment was 1·5 million, she advised the unemployed to be mobile? What is her advice now that unemployment has gone up to 4 million? What would she say to my constituents who took her advice then, moved away from Jarrow and are now unemployed hundreds of miles away from their families and friends?
    The Prime Minister: Since then, Swansea has become one of the successful enterprise zones which is meant to draw more jobs into that area. The hon. Gentleman will know that South Wales——
    Mr. Dixon: South Wales? I am from Jarrow.
    The Prime Minister: —has been successful in attracting substantial inward investment into this country because we are a member of the European Community.
    Among the efforts to reduce unemployment overall, the Government have introduced substantial training schemes, provided grants to help small businesses and done everything possible to encourage the creation of wealth through efficient industries that can produce goods of the right design and price, of the sort that the hon. Gentleman's constituents will buy in preference to those from overseas.
    Mr. Bruceasked the Prime Minister if she will list her official engagements for Thursday 15 December.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Bruce: Was it with the right hon. Lady's approval that early this morning two Government Whips went into the Lobby to persuade Conservative Members not to vote for the recommendation on the Committee of Selection? Is she satisfied that parties that represent nearly 8 million votes should not be represented on the Select Committees for Defence and Welsh Affairs and that the Social Democratic party has no representation on any Departmental Select Committee?
    The Prime Minister: Whatever my right hon. Friend did, I am absolutely sure that it was absolutely right.
    Mr. Cockeram: Does my right hon. Friend recall that those who in the past have fought for personal freedom and opposed repression have been honoured accordingly? Will she therefore seek to give credit where credit is due and, in particular, note that the majority of the nation does not find acceptable the ennoblement of trade union leaders who have opposed personal freedom?
    The Prime Minister: As my hon Friend will know, many people will stand up for personal freedom and the upholding of the law. It would be as well if we in the House did not go into questions relating to honours.
    Dr. Owen: Is the Prime Minister aware that some of us are surprised that she has not informed herself about what happened in the early hours of the morning.
    Mr. Skinner: The right hon. Gentleman missed the vote.—[Interruption]
    Mr. Speaker: Order. I cannot even hear what the hon. Member for Bolsover (Mr. Skinner) is saying.
    Dr. Owen: You may, Mr. Speaker, not be aware of the fact that the hon. Member for Bolsover (Mr. Skinner) suffers from a disease from which there is no cure—verbal diarrhoea.
    Mr. Skinner: Will the right hon. Gentleman give way?
    Mr. Speaker: Order. The hon. Member for Bolsover needs no encouragement.
    Dr. Owen: Last night the Patronage Secretary and another Whip went into the No Lobby to take out——
    Mr. Sedgemore: Ask a question.
    Dr. Owen: I am informing the Prime Minister, since she seems to be unaware of what the Patronage Secretary was doing. It was a gross abuse of the House—[HON. MEMBERS: "Sit down."] I shall stay on my feet until I am heard. Is the Prime Minister aware that she has the responsibility to inform herself about what the Patronage Secretary was doing in the House and that it is an abuse of the power—[Interruption.]
    Mr. Speaker: Order. We have a very busy day ahead of us. Will the right hon. Gentleman please come to a conclusion?
    Dr. Owen: I shall stay on my feet until I am heard, Mr. Speaker.
    Hon. Members: Sit down.
    Mr. Speaker: Order. I am sure the House wishes to hear what the right hon. Gentleman has to say.
    Hon. Members: No.
    Dr. Owen: There was a gross abuse of the House last night, of which the Prime Minister seems to be unaware. She comes to the House and jokes—[HON. MEMBERS: "Ask a question."] I am asking the Prime Minister whether she is not aware of the abuse. She is the repository of a so-called landslide majority—[Interruption.] Twenty-six and a half per cent.—[Interruption.]
    Mr. Speaker: Order. Has the right hon. Gentleman finished?
    Mr. Home Robertson: Tell the right hon. Gentleman that he has finished.
    Dr. Owen rose——
    Mr. Speaker: Order. We may be getting very close to Christmas, but we must get through questions to the Prime Minister. Will the right hon. Gentleman bring his question to a conclusion?
    Dr. Owen: I shall bring my question to a close when I am heard in the House, Mr. Speaker. The Prime Minister was asked a direct question by my hon. Friend the Member for Gordon (Mr. Bruce). She sought to make a joke of a serious question. [HON. MEMBERS: "Sit down".] We are determined to be heard in the House and I shall remain on my feet until I am heard. In view of the conduct of the Patronage Secretary last night, will the Prime Minister bring a motion to the House to enlarge the Select Committee on Defence to allow proper representation of the views of 26 per cent. of the people?
    The Prime Minister: This is a matter for the Leader of the House who, I understand, opened the debate with his usual silver-tongued eloquence. I am not sure whether the right hon. Member for Plymouth, Devonport (Dr. Owen), who has just complained, was present to hear my right hon. Friend's speech. I am sure that had he been here he would have found it very persuasive.
    Later—
    Mr. Bill Walker: On a point of order, Mr. Speaker. I call the attention of the House to question No. 9 to the Minister for Agriculture, Fisheries and Food. Apparently according to the Order Paper, my hon. Friend the Member for Southend, East (Mr. Taylor) has been restored. to Scotland. We appreciate this very much because we miss him, but perhaps the mistake should be rectified.
    Mr. Speaker: That is a fair point. I missed it myself. Clearly, it is a misprint.

Fisheries Council
The following Question stood upon the Order Paper:
Sir Michael Shawasked the Minister of Agriculture, Fisheries and Food what progress has been made in the Council of Fisheries Ministers towards agreement for total overall catch in 1984.
3.34 pm
The Minister of Agriculture, Fisheries and Food (Mr. Michael Jopling): I am pleased to report that the Council of Fisheries Ministers reached agreement on a series of important decisions which resolve the main outstanding problems affecting the common fisheries policy and started discussion of the total allowable catches and quotas for 1984—[Interruption.]
Mr. Mark Hughes: On a point of order, Mr. Speaker. May we wait a few minutes so that we can hear the Minister better?
Mr. Speaker: Order. Would right hon. and hon. Gentlemen withdraw as speedily and as quietly as possible?
Mr. Jopling: I have been asked to start again.
I am pleased to report that the Council of Fisheries Ministers reached agreement on a series of important decisions which resolve the main outstanding problems affecting the common fisheries policy and started discussion of the total allowable catches and quotas for 1984.
First, the Council at last agreed on the percentage allocations of North sea herring, a matter which has been the subject of long and difficult negotiations at no fewer than six Council meetings since June. The settlement reached was very satisfactory from the United Kingdom point of view: at a total availability of 155,000 tonnes, which is about the level expected in 1984, the United Kingdom will obtain 24·15 per cent. of the total, after allocating the fixed quantity of 7,100 tonnes to Belgium; while at a level of 251,000 tonnes we will obtain 23 per cent., after allocating 6,000 tonnes to Belgium. These shares are well in excess of the United Kingdom's share of the historic catches which averaged only about 16 per cent. between 1960 and 1976. Throughout the negotiations on this difficult subject I have stayed in close touch with representatives of the industry and I am grateful for the strong and sensible support which they have given me. I am happy to say that they welcomed the settlement reached.
At my request the commission is approaching the Norwegians today to seek to establish arrangements which will permit fishing for herring in the North sea to commence as early as possible in 1984.
The Council also endorsed the agreement between the Community and Norway on total allowable catches and shares of the joint stocks other than herring and on reciprocal fishing rights. There is some concern about the level of the total allowable catches for North sea white fish stocks. We had previously managed to obtain larger transfers of cod from the Norwegians, but, again at my request, the Commission has undertaken urgently to discuss with the Norwegians increased availability of North sea cod.
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The Council went on to agree on total allowable catches and quotas for 1983, including a number of improvements which we securred in the negotiations on stocks of interest to our fishermen.
There was a preliminary discussion of the Commission's proposals for total allowable catches and quotas for 1984 in which I raised a number of points of concern to the United Kingdom. The Council will resume discussion of these proposals at its next meeting in January. For the month of January the Council agreed that fishing should continue on the basis of a rollover of the 1983 quotas as modified by the agreement with Norway.
Lastly, the Community's agreement with Canada was approved by the Council. This provides for some fishing opportunities for the United Kingdom in Canadian waters and for fair and effective trade arrangements which adequately protect our catches and processors.
This was a very important meeting on fisheries. The last piece of the common fisheries policy jigsaw is now in place and we are already into discussions of the 1984 total allowable catches. There is now every prospect of developing its effectiveness and providing a secure and stable basis for the fishing industry in future.
Sir Michael Shaw: Is my right hon. Friend aware that he deserves the congratulations not only of the whole House but of the whole of the British fishing industry on the hard and constructive work that he has carried out on their behalf? Is he further aware that by his hard work he has shown that agreement can be reached so as to bring about a fair and constructive future for the fishing industry? Will he give an assurance that, having got thus far, he will continue to spare no effort to ensure that the agreement on the 1984 quotas and the implementation of the agreement that has been won will be carried through?
Mr. Jopling: I am extremely grateful to my hon. Friend for his most generous words. I can give him an undertaking that we shall begin as soon as possible to continue the work which was started yesterday.
With regard to the 1984 quotas, one helpful thing is that we have already discussed them within a few days of the Commission, publishing them. I shall seek to get them put into effect as soon as possible.
Mr. Austin Mitchell: The Minister will be aware of the concern that his ominous words on North sea white fish will cause in the industry. Is he aware of the dependence of the Grimsby fishing industry on North sea cod? Is he further aware of the disastrous effect that any reduction in North sea cod catches would have on the Grimsby fishing industry, which has already been hard hit? Will he undertake to ensure that there will be no reduction in our North sea cod catches? Failing that, what steps is he preparing for compensation, financial or otherwise, for the industry, which will suffer badly if those catches are reduced?
Mr. Jopling: I am well aware of the problems which still arise regarding North sea cod stocks. The scientists' original proposal for that stock which was produced some weeks ago, was 182,000 tonnes. I put immediate pressure on the Commission to do whatever was possible to persuade the scientists to increase their estimates and to arrange transfers with Norway. As a consequence, the figure has been increased to 215,000 tonnes, but I am still

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not satisfied, which is why, at my request yesterday, the Commission today began further discussions with Norway to increase the figure.
Sir Patrick Wall: I add my congratulations to the Minister on achieving at last a sensible common fisheries policy. Will he use his influence on the EC to initiate swap deals with other countries, which could save what remains of the deep-water fleet?
Mr. Jopling: I am grateful to my hon. Friend for his kind words. I am conscious of the difficulties and of the great reductions which have occurred in the deep-water fleet, especially in Hull, in which my hon. Friend takes a close interest, and the Commission shall do what it can. I have already referred to the Canadian arrangements, and yesterday we discussed the position of west Greenland, in which we have an interest. I shall pursue all those opportunities when I can.
Mr. Donald Stewart: Were any agreements made or did any discussions take place at the meeting to ensure that under the policy in future there will not be gross overfishing? The Danes did that in recent years, and the German Government gave approval to their trawlers to fish for herring when there was a ban on it in the North sea.
Mr. Jopling: The right hon. Gentleman has put his finger on an important matter. Our conservation measures are already in operation and we are increasing Community supervision of the inspectorate of fisheries. Therefore, we are bearing in mind the problems of overfishing. I hope that in future we shall see less overfishing than in the past.
Mr. Albert McQuarrie: I congratulate the Minister on his victory at the Council of Ministers; it was well received by the Scottish fishermen's organisations, which have been trying desperately to achieve one. My right hon. Friend achieved excellent success on herring, and he is right to say that we now have the highest TAC figure that we have had since the 1960s, except for 1964. When my right hon. Friend attends the discussions on 31 January about the six other species, will he endeavour to agree the total quotas on an annual basis rather than in spasmodic deals, such as have taken place in the past? That way fishermen will know how much they can catch during a year.
Mr. Jopling: I am grateful for my hon. Friend's kind words. I agree with him that it is important to give fishermen as much warning as possible. Yesterday they asked me to do my utmost to open the herring fishery talks as soon as possible after 1 January and not to wait until the middle of the year. Therefore, I am glad that the Commission is starting talks immediately with that in mind.
In the 1960s, when the total herring catch was about 150,000 tonnes, the United Kingdom's share was about 18 per cent. We have negotiated 23 per cent. for the future, which is very satisfactory.
Mr. William Ross: I understood the Minister to say that he had asked scientists to upgrade the estimate of the TAC in cod. Why does he employ scientists, if he will not accept their advice?
Mr. Jopling: As a farmer, the hon. Gentleman will know that science is not always precise when one is talking about natural sciences. We have often asked scientists to
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reconsider their estimates and to agree to increase their original figures, and I am glad that on this occasion they did so.
Mr. John Townend: May I add my thanks to my right hon. Friend for the efforts that he is making with regard to North sea cod, which is so desperately important to Bridlington? He will no doubt be aware that, as a result of opening up the North sea to herring fishing, the area between six and 12 miles off the coast of Bridlington will be open to French herring fishermen for the first time in living memory. What efforts will the Government make to ensure that the French fish only for herring, not for other species, and do not damage the fixed gear of British fishing boats?
Mr. Jopling: I am grateful for my hon. Friend's kind words. The best thing to do is to see how we get on, and if we find any evidence of abuses of the rules in the area close to my hon. Friend's constituency, I hope that he and I will discuss it and I will take appropriate action.
Mr. James Wallace: If I heard the Minister correctly, he said that, although agreements had been reached between the Community and Norway, those agreements were for all species except herring. Will he assure the House that in 1984 we shall not he in a position similar to that of 1983, when Norwegian herring boats were allowed to continue to fish in the North sea while the British fleet was kept inshore? Has there been a subdivision of the quotas in areas IV a, IV b and IV c of the International Council for the Exploration of the Sea?
Mr. Jopling: The hon. Gentleman may recall that the reason why we had difficulty with Norwegian herring fishing in 1983 was that we had not agreed on other stocks. As we now have an agreement on other stocks, I ant much more hopeful that the difficulty will not recur.
Sir Walter Clegg: May I wish my right hon. Friend well in settling the 1984 quotas? Does he believe that we have sufficient capacity to take advantage of the herring quota?
Mr. Jopling: It is interesting that my hon. Friend should say that, because I told the fishermen yesterday that, having negotiated those generous quantities of herring out of the North sea, they had jolly well better catch them.
Mr. Dennis Skinner: If, as the Minister says, and as his Tory friends agreed, this is a great victory for Britain, by how much will fish be cheaper in the shops?
Mr. Jopling: With the publicity being given by the hon. Gentleman to the quality of British fish, I hope that our fishermen will be able to catch more. Many boats are now being built, which I hope means that Britain will fish right up to its quotas. If there is plenty of fish in the shops——
Mr. Skinner: Answer.
Mr. Jopling: —I hope that that will have a satisfactory effect on prices.
Mr. John Spence: Is my right hon. Friend aware that the policing of the agreement causes considerable concern? Is he satisfied that we have sufficient resources adequately to police the agreement? Does he agree that policing and conservation are vital to the inshore fishermen of the east coast?
Mr. Jopling: I agree with my hon. Friend about the importance of policing and conservation. I have already said that conservation measures are now in effect, and I hope that they will have a satisfactory influence on stocks in the years ahead. The inspectorate of inspectors is beginning to start work, and all 13 inspectors employed by the Commission will soon be in post. I am a little disappointed by the progress in providing logbooks to all fishing boats, but I hope that it will happen as soon as possible.
Mr. David Crouch: Is my right hon. Friend aware that Whitstable in my constituency has a relatively large inshore fishing fleet? Does the agreement on the total catch cover the disputes that have arisen in the past among Belgian, French and British inshore fishermen in the Channel regarding poaching with beam trawlers, and can he give an assurance to the fishermen of my constituency?
Mr. Jopling: We have examined the problems of beam trawling. In discussing the 1984 quotas and catches yesterday, I drew the Council's special attention to some of the stocks and TACs proposed for the English channel, and suggested that they should be reconsidered, because I believe that the quotas were too low in the light of scientific evidence.
Mr. Robert Hughes: The Minister will no doubt be aware that there will be some relief that the seventh attempt to break the deadlock on herring has finally ended in agreement, even though the figures agreed yesterday seem to be precisely the same as those that were on the table in October this year. Will the Minister acknowledge that even the share of 24·15 per cent. that he quoted, is well below the demands of the industry for 34 per cent. of the herring catch? Will he also acknowledge that it was the wise management and political decisions of the previous Labour Government that made sure that there was any herring left for a share to be agreed on?
On white fish, does the Minister understand that some of us find it hard to swallow that this "magnificant victory", a fortnight before the end of the year, was on the 1983 total allowable catches? That is hardly a magnificant victory, especially as the issue will be reopened again on 31 January next year, when we again begin the rounds of deciding the 1984 catches. Will not the proposition that will be discussed then be that our North sea cod share will be cut by 18 per cent., and that our North sea haddock share will be cut by 7 per cent? Far from the industry being very satisfied and pleased with the agreements, it is arguing that the cost to the fleet, if these proposals go through, will be £18 million.
We went through the whole of 1983 with stopgap solutions from one Fisheries Council meeting to another and we shall go through the whole of 1984 on the same basis of stopgap solutions, because that is what happened yesterday with white fish.
This is not good enough, and once the fishing industry realises what is happening to it, the fine words of congratulation from the Minister's hon. Friends will turn into salt in their mouths—[HON. MEMBERS: "Absolute nonsense."]—and they will regret them.
Mr. Jopling: The hon. Gentleman has asked a number of questions, which I shall try to answer. He said that the figures agreed yesterday for the North sea herring were the same as those that were on the table a few weeks ago. That is not strictly true. There are important changes in the figures, and it is on the basis on those small but vital changes that we got our deal.
The hon. Gentleman referred to the progress that his party made when it was in power. If we had continued to have the same success in settling the common fisheries policy that his party had when it was in power and trying to settle the common fisheries policy, we should still be floundering about.
Let me put the hon. Gentleman right by making an important distinction in another matter. He said that the industry was looking for a higher figure than the one at which we have settled. There is a crucial difference, in that those higher figures were on the basis of a lower total allowable catch of about 87,000 tonnes, when we are now talking about 150,000 tonnes, where the Hague preference does not operate. That is why the hon. Gentleman is wrong.
The hon. Gentleman is utterly wrong on another point. He said that the agreement that we made on herring yesterday will mean that we have to start all over again shortly.
Mr. Hughes: I said white fish.
Mr. Jopling: The hon. Gentleman should understand that the agreement that we made yesterday on herring will have staying power for the years ahead and there will be no renegotiation of the keys that we arranged yesterday.
As to white fish, I understand the difficulties, but there is no escaping the fact that, because of overfishing of cod, the amount that we can catch will have to come down from the level of the past few years. If we continue at the same level as before, we shall ruin the stock. Is that what the hon. Gentleman wants? He knows enough about fishing to know that that would be a fatal and foolish thing to do.
Mr. Hughes rose——
Mr. Speaker: Order. I am sorry, but this is an extension of Question Time and we have had a good run on it.
Mr. Hughes: On a point of order, Mr. Speaker.
Mr. Speaker: Order. We still have two points of order, business questions, and a guillotined debate.
Mr. Hughes: On a point of order, Mr. Speaker. It is not right for the Minister to put words into my mouth about herring that I did not say. I was referring to white fish being up for renegotiation.
Mr. Jopling: I am sorry if I have put wrong words into the hon. Gentleman's mouth, but I was firmly of the view that he was talking about the herring agreement that we reached yesterday.
Mr. Speaker: I have received notice of two points of order, which I propose to take now.

Glue Sniffing (Ministerial Statements)
3.55 pm
Mr. Greville Janner: On a point of order, Mr. Speaker. I seek your guidance on a matter which is of great concern to all right hon. and hon. Members, and which cannot wait until after business questions.
My point of order arises out of two answers that were given at Question Time on Tuesday, one by the Minister for Health, and the other by the Prime Minister. In reply to a question that I asked about the appropriate penalty, under new legislation in the United Kingdom, such as was imposed on the Scottish brothers for pushing glue solvents, to ensure that such people could be dealt with, the Minister for Health replied:
"My hon. Friend the Under-Secretary of State for Health and Social Security has been studying closely the problem of glue sniffing and hopes to make a statement in due course."—[Official Report, 13 December 1983; Vol. 50, c. 826.]
Later the same day, the Prime Minister gave a further assurance to the House and said:
"The Government will be making a statement later on glue sniffing. We are watching the Scottish case carefully. —[Official Report, 13 December 1983; Vol. 50, c. 840.]
Today, written answers Nos. 159 and 160 refer to glue sniffing, and I am given to understand that they were to be answered at 3.30 pm; so, instead of a statement to the House, there would be written answers.
Worse than that—on a matter about which all right hon. and hon. Members are concerned, a matter which is of deep concern to all of us who face this problem in our constituencies and who are not prepared to be fobbed off by voluntary codes — instead of a statement to the House, as promised, a press statement has been issued saying that the hon. Member for Oxford, West and Abingdon (Mr. Patten), the Under-Secretary of State for Social Security, and the hon. Member for Putney (Mr. Mellor), the Under-Secretary of State for the Home Department, will be holding a press conference at 3.30 pm in the House. Instead of coming to the Chamber to answer questions put by hon. Members on both sides, they are going to Committee Room 6 of the House of Commons to meet the press where—and I quote—
"they will be announcing details of Government measures which are going to be taken to tackle the problem of solvent abuse, which is generally known as glue sniffing."
I suggest that that is an abuse of the House. I am sure that neither the Prime Minister nor the Minister for Health sought to mislead the House. I am sure that they would not want to act in a way that was contrary to the spirit of the House, but certainly this is one of the most potent snubs to the House that we have had on a matter which is not a party matter but one which concerns us all and about which there are hundreds of names on early-day motions to show that concern.
I ask two things. I want an assurance that, in the period between 3.30 and now, no Minister has gone up to the press to give this information, because I gave notice to the Department of my intention to raise this matter. I also ask whether, as the Minister for Health is on the Front Bench, he might now give a statement to the House here, and not to the press in a Committee Room of the House.
The Minister for Health (Mr. Kenneth Clarke): Further to that point of order, Mr. Speaker. It is indeed true that my hon. Friend the Under-Secretary of State for Social
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Security today answered a written question from my hon. Friend the Member for Mid-Kent (Mr. Rowe) about glue sniffing. That was the intended statement of policy that my right hon. Friend the Prime Minister and I had in mind. I am sorry if the use of the word "statement" misled the hon. and learned Member for Leicester, West (Mr. Janner) into believing that it meant an oral statement, but I believe that one can find plenty of precedents for the repeated use of the word "statement" to mean written or oral statements to the House.
I assure the hon. and learned Member and the House that the answer to that question, which became available at 3.30, was the first public announcement of the Government's policy. The hon. and learned Gentleman is clutching an announcement of an intended press conference, at which further details will be given. By now, it has probably started——
Mr. Janner: Oh.
Mr. Clarke: —but it started after the question had been answered and became available. With respect, it is no good the hon. and learned Gentleman working himself into a great lather about a frequently followed practice. The policy was first stated to the House in the written answer. Now, subsequent to that answer, it is being explained to the press. I do not believe that anyone has been misled. However important the subject may be—and I share the hon. and learned Gentleman's concern—I do not believe that it would justify an oral statement in the middle of a crowded day's business, before a debate subject to a guillotine.
Mr. Robert C. Brown: Further to the point of order, Mr. Speaker. I do not think that the Minister or the Government realise the seriousness of this matter. The Government are treating the House in a cavalier fashion. A majority of 144 does not give them a God-given right to ride roughshod over the views of elected Members of Parliament. They must realise the extent of feeling in the House and throughout the country among the electorate. We are not prepared to be fobbed off with a pussy-footing regulation without the force of law that will merely appeal to people to stop this miserable business of drug-pushing. The pushing of solvents amounts to drug-pushing. The House deserves at least a verbal statement on this issue.
Mr. Peter Shore: Further to that point of order, Mr. Speaker. There has been a serious abuse of the House. When a major statement is made on a matter of great controversy and the statement is made to the press, Members of Parliament are deprived of the possibility of asking questions and the Minister is unable to fulfil his function of being responsible to the House. To make such a statement to the press at the very moment when the House is sitting—no statement was promised—and for the Minister to fail to apologise for this appalling conduct is to add to the natural fury that exists. We should have from the Minister for Health a strong apology for what he has done and an absolute guarantee that this sort of behaviour will not be repeated.
Mr. Kenneth Clarke: The statement of Government policy was made available to the House before it was made available to the press. As every hon. Member knows perfectly well, statements of Government policy fall into two categories. First, there are those statements which are

1171
judged by the usual channels and by my right hon. Friend the Leader of the House to be serious enough to merit an oral statement.
Mr. A. J. Beith: This is not serious?
Mr. Clarke: The second category consists of statements which, however important, are usually announced by way of written answer to a parliamentary question. The Government's policy on glue-sniffing has fallen into the second category.—[HON. MEMBERS: "So it is not serious."] No advance, embargoed copies of the statement have been given to the press. Had we made an oral statement and followed the usual practice adopted by previous Governments, the press would have been clutching embargoed copies of some of the documents before the oral statement was made in the House. A written answer was given to my hon. Friend the Member for Mid-Kent (Mr. Rowe) and copies have been available since 3.30 to every hon. Member. That is the way that was chosen to announce the policy.
If my phrase on Tuesday in answer to a parliamentary question inadvertently misled the hon. and learned Member for Leicester, East (Mr. Janner) into believing that I was talking about an oral statement, I apologise to him. I do not think that other hon. Members were quite so conscious of the imminence and importance of a statement on glue-sniffing until a few moments ago, but if I misled others into thinking that I was talking about an oral statement, I apologise to them. The Government have followed the practice that has been followed for as long as I have been in the House by Governments with majorities of 170 or one or even with minorities. We all know that it is the usual practice to be followed.
Mr. Janner: Further to the point of order, Mr. Speaker——
Mr. Speaker: No. For good reasons, I called the hon. and learned Member to make his point of order before I really should have done, and he has made his point.
Later——
Mr. James Lamond: On a new point of order, Mr. Speaker. You will recall that a few days ago a point of order was raised on the vexed question of written copies of oral statements being made available to the Press Gallery. Did you notice today, Mr. Speaker, that the Minister for Health, in seeking to defend the making of a statement in a written answer, sought to suggest that that was much better than having an oral statement, which would be made available to the Press Gallery? Does this not show that even in Government circles it is thought that the system of giving oral statements in written form to the Press Gallery before we hear the statements is a bad way of working?
Mr. Speaker: As the House well knows, I have my own strong views on this issue. However, the subject has, I think, been adequately aired this afternoon, and I think that we must leave it at that.
Mr. Robert C. Brown: On a point of order, Mr. Speaker.
Mr. Speaker: Is it a different point of order?
Mr. Brown: It is a different point of order, Mr. Speaker, arising from the intervention of the Minister for Health. It will be in your memory, Mr. Speaker, that a few minutes ago the Minister said that before the press conference referred to by my hon. and learned Friend the Member for Leicester, East (Mr. Janner) had started, the replies to written questions Nos. 159 and 160, which embody the Government's thinking on glue-sniffing, were in the Vote Office in sufficient quantities to enable all hon. Members — [HON. MEMBERS: "He did not say it."] I have been to the Vote Office and I have found that copies of the written answers to written questions Nos. 159 and 160 are not available. I put it to you, Mr. Speaker, that the Minister of State has grossly misled the House. I ask you to rule on this issue.
Mr. Janner: Bring the Minister back here.
Mr. Speaker: Order. The hon. Member for Newcastle upon Tyne, North (Mr. Brown) will know that the answers to written questions go to the hon. Member concerned and also to the Library, but they will not be found in the Vote Office.
Mr. Janner: Scandalous.
Mr. Speaker: It is a fact.
Mr. Janner: On a point of order, Mr. Speaker.
Mr. Speaker: I have given the hon. and learned Member a very good run.
Mr. Janner: One sentence, Mr. Speaker.
Mr. Speaker: No, not even one sentence.
Mr. Kevin McNamara: On a point of order, Mr. Speaker. You have just made a statement about the usual practice for supplying written answers. One copy goes to the Member concerned and one to the Library of the House. Had the Minister said that, that would have been sufficient for the House, although we would have been angry and upset. However, the Minister said that there were sufficient copies for all Members of the House. That is about 630 copies, and they are not there.
Mr. Speaker: Order. This exchange has probably been worthwhile, because it may prevent something similar from happening again.

Rate Support Grant (Documents)
4.4 pm
Mr. Robin Maxwell-Hyslop: On a point of order, Mr. Speaker. I raise this matter with you, Mr. Speaker, because of the responsibility which you have for what is or is not available from the Vote Office. Yesterday, my right hon. Friend the Secretary of State for the Environment made a statement to the House which began in column 1003 in the Official Report, in which he said:
"I should like to make a statement on the rate support grant settlement in England for 1984–85. The necessary order is being laid today and there will be debate early in the new year."
I sought to obtain a copy of the order today. Any order which is laid on the Table of the House is supposed to be available to hon. Members. After the Table Office had been good enough to make inquiries of the Department, I was informed that no such order had been laid or would be laid. If any hon. Members are looking for a non-existent order, as I was, which has not been laid, they will be wasting their time.
In the second paragraph of the statement my right hon. Friend said:
"The rate support grant report"—
that is an entirely different document—
"which is published today, copies of which will be in the Library, deals with three elements which bear on the level of local authority current spending."— [Official Report, 14 December 1983; Vol. 50, c. 1003.]
That report, though it was presumably published yesterday, was not and is not available in the Library. Instead, it is available in the Vote Office. It is apparently —I am grateful to the Table Office for unravelling this —not the non-existent order that the House will debate early in the new year, as my right hon. Friend said. The debate will take place on a motion to approve the report which is in the Vote Office and not the Library. The House will be invited to debate that motion and to come to a conclusion on it in the new year.
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I am raising this point of order because it is wrong that the Vote Office should be blamed for not having available an order which has not been laid and that hon. Members should waste their time trying to obtain in the Library what, contrary to the Minister's statement, has been put in the Vote Office and not in the Library. It might be helpful to right hon. and hon. Members to have that information.
Mr. Speaker: The hon. Member for Tiverton (Mr. Maxwell-Hyslop) has answered his point of order far better than I could.
Mr. James Lamond: On a point of order, Mr. Speaker.
Mr. Speaker: Is this further to the point of order?
Mr. Lamond: It is on another point, Mr. Speaker.
Mr. Speaker: Then we should hear the Minister first.
The Under-Secretary of State for the Environment (Mr. William Waldegrave): With permission, Mr. Speaker, I may be able to assist the House. My right hon. Friend the Secretary of State regrets that he cannot be here to correct his mistake. He made the slip of the tongue to which my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop) referred. He referred in the first pargraph of his statement to an order, when he should have said "report". My right hon. Friend has asked me to apologise to the House for that small mistake, and that is what I do.
Mr. Janner: On a point of order, Mr. Speaker.
Mr. Speaker: Order. I must ask the hon. and learned Gentleman to resume his place. He must understand that we are now to move on to business questions, after which, I understand, a statement is to be made. I am not prepared to call the hon. and learned Gentleman again.

Business of the House
4.13 pm
Mr. Neil Kinnock: May I ask the Leader of the House whether he will state the business for next week?
The Lord Privy Seal and Leader of the House of Commons (Mr. John Biffen): Yes, Sir. The business for next week will be as follows:
MONDAY I9 DECEMBER—Motion for the Christmas Adjournment. Proceedings on the Consolidated Fund Bill.
TUESDAY 20 DECEMBER—Second Reading of the Health and Social Security Bill.
Motions on the draft Social Security (Contributions) Amendment (No. 6) Regulations 1983; the draft Social Security (Treasury Supplement to Contributions) Order 1983; and the draft Social Security (Contributions, Re-rating) Order 1983.
Motion on the Fisheries (Amendment) (Northern Ireland) Order.
WEDNESDAY 21 DECEMBER—Remaining stages of the Housing and Building Control Bill.
THURSDAY 22 DECEMBER—It Will be proposed that the House should meet at 9.30 am, take questions until 10.30 am and adjourn at 3.30 pm until Monday 16 January.
Mr. Kinnock: The Opposition will bitterly oppose the Second Reading of the Health and Social Security Bill next Tuesday, which does nothing but impoverish young adults and establish quangos at the expense of the poor and the ill.
The Opposition remain concerned about the international situation. Can the Leader of the House confirm that, in the event of a serious deterioration in the many areas of conflict, there are contingency arrangements to recall the House?
Finally, with the recent discussion in mind, can the right hon. Gentleman assure us that when a Minister gives an undertaking that a statement will be provided on Government policy he will at least clarify in precisely what manner the statement will be given—whether it will be given to the press first, or brought to the House so that hon. Members can listen to it, or read it. and ask questions on it?
Mr. Biffen: I will consider the right hon. Gentleman's final point, which touches the heart of the smooth running of arrangements not merely between the usual channels and the Front Benches but through the House in general.
The right hon. Gentleman promises that the battle on the Second Reading of the Health and Social Security Bill will be hard fought. I thank him for that warning. We, too, shall bring our weapons. The trouble is that the right hon. Gentleman fights with the weapon of words, but we will do our best to see that we triumph not merely with the votes but also in the arguments.
The fraught international situation worries us all. Quite properly, the right hon. Gentleman draws our attention to the fact that it is within the gift of Mr. Speaker to recall Parliament should the situation deteriorate. I shall bear that point in mind.
Sir Edward Gardner: When my right hon. Friend arranges the business of the House for the new year, will he remember that many of my constituents who work at British Aerospace at Warton are anxious about the development of the agile combat aircraft, which should be
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the new fighter for the RAF and the European air forces? Will my right hon. Friend make sure that we have an opportunity to debate the future of British Aerospace as soon as possible?
Mr. Biffen: I note the point that my right hon. and learned Friend has made, and its constituency interest for him. The fortunes of British Aerospace will fall to some extent within the debate to be initiated by my hon. Friend the Member for Kingswood (Mr. Hayward) on the Consolidated Fund Bill on Monday, but I will bear in mind what my hon. and learned Friend has said.
Mr. A. J. Beith: Will the Leader of the House make a statement next week to clarify the implications for his important office of what he did last night and early this morning? When he said that he would not vote on the issue, did he not intend to protect the objectivity and impartiality of the office of Leader of the House? How did he further that aim when the Government Whips sought to use their power to overturn the recommendation of the Committee of Selection?
Mr. Biffen: The handful of hon. Members who were not here at 3 o'clock this morning can read what I said then. It was of such clarity that there is no need for further comment. If the hon. Gentleman found himself confused and misled by it, that explains a great deal about his conduct.
Mr. Beith: That is offensive.
Mr. John Stokes: Will my right hon. Friend find time next week for a debate on the position of British troops in Beirut, and also on the effect of United States policies in the middle east on the whole of the Western Alliance?
Mr. Biffen: I cannot guarantee Government time for a debate on that topic, but it could feature as one of the private Members' topics on Thursday.
Mr. Harry Cowans: I refer to the exchanges in the early hours of this morning. Will the Leader of the House give an assurance to the House that he will find time next week to seek a meeting with the Liberal party at which he will ask which seat the Liberals intend to give up of the six Select Committee seats that they hold—they are trying to get hold of a seventh—to their alleged partners in the alliance? Only when they do so will the cant that we heard last night about proportional representation have any credibility. They have six seats and their so-called partners have none.
Mr. Dennis Skinner: That is where the row is.
Mr. Biffen: This may be an occasion for the homegrown conciliation services. I regarded last night's vote as important in that it established the departmental Select Committees. I hope that we will be able to build on that.
Mr. Michael Hirst: Has my right hon. Friend seen early-day motion 345, which has been signed by nearly 200 Members?
[That this House welcomes the decision of the High Court in Glasgow in the case of the Glasgow shopkeepers who sold glue to youngsters, as confirming the crime of knowingly supplying solvent substances for abuse by youngsters; believes that the decision will be widely welcomed by parents, social workers, police and medical

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authorities who are justifiably worried by the growing menace of solvent abuse; and hopes that the heavy sentences passed on these shopkeepers will serve effectively to discourage any other such unscrupulous traders.]
The all-party motion refers to the fact that in Scotland it is a crime of common law knowingly to supply solvent for abuse by youngsters, but it has been signed by many English Members, and there is widespread concern in all parts of the House and of the country about solvent abuse. Can my right hon. Friend hold out any prospect of an early debate on this important subject?
Mr. Biffen: My hon. Friend will appreciate from what I have just announced that there will be no such occasion in Government time. Perhaps I might point out that private Members' topics will be available for debate on Thursday. Perhaps my hon. Friend will find one of them suitable.
Mr. Greville Janner: With his customary fairness on matters that affect Back Benchers, will the right hon. Gentleman reconsider the decision about having a Minister make a statement on solvent abuse so that hon. Members can question Ministers on that subject instead of Ministers merely having to give statements to the press after the press have questioned them upstairs? When making a decision, will he bear in mind the fact that the House has been misled yet again as no copies of the written answers were available to the House through the Vote Office and I am told by my hon. Friend the Member for Stoke-on-Trent, Central (Mr. Fisher) that none are available in the Library either? There is no way in which the House could have known about this matter before it was revealed to the press.
Mr. Biffen: The hon. and learned Gentleman raises a matter which understandably exercises his mind. I told the Leader of the Opposition that I shall look into this matter. I think that we shall probably best proceed in that way.
Mr. James Hill: Is my right hon. Friend not rather afeared about the decline of the British merchant shipping fleet? That decline has been going on for some years. Does he agree that everything that is associated with the British merchant fleet, flags of convenience and crew difficulties should have a complete airing now? Is it possible, perhaps after the Christmas recess, to have a major debate on the future of the British merchant shipping fleet?
Mr. Biffen: I shall bear in mind my hon. Friend's point when considering business after the Christmas recess. By the same token, however, I must be hard hearted with regard to the business for next week.
Mr. David Young: In view of the deteriorating situation in the middle east, the involvement of British troops in the Lebanon and the issue of Cyprus I must press the Leader of the House that it is not good enough to leave the matter to private Members business. How long will the Government delay before they provide time for the discussion of these urgent matters on the Floor of the House? How many British soldiers have to die in the meanwhile?
Mr. Biffen: I have already said that I am well disposed to the recall of Parliament if that is deemed necessary because of a deteriorating international situation during the recess. That gives some idea of my sympathy with the hon.
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Gentleman on this topic. I must point out, however, that there is no immediate prospect of Government time being available for a debate on this matter.
Several Hon. Members rose——
Mr. Speaker: Order. I must again remind the House that we are to have an important statement on the rate support grant for Scotland, which will be followed by a continuation of the debate on the Telecommunications Bill. I therefore propose to allow business questions to continue until 4.30 pm.
Mr. Dennis Canavan: Is the Leader of the House aware that, in the Scottish Grand Committee, the Government were heavily defeated twice after a debate on the National Health Service? If the Secretary of State for Scotland refuses to do the decent thing and resign, will the Leader of the House summon him to the Dispatch Box at the earliest opportunity so that he can make a statement reversing his policies of cuts and privatisation which threaten the very existence of the NHS? Is he aware that those policies were soundly rejected by more than 70 per cent. of Scottish voters at the general election?
Mr. Biffen: If I undertook the task of transmitting that message something would be lost in the process. As my right hon. Friend the Secretary of State for Scotland is here to listen, perhaps he will take account of what the hon. Gentleman has said.
Mr. Barry Henderson: Is my right hon. Friend aware that the problem in the Scottish Grand Committee which has been referred to is that, despite the wide understanding throughout the Committee of what subjects would be debated and despite the advice of their leadership, Opposition Members have twice tried to extend the debate? That action has been warmly welcomed by Conservative Back Benchers. Will he ensure that nothing is done to prevent the continuation of the important debate on the NHS in Scotland in the Scottish Grand Committee?
Mr. Biffen: I have been advised that my remit falls neatly outwith the proceedings of the Standing Committees. I therefore think that I had better say that take note of what my hon. Friend says rather than add to the controversy by endorsing or otherwise what has been said.
Mr. David Winnick: As the Cabinet has apparently agreed to force up electricity prices against the wishes of the Electricity Council, why should we not have a statement and why must we wait until Monday for one? Bearing in mind what such an increase means for many of our constituents, especially those with limited means, will the Leader of the House ensure that a statement is made tomorrow by the Secretary of State for Energy?
Mr. Biffen: I cannot comment on what goes on inside the Cabinet but I shall certainly convey the hon. Gentleman's anxieties to my right hon. Friend the Secretary of State for Energy.
Mr. Tony Marlow: As the powers of the House appear to have sunk so low that another institution which is largely made up of foreigners seems to have acquired the power to tax the British people to the extent of £457 million, and since my right hon. Friend is a champion of the powers of the House, will he

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please immediately bring forward a Bill which will enable Her Majesty's Government, at such time as they might consider appropriate, to withhold moneys from the EC?
Mr. Biffen: I do not see why I should deprive my hon. Friend of that piece of prospective Friday entertainment.
Mr. James Lamond: Will the Leader of the House ask the Home Secretary to come to the House next week to announce that he will institute an inquiry into the conduct of the police at Warrington recently, in view of the increasing anxiety of the public as expressed in correspondence to hon. Members, including a letter which I received this morning, which says:
"the police moved in and provoked a confrontation … the police quite blatantly attacked people who were involved in a peaceful demonstration."
The Oldham branch of the National Union of Journalists wrote that letter on behalf of 50 of its members, several of whom—they are trained observers, of course—were present on that occasion. Is he aware that those people want some action with regard to what happened there?
Mr. Biffen: I believe that there are complaints procedures. I shall of course draw the attention of my right hon. and learned Friend the Home Secretary to the hon. Gentleman's point.
Mr. Robert Atkins: Has my right hon. Friend noticed that on item 1 of Orders of the Day for today — the Telecommunications Bill — the blocking motion is tabled by the Leader of the Social Democratic party? Does that represent a change in the operation of the usual channels? Will it mean that in future the official Opposition will concentrate on getting its act together rather than leaving it to the unofficial Opposition?
Mr. Biffen: I do not believe that I have any formal responsibility to answer that question, which I regard as purely mischievous in motivation.
Mr. John Home Robertson: As the Secretary of State for Scotland is to make a statement and table an order on rate support grant in Scotland shortly and as that is a matter which affects Scotland specifically and exclusively, would it not make sense if the order were dealt with in the Scottish Grand Committee, which is empowered to deal with matters that affect Scotland exclusively? The Grand Committee once again showed this morning that it is well able to carry out those powers, when it defeated the Government by 32 votes to 14.
Mr. Biffen: I shall of course consider that observation, with my right hon. Friend. No doubt I shall be in touch with the hon. Gentleman.
Mr. Harry Greenway: Bearing in mind the widespread interest on both sides of the House and in the country in the House Buyers Bill which is due to come before the House tomorrow, and the rumours of the Government's possible intentions in regard to it, will my right hon. Friend give the House any guidance in anticipation of tomorrow's debate?
Mr. Biffen: I do not think that I am in the business of guidance but, on the other hand, it would be thought perverse if I did not respond to my hon. Friend's question. The Government would like more liberalisation in the conditions of conveyancing, but that does not necessarily mean endorsing the proposed legislation.
Mr. Paddy Ashdown: In view of the disgraceful and inappropriate reply which the Secretary of State for Trade and Industry gave yesterday when he refused to condemn or even look into the fact that firms in Britain might be manufacturing leg manacles, chains for gangs and other instruments of torture, will the Leader of the House please consider that matter for debate early in the new year, as such manufacture is an affront to Britain and a shame on humanity?
Mr. Biffen: I will, of course, give the matter consideration, but I cannot be optimistic about the likelihood of Government time being available. As this is an issue on which the hon. Gentleman intends to crusade, I think he might at least make an early attempt by seeking for it to be one of the private Members' topics that are chosen on Thursday.
Dr. John Marek: Substantial all-party support is evidenced by early-day motion 249 for the provision of launch aid for the European A320 airbus.
[That this House congratulates British Caledonian Airways on its recent decision to buy the Airbus A320, 25 per cent. of which should be built in Great Britain thereby creating and safeguarding British jobs and keeping the United Kingdom in the vanguard of civil aviation technology; and calls upon Her Majesty's Government to facilitate the participation of British firms in this collaborative project, which is of such crucial importance to the long-term future of the European civil aircraft manufacturing industry.]
Will the Leader of the House provide time for an early debate in the new year, especially if the Government decision whether to provide launch aid is to be delayed much later than the end of January?
Mr. Biffen: I take account of the point that the hon. Gentleman makes. He will also appreciate that on Monday the first topic in the debates that follow the Consolidated Fund Bill will be devoted to launch aid. I think we had better see how we go on that occasion. I am, of course, well aware that the House may wish to come back to this matter in the new year.

Adjournment Motion (Ballot for Debates)
Mr. Speaker: While the House is full, I should like to make a brief statement about the ballot for debates on the Adjournment motion next Thursday.
I remind hon. Members that up to nine Members may raise with Ministers subjects of their choice. Applications should reach my office by 10 pm on Monday next. A ballot will be held on Tuesday morning, and the result will be made known as soon as possible thereafter.

Rate Support Grant (Scotland)
Mr. Speaker: I call the Secretary of State for Scotland to make a statement.
The Secretary of State for Scotland (Mr. George Younger)rose——
Mr. Dennis Canavan: On a point of order, Mr. Speaker. On what authority is the Secretary of State making this statement, bearing in mind the fact that earlier this week he was twice decisively rejected by the majority of the elected representatives in Scotland and earlier this year was similarly rejected by over 70 per cent. of the people of Scotland? It is a scandal. He ought to resign.
Mr. Barry Henderson rose——
Mr. Speaker: I hope this will not delay the proceedings.
Mr. Henderson: The only rejection to which the hon. Member for Falkirk, West (Mr. Canavan) referred was of his own Front Bench by himself and his hon. Friends.
4.30 pm
Mr. Younger: With permission, Mr. Speaker, I should like to make a statement about the rate support grant settlement for Scotland for 1984–85. This amplifies the information given to the House on 12 December in answer to a question by my hon. Friend, the Member for Fife, North-East (Mr. Henderson).
I have completed my consultations with the Convention of Scottish Local Authorities about the rate support grant settlement and I shall lay before the House in due course the rate support grant order and report for the financial year 1984–85. This provides for a total relevant expenditure figure of £3,205·9 million and aggregate grants of £1,930 million. The provision for current expenditure within the total is £2,736·6 million, slightly above the provisional figure which I announced on 27 July, reflecting mainly technical adjustments. The rate of grant derived from these figures is 60·2 per cent. compared with 61·7 per cent. in the present year. [HON. MEMBERS: "Shame."]
The provision for relevant expenditure represents a cash increase of 3·8 per cent. over the provision for 1983–84 once account is taken of the reduction in the national insurance surcharge. It is also some £60 million above the provision for 1984–85 indicated in the public expenditure White Paper, Cmnd. 8789. For 1984–85 £75 million will not be allocated to services in recognition that authorities are likely to spend more than the Government consider desirable. Current expenditure guidelines were issued to all authorities on 18 November 1983 in finance circular 13/1983, a copy of which is in the Library of the House. Guidelines for 1984–85 include the provision not allocated to services and have been constructed to take account of the relative spending needs of authorities.
In 1984–85 the needs element, which accounts for 87 per cent. of rate support grant, will be distributed on the same basis as that on which guidelines are constructed, namely the client group. Although COSLA officially asked that this change should be deferred until 1985–86, there is a wide measure of agreement that this method offers a much more systematic approach to distribution, and I did not wish to make the change coincide with the general property revaluation of April 1985. It will mean changes in the amount of grant paid to a number of
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authorities. In order to dampen the effects, I propose transitional arrangements which will limit the grant loss to authorities to the equivalent of a 2½p rate at regional level and a 1p rate at district level. All authorities have been told in finance circular 14/1983 issued on 14 December of the amounts of grant they will receive in 1984–85 if the House approves the rate support grant order. A copy of this circular has been placed in the Library of the House.
The rating effects of the settlement will depend mainly on the expenditure decisions of authorities. I urge them to get their spending into line with expenditure provision. if they do, there could be, on average, a decrease in rates, although I accept that the individual circumstances of authorities will produce variations round the average.
I consider this to be a very fair settlement. There is no need for rates to go up if authorities reduce their expenditure, as I have been urging them to do since 1979. If authorities overspend, I will take appropriate action, but I very much hope that authorities will make that unnecessary.
Mr. Donald Dewar: The statement confirms that the Government are determined to pursue their wrong-headed vendetta against local services and those who use them. The cut of 1·2 per cent. in the RSG percentage to 60·2 per cent. means that there has been a cut of over 8 per cent. in that figure since the right hon. Gentleman entered the Scottish Office. On top of that, relevant expenditure has been increased, I believe, by approximately 3 per cent. only and not 3·8 per cent., as the Minister claims, and certainly COSLA is of that opinion. Will the Minister accept that on either basis it means a very severe reduction in real terms in local government spending, and will he not accept that this cruel combination of circumstances and decisions adds up to a damaging blow to the level of services provided or to an increase in rates that so often in the past has been the consequence of the right hon. Gentleman's policies?
Will he accept that the statement means that the Strathclyde regional council will have about £32 million less to spend this year as against last year and that that justifies the suggestion of the leader of the council that the right hon. Gentleman is, indeed, the Dracula of local government?
Has he seen the statement in the press today by the Tory convenor of the Lothian regional council that this announcement means that his authority is starting with an additional rate bill of 7p in the pound, and is that an accurate figure?
Taking Scotland as a whole, does he accept that if a 5 per cent. inflation rate, which is something more than the realistic figure, had been applied to last year's aggregate Exchequer assistance and the cut of 1·5 per cent. in the rate of grant had not been imposed, there would be approximately £80 million or more available for use to relieve ratepayers or to help the hard-pressed services such as transport, social work and education?
Finally, I make it plain to the right hon. Gentleman that we regard the statement as a wretched Christmas present for the ratepayers and those dependent on local government services. As the right hon. Gentleman has already well established over the years his reputation as Scrooge, is it not high time that he repented and reversed these unreasonable policies?
Mr. Younger: I congratulate the hon. Gentleman on his rhetoric, but not on his assessment of the statement. To

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hear him talk one would think that local government spending in Scotland had in real terms been reduced virtually every year and that every service one can think of had been decimated beyond recognition. I should have thought the hon. Gentleman would know that we have so far not even succeeded in getting any cut in real terms since 1979. That is the fact that the hon. Gentleman ought to know. The record for the period is that since 1978–79 current expenditure by Scottish local authorities has increased by 97 per cent. compared with only 85 per cent. in England and 73 per cent. for prices. In the period rates have gone up by 128 per cent. and Scottish grant has gone up just about in line with prices. The generosity that I have shown in giving grant has been reflected merely in increased expenditure that has fallen on the ratepayers instead of reductions in expenditure which is what they all want to see.
Several Hon. Members rose——
Mr. Speaker: Order. I hope to be able to call all hon. Members who are rising, but I have an equal duty to protect the business of the House. I propose to permit questions on this matter to continue until 5 o'clock. If questions are brief, I shall be able to call all hon. Members who wish to speak.
Mr. Donald Stewart: Is the right hon. Gentleman aware that comparison with the English figures is irrelevant as the conditions in the two countries are quite different? Is he also aware that he can talk until he is blue in the face about "real terms" and the rest of it, but all hon. Members who represent Scottish constituencies are aware of the cutbacks that are taking place in their authorities? Does he appreciate that, in addition to the disastrous cuts that are being made, the Government are being dishonest in boasting about reducing the numbers of civil servants, when work in the DHSS has been shelved to local authorities at the very time when they will receive less finance to carry out that sort of work?
Mr. Younger: I note what the right hon. Gentleman says, and of course he is right to say that one must be careful when making comparisons because of differences in conditions north and south of the border. That is perhaps why the differential between the rate of grant in Scotland and the rate in England is still the second highest it has ever been.
To answer the right hon. Gentleman's point about services, the figure of local authority expenditure, corrected for inflation, was £2,517 million in 1978–79, whereas in the current year it is £2,661 million, and that is in real terms. Thus, what the right hon. Gentleman says about cuts in services is not borne out by the facts.
Mrs. Anna McCurley: Does my right hon. Friend agree that while local authorities in Scotland may complain about his measures, the hard-pressed ratepayers will welcome them?
Mr. Younger: I wholly agree with my hon. Friend. It has been impressed on me time and again in recent months that the ratepayers are looking, so far in vain, for real reductions in expenditure from local authorities.
Mr. Bruce Millan: The Secretary of State is urging local authorities to get their expenditure
1184
down to the guidelines. Is he aware that, once again, the guidelines are completely unrealistic and that COSLA estimates that if they were to be met there would need to be a 5 per cent. reduction in services in real terms next year and that would mean savage cuts in essential services? The Secretary of State presumably knows what he is asking local authorities to do. Is it 5 per cent.? Will he confirm that figure? If he denies it, will he give his own figures?
Mr. Younger: I understand that that is the figure that COSLA has worked out and I do not dispute it. I have been warning local authorities for nearly five years that unless they get their spending into line they will begin to find it progressively more difficult to get down to the figures that I have given. I am glad to say that well over 20 authorities have been hitting the Government's targets quite easily, and they will find it much less difficult to meet this settlement.
Sir Hector Monro: Will my right hon. Friend continue to divert the maximum resources to those local authorities that keep within the guidelines? Is he aware that, despite the annual ritual cries of COSLA, some local authorities, such as Dumfries and Galloway, were actually able to reduce rates this year to the benefit of ratepayers and industry, both of which are doing their best to help provide more jobs?
Mr. Younger: I agree with my hon. Friend, and I pay tribute to the extremely effective efforts that Dumfries and Galloway have made, with, I believe, completely acceptable results to those who benefit from the services that they provide.
To answer my hon. Friend's question about helping the good authorities, the new guidelines give recognition in many cases to those authorities that have been successful in keeping their expenditure to reasonable levels.
Mr. Malcolm Bruce: Will the Secretary of State acknowledge that what he is actually doing is extending his pincer movement on local authorities by cutting the rate support grant and at the same time taking powers to cap rates, and in the process of doing that he is making it increasingly difficult for them to operate any kind of efficient service? Will he therefore accept that he is effectively forcing up the rates in many areas, and that will not help local businesses? Will he acknowledge that the client group method is causing considerable concern to many authorities in Scotland because it will put them in a situation in which they will have no choice other than to put up rates? My district council of Gordon has made representations to him about that.
Mr. Younger: The hon. Gentleman is not correct because for three years running I kept the rate of grant the same and all that happened was that local authorities took the opportunity to increase their expenditure. It is clear that they need some encouragement if they are to reduce expenditure to anything like the levels that we have suggested.
Mr. Michael Forsyth: Will my right hon. Friend invite local authorities in Scotland which follow the Opposition's line that the statement will mean a cut in services to follow the example of Stirling, and recognise that we have in power a Government who mean what they say? Will he urge them to reorganise their direct labour organisations and root out overmanning throughout their departments, and thus be able to achieve savings without

1185
having to cut services? It is ridiculous to see the crocodile tears of Labour Members—[Inrerruption.]—because it is nonsense for the Opposition to claim that it will mean cuts in services when hardly any local authorities in Scotland have bothered to test the efficiency of their services by inviting competition.
Mr. Younger: I agree with my hon. Friend that there is no doubt that in many cases efficiency can have a helpful effect on the needs of local government to draw on ratepayers' money. The answer to his second point is that, unless this sort of step is taken, local authorities will find it extraordinarily difficult to get their spending into line.
Mr. David Lambie: The right hon. Gentleman said that he had completed his consultations with COSLA before making today's statement. Does COSLA agree with his assessment that it is a fair settlement? Or does COSLA believe that it is a further attack on local councils and represents another nail in the coffin of local democracy?
Mr. Younger: I do not understand how it could be such a thing when, in general, the amount being spent on local authorities is still more in real terms than it was five years ago. Possibly my predecessor and I will agree on one thing, and that is that there has not been a settlement for seven or eight years on which COSLA has agreed with the Government of the day.
Mr. Barry Henderson: Will my right hon. Friend pay particular regard to the position of those local authorities that have been particularly careful in their expenditure but which may be adversely affected by changes in formulae? Will he see whether in the transitional phase some help can be given to them? Will he also recognise the part that they have played and continue his efforts on behalf of ratepayers and taxpayers to curb the excesses of the very high spending Labour local authorities?
Mr. Younger: I am grateful to my hon. Friend for those remarks. I have, in adjusting the distribution of grant to the new client group method, deliberately introduced transitional arrangements that will be somewhat less onerous on those local authorities that would have suffered from the charges, and I hope that that will be regarded as helpful.
Mr. Tom Clarke: Is the Secretary of State aware that the projected figure for inflation in the statement—I should be grateful if, for the record, he would repeat it — is already obsolete in view of a Cabinet decision this morning about electricity charges? Is he further aware that the cuts in the Health Service mean that a greater burden is placed on social works departments in local government and that that is not reflected in the settlement? Does the right hon. Gentleman agree with his hon. Friend the Member for Birmingham, Selly Oak (Mr. Beaumont-Dark) that statements of this kind are a body blow to local government and, therefore, to democracy?
Mr. Younger: The hon. Gentleman asked for the figure. The cash increase in the provision is 3·8 per cent. He will be able to compare that with his assessment of whatever the rate of inflation is likely to be during the year in question. Local government's position is no different from that of everybody else in the country.
To answer his point about cuts in the Health Service, I remind him that we have been discussing this matter
1186
usefully for two mornings—I hope that we shall have a third morning—and it has clearly been shown that the Government are still providing considerably more money in real terms for the NHS than was provided by the last Labour Government.
Mr. Michael Hirst: Does my right hon. Friend recognise that many local authorities in Scotland have still failed to identify proper spending priorities, as evidenced by the fact that last year 27 local authorities had to forgo £13·5 million on capital expenditure on housing projects because they made excessive and wasteful rate fund contributions? Does he accept that the modest decrease in the rate support grant that he has announced today compares most favourably with the enormous cuts that we saw in Scotland when Labour was last in Government? Does my right hon. Friend realise that the business community in Scotland will be delighted that the Government are sticking to their plans on public expenditure?
Mr. Younger: I am grateful to my hon. Friend for that observation, and representatives of the business cornmunity have already made that point to me. It amazes me that local authorities in Scotland, which are alleged to be desperately short of money, should have deliberately forgone £13·5 million that they could have spent on housing capital had they wished to do so. I pay handsome tribute to the Labour party which, when in Government, held, and still holds, the record for the largest ever cut in the rate support grant when they cut it by four percentage points in one year. I give them full marks for that.
Mr. James Hamilton: Having had his meeting with COSLA, did the right hon. Gentleman, in arriving al his rate support grant conclusions, take into consideration the many local authorities which are saddled with houses that are unfit for human habitation because of dampness? With winter now very much upon us, did he take that into consideration? If he did, at what conclusion did he arrive and what will he do about this problem?
Mr. Younger: I appreciate the hon. Gentleman's concern about dampness. He will no doubt readily appreciate that we have, by a long way, the largest ever programme of house improvement. This is a rate support grant measure. In due course there will be a housing support grant order.
Mr. Albert McQuarrie: Is my right hon. Friend aware that rural authorities in Scotland, especially those that keep within spending limits, will welcome his statement? Despite the comments of the hon. Member for Gordon (Mr. Bruce), constituencies such as Banff and Buchan that have kept within the guidelines and support the new system adopted by my right hon. Friend will welcome this measure. I hope that my right hon. Friend will ensure that the small authorities that keep within the guidelines will not be penalised by the activities of overspending Labour authorities in the west of Scotland.
Mr. Younger: A remarkable feature is that authorities, such as Banff and Buchan, which have managed to get their expenditure well in line are also producing services that are acceptable and satisfactory. Other authorities that apparently find that difficult could well take a lesson from them.
Mr. Dick Douglas: Does the Secretary of State accept that casting himself in the role of the Christmas good fairy is a gross piece of miscasting? Which authorities have told him that they might reduce their rates? What will be the effect of his policies on the fabric of local democracy? I accept that there must be constraints on public expenditure, but there is a partnership between central and local government. He is dictating to local authorities how they will serve their citizens. Does he not accept that this is putting an unsavoury strain on local democracy?
Mr. Younger: I am not certain how the roles of Dracula and the good fairy can be combined, but I will see what I can do.
Any authority that received this news a few days ago and was already sufficiently efficient in fixing its rates would be remarkable. If local authorities were to meet the expenditure figures that I have put down—more than 20 are already doing so in the current year—they could, on average, reduce rates by between 5 and 6 per cent.
The hon. Gentleman's statement about local democracy was exceedingly overblown. Local democracy is unimpaired by the fact that, as the previous Labour Government and this Government have always insisted, the national economy must have some assurance that local authorities will not deduct too much of the public expenditure available. We have managed to protect, for example, the National Health Service and to increase its expenditure by getting other services to become more economical.
Mr. Bill Walker: Does my right hon. Friend agree that the real problem for many years has been that authorities with similar responsibilities and services have wide differences in their expenditure programmes? If there are any Draculas among local authorities, they are those local authorities that suck the lifeblood of others for their sustenance. That includes authorities that are depriving the health boards of much needed funds, as the Dundee district council has done for many years.
Mr. Younger: I appreciate my hon. Friend's comment about the differences between authorities. One of the most remarkable features — despite what has been said by Opposition Members — is that, in spite of the many difficulties, a large number of authorities are managing apparently to reach easily the Government's targets.
Mr. Charles Kennedy: Will the Secretary of State at least bear in mind, when he claims that there is a wide measure of agreement about the client group approach, that that agreement does not extend to the Highland regional council which is a large section of the country at least geographically, if not politically? The hollow nature of the Government's economic policies on local government in Scotland was exemplified by that regional council which pointed out that, but for the clawback of £1·6 million a few months ago, it would have been able to do exactly what the Secretary of State asked —to cut rates in the Highland region by 3½p in the pound.
Mr. Younger: I know that the Highland region has special difficulties. That is why the rate support grant settlement makes extra provision for that area. I am sure that the region very much appreciates that.
Mr. John Home Robertson: How can the Secretary of State sustain the image that he is trying to create of being the ratepayers' friend when the rate support grant settlement is likely to increase the rates for my constituents in the Lothian region by 7p in the pound? If he does not like to take that figure from me, will he accept it from Mr. Brian Meek, the Tory convenor of the Lothian regional council?
Mr. Younger: The hon. Gentleman must know that whether or not rate increases occur in a particular authority will depend very much on whether it increases its expenditure. In general, if local authorities meet the Government's targets, there will be rate reductions.
Mr. Dennis Canavan: Why is the Secretary of State pushing councillors on to the horns of a dilemma whereby they must choose between further rate increases or cuts in essential services, such as education and social work? If they choose rate increases, they are not given the freedom to carry them out. Is this not threatening what little local democracy is still left to local government in Scotland? Is it not a disgrace that we have this measure, bearing in mind that many of those councillors have a better mandate to represent the people of Scotland than a discredited Secretary of State who has no mandate from the Scottish people and who has twice been defeated in the Scottish Grand Committee?
Mr. Younger: It is clear that the Labour party has no mandate either, and the hon. Member ought to remember that. I understand that this week the hon. Member managed to. spend approximately two and a half hours on two mornings in the Scottish Grand Committee discussing the National Health Service and then passed a resolution saying that he had not.
Mr. George Robertson: Does the Secretary of State care that if local councils do the dirty work on behalf of the Government that will lead only to one of two things: the deliberate calculated destruction of jobs when hundreds of thousands of Scottish people are already out of work, or the reduction in common services that are designed to help the weakest, sickest, oldest and poorest in the community? Is he not ashamed of such an objective?
Mr. Younger: I do not know how the hon. Gentleman works out that I am cutting services for the weakest, sickest, oldest and poorest if the amount expended in real terms is higher than it was under the Labour Government. That makes no sense. The hon. Gentleman ought to know that increasing rates to unacceptably high levels destroys jobs more quickly than anything else.
Mr. James Wallace: The Secretary of State will, no doubt, be aware that in the present financial year the Orkney Islands council received £1 million, in addition to the rate support grant, as partial compensation for loss of revenue due to the de-rating of external plant. As that loss of revenue must be continuing, will £1 million be made available to the council in the forthcoming year?
Mr. Younger: I made it clear to COSLA last week that the special help that was given last year would not be continued next year. The hon. Gentleman will probably agree that the finances of the Orkney Islands council are very healthy.
Mr. Ernie Ross: I am conscious of the Secretary of State's concern for law and order. If the cuts that he is forcing on local authorities cause them to break their statutory obligations to children in care and to the elderly and disabled, will he indemnify them against any consequences if legal action is taken against them?
Mr. Younger: If a local authority decided to concentrate any cuts on those services, that would be its decision and priority. The expenditure allowed overall for Scottish local authorities does not suggest that any such action would be necessary.
Mr. John Maxton: Is the Secretary of State aware that this statement is even meaner than that made yesterday by the Secretary of State for the Environment? At least his right hon. Friend made it clear that he would disregard extra expenditure on community schemes jointly funded with health authorities. Is the Secretary of State prepared to do the same, especially as the Scottish record on the joint finance schemes is far worse than that in England and Wales?
Mr. Younger: It is true that there have been more difficulties in getting both parties to the joint financing arrangement to come together in Scotland to put the schemes under way. I regret that as much as the hon. Gentleman. We are doing all that we can to encourage both parties to come together.
Mr. Gerald Malone: Does my right hon. Friend agree that part of the problem is that cuts in services are necessitated not by central Government reductions in spending but by politically motivated local authorities which go out of their way to cut sensitive services so as to grab cheap political headlines?
Mr. Younger: I agree with my hon. Friend. If one thing is absolutely contemptable, it is to try to make out that the only way to save money is to hit the most vulnerable. If the Opposition really wish to support that type of policy, I shall be very surprised.
Mr. William McKelvey: Will the Secretary of State take part in an age old Scottish
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custom and make some genuine new year resolutions—to purge his soul, to throw off the shackles of the mad monetarist Prime Minister under whom he operates, and to hand back to the local authorities the democratic right, which they were elected to exercise, to make up their own minds, to set the rates as they see fit and to give the people the service that they promised in their manifestos?
Mr. Younger: I am not sure that it is physically possible to purge one's soul and to cast off shackles at the same time, but I will have a shot at it.
Mr. Dewar: May I take the Secretary of State back to Lothian council as a specific example of the general position? Does he accept the calculation made by Mr. Brian Meek, leader of the Conservative group, that the settlement is equivalent to a reduction of about 7p in the pound and that the only way to avoid that additional burden on the ratepayer is to reduce the services offered by that Conservative controlled council?
Mr. Younger: I agree with neither point. The only person who can tell at this stage what the figure is in pence per pound for any given local authority is the administration of that authority. If the figure that the hon. Gentleman mentioned is that worked out by the council, I am prepared to accept it. I am sure that the hon. Gentleman will agree, however, that if all authorities—not just Lothian—brought their expenditure down to the levels suggested by the Government, reductions in rates would be possible. That is the message for which ratepayers in Scotland are waiting, but they have not heard it from the hon. Gentleman.

BILL PRESENTED
  LEASEHOLD (SCOTLAND)
  Mr. Gordon Wilson, supported by Mr. Donald Stewart, presented a Bill to make provision for, and to confer new rights upon, tenants under long leases, and certain other occupiers in Scotland: And the same was read the First time; and ordered to be read a Second time upon Friday 3 February and to be printed. [Bill 77.]
Orders of the Day

  Telecommunications Bill
  [2ND ALLOTTED DAY]
  As amended (in the Standing Committee), further considered.
  Amendment proposed [14 December]: No. 43, in page 51, line 14, leave out clauses 56 to 68. — [Mr. Fisher.]
  Question again proposed, That the amendment be made.
  5.4 pm
  Mr. John McWilliam: As a former treasurer of the city of Edinburgh, I have never been so tempted to intervene but I managed to avoid getting involved in the previous business.
  When the guillotine fell last night we were dealing with a debate initiated by my hon. Friend the Member for Stoke-on-Trent, Central (Mr. Fisher) on the Government's reasons for privatisation. It may be convenient if I summarise briefly the reasons given. The Government argue that the creation of competition will be an inevitable consequence of breaking BT's monopoly, that privatisation will free BT of state control, provide free access to capital markets and commercial freedom for managers and spread share ownership. In the short time available for the debate, I intend to prove that the Government are wrong.
  The first and fourth arguments — the creation of competition through the breaking of BT's monopoly and the provision of commercial freedom for managers—are not compatible. If managers exercise that commercial freedom BT's monopoly will not be broken. Freed of the main fetters of answerability to the state, this giant in communications technology will rapidly begin to gobble up all its competitors. I do not believe that the Office of Telecommunications set up by the Bill or the Secretary of State's powers under clause 3 would always provide protection against that.
  As for freeing BT from state control, clause 3 was extensively debated yesterday. Anyone who doubts that the Secretary of State will still have considerable residual powers of control over BT cannot be aware of that debate. There is no intention to free BT from state control until 51 per cent. of the shares have been sold. As my hon. Friend the Member for Stoke-on-Trent, Central reminded the House, the proceeds of the sale will probably be about £4 billion. That already includes a 12 per cent. discount on valuation when, given the prospects of BT and the information technology industry, the shares should be sold at a premium rather than a discount. Nevertheless, that has been the case in almost every instance of privatisation so far.
  The Minister singularly failed to convince the Standing Committee that the Bill would spread share ownership, nor can he cite any instance in the Government's privatisation activities thus far to suggest that that is anything other than a spurious argument. One has only to look at the Amersham International experience. In February 1982, there were 65,000 successful applications for shares, but those shares now rest with only 8,601 holders. Further
  1192
  investigation shows that less than 9 per cent. of the holdings are in lots of under £12,000 and two thirds are in lots of more than £250,000. Anyone with any knowledge of social trends and the distribution of wealth in this country will quickly realise that very few people are in a position to hold shares in lots of more than £250,000. It is therefore neither reasonable nor credible to say that share ownership in BT will spread.
  As for free access to capital markets, my hon. Friend the Member for Stoke-on-Trent, Central rightly pointed out that for some time BT has not needed free access or indeed any access to capital markets. In the last financial year its external financing limit was a negative one, with £100 million coming from BT to the state rather than the other way round. Moreover, the projected figure for the next financial year is £350 million. In a sense, that is unfair. The Minister is asking existing telephone customers to pay for services to be provided for future customers. That is a crazy way to proceed. Given the Government's daft attitude to the public sector borrowing requirement, it is understandable from the Government's point of view, but from any sensible point of view it is plain daft.
  The public sector borrowing requirement is a unique conception. For a start, in evidence to the Select Committee on Procedure (Finance) the Treasury officials said that the PSBR was the difference between two sums, both of which were estimates, and that the difference on any one calculation was liable to be accurate within plus or minus £1 billion. That is not very accurate. They spend their lives defending such issues. No other western economy operates a concept such as the public sector borrowing requirement. The reason why the Government operate such a concept is that it subsumes within it their own borrowing requirement.
  Statements were made yesterday and today about the rate support grant order—a factor within the PSBR. We have a PSBR to enable the Government to hide their profligacy with regard to their steadily increasing borrowing requirement underneath the blanket of local government and the nationalised industries. That is why they continue with it, and it is an absolute nonsense. There can be no reason for a measure such as the Government's own borrowing requirement which refers to borrowing against needs such as social security, the cost of the Civil Service and so on. It is crazy to equate a figure which applies to public sector borrowings that are essentially commercial and paid for entirely by the relevant concerns — in the case of BT, more than entirely — to any Government activity in the public sector. I assume that that is not done for the best possible reasons.
  Amendments 44, 45, 46 and 47, standing in the name of the Secretary of State for Trade and Industry, have suddenly appeared on the Amendment Paper. An article in today's Financial Times states:
  "Move over BT pension fund deficit".
  I am fairly certain that my eloquence yesterday did not cause the sudden panic, but other activities within the market were responsible. The article states:
  "The Government took an important step yesterday to clean up"—
  note the phrase "clean up"—
  "British Telecom's balance sheet before it is privatized … by agreeing to remove £1·25 billion pension fund deficit from the organisation's balance sheet."
  The article continues:

  1193
  "liability for the deficit will not be transferred to BT when the organisation is turned into a public limited company next year, but will remain with the shell of the BT nationalised industry structure."
  I do not know the meaning of the last phrase because under
  the terms of the Bill such a structure will not exist.
  The article continues:
  "BT plc will issue to the Government debentures, the value of them to be decided later,"—
  that is interesting—
  "on which it will make payments. If its contributions are insufficient to discharge the liability, the shortfall will be made up by the Government.
  The formula is intended to reassure prospective investors who might be deterred from buying shares in BT if the large pension fund deficit were to remain on its books. BT welcomed the decision."
  Of course it welcomed the decision.
  Several questions arise from that article, not least, why was it leaked to the press? Why did not the Minister tell the House what he would do? Why did he not table the amendments and inform the House of the programme? I admit that he said that he would do something, but that seems a little less than kind.
  Mr. John Golding: The only charge that can be laid against the Minister is that he did not speak to the amendment when replying to questions from my hon. Friend the Member for Stoke-on-Trent, Central (Mr. Fisher) yesterday. We could have asked about the specific amendment but we did not. We asked general questions. In those circumstances, the Minister cannot be charged with not tabling the amendment.
  Mr. McWilliam: I am grateful to my hon. Friend and I accept his admonition. I charge the Minister not with failing to table the amendment, but with not making a statement during yesterday's debate, which would have been the appropriate time. Perhaps it occurred to the Minister that if one includes the pension fund deficit with the other liabilities of BT, which are geared at 57 per cent., investors might not consider the proposition to be attractive.
  Will the Under-Secretary of State explain the loss, as it is something about which I am not clear? I am fairly certain that my hon. Friends are not clear about it and I am absolutely certain that the Under-Secretary's right hon. and hon. Friends are completely mystified by it. Will the Under-Secretary, for the convenience of the House, explain the state of affairs and say what will happen?
  5.15 pm
  The Under-Secretary of State for Trade and Industry (Mr. John Butcher): I appreciate fully the reasons for the concluding remarks of the hon. Member for Blaydon (Mr. McWilliam). I thank him for his invitation to enable me to clarify the matter, especially bearing in mind that the hon. Member for Stoke-on-Trent, Central (Mr. Fisher) raised several searching points. The motivation of the hon. Member for Blaydon was to seek reassurance so that the pensioners of BT are absolutely clear about the commitments that the Bill and the Government make towards them. The pension fund obligation, which passed from the telecommunications part of the Post Office to British Telecom when the Post Office was split in 1981, would, under the Bill as currently drafted, pass to the successor company on the transfer date.
  The presence of this obligation in British Telecom's balance sheet gives rise to strong emotions. I sympathise
  1194
  with the feeling of BT management, its work force and with hon. Members who would regard the obligation as an anomalous and inappropiate part of the endowment to the successor company as it starts its private sector life. The deed of covenant obligation might also put the successor company in an unnecessarily unfavourable light with investors. In the exceptional circumstances of this particular, the Government have therefore decided that the deed of covenant obligation should not pass to the successor company. Instead, it will remain vested in the residual shell of the public corporation, British Telecom, which under clause 65(1) is to remain in existence for a period after the transfer date to carry out functions assigned to it by schedule 5. For ease of reference, henceforth, when I refer to British Telecom my remarks will relate to the residual company and not to the successor company.
  The amendments necessary to ensure that the deed of covenant remains with the statutory corporation and that the obligations under it are properly discharged are somewhat complex and include a substantial number of purely technical consequential amendments to the Bill's provisions on other matters such as accounts. The House may find it helpful if I summarise the main points.
  Amendments 45 and 46 to clause 56 achieve the essential first step of excepting the obligations under the deed of covenant from the vesting of British Telecom's liabilities in the successor company. Amendments 103 and 104 apply this exception to paragraphs 36 and 37 of schedule 5, which are concerned with particular aspects of the vesting operation.
  The new paragraph 38A to schedule 5 provides for the fulfilment of the deed of covenant obligations by the residual statutory corporation British Telecom. Paragraph 38A(1) places British Telecom under an obligation to discharge the liabilities concerned as they fall to be discharged.
  Paragraph 38A(2) provides that the liabilities are to be discharged out of the moneys that British Telecom—the residual statutory corporation — receives from the holding or disposing of debentures of the successor company assigned to it for the purpose by the Secretary of State.
  Paragraph 38A(5) provides for the Secretary of State to stand behind the fulfilment of the deed of covenant obligations to the pension funds. I shall clarify that further in a few moments.
  Certain other arrangements supplement this basic framework. Under paragraph 38A(3), the Government's consent would be required before BT sold any of the loan stock — the debentures — assigned to it, and under paragraph 38A(4) the Government would control the investment of any surplus moneys from the loan stocks held from time to time by BT.
  In practice, such funds would be likely to be deposited in a Government account, and would be repaid to the Government to the extent that they were not needed to fulfil BT's obligations to the pension funds.
  Paragraph 38A(6) provides for the operation of the arrangements to be reported annually to the Government and to Parliament. It would not be sensible to subject the receipts of the residual company—which are essentially concerned to fund the payment of pensions — to taxation, and the necessary taxation exemption to this

  1195
  effect is contained in paragraph 38A(7). Paragraph 38A(9) maintains the present tax exemption status of payments from BT to the pension funds.
  Mr. Mark Fisher: What exactly are the obligations about which we are talking? Is it only the pre-1969 deficit or the pre and post-1969 deficits? What sums are involved? There seems to be a difference between the figures in the Financial Times and the figures that I used yesterday.
  Mr. Butcher: The latest figure available to me is about £1·25 billion, but I understand that the trend of the deficit is falling. We are talking about the deficit in toto.
  Mr. Rob Hayward: Will a copy of this statement be placed in the Library for our consideration before this debate is completed, as important implications are involved?
  Mr. Butcher: Yes, of course. If it is helpful to the House, we shall be happy to place a copy in the Library.
  We must raise no doubts about the fulfilment of the payments due to the BT and Post Office pension funds, in full and on time. For that reason we have provided in paragraph 38A(5) that if at any time the sums of money available to the residual company were to fall short of those needed to fulfil the obligations under the deed of covenant the deficiency would be made good by the Secretary of State out of money provided by Parliament.
  Obviously we do not expect this guarantee to be called, but it is there as a necessary reassurance to telecommunications and postal employees and to pensioners whose pensions depend on the pension funds concerned.
  We are looking at the wording of clause 65(2), which states:
  "The Secretary of State may, by order made by statutory instrument after consulting British Telecommunications and the successor company, dissolve British Telecommunications on a day specified in the order, as soon as he is satisfied that nothing further remains to be done by British Telecommunications under Schedule 5 to this Act."
  Amendment No. 107 to schedule 5 states:
  "During the transitional period it shall be the duty of British Telecommunications to discharge the excepted liabilities".
  I also refer hon. Members to amendment No. 46, which defines BT's excepted liabilities—that is, the residual company — in terms of the obligation to the pension fund deficiency. That makes the position absolutely clear.
  Mr. Fisher: I am grateful to the Minister for giving way again. What about the status of the debenture stock? As a loan stock, what is its relationship to BT's new capital formation?
  Mr. Butcher: I cannot at present give the hon. Gentleman the exact figures, but I shall be pleased to get back to him, either by writing or in conversation after the debate.
  It may be helpful if I now deal with some of the questions that have been raised on many occasions. I am mindful of the fact that other hon. Members wish to speak on this tranche of clauses under which the privatisation will take place. We have had a long and interesting debate on such things as employee shareholding, foreign control and national security. We have also discussed a number of issues concerned with wider share ownership.
  1196
  We are determined that this sale should go ahead and that it should involve the widest possible share ownership. We shall bring forward measures to provide incentives to BT employees, whom we hope will take full advantage of them and will take part in share ownership.
  We also wish to see as many subscribers as possible buying shares in the company whose services they value. It may be that the Bill will mark a watershed in this trend and will ensure that large sections of the public take part in the share ownership of a national and public service of this kind.
  It is against that background that I regret that during opposition to the Bill Labour Members have perhaps been motivated by the need to make the share issue as complicated or as cumbersome as possible. They may wish to make the new corporation as unattractive as possible in terms of the sort of obligations they may wish to impose on it.
  I accept the concern of hon. Members about pensions, but I hope that when the great day comes, and when Labour Members recognise the inevitable, they will positively encourage employees whom they represent to take a real part in the ownership of a company to which they have dedicated their working lives. There is surely no better form of participation in a company than to take a part of its ownership.
  The Government's financial advisers, the six brokers and the London Business School have all stated with confidence that the sale can be made. We shall need to consider the methodology. For example, payment by instalment is an acceptable City practice. This is now under active consideration. As I have said, we are determined to bring forward attractive incentives for employees and subscribers.
  I again make it clear that the Government will give every BT subscriber—some 18 million ordinary people —an opportunity to purchase shares in BT. It is right that customers who, through the tariff, have paid to build up BT should have the right to buy back a direct share in their own company.
  My hon. Friend the Minister of State is incapacitated temporarily but, we hope, not for long. He has a touch of the "Islwyns" or what used to be called the "Bedwelltys". He has temporarily lost his voice, no doubt through great works in the public service. He has spearheaded a personal campaign to ensure that wider share ownership lives and breathes through the Bill. The Bill will be his testimony to an important trend that the Government are anxious to pursue and enhance.
  I commend these many clauses, which deal with the heart of privatisation and flotation, to the House. I trust that they will be supported.
  5.30 pm
  Mr. Stuart Randall: I should like to refer to the whole of this part of the Bill on privatisation and the introduction of private shareholding in BT. Conservative Members are aware that we are very much against this because we believe it will be disadvantageous to the people, to BT and to the telecommunications industry and all that it stands for. No matter how much it is knocked or what is said about it, BT has had a remarkable achievement. Investment in the industry has been notable. Its assets amount to about £16 billion.

  1197
  It is these assets which will be sold by the Government. In terms of its financial performance, BT is not a burden on the taxpayer. It has been running at a profit over the last eight years, a period during which there has been much change. There have been technological changes as we have shifted from Strowger to crossbar and now to the complex electronic exchange equipment. There has been a difficult period because of the changes in cable technology, but BT is making good progress. In regard to the organisation of the corporation, this legislation is a real kick in the teeth from the Government for the people who have done so much to build up the industry.
  As a publicly owned corporation, BT is accountable. The public has certain statutory rights through consumer watchdogs which have helped the consumer in many ways. In addition, BT is obliged to submit to Government Departments its annual operating plans so that its performance and what it is aiming to do are known and monitored. That is for the good of telecommunications.
  BT also has social and community obligations. This is where hon. Members divide strongly. My hon. Friends and I believe this is important in ensuring that there is equity in communications and that there should not be a privileged few who get certain services. BT is carrying out a massive investment programme in switching and cabling equipment. British suppliers are getting about 95 per cent. of this business. It is these industries that the Government are so intent on destroying as they rush ahead with the programme of privatisation and the sale of assets.
  Mr. Tony Marlow: It beggars all understanding that the hon. Gentleman can stand there and say that the Government are intent on destroying certain parts of British industry, particularly when he well knows that those parts of British industry are supporting the Government in their endeavour to liberalise and free the telecommunications industry. What motive could the Government possibly have for wanting to destroy a large, important, successful, growing part of British industry? Gracious me, what is wrong with the hon. Gentleman?
  Mr. Robert Hughes: They have been destroying British industry since 1979.
  Mr. Randall: The hon. Member for Northampton, North (Mr. Marlow) clearly does not understand the implications of Government policy and of the White Paper for British manufacturing industry. He should go to a telephone and ask Lord Weinstock what he thinks of the Bill; no doubt he would condemn it just as I have done.
  A privatised BT will not be obliged to support British industry. There is no question about that. Sir George Jefferson has made it clear that he will be out to maximise his profit. He will buy switching equipment on the world market. Many hon. Members understand the telecommunications market throughout the world. We must remember that manufacturers in many countries are subsidised to an incredible extent. Equipment will be coming into this country below cost price. Under the Bill BT will be able to buy this equipment and it is for this reason that I believe British manufacturing industry will be annihilated.
  Mr. Marlow rose——
  Mr. Randall: If I may finish the point, the loss of job prospects will have a detrimental effect upon the British telecommunications industry. I mean it in the kindest possible way when I say that the Minister has effectively
  1198
  brought home to the British people the consequences of information technology. To destroy the industry which would implement many of the ideas which he has effectivly put over to the country would mean the destruction of those ideas for the development of information technology.
  Mr. MarlowThe hon. Gentleman is entitled to his misjudgment as to what is likely to happen. What the hon. Gentleman started by setting out was that it was the Government's intention to destroy sections of British industry. How on earth could any Government have the intention to destroy sections of British industry? Can the hon. Gentleman explain that?
  Mr. Robert Hughes: They have been doing it since 1979.
  Mr. Randall: As we have said in Standing Committee, the whole theme of the Bill is privatisation and the maximisation of profit. Those are the goals of the Government. They want to create an environment in which profits can be made. Manufacturing industry therefore has second priority. The effect on jobs is a second priority and of no interest to the Government. That is why we are so unhappy about the Bill.
  Investment in manufacturing industry is taking place at the rate of £2,000 million per annum, so the effect on jobs will be considerable. BT is an efficient and good company, however people may knock it. Over the last 10 years it has made remarkable productivity gains. In [971 the total number of telephones was 9,214,000 and the work force was 232,377. By 1983 the number of telephones had gone up to 19,429,000—a remarkable advance although there is much further to go--with a work force of only 245,976. That is a remarkable track record. Of course, the increase in the work force, as we are talking about productivity, is trivial.
  The BT work force has shown that it is willing to adapt to change. There have been no disruptions in the industry in an environment where there is changing technology. It is important that good telecommunications services should be provided for everyone. There should be no discrimination.
  In regard to residential use, all citizens should have a high standard of telecommunications services. Let us not be equivocal about this. High standards of communications are of the utmost importance to the people and to the economy. These high standards of communications facilities should be available to people irrespective of what part of the country they live in, whether it be a rural part of Scotland or the south-east of England. We believe that there should be no discrimination between the residential user and the business user, but the Government's policy is unquestionably biased against the residential user in favour of the business user. We believe that nowadays the telephone is a necessity of life and that everyone should have a telephone irrespective of social status.
  Mr. Marlow rose——
  Mr. Randall: The hon. Gentleman is always intervening. I shall carry on.
  Mr. Marlow rose——
  Mr. Randall: I have given way enough times. I shall finish my argument.
  Our philosophy is to provide a national high quality telecommunications service for all people. Such a service

  1199
  will end once BT is privatised. That is what the people of this country will face. Private shareholders will inevitably tell BT to concentrate on profitable routes. They will insist that profits and dividends are maximised. Although there have been some noises from the Conservative Benches about cross-subsidies, they will be strongly discouraged, with the result that emergency services and people in rural areas will suffer. The residential user will lose as a consequence of privatisation.
  The main adverse effect of privatisation will fall on residential customers. Conservative Members may shake their heads in disbelief, but that trend has already started. In November 1981 average bills for residential users were increased by twice as much as those for business users as a result of tariff increases. The July 1983 increases that have just been implemented show that that trend is continuing. The latest figures show a 3·2 per cent. increase for residential customers and only a 2·7 per cent. increase for business customers. That is the Government's philosophy. The Government are prejudiced against residential users, pensioners and poorer people. The Government are rebalancing the tariff structure against the people of this country.
  As a nationalised industry BT has important responsibilities to the community, especially to people with difficulties, the chronically sick and disabled. They will be lashed ruthlessly by a Government who have so little compassion. As a privatised company, BT will face the pressure of market forces. It will not have the time and money and, most importantly, it will not have the incentive to do anything for the people to whom I have referred.
  We believe it important to have a good telecommunications service for all rather than one that will be completely biased towards maximising profit and ripping off the people of this country.
  If the Government have less than a 50 per cent. holding in BT, they and therefore Parliament will lose the ability to influence the operation of the company. That is a significant threat to the public accountability of the company. I find it surprising that the Government have set profit levels and are forcing prices up to increase profit levels to finance their abortive economic strategy. We oppose the losing of public accountability and that is why we oppose the clauses.
  Mr. Timothy Wood: I must admit that last evening, when I heard who I regard as the odd job man of the Labour Benches, the hon. Member for Stoke-on-Trent, Central (Mr. Fisher), making one of his familiar three quarters of an hour contributions, I thought the prospect of catching your eye in that debate, Mr. Deputy Speaker, to be rather remote. I thank you for giving me that opportunity.
  5.45 pm
  The contrast between the approaches from the Government Benches and those from the Opposition were contained in the phrase "answerability to the state" used by the hon. Member for Blaydon (Mr. McWilliam). I believe, and I think most Conservative Members likewise believe, that management by Government and by Ministers is not the best way to run a large enterprise. When that is the position, all too often one is subjected to political interference at the expense of sound commercial
  1200
  judgment. It could be political interference of a delaying nature, hesitation while the various political lobbies put their case. In a fast moving world of information technology and telecommunications, such delays should not be accepted.
  Mr. Butcher: One of the lobby groups about which we have been concerned in this debate has been the pensions lobby. I should like to make it absolutely clear for the record that, when responding to a question about the total deficiency, I was referring to the total deficiency of £1·25 billion, which is the pre-1969 deficiency. I should like also to make it clear that any subsequent deficiency since 1969 must be met by BT or the Post Office in the usual way from current expenditure as the trust deed obliges them to do.
  Mr. Golding: On a point of order, Mr. Deputy Speaker. Would it not be better to adjourn the debate for the Under-Secretary of State to re-read his brief in case tomorrow another explanation is due and it is then too late?
  Mr. Deputy Speaker (Mr. Paul Dean): Order. The hon. Gentleman knows that that is a point of argument, not a point of order.
  Mr. Wood: That was yet another remark from the old suitcase that the hon. Member for Newcastle-under-Lyme (Mr. Golding) keeps for old speeches and for these occasions.
  Mr. Golding: I will send it to the other place.
  Mr. Wood: I can only commiserate with the other place.
  It is essential that we provide commercial freedom in information technology and telecommunications and the opportunity for commercial fund raising and commercial investment decision making. We have suffered too long from having political decision making and political constraints on when and where investment should be made. I believe that the denationalisation programme will provide the opportunity. Furthermore, I believe that it is nonsense to say that, because we have the nice sounding concept of "public service", that in itself means that customers get a good service. All too often that is not the case. There are not opportunities for choice. For too long we continued with the black telephones. We did not provide a choice for customers, whether domestic subscribers or commercial organisations. Already the liberalisation methods that have been undertaken have improved the position. There is no doubt in my mind that denationalisation and the freedom of competition will act very much to the benefit of the consumer.
  Mr David Penhaligon: Has the fundamental problem of British Telecom over the years been that it is run by the state or that it is a monopoly?
  Mr. Wood: It is a combination of the two. One follows from the other. If it is run by the state, it is a monopoly. I do not wish to see a monopoly, whether a state or privately run monopoly. We will initially have a duopoly for the major trunk networks. Within 20 years we shall see a vast change in the way in which telecommunication services are provided, with cellular radio links and other local networks. There will be major changes in provisions, not only for the domestic subscriber, but for advanced and necessary data networks.
  It will not do to say, as Opposition Members have said, that what has been satisfactory for the past 20, 30, 40 or

  1201
  50 years will be satisfactory in future. The position is changing too fast for that. I wish new companies to have the opportunity to get into the business. They will be successful because there is a rapidly growing market, and they will create good prospects for a better service for commercial and domestic users.
  Furthermore, I believe that the Government have provided protection in the Bill for the various minority groups, about which the Opposition have sung so long. I agree with their song, but their arguments are answered by the Bill's provisions. Some of their arguments were answered by clause 3, which Opposition Members sought to delete yesterday. I hope, therefore, that these clauses will not be deleted and that the Bill will be passed.
  Question put, That the amendment be made:—
  The House divided: Ayes 184, Noes 312.

  Division No. 107]

  [5.51 pm

  AYES

  Adams, Allen (Paisley N)

  Evans, loan (Cynon Valley)

  Alton, David

  Evans, John (St. Helens N)

  Ashdown, Paddy

  Fatchett, Derek

  Ashton, Joe

  Faulds, Andrew

  Atkinson, N. (Tottenham)

  Field, Frank (Birkenhead)

  Bagier, Gordon A. T.

  Fields, T. (L'pool Broad Gn)

  Barnett, Guy

  Fisher, Mark

  Barron, Kevin

  Flannery, Martin

  Beggs, Roy

  Foot, Rt Hon Michael

  Beith, A. J.

  Forsythe, Clifford (S Antrim)

  Bell, Stuart

  Foster, Derek

  Bennett, A. (Dent'n & Red'sh)

  Foulkes, George

  Bidwell, Sydney

  Fraser, J. (Norwood)

  Blair, Anthony

  Freeson, Rt Hon Reginald

  Boyes, Roland

  Freud, Clement

  Brown, Gordon (D'f'mline E)

  George, Bruce

  Brown, Hugh D. (Provan)

  Gilbert, Rt Hon Dr John

  Brown, R. (N'c'tle-u-Tyne N)

  Godman, Dr Norman

  Brown, Ron (E'burgh, Leith)

  Golding, John

  Bruce, Malcolm

  Gould, Bryan

  Caborn, Richard

  Hamilton, W. W. (Central Fife)

  Callaghan, Jim (Heyw'd & M)

  Hardy, Peter

  Campbell, Ian

  Harman, Ms Harriet

  Campbell-Savours, Dale

  Harrison, Rt Hon Walter

  Canavan, Dennis

  Hart, Rt Hon Dame Judith

  Carlile, Alexander (Montg'y)

  Haynes, Frank

  Carter-Jones, Lewis

  Healey, Rt Hon Denis

  Clark, Dr David (S Shields)

  Heffer, Eric S.

  Clarke, Thomas

  Hogg, N. (C'nauld & Kilsyth)

  Clay, Robert

  Home Robertson, John

  Cocks, Rt Hon M. (Bristol S.)

  Howell, Rt Hon D. (S'heath)

  Cohen, Harry

  Hoyle, Douglas

  Coleman, Donald

  Hughes, Mark (Durham)

  Concannon, Rt Hon J. D.

  Hughes, Robert (Aberdeen N)

  Conlan, Bernard

  Hughes, Roy (Newport East)

  Cook, Frank (Stockton North)

  Hughes, Sean (Knowsley S)

  Corbett, Robin

  Hughes, Simon (Southwark)

  Cowans, Harry

  Janner, Hon Greville

  Cox, Thomas (Tooting)

  John, Brynmor

  Craigen, J. M.

  Johnston, Russell

  Crowther, Stan

  Jones, Barry (Alyn & Deeside)

  Cunliffe, Lawrence

  Kennedy, Charles

  Cunningham, Dr John

  Kilroy-Silk, Robert

  Davies, Rt Hon Denzil (L'lli)

  Kinnock, Rt Hon Neil

  Davies, Ronald (Caerphilly)

  Kirkwood, Archibald

  Davis, Terry (B'ham, H'ge H'l)

  Lambie, David

  Deakins, Eric

  Lamond, James

  Dewar, Donald

  Leighton, Ronald

  Dixon, Donald

  Lewis, Ron (Carlisle)

  Dobson, Frank

  Lewis, Terence (Worsley)

  Dormand, Jack

  Litherland, Robert

  Douglas, Dick

  Lloyd, Tony (Stretford)

  Dubs, Alfred

  Loyden, Edward

  Duffy, A. E. P.

  McCartney, Hugh

  Dunwoody, Hon Mrs G.

  McCusker, Harold

  Eastham, Ken

  McDonald, Dr Oonagh

  Edwards, R. (W'hampt'n SE)

  McKay, Allen (Penistone)

  1202

  McKelvey, William

  Rogers, Allan

  Mackenzie, Rt Hon Gregor

  Rooker, J. W.

  McNamara, Kevin

  Ross, Ernest (Dundee W)

  McTaggart, Robert

  Ross, Stephen (Isle of Wight)

  Madden, Max

  Rowlands, Ted

  Maginnis, Ken

  Sedgemore, Brian

  Marek, Dr John

  Sheerman, Barry

  Martin, Michael

  Sheldon, Rt Hon R.

  Mason, Rt Hon Roy

  Shore, Rt Hon Peter

  Maxton, John

  Short, Ms Clare (Ladywood)

  Maynard, Miss Joan

  Skinner, Dennis

  Meacher, Michael

  Smith, C.(Isl'ton S & F'bury)

  Meadowcroft, Michael

  Smith, Rt Hon J. (M'kl'ds E)

  Michie, William

  Soley, Clive

  Mikardo, Ian

  Spearing, Nigel

  Millan, Rt Hon Bruce

  Steel, Rt Hon David

  Miller, Dr M. S. (E Kilbride)

  Stewart, Rt Hon D. (W Isles)

  Mitchell, Austin (G't Grimsby)

  Stott, Roger

  Molyneaux, Rt Hon James

  Straw, Jack

  Morris, Rt Hon A. (W'shawe)

  Thomas, Dafydd (Merioneth)

  Morris, Rt Hon J. (Aberavon)

  Thompson, J. (Wansbeck)

  Nellist, David

  Tinn, James

  Nicholson, J.

  Torney, Tom

  O'Neill, Martin

  Wallace, James

  Park, George

  Wardell, Gareth (Gower)

  Pendry, Tom

  Weetch, Ken

  Penhaligon, David

  Welsh, Michael

  Pike, Peter

  White, James

  Powell, Raymond (Ogmore)

  Wigley, Dafydd

  Radice, Giles

  Williams, Rt Hon A.

  Randall, Stuart

  Winnick, David

  Redmond, M.

  Woodall, Alec

  Richardson, Ms Jo

  Young, David (Bolton SE)

  Roberts, Allan (Bootle)

  Roberts, Ernest (Hackney N)

  Tellers for the Ayes:

  Robertson, George

  Mr. James Hamilton and

  Robinson, G. (Coventry NW)

  Mr. John McWilliam.

  NOES

  Aitken, Jonathan

  Butcher, John

  Alexander, Richard

  Butterfill, John

  Alison, Rt Hon Michael

  Carlisle, John (N Luton)

  Ancram, Michael

  Carlisle, Kenneth (Lincoln)

  Arnold, Tom

  Carttiss, Michael

  Ashby, David

  Chapman, Sydney

  Aspinwall, Jack

  Chope, Christopher

  Atkins, Rt Hon Sir H.

  Churchill, W. S.

  Atkins, Robert (South Ribble)

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

  Atkinson, David (B'm'th E)

  Clark, Dr Michael (Rochford)

  Baker, Kenneth (Mole Valley)

  Clark, Sir W. (Croydon S)

  Baker, Nicholas (N Dorset)

  Clarke Kenneth (Rushcliffe)

  Baldry, Anthony

  Clegg, Sir Walter

  Banks, Robert (Harrogate)

  Cockeram, Eric

  Batiste, Spencer

  Colvin, Michael

  Beaumont-Dark, Anthony

  Conway, Derek

  Bellingham, Henry

  Coombs, Simon

  Bendall, Vivian

  Cope, John

  Benyon, William

  Cormack, Patrick

  Berry, Sir Anthony

  Corrie, John

  Best, Keith

  Couchman, James

  Biffen, Rt Hon John

  Crouch, David

  Biggs-Davison, Sir John

  Currie, Mrs Edwina

  Bonsor, Sir Nicholas

  Dorrell, Stephen

  Bottomley, Peter

  Douglas-Hamilton, Lord J.

  Bowden, A. (Brighton K'to'n)

  Dover, Denshore

  Bowden, Gerald (Dulwich)

  du Cann, Rt Hon Edward

  Boyson, Dr Rhodes

  Dunn, Robert

  Braine, Sir Bernard

  Durant, Tony

  Brandon-Bravo, Martin

  Dykes, Hugh

  Bright, Graham

  Edwards, Rt Hon N. (P'broke)

  Brinton, Tim

  Emery, Sir Peter

  Brittan, Rt Hon Leon

  Evennett, David

  Brooke, Hon Peter

  Eyre, Reginald

  Brown, M. (Brigg & Cl'thpes)

  Fallon, Michael

  Browne, John

  Farr, John

  Bryan, Sir Paul

  Favell, Anthony

  Buchanan-Smith, Rt Hon A.

  Fenner, Mrs Peggy

  Buck, Sir Antony

  Fookes, Miss Janet

  Bulmer, Esmond

  Forman, Nigel

  Burt, Alistair

  Forsyth, Michael (Stirling)

  1203

  Fowler, Rt Hon Norman

  Lloyd, Ian (Havant)

  Fox, Marcus

  Lord, Michael

  Fraser, Rt Hon Sir Hugh

  Lyell, Nicholas

  Fraser, Peter (Angus East)

  McCrindle, Robert

  Freeman, Roger

  McCurley, Mrs Anna

  Fry, Peter

  MacGregor, John

  Gale, Roger

  MacKay, Andrew (Berkshire)

  Galley, Roy

  MacKay, John (Argyll & Bute)

  Gardner, Sir Edward (Fylde)

  Maclean, David John.

  Garel-Jones, Tristan

  Macmillan, Rt Hon M.

  Gilmour, Rt Hon Sir Ian

  McNair-Wilson, M. (N'bury)

  Glyn, Dr Alan

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

  Goodhart, Sir Philip

  McQuarrie, Albert

  Goodlad, Alastair

  Madel, David

  Gorst, John

  Major, John

  Gow, Ian

  Malins, Humfrey

  Gower, Sir Raymond

  Malone, Gerald

  Greenway, Harry

  Maples, John

  Gregory, Conal

  Marland, Paul

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

  Marlow, Antony

  Griffiths, Peter (Portsm'th N)

  Marshall, Michael (Arundel)

  Grist, Ian

  Mates, Michael

  Ground, Patrick

  Mather, Carol

  Grylls, Michael

  Maude, Francis

  Gummer, John Selwyn

  Mawhinney, Dr Brian

  Hamilton, Hon A. (Epsom)

  Maxwell-Hyslop, Robin

  Hamilton, Neil (Tatton)

  Mayhew, Sir Patrick

  Hampson, Dr Keith

  Mellor, David

  Hanley, Jeremy

  Merchant, Piers

  Hannam, John

  Miller, Hal (B'grove)

  Hargreaves, Kenneth

  Mills, Sir Peter (West Devon)

  Harvey, Robert

  Miscampbell, Norman

  Haselhurst, Alan

  Mitchell, David (NW Hants)

  Hawkins, C. (High Peak)

  Moate, Roger

  Hawkins, Sir Paul (SW N'folk)

  Monro, Sir Hector

  Hawksley, Warren

  Moore, John

  Hayhoe, Barney

  Morrison, Hon C. (Devizes)

  Hayward, Robert

  Morrison, Hon P. (Chester)

  Heathcoat-Amory, David

  Neale, Gerrard

  Heddle, John

  Nelson, Anthony

  Henderson, Barry

  Neubert, Michael

  Heseltine, Rt Hon Michael

  Newton, Tony

  Hickmet, Richard

  Nicholls, Patrick

  Hicks, Robert

  Norris, Steven

  Higgins, Rt Hon Terence L.

  Onslow, Cranley

  Hind, Kenneth

  Oppenheim, Philip

  Hirst, Michael

  Oppenheim, Rt Hon Mrs S.

  Hogg, Hon Douglas (Gr'th'm)

  Osborn, Sir John

  Holland, Sir Philip (Gedling)

  Page, John (Harrow W)

  Hooson, Tom

  Page, Richard (Herts SW)

  Hordern, Peter

  Parkinson, Rt Hon Cecil

  Howarth, Alan (Stratf'd-on-A)

  Parris, Matthew

  Howarth, Gerald (Cannock)

  Patten, Christopher (Bath)

  Howell, Rt Hon D. (G'ldford)

  Patten, John (Oxford)

  Hubbard-Miles, Peter

  Pattie, Geoffrey

  Hunter, Andrew

  Pawsey, James

  Hurd, Rt Hon Douglas

  Peacock, Mrs Elizabeth

  Irving, Charles

  Percival, Rt Hon Sir Ian

  Jessel, Toby

  Pollock, Alexander

  Johnson-Smith, Sir Geoffrey

  Porter, Barry

  Jones, Gwilym (Cardiff N)

  Powell, William (Corby)

  Jones, Robert (W Herts)

  Powley, John

  Jopling, Rt Hon Michael

  Prentice, Rt Hon Reg

  Joseph, Rt Hon Sir Keith

  Price, Sir David

  King, Roger (B'ham N'field)

  Prior, Rt Hon James

  Knight, Mrs Jill (Edgbaston)

  Proctor, K. Harvey

  Knowles, Michael

  Pym, Rt Hon Francis

  Knox, David

  Raison, Rt Hon Timothy

  Lang, Ian

  Rathbone, Tim

  Latham, Michael

  Rees, Rt Hon Peter (Dover)

  Lawler, Geoffrey

  Renton, Tim

  Lawrence, Ivan

  Ridley, Rt Hon Nicholas

  Lawson, Rt Hon Nigel

  Ridsdale, Sir Julian

  Lee, John (Pendle)

  Rifkind, Malcolm

  Leigh, Edward (Gainsbor'gh)

  Roe, Mrs Marion

  Lennox-Boyd, Hon Mark

  Rossi, Sir Hugh

  Lester, Jim

  Rost, Peter

  Lewis, Sir Kenneth (Stamf'd)

  Rowe, Andrew

  Lightbown, David

  Rumbold, Mrs Angela

  Lilley, Peter

  Ryder, Richard

  1204

  Sainsbury, Hon Timothy

  Thorne, Neil (Ilford S)

  Scott, Nicholas

  Thornton, Malcolm

  Shaw, Giles (Pudsey)

  Thurnham, Peter

  Shaw, Sir Michael (Scarb')

  Townend, John (Bridlington)

  Shelton, William (Streatham)

  Townsend, Cyril D. (B'heath)

  Shepherd, Colin (Hereford)

  Trippier, David

  Shersby, Michael

  Twinn, Dr Ian

  Silvester, Fred

  van Straubenzee, Sir W.

  Sims, Roger

  Vaughan, Dr Gerard

  Skeet, T. H. H.

  Viggers, Peter

  Smith, Sir Dudley (Warwick)

  Wakeham, Rt Hon John

  Smith, Tim (Beaconsfield)

  Walker, Bill (T'side N)

  Soames, Hon Nicholas

  Walker, Rt Hon P. (W'cester)

  Speed, Keith

  Wall, Sir Patrick

  Speller, Tony

  Waller, Gary

  Spence, John

  Walters, Dennis

  Spencer, D.

  Ward, John

  Spicer, Michael (S Worcs)

  Wardle, C. (Bexhill)

  Squire, Robin

  Warren, Kenneth

  Stanbrook, Ivor

  Watson, John

  Steen, Anthony

  Watts, John

  Stern, Michael

  Wells, Bowen (Hertford)

  Stevens, Lewis (Nuneaton)

  Wells, John (Maidstone)

  Stevens, Martin (Fulham)

  Wheeler, John

  Stewart, Allan (Eastwood)

  Whitney, Raymond

  Stewart, Andrew (Sherwood)

  Wilkinson, John

  Stewart, Ian (N Hertf'dshire)

  Winterton, Nicholas

  Stokes, John

  Wolfson, Mark

  Sumberg, David

  Wood, Timothy

  Tapsell, Peter

  Woodcock, Michael

  Taylor, Teddy (S'end E)

  Yeo, Tim

  Temple-Morris, Peter

  Young, Sir George (Acton)

  Terlezki, Stefan

  Younger, Rt Hon George

  Thatcher, Rt Hon Mrs M.

  Thomas, Rt Hon Peter

  Tellers for the Noes:

  Thompson, Donald (Calder V)

  Mr. Robert Boscawen and

  Thompson, Patrick (N'ich N)

  Mr. David Hunt.

  Question accordingly negatived.
  It being after Six o'clock, Mr. DEPUTY SPEAKER proceeded, pursuant to Order [21 November] and Resolution yesterday, to put forthwith the Questions necessary for the disposal of the business to be concluded at that hour.

Clause 56

  VESTING OF PROPERTY ETC. OF BRITISH TELECOMMUNICATIONS IN A COMPANY NOMINATED BY THE SECRETARY OF STATE
  Amendments made: No. 44, in page 51, line 15, leave out 'made by statutory instrument'.
  No. 45, in page 51, line 17, after 'liabilities', insert'
  (other than the expected liabilities'.
  No. 46, in page 51, line 22, at end insert—
  `(1 A) In this Act "the excepted liabilities" means the liabilities which subsist by virtue of a deed of covenant dated 22nd November 1978 and made between the Post Office and the then trustees of the Post Office Staff Superannuation Scheme.'.
  No. 47, in page 51, line 24, leave out 'made by statutory instrument'.—[Mr. Donald Thompson.]

Clause 57
  INITIAL GOVERNMENT HOLDING IN THE SUCCESSOR COMPANY
  Amendment made: No. 48, in page 52, line 14, leave out 'all'.[Mr. Donald Thompson.]
Clause 61

  TARGET INVESTMENT LIMIT FOR GOVERNMENT SHAREHOLDING
  Amendments made: No. 49, in page 55, line 27, leave out 'made by statutory instrument'.
  No. 50, in page 56, leave out lines 9 to 11.—[Mr. Donald Thompson.]

Clause 62

  FINANCIAL STRUCTURE OF THE SUCCESSOR COMPANY
  Amendment made: No. 51, in page 56, line 33, after 'liabilities', insert
  `(other than the excepted liabilities)'. — [Mr. Donald Thompson.]

Clause 65

  DISSOLUTION OF BRITISH TELECOMMUNICATIONS
  Amendments made, No. 52, in page 58, line 26, at end insert
  '; and the period of its continued existence after the transfer date is in this Act referred to as "the transitional period".'.
  No. 53, in page 58, line 27, leave out 'made by statutory instrument'.
  No. 54, in page 58, line 32, at end insert—
  '(3) Section 1(4) of the 1981 Act (composition of British Telecommunications) shall have effect during the transitional period as if for the word "six" there were substituted the word "one". '.—[Mr. Donald Thompson.]

Clause 67

  TAX PROVISIONS
  Amendment made: No. 55, in page 59, line 12, after `below', insert
  'and paragraph 38A of Schedule 5 to this Act'.—[Mr. Donald Thompson.]

Clause 81

  POWER OF SECRETARY OF STATE TO PROMOTE INTERESTS OF DISABLED PERSONS
  Amendments made: No. 57, in page 73, line 35, after `towards' insert `(a)'.
  No. 58, in page 73, line 37, at end insert
  `or

  (b) any fees incurred by any person in respect of the exercise in relation to apparatus to which this section applies of any function conferred by or under section 21 above.'. —[Mr. Butcher.]

  Mr. Alfred Morris: I beg to move amendment No. 56, in page 74, line 9, at end insert—
  '(3A) The results of all research financed under this section shall be set out by the Secretary of State in an annual report laid before both Houses of Parliament.'.
  Intervening from the Opposition Front Bench for the first time at this stage of the proceedings on a Bill that has
  1206
  been debated for more than 300 hours over a period of 13 months, I feel like an intruder on the last lap of an Olympic marathon. Happily, I am here by invitation, not as an intruder, and am delighted to join, even at this very late stage, the admirable team that has worked so tirelessly in opposing a Bill, the purpose of which is so strongly resented here and in the country.
  I have two prefatory points to make before turning to the amendment. First, I am extremely sorry that my hon. Friend the Member for Falkirk, East (Mr. Ewing), who has given such notable service and leadership as a member of the team, cannot be with us today because of his wife's illness. He is very much in cur thoughts and we feel deeply for him. Secondly, on a personal note, I naturally very much regret the absence from the Opposition Benches today of another former leading member of the team. I refer to my brother, the right hon. Charles Morris, who also gave stalwart service, based on his long experience and expertise in this field and who today is very widely and justifiably missed.
  The amendment is to clause 81, which gives the Secretary of State power to promote the interests of disabled people. It is an amendment prompted by the speech, of very considerable distinction, by my hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding) in Standing Committee on 1 December. As my hon. Friend said in his speech, legislating to help disabled people is no new endeavour for him. Indeed, his earliest experience of working on Committee here, very soon after his election to the House following the untimely death of Stephen Swingler, was as a most hard-working member of the Standing Committee on the Chronically Sick and Disabled Persons Bill, as it then was, between December 1969 and March 1970. Since then, as a Back Bencher, as a Minister and, more recently, as a Chairman of a Select Committee, my hon. Friend has been a well-informed, wholly genuine and at once skilful and successful campaigner to improve the well-being and status of disabled people.
  My hon. Friend was especially concerned in his speech of 1 December about the problems of the hearing impaired, whose number he estimated at 5 million. It is on their claim that I, too, will concentrate today. Nor is that in any way inappropriate since, as my hon. Friend recalled, Alexander Bell invented the telephone while attempting to help the hard of hearing, who included his own wife.
  To be hard of hearing very often means being lonely and isolated, and a telephone can be both a lifeline and a godsend. It can make all the difference between a full and fulfilling life and one of extreme dependence on other people. If they are not able to use telephones on the same terms as other people, the hard of hearing are denied equal opportunities in work and social life. Their mobility is restricted and their dignity is offended.
  The need is not merely for telephones in the homes of people who are hearing impaired, but for such people to be able to use all telephones on equal terms with everyone else. If there is any phone that normally hearing people can, and have the right to, use which is unusable by the hearing impaired, to that extent the hearing impaired are doubly handicapped and can suffer double despair.
  In reply to a parliamentary question on 2 December, I was told by the Minister that:
  "The Government are determined to ensure that disabled persons continue to be able to obtain telecommunications

  1207
  equipment adapted to their needs. We have included provisions in the Telecommunications Bill to achieve this, and the draft BT licence includes conditions specifically to safeguard the interests of disabled persons." —[Official Report, 2 December 1983; Vol. 49, c. 646.]
  The hearing impaired will derive only the minimum of comfort from that assurance. In fact, they will be extremely disappointed that the Government have not used the chance now available to them to ensure that modern technology improves not only the employment opportunities of people with hearing impairments, but their quality of life.
  The hard of hearing have for many years now been the victims, not the beneficiaries, of advancing technology in this subject. They alone in modern society have been left worse off by recent innovations.
  From the time of its invention until 1958, the telephone fortuitously produced sufficient magnetism to make it usable by people with hearing aids designed for its use. Some 80 per cent. of hearing aid users could enjoy freedom of movement in the pursuit of work and pleasure by being able, in common with normally hearing people, to use any telephone of their choice.
  The year 1958 saw a significant advance in technology. While it improved telecommunication for most of us, a vast number of hearing impaired people were denied use of the telephone. This was because of the replacement of the existing 300 type instrument by the incompatible 700 type. Millions of hearing impaired people were robbed by an advance in technology of the ability to make telephone calls that they had come to take for granted.
  It was only four years ago that British Telecom developed the inductive coupler, a cheap device which artificially restores the necessary magnetism to make it possible again for people with suitable hearing aids to use the telephone. The coupler, used on its own or in conjunction with an amplifying handset, has given new hope and confidence to the hearing impaired, even although the number of telephones with the couplers fitted is so limited. Imagine their disappointment and dismay, however, at the advent of a further, more recent technological so-called improvement. I refer to the new electronic telephones that cannot accept inductive couplers, amplifying handsets, or any of the other aids that can assist disabled people. The hearing impaired, both as individuals and through their organisations, made clear their indignation, and the Secretary of State was compelled to set up a working group to seek solutions to the problems.
  The problems will doubtless be solved in due course, but to what effect? Just around the corner lurks a new generation of telephones which will incorporate some even more advanced technology, namely, the ceramic and piezo-electric crystal receivers. These operate on such a low current that it will again be impossible to use inductive couplers and amplifying handsets. Once more, hearing impaired people will be the victims of technological advancement.
  This cruel cycle must be broken. A lasting solution must be found. It must be one which permits technological innovation, but not at the cost of further handicapping the hard of hearing. After all, what is the use of introducing phones that millions of people cannot use? That is not progress, but a way of mocking the plight of some of the most needful of our fellow citizens. The Government have
  1208
  a clear responsibility to ensure that all telephones can be used by people with hearing aids, and it is just not good enough to restrict their use on the grounds of cost or—and the technical case is often dubious—that inductive coupling could impede technological progress.
  If technological progress excludes millions of handicapped people from a lifeline service, then it is not progress. It makes no sense to claim that something is slightly better technologically if it denies the handicapped a service they so vitally need.
  The draft BT licence, by default, indicates the way out of the dilemma of trying to balance the claims of technological innovation with the needs of the hearing impaired. Condition 6 of the draft licence says a public emergency call service must be provided whereby any member of the public—I underline the word "any"—may at any time use the telephone to communicate with any of the emergency services as swiftly as practicable.
  In an emergency, the nearest telephone becomes a lifesaving facility. Any telephone can, at any time, become an emergency telephone. Yet the new incompatible telephones put the emergency services out of reach of the hearing impaired. So how can condition 6 possibly be met for the hard of hearing, in their millions? That is a question that the Minister must address himself to in reply to this debate tonight. I put it to him that the solution, as to most of the other telephone problems of the hard of hearing, is that from a not-too-distant future date, say three or four years, all new telephones supplied by BT must be capable of direct coupling to suitable hearing aids. That is, in my view, an inescapable necessity if condition 6 of the draft BT licence is not to become meaningless for millions of handicapped people. It is important also that, from the same date, every telephone provided by other suppliers, and connected to a publicly available network, should be capable of direct coupling to a suitable hearing aid. One way of achieving that would be to make a mandatory provision in the appropriate British Standard.
  6.15 pm
  There must be an on-going programme of research to serve three purposes, and Parliament must be kept informed of its progress. First, to solve the problems created by the introduction of electronic telephones, so that they are capable of accepting additions, such as loud bells, flashing lights, amplifying handsets, inductive couplers and other devices to suit the needs of hearing impaired and other disabled people. Secondly, to ensure that future generations of telephones are capable of meeting the needs of all disabled people, at least to the standard associated with the 700 type telephones. Our third purpose must be to provide a continuing programme of research into new apparatus to help the disabled generally, using the most up-to-date technology.
  This approach to the problem would restore to the hearing impaired the degree of telephonic mobility they enjoyed prior to 1958, would not impede technological progress and would ensure that the advantages of modern technology would be shared by all.
  The speech of my hon. Friend the Member for Newcastle-under-Lyme in Standing Committee was much informed, as he said, by the work of John Hart and Ron Collett, his Post Office Engineering Union colleagues, who have done so much to help the British Association for the Hard of Hearing. John Hart is a former chairman of the POEU's London regional council and, for many years, has

  1209
  combined an interest in the welfare of deaf people with research into the technical possibilities of alleviating their handicap by the use of the telephone. I honour him and Ron Collett for their advocacy of the proposals I am submitting to the House today, and am most grateful for all their assistance to me.
  I know they share my concern—I speak not only as the promoter of the Chronically Sick and Disabled Persons Act and a former Minister for the disabled, but also as president of the North of England Regional Association for the Deaf— that very much more needs to be done to help people who are completely deaf as well as the hard of hearing. Their problems are even more daunting and could, in many cases, be very substantially eased through telecommunication systems.
  Here is a further compelling reason why there should be an annual statement to Parliament about progress made by use of the power the Secretary of State is now seeking in clause 81. In the first such report, I hope it will be possible for him to prove that he is working to the three to four-year timetable I have proposed for all new telephones supplied by BT to be made capable of direct coupling to suitable hearing aids. At the same time, I trust that the report will give evidence of his commitment to the sympathetic hearing scheme. I am sure that all organisations of and for deaf people and the hard of hearing would be grateful if he could express his unequivocal support for it in this debate today.
  Our amendment does not seek an annual report to Parliament simply for the sake of recording what would have happened even without any legislative requirement of the kind that the amendment proposes. We want to excite progress, not merely to see it reported, and believe that our amendment will have that effect.
  Christmas is coming and I hope that the Minister will feel able to accept the amendment. It is put forward entirely without party animus as a means of helping millions of handicapped people who, like everyone else, want to be part of and not apart from society.
  Mr. Lewis Carter-Jones: Does my right hon. Friend recall that a similar amendment was incorporated in the then Chronically Sick and Disabled Persons Bill, which he promoted, and that there was no vote on it? It was accepted by both sides of the House without equivocation. Does my right hon. Friend hope that he will get the same response this evening?
  Mr. Morris: My hon. Friend is right to say that there were no party differences about the need to enact that section of my Chronically Sick and Disabled Persons Act. It was a moment in parliamentary history when both sides of both Houses of Parliament came together to seek agreed objectives that were widely supported all over the country. You especially will remember, Mr. Deputy Speaker, that there was no rancour whatever at any stage of the proceedings on my Bill. I hope very much that the Minister, when replying tonight, as my hon. Friend the Member for Eccles (Mr. Carter-Jones) was suggesting, will follow the lead that was given in the Session 1969–70. There is no case for rejecting our request for a progress report to this House on what is being done to promote the interests of the disabled.
  As the Minister will have noticed, there is no animus whatever in my approach today. If he feels that the drafting of the amendment could be more felicitous, we shall try
  1210
  to co-operate with him. I do very much hope that he will respond not only sympathetically, but constructively when he replies. I hope he will have learnt from the debates of 1969–70 that we never used the word "compassion". We decided, after consultation between the two sides of Parliament, that disabled people no longer wanted compassion. They want understanding. They want independence. They want respect. They want to be people who, as I have said, can be a part of and not apart from society. Above all, they reject condescension. I hope very much that the Minister will respond constructively to my appeal. I most warmly commend the amendment to the House.
  Mr. Butcher: I take the point of the right hon. Member for Manchester, Wythenshawe (Mr. Morris) that the last thing that the disabled want is condescension. They want to be seen as an integral part of our way of life and our society. I think that they would be the first pressure group to ask that they should not be picked out as a group requiring treatment which sets them apart from society. I am sure that they wish to be integrated within society as a whole and, therefore, we should set the measures that are introduced in this place in that light.
  The right hon. Member for Wythenshawe has graced our proceedings with his usual considerate manner and has made a number of astute observations, some of which I believe we can go some way towards satisfying in the Bill and in the licence. This is the third or fourth occasion on which we have debated the disabled while considering the Bill. We are trying through this proposed legislation to enshrine rights for the disabled that will meet their expectations of the telecommunications service, and it is our aim to do so in the most practical manner possible.
  About three or four issues which were raised in Committee concerning the disabled remain outstanding. I wish to reassure hon. Members, especially members of the Committee, that I have already taken up, in correspondence with Sir George Jefferson, the new questions which have been raised. I welcome this opportunity, therefore, to explain to the House a little more about the Government's policy on the needs of the disabled. I am talking about their need for telecommunications equipment and services. I shall try to answer some of the questions that have been asked. I may not be able to deal with some of them now because we have not yet formulated answers, but I hope that I shall be able to show how we are trying to find some of the key answers.
  We understand and appreciate the concern and needs of the disabled, including the visually handicapped, the hearing impaired and those handicapped in other ways. In a previous debate we explained that the licence refers to the disabled in the generality and in the particular in accordance with certain types of disability. There is presently available specially adapted telecommunications apparatus which enables the disabled to use the telephone. I know how important such apparatus is in the home and in places of work. I know also that there is concern that changes in technology will lead to difficulties in obtaining such equipment. I am aware of the concern that a more competitive industry will lead to difficulties in supplying apparatus for which there will, in some instances. always be a limited demand.
  The Government are determined that that will not be the result. We are determined to ensure that the disabled can continue to obtain telecommunications apparatus that is

  1211
  adapted to their needs. We have included provisions in the Bill to achieve this. There are also such provisions in the BT licence. I do not want to say too much now about the provisions of the Bill but I shall draw attention to clause 3. We have already spent some time discussing the clause, which sets the framework for many of the functions of the Secretary of State and the director, including the important licensing function.
  Clause 3(2)(a) imposes a specific duty upon the Secretary of State and the director to promote the interests of consumers, including those who are disabled, in respect of quality, variety and prices of telecommunications services and equipment. This duty provides the essential legislative safeguards for the disabled. Clause 81 empowers the Secretary of State, with the approval of the Treasury, to make grants for the purpose of supporting research into, or the development of, telephone communication apparatus that is designed for use by disabled persons. The clause provides a general enabling power. We intend that its primary purpose, at least initially, will be in the provision of telephone switchboards that are adapted for use by blind operators.
  There are two main adaptations for telephones which enable them to be used by the hard of hearing. This is a measure which has been focused on by the hon. Member for Newcastle-under-Lyme (Mr. Golding). The first adaptation is the incorporation into the earpiece of an inductive coupler, which enables those with hearing aids to use a telephone. The second is a built-in amplifier for those without hearing aids. There is concern that new technology will mean that such devices can no longer be put into new types of telephones. It seems that this problem has two main elements. The first problem is the immediate or short-term one, which is to ensure that telephones with these devices continue to be available.
  The second element is the long-term problem of how we are to make the new technological telephones usable by the hard of hearing. In the immediate future, I can give a firm assurance that telephones with internal inductive couplers and amplifiers will continue to be available. This assurance is given in condition 32 of the draft licence, which obliges BT to make available telephones which incorporate those devices. This will mean that the familiar series 700 telephone, which can be fitted with the inductive coupler, will continue to be available. There has been some anxiety that the series 700 telephone will be phased out and replaced by newer telephones such as the Statesman and the Viscount, which are now available and at present are not fitted with amplifiers. Some progress is being made towards adapting the Statesman and other phones so that they can be fitted with inductive couplers. I hope that this will be successful. In the meantime, condition 32 ensures that the 700 series will be available. Technology is moving fast.
  6.30 pm
  Mr. Alfred Morris: We all hope that further progress will be made. What will the procedure be for reporting that progress to the House? I hope that the Minister will take the point that an annual statement of progress would be extremely helpful.
  Mr. Butcher: I shall reply to that intervention in a moment.
  1212
  There is anxiety about whether the hard of hearing will be able to use the new phones. We are determined to ensure that they will be able to do so, but at present nobody knows what the solution will be. We have therefore appointed a working group of experts who will look into the technological problem with a view to establishing a research programme to find a solution.
  The new generation telephones need cause no immediate concern, because the old ones will be with us for some time. However, there is still concern that the present provision of those telephones is not wide enough. The working group will therefore also consider the present provision of products for hearing-impaired people to see how it can be maintained and, if possible, improved.
  As for the inclusion of inductive couplers in public call boxes, condition 33 requires BT to implement a programme of adapting all call boxes so that they can be used by the hard of hearing. BT has stated that this will be done by 1985. I have taken careful note of the comments made about that time scale, and I am asking BT either to bring the date forward or at least to give a firm assurance that there will be no slippage. I am also exploring the possibility of putting in kiosks a notice explaining to the hard of hearing how to use the call boxes with inductive couplers. Finally, I am also considering possible provisions in other licences which we may grant under the Bill, such as licences for branch systems. For instance, it might be possible to adapt emergency telephones in lifts for use by the hard of hearing.
  The hon. Gentleman did not refer at length to the blind and visually handicapped, but he will be aware that there is anxiety about the directory inquiries service. If BT introduced charges for directory inquiries, we would find a mechanism for ensuring that the blind did not pay. That point was made clearly in Committee, and I hope that it reassured the hon. Gentleman.
  We also want to ensure that blind people should continue to have employment opportunities in the telecommunications industry. There are some 1,200 blind telephonists; telephony is the major—though not the only—source of employment for the blind. They use private exchanges which are specially modified by replacing visual signals by tactile and sound signals. The Government want this valuable source of employment to be retained. We want to preserve existing job opportunities and, if possible, to create new ones.
  Technology is changing, and new models and types of private exchanges are coming on to the market. As far as possible, we want to ensure that these new models are so designed that they can be adapted for use by blind people. My Department has had very constructive discussions with the manufacturers and the Royal National Institute for the Blind, and there is general agreement in principle among all concerned that there should be a mandatory requirement that before an operator-controlled private branch exchange system is connected to the public network it should be shown to be adaptable for use by the blind. Much work has to be done in establishing what would be the essential features of such a requirement, and we hope to appoint a consultant specialist to do the work. This is a substantial step forward in safeguarding jobs for the blind, and I am sure that hon. Members on both sides of the House will welcome it.
  We are now seeing new PBXs coming on to the market. These are called distributed systems. There is no single designated operator position. Ideally, we would like them

  1213
  to be adaptable for use by the blind, but we do not know at present whether this is possible. We shall ask the consultant to look into that problem too.
  I have devoted some time to this topic but, as we have seen on previous occasions, we are all agreed that it is important.
  Amendment No. 56 seeks to require the Secretary of State to make an annual report to Parliament on the results of research financed by him under the clause. The amendment may not be necessary. The Secretary of State will, of course, be accountable to Parliament for his function under the clause just as he will be accountable for any of his other functions under the Bill. Hon. Members will be able to ask him questions about the finance for research, just as they will be able to question him about his licensing or approval functions. I see no reason to single out his clause 81 functions for inclusion in an annual report.
  Mr. Carter-Jones: Clause 81 is very important. It shows that the Government intend to provide research resources. It is to be welcomed.
  The Minister suggests relying upon parliamentary questions as a means of communicating what is being done, but he must realise that not many people read Hansard. There would be a double advantage in producing a report about research. Researchers would be made aware of what is being done, and we would avoid the wastage of money on research that had been done already. The report need only be a simple one, similar to that under section 22 of the Chronically Sick and Disabled Persons Act. A short report designed to prevent people from reinventing the wheel would save the Minister money.
  Mr. Butcher: I think that the hon. Gentleman may be underestimating the vigilance and vigour of the lobby in this House on behalf of the disabled. It is an all-party lobby and finds expression through one of the Select Committees. The hon. Gentleman might find, on consulting the annual report, that he could have referred to a report at much more frequent intervals. He could, for example, check the spending of the working party or of the consultants. He could increase the frequency of publication through our usual procedures.
  Our resistance to this well-intentioned amendment is founded on practicalities. It is not founded on any wish to withhold information—quite the contrary.
  Mr. Golding: The Minister's reply was disappointing. In the past, we have used a carrot and stick approach with him—carrots for what he has done for the disabled and stick for everything else. We shall have to give the Minister stick for his reply, because it was negative.
  Much research needs to be done. The Minister mentioned research for the benefit of the blind. That is important, but so is research for the benefit of the deaf as opposed to the hard of hearing. It should be possible, with the advance of technology and telecommunications systems, to provide deaf people, who are at the moment isolated, with visual means of communication. Such provision is important and should be achieved without additional cost to deaf people.
  I know that the Secretary of State wants users to pay the full cost of the services that they receive. The Opposition are keen on cross-subsidisation of services to the disabled. The Secretary of State might want people in wheelchairs to be able to get into a telephone kiosk without
  1214
  having to use a crowbar, and it is possible that he might want other subjects investigated, but it is certain that not much will be done unless, once a year, the Secretary of State has to set down what has happened. That is when we shall get action. It is only when civil servants suddenly see that they have a blank sheet of paper in front of them and nothing to write on it for the Secretary of State to present to Parliament that they will say, "We must get things moving."
  If we rely on parliamentary questions we shall only get the crowbar answers that the Secretary of State is likely to give. We want an annual report, because it will force the Secretary of State to take action on behalf of the disabled.. That is what we are speaking for—action. We shall not get such action unless the Secretary of State is forced to stand at the Dispatch Box with a report and account for himself.
  Mr. Alfred Morris: If the Minister is under instructions to resist the amendment, there is no point in pressing him to reconsider his stance. He conceded that the disabled had special problems and claims, and that is the reason for treating clause 81 differently from other parts of the Bill. Handicapped people deserve special help simply because they are handicapped. They have problems over and above those experienced by the generality of people.
  Of course, we can ask parliamentary questions. On this side of the House there are some expert practitioners in the art of asking parliamentary questions. I do not want to appear greedy, but we want to be able to ask parliamentary questions and to have an annual report as well. As my hon. Friend the Member for Eccles (Mr. Carter-Jones) wisely said, such a report will focus special attention on the problems of disabled people and the progress that the Government make in solving them in each and every year.
  6.45 pm
  If the Minister examines section 22 of the Chronically Sick and Disabled Persons Act 1970, he will find that the matters to which it relates are just as capable of being examined through parliamentary questions as those in clause 81. We decided as long ago as 1970 that there was a special case for reporting annually to Parliament on what had been done to improve the well-being of disabled people. Our amendment does not ask for an annual report simply for the sake of recording what would have happened without a legislative requirement such as we propose. I have already made that clear. We want to excite progress. I appeal to Ministers to reconsider their position. If they reject the amendment it will not disappear, but will return before the Bill reaches the statute book Notwithstanding what Ministers say today, the amendment will almost certainly be debated elsewhere and could well, I hope, become part of the Bill.
  Amendment negatived.

Clause 82

  POWER OF LOCAL AUTHORITIES TO CONTRIBUTE TOWARDS PROVISION OF FACILITIES
  Mr. Paddy Ashdown: I beg to move, in page 74, line 28, at end add—
  `(2A) Grants made by local authorities under subsections (1) and (2) above shall be exempted for the purposes of calculating local government overspending.'.

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  As the House knows, the Liberals, our colleagues in the Social Democratic party and others in the House have expressed considerable reservations about the general tenor of the Bill because it will not assure the continuation of the public service provision which we believe is necessary.
  I do not apologise for mentioning the problem of rural areas again—my hon. Friend the Member for Ross, Cromarty and Skye (Mr. Kennedy) did so eloquently last night. There are safeguards in the Bill and we recognise that they go some way towards solving some of the problems, but there is general anxiety about the survival of rural telephone boxes. I shall not deal with existing provision but, rather, will concentrate on that which might be provided in the future, especially the operation or laying of a cable system.
  I am sure that those who are more expert in this form of technology than I know that, although cable will come in on the back of the entertainment industry, it will make a profound impact on those who enjoy the new facilities. It will enable them to have special advantages in running businesses and creating employment. The same is true for cellular radio. There is a danger that there will be a division in the provision of new technology between those who have it and those who do not. When the provision of cable and cellular radio, for example, is discussed on purely commercial considerations, rural areas might well suffer significantly because the new technology is introduced late or because its provision in rural areas is not economically viable.
  I have a map which demonstrates British Telecom's considerations with regard to introducing cellular radio. It is significant that large areas of Britain, especially rural ones such as my constituency, are large holes in a map which otherwise shows adequate coverage. North Cornwall and parts of northern England are also represented as gaps on the map. We should be better off if we were able to question the distribution of such provision.
  The Government's proposals under clause 82 allow—and we welcome this—local authorities to intervene to secure that public service provision. To some extent this seems to be a tacit admission that the safeguards the Government have built in and lay so much emphasis on are rather less certain in their minds than they are in ours. That tacit admission of the inadequacy of the safeguards is reflected in the wording of clause 82. The wording says something positive, but under the current provision nothing is likely to be done.
  As we all know, with the significant power recently drawn away from local authorities by the operation of the rate-capping provision, and after the statement of the Secretary of State yesterday drawing the net even tighter round local government bodies, the capacity to intervene in a significant manner to ensure that those vital new provisions and existing provisions are safeguarded will be significantly limited, because local authorities will come up against the penalties of going over the top of their spending limits. If the Government mean what they say in clause 82, they would wish to see local authorities intervening to make good deficiencies in service that may occur in future. We wish to give local authorities the
  1216
  freedom which clause 82 claims to give them, but which we know does not exist because of the limitations placed on local government freedom and expenditure.
  The amendment seeks only to give real rather than rhetoric meaning to clause 82. I therefore urge the Government, even at this late hour, to recognise that need, as they have come some way towards recognising it, for the social provision of telecommunications and to accept the amendment which would undo a little of the damage which otherwise may be done by the rest of the Bill.
  Mr. Butcher: I should like to explain briefly what clause 82 does. It enables local authorities to contribute towards telecommunications facilities in their area. There is nothing new in this. It simply continues the present power of local authorities to contribute towards public call boxes in their areas. I stress that we are not looking to local authorities to make any substantial contribution towards the cost of providing call boxes. The primary responsibility for providing the call box network will rest with BT and it will be obliged to provide the existing network of call boxes, through a condition in its licence. The House has debated this matter on many occasions.
  The amendment is based on a slight misunderstanding of the position. I presume that the intention is to ensure that local authorities do not suffer grant withdrawal penalties on account of spending on call boxes. However, of the few contributions that are made, most come from the parish councils, which do not receive rate support grant anyway.
  Not only, therefore, is the amendment unnecessary, but in any case there already exist well-established procedures whereby any local authority that thinks that any specific item of expenditure should not count towards its spending total can make representations to my right hon. Friend the Secretary of State for the Environment.
  Mr. Ashdown: The Under-Secretary of State said that the majority of contributions will come from parish councils, but, as he well knows, that spending from parish councils is added on to the district council rate targets and will have a significant impact on that area of provision. Indeed, it will have a knock-on effect, because district council spending can be put over the rate limit, with the result that it will come under the rate-capping provisions like everything else.
  Mr. Butcher: It is for local authorities to determine their own priorities. It would be unfortunate if we started picking off various services which could be discounted against a rate support grant allocation.
  Therefore, the amendment is not acceptable.
  Mr. A. J. Beith: The Minister began to say something important. He seemed to say that the situation that arises under the Bill would bring about no more expenditure by local authorities in support of telecommunications facilities. He seemed to be genuinely of the view that there would be no new call on local authorities to support telephone boxes or other forms of telecommunications provision, even under the more commercial competitive atmosphere which he hopes will feature in telecommunications in future. I hope that that matter can be clarified by way of intervention if necessary.
  If the Minister genuinely believes that the Bill will not lead to a greater call on local authorities for any of the social provisions associated with the telephone industry,

  1217
  I think that he is saying something which nobody on this side of the House has believed from the beginning of the Bill to the end. The recent debates in the House underline the point. The concern expressed for the disabled, and earlier debates on various kinds of social provision, as well as the rural aspects, all presuppose that someone else will have to pay for some of the provisions traditionally provided by British Telecom.
  If the hon. Gentleman does not believe that there will be a greater call on local authorities, he must believe that the competitive atmosphere will have no effect on British Telecom, in which case he undermines the case for the Bill. Can he therefore clarify whether he thinks local authorities will not have any new calls made upon them?
  Question put, That the amendment be made: —
  The House divided: Ayes, 177, Noes, 310.

  Division No. 108]

  [6.55 pm

  AYES

  Adams, Allen (Paisley N)

  Evans, John (St. Helens N)

  Archer, Rt Hon Peter

  Fatchett, Derek

  Ashdown, Paddy

  Faulds, Andrew

  Ashton, Joe

  Field, Frank (Birkenhead)

  Atkinson, N. (Tottenham)

  Fields, T. (L'pool Broad Gn)

  Bagier, Gordon A. T.

  Fisher, Mark

  Banks, Tony (Newham NW)

  Flannery, Martin

  Barnett, Guy

  Forsythe, Clifford (S Antrim)

  Barron, Kevin

  Foster, Derek

  Beggs, Roy

  Foulkes, George

  Bell, Stuart

  Fraser, J. (Norwood)

  Bennett, A. (Dent'n & Red'sh)

  Freeson, Rt Hon Reginald

  Bidwell, Sydney

  Freud, Clement

  Blair, Anthony

  George, Bruce

  Boyes, Roland

  Gilbert, Rt Hon Dr John

  Brown, Gordon (D'f'mline E)

  Godman, Dr Norman

  Brown, Hugh D. (Provan)

  Golding, John

  Brown, R. (N'c'tle-u-Tyne N)

  Gould, Bryan

  Bruce, Malcolm

  Hamilton, James (M'well N)

  Caborn, Richard

  Hamilton, W. W. (Central Fife)

  Callaghan, Jim (Heyw'd & M)

  Hardy, Peter

  Campbell, Ian

  Harrison, Rt Hon Walter

  Campbell-Savours, Dale

  Hart, Rt Hon Dame Judith

  Canavan, Dennis

  Haynes, Frank

  Carlile, Alexander (Montg'y)

  Heffer, Eric S.

  Carter-Jones, Lewis

  Hogg, N. (C'nauld & Kilsyth)

  Clark, Dr David (S Shields)

  Home Robertson, John

  Clarke, Thomas

  Howells, Geraint

  Clay, Robert

  Hoyle, Douglas

  Cocks, Rt Hon M. (Bristol S.)

  Hughes, Mark (Durham)

  Cohen, Harry

  Hughes, Robert (Aberdeen N)

  Coleman, Donald

  Hughes, Roy (Newport East)

  Concannon, Rt Hon J. D.

  Hughes, Sean (Knowsley S)

  Conlan, Bernard

  Janner, Hon Greville

  Cook, Frank (Stockton North)

  John, Brynmor

  Cook, Robin F. (Livingston)

  Johnston, Russell

  Corbett, Robin

  Jones, Barry (Alyn & Deeside)

  Cowans, Harry

  Kennedy, Charles

  Cox, Thomas (Tooting)

  Kilroy-Silk, Robert

  Craigen, J. M.

  Kinnock, Rt Hon Neil

  Crowther, Stan

  Kirkwood, Archibald

  Cunliffe, Lawrence

  Lambie, David

  Cunningham, Dr John

  Lamond, James

  Davies, Ronald (Caerphilly)

  Lewis, Ron (Carlisle)

  Davis, Terry (B'ham, H'ge H'l)

  Lewis, Terence (Worsley)

  Deakins, Eric

  Litherland, Robert

  Dewar, Donald

  Lloyd, Tony (Stretford)

  Dixon, Donald

  Loyden, Edward

  Dobson, Frank

  McCartney, Hugh

  Dormand, Jack

  McCusker, Harold

  Douglas, Dick

  McKay, Allen (Penistone)

  Dubs, Alfred

  McKelvey, William

  Duffy, A. E. P.

  Mackenzie, Rt Hon Gregor

  Dunwoody, Hon Mrs G.

  McNamara, Kevin

  Eastham, Ken

  McTaggart, Robert

  Edwards, R. (Whampt'n SE)

  McWilliam, John

  Evans, loan (Cynon Valley)

  Madden, Max

  1218

  Maginnis, Ken

  Ross, Stephen (Isle of Wight)

  Marek, Dr John

  Ross, Wm. (Londonderry)

  Martin, Michael

  Sedgemore, Brian

  Mason, Rt Hon Roy

  Sheerman, Barry

  Maxton, John

  Sheldon, Rt Hon R.

  Maynard, Miss Joan

  Shore, Rt Hon Peter

  Meacher, Michael

  Short, Ms Clare (Ladywood)

  Meadowcroft, Michael

  Skinner, Dennis

  Michie, William

  Smith, C.(Isl'ton S & F'bury)

  Mikardo, Ian

  Smith, Rt Hon J. (M'kl'ds E)

  Millan, Rt Hon Bruce

  Soley, Clive

  Miller, Dr M. S. (E Kilbride)

  Spearing, Nigel

  Mitchell, Austin (G't Grimsby)

  Steel, Rt Hon David

  Molyneaux, Rt Hon James

  Stewart, Rt Hon D. (W Isles)

  Morris, Rt Hon A. (W'shawe)

  Stott, Roger

  Morris, Rt Hon J. (Aberavon)

  Straw, Jack

  Nellist, David

  Thomas, Dafydd (Merioneth)

  Nicholson, J.

  Thompson, J. (Wansbeck)

  O'Neill, Martin

  Tinn, James

  Park, George

  Torney, Tom

  Pendry, Tom

  Wardell, Gareth (Gower)

  Penhaligon, David

  Weetch, Ken

  Powell, Raymond (Ogmore)

  Welsh, Michael

  Radice, Giles

  White, James

  Randall, Stuart

  Wigley, Dafydd

  Redmond, M.

  Williams, Rt Hon A.

  Richardson, Ms Jo

  Winnick, David

  Roberts, Allan (Bootle)

  Woodall, Alec

  Roberts, Ernest (Hackney N)

  Young, David (Bolton SE)

  Robertson, George

  Robinson, G. (Coventry NW)

  Tellers for the Ayes:

  Rogers, Allan

  Mr. A. J. Beith and

  Rooker, J. W.

  Mr. James Wallace.

  Ross, Ernest (Dundee W)

  NOES

  Aitken, Jonathan

  Butterfill, John

  Alexander, Richard

  Carlisle, John (N Luton)

  Alison, Rt Hon Michael

  Carlisle, Kenneth (Lincoln)

  Amess, David

  Carttiss, Michael

  Ancram, Michael

  Chapman, Sydney

  Arnold, Tom

  Chope, Christopher

  Ashby, David

  Churchill, W. S.

  Aspinwall, Jack

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

  Atkins, Rt Hon Sir H.

  Clark, Dr Michael (Rochford)

  Atkins, Robert (South Ribble)

  Clark, Sir W. (Croydon S)

  Atkinson, David (B'm'th E)

  Clarke Kenneth (Rushcliffe)

  Baker, Kenneth (Mole Valley)

  Clegg, Sir Walter

  Baker, Nicholas (N Dorset)

  Cockeram, Eric

  Baldry, Anthony

  Colvin, Michael

  Banks, Robert (Harrogate)

  Conway, Derek

  Batiste, Spencer

  Coombs, Simon

  Beaumont-Dark, Anthony

  Cope, John

  Bellingham, Henry

  Cormack, Patrick

  Bendall, Vivian

  Corrie, John

  Benyon, William

  Couchman, James

  Berry, Sir Anthony

  Crouch, David

  Best, Keith

  Currie, Mrs Edwina

  Biffen, Rt Hon John

  Dorrell, Stephen

  Biggs-Davison, Sir John

  Douglas-Hamilton, Lord J.

  Bonsor, Sir Nicholas

  Dover, Denshore

  Bottomley, Peter

  du Cann, Rt Hon Edward

  Bowden, A. (Brighton K'to'n)

  Dunn, Robert

  Bowden, Gerald (Dulwich)

  Dykes, Hugh

  Boyson, Dr Rhodes

  Edwards, Rt Hon N. (P'broke)

  Braine, Sir Bernard

  Emery, Sir Peter

  Brandon-Bravo, Martin

  Evennett, David

  Bright, Graham

  Eyre, Reginald

  Brinton, Tim

  Fallon, Michael

  Brittan, Rt Hon Leon

  Farr, John

  Brooke, Hon Peter

  Favell, Anthony

  Brown, M. (Brigg & Cl'thpes)

  Fookes, Miss Janet

  Browne, John

  Forman, Nigel

  Bryan, Sir Paul

  Forsyth, Michael (Stirling)

  Buchanan-Smith, Rt Hon A.

  Fowler, Rt Hon Norman

  Buck, Sir Antony

  Fraser, Peter (Angus East)

  Bulmer, Esmond

  Freeman, Roger

  Burt, Alistair

  Fry, Peter

  Butcher, John

  Gale, Roger

  Butler, Hon Adam

  Galley, Roy

  1219

  Gardner, Sir Edward (Fylde)

  McNair-Wilson, M. (N'bury)

  Garel-Jones, Tristan

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

  Gilmour, Rt Hon Sir Ian

  McQuarrie, Albert

  Glyn, Dr Alan

  Madel, David

  Goodhart, Sir Philip

  Major, John

  Goodlad, Alastair

  Malins, Humfrey

  Gorst, John

  Malone, Gerald

  Gow, Ian

  Maples, John

  Gower, Sir Raymond

  Marland, Paul

  Greenway, Harry

  Marlow, Antony

  Gregory, Conal

  Marshall, Michael (Arundel)

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

  Mates, Michael

  Griffiths, Peter (Portsm'th N)

  Maude, Francis

  Grist, Ian

  Mawhinney, Dr Brian

  Ground, Patrick

  Maxwell-Hyslop, Robin

  Grylls, Michael

  Mayhew, Sir Patrick

  Gummer, John Selwyn

  Mellor, David

  Hamilton, Hon A. (Epsom)

  Merchant, Piers

  Hamilton, Neil (Tatton)

  Miller, Hal (B'grove)

  Hampson, Dr Keith

  Mills, Iain (Meriden)

  Hanley, Jeremy

  Mills, Sir Peter (West Devon)

  Hannam, John

  Miscampbell, Norman

  Hargreaves, Kenneth

  Mitchell, David (NW Hants)

  Harvey, Robert

  Moate, Roger

  Haselhurst, Alan

  Monro, Sir Hector

  Hawkins, C. (High Peak)

  Moore, John

  Hawkins, Sir Paul (SW N'folk)

  Morris, M. (N'hampton, S)

  Hawksley, Warren

  Morrison, Hon C. (Devizes)

  Hayhoe, Barney

  Morrison, Hon P. (Chester)

  Hayward, Robert

  Moynihan, Hon C.

  Heathcoat-Amory, David

  Mudd, David

  Heddle, John

  Neale, Gerrard

  Henderson, Barry

  Nelson, Anthony

  Hickmet, Richard

  Neubert, Michael

  Hicks, Robert

  Newton, Tony

  Higgins, Rt Hon Terence L.

  Nicholls, Patrick

  Hind, Kenneth

  Norris, Steven

  Hirst, Michael

  Onslow, Cranley

  Hogg, Hon Douglas (Gr'th'm)

  Oppenheim, Philip

  Holland, Sir Philip (Gedling)

  Oppenheim, Rt Hon Mrs S.

  Hooson, Tom

  Osborn, Sir John

  Hordern, Peter

  Page, John (Harrow W)

  Howarth, Alan (Stratf'd-on-A)

  Page, Richard (Herts SW)

  Howarth, Gerald (Cannock)

  Parkinson, Rt Hon Cecil

  Howell, Rt Hon D. (G'ldford)

  Parris, Matthew

  Hubbard-Miles, Peter

  Patten, Christopher (Bath)

  Hunt, David (Wirral)

  Patten, John (Oxford)

  Hunter, Andrew

  Pawsey, James

  Hurd, Rt Hon Douglas

  Peacock, Mrs Elizabeth

  Irving, Charles

  Pollock, Alexander

  Jessel, Toby

  Porter, Barry

  Johnson-Smith, Sir Geoffrey

  Powell, William (Corby)

  Jones, Gwilym (Cardiff N)

  Powley, John

  Jones, Robert (W Herts)

  Prentice, Rt Hon Reg

  Joseph, Rt Hon Sir Keith

  Price, Sir David

  Kershaw, Sir Anthony

  Proctor, K. Harvey

  King, Roger (B'ham N'field)

  Pym, Rt Hon Francis

  Knight, Mrs Jill (Edgbaston)

  Raison, Rt Hon Timothy

  Knowles, Michael

  Rees, Rt Hon Peter (Dover)

  Knox, David

  Ridley, Rt Hon Nicholas

  Lang, Ian

  Ridsdale, Sir Julian

  Latham, Michael

  Rifkind, Malcolm

  Lawler, Geoffrey

  Robinson, Mark (N'port W)

  Lawrence, Ivan

  Roe, Mrs Marion

  Leigh, Edward (Gainsbor'gh)

  Rossi, Sir Hugh

  Lennox-Boyd, Hon Mark

  Rost, Peter

  Lester, Jim

  Rowe, Andrew

  Lewis, Sir Kenneth (Stamf'd)

  Rumbold, Mrs Angela

  Lightbown, David

  Ryder, Richard

  Lilley, Peter

  Sainsbury, Hon Timothy

  Lloyd, Ian (Havant)

  Sayeed, Jonathan

  Lord, Michael

  Scott, Nicholas

  Lyell, Nicholas

  Shaw, Giles (Pudsey)

  McCrindle, Robert

  Shaw, Sir Michael (Scarb')

  McCurley, Mrs Anna

  Shelton, William (Streatham)

  MacGregor, John

  Shepherd, Colin (Hereford)

  MacKay, Andrew (Berkshire)

  Shersby, Michael

  MacKay, John (Argyll & Bute)

  Silvester, Fred

  Maclean, David John.

  Sims, Roger

  Macmillan, Rt Hon M.

  Skeet, T. H. H.

  1220

  Smith, Sir Dudley (Warwick)

  Trippier, David

  Smith, Tim (Beaconsfield)

  Twinn, Dr Ian

  Soames, Hon Nicholas

  van Straubenzee, Sir W.

  Speed, Keith

  Vaughan, Dr Gerard

  Speller, Tony

  Viggers, Peter

  Spence, John

  Wakeham, Rt Hon John

  Spencer, D.

  Walker, Bill (T'side N)

  Spicer, Michael (S Worcs)

  Walker, Rt Hon P. (W'cester)

  Squire, Robin

  Wall, Sir Patrick

  Stanbrook, Ivor

  Waller, Gary

  Steen, Anthony

  Walters, Dennis

  Stern, Michael

  Ward, John

  Stevens, Lewis (Nuneaton)

  Wardle, C. (Bexhill)

  Stevens, Martin (Fulham)

  Warren, Kenneth

  Stewart, Allan (Eastwood)

  Watson, John

  Stewart, Andrew (Sherwood)

  Watts, John

  Stewart, Ian (N Hertf'dshire)

  Wells, Bowen (Hertford)

  Stokes, John

  Wells, John (Maidstone)

  Sumberg, David

  Wheeler, John

  Tapsell, Peter

  Whitfield, John

  Taylor, Teddy (S'end E)

  Whitney, Raymond

  Tebbit, Rt Hon Norman

  Wilkinson, John

  Terlezki, Stefan

  Winterton, Nicholas

  Thatcher, Rt Hon Mrs M.

  Wolfson, Mark

  Thomas, Rt Hon Peter

  Wood, Timothy

  Thompson, Donald (Calder V)

  Woodcock, Michael

  Thompson, Patrick (N'ich N)

  Yeo, Tim

  Thorne, Neil (Ilford S)

  Young, Sir George (Acton)

  Thornton, Malcolm

  Younger, Rt Hon George

  Thurnham, Peter

  Townend, John (Bridlington)

  Tellers for the Noes:

  Townsend, Cyril D. (B'heath)

  Mr. Carol Mather and

  Tracey, Richard

  Mr. Robert Boscawen.

  Question accordingly negatived.
  7.7 pm
  It being after Seven o'clock, MR. DEPUTY SPEAKER proceeded, pursuant to Order [21 November] and the Resolution yesterday, to put forthwith the Questions necessary for the disposal of the business to be concluded at that hour.

Clause 86

  POWER OF DIRECTOR TO REQUIRE INFORMATION
  Amendment made: No. 59, in page 79, line 36, leave out '16' and insert
  `(Securing compliance with licence conditions)'.—[Mr. David Hunt]

Clause 91

  GENERAL INTERPRETATION
  Amendments made: No. 60, in page 82, line 2, at end insert
  'and "disabled" shall be construed accordingly'.
  No. 61, in page 82, line 2, at end insert
  '"the excepted liabilities" has the meaning given by section 56(1A) above;'.
  No. 62, in page 82, line 18, at end insert
  '"transitional period" has the meaning given by section 65(1) above'. —[Mr. David Hunt.]

Clause 94
  SHORT TITLE, COMMENCEMENT AND EXTENT
  Amendment made: No. 63, in page 84, line 43, leave out 'made by statutory instrument'.—[Mr. David Hunt.]
Schedule 2

  THE TELECOMMUNICATIONS CODE
  Amendments made: No. 64, in page 86, line 33, at end insert
  '''agriculture" and "agricultural"—

  (a) in England and Wales, have the same meanings as in the Highways Act 1980;

  (b) in Scotland, have the same meanings as in the Town and Country Planning (Scotland) Act 1972; and

  (c) in Northern Ireland, have the same meanings as in the Agriculture Act (Northern Ireland) 1949;'.

  No. 65, in page 86, line 35, at end insert
  "`bridleway" and "footpath"

  (a) in England and Wales, have the same meanings as in the Highways Act 1980;

  (b) in Scotland, have the same meanings as in Part III of the Countryside (Scotland) Act 1967; and

  (c) in Northern Ireland, mean a way over which the public have, by virtue of the Access to the Countryside (Northern Ireland) Order 1983, a right of way on horseback and on foot, respectively;'.

  No. 66, in page 87, leave out lines 12 and 13 and insert—
  '(a) except in Northern Ireland, means a maintainable highway within the meaning of the Public Utilities Street Works Act 1950 other than one which is a footpath or bridleway that crosses, and forms part of, any agricultural land or any land which is being brought into use for agriculture; and'.
  No. 68, in page 88, line 17, after 'agreement', insert `in writing'.
  No. 69, in page 88, line 35, after 'agreed', insert 'in writing'.
  No. 70, in page 88, line 37, leave out
  'the duty imposed by sub-paragraph (8) below'
  and insert
  'sub-paragraph (3A) and paragraph 3A below'.
  No. 71, in page 88, line 42, after 'agrees', insert 'in writing'.
  No. 72, in page 89, line 7, at end insert—
  '(3A) A right falling within sub-paragraph (1) above shall not have effect so as to authorise any telecommunications apparatus exceeding 15 metres in height to be installed, or kept installed, on or over any land unless the owners of the freehold estate in that land and every person who is (otherwise than as mortgagee) a lessee of the land is bound by an agreement that his interest in the land should be bound by the right.'.
  No. 73, in page 89, leave out lines 23 to 40.
  No. 74, in page 89, line 42, at end insert—
  `(i) in the application of this paragraph to any footpath or bridleway that crosses and forms part of any agricultural land or any land which is being brought into use for agriculture, as references to the occupier of that land;'.
  No. 75, in page 89, line 43, after 'street', insert
  '(not being such a footpath or bridleway)'.
  No. 76, in page 90, line 20, at end insert—
  `(10A) Subject to paragraphs 8(2) and 10(2) below, this paragraph shall not require any person to give his agreement to the exercise of any right conferred by any of paragraphs 8 to 11 below.'.
  No. 77, in page 90, line 30, after 'agreement', insert `in writing'.
  No. 78, in page 90, line 35, leave out from 'emergencies' to end of line 37.
  No. 79, in page 90, line 38 leave out '(2) to (8) and (10) of paragraph 2 above, and insert
  `(2) to (10) of paragraph 2 above except sub-paragraph (3A)'.
  No 80, in page 90, line 45 at end insert—
  'Effect of rights and compensation
  3A.—(1) Anything done by the operator in exercise of a right conferred in relation to any land in accordance with paragraph 2 or 3 above shall be deemed to be done in exercise of a statutory power.
  (2) Where at any time after something has been done in exercise of a right conferred in relation to any land in accordance with paragraph 2 or 3 above a person, being neither the person who conferred the right nor a person bound by the right by virtue of paragraph 2(3) above, becomes the occupier of the land, the operator shall restore the land to its condition before that thing was done.
  (3) The duty imposed by sub-paragraph (2) above shall, to the extent that its performance involves the removal of any telecommunication apparatus from any land, be enforceable only in accordance with paragraph 19 below.
  (4) Where—

  (a) on a right in relation to any land being conferred or varied in accordance with paragraph 2 or 3 above, there is a depreciation in the value of any relevant interest in the land, and

  (b) that depreciation is attributable to the fact that paragraph 19 below will apply to the removal from the land, when the owner for the time being of that interest becomes the occupier of theland, of any telecommunication apparatus installed in pursuance of that right, the operator shall pay compensation to the person who, at the time the right is conferred or, as the case may be, varied, is the owner of that relevant interest; and the amount of that compensation shall be equal (subject to paragraph 7(aa) below) to the amount of the depreciation.

  (5) In subparagraph (4) above "relevant interest", in relation to land subject to a right conferred or varied in accordance with paragraph 2 or 3 above, means any interest in respect of which the following two conditions are satisfied at the time the right is conferred or varied namely—

  (a) the owner of the interest is not the occupier of the land but may become the occupier of the land by virtue of that interest; and

  (b) the interest is not the interest of a person who gave his agreement to the conferring or variation of the right or of a person who is bound by the right or variation by virtue of paragraph 2(3) above.

  (6) Any question as to a person's entitlement to compensation under sub-paragraph (4) above, or as to the amount of any compensation under that sub-paragraph, shall in default of agreement, be referred to and determined by the Lands Tribunal.
  (7) A claim to compensation under sub-paragraph (4) above shall be capable of being made at any time before the owner of the interest in respect of which the claim is made becomes the occupier of the land in question, or at any time in the period of three years beginning with that time.
  (8) For the purposes of assessing any compensation under sub-paragraph (4) above, rules (2) to (4) set out in section 5 of the Land Compensation Act 1961 shall, subject to any necessary modifications, have effect as they have effect for the purposes of assessing compensation for the compulsory acquisition of any interest in land.
  (9) Subsections (1) to (3) of section 10 of the Land Compensation Act 1973 (compensation in respect of mortgages, trusts for sale and settled land) shall apply in relation to compensation under Part I of that Act.
  (10) In the application of this paragraph to Northern Ireland—

  (a) for the reference in sub-paragraph (6) above to the Lands Tribunal there is substituted a reference to the Lands Tribunal for Northern Ireland;

  (b) for the reference in sub-paragraph (8) above to section 5 of the Land Compensation Act 1961 there is substituted a reference to Article 6 of the Land Compensation (Northern Ireland) Order 1982;

  (c) for the references in sub-paragraph (9) above to subsections (1) to (3) of section 10 of the Land

  1223
  Compensation Act 1973 and to Part I of that Act there are substituted references to paragraphs (1) to (3) of Article 13 of the Land Acquisition and Compensation (Northern Ireland) Order 1973 and to Part II of that Order, respectively.'.

  No. 82, in page 91, line 25 at end insert—
  '(4A) The terms and conditions specified by virtue of subparagraph (4) above in an order under this paragraph, shall include such terms and conditions as appear to the court appropriate for ensuring that the least possible loss and damage is caused by the exercise of the right in respect of which the order is made.'.
  No. 83, in page 92, leave out lines 1 to 12 and insert—
  `Court to fix financial terms where agreement dispensed with]
  5.—(1) The terms and conditions specified by virtue of sub-paragraph (4) of paragraph 4 above in an order under that paragraph dispensing with the need for a person's agreement, shall include—

  (a) such terms with respect to the payment of consideration in respect of the giving of the agreement, or the exercise of the rights to which the agreement relates, as it appears to the court would have been fair and reasonable if the agreement had been given willingly and subject to the other provisions of the order; and

  (b) such terms as appear to the court appropriate for ensuring that persons from time to time bound by the order are adequately compensated (whether by the payment of such consideration or otherwise) for any loss or damage suffered by them in consequence of the exercise of the rights to which the agreement relates.

  (1A) In determining what amount should be specified in a term of an order under paragraph 4 above requiring a payment to be made to any person, the court shall, in a case where the order is made in consequence of an application made in connection with proceedings under paragraph 19 below, take into account, to such extent as it thinks fit, any period during which that person was entitled to require the removal of any telecommunication apparatus from the land in question but, by virtue of paragraph 19 below, was not entitled to enforce its removal; but where the court takes any such period into account, it may also take into account any compensation paid under paragraph 3A(4) above.
  (1B) The terms specified by virtue of sub-paragraph (1) above in an order under paragraph 4 above may provide—

  (a) for the making of payments from time to time to such persons as may be determined under those terms; and

  (b) for questions arising in consequence of thse terms (whether as to the amount of any loss or damage caused by the exercise of a right or othewise) to be referred to arbitration or to be determined in such other manner as may be specified in the order.'.

  No. 84, in page 92, line 14, leave out
  `in pursuance of sub-paragraph (1) above'
  and insert
  `by virtue of terms specified in an order under paragraph 4 above'.
  No. 85, in page 92, line 21, leave out
  `by virtue of sub-paragraph (1) above the court requires'
  and insert
  `terms specified in an order under paragraph 4 above require'.
  No. 86, in page 92, leave out lines 24 to 30.
  No. 87, in page 93, line 28, at end insert—
  `(aa) confer any right to compensation under any provision of this code on any person, or'.
  No. 88, in page 94, line 7 [Schedule 2], leave out `nothing in this paragraph shall authorise the doing of anything'
  and insert
  'the rights conferred by this paragraph shall not be exercisable'.
  No. 89, in page 94, line 20, leave out
  '(without obtaining any agreement required by paragraph 2 above)'.
  No. 90, in page 96, line 17 leave out
  `(without obtaining any agreement required by paragraph 2 or 3 above)'.
  No. 91, in page 98, line 13, leave out
  'damage or disturbance caused to that person by'
  and insert
  `loss or damage suffered by that person in consequence of the carrying out of.
  No. 92, in page 98, line 25, leave out 'damage' and insert 'loss'.
  No. 93, in page 98, line 29, leave out from 'had' to 'on' in line 31 and insert
  'given his authority willingly for the works to be executed'.
  No. 94, in page 99, line 48, at end insert—
  'Compensation for injurious affection to neighbouring land etc.
  14A—(1) Where a right conferred by or in accordance with any of the preceding provisions of this code is exercised, compensation shall be payable by the operator under section 10 of the Compulsory Purchase Act 1965 (compensation for injurious affection to neighbouring land etc.) as if that section had effect in relation to injury caused by the exercise of such a right as it has effect in relation to injury caused by the execution of works on land that has been compulsorily purchased.
  (2) Sub-paragraph (1) above shall not confer any entitlement to compensation on any person in respect of the exercise of a right conferred in accordance with paragraph 2 or 3 above, if that person conferred the right or is bound by it by virtue of paragraph 2(3) above, but, save as aforesaid, the entitlement of any person to compensation under this paragraph shall be determined irrespective of his ownership of any interest in the land where the right is exercised.
  (3) Compensation shall not be payable on any claim for compensation under this paragraph unless the amount of the compensation exceeds £50.
  (4) In the application of this paragraph to Northern Ireland—

  (a) for any reference in sub-paragraph (1) to section 10 of the Compulsory Purchase Act 1965 there is substituted a reference to Article 18 of the Land Compensation (Northern Ireland) Order 1982;

  (b) any question as to a person's entitlement to compensation by virtue of sub-paragraph (1) above, or as to the amount of that compensation, shall, in default of agreement, be determined by the Lands Tribunal for Northern Ireland.'.

  No. 95, in page 100, line 20, at end insert—
  '(3A) Where a person has both given a notice under this paragraph and applied for compensation under any of the preceding provisions of this code, the court

  (a) may give such directions as it thinks fit for ensuring that no compensation is paid until any proceedings under this paragraph have been disposed of, and

  (b) if the court makes an order under this paragraph, may provide in that order for some or all of the compensation otherwise payable under this code to that person not to be so payable, or, if the case so requires, for some or all of any compensation paid under this code to that person to be repaid to the operator.'.

  No. 96, in page 101, line 26, leave out from 'apparatus' to end of line 29 and insert
  'the court shall have the same powers as it would have if an application had been duly made under paragraph 4 above for an order dispensing with the need for that person's agreement.'
  No. 97, in page 103, line 1, leave out 'may' and insert `shall'.
  No. 98, in page 103, line 43, leave out from, `apparatus' to end of line 46 and insert
  'the court shall have the same powers as it would have if an application had been duly made under paragraph 4 above for an order dispensing with the need for that person's agreement.'.
  No. 99, in page 105, line 30 [Schedule 2], after 'paragraph', insert
  'and without prejudice to paragraph 5(1A) above'.
  No. 100, in page 105, line 34, leave out from 'time' to end of line 39.
  No. 101, in page 110, line 24, at end insert—
  '(2A) Except as provided under the preceding provisions of this code, the operator shall not be liable to compensate any

  1225
  person for, or be subject to any other liability in respect of, any loss or damage caused by the lawful exercise of any right conferred by or in accordance with this code.'.
  No. 102, in page 111, line 13, leave out 'by the court' and insert
  'after the coming into force of this code in like manner as if this Act had not been passed.

  (4A) A person shall not be entitled to compensation under any provision of this code if he is entitled to compensation in respect of the same matter by virtue of sub-paragraph (4) above.'.—[Mr. David Hunt.]

Schedule 5

  GENERAL TRANSITIONAL PROVISIONS AND SAVINGS
  Amendments made:
  No. 103, in page 181, line 34, at end insert—
  '(2) Nothing in sub-paragraph (1) above shall be taken as applying in relation to the deed of covenant by virtue of which the excepted liabilities subsist.'.
  No. 104, in page 182, line 3, at end insert—
  '(2) Nothing in sub-paragraph (1) above shall be taken as applying in relation to the excepted liabilities or to the deed of covenant by virtue of which those liabilities subsist.'.
  No. 114, in page 18, line 9, leave out `of British Telecommunications'.
  No. 15, in page 182, line 13, leave out 'of British Telecommunications.'
  No. 116, in page 182, leave out lines 22 and 23 and insert
  `foreign property, right or liability'.
  No. 117, in page 182, line 31 after 'any', insert `foreign'.
  No. 118, in page 182, line 35 leave out 'section' and insert `paragraph'.
  No. 119, in page 182, line 36, leave out `of British Telecommunications'.
  No. 120, in page 182, line 37, leave out `of British Telecommunications'.
  No. 105, in page 182 leave out lines 42 to 45.
  No. 106, in page 182, line 46 leave out 'in performing its duty'.
  No. 107, in page 182, line 48 at end insert—
  '38A.—(1) During the transitional period it shall be the duty of British Telecommunications to discharge the excepted liabilities as they fall to be discharged.
  (2) Subject to sub-paragraph (3) below, the excepted liabilities shall be discharged, and any expenses incurred by British Telecommunications under this paragraph shall be met, out of sums received by British Telecommunications in right of or on the disposal of such debentures of the successor company as the Secretary of State, with the approval of the Treasury, may transfer to British Telecommunications (in this paragraph referred to as "the transferred debentures").
  (3) British Telecommunications may not dispose of any of the transferred debentures without the consent of the Secretary of State given with the approval of the Treasury.
  (4) Where so much of any sums so received as is held by British Telecommunications on any day exceeds the aggregate for that day of—

  (a) any excepted liability falling to be discharged; and

  (b) any expenses falling to be met under this paragraph, the excess shall be applied by British Telecommunications in such manner as the Secretary of State, with the approval of the Treasury, may direct; and a direction under this subparagraph may require the whole or any part of the excess to be paid into the Consolidated Fund.

  (5) Where so much of any sums so received as is held by British Telecommunications on any day falls short of the aggregate for that day of—

  (a) any excepted liability falling to be discharged; and

  (b) any expenses falling to be met under this paragraph, the deficiency shall he made good by the Secretary of State out of money provided by Parliament.

  No. 108, in page 183, line 15 leave out 'in performing its duty'.
  No. 109, in page 183, line 41 at end add
  `or to any records kept by British Telecommunications for the purposes of paragraph 38A above'.
  No. 110, in page 185, line 30 after "liabilities', insert
  `(other than the excepted liabilities)'.
  No. 111, in page 186, line 16 at end insert—
  securities" has the same meaning as in Part V of this Act.'.—[Mr. David Hunt.]

  TITLE
  Amendment made:
  No. 112, in line 9, leave out `all'.—[Mr. David Hunt.]
  Order for Third Reading read.
  [Queen's consent, on behalf of the Crown, and Prince of Wales's consent signified.]
  7.8 pm
  The Secretary of State for Trade and Industry (Mr. Norman Tebbit): I beg to move, That the Bill be now read the Third time.
  This is one of the most discussed measures ever to come before the House. I pay tribute to the Stakhanovite workers of the successive Committees; they indeed established some records. They may in some ways have been unenviable ones, but at feast they were records. Particularly I pay tribute to my hon. Friend the Minister for Information Technology for the extraordinary work that he put in, together with my hon. Friend the Under-Secretary of State.
  During the first time round the course the Bill received a Second Reading, 161½ hours in Committee and two days on Report and Third Reading. That was in 1982 and in early 1983. On the second time around, after the temporary interruption of the election—at which our policies were endorsed—the Bill had a Second Reading, 111½hours in Committee and a further two days on Report and Third Reading. No claim that the opportunity for debate has been inadequate can carry any conviction. On the other hand, it would be hard to claim that the opportunity for discussion was well taken, not because of any restrictions by the Government, but because of the attitudes that were adopted by the Opposition. In Committee the Opposition determinedly and repeatedly avoided debate on most of the important issues at stake and, as a result, some cases of trivia were accorded more time than some of the important issues. Although there was discussion on some important matters, they were not necessarily the central issues.
  The concentration of discussion on time-consuming and peripheral matters has not been accidental. The Bill has been the subject of a campaign of deliberate misinformation and of advertisements deliberately aimed at arousing needless and groundless anxiety. That is regrettable, but the price of free speech is that it is available even to those who wish to distort or reverse the truth. When such a campaign relies so heavily upon statements which even those making them most know to be untrue, we can be sure that the campaigners have a bad case. When they resort to the arguments of industrial action, it is certain that they know that they have lost the intellectual arguments, particularly when, as in this case, the issue has been decided at a general election.
  An even more unsavoury aspect of some of the lobbying has been the widespread use of British Telecom's

  1227
  official paid envelopes by BT employees who have sent lobbying materials through the post. My office has received representations in that way from no fewer than 130 lobbyists. Although I read that the Post Office Engineering Union is concerned to protect the consumer, that misappropriation of BT's property—in effect, the customer's cash — makes it all the more difficult to believe. It casts an illuminating and unflattering light on the tactics and standards of some of those in the POEU who have organised that campaign. I am glad that the industrial action has ended. The POEU has instructed its members to work normally, and that is a good and sensible thing.
  On this occasion I should like to review the Bill, set it in the framework or our economic policy, deal with some specific points and describe the opportunities that it opens for BT, its customers and its employees.
  First, I refer to the Bill in relation to our general economic policy. The Government believe that industry and commerce exist to serve their customers, not the other way round. Wherever possible, the customer should be king and free to choose what he or she wants. The element of choice is the basic freedom that separates West from East and has for many years separated the more successful economies of choice and competition from the more spectacular failures marked by centralised planning and direction.
  We seek to widen areas of choice wherever we can so that more people can be more free to choose where they live and where they travel, what they think and what they say, and bear responsibility for their choices. Those choices are fundamental freedoms which are vital even though economic choices are bound to be limited by economic factors.
  Absence of choice is bad for the customer. If someone else decides what we may and may not buy with our money, we are placed in an economic prison. Absence of choice is bad for the manufacturers, it stultifies innovation, perpetuates poor management and leads in the long run to industrial decline. It is bad for those who provide services who can escape with poor quality or use resources wastefully. In sum, absence of choice is bad for the country since it leads to dissatisfied consumers, inefficient manufacturers incapable of competing in world markets and dozy and stagnant provision of service.
  The basic aim of the Telecommunications Bill is to give more choice to people when they use telecommunications. Our choice tonight is whether we should give the people the choice or reserve it for the functionnaires and the bureaucrats.
  In 1979 the Government inherited a monopoly industry running both post and telecommunications. There was almost no choice. People received only the service which the Post Office decided they wanted, only when it decided people could have it, often irrespective of what people wanted or when the service was wanted. There was widespread complaint about the service in normal times, and those criticisms were aggravated by the demonstration of monopoly labour power by the POEU, which took industrial action in 1978 to stop the connection of new equipment.
  Telecommunications—so central to the industrial life of a mature economy like that of the United Kingdom—was faced with a stranglehold. The circumstances were not
  1228
  by any means all black. Much that the Post Office did was excellent. We had nationwide subscriber trunk dialling and international direct dialling. However, the advantages were more than outweighed by the problems of poor service, delay, lack of innovation and poor value for money. A root cause was clear—monopoly. A single, centralised, nationalised, monopoly organisation took all the decisions, and a monopolistic union underpinned it. There was an absence of choice.
  The Government's first step was the British Telecommunications Act 1981 which separated the Post Office and British Telecom. An incidental, but noteworthy, result has been the impressive way in which the Post Office, given more coherent objectives, has performed since the two bodies were separated.
  The 1981 Act made the first steps towards giving customers choice in three areas. First, customers are now beginning to get the opportunity to choose the telecommunications equipment that they buy for office and home. By the end of 1987 there will be a completely free market for approved apparatus.
  Secondly, customers are now being given the choice of the services that they can receive over their telephone lines. The increasing coming together of computing and telecommunications will provide value added network services of a wide variety offering choices hitherto unheard of.
  Thirdly, customers will be given a choice of the telecommunications network into which they can connect. We have already taken major steps in this direction through the licensing of Mercury and the two cellular networks, and we are about to license local cable systems. In all those areas the Government are making a steady and significant change.
  Above all, the transition from the traditions of a Civil Service inheritance to modern management systems, accounting and the attitudes required for present and future business is a huge task, and it cannot be accomplished overnight; nor are the sums involved anything other than huge. Many hundreds of millions of pounds, spread over years of planning and implementation, will be invested in British Telecom and its rivals. We are talking of systems of great complexity. BT and Mercury are part of an international telephone network which together comprise what can be argued to be the largest single machine on earth. It is proper, therefore, that our progress should be paced to match the scale of the task.
  Once opened, the gates of consumer choice will remain open and there can be no turning back. Already with the door ajar, but not yet fully open, customers are seeing the benefits.
  Mr. Roger Stott: Those gates on privatisation can be closed.
  Mr. Tebbit: The hon. Gentleman says that those gates can be closed, but I assure him that he would be unwise to try to do so because he would fail spectacularly, as he failed last May and June.
  Millions of pounds have been committed to developing new apparatus, services and systems. I believe that the liberalisation of BT will have a significant effect upon our country, as did the liberalisation of broadcasting when the stranglehold of the BBC was removed. I am sure that the hon. Member for Wigan (Mr. Stott) was against that as well.
  Mr. Stott: I was too young.
  Mr. Tebbit: The hon. Gentleman may grow old enough to be wise. It is a remote hope, but if he gets very old he may.
  Lastly, I remind my hon. Friends that we have already made significant progress. This Government have already taken liberalisation in telecommunications further than any other Government. We have been the first to license a nationwide alternative telecommunications network with international access. We were the first in the world to license two competing cellular networks with nearly total national coverage. We were the first in Europe to establish independent standards and approvals arrangements. Today we are already the country with the most liberal arrangements for value added network services in the world.
  I recognise the complaints of some of my hon. Friends that we have done too little, or that we are moving too slowly, but I ask them to consider the fact, which I believe to be proven, that we have done more to change the regulatory environment in the past 26 months than the Americans have done in the 15 years since the Carterphone decision.
  The 1981 Act played its part in liberalising the industry, but it was not sufficient on its own. In particular, it left three major areas for further action. First, it did not reform the general law as it affected telecommunications. For example, it left in BT's hands the power to license operators to use the Telegraph Acts to place apparatus on streets and private land. It did not reform the Telegraph Acts themselves, which the Law Commission has described as a blot on the statute book, and it did little to amend planning and other laws to accommodate competing operators. The licensing of Mercury and the work done by the Mercury team have also revealed a host of legal, commercial, planning, taxation and technical problems which were not anticipated when the BT Bill was drafted.
  The Bill, and especially the telecommunications code in schedule 2, reform the law to meet the changed circumstances of competition, but the Opposition decided not to debate the code or the substantial amendments made to it earlier today. The code will, of course, receive close attention in the other place, but I should like to explain to the House why we have thought it necessary to make these changes and the amendments to schedule 2. They illustrate our responsiveness to constructive criticism of our proposals, although I regret that those constructive criticisms were not made during the debates.
  Mr. Stott: We were debating clause 3.
  Mr. Tebbit: The debate on clause 3 went on for some time. It might have been better if the Opposition had been prepared to move on to other parts of the Bill.
  I wish to describe one particular aspect of the detailed changes. As many hon. Members will know, the Royal Institution of Chartered Surveyors drew attention to the compensation provisions of the telecommunications code, which it regarded as inadequate. In a carefully prepared memorandum, it explained how the Bill as introduced failed to provide for compensation to be paid for certain types of loss or damage which may occur when a telecommunications operator is given the right to install apparatus. Our amendments attempt to meet those valid
  1230
  concerns, so that even without the Opposition playing any constructive role we have shown ourselves ready to meet sensible argument.
  In relation to compensation, we have set out to do three things. The first is to clarify and strengthen the arrangements for compensation when the court, having had regard to the principle that no one should unreasonably be denied access to a telecommunications system, decides that an operator should be given the right to install apparatus on private land against the wishes of a landlord or tenant.
  The second is to ensure that a person whose agreement was not sought by an operator before apparatus is installed on land in which he has an interest can obtain compensation for any diminution in the market value of his land, which might arise because of doubts about his ability to secure the removal of the apparatus when he comes into possession of the land. The third is to provide for compensation when someone with an interest in neighbouring land suffers loss or damage as a result of the installation of telecommunication apparatus. We hope that the amendments meet the concern that the RICS has explained to us.
  We could not, however, accept the objections of the RICS to the principle that occupiers alone should be able to agree to the installation of telephone wires and other apparatus on rented property without obtaining the consent of their landlords. That concern was reflected in the amendments in the name of my hon. Friend the Member for Hertford and Stortford (Mr. Wells). The Government believe that the principle of occupier-only consent is important. We are all familiar with the problems when there is delay in getting a line installed connecting one of our constituents to the telephone exchange. We have probably even experienced the problem ourselves at times. This prevents people from obtaining telephone service in their homes or offices. Such delays would be more serious in the future because of the growing importance of telecommunications in all aspects of business and social life.
  The Bill is designed to simplify and speed up the procedures for obtaining telecommunication services. Under the existing Telegraph Acts, which go back to the middle of the last century, consent has to be obtained from the owner, from any lessee and from the occupier of a property before an operator can install wires and cables. This legal requirement for the operator to obtain such a wide range of consents is profoundly unsatisfactory. En replacing the old Telegraph Acts we have opted for a much more straightforward procedure whereby a telecommunications operator need obtain only the agreement of the occupier of private land before he installs his apparatus. We have made exceptions to this where the occupier is a short-term tenant with a lease for a term of less than a year and where large apparatus is involved. The amendments made to the code earlier today also make provision to protect the interests of landlords whose consents are not required under the code. I hope that the House will forgive my making these points, but as we were unable to debate them it is useful to make them known in this way.
  Returning to the 1981 Act, the second area in which further changes were required concerned the "exclusive privilege" to run the telecommunications systems, which was left in that hands of BT. Under the 1981 Act, BT could do everything in telecommunications and was subject to no limitations, whereas its competitors were licensed and

  1231
  controlled. The Bill removes the exclusive privileges of BT and subjects it to licensing controls comparable with those which apply to any other telecommunications operator. I should add that these licensing provisions guarantee the rural services, the 999 services, the public call boxes, and services to the disabled, about which so much misinformation has been published.
  In yesterday's debates, the hon. Member for Newcastle-under-Lyme (Mr. Golding) who, uncharacteristically, is not present now, expressed much support for the principle of cross-subsidisation. When he expressed the view that business callers should subsidise private callers, I wondered whether he intended to try to persuade his colleagues to take the same view in relation to energy charges and to suggest that charges for industry should be increased to subsidise private consumers. To be consistent, he would have to do that. [Interruption.] The hon. Member for Wigan may have his lights on all the time, but it is not the best thing to do. Again, perhaps he will wise up to that, as the Americans would say.
  The third failing of the 1981 Act was that it left BT as a nationalised industry run by a statutory board. I pay tribute to Sir George Jefferson, the board and the management of BT for the improvements that they have made and for the co-operation that they have secured from the staff, the great majority of whom have been loyal and co-operative in seeking to make those improvements.
  The board itself, however, has statutory duties giving it power to decide the public interest in telecommunications. It has access to public finance at special rates. It also has the safety net of last resort—the knowledge that the taxpayer will stand behind it and pick up the bill for its mistakes if, indeed, the monopolist does not pass the bill direct to the customer. That framework — a statutory board with statutory duties, judging its own and the public interest, protected by monopoly and underpinned by the public purse and the wallets of customers who have no choice—is no way to set up a competitive organisation to respond to its customers. It is therefore necessary to complete the transaction started by the 1981 Act through the transformation of BT from a statutory body into a public limited company.
  The transfer of BT from the public to the private sector is an essential step towards ensuring effective and fair competition and towards giving the customer the choice which our policy is designed to produce. The choice, which is our essential aim, cannot be cosmetic.
  Mr. McWilliam: I was pleased to hear the Secretary of State mention access to finance and choice. He is clearly unaware that BT has not resorted to Government finance for many years, but has been a positive provider. The 1981 Act was about choice, and I was a member of the Committee throughout the passage of the Bill.
  Mr. Tebbit: I am sure that the hon. Gentleman is not about to tell me that BT has never had access to finance at preferential rates.
  Mr. McWilliam: What about ICI?
  Mr. Tebbit: ICI does not have access to the taxpayers' purse by right, whereas British Telecom always has had such access.
  I do not think the hon. Gentleman understands that there is a difference between the rates that one pays for
  1232
  finance when one has a guarantee from the Government and those that one might have to pay in the real world outside.
  Mr. Fisher: Is the Secretary of State not aware that British Telecom is paying many different rates of interest on various loans, all of which are at market value?
  Mr. Tebbit: Of course I understand that it is paying different rates, because its loans were made at different times. The hon. Gentleman must understand that an organisation which borrows with a Government guarantee is different from one which borrows without such a guarantee—[Interruption.] I am sorry, but I must repeat what I said to the hon. Gentleman. When the Government stand absolutely behind the financial obligations of any organisation, bankers look at the position differently from how they would view a commercial organisation.
  The transfer of British Telecom from the public to the private sector is an essential step towards ensuring effective and fair competition, not least because the rival companies do not have a Government guarantee when they look for capital, and towards giving the customer the choice which our policy is designed to produce.
  Mr. Lawrence Cunliffe: Some people will not have a choice.
  Mr. Tebbit: Some people do not have a choice today. Is the hon. Gentleman suggesting that everybody today is provided with a telephone as a social service? He must know that that is not true. He must also know that that was never such a proposal by any Labour Government. It might be proposal by the Labour party from time to time, but it is secure in making such proposals, knowing that it will never be in government.
  It would have been easy, in theory, to have attempted to move to instant free-for-all competition, and I am sure that some of my hon. Friends might have welcomed such an attempt, but I must tell them that I believe it would have been the wrong step to have attempted.
  Our purpose is not to confront BT with a series of minnows, with the appearance rather than the reality of competition. It is no easy task, where there is an existing monopolist, to introduce real competition. Experience in other industries where there has been a single dominant nationalised industry has shown that complete open market entry and a free-for-all can all too easily result in a number of small and under-capitalised market entrants attacking each other, hardly denting the power of the established monopolist and failing to grow to a scale to offer real alternative service. The result is that the customer is not given the effective choice which should be the result of our policies.
  Since telecommunication networks involve enormous investments, spread out over long pay-back periods, the problem is especially acute.
  There are other considerations, not least those of an environmental nature, such as the impact of proliferating overhead wires and street works. There is the physical limit on available radio frequencies. These in practice constrain the number of competitors that can be accommodated. For these reasons, we have decided that for the next seven years there will be two national operators providing the basic telecommunications service of conveying messages over fixed links whether cable, radio or satellite, both nationally and internationally.

  1233
  BT will be confronted, not with a series of weak competitors, but with a single, properly capitalised competitor with the technical and management resources needed to establish a competing network which will really compete. Its main competitor, Mercury, backed by two of the most significant companies in Britain, has the necessary technical and financial skills.
  Mr. Fisher: When discussing Mercury and competition, can the Secretary of State tell us exactly how many residential customers will latch into Mercury? Will the figure be zero?
  Mr. Tebbit: It is impossible to say to what extent the Mercury network will grow in future years.
  Mr. Fisher: What about next year?
  Mr. Tebbit: Of course there will not be any next year.
  Mr. Fisher: Where is the choice for residential occupiers?
  Mr. Tebbit: If the hon. Gentleman would restrain himself and learn some of the good manners that characterised his father, he would get on much better in the House. Competition will begin in the business sector and is already beginning to show its effect. We cannot move from 70 years of monopoly to complete open competition overnight. The hon. Gentleman really must grow up.
  There will also be the two national cellular radio networks and local cable system to intensify competition for BT. In 1990, when Mercury has established itself, and when BT has adjusted to competition, we shall review the competitive situation. We shall then see if there is scope for licensing additional competition. For the time being, however, we plan no changes.
  We have given firm assurances about our policy, and those concerned are spending hundreds of millions of pounds on the basis of those assurances.
  I have dwelt on what we have done in terms of the choice offered to the customer in this country. I have referred, briefly, to the protections that will be given, which are not in existence today, by the Director General of Oftel. Opposition Members would do well to examine those protections. They will then discover how they will enhance the position of the consumer from what it is today, and how they will strengthen the provision of the many services about which Opposition Members have wept crocodile tears for hours on end — not least the call boxes.
  There is a further and important dimension. We are creating a wholly new telecommunications environment which will provide immense opportunities and challenges. The companies which are set up, responding to market demands in this country, have the opportunity to take the skills, the technologies, the management techniques, which they develop and market them abroad.
  For too much of the interminable debate on the Bill the discussion has been narrowly centred on special interests, not least the special interests of those employed within the industry. The time has come for us to consider the wider horizons, the opportunities open in the most important sector of the modern industrial world. There is no need for BT to remain both protected and caged. The prospects are for exports, profits and employment. All this has been made possible by the changes in attitude which directly result from the policies of the Government.
  1234
  I therefore move that the House should, for the second time, give the Bill its Third Reading.
  7.38 pm
  Mr. Peter Shore: We have reached the Third Reading of this 195-page Bill. The discussion in Committee was protracted and lengthy. I pay tribute to my hon. Friends who played so full a part irk those proceedings.
  We have won most of the argument. We have persuaded public opinion. The Government lost the argument in Committee, the Minister for Information and Technology lost his voice——
  Mr. Fisher: They won the votes.
  Mr. Shore: That often happens, but equally those who do so often find that over a protracted period they eventually lose the vote.
  How often in the past 10 years have majority Conservative Governments enacted measures which at the time were thought to be the essence of wisdom only to repeal and tear them up five or 10 years later? I think in particular of some legislation that is now before us. Who were the architects of the present system of local government, and who are now about to tear that up? Who created an entirely new structure for the NHS in the belief that it was the right way to proceed, but who changed it only two years ago?
  I wonder whether in a few years' time the Government will come to the conclusion that somehow or other they have got this measure wrong. They had better contemplate that possibility, because as events develop over the next few years the arguments will increasingly reinforce the main principles on which we have criticised the measure and the main alternatives that we have advocated.
  In spite of all the debates, this is essentially the same Bill as the one introduced on 18 July. Not one Opposition amendment has been accepted, although the Government, because of faulty and inadequate drafting, have tabled a number of amendments. Indeed, only yesterday heavy amendments were tabled to the code, although the opportunity to debate those has been denied because we are operating under a rigid timetable motion. It is right that we should now stand back and look at the broad sweep of the argument as well as the principles and major policies contained in the Bill.
  I doubt whether any hon. Member doubts the importance of the continuing and future success of the British telecommunications industry to users, employees and the economy. Linked as it is with the computer industry, telecommunications is now the leading growth industry in Britain. The pace of development has been truly astonishing. In 10 years, the basic telephone service has entered the homes of 10 million new British subscribers. That is only one part of telecommunications. A whole range of new services are now being developed, mainly pioneered by Britain's publicly owned telecommunications industry. As I said in the guillotine debate, BT's record is
  "a unique combination of public service, priofitability and technological advance". — [Official Report, 21 November 1983; Vol. 49, c. 37.]
  Given its record and the enormous potential for further development at home and abroad, the onus of proof is indeed on the advocates of change. Why do the Government insist on a risky and destabilising strategy of privatisation and competition?

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  Some of the arguments have been put by the Secretary of State. It is obvious that to him it is simple. He supports the ideological assertion that in all cases, regardless of circumstances, monopoly is inefficient and that competition will be to the public good. He went so far as to suggest that to advocate a monopoly approach to a public service was to subscribe to the philosophy and doctrines of command economies in eastern Europe and elsewhere. That is fantastic and wholly unconvincing.
  If the wish of a monopoly to make a great public service universal is the test of a totalitarian society, the company of totalitarian nations has grown enormously, because most of the countries in western Europe — and the United States until very recently—maintain monopolies for good practical reasons. It is no good the Secretary of State bringing his hobgoblins to the House of Commons in an attempt to frighten us with what obviously frightens him in the long reaches of the night.
  Mr. Tebbit: Uncharacteristically, the right hon. Gentleman overstates my case. I said that the element of choice was the basic freedom that separates the West from East, and which has for many years separated the successful economies of choice and competition from the failures marked by centralised planning and direction. That is a more modest statement than the right hon. Gentleman's argument. I have never said that under no circumstances can monopoly ever be supported.
  Mr. Shore: In that case, it is difficult to see the relevance of the broader statement. The right hon. Gentleman is not here to give a philosophical dissertation about East and West. He is here to put the case for supporting the Bill.
  We are discussing two areas of competition —competition in the provision of networks and services and also in the supply of equipment and apparatus. As to the provision of services, the Government lack the courage of their own convictions. The Secretary of State made that plain in his defence of duopoly and cautious development.
  Indeed, when speaking of free competition, the then Secretary of State was equally careful. He said that the Bill "contributes" to free competition and brings that nearer. Mercury and the new licensed operators for specialist services such as radio telephones will be allowed to cream off the most profitable traffic, but the authors of the Bill have made the basic decision. They will not break up British Telecom or separate local services from the trunk services, not because there are limits to their pursuit of dogma but because that would be incompatible with the continuation of what the former Secretary of State described as
  "the present statutory duty for BT to provide a nationwide service".
  He added:
  "that duty has been extended from a duty to provide a telephone service to a duty to provide telecommunications services. This reflects our commitment to making modern telecommunications facilities and services available to all".—[Official Report, 18 July 1983; Vol. 46, c. 35.]
  Whether in practice these public service obligations will be fulfilled under the proposed arrangements, we have the gravest doubts. There is public recognition by Conservative Ministers that already competition across the whole of BT's service would be incompatible with the imposition upon it of public service obligations. We are
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  to have, therefore, not free competition but carefully regulated competition at the profitable margins of BT's activities. As we heard reaffirmed today, there will be no further general licensing other than for Mercury until at least 1990.
  Now a word about the second area of competition—competition in the provision and purchase of equipment and apparatus. Here things are different. In this important area competition is to be meaningful. Some 70,000 people are employed in the supply industry in great companies like GEC, Plessey and Standard Telephones and Cables. For a long time 95 per cent. of BT's requirement for capital and other goods has been purchased from British firms. There is a small but useful favourable balance of trade in telecommunications equipment. It is not much. The last figure I have for 1982 from the "Business Monitor" series shows a balance in our favour of £18 million to £19 million.
  What is to happen? Soon the British market will be open to the world. Of course, there will be regulation of the apparatus. It will have to pass certain tests. A foretaste of what we can anticipate was given in the reply by the Under-Secretary to a question only yesterday. When he was asked about approvals for types of telephones, not under this Bill which will open up new possibilities but under the British Telecommunications Act 1981, he said that there were no fewer than 112 applications for approval for different types of telephone, of which only half came from United Kingdom firms. There were others with UK components in them but the other half had a foreign content.
  The House is indebted to my hon. Friend the Member for Wigan (Mr. Stott), amongst others, and the hon. Member for Amber Valley (Mr. Oppenheim), who is not in his place, for opening up the important subject of trade in telecommunications apparatus. The hon. Member for Amber Valley's illustration of the kind of equipment that is already on order, and the extent to which Japanese, German, Swedish and other suppliers are already involved in the supply of apparatus needed for the development of British telecommunications, is disturbing.
  The hon. Member made an important point. I do not think that his proposal would be successful; indeed, I think it was muddled. He talked about reciprocity. He asked what guarantee there would be that if Britain opened its market for telecommunications goods of all kinds, other major countries would do the same. In most countries of the Organisation for Economic Co-operation and Development—it is true of Japan, France, Italy, Sweden and Germany — a preference for the country's own goods is jealously safeguarded to defend a basic industry which those countries are not willing to see opened up to the ravages, as they may turn out to be, of competition.
  Mr. Gerrard Neale: Will the right hon. Gentleman comment on the view put by many manufacturers in this country that they have been uncompetitive overseas in recent years—the right hon. Member described it, I think unintentionally, as if it was an aberration in the trade figures, but it has been going on for a considerable time—because British Telecom was so introverted about what should be used here, and because they as companies depend on a growing, developing and evolving telecommunications market to have saleable products for overseas markets? They say that they have

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  been unable to be competitive in those markets and that at last they have the prospect of competing not only at home but abroad with competitive products.
  Mr. Shore: In some cases it does not reflect well on British suppliers. For the last decade when the Government have been a major purchaser the relationship between Government and private suppliers has been of major concern to nearly all economic Departments. The same kind of problem arises when the Ministry of Defence orders British warships—to what extent is it meeting simply a British home requirement? Surely the suppliers can be pushed into considering wider markets. This requires energetic Ministers, a positive interventionist approach and a bringing together of consumers and suppliers to take account of the needs not only of the British but of the wider market.
  Mr. Tebbit: The right hon. Gentleman has raised an extremely interesting point. The problem, as he knows, was that British Telecom was not a good customer of the supply industry. The story of system X illustrates that. May I put to the right hon. Gentleman an experience which he and many other hon. Gentlemen may have shared with me? Under the sub-monopoly of the monopoly of BT I used to have a telephone answering machine. It was not a very good one; it was very expensive, but it was all I could get. When the monopoly was ended, I found that I was able to purchase freehold a much better machine for less than six months' rental. Because the British manufacturer had been protected by the monopoly, there had been no drive for him to improve his product. The product I had to buy was, regrettably, Japanese.
  Mr. Shore: I am aware of this as a serious problem, but there is a great danger. Effort must be put into an industry which is changing. The main thrust of BT over the past 10 years has been, first, in exploring new services and development, and then in extending massively the provision of telephone services. Let us remember the figures—10 million new home subscribers in the past 10 years. Neither British Telecom nor its suppliers have put the same effort into more sophisticated apparatus. They have not been encouraged to do so. They should be encouraged, but I do not despair. I do not believe that the only way to get British manufacturers to produce the right kind of goods is suddenly to say that the market should be opened up to competition by letting in a flood of imports. That is too crude and will not work. It will be too late. We shall find that we are losing out on the balance of trade which has been modestly in our favour.
  I should like to refer again to yesterday's exchanges in the House. Leaving aside the larger argument, we were told that the export-import ratio between Britain and the Common Market was 66 per cent. Four years ago—when the right hon. Gentleman and his hon. Friends took over—the figure was 89 per cent. That shows the drift and the trend. In a written answer yesterday we were told that in 1973 the export-import ratio between Britain and the Common Market was 130 per cent. We exported much more than the Common Market. This is a serious development. I do not believe that it is sensible or that the case has been made—I believe that all the evidence is to the contrary — that this massive change should be brought about simply to get rid of what has been a progressive public service monopoly and to replace it with competition in the two areas that I have described.
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  I have dealt with competition but what other arguments are there? Privatisation? I recall the Secretary of State's predecessor speaking about major difficulties with funding future investment. I interpret that in some ways as a desire on the part of the Department of Trade and Industry to be rid of the clutches of the Treasury. It is an assertion of the Department's belief that this rapidly growing industry can secure the funds for its further capital development only if all responsibility is taken away from the Chancellor of the Exchequer. I understand that. Indeed, taking account of the policies and achievements of the present Chancellor and of his unfortunate predecessor, I have some sympathy with that point of view. I see that the Minister for Information Technology is solidly in agreement.
  My remedy is different. I would prefer to rid the public sector of the Chancellor rather than of British Telecom. That is a simpler, swifter, and less expensive remedy. As the Secretary of State's predecessor put it:
  "By removing BT from the public sector, as is proposed in the Bill, we shall be freeing the company to seek finance in the market."—[Official Report, 18 July 1983; Vol. 46, c. 27.]
  We are told that the Government cannot finance future investment of British Telecommunications but that the market can. Both propositions are nonsense and, indeed, dangerous nonsense.
  Self-evidently, the Government can finance the investment programmes of BT. They have done so for the past 70 years and there is no earthly reason to believe that they cannot do so in the future. I should of course add "finance to the extent that external finance is required." That is a major qualification for the truth is that, as my hon. Friends have been pointing out, like all large organisations, whether publicly or privately owned, by far the greater part of BT's investment finance comes from its own retained profits. Indeed, it was only during the last period of Conservative Government, led by the right hon. Member for Old Bexley and Sidcup (Mr. Heath), and in the earlier period of Lord Wilson's Labour Government when the nation faced a tidal wave of imported inflation, that the prices and charges of the nationalised industries including British Telecom were deliberately depressed as part of a national counter-inflation strategy.
  Only then, in those few years, was any substantial part of British Telecom's expenditure financed by Government loans. In 1982–83, British Telecom's capital expenditure was more than self-financed. The external financing limit was negative to the tune of £220 million. This year, 1983–84, with an investment programme of just on £2 billion, British Telecom is once again expected not to draw on the Government finance, but to contribute £100 million to the external financing limit. Next year, 1984–85, the contribution is expected to rise to £250 million. Far from adding to the public sector borrowing requirement, British Telecom is actually reducing it. So much, then, for the alleged restrictions imposed on the growth of BT by the disciplines of public expenditure control.
  Of course, it may be that BT has plans ready and waiting well in excess of its present £2 billion per annum investment programme, which, if carried through, would exceed its capacity for self-finance. If this is so, the House should be told. It should be told the size of the alleged capital requirement that is not now being met.
  What indeed are the financial borrowings, whether in the form of equity capital or loans, that the Government expect a privatised BT will need to raise from the market? What is their expectation about the recourse of BT to the

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  market over the next few years? Surely they have made that calculation because we are dealing with an industry that must plan three, four, or five years ahead. The Government are not replying. Do they know? Since it is precisely in the area of high technology, heavy investment industry that the market has, over the years, proved to be a most unreliable source of funds, why does the Secretary of State think that any significant increase to the privatised BT's investment programme could be more easily financed from this source, the market, rather than from self-financing or Government loans?
  It is not a convincing argument that the only way to finance British Telecom's expenditure is to go to the market and to take it out of the public sector borrowing requirement. One must look for other and more convincing reasons. I can offer only two. Firstly, there is the belief that the Government obviously hold that all profits should be privately appropriated. Profits must accrue not to the public but to the shareholder. Loss-making industries, if they cannot be closed down, are okayed for the public sector. Profitable industries must be turned over to private ownership. Secondly—we are coming here to perhaps the most powerful immediate motive — there is the Chancellor's special requirement. If he can sell off this most valuable public property, if he can raise the £4 billion or so that a 51 per cent. private stake in British Telecommunications will yield, in the short term, he will have that much less to raise in taxation or borrowings. The Chancellor and the nation can to that extent postpone the day of reckoning that lies ahead for the failure of his own economic, monetary and fiscal policies. Just as we are squandering the benefits of North sea oil, so too we can live for a time off the proceeds of public property sales. In the last Parliament, £1·33 billion of public assets were disposed of. In this Parliament, if the Government's manifesto commitments are carried out, no less than £7·5 billion of public property will be sold off. Of course, there are limits. The stock of public assets, although large, is limited. So too are the reserves of the North sea. The Chancellor's philosophy—the Secretary of State has not the wisdom to combat it— seems to be "apré moi le deluge". While the terrible day of reckoning undoubtedly lies ahead, I do not think that the Secretary of State or the Chancellor have even begun to understand the immediate effects on the capital markets of their policy of mass sales.
  The Government have been reticent about the details but it is a reasonable inference to say that they expect to sell off £2 billion this year and they expect to raise a further £2 billion in the following financial year. Never in their history have the Stock Exchange or the British capital market been faced with such a huge single demand. In the past six years, 1977–83, total United Kingdom capital issued for all industry and commercial companies has exceeded £2 billion in only one year. In 1983–84 the figure may reach £3,000 million. I emphasise that the figure that I have just quoted includes the total of new capital issues for industrial companies and for commercial companies, including banking and insurance companies. To seek to raise £2,000 million in a single issue of BT shares is bound to have major repercussions. Unlike other company issues, the money raised will not be used to finance new investment, but the existing stored value of BT will simply be abandoned.
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  To attract such a vast sum, the share price will have to be well below its real value. Unless a substantial proportion of the vast sums of British money, which are now pouring into the equity and property markets of other countries, is diverted back to London, there will be a danger of crowding out. The overall effect will be a rise in yields and increased difficulties for existing private sector companies that seek to raise new capital. The Government know that, which is why they are trying to encourage the Americans and the Japanese to purchase BT shares.
  I can recall no piece of industrial legislation which is so clearly against the national interest as is this Bill. There will be many more stages before its implementation, and the Opposition will use them to expose and oppose what is being done. We shall seek to repair the damage done and recoup the losses to the public as soon as we have the power and opportunity to do so, and we shall vote against the Bill tonight.
  8.12 pm
  Mr. Richard Page: I rise, as a veteran of three telecommunications voyages, with a sense of relief that the harbour is at last in sight. I look for a respite from the false storm warnings that have been produced by Opposition Members, and a rest from their dulcet tones of more than 300 hours in Committee. Although it was a good-humoured Committee, Conservative Members realised that the objections to the Bill came from dogma, not from the realities of the telecommunications world.
  I welcome the Bill because it is a further means of reversing the hitherto genteel decline of the British telecommunications industry on the world stage, to which the right hon. Member for Bethnal Green and Stepney (Mr. Shore) referred. It will give a welcome shot in the arm to the British home industry. An examination of our percentage share of the world market shows that we now have only 5 per cent., and it shows the effect of decades of a cosy, uncompetitive and, dare I say it, incestuous relationship between BT and the United Kingdom suppliers. The chief characteristic of that relationship was a marked lack of change. Although the technology was known, and was being produced and installed throughout the rest of the world, the rub was that that technology was being installed in and produced by the rest of the world.
  First, it is right to look back and contrast similar protestations of doom from Opposition Members before the British Telecommunications Act 1981 with the reality of it, which is a better choice of services from BT during the past three years, shorter waiting lists, reduced trunk call charges and improved equipment. The Bill continues the change started in that first Bill of 1980, and will free the home communications market by removing the privilege and monopoly of BT. It will do that by providing a further choice for consumers on the home market. That spur of competition will provide the springboard for information technology in the United Kingdom, and from there a base from which to claw back those lost overseas markets. That will take us back to our position of 25 years ago, and we will again have 25 per cent. of the world telecommunications market.
  If I have said it once in the House, I have said it half a dozen times that the Japanese have designated information technology as their major growth area during

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  the next decade. They are looking to that sector to provide the most employment, and we should be wise not only to recognise that judgment but to act upon it.
  It must be obvious to the House that the introduction of new equipment to meet or to provide competition must give a home market base of such a size and substance that it will in turn provide a base for export. I do not wish to labour the point, but the recent order by the Hull exchange for system X is an example. In the interests of balance, I must also mention the optical fibre cable order from Mercury. Such orders and developments will assure employment. The scare of unemployment has been trailed regularly across the Committee floor, and it takes a peculiar courage to ignore the increasing numbers employed in that sector in Japan, and the increasing employment in the telecommunications and supply industry of the United States of America.
  To continue to prophesy that this Bill will cause a reduction in employment shows a remarkable lack of faith in the effort and ingenuity of the British people, especially those employed by British Telecom. Those cries of doom ignore the inward investment in high-tech industries in Britain during the past four years, with about 60 companies investing here and creating at least 48,000 jobs.
  The cries also ignore the activities of the value-added network companies, such as Tunstall Telecom, which provides the equipment for Highland regional council's help call. I wish to mention that service briefly, because it illustrates the sort of service that is now becoming available to the people of Britain, and marks the progress of information technology. It is an emergency communications service for about 300 people in the Highland region, which represents about one tenth of the land mass of the United Kingdom. Those whom it helps are mostly elderly or in some way at risk. They carry with them a small device; when they are in trouble, they press that device, which then opens up a two-way communication service. They can speak to the control centre, which may be many miles away, which provides them with assistance. It is a sophisticated device which enables people to remain longer in their homes and with their neighbours and friends, and it puts off the time when they must enter residential care. Such services will become more common as a multitude of companies seize the opportunities opening in front of them. The services will also provide more employment.
  Mr. Charles Kennedy: I am grateful to hear of the hon. Gentleman's interest in a major benefiting service in my constituency. I am sure that he will share my concern and regret, and that of those who have benefited from Highland help call, that current financial restraints and pressures upon local government in that part of Scotland, as a result of measures such as those announced this afternoon by the Secretary of State for Scotland, endanger the future of the system.
  Mr. Page: All that I can say to the hon. Gentleman is that I believe that such services will become freely available throughout the length and breadth of Britain. Nothing can hold back the march of progress once this liberalising measure gets fully under way.
  Labour Members have raised objections and scare stories about unemployment. In the light of the facts, I and my hon. Friends are inextricably drawn to the conclusion that the truth of the matter is that they are motivated purely
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  by the desire to preserve their sponsoring unions rather than to see a general national growth of employment in this industry.
  The creation of Oftel and in particular the role of the Director General of Telecommunications will be crucial in seeing that fair play is operated in the competition policy between the licensees. Members of the Committee who will serve on this Bill and those who served on the previous Committee know that on this aspect the Conservative Members, if they could get a word in edgeways when the hon. Member for Newcastle-under-Lyme (Mr. Golding) was giving one of his two, three, four or 11-hour speeches, were concerned to see that there was a clear, understandable competition policy. My hon. Friends the Under-Secretary and the Minister for Information Technology have created by the Bill a framework in which the licensees can operate. The role of Oftel can be most effective in introducing a sensible route of competition, perhaps not fully free-ranging, but, most importantly, practical, to give the best results of service, quality and choice.
  The Government's choice was between complete liberalisation which might have created uncertainly, with nobody prepared to invest and to compete fully with BT, and the encouragement of one strong competitor so that an increasing number of customers should have a genuine choice. The Government have made the right choice, and therefore I hope that we shall soon hear an announcement about the post of the Director General, and who w ill fill it, so that he has as much time as possible to bed himself in and familiarise himself with the task before the Bill becomes an Act.
  The Bill is a great liberalisation measure and already the speed of BT's reaction to impending competition has been noticed and appreciated. Waiting lists have been slashed from over 100,000 to a few thousand. BT salesmen are keen and motivated to provide BT goods and services, as my constituents have noted and reported to me.
  I know that several of my hon. Friends will want to make some contribution to the Third Reading debate and I know that some Labour Members would like to finish with a short contribution after 300 hours of Committee, so I shall not take up the many points that were freely and openly put to us during the Committee. This is the most important privatisation measure that has been brought before the House in this Parliament. I congratulate my right hon. and hon. Friends on the Front Bench on piloting it through Committee, and warmly recommend it to the House.
  8.23 pm
  Mr. Charles Kennedy: As other hon. Members have said, this is the last occasion on which this company will debate this measure. Both as a new Member and as the sole alliance representative on the Committee, I thank both sides of the House for the courtesy which they have, by and large, extended to me. I say that particularly to the rather infamous hon. Member who, when I met him and got to know him, turned out to be not nearly as bad as his reputation, the hon. Member for Newcastle-under-Lyme (Mr. Golding).
  Despite the niceties, at the end of the day the alliance remains opposed to this measure, because, as previous SDP and Liberal spokesmen have said, it is part of our political thinking to want to stabilise the frontiers between

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  the public and private sectors in British industry. For various reasons, which we have argued in the past, this measure will only disturb those frontiers.
  As the right hon. Member for Bethnal Green and Stepney (Mr. Shore) pointed out, this is not privatisation or liberalisation as many would understand it. Instead of a truly competitive market, we are seeing the institutionalising of a private monopoly. As such, the private monopoly will be detrimental for the consumer, both in terms of services and of charges, and for BT, in terms of its development and future investment.
  As the Minister is aware, the alliance has expressed concern and opposition to many parts of the Bill. I shall not go over the old arguments again on such things as rural communities, the missed opportunity for industrial democracy or the problems faced over the pension issue. Instead, given that the legislation will be passed at 10 pm, I shall look briefly at the role of Oftel and what we see to be the problems that it faces. I shall also make some constructive and positive suggestions about improvements which I believe the Secretary of State and his Ministers may use and implement, if the hints that I have received from various sources are correct, in the time ahead as the new set-up is improved and brought in.
  Oftel has three potentially conflicting tasks. It has to try to achieve fair network competition, to provide fair apparatus supply competition and, at the same time, to try to protect the consumer and the community. It has already been argued by the right hon. Member for Bethnal Green and Stepney that a not particularly competitive set-up will emerge as a result of the legislation. I wish to examine the achieving of fair apparatus supply, which will be one of the issues confronted by Oftel.
  At the moment, the markets are not large enough for the achievement of real competition. In each of the last two complete financial years, for example, telephones and service have increased annually by about £250 million. Once that figure is divided among the few suppliers that we now have, it is doubtful whether there will be room for either further manufacturers or, if it is economic, for a major manufacturer to supply direct or through the outlets on offer through BT.
  The economics of production of the basic telephone instrument appear to dictate that competition will be limited, for example, to the so-called fancy or gimmick phones. I noticed recently "Snoopy" and "Mickey Mouse" telephones. I am tempted to suggest that the Cabinet should use a "Snow White and the Seven Dwarfs" telephone. As one Conservative Member said, imports will pose an extremely serious threat to British industry, given the problems that will be faced domestically over the comparative smallness of the market that will be opened up.
  Oftel will face problems from the consumer and the community, which will have to be examined in comparison with BT. Oftel already appears to be under-resourced. We have heard the figure of about 50 internal staff and a modest budget. BT's corporate headquarters employed over 2,000 staff as at the year ended 31 March 1983. Moreover, 25 per cent. of those staff are being paid in excess of £30,000. As details of Oftel become clearer, it appears that the salaries will be fairly modest in comparison. There is a danger, therefore, that either the
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  intellectual or the technical calibre in Oftel will not match the competition that it will get from BT. That is a danger, and I hope that the Minister can reassure us on the matter.
  I want to say a word about the regional implications of the Bill — the powers that are given to the Director General to set up regional advisory bodies in, for example, Scotland and Wales. It is said that finance will be provided to the Director General to set up these advisory bodies
  "to such extent as may be approved by the Treasury".
  I hope the Secretary of State will appreciate that those words are of deep concern to the Opposition. In fact, I sit here as a Member of Parliament because those words cost the previous Member for the former Ross and Cromarty constituency his seat at the election, in that the Treasury did not produce the cash and the public did not produce the votes for the gentleman who is now Lord Gray. That was largely because of the problem of trying to get finance from the Treasury, and I think it is fair to say that the same problem could well arise with this legislation.
  The licence itself is weak, in that it does not appear to allow the Director General to deal with anticipated breaches of its terms. The breaches have to be manifest before action can be taken. Perhaps more seriously, there do not appear to be powers to allow the Director General to deal with predatory pricing. Cross-subsidisation is restricted between equipment provision and network provision, but not within the network provision. Thus, profits may be used — it may be a danger in the legislation—from one line to stave off competition on another, apparently with impunity.
  Let us compare the position in the United States. DATRAN was eliminated from the market there by AT and T by precisely those tactics. Surely, therefore, there should be further provision for interim orders to be made when breaches of the licence are suspected, thus speeding up the official response and reducing the likely attraction of such tactics.
  The real importance of the RPI-X formula is not simply to stop the overcharging, in the sense of a calculated exploitation of consumers, but also, we hope, to keep up the pressure for efficiency improvements in the new regime that will take effect from next year. I am sure that the Minister of State will bear that in mind. However, it is unlikely that Mercury or the cable operators will supply enough competitive pressure to achieve that, for a number of reasons. Those reasons include the size and permitted scope of operations, as well as the limitation on further competition.
  X should surely be calculated to force BT to adopt the most efficient methods and practices available by reference to the trend that has been achieved abroad. We accept that it is not easy or straightforward to achieve those targets, but it is a price that BT should be expected to pay for its continuing privilege and dominance. An international comparison currently suggests that 7 to 8 per cent. would be a feasible value for X, implying a reduction in overall costs of 32 per cent. in the next five years.
  My argument is one of opposition from the Liberal-Social Democratic alliance. None the less, accepting the political reality of the situation, it is a constructive opposition, bearing in mind what has yet to be done. Our own policy, lest anyone should inquire about what we would do at a future date, were we in a position to do so, is to accept that privatisation has gone ahead but to realise that changes and improvements can be made. We hope

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  that the Government will not be too dogmatic and thereby miss the opportunities that will present themselves to do that.
  I end by quoting from a recent letter in the Financial Times by none other than Sir George Jefferson. He was replying to criticism that had been expressed in that newspaper by a reader about the advertising campaign that BT had been conducting. I do not quote it to draw attention to the campaign, but because it raises an important matter. It said:
  "British Telecom is concerned to ensure that its customers and its employees are informed of the facts, upon which they can base their own conclusions".
  Although I was not a party to the exhaustive Committee deliberations on the Bill, I nevertheless hope that the Government will acknowledge that many of the facts have been highlighted by the Opposition, and I hope that we on these Benches have contributed to this process. If our worst fears are confirmed and the facts become more apparent in the years ahead up to the next election, the Government may find that public opinion, which has been swinging against them on this issue, will repudiate them, in contradiction of the way in which they endorsed the Government, in some respects at least, last June.
  I speak in a spirit of constructive opposition. In that spirit I hope that, even if the Bill is passed this evening and becomes the modus operandi of the future, the Government will bear in mind their obligations to the people of the country as much as to the employees of BT.
  8.38 pm
  Mr. Peter Thurnham: I spoke on a number of issues yesterday, but I take this opportunity to speak on an additional separate matter. One of the most significant developments since the Second Reading last summer—I do not belittle the efforts of the Committee — has been the complete collapse of the union's campaign of disruption and strike action. I welcome that development, which I believe is a result of the efforts of my hon. Friend the Minister for Information Technology, who has laboured to make the Bill such a good measure. His efforts have gone a long way to ensure that the Bill is fair, and that the various interests have been reconciled, one with another.
  One of the most important aims of the Bill is to promote competition. Here we welcome the development of Mercury as an alternative network. Mercury is planning to provide a link to the north-west. I welcome that as an extension of service to my constituents. Nevertheless, I regret to report that Manchester city council has decided to reject and frustrate the efforts of Mercury to set up a radio telephone link in Manchester. On Tuesday, the Leftwing dominated planning committee threw out Mercury's application as an admittedly political decision. The union had prompted it by saying that radio waves were dangerous, although the planning committee neglected that. I deplore that action. It can only damage the interests of all who live in the north-west. It is doubly unfortunate, in view of the north-west's record as the crown in BT's services, with eight firsts and seven seconds in the league table of service. I have already drawn attention to the fact that Bolton is the jewel in the north-west's crown, but I call on Manchester city council to do its bit to make the north-west the best of Mercury's service.
  I urge all hon. Members to put the Bill on the statute book without delay.
  8.40 pm
  Mr. John Golding: The problem with this debate is that we must address ourselves to questions which do not belong to a Third Reading debate. It is necessary to make almost a Second Reading speech on this occasion. The Government have brought the Bill to Third Reading but they have left so many problems unresolved. They should have solved the problems before they reintroduced the Bill this Session. They knew that it was in a shambles when it received its Third Reading on the first occasion before the general election. They knew that problem after problem remained unresolved but they chose not to set about solving them. They merely reintroduced the Bill and it remains in chaos and confusion.
  My speech will be addressed neither to the Minister without words nor to the Under-Secretary of State without brief. Instead, it will be addressed to those in another place. We must ensure that the issues that are unresolved, along with the doubts and uncertainties, are well debated in another place. They must be given further scrutiny in another place.
  There are those who say that this is the end, but they have overlooked the long debates that will take place early next year on Lords amendments. I look forward to the time when reason prevails in another place in contrast to the voting juggernaut of the Tory Government. I look forward also to the amendments returning to this place.
  The Bill is a disgrace and it is no wonder that the Government do not understand it. It is not comprehensible to anyone. When the Minister of State was ashamed of it in Committee, his practice was to leave matters to the Under-Secretary. He did so because the Under-Secretary understood little. When he presented sections of the Bill that were meaningless, we were expected to notice no difference. For example, clause 25 is incomprehensible. Conservative Members were quite forthright in the Committee Corridor and in the Tea Room. They scented, too, to consider the clause to be incomprehensible, but in Committee they voted for it. They did so because the Whip rounded on them. The Whip insisted that they should vote for something that no one understood. The only person who thinks that he knows what it is about is the draftsman. There are many such clauses in the Bill and those in another place will have a busy time.
  Huge sections of the Bill have gone undebated, yet Government amendments have poured in this week. The sections remain undebated, yet more than a year after the Bill's introduction the civil servants are still providing Ministers with amendments to their own legislation. The fact that such large sections of the Bill remain undebated cannot be attributed to delaying tactics or obstructionism on the part of the Opposition. I shall not be surprised if further amendments pour out in bucketfuls in another place.
  I think that the Bill was introduced at an early stage because, given the hours of their sittings, their Lordships will probably take months to cope with Government amendments before account is taken of the amendments that must be tabled by those in another place in an attempt to make the Bill acceptable.
  I should not be forced to make these comments on Third Reading. If necessary, I should not be surprised to have to make them on Second Reading. However, the Bill is in such a shoddy condition that it still remains necessary to

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  amend it in Committee. I see that the Minister of the State is taking notes. I sympathise with him tonight because I know that he wants to make a great historic speech. He wants to say that the Bill is the greatest measure of this Parliament. That is the speech that he made during the previous Parliament, but he did not mention the Bill during the general election. He wants to claim that the Bill is historic legislation, and he will have to make that speech with a croaky voice. I feel sorry for him because his speech will hit a false note from beginning to end.
  Those in another place will have to examine carefully the Bill, the draft licence and the Littlechild report. The Bill is badly drafted and the licence is completely inadequate. We have made some impact upon the licence, but it remains completely unsatisfactory. Even now, a year since the Bill was introduced, we are receiving letters from POUNC begging us to ascertain what the Government intend to do about access charges and the implementation of their cross-subsidisation principle. The Secretary of State's approach is one of rejection, and perhaps that is why there is delay. The Minister of State may still be plugging access charges, which are taxes on international calls and trunk calls, to enable services to be provided in rural areas, if the Minister knew what a rural area was.
  The Minister of State wants some cross-subsidisation but we heard the mumblings of the Secretary of State last night. We heard that he believes that people should pay the full cost of the services that they receive. In other words, no cross-subsidisation. There is a split in philosophy between the crowbar kid, the Secretary of State, and the whiz kid, the Minister for Information Technology. That may be the problem.
  Access charges were introduced because of a torrent of criticism from the consumer groups. I have never before been in such an alliance. It seems that I am supported by the National Farmers Union. I could not have imagined that happening when I was elected in 1969 at Newcastle-under-Lyme, which was then an agricultural constituency. I was elected despite the vote of the farmers. However, in 1983 I receive letters from the National Farmers Union in my constituency asking me to fight the Tory Government's anti-nationalisation proposals. It is unbelievable. Those farmers had not been brainwashed by advertisements in the Daily Mirror. Their reading does not go further than the price review. They get their information before milking time. However, they knew intuitively that the legislation would damage the rural areas.
  Unlike the Minister of State, the farmers know what a rural area is. They wrote to me to ask me to oppose the Government on this measure, and I have not let them down. Tory Members who say that we oppose the Bill only because of our sponsorship ought to see those letters. They are not all from farmers. My hon. Friend for Stoke-on-Trent, Central (Mr. Fisher) has reminded me on many journeys through Staffordshire how the local parish councils, the councils for social services——
  Mr. Fisher: The community councils.
  Mr. Golding: My hon. Friend corrects me. He must have reminded me of the community councils when I was passing a heavy articulated lorry in the rain. The parish councils, the women's institutes and the community associations are not bastions of the Labour party. They do not sponsor Labour Members. Their members attend
  1248
  coffee mornings run by the wives of Conservative Members who are missing their husbands because of the BT Bill. Yet those are the people, who, last year, asked us to attack the Bill.
  It was not just the spokesmen for the rural areas who asked us to oppose this reactionary legislation with all our might. I was astonished to find that the heads of British industry—the very people who had pressed for the 1981 Act — started to say, even on television, that the legislation was harmful to Britain.
  The Tory party on its own, therefore, was faced by a broad-based coalition, and even the Tory party was divided. The record of the Second Reading shows that Tory Member after Tory Member had reservations about the Bill. Tory Members—I shall not mention the hon. Member for Cornwall, North (Mr. Neale)—who at one time would have made powerful speeches on the Bill are now reduced to minor interventions. Why? Since they made those powerful speeches, they have listened to the Minister of State and the Under-Secretary.
  Mr. Neale rose——
  Mr. Golding: I knew that the hon. Gentleman would rise. I give way.
  Mr. Neale: I make this minor intervention to ask whether the hon. Gentleman intends to speak for much longer, or whether Tory Members will have an opportunity to speak.
  Mr. Golding: The debate has lasted for two days, but the hon. Member for Cornwall, North has not shown a great deal of interest. He comes here from time to time for old time's sake, but not very often.
  There are many subjects, such as access charges, which the Government must sort out before the Bill goes to another place. There is the question of "reasonable demand". I hope that the House of Lords will press hard to discover what reasonable demand now means in the legislation. Does it mean, as it meant in the licence before it was redrafted, demand backed by enough cash to pay the full cost of the service? If it means that anybody in the countryside, or anybody in need, can have a service so long as he can pay the full cost, then the reservations in the Bill and the licence mean nothing.
  The Minister of State must produce a definition of "rural". He has spent over a year taking the Bill through the House, and the Bill includes a section on the rural areas, and yet the Minister cannot define a rural area. That is a disgrace. I do not know how the Minister can face the House tonight, leaving that question unanswered.
  The Minister is sending the Bill to another place without having been able to explain the price formula or say what it includes. Unless the House of Lords is very tolerant, that will delay the business for some considerable time. I shall be disappointed if the House of Lords does not press for a definition of terms and an explanation of what the Bill is about.
  I hope that the ridiculous situation in respect of the right to strike will be dealt with in another place, and that the question of the sale of shares will be dealt with more thoroughly. I still find it a disgrace that officials visited Tokyo on 20 and 21 June to try to persuade people there to buy shares in BT. If the Lords want to see the minutes of those meetings, I shall be pleased to provide them—free. The Government are charging £1 for a licence so I shall provide my secret briefing for nothing.

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  I also look to the other place to go further with regard to protecting manufacturing industry. We know that we have Lords Weinstock, Carrington and Nelson of Stafford, all of whom are connected with the General Electric Company. I hope that their connection will not prevent them from speaking for their own and other companies. When the Bill goes to the other place they have a duty to speak up for Britain.
  The vicious attack that we heard yesterday from the hon. Member for Sleepy Hollow—for Amber Valley (Mr. Oppenheim)— should be answered completely by Lords Weinstock and Carrington. I hope that the present Lord Nelson does not turn a blind eye to the way in which Conservative Members who support the Treasury Bench are doing their best to smash British industry. I hope that they recant the support they have traditionally given to the Tory party and see reality. The Labour party is now the patriotic party. It is the Labour party that will defend British industry.
  What I find shattering about the Government's approach is that they constantly reiterate that there is no need for the staff to be worried. They say that this, that and the other will be provided for the staff but the staff have nothing in writing. I compare the Bill with the British Telecommunications Act 1981. In schedule 1 the Government then provided for a reasonable framework of industrial relations. The Minister had no difficulty in making such a provision in legislation then and he should have no such difficulty now. There is every reason to put safeguards for the staff into this Bill. If the Minister feels unable to do that he should at least put such safeguards in the licence. And if he cannot do that he should persuade Sir George Jefferson to put it publicly and categorically in writing that he, Sir George Jefferson, ought to do it. It is utterly wrong that the staff should have such uncertainty. It should be cleared up by categorical reassurances.
  The Minister has put safeguards for consumers and even for manufacturing industry into the Bill and the licence. If he can do that, he can provide safeguards for the staff. If Sir George Jefferson can spend so much money buying space in newspapers to reassure consumers and all and sundry that all will be well in the BT of the future and if he has no difficulty in buying in a future board now, he should find no difficulty in providing the staff with assurances. The attitude of the Government and, I believe, of the management of BT must have led to ever greater staff insecurity.
  I cannot understand what BT and the public can get from privatisation. My hon. Friend the Member for Stoke-on-Trent, Central has pointed out that payments of dividends will, at a conservative estimate, amount to about £350 million a year. The dividends payment of £350 million a year is equivalent to a 16 per cent wage increase. If the staff went to the management of BT and said, "Give us an extra 16 per cent on our wages next year, give us the £350 million," the reply would be that investment, prices and the future of the industry would be affected. My hon. Friend the Member for Bolsover (Mr. Skinner) says that even the pound would be affected. There would be apoplexy on the faces of the management. Governments would issue directives stating that in no way could anybody afford another £350 million.
  The Bill is concerned with giving private individuals public money to the tune of £350 million a year with no
  1250
  benefit to British Telecommunications, to the customer or to the manufacturing industry, but with wholesale damage to Britain.
  9.6 pm
  Mr. Neale: Firstly I should declare an interest in the subject. It was a pleasure to hear a fifth replay of the number four speech of the hon. Member for Newcastle-under-Lyme (Mr. Golding) as I have been on two of the three Standing Committees that have brought the Bill to its present stage.
  The Under-Secretary of State and the Minister of State deserve the congratulations of the House, particularly the Government Benches, for bringing the Bill and, indeed, all the legislation on British. Telecommunications to a conclusion.
  There is no doubt about the perception of hon. Members as to the difficulties of privatising a large organisation like British Telecommunications, but perception is very wide of the truth when it comes to judging the difficulties involved. I know well that, once an annoucement is made, an organisation such as British Telecommunications for its own interests immediately distances itself from the sponsoring Department. This makes it even more difficult for the officials advising the Ministers to obtain the information they need to prosecute the Bill properly through the House. From my own involvement in the subject, I think the officials deserve tribute for the way in which they have handled the matter. It is true that Ministers have suffered from unpreparedness in the industry to see the possibilities and difficulties involved in the legislation.
  There was criticism from the hon. Member for Newcastle-under-Lyme about the way in which my hon. Friend the Minister of State introduced various changes during the debates in Standing Committee on three occasions. In his defence, I should point out that the Minister has been willing to acknowledge that the situation in the telecommunications market place has been changing. It has been necessary to meet the various criticisms by creating more competiton. It is a great tribute to the Minister that he has been willing to do just that and to make certain that, as far as possible, the Bill meets, as much as possible, the criticism expressed.
  I was greatly reassured by the Secretary of State's comment on competition that, in his view, the door had been left ajar. He gave the clear impression that, once the door was ajar, it would be much easier to push it futher open.
  I am sure that my hon. Friend the Under-Secretary, who has put in many hours on this subject, is aware that apprehension still exists over two matters. One is the competition-free holiday during the period up to 1990. The second is the similar period that has been talked about in terms of the complete resale of network lines. I urge him and his colleagues at the Department not to commit themselves any more than they must to ensure that companies such as Mercury establish themselves quickly. They should not commit themselves too strongly to preventing competition in respect of network provision and network use in terms of resale, bearing in mind that technical development is fast and all-embracing and that there is every reason to expect that in the period to 1990 it will progress even faster. It is important that we allow for as much evolution in the development of telecommunications in its widest sense as we can.

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  The hon. Member for Newcastle-under-Lyme frequently reminded me that I represented a rural constituency. One of the planks of the Opposition policy was that rural areas would suffer most from the Bill. In the early stages of my representing Cornwall, North in the last Parliament I was constantly being bothered by people who were dissatisfied with the provision of service or who complained that they had no service from BT. In recent months I have received little or no comment about that service. It is obvious that as a result of the first liberalisation measures and the further threat of competition BT is much better placed and more willing to take the interest of the consumer into account and realises that the welfare of its employees, and of itself as a company, depends utterly on providing consumers with the products that they want.
  I hope that the Under-Secretary will accept our congratulations on bringing the Bill to this stage and will assure us that he will keep a watchful eye on the way in which telecommunications evolves in the coming period, and certainly over the years of this Parliament.
  9.13 pm
  Mr. Phillip Oppenheim: Opposition Members have expressed their deep, and understandable, concern about job losses. They have clear ideas about how jobs are created and protected. Monopolies, public ownership and inefficiency are apparently the great guardians of the economy and of jobs. Fortunately, everybody else knows that the only way to create and protect jobs in the long term is by having an efficient, progressive and well-managed industry.
  Apparently some Labour Members thought that BT was efficient in 1979. The hon. Member for Falkirk, East (Mr. Ewing) — who is absent for reasons with which we sympathise—said in Committee that he believed that BT was an efficient industry at that time. I can only assume that he was joking. I do not blame inefficiency solely on the BT work force. On the contrary, good management is the key to the efficient running of an industry, and much of the blame for the inefficiency of BT in the past must be laid fairly and squarely at the feet of its management. Already the British Telecommunications Act 1981, which the Opposition opposed tooth and nail, has brought greater efficiency. I do not believe that in their heart of hearts the Opposition would deny that. Privatisation will continue that process. That is the best safeguard for BT employees.
  What of the consumer? We have heard much on the subject of the work force from the Opposition, but we have not heard so much about the consumers. Surely the 15 million users of BT's services count for at least as much as the BT work force. In the past, before the 1981 Act and before the current measures were mooted, BT offered customers a frankly disgraceful service. Customers who had the cheek to ask for a phone were told to wait for at least six months and often for as long as a year. Getting in touch with the BT sales department was like trying to get a private audience with the Pope. Equipment was often poor and maintenance was often achieved only through bribery.
  The Opposition know that the 1981 Act has benefited users greatly. Already competition from Mercury has forced BT to bring forward its digital lines and to speed up the introduction of the X-stream services, which will
  1252
  be of great benefit. I do not know whether the Opposition know that. They are in a difficult position, and I have much sympathy with them. They are having to oppose, for dogmatic reasons, a measure that safeguards consumers as they have never before been safeguarded in this industry. The Opposition have had to ally themselves with two great vested interests in this country to form an unholy triple alliance between the Post Office unions, Lord Weinstock and the Labour party.
  Lord Weinstock of GEC opposes the Bill, as the Opposition know, because for a long time he and his shareholders have benefited from being part of BT's magic circle of approved suppliers. The unions oppose the Bill because they are unions. Labour Members oppose the Bill because one would expect something silly from them. By opposing the Bill the Opposition are striking a blow for the dead weight of the past. They bury their heads in the sand. One is almost surprised not to have heard any reference to what Nye Bevan, or Herbie Morrison, might have done about this matter. The Opposition make the Luddites look progressive. Conservative Members know that there is no conflict between private profits and public service. Profit is made by providing a good service. Until now, we have had huge public profits and a total lack of public service. The Opposition may well look back in anger, but we prefer to look forward.
  9.18 pm
  Mr. Randall: The Secretary of State's statement about the monopoly of telephone services was incorrect, because, in addition to our marvellous BT service, we have a separate telephone service in Kingston upon Hull and the surrounding area. Hon. Members will know that we are very proud of that service. It has been successful and I hope that with this legislation the Government will not destroy and impede the services which, over the years, have been provided so successfully in that area. The customers are extremely happy. The notion that we must privatise something to provide a service which is acceptable to the customer has clearly been shown to be untrue by the experience in Hull.
  The Bill will be a disaster for telecommunications services, the industry and the consumer. We seem to be embarking on a path of opening up the market in a way that Conservative Members believe most laudable but which shows a total lack of understanding of the British and world telecommunications market. The world telecommunications market is dominated by companies which are subsidised to the hilt by the countries in which they operate. Their products will now flood into this country. Sir George Jefferson has stated that that is his intention. Jobs in areas such as Liverpool and even in the constituency of the Under-Secretary of State, the hon. Member for Coventry, South-West (Mr. Butcher), will undoubtedly suffer as a result.
  It is nonsense to suggest that the destruction of the home market for our telecommunications industry can provide a basis for export potential. At present, about 9 per cent. of our telecommunications products are exported, and I accept that we must improve on that, but the Bill allows no time for adaptation to a new telecommunications market and will be a disaster for our industry. To believe that if we open up our market to all and sundry other countries will immediately do the same is sheer insanity, and I deplore it.

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  There is no doubt that residential users will suffer most, especially those in rural areas and in other areas which will not appeal to the new profit-motivated BT plc. So far, BT's operations have been based on the notion that all citizens, irrespective of income, geography or whether they are private or commercial users, are entitled to a service. We support that view, given the importance of communications in modern society. Moreover, the service should be good. There is no excuse for poor service.
  Both we and BT believe that an important challenge lies ahead to ensure that the services provided are nothing but the best. BT is geared up to do that. It has undertaken the basic investment to establish the network and to ensure that a large majority of people have telephones. Since the early 1970s the number of telephones has increased dramatically and there is now good coverage. More remains to be done, but the Government are now kicking BP workers in the teeth, discounting the marvellous work that has already been done and selling off the whole operation to their friends in the City.
  With privatisation, the notion of providing a good service to residential users will be a thing of the past. We want a national telecommunications service for all the people of this country, but the Bill will destroy that philosophy. The private shareholders will ensure that BT concentrates on the most profitable routes. There is no question about that. There will be immense pressure to maximise profits and dividends. The notion of cross-subsidies will be deemed undesirable. People who live in remote parts of the country will have to pay the full price for the service. The consequence will be that if one is not well off one will go without. There will be no choice. Persons in that bracket will not have a choice and will be priced out of telecommunications.
  The total emphasis on profitability will mean that residential subscribers will lose out—the consequence of privatisation. The trend already exists. We have seen the rebalancing of the tariff, and as recently as July, and in November 1981, we realised that the Government wanted to reduce the cost of telecommunications to the business sector and to increase the cost to the individual. That trend will continue as long as the Conservatives remain in office.
  BT, as a nationalised industry, has a special responsibility to look after those in the community who have special difficulties. The Government will discount the chronically sick and the disabled. They have no regard for them whatever. The Opposition believe that the disadvantaged should be considered. As a private company, BT will be subject to market pressures and it will not have the money — the shareholders will not allow it to provide the money—the time or the incentive to help the disadvantaged. The enactment of the Bill will result in that situation.
  If the Government have less than 50 per cent. of the shareholding, their ability to influence policies will he lost. That is a significant threat to public accountability. The theme of the Government's privatisation proposals is to permit cream skimming of the market. BT will be forced, as a result of being put into a competitive environment, to concentrate on the most profitable routes. The logic of competition is that competing companies fight for the most profitable routes. The principles of public service will be discounted. The work of the Committee has shown that to be so. The Government have not given assurances that such services will be provided.
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  Mercury has identified the most profitable parts of BT's network and has concentrated its services around them. It is already linking 26 major cities because the business user provides the most profit by using the service at premium rates. The Bill has nothing to do with providing a national service. Its purpose is to provide an out-of-balance service for business.
  We accept that business must be given every opportunity to communicate effectively. We have nothing against business, but we want equity in the way that services are provided. Cream skimming will result in BT responding by cutting charges on selected routes. A sum of £300 million of vital revenue will be lost annually, which will bring pressure for reduced services outside the golden "figure of eight" which includes the 26 towns.
  The argument that privatisation is essential to force BT to be competitive is inaccurate. BT can provide all the services that Mercury plans to install. The signs from Mercury are that it does not claim that it will provide substantially different technological services from those provided by BT.
  I deplore the Bill as a lot of nonsense which will result in the deterioration of telecommunications standards. The telecommunications manufacturing industry will be decimated, and a service which is crucial to the future of our economy and people will decline.
  9.30 pm
  Mr. Roger Stott: I have only four things to say to the Secretary of State for Trade and Industry. First, he deserves his reputation as the most studiously offensive man in the House of Commons. As to his speech, he read it—he read it badly and in any case it was not worth reading.
  We have walked a long road since the Government first introduced— [HON. MEMBERS: "Reading."]—a Bill to privatise BT. Labour Members would have walked that road much longer had they not been prevented from doing so by two completely unnecessary guillotine motions tabled by the Leader of the House.
  My right hon. Friend the Member for Bethnal Green and Stepney (Mr. Shore) systematically demolished the reasons for privatising BT, certainly on two crucial points, and my hon. Friend the Member for Stoke-on-Trent, Central (Mr. Fisher) in a contribution yesterday, which ill my view was one of the best that I have ever heard, critically analysed the so-called five reasons of the Minister for Information Technology for privatisation. He rubbished every one. They did not add up to a row of beans. They did not, and will not, stand the test of scrutiny.
  The Conservative party does not like successful publicly owned industries. The Prime Minister is obsessed with exhuming the rotting corpse of Adam Smith and dragging it screaming into the second half of the 20th century. Since her election as Prime Minister, she has continually waged a war against public enterprise which is totally unjustified, irrational and based purely and simply on her own neolithic prejudices.
  That is one reason why the Government have embarked on a series of privatisation programmes. It is political dogma and nothing else. The Government have so mismanaged the economy that the Chancellor now faces a crucial dilemma—how to reconcile the demands for

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  increased public expenditure, which is what unemployment benefit is, with the long-term commitment to lower taxation and a commitment to ensure that the Government are institutional in financial discipline.
  The medium-term financial strategy announced by the Chancellor two or three weeks ago will remain intact only at the cost of fudging the figures through the sale of public sector assets. Equally, they will remain intact only if the Government can sell assets to pay for the army of unemployed and to give tax concessions to their friends. That is the second reason why they have embarked upon a programme of privatisation. In this case they are aided and abetted by their stalking horse, Sir George Jefferson, the chairman of British Telecom, who incidentally has been using £2 million of British Telecom money, public money, to advertise the virtues of privatisation.
  The Bill marks a watershed in the history of telecommunications. The Government have progressively attacked the position of British Telecom; it had an overall monopoly under the Post Office Act 1969, then a partial monopoly under the British Telecommunications Act 1981 and now under this Bill a mere licence to continue to operate. The principle of a publicly owned and publicly accountable national telecommunication service for the benefit of everyone will end with the passing of the Bill.
  During the debate yesterday Conservative Members said that we should not mourn the passing of a golden age and that we should look forward to a new and brighter future. Fine words. What they really meant and what lay behind those words is that we should disregard the public service ethic that is the historic characteristic of British telecom and concentrate instead on the Tory principle of maximising profit for the shareholders. That has been the ethos of the debates in Committee over the last 18 months. That has been the sole motive behind all their contributions.
  The radical new philosophy envisaged by the Government can be summed up in this way. The sole criterion for investment will be the ability to generate profit, not the ability to provide a public service. That is what will happen when the industry is privatised. The Government are not concerned about whether people in the remote parts of the United Kingdom can have telephones or about whether coin boxes, an essential part of British life, will be able to remain in existence after privatisation. They are not concerned about the semi-rural person who has difficulty now. All they are concerned about is pursuing their dogma to its end and privatising one of the most successful——
  Mr. Stefan Terlezki: The hon. Member should speak for himself.
  Mr. Stott: I am speaking for myself. Who does the hon. Gentleman think I am speaking for? [Interruption.] I am conscious of the fact that the Minister of State has got laryngitis. He has told me that he cannot speak for more than a quarter of an hour; that leaves me five more minutes. The Minister of State should tell his hon. Friends that if I am to abide by the agreement I have made it would be better if I were allowed to get on with what I have to say.
  During the deliberations in Committee the Minister of State was, to put it mildly, rather disingenuous about a document produced by the unions in British
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  Telecommunications. It is called "The American Experience". It is the most well-researched and thoughtful document that I have read in all my years as a member of the Post Office Engineering Union. The evidence that has been collated by the British Telecom unions in respect of the experience in the United States should be read by Conservative Members.
  The Minister of State said in Committee that we should not pay too much attention to what is contained in the document because it has no relevance in the United Kingdom and that the example we cited of AT and T divesting itself of its local services had no relevance in the United Kingdom. He said, "Take no notice of what is said in the document, because it will not happen to us once British Telecom is privatised." I wonder whether the Minister of State has read the Wall Street Journal of 13 December 1983. If he has not, perhaps I should acquaint him with a couple of the paragraphs in it. Under the headline
  "Users Crushed by AT & T Split Must Get Subsidies, Judge Says",
  the article says:
  "Washington—The US judge overseeing the breakup of the American Telephone & Telegraph Co. urged that subsidies be provided for those unable to pay higher local telephone rates.
  'It seems clear to me that we cannot afford to leave stranded without a telephone line to the outside world those who are poor or ill or elderly, or live in isolated areas of the country,' said US District Judge Harold H. Greene."
  Judge Greene is currently hearing the case in the United States court about AT and T's divestiture of its local services.
  In case my hon. Friends do not know what this means, AT and T has decided that it will no longer use cross subsidies to support isolated communities in the United States. That will mean that those people will no longer be able to have telecommunication services. Furthermore, people will face threefold increases in their telephone bills. Everything we told the Minister in Committee is now taking place in the United States because the United States private monopoly is being broken. That is what will happen in the United Kingdom if we allow the Bill to proceed.
  I have been associated with the industry for 20 years, from the days when we were civil servants to the time of the changeover to a public corporation. The bedrock on which British Telecommunications has carried out its responsibilities has been rooted in the universal provision of a national service. British Telecom has been able to balance the conflicting pressures of profitability and the provision of a national service. The provision of a telephone to someone who is old and lonely and lives in a rural area is one of the most emancipating elements in his life. That provision has been made by the members of my union who are fiercely proud of the public service principle that has operated within British Telecommunications for the past 70 years. On their behalf, and on behalf of the millions of customers throughout the land, I say to the fat cats in the City, who hope to profit by this venture, and to anyone else who cares to listen, that upon the return of a Labour Government we shall restore British Telecom to its rightful owners, the British people.
  9.44 pm
  The Minister for Information Technology (Mr. Kenneth Baker): This is the 321st hour of debate on the Bill, which is the longest time for which any Bill has been

  1257
  debated since the war. It outdistances the long debates on the Gas Bill during Clement Attlee's Government. We are almost in sight of harbour, and one of the ironies and injustices is that the hon. Member for Newcastle-under-Lyme (Mr. Golding) has made the long speeches, but I have the sore throat.
  First, I thank all the Conservative Members who served on both Bills, especially my hon. Friends the Members for Hertfordshire, South-West (Mr. Page) and for Northampton, North (Mr. Marlow). That requires a mention in dispatches. I thank all my advisers in the Department, and my hon. Friend the Under-Secretary of State for dealing so convincingly with the detailed and complicated issues in the Bill. I also thank Opposition Members for the splendid opportunity that they have given us to discuss the merits and advantages of the measure.
  I pay generous tribute to the hon. Member for Newcastle-under-Lyme for his speeches, one of which has already reached the "Guinness Book of Records" and which is celebrated in a painting in the Upper Committee Corridor. I hope that the House will buy the drawing, by one of our police constables, and hang it in a Committee Room, not only as a solemn reminder of what can happen, but as a celebration of a unique parliamentary performance. The House should have more contemporary drawings and pictures like it. Some of the paintings that grace our walls today commemorate events which none of us can remember and few of us know anything about. I assure my right hon. Friend the Secretary of State for Trade and Industry that I am not offering departmental funds for its purchase.
  The Bill ends the long process of liberalisation, which the present Secretary of State for Education and Science started in the summer of 1980. That was a historic decision. As my right hon. Friend the Secretary of State said in his opening speech tonight, we have done more for liberalisation in two years than has happened in America in 15. We have pursued the Bill because we believe it to be in the best interests of the country. It increases consumer choice, stimulates greater efficiency, and encourages growth and innovation. That is now generally agreed, although some Opposition Members still oppose liberalisation.
  The generality of feeling in the country and in the Labour party is that liberalisation has brought undoubted benefits. It has brought considerable investment from overseas. Mitel, which is one of the leading Canadian communication companies, has built a factory in south Wales, which employs 600 people. That would not have happened without liberalisation. Comdial Communications is investing in another factory in Cardiff, which would not have happened without liberalisation. Northern Telecom, one of the great companies of Canada, has announced plans to invest in a facility in Britain to supply British and European markets. That would not have happened without liberalisation. TIE Communications of north America is also setting up in the United Kingdom, which would not have happened without liberalisation.
  Then there are the joint ventures. Ferranti has tied up with GTE to build PABXs in Manchester. This would not have happened without liberalisation. Ansafone has tied up with Nippon Electronic of Japan to build answering machines and small business exchanges in Britain. Again, that would not have happened without liberalisation. Many small companies have sprung up. In Leeds there is a fibre optic company, Photocom Systems, which produces base
  1258
  data communications. A small company in Stroud, Merlin Communications Ltd., makes call distribution equipment. In Acton, Fidelity Radio is now making cordless telephones. None of those ventures would have been started unless the Government had begun the progress of liberalisation.
  The House and the Opposition should recall that the Government did this because they were disappointed with the performance of British industry. Figures have been quoted frequently in the debate; 25 years ago British companies had 25 per cent. of the world market in telecommunications equipment, but now they have less than 5 per cent. That is a sad litany of retreat, but the retreat has been stopped and we are going ahead again. None of this would have happened had we not ended the monopoly of British Telecom.
  The Government have gone further and provided competitive networks. I remind the House that we are committed to two radio cellular networks, which will be operating by 1985. Motorola has already said that it will expand its facilities in Britain and will probably employ a further 500 people. Had BT had the monopoly, it would not have happened. The Government have granted a licence to Mercury Communications, which has already invested about £90 million and will be investing about £200 million during the next two years. That company already employs 150 people, and by 1985 it expects the figure to increase to 500. That would not have occurred unless we had granted those licences. Competition and liberalisation are good for the broad interests of Britain, not for vested interests.
  The Government have provided opportunities for a host of small companies to produce value added network services. About 88 forwarding services have been registered—40 for the provision of storage and retrieval message systems, 26 for protocol conversion, and 22 for electronic mail facilities. Those are the fruits of liberalisation, and they are real fruits. They are not like fairy gold, which disappears as soon as it is touched.
  As a result, the great sluggish giant that was British Telecom has responded. When the Government came to office the waiting list for telephones was 262,063. It has been reduced to little more than 2,000 as a result of the spur of competition. British Telecom has reduced its trunk call charges. Would it have done so if the Government had not given a licence to Mercury? No, it would not. That has benefited the customers, and I am glad to say that efficiency has been improved, with 73·6 per cent. of residential orders being met within 12 working days. By the end of 1982–83, 85·1 per cent. of faults reported were cleared by the next working day. I praise BT for that, but it was the spur of competition that produced the improvement.
  The attitude of the Liberal party and the SDP is to say, "We think that liberalisation has some advantages, but why go further to privatisation?" We cannot have a state of competition in which the largest operator in the market — British Telecom — tries to compete with other companies but remains in public ownership, with all the advantages of recourse to public money. It is a natural consequence that liberalisation must be followed by privatisation.
  I remind the House of two strong advantages of the Bill. Earlier this evening the right hon. Member for Manchester, Wythenshawe (Mr. Morris) introduced a debate on the disabled. I recognise the great work that he

  1259
  has done for the disabled in Britain, but I hope that he, too, will recognise that the Bill will improve the lot of the disabled. We shall include conditions in BT's licence—conditions 32 and 33—to ensure that the hard of hearing can obtain from BT telephones adapted to their needs. In other words, BT will be obliged to provide these telephones. There is no statutory obligation for that at the moment.
  Secondly, we have set up and are funding a research group of experts to find means to adapt the new technology for the hard of hearing. As for the blind, we shall include conditions in BT's licence to ensure that directory inquiries continue and, if charges are to be made for them, that the blind who cannot use printed directories are not worse off.
  We also want to preserve the job opportunities for the blind, and particularly for blind telephonists, because telephony has been one of the traditional ways of providing work for the blind. The new electronic exchanges do not need blind telephonists. Therefore, we have decided, in principle, that all new operator-controlled private branch exchanges should be required to be capable of adaptation for use by blind operators. This will be a major step forward and will safeguard existing job opportunities for the blind.
  I remind the House of the considerable improvement in consumer protection which the Bill provides. Under the Bill, the Director General will have powers to examine complaints. If a complaint is founded, the Director General will have the power to give directions for any abuse to be corrected. There is no consumer body in the country that has as its chairman someone who has powers of direction over the cases that he is examining and looking after. That is a substantial extension of consumer interests.
  I have also agreed to set up a national advisory board for England for consumers' interests, mirroring the existing committees for Scotland, Wales and Northern Ireland—again an extension of consumer interest. In future, and perhaps this is the biggest change in the Bill, BT's present immunity from being sued is ended. Any subscriber or customer who is fed up with British Telecom cannot now sue. In future, customers will have a contract in the same way as for any other service. This will enable them to sue BT if it does not provide the services which the contract obliges it to provide. That represnts a considerable improvement in consumer protection.
  I see the right hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Steel) in his place. The Liberals and the SDP have always favoured wider share ownership and employee participation. Tonight they have an opportunity to vote for both. They can vote for one of the greatest exercises in wider share ownership since the war, and they have an opportunity to vote for one of the measures which provides the biggest increase in employee participation since the war. The right hon. Gentleman has made many speeches advocating both wider share ownership and employee participation, but he will lead his party into the Lobby against the Bill.
  The Labour party's attitude is clearer. It is opposed to the Bill because it is a major measure of denationalisation. The Labour party has said that it will restore the monopoly if it is returned to power, in spite of the fact that such a
  1260
  restoration would almost certainly lead to lost jobs—jobs that we have created — and to the loss of investment, which we have also created.
  The Bill ends the exclusive privilege of BT. It ends the exclusive privilege of the Post Office Engineering Union to be the only union that can employ people to provide telecommunication services. It ends the monopoly of BT on equipment, services and maintenance. It ends BT's right to be the sole determinant of who should interconnect with the system, and its exclusive right to license its competitors and thereby to know their plans. It provides great new opportunities, and I am glad to say that in a moment or two it will proceed to the House of Lords. We are now on course to privatise British Telecom in the autumn of next year. That was the mandate that we had from the country in June, and it is a mandate that we intend to fulfil.
  Question put, That the Bill be now read the Third time:—
  The House divided: Ayes 313, Noes 187.

  Division No. 109]

  [10 pm

  AYES

  Aitken, Jonathan

  Clark, Dr Michael (Rochford)

  Alexander, Richard

  Clark, Sir W. (Croydon S)

  Alison, Rt Hon Michael

  Clarke Kenneth (Rushcliffe)

  Amess, David

  Clegg, Sir Walter

  Ancram, Michael

  Cockeram, Eric

  Arnold, Tom

  Colvin, Michael

  Ashby, David

  Conway, Derek

  Aspinwall, Jack

  Coombs, Simon

  Atkins, Rt Hon Sir H.

  Cope, John

  Atkins, Robert (South Ribble)

  Cormack, Patrick

  Atkinson, David (B'm'th E)

  Corrie, John

  Baker, Kenneth (Mole Valley)

  Couchman, James

  Baker, Nicholas (N Dorset)

  Crouch, David

  Baldry, Anthony

  Currie, Mrs Edwina

  Banks, Robert (Harrogate)

  Dorrell, Stephen

  Batiste, Spencer

  Douglas-Hamilton, Lord J.

  Beaumont-Dark, Anthony

  Dover, Denshore

  Bellingham, Henry

  du Cann, Rt Hon Edward

  Bendall, Vivian

  Dunn, Robert

  Benyon, William

  Dykes, Hugh

  Berry, Sir Anthony

  Edwards, Rt Hon N. (P'broke)

  Best, Keith

  Eggar, Tim

  Biffen, Rt Hon John

  Emery, Sir Peter

  Biggs-Davison, Sir John

  Evennett, David

  Bonsor, Sir Nicholas

  Eyre, Reginald

  Bottomley, Peter

  Fallon, Michael

  Bowden, A. (Brighton K'to'n)

  Farr, John

  Bowden, Gerald (Dulwich)

  Favell, Anthony

  Boyson, Dr Rhodes

  Finsberg, Geoffrey

  Brandon-Bravo, Martin

  Fookes, Miss Janet

  Bright, Graham

  Forman, Nigel

  Brinton, Tim

  Forsyth, Michael (Stirling)

  Brittan, Rt Hon Leon

  Fowler, Rt Hon Norman

  Brooke, Hon Peter

  Fox, Marcus

  Brown, M. (Brigg & Cl'thpes)

  Fraser, Peter (Angus East)

  Browne, John

  Freeman, Roger

  Bruinvels, Peter

  Fry, Peter

  Bryan, Sir Paul

  Gale, Roger

  Buchanan-Smith, Rt Hon A.

  Galley, Roy

  Buck, Sir Antony

  Gardner, Sir Edward (Fylde)

  Budgen, Nick

  Garel-Jones, Tristan

  Bulmer, Esmond

  Gilmour, Rt Hon Sir Ian

  Burt, Alistair

  Glyn, Dr Alan

  Butcher, John

  Goodhart, Sir Philip

  Butler, Hon Adam

  Goodlad, Alastair

  Butterfill, John

  Gorst, John

  Carlisle, Kenneth (Lincoln)

  Gow, Ian

  Carttiss, Michael

  Gower, Sir Raymond

  Chapman, Sydney

  Greenway, Harry

  Chope, Christopher

  Gregory, Conal

  Churchill, W. S.

  Griffiths, Peter (Portsm'th N)

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

  Grist, Ian

  1261

  Ground, Patrick

  Maxwell-Hyslop, Robin

  Grylls, Michael

  Mayhew, Sir Patrick

  Hamilton, Hon A. (Epsom)

  Merchant, Piers

  Hamilton, Neil (Tatton)

  Miller, Hal (B'grove)

  Hampson, Dr Keith

  Mills, Iain (Meriden)

  Hanley, Jeremy

  Mills, Sir Peter (West Devon)

  Hannam, John

  Miscampbell, Norman

  Hargreaves, Kenneth

  Mitchell, David (NW Hants)

  Harvey, Robert

  Moate, Roger

  Haselhurst, Alan

  Monro, Sir Hector

  Hawkins, C. (High Peak)

  Moore, John

  Hawkins, Sir Paul (SW N'folk)

  Morris, M. (N'hampton, S)

  Hawksley, Warren

  Morrison, Hon C. (Devizes)

  Hayhoe, Barney

  Morrison, Hon P. (Chester)

  Hayward, Robert

  Moynihan, Hon C.

  Heathcoat-Amory, David

  Mudd, David

  Heddle, John

  Neale, Gerrard

  Henderson, Barry

  Nelson, Anthony

  Heseltine, Rt Hon Michael

  Neubert, Michael

  Hickmet, Richard

  Newton, Tony

  Hicks, Robert

  Nicholls, Patrick

  Higgins, Rt Hon Terence L.

  Norris, Steven

  Hind, Kenneth

  Onslow, Cranley

  Hirst, Michael

  Oppenheim, Philip

  Hogg, Hon Douglas (Gr'th'm)

  Oppenheim, Rt Hon Mrs S.

  Holland, Sir Philip (Gedling)

  Osborn, Sir John

  Hooson, Tom

  Page, Richard (Herts SW)

  Hordern, Peter

  Parkinson, Rt Hon Cecil

  Howard, Michael

  Parris, Matthew

  Howarth, Alan (Stratf'd-on-A)

  Patten, Christopher (Bath)

  Howarth, Gerald (Cannock)

  Patten, John (Oxford)

  Howell, Rt Hon D. (G'ldford)

  Pattie, Geoffrey

  Hubbard-Miles, Peter

  Pawsey, James

  Hunt, David (Wirral)

  Peacock, Mrs Elizabeth

  Hunter, Andrew

  Pollock, Alexander

  Hurd, Rt Hon Douglas

  Porter, Barry

  Irving, Charles

  Powell, William (Corby)

  Jessel, Toby

  Powley, John

  Johnson-Smith, Sir Geoffrey

  Prentice, Rt Hon Reg

  Jones, Gwilym (Cardiff N)

  Price, Sir David

  Jones, Robert (W Herts)

  Prior, Rt Hon James

  Joseph, Rt Hon Sir Keith

  Proctor, K. Harvey

  Kershaw, Sir Anthony

  Pym, Rt Hon Francis

  King, Roger (B'ham N'field)

  Raison, Rt Hon Timothy

  Knowles, Michael

  Rees, Rt Hon Peter (Dover)

  Knox, David

  Rhys Williams, Sir Brandon

  Lang, Ian

  Ridley, Rt Hon Nicholas

  Latham, Michael

  Ridsdale, Sir Julian

  Lawler, Geoffrey

  Rifkind, Malcolm

  Lawrence, Ivan

  Roe, Mrs Marion

  Lee, John (Pendle)

  Rossi, Sir Hugh

  Leigh, Edward (Gainsbor'gh)

  Rost, Peter

  Lester, Jim

  Rowe, Andrew

  Lewis, Sir Kenneth (Stamf'd)

  Rumbold, Mrs Angela

  Lightbown, David

  Ryder, Richard

  Lilley, Peter

  Sainsbury, Hon Timothy

  Lloyd, Ian (Havant)

  Sayeed, Jonathan

  Lloyd, Peter, (Fareham)

  Scott, Nicholas

  Lord, Michael

  Shaw, Giles (Pudsey)

  Lyell, Nicholas

  Shaw, Sir Michael (Scarb')

  McCrindle, Robert

  Shelton, William (Streatham)

  McCurley, Mrs Anna

  Shepherd, Colin (Hereford)

  MacGregor, John

  Shersby, Michael

  MacKay, Andrew (Berkshire)

  Silvester, Fred

  MacKay, John (Argyll & Bute)

  Sims, Roger

  Maclean, David John.

  Skeet, T. H. H.

  Macmillan, Rt Hon M.

  Smith, Sir Dudley (Warwick)

  McNair-Wilson, M. (N'bury)

  Smith, Tim (Beaconsfield)

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

  Soames, Hon Nicholas

  McQuarrie, Albert

  Speed, Keith

  Madel, David

  Speller, Tony

  Major, John

  Spence, John

  Malins, Humfrey

  Spencer, D.

  Malone, Gerald

  Spicer, Michael (S Worcs)

  Maples, John

  Squire, Robin

  Marland, Paul

  Stanbrook, Ivor

  Marshall, Michael (Arundel)

  Steen, Anthony

  Mates, Michael

  Stern, Michael

  Maude, Francis

  Stevens, Lewis (Nuneaton)

  Mawhinney, Dr Brian

  Stevens, Martin (Fulham)

  1262

  Stewart, Allan (Eastwood)

  Walker, Rt Hon P. (W'cester)

  Stewart, Andrew (Sherwood)

  Wall, Sir Patrick

  Stewart, Ian (N Hertf'dshire)

  Waller, Gary

  Stokes, John

  Walters, Dennis

  Sumberg, David

  Ward, John

  Tapsell, Peter

  Wardle, C. (Bexhill)

  Taylor, Teddy (S'end E)

  Warren, Kenneth

  Tebbit, Rt Hon Norman

  Watson, John

  Temple-Morris, Peter

  Watts, John

  Terlezki, Stefan

  Wells, Bowen (Hertford)

  Thatcher, Rt Hon Mrs M.

  Wells, John (Maidstone)

  Thomas, Rt Hon Peter

  Wheeler, John

  Thompson, Donald (Calder V)

  Whitfield, John

  Thompson, Patrick (N'ich N)

  Whitney, Raymond

  Thorne, Neil (Ilford S)

  Wilkinson, John

  Thornton, Malcolm

  Winterton, Nicholas

  Thurnham, Peter

  Wolfson, Mark

  Townend, John (Bridlington)

  Wood, Timothy

  Townsend, Cyril D. (B'heath)

  Woodcock, Michael

  Tracey, Richard

  Yeo, Tim

  Trippier, David

  Young, Sir George (Acton)

  Twinn, Dr Ian

  Younger, Rt Hon George

  van Straubenzee, Sir W.

  Vaughan, Dr Gerard

  Tellers for the Ayes:

  Viggers, Peter

  Mr. Carol Mather and

  Wakeham, Rt Hon John

  Mr. Robert Boscawen.

  Walker, Bill (T'side N)

  NOES

  Adams, Allen (Paisley N)

  Douglas, Dick

  Alton, David

  Dubs, Alfred

  Archer, Rt Hon Peter

  Duffy, A. E. P.

  Ashton, Joe

  Dunwoody, Hon Mrs G.

  Atkinson, N. (Tottenham)

  Eastham, Ken

  Bagier, Gordon A. T.

  Edwards, R. (W'hampt'n SE)

  Banks, Tony (Newham NW)

  Evans, Ioan (Cynon Valley)

  Barnett, Guy

  Evans, John (St. Helens N)

  Barron, Kevin

  Fatchett, Derek

  Beggs, Roy

  Faulds, Andrew

  Beith, A. J.

  Field, Frank (Birkenhead)

  Bell, Stuart

  Fields, T. (L'pool Broad Gn)

  Bennett, A. (Dent'n & Red'sh)

  Fisher, Mark

  Bidwell, Sydney

  Flannery, Martin

  Blair, Anthony

  Forsythe, Clifford (S Antrim)

  Boyes, Roland

  Foster, Derek

  Brown, Gordon (D'f'mline E)

  Foulkes, George

  Brown, Hugh D. (Provan)

  Fraser, J. (Norwood)

  Brown, R. (N'c'tle-u-Tyne N)

  Freeson, Rt Hon Reginald

  Brown, Ron (E'burgh, Leith)

  Freud, Clement

  Caborn, Richard

  Garrett, W. E.

  Callaghan, Jim (Heyw'd & M)

  George, Bruce

  Campbell, Ian

  Gilbert, Rt Hon Dr John

  Campbell-Savours, Dale

  Godman, Dr Norman

  Canavan, Dennis

  Golding, John

  Carlile, Alexander (Montg'y)

  Gould, Bryan

  Carter-Jones, Lewis

  Hamilton, James (M'well N)

  Clark, Dr David (S Shields)

  Hamilton, W. W. (Central Fife)

  Clarke, Thomas

  Hardy, Peter

  Clay, Robert

  Harman, Ms Harriet

  Cocks, Rt Hon M. (Bristol S.)

  Harrison, Rt Hon Walter

  Cohen, Harry

  Hart, Rt Hon Dame Judith

  Coleman, Donald

  Heffer, Eric S.

  Concannon, Rt Hon J. D.

  Hogg, N. (C'nauld & Kilsyth)

  Conlan, Bernard

  Home Robertson, John

  Cook, Frank (Stockton North)

  Howells, Geraint

  Cook, Robin F. (Livingston)

  Hoyle, Douglas

  Corbett, Robin

  Hughes, Mark (Durham)

  Cowans, Harry

  Hughes, Robert (Aberdeen N)

  Cox, Thomas (Tooting)

  Hughes, Roy (Newport East)

  Craigen, J. M.

  Hughes, Sean (Knowsley S)

  Crowther, Stan

  Hughes, Simon (Southwark)

  Cunliffe, Lawrence

  Janner, Hon Greville

  Cunningham, Dr John

  John, Brynmor

  Davies, Rt Hon Denzil (L'lli)

  Jones, Barry (Alyn & Deeside)

  Davies, Ronald (Caerphilly)

  Kennedy, Charles

  Davis, Terry (B'ham, H'ge H'l)

  Kilroy-Silk, Robert

  Deakins, Eric

  Kinnock, Rt Hon Neil

  Dewar, Donald

  Kirkwood, Archibald

  Dobson, Frank

  Lambie, David

  Dormand, Jack

  Lamond, James

  1263

  Leighton, Ronald

  Redmond, M.

  Lewis, Ron (Carlisle)

  Richardson, Ms Jo

  Lewis, Terence (Worsley)

  Roberts, Ernest (Hackney N)

  Litherland, Robert

  Robertson, George

  Lloyd, Tony (Stretford)

  Robinson, G. (Coventry NW)

  Loyden, Edward

  Robinson, P. (Belfast E)

  McCartney, Hugh

  Rogers, Allan

  McCrea, Rev William

  Rooker, J. W.

  McCusker, Harold

  Ross, Ernest (Dundee W)

  McDonald, Dr Oonagh

  Ross, Wm. (Londonderry)

  McKay, Allen (Penistone)

  Rowlands, Ted

  McKelvey, William

  Sedgemore, Brian

  Mackenzie, Rt Hon Gregor

  Sheldon, Rt Hon R.

  McNamara, Kevin

  Shore, Rt Hon Peter

  McTaggart, Robert

  Short, Ms Clare (Ladywood)

  McWilliam, John

  Skinner, Dennis

  Madden, Max

  Smith, C.(Isl'ton S & F'bury)

  Maginnis, Ken

  Smith, Rt Hon J. (M'kl'ds E)

  Marek, Dr John

  Snape, Peter

  Martin, Michael

  Soley, Clive

  Mason, Rt Hon Roy

  Spearing, Nigel

  Maxton, John

  Steel, Rt Hon David

  Maynard, Miss Joan

  Stewart, Rt Hon D. (W Isles)

  Meacher, Michael

  Stott, Roger

  Meadowcroft, Michael

  Straw, Jack

  Michie, William

  Thomas, Dafydd (Merioneth)

  Mikardo, Ian

  Thompson, J. (Wansbeck)

  Millan, Rt Hon Bruce

  Tinn, James

  Miller, Dr M. S. (E Kilbride)

  Torney, Tom

  Molyneaux, Rt Hon James

  Wallace, James

  Morris, Rt Hon A. (W'shawe)

  Wardell, Gareth (Gower)

  Morris, Rt Hon J. (Aberavon)

  Weetch, Ken

  Nellist, David

  Welsh, Michael

  Nicholson, J.

  White, James

  O'Neill, Martin

  Wigley, Dafydd

  Paisley, Rev Ian

  Williams, Rt Hon A.

  Park, George

  Wilson, Gordon

  Pendry, Tom

  Winnick, David

  Penhaligon, David

  Woodall, Alec

  Pike, Peter

  Young, David (Bolton SE)

  Powell, Rt Hon J. E. (S Down)

  Powell, Raymond (Ogmore)

  Tellers for the Noes:

  Prescott, John

  Mr. Frank Haynes and

  Radice, Giles

  Mr. Don Dixon.

  Randall, Stuart

  Question accordingly agreed to.
  Bill read the Third time and passed.

  Agricultural and Horticultural Co- operation
  Mr. Speaker: Is it for the convenience of the House that the two schemes be taken together?
  Hon. Members: Object.
  Mr. SpeakerThen we must take them separately.
  10.11 pm
  The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. John MacGregor): I beg to move,
  That the draft Agricultural and Horticultural Co-operation (Variation) (No. 2) Scheme 1983, which was laid before this House on 30th November, be approved.
  Although I understand the position of the right hon. Member for Wakefield (Mr. Harrison), who shouted, "Object," in many ways it is a pity that we could not consider the two schemes together, because they are very much of a piece. Moreover, it would be for the convenience of the House if I could talk about some of the other instruments related to the capital grant schemes. However, since I must talk about the horticultural cooperation scheme first, I shall make a few general remarks to give the background. I shall then concentrate on the cooperation scheme. In the second debate I shall take up what I regard as the main subjects in relation to the agricultural grant schemes in general.
  The purpose of the instruments is to ensure changes to the farm capital and co-operation grants. They are being made to adapt the schemes to changing conditions and to give different priorities. They also reflect the public expenditure decisions taken earlier this autumn which my right hon. Friend the Minister of Agriculture, Fisheries and Food outlined in his statement on 17 November.
  For the fiscal year 1984–85, planned expenditure on agriculture, fisheries and food will be £2,256 million. That represents an increase of £437 million over our previous plans. As the House knows, there has been a need to make increased provision for the intervention board for agricultural products, particularly for intervention costs in the dairy sector. It is not appropriate for me to discuss that subject tonight, but the House will know that the Government are deeply concerned to reduce the cost of that aspect of agricultural support to products which are in surplus. That is a part of the discussions for changes to the common agricultural policy. I shall content myself by saying that we shall continue to press strongly our views in this regard within the context of the post-Athens discussions, but in the meantime we need to spend an extra £422 million on intervention products, although a large part of that is met from FEOGA and from sales out of intervention. Therefore, the £422 million is not a real figure.
  The remaining £15 million is a net increase in the planned expenditure by the three agriculture Departments. A part of that is related to the capital grant changes that we are discussing tonight and I should like to say a little about the general financial background. I shall not now deal with the individual items, as I had hoped. I suspect that the hon. Member for City of Durham (Mr. Hughes) agrees that it would have been much more logical and easy to mention the individual items before dealing with the co-operation grants.

  1265
  To play our part in contributing to the overall need to control public expenditure, we have tried to make savings in spending on capital grants. As my right hon. Friend made clear in his statement of 30 November, they amount to about £30 million in a full year. However, I should explain that, because investment is now forecast to be higher than was previously thought, total demand for capital grants is expected to lead to expenditure broadly similar to that previously planned — perhaps that has been misunderstood outside the House and in the farming community—and in line with this year's expenditure in money terms.
  One reason for the proposed changes is to make our contribution to the overall public expenditure objectives. In making them, we tried to follow through some specific and, in our view, sensible themes. I should like to deal with the three broad themes or objectives because they are relevant to the co-operation grants as many of the changes to the co-operation grants must reflect changes that we ae making in the general grant schemes. That is why, by not taking the two orders together, the issues cannot be presented clearly. I shall outline those three objectives and explain them in greater detail in the next debate. The first is that we have had conservation needs firmly in mind. Secondly, we have laid special emphasis on changing needs and up-to-date priorities. Thirdly, we have given priority to changes when administration of the schemes can be simplified and when administrative savings can be made.
  Perhaps it would be helpful if I now said a little about the changes to the co-operation grant. The Agriculture Act 1967 provided authority for a scheme of grants which were designed to encourage, promote or develop any form of co-operation in agriculture or horticulture. Since then, successive Governments have operated an agricultural and horticultural co-operative scheme that, although modified on several occasions, has offered to agricultural and horticultural co-operatives financial assistance towards formation costs, including feasibility studies and initial managerial salaries, and grant on a wide range of capital investments.
  The Government recognise that producers who combine their resources through co-operation can achieve benefits of scale that are unavailable to individual producers. Co-operation also assists producers to identify opportunities in the market and to fulfil those demands by supplying a product that is consistent in quantity and quality to satisfy customer requirements.
  From the many visits that I have paid to co-operatives in the last few months, I have become increasingly aware of the importance, if we are to sell our products at home and overseas, of putting an emphasis on quality, and cooperatives help us to do that.
  The Government, therefore, remain committed to the principle of producer co-operation, but this sector, too, cannot be immune from changes in the financial level of support if one considers that there are higher priorities elsewhere.
  The amount of grant awarded under this scheme has virtually doubled over the last two years and is now running at some £4,500,000. That is a sizeable and positive commitment. The draft statutory instrument before the House amends the agricultural and horticultural co-operation scheme to reflect broadly the changes being introduced into the farm capital grant schemes that we shall be considering later.
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  While grain co-operatives will still qualify for grant, however, we have decided that there shall be some reductions from the present levels. Thus the rate for building and associated works is being reduced from 22½ per cent. to 15 per cent., and for plant and equipment used for the storage and drying of grain the rate will be 10 per cent. instead of 15 per cent. The small and relatively unused grant of 5 per cent. when such equipment is used by a co-operative on individual farms is being deleted.
  For co-operative buildings other than grain, we are retaining the present 10 per cent. per premium over those available to individual farmers under the AHGS. This involves a small reduction in grant from 32½ per cent. to 30 per cent. Under the farm schemes, grant will no longer be available for production and harvesting machinery, and to reflect this pattern consequential changes are being made to the co-operation scheme. On those items eligible for grant, we are maintaining a premium for co-operative investments. As I said, my visits to several co-operatives in recent months have confirmed my view that the grants are well used and can make a significant contribution towards the better grading and marketing of farm produce.
  To those who query the justification for continuing to grant-aid cereal co-operatives, I should point out that the effect of the proposed amendments together with those made during the summer in a Committee upstairs will be to reduce grants in the cereal sector by more than one half.
  We have to make these consequential changes. but I was anxious to keep them to the minimum because, as some hon. Members may know, I have asked the Cooperative Development Board of "Food From Britain" to examine its priorities and strategies. I hope to be discussing these with the chairman, Mr. Douglas Cargill, in the coming months. If there are to be any further changes—and I make no commitment about that in advance of these discussions it could be that there will be none — I think it right to await the outcome of the board's deliberations.
  In mentioning the Co-operative Development Board, I am able to say that in the co-operative sector as elsewhere, as I shall demonstrate later, we have taken the opportunity of the changes to make one improvement that reflects current priority.
  The Co-operative Development Board has made clear to us its belief that one of its top priorities is that more resources should be devoted to the non-capital grants section of the AHCS, grants which are currently limited to a financial ceiling which, in 1983–84, stands at £250,000. The board considers that these grants, which go towards the cost of forming new co-operatives and the employment of key managerial staff or marketing agents, play an important part in ensuring that a new producers' group starts off on the right lines and enhances the longterm prospects of the business.
  It urged that if there were any additional resources available, they should be devoted to that purpose. I agree, and I am happy to say that we intend to increase the present ceiling by £200,000 in each of the next three financial years, and I know that that has been welcomed by the board.
  That, in broad outline, is what the draft statutory instrument does. The draft instrument, that we shall be discussing next, together with the other changes that we are making, are more material, and I shall comment on those when we come to that debate. Meanwhile, I commend this draft statutory instrument to the House.
  10.27 pm
  Mr. Walter Harrison: I had expected a representative of the Opposition Front Bench to speak on this matter, and I received no indication that that would not be the case. However, I welcome this opportunity to speak about this instrument because I tried to discuss it on several occasions earlier in the day with Opposition Front Bench spokesmen on the subject and to explain my situation, but without success.
  As I listened to the Minister I thought that there was nothing in the measure relating to the subject that I wished to raise. However, there is provision in the instrument for flood protection works and the protection or improvement of river banks. [HON. MEMBERS: "Wrong measure".] If I am out of order, the Chair will inform me of that fact. Indeed, I have already been called to order, as it were, by the occupants of my own Front Bench in that they have not talked to me today about the subject.
  For nearly six months Wakefield has been flooded. Because 400 homes were flooded earlier this year, on 1 June I spoke to the then Under-Secretary of State for the Environment, now the Under-Secretary of State for Energy — we have a quick changeround under the Conservatives—and he told me, "I will deal with the flooding in your constituency," and he referred me to the Yorkshire water authority.
  Within a few weeks we had the general election, after which I took the matter up with the present Minister for Housing and Construction. It is amazing how quickly I go through Ministers, just as I go through chairmen of water authorities. Within six months I have dealt with three Ministers and three chairmen of the Yorkshire water authority, all about the same subject. The reason why I am not receiving support on this issue from my Front Bench is that I have been raising the matter, without success, since 1970. [Interruption.] Does any hon. Member wish to intervene in my speech? I am willing to give way; I am a tolerant sort of chap.
  I am thinking of a golfer who played a round at Low Laithes golf course in Wakefield. Golfers in the House may know it. He knew that he had got a hole in one because when the ball went into the hole it went "plop"; the hole was full of water. As he progressed round the course, he found that the 16th, 17th and 18th greens were all low-lying and under water.
  Half a mile away, people's homes were flooded. They were not holing in one. They were trying to get the water out of their cellars. Then disaster struck. In the Lofthouse colliery disaster seven men, all from the same area, lost their lives. The water broke through and cost those men their lives. In the early 1970s, when I asked the golf club secretary about the 16th, 17th and 18th holes he said that there was no problem any more because the water had all gone into Lofthouse colliery. So the problem has existed for a long time.
  The M1 extension was built in 1968–69. Since then there has been a catchment area problem under the Land Drainage Act so that the problem has not been dealt with either by the Yorkshire water authority or by the Department of the Environment.
  This is the only opportunity for me to discuss flooding in Wakefield. I rang the Minister of Agriculture, Fisheries and Food at 9.30 am last Sunday. One has to be quick off the mark in these matters. I asked the Minister whether I had got him up, but he said that he was still in bed—
  1268
  reading the News of the World, no doubt. [Interruption.] The hon. Member for Macclesfield (Mr. Winterton) is wrong to doubt my words.
  Mr. Nicholas Winterton: I was there.
  Mr. Harrison: The hon. Gentleman says that he was there, but I doubt it.
  Mr. Winterton: Do not worry—I was not there.
  Mr. Harrison: I am glad that the hon. Gentleman has withdrawn that comment.
  After vigorously pursuing the Minister in charge for 13 years I find that the only opportunity to raise the matter is on item No. 9—of the wrong measure, according to the Opposition Front Bench, so it will have to be item No. 7 on the other measure. The provision relating to flood protection provides the only opportunity.
  In Committee Room 10 in 1972–73 I watched Graham Page—one of the best Ministers that the Conservatives ever had — rush legislation through setting up the counties and metropolitan authorities. The Conservatives made a big mistake then. They now intend to correct it. How does one describe a mistake added to a mistake? The banks have a word for it. [HON. MEMBERS: "Compound."] That is the word. The Government are now going to compound their mistakes. The counties and metropolitan districts were given gums without teeth.
  When the flooding occurred in Wakefield I asked the metropolitan district council who would deal with it. I explained that I had 400 constituents with wet ankles—not golfing, but trying to pump out their homes. More sandbags are sold in Wakefield than anywhere else in the country—the situation in 1945–48 has nothing on us. A few years ago 400 people were affected. In June there were 800. On 9 December there were more than 1,000. When I visited the metropolitan district council, the county council and the Yorkshire water authority, I realised that Wakefield met carried the can. I spoke to the chairman of the Wakefield metropolitan council, with whom I served about 30 years ago. I said, "Now Jack, who will deal with the flood?" He said, "I cannot do anything about it, Walter, as we have no money. It is not our responsibility."
  I then visited the county council. I knew the people there, as I had served as a member of the authority. I said, "Now Rodney, what about this job? Some of my constituents are flooded. Who will deal with the problem?" He said, "We cannot do anything about it as we have no money." I then visited the chairman of the Yorkshire water authority, who said, "We have no authority to help. It is not our responsibility." I then went to the Department of the Environment, where I met the present Minister for Housing and Construction, a well-informed and knowledgeable man. He was the Prime Minister's previous Parliamentary Private Secretary. He said that it was a matter for Wakefield metropolitan council. When I was returning to Wakefield, I felt like the Oozelum bird. I was going round and round.
  I am now with the Minister of Agriculture, Fisheries and Food. I had a chat with him on Sunday morning and another chat with him at 4 o'clock today. When we finished at 4.45 pm he said "Permissive powers." The position is that thousands of people are flooded out in Wakefield. I have discovered that not one person to whom I spoke has the power to authorise remedial work or will help in any way.
  Are you listening, Mr. Deputy Speaker?
  Mr. Nicholas Winterton: If he were, the right hon. Gentleman would be ruled out of order.
  Mr. Harrison: That is right. I appreciate that you are tolerant, Mr. Deputy Speaker.
  I am concerned about my constituents. No-one is willing to carry the can. I am trying to include a clause to enable us to pin down the responsibility.
  I declare my shot. I have told the Minister that the war is on. Wherever water is involved, be it in agriculture, horticulture density, depth or whatever, I shall discuss this problem because thousands of my constituents are suffering. I shall divide on every order.
  Mr. Deputy Speaker (Mr. Harold Walker): The right hon. Gentleman sad that I was tolerant. Indeed I am. I have been waiting patiently for him to tell me how his grievous flood problem in Wakefield relates to
  "approved proposals designed to promote co-operative activities in agriculture or horticulture."
  I hope that the right hon. Gentleman is about to bring his remarks to a close, or show the House how they relate to the order before it.
  Mr. Harrison: I thank you, Mr. Deputy Speaker, for being so tolerant. I was having the same difficulty as you as to where to get in. I was told that if I made my speech I would immediately be out of order. Even so, I have been speaking for 10 to 12 minutes. I am amazed.
  If any item before the House deals with the provision or improvement of flood protection works, protection or improvement of river banks or facilities to prevent the flooding of agricultural land by water courses, I reckon that I am in.
  Mr. Deputy Speaker: The order relates to those matters only in connection with co-operative activities in agriculture or horticulture. If the flooding in Wakefield is relevant to the co-operative activities in agriculture or horticulture in Wakefield, the remarks of the right hon. Gentleman may be relevant. If not, the right hon. Gentleman must bring his remarks to a close.
  Mr. Harrison: But they are relevant. The wife of my right hon. Friend the Member for Barnsley, Central (Mr. Mason) came to visit me last week—[HON. MEMBERS: "Oh."] Rather, she came to visit my wife. When she looked out of our front window, she had a wonderful view of three lakes belonging to a farmer——
  Mr. Nicholas Winterton: The landed gentry.
  Mr. Harrison: One consisted of 10 acres of land. I do not know whether barley is grown there, but whatever it is, it is green——
  Mr. John Home Robertson: Rice.
  Mr. Harrison: That is next year—[HON. MEMBERS: "Order."] I am glad that hon. Members have called me to order. My point is that, when confronted with problems such as this, and you start amending regulations——
  Mr. Deputy Speaker: Order. The right hon. Gentleman has been in the House a long time and knows that it is not I who make these amendments.
  Mr. HarrisonWe used to serve together, Mr. Deputy Speaker. However, I am not taking advantage——
  Mr. Home Robertson: My right hon. Friend now has an office.
  Mr. Harrison: I do, but it was a Tory office. I can talk about accommodation if my hon. Friend wishes.
  Sir Peter Mills: Perhaps I can help. The way forward is to form a co-operative to deal with drainage, as a result of which grants may be available to deal with the problems in the right hon. Gentleman's constituency.
  Mr. Harrison: I thank the hon. Gentleman for that advice. Those who have suffered from flooding have formed a co-operative because as riparian owners they could not afford the work on their own. They formed that co-operative to satisfy the insurance people. I shall, however, take the hon. Gentleman's advice back to my constituents. I am willing to accept any further advice that he may be able to give, and perhaps he will see me at the back of the Chair.
  I looked up the Agriculture Act 1967 and discovered that water is mentioned nowhere. There is no reference to flooding in sections 58, 59, 60, 61, 62, 63 or 64.
  I raise this matter now because I am disappointed with the replies that I have received in the last six months from the various Departments, including the Department of Transport which is responsible for the M1 catchment area. Even the Land Drainage Act 1961, amended in 1976 and subsequently, does not deal with this problem.
  I had a few chats with a comrade of mine, Mr. Graham Page——
  Mr. Home Robertson: And a pint.
  Mr. Harrison: You have as well——
  Mr. Deputy Speaker: Order. I have never had a pint with Mr. Graham Page.
  Mr. Harrison: If you have not had a pint with him, Mr. Deputy Speaker, you have been there when he has had a pint with me. Be that as it may, I do not wish to be distracted.
  There is a defect in the legislation when flooding cannot be dealt with by the metropolitan district, by Yorkshire county council, by Yorkshire water authority, by the Department of the Environment or by the Ministry of Agriculture because permissive powers are involved. Why do ratepayers pay rates for these things when the service cannot be carried out? Can the Minister tell us where the responsibility lies for dealing with flooding in Wakefield.
  10.45 pm
  Mr. MacGregor: The House has great affection, as have too, for the right hon. Member for Wakefield (Mr. Harrison). I was forced to keep in order in my original remarks about the order. What the right hon. Gentleman was saying was not quite relevant, because arterial drainage is not covered in the order. Nevertheless, understand his concern and I hope that he accepts that my right hon. Friend the Minister of Agriculture, Fisheries and Food responds quickly, even at an early hour on Sunday, not only because of his old friendship with the right hon. Gentleman and his recognition of all he did to make the workings of the House possible but also because of his concern to help. I hope that the right hon. Gentleman will agree that the Minister responded quickly by seeing him this afternoon.
  It is for the district council to decide whether or not to initiate new drainage work to alleviate the problem. However, if it will help, my right hon. Friend is

  1271
  considering what he can do to help and he will write to the right hon. Gentleman shortly. I hope that the House will now agree to the draft order.
  Mr. John Home Robertson: Does not the Minister agree that there is a relationship between his responsibility and what my right hon. Friend has been talking about? The schemes that we are debating encourage farmers to improve the drainage of their land which makes the water run off the land faster. This means that rivers like the one that we have been hearing about in Wakefield and others in my constituency and elsewhere are bursting their banks much more often. There is a relationship and there should be better liaison between the Ministry of Agriculture and the other Departments such as the Scottish Office and the Department of the Environment.
  Mr. MacGregor: That is very ingenious, but it has little to do with the draft order that we are debating. I have already said that my right hon. Friend will be considering the matter on the right hon. Gentleman's behalf. I hope that we can proceed to approval of this order and get on to the main order.
  Question put and agreed to.
  Resolved,
  That the draft Agricultural and Horticultural Co-operation (Variation) (No. 2) Scheme 1983, which was laid before this House on 30th November, be approved.

  Agriculture and Horticulture Grant
  10.48 pm
  The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. John MacGregor): I beg to move,
  That the Agriculture and Horticulture Grant (Variation) (No. 3) Scheme 1983 (S.I., 1983, No. 1764), dated 29th November 1983, a copy of which was laid before this House on 30th November, be approved.
  I have already outlined the background and indicated that one of the reasons for the changes being proposed —this order contains the major ones—is to enable the Ministry of Agriculture, Fisheries and Food to make its contribution to the overall public expenditure objectives.
  Taken together, all the changes relating to capital grants which we are discussing tonight are fairly detailed. I should like to refer to one or two others which are outwith the main order but which are relevant to the overall concept of the changes we are making, although I shall not now refer to the co-operative ones, as we have already dealt with them.
  Although there are a large number of detailed changes, I believe that there is logic in what we are doing. I should like briefly to refer again to the three objectives and then deal with the details. First, we have had firmly in mind the conservation needs; secondly, we have considered the changing priorities; and thirdly, we have had in mind in making the changes the importance of administrative savings where particular schemes have an unduly high administrative, bureaucratic or complex cost.
  Let me now illustrate these themes by reference to the changes. First, on conservation, I hope that it will be as welcome to the House as it has been to the public at large that, within the comparative limits of this exercise, we have put the needs of environmental conservation firmly to the fore. It is for that reason that walls and hedges in the upland areas will now be eligible for a higher grant rate of 60 per cent. and I hope that this encouragement will further persuade farmers and landowners to build or improve good and attractive traditional walling and to establish hedgerows.
  The same higher rate of grant will apply to shelter belts of trees provided in the upland areas. We have also taken this opportunity to end once and for all any grant payment for the removal of hedges in England and Wales. It has long been the policy not to give grant-aid for the removal of hedges where they formed field boundaries, but until now it has been possible to claim grant on the minimal amount of grubbing which may have been necessary to achieve the full benefit of the eligible operation — a drainage scheme for example. We have come to the conclusion that this is no longer justified and I can therefore state quite clearly that hedge removal for whatever purpose, if the order is approved tonight, will no longer be eligible in England and Wales for capital grants.
  Secondly, I come to our desire to reflect our change in priorities. Here in particular we have decided to cut back on grant availability for those sectors which are in surplus and which we are particularly discussing in the post-Stuttgart proposals in relation to reforms in the Community regimes, while devoting additional resources out of some of these savings to agricultural sectors in particular difficulty. I believe that the House will consider that this, too, makes sense.

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  I should like to take the first part of that proposition first —cutting back on areas in surplus or where there is no longer the same need. I am sure that there is a general view that agriculture cannot expect to avoid making its contribution to overall Government savings in current conditions. We have therefore concentrated on those sectors which we believe can most sustain such savings, and that is why we have decided to discontinue grants in connection with grain drying and storage facilities, where the grain is to be used off the farm. This is both because the cereals sector is undoubtedly more healthy than other sectors of agriculture and because there has been a considerable increase in the provision of such facilities in recent years.
  That is also why the instruments provide that there should be no grant-aid of any type, apart from land works which directly benefit a dairy enterprise with 40 or more dairy cows or a pig enterprise with more than 550 places. In addition, to achieve the level of savings required, we have decided to reduce the basic rate of grant for building and land works excluding drainage from 22·5 to 20 per cent. Orchard replanting will remain at its initial level of 22·5 per cent.
  In doing that we have resisted making substantial cuts in such crucial areas as field drainage in the less favoured areas of the country. Indeed, we have maintained a marked margin of preference in the LFA grant rates compared with those in the lowlands. We have always considered that land drainage is one of the most useful and rewarding activities a farmer can undertake, and I am sure that the House will be pleased to know that we have been able to maintain substantial grant assistance in this area. The standard rate for field drainage will now be 30 rather than 37·5 per cent., but this is still 50 per cent. higher than the basic rate of 20 per cent. and it will be 60 per cent. in the less favoured areas rather than 70 per cent.
  I should like now to deal with the second part of the proposition, the areas where we have increased support.
  The House will recall—certainly my hon. Friends will— that in our election manifesto we promised to help the glasshouse industry to make better use of energy for glasshouse heating. The instruments before the House provide for substantially increased assistance to glasshouse growers for investment in energy saving facilities.
  In recent years our growers' returns have been seriously reduced by the competition, much of it unfair, which our industry has had to face until recently. The root cause of the unfair competition — the Dutch preferential state-aided gas tariff for horticulturists— has been removed. But the squeeze on profit margins has prevented our growers from matching the capital investment of for example, the Dutch, in modern methods of improving the use of energy in glasshouse heating.
  Under the measures, the grant rates for the replacement of heated greenhouses and improvements to existing structures, including thermal insulation, are increased to 37·5 per cent. under the agriculture and horticulture grant scheme, and to 50 per cent. under the agriculture and horticulture development scheme. Further, because of the exceptional circumstances of this sector, we are increasing the present six-year ceiling under the agriculture holdings grant scheme on the amount of investment which can qualify for grant by about £30,000, where this extra investment is wholly incurred for eligible energy-saving facilities. Grants will be retained at the previous levels on plant and equipment used for glasshouse heating,
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  including boilers, although the ability to obtain grant-aid on similar items for heating general agricultural buildings will end with the removal of plant and equipment from the schemes. Here, too, we have preferentially singled out the glasshouse sector. We estimate that the increased help will be worth about £2 million a year to the industry.
  Those measures demonstrate the importance which the Government attach to promoting the conditions needed to sustain a healty and prosperous glasshouse industry. The removal of the source of unfair competition, the encouraging initiatives which "Food From Britain" and the industry have taken to improve marketing, and the increased grants to encourage the better use of energy will give the industry a real opportunity to become fully competitive. I hope that growers will take full advantage of it.
  In the same context of additional help to sectors in need, I refer next to another useful change made by the instruments before the House tonight—the payment of less favoured area benefits to the marginal areas. When my right hon. Friend the Minister announced the present changes, he said that once the marginal areas had been given less favoured area status by the Community they would become eligible for the less favoured areas rates of capital grants, with the exception of roads, grids, bridges and such like, for which the standard rate would apply. He also mentioned that we hoped to introduce headage payments at about half the rate of the present less favoured areas rate, although this would have to be determined in the autumn 1984 review.
  We are looking forward to introducing the measures. However, to do so we must surmount the Community hurdles, and we have been arguing this case at every Agriculture Council meeting for the past few months. We cannot act until then, but in the meantime I am sure that this advance news of our intentions will be welcomed as firm evidence of our commitment to help marginal farmers as soon as possible.
  The third general objective has been to make changes in grants where we believe that they are the least cost effective, or where the costs of administration and the complications can be out of relation to the benefits achieved. For that reason, we have decided to remove grant-aid for all machinery and fixed plant and equipment, with the exception of certain horticultural items.
  At the same time, it seemed reasonable to exclude fixtures and fittings from the grant-aidable cost of a building or glasshouse, because the dividing line between equipment and fixtures and fittings is very fine and not at all easy to define. I know from experience of cases brought to my notice that there can be much argument over comparatively trivial items such as drinking bowls or feed hoppers. This change, which confines grant-aid to the roof, walls, floor and integral internal walls of a building, will dispense with such arguments and will, I trust, make this wide area simpler to understand and easier to administer. At the same time, we shall continue to assist farmers to provide good quality buildings which are capable of being adapted to changing needs and techniques. The House should not underestimate the benefits which can accrue from simplification. For example, I was astonished to find that the simplification of the farm capital grant scheme following the Rayner review was estimated to save £2 million a year at 1979 prices and to reduce staff numbers by about 400. I would

  1275
  not claim that the present changes will produce such dramatic results, but they represent sensible, modest changes and I commend them to the House.
  In the same vein, the removal of some grants, such as those for grain storage facilities for sale off farm, and for large pig and dairy enterprises, will make administrative savings.
  I realise that I have had to go into some detail, but unfortunately the grant schemes are extremely complex. Those are the broad themes which I have endeavoured to bring out. Perhaps I should now make it clear that the major changes in the package relate to the national grant scheme. Those to the two Community schemes and the cooperation scheme are mainly consequential, their amendments being confined to those necessary to ensure equality of treatment across the board.
  In broad detail, that is what the statutory instrument and the other consequential changes do. They represent a fair deal in the context of public expenditure objectives, making agriculture's contribution to the need for overall savings, but in a way that does not harm the legitimate or crucial interests of the industry, and as a package sensibly reflecting changing priorities and needs. I commend the statutory instrument to the House.
  11 pm
  Mr. Mark Hughes: I apologise to you, Mr. Deputy Speaker, and to the House if anything that I have done has offended my right hon. Friend the Member for Wakefield (Mr. Harrison). I had assumed that when we came to discuss these instruments, we would discuss them together, and the major problem of the diminution of drainage grant comes up on this motion rather than on the previous one. That is why I did not seek to catch your eye, Mr. Deputy Speaker, on the cooperation motion, although I shall say something about it.
  As the Minister has made clear, the first reason for these changes is to do with the Treasury, which wants a cut in the money being spent. Had the Treasury not wanted that, few, if any, of these changes would have been introduced, although there may have been minor modifications at the edges for administrative reasons. In many respects, the Opposition welcome the choices made by the Minister. For example, we welcome the improvements in walls and hedges in upland areas, and the the cessation of any grants for the grubbing-up of hedges. We welcome the removal of grant from grain storage from off-farm sales. If the Government are forced to make cuts, we accept the line that they have taken. Equally, we welcome the incentives and assistance given to the hard-pressed glasshouse industry to go in for investments.
  However, the one thing that sticks in our craw is drainage. Major arterial work is being done that upsets the water table over many parts of Britain. Therefore, there is an essential consequential need for farm drainage to be encouraged because the rate of water run-off is being altered. On this, I am in complete agreement with my right hon. Friend the Member for Wakefield. At this point, the inter-relationship between the Department of the Environment, the water authorities and the Ministry of Agriculture, Fisheries and Food has become out of kilter.
  We are encouraging arterial land drainage by water authorities — quite rightly and properly — but as a consequence, we are causing unacceptable problems for
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  farmers and ordinary householders. Faced with that, the Government are seeking to reduce the land drainage subsidy, and because of that, were we able to isolate that element in these instruments from the parts of them of which we approve, we should seek to divide the House. We are wholly dissatisfied with the reduction in grant for land drainage.
  Like my right hon. Friend the Member for Wakefield, I shall adduce a constituency point. About three quarters to four fifths of the plastic agriculture land drains now produced in this country are made in my constituency by Waven Plastics. My constituency, therefore, is at risk of losing many jobs. I mention that only as a constituency interest. It is unimportant, compared with the national problem. We must many the relationship between agriculture drainage, arterial drainage and the water table in much of eastern England, if we are to avoid the Lincoln floods of which we heard at Question Time earlier today, or the Wakefield flood problem.
  Although we believe that the Minister has made a skilled choice overall—with one exception—in meeting the demands of the Treasury for cutbacks, and we welcome what he said about walls, hedges, shelter belts, and grain silos for off-farm sales, I earnestly urge him to look closely—even though we cannot divide against it tonight—at the reduction in the drainage grant in the lowland area. Many hundreds of miles of tile drains which are obsolescent—if not obsolete—need to be replaced. With adequate drainage many new areas of land could be brought into more productive use. To reduce the grant for drainage not only causes the problems that were adduced by my right hon. Friend in the Wakefield area but does major mischief to the opportunities for British agriculture.
  I therefore hope that the Minister, in the same spirit as that in which we welcome the instruments in general, will look again at the drainage problem.
  11.9 pm
  Mr. John Farr: I welcome loosely what my hon. Friend said about these two schemes. I am convinced that sensible economies should be made. Nevertheless, I seek enlightenment from him on a couple of matters.
  On the second scheme, can my hon. Friend tell me what happens to schemes that have been completed before the cut-off date of 1 December 1983, although the application for grant-aid went in after that date? If an applicant went ahead with a substantial drainage scheme or a farm improvement scheme or a grain drier improvement scheme and made his calculations on the former rate of grant, I imagine that, even although his application of grant was submitted after 1 December, provided that the works were commenced before 1 December, the old rate of grant would apply. I hope that my hon. Friend will comment on that.
  I know that my hon. Friend has been in his Department for some time now, and that during those months he has paid close attention, to my certain knowledge, to all the inner workings of the Department. Therefore, he can tell me at once what the fate will be of a department within the Ministry that is called the Weed Research Department. My hon. Friend the Member for Norfolk, South-West (Sir P. Hawkins) laughs, but the department is an important one. It employs only a few specialists, but for many years it has done a great deal of sophisticated research work into weed problems. I can assure my hon. Friend that some of

  1277
  the Norfolk broads would not be as clean, fresh, pure and fast running as they are were it not for the continued research and work of the department. It employs six or eight specialists and I should like to know what their fate will be. Will the department continue, or will it at least be maintained at its present level. It will be of great help to my constituents and myself to know what fate holds in store for the department. Many of my constituents have learnt to respect the activity of a small but sophisticated department within the Ministry.
  My hon. Friend the Minister has said that he is seeking to make agriculture more in line with conservation needs. We probably all think that that makes sense. Surely the day must be long passed when agriculturists sought to extract the last ounce of grain or, in effect, the last pint of milk from an acre. If the price to pay for that extraction is an environment which is lower in quality, that extraction is entirely wrong and out of tune with public opinion.
  I welcome the proper emphasis that my hon. Friend placed upon conservation and some of the changes that he has made, such as abolishing the grant which was available for pulling up hedges. I must confess that I thought that the grant for the removal of hedgerows had been removed some years ago by my right hon. Friend the Member for Waveney (Mr. Prior), who is now the Secretary of State for Northern Ireland. Probably the grant crept back in like many of the bad things that accompany our membership of the EEC. I am glad to know that once again the problem has been tackled energetically and that the grant that was available for the removal of hedgerows, which we all thought was a bit of an abortion, will no longer be a possibility.
  My hon. Friend the Minister has stressed the changing needs of agriculture and stressed, too—I was glad to hear this—the need for simplification. Surely both sides of the House are with him 100 per cent. on that score. I wish to emphasise what the right hon. Member for Wakefield (Mr. Harrison) said about land drainage and all its associated problems. We cannot tinker with one part of land drainage without having an effect on the entire chain. It is all very well to say that the land drainage grant should be reduced or that some change should be made in the grant which is available for land drainage for farmers and agriculture, but such changes have a great effect further down the line.
  I shall give a twofold illustration from my constituency. In one instance, a farmer drained a great deal of land and achieved a rapid run-off. In the following two years, until a flood alleviation scheme was introduced, a village downstream was flash flooded in the summer for the first time in living memory. The other point—and it must not escape the attention of the House— is that when the farmer did not get a grant for a drainage scheme and no drainage improvement work was carried out, another village was still flash-flooded twice in the summer months because of the run-off from a new development.
  Mr. Nicholas Winterton: Hear, hear.
  Mr. Farr: I am glad to have the support of my hon. Friend. There can be a chain reaction, and what is done by one Department can have a damaging effect on the quality of life all over the country and can closely concern another Department.
  I welcome the schemes.
  11.16 pm
  Mr. Geraint Howells: I endorse the sentiments of the hon. Member for Harborough (Mr. Farr) about the right hon. Member for Wakefield (Mr. Harrison), who made a most inspiring speech. He made a plea on behalf of many of his constituents which received a sympathetic hearing from hon. Members on both sides of the House. I hope that he will go back to Wakefield——
  Mr. James Molyneaux: Born again.
  Mr. Howells: No, not born again. I am sure that the right hon. Gentleman will have been successful in helping those in need in his constituency.
  Farmers, and those who believe in the countryside, will welcome many parts of the scheme. Many will welcome the increased help for drystone walling and hedge laying, which will help farmers to improve the environment in many parts of the country. The increases apply only to the less favoured areas. I wonder whether the Minister can comment on whether the Government will be willing to extend them to the marginal land area in 1984, when grants are to be made available to the marginal land, according to his forecast. I also welcome the assistance for glass houses.
  The charges related to marginal land are important, but I stress the importance of the British application to have the designation accepted by Europe. I accept that the Minister spoke in good faith, but I am worried that he will not get the blessing of his counterparts in Europe, and I doubt whether the grant aid will be given to those in the marginal land area in 1984. Perhaps the Minister can give that assurance when he winds up, so that the farmers, when they hear the good news that he has given us, will farm during the next 12 months with the confidence that they are to get the extra aid from the Government in 1984.
  Many farmers and members of the NFU and of the Farmers Union of Wales have expressed concern about the £30 million cuts in the agriculture and horticulture fund. Will the estimated figure of £30 million that has been bandied about be the net loss to agriculture and horticulture during the coming year?
  11.18 pm
  Mr. Nicholas Winterton: I shall speak as briefly as the hon. Member for Ceredigion and Pembroke, North (Mr. Howells).
  I welcome the general tenor of my hon. Friend the Minister's remarks. He has started a long overdue rationalisation of the grant system, and it will be generally very welcome. I am particularly interested in his emphasis on conservation. His announcement made it clear that the measures are to be limited at the moment, but, like the hon. Member for Ceredigion and Pembroke, North, I hope that, the measures about walls and hedges will be extended beyond what has been announced tonight.
  Many of us are deeply concerned about the environment, both in the highlands and marginal land and in the ordinary agricultural areas. We believe that assistance should be given to people who are prepared to preserve walls and hedges for the benefit of the environment and wildlife. They maintain the balance of nature. Unfortunately, that balance has been greatly upset recently. The farming industry has a responsibility to retain, maintain and preserve the heritage of the

  1279
  countryside for future generations. My hon. Friend the Minister has gone some way to ensure that, and I commend him for it.
  The right hon. Member for Wakefield (Mr. Harrison) made a speech which I thought was totally out of order, but you, Mr. Deputy Speaker, preside over the House and I entirely accept the discretion which you operated. As the hon. Member for Ceredigion and Pembroke, North said, the right hon. Gentleman did the House a service in presenting the problems of flooding that have affected his constituency. Hon. Members tend to overlook the problems associated with the development of land drainage in agricultural holdings and agricultural development. My hon. Friend the Member for Harborough (Mr. Farr) mentioned such problems and, from a sedentary position, I indicated assent to his point.
  Permission to develop is often given by planning authorities without any thought for the land drainage problems which result from such development. If people put houses or tarmacadam roads on agricultural land, its natural drainage is upset — water is sent into a much narrower channel. Proper thought is often not given to such considerations. The result of such developments is flash floods, which my hon. Friend the Member for Harborough, the right hon. Member for Wakefield and the hon. Member for City of Durham (Mr. Hughes) mentioned.
  It is unfortunate that the Government have reduced the amount of grant-aid that is available for responsible land drainage. It is one of the most important aspects of the instrument. I hope that, in response to the debate, my hon. Friend the Minister will be a little more forthcoming with regard to what the right hon. Member for Wakefield said. In my constituency, the planning authority and even my farmers, who generally support the Tories 100 per cent. at election time, have created drainage problems which affect urban areas. Such problems were dramatically illustrated by the right hon. Member for Wakefield.
  Planners do not fully understand drainage and it is often not fully understood by farmers, who rightly want to create the circumstances in which they can get the maximum return and profit from the land which they farm. The Government and the EEC have urged them to do that. The water which comes off that land, whether by the plastic land drains which the hon. Member for City of Durham mentioned or by the system which created the problems in Wakefield, has not been considered when agricultural, industrial or housing development has taken place.
  I make this plea to my hon. Friend, whose understanding of the situation is profound, as he demonstrated in his remarks. Will he give further consideration to the matter? The problems that have been highlighted may to some extent have been out of order in the debate, but they are relevant to agriculture and to the countryside. Will he look at these problems again to see whether any modification needs to be made to his statement? It has support from both sides of the House, but it may lack a degree of understanding, as was pointed out by my hon. Friend the Member for Harborough, the right hon. Member for Wakefield and the hon. Member for City of Durham.
  I have experienced problems in my constituency which I do not wish to see recur. I hope that my hon. Friend will
  1280
  be able to give some assurances to satisfy me that the Government are appreciative of the problems that can be created by a lack of understanding of land drainage.
  11.26 pm
  Mr. James Nicholson: It may seem incongruous that these instruments are not made by the Secretary of State for Northern Ireland also, but at the time of the parent Acts of 1967 and 1970, as I understand it, no such person existed. The Minister made orders for Northern Ireland also. It is, therefore, to him that I believe I am entitled to direct my remarks on the unhappy effects that the schemes will have on my constituency and on the Province.
  In Northern Ireland, good use has always been made of such schemes to improve and expand the agriculture industry. Agriculture there is now primarily a grass-based industry and the proposals could have damaging and long-term effects.
  I deplore the removal of grants for re-seeding in the lowland areas, and I ask the Minister, in the best interests of agriculture in Northern Ireland, to revise the decision. Coupled with the removal of the grant for land reclamation, this will hit the agriculture industry in Northern Ireland very hard. I cannot understand what possessed the Minister to allow such sweeping changes.
  The Minister must appreciate the different situation in Northern Ireland. It is all very well to talk about conservation, the importance of which both I and the farmers in Northern Ireland accept without reservation, but to talk about taking a hedge out of a 20-acre field to make it into a 40-acre field is wrong. To talk about taking four hedges out to make three 1½ acre fields into one 4 or 5-acre field is right and good for agriculture. That is the problem facing some farmers in Northern Ireland. Agriculture has been greatly improved in Northern Ireland by taking advantage of the schemes, but in many areas improvements are still needed. There should be scope for such improvements.
  If a young farmer starting out buys a rundown farm he will have difficulty in making the necessary improvements without the help of grant-aid. I should like to see aid and help given to such a young farmer.
  As I understand it, the re-seeding and reclamation items will continue in Northern Ireland until 31 March under the AHD scheme. I hope that this scheme will continue for another year.
  The reduction of grant-aid on permanent farm buildings will have severe effects, but the removal of aid for fixtures and fittings will mean that in some buildings the available grant aid can be reduced to almost 10 per cent. If grant-aid is given towards the building of, say, a cubicle house, why should it not be given towards the cubicles? This will hit farmers in Northern Ireland, especially small farmers, particularly hard.
  As for limiting the grant to 40 cows, will the Minister explain why, on a farm with, say, one and a half or two labour units—a father and son working together, or two brothers working in partnership—it should be restricted to 40 cows? It will be most unfair. Perhaps the Minister will also say how he proposes to bring the agriculture and horticulture development scheme into line with the AHG scheme.
  We have heard much about conservation and the environment. Throughout last summer in Northern Ireland we had a serious problem resulting from the leakage of

  1281
  silage effluent. This problem should receive special attention, and perhaps some incentive could be provided to improve catching facilities for the silage effluent of farms. I realise that the Minister may not be able to deal with that tonight. Perhaps he will bear it in mind.
  One welcomes the help to be given to the glasshouse sector, especially in respect of thermal insulation, in these days of high energy costs.
  The case for the extension of less favoured areas has long been exhausted, and I urge that an extension be brought into existence as soon as possible to alleviate, at least in some areas, the burden which the proposals will place on farmers. While one welcomes the extra help that is being provided for the less favoured areas in respect of the planting of shelter belts, the rebuilding of stone walls and the planting of hedges, the overall situation still gives cause for concern.
  In the present state of agricultural incomes, particularly bearing in mind the uncertainties over the future of the CAP support arrangements, farmers will be extremely cautious before making financial commitments to projects, many of which are vital for the continuation of the excellent record of improved productivity in the industry. The Government are deliberately taking money out of the industry at a time when agriculture, especially in Northern Ireland, is under great pressure. Those who will suffer most, certainly in Northern Ireland, will be the small farmers.
  We in Northern Ireland have mostly very small farms and many farmers rely on the conacre taking of land to exist. I hope that when the Minister discusses these matters with those responsible in Northern Ireland special consideration will be given to the points that I have raised. We are not asking for any handouts, but we have different problems and they require a different emphasis. I hope that the Minister will bear that in mind.
  11.34 pm
  Mr. John Corrie: I declare my interest as a marginal farmer and dairy farmer. Two things above all else improve land. One is drainage and other is liming. Sadly, we do not have the kind of grants for liming that will improve much of Britain's marginal hill land. I hope that my hon. Friend the Minister will keep pressing that point in Europe, although I assume that it will have to be a European decision before we got something along the lines that we need.
  I have just completed a large drainage scheme, and of course I got the higher rate of grant. Perhaps I can cheer my hon. Friend by telling him that even if I had not done so, I should nevertheless have been happy to do the work and take the grant that is now being offered, because it represents a reasonably good incentive.
  I am delighted with the extra grant for the improvement of drystone dykes and hedges on marginal land. Many youngsters in Scotland have been doing drystone dyking courses under the Agricultural Training Board scheme, more as a craft than anything else. This incentive to marginal farmers will mean that many broken-down dykes, which might not have been thought worth repairing, will now be repaired. If there is to be better management of that marginal land, it will be much easier if the land is properly fenced and dyked. I warmly welcome these provisions.
  11.35 pm
  Sir Paul Hawkins: I believe that my hon. Friend the Member for Cunninghame, North (Mr. Corrie) would have carried out his drainage scheme even if there had been no grant, because drainage schemes are essential.
  I must tell the hon. Member for Newry and Armagh (Mr. Nicholson) that I would have thought that, by now, most two, three or half acre fields would have been put together. The grant has been available for a long time——
  Mr. Roy Beggs: One point that is overlooked is that those best able to benefit from grants are those in a financial position to contribute in addition to the grants. Small farmers are not in that position. Older farmers do not have surplus cash to add to grants to make the improvements. The larger farmers with viable units have benefited most from past grant schemes.
  Sir Paul Hawkins: I understand the hon. Gentleman's point because I live in an area with many small farms. If the grants had been worth while in the past, they should, by now, have cured most of the troubles referred to by the hon. Member for Newry and Armagh.
  Mr. J. Enoch Powell: There appears to be some confusion in the hon. Gentleman's mind between small farms and small fields. In Northern Ireland, because of the history of land tenure and enclosure, there is a proliferation of extremely small fields—for which there is no parallel on this side of the Irish Sea.
  Sir Paul Hawkins: I am grateful to the right hon. Gentleman for explaining that point. I agree with him, although I did not previously know that that was the position in Northern Ireland.
  I agree wholeheartedly with the right hon. Member for Wakefield (Mr. Harrison) about the great difficulty in coordinating between the various authorities. I live within half a mile of the Fens, and within half a mile of Denver Sluice—the major drainage scheme undertaken by the great Dutch engineer Vermuyden during the time of King Charles. The flooding there every seven or eight years stemmed largely from the lack of co-ordination between the various drainage authorities. Some years ago. and at long last, a major scheme was carried out, and most of the dangers from flooding have now been removed. But it is the lack of co-ordination that causes so much trouble.
  I wholeheartedly agree with the vast majority of the alterations to the grant system. I wish that I did not have at the back of my mind the feeling that the alterations have been proposed mainly to save money rather than to try to change the way in which grants are given. I believe that they should be aimed at helping the small and medium-sized farmers, rather than the larger farmers. I know that this has been done in certain cases and that the emphasis is changing a little in terms of the size of cow and pig herds and so on, but we do not go nearly far enough. We need a far greater differential in pricing, grants and everything else to enable smaller and family farms which are part of the lifeblood of the country to continue to exist.
  On drainage grants, I agree with the comments of the hon. Member for City of Durham (Mr. Hughes) about making provision for certain types of area. My constituency contains a large area of black fen which has been sinking for a very long time so that the drains gradually become completely useless. In some areas the

  1283
  land has sunk between 20 ft and 30 ft in the past 50 years. Major drainage schemes have to be undertaken by the water authority every 10 to 15 years to keep the main drains going. Farmers then have to connect up with the new system. The average farmer should by now be able to bear the cost of ordinary drainage works himself, but I believe that linking up with a new system in the circumstances that I have described should continue to be grant aided. I hope that my hon. Friend the Minister of State will say something about that.
  In passing, I must say that I should be grateful if my hon. Friend the Minister would not use so many initials in his speeches. Everyone has got into this habit nowadays and I find it difficult to understand what anyone is talking about. Even on the wireless one hears about "INFT" and the like. It would greatly help old-fashioned, out-of-date Members such as myself if we could be given a little more information.
  I do not favour increased grants to co-operatives. I told my hon. Friend the Member for Torridge and Devon, West (Sir P. Mills) that I intended to mention this. One has only to think of what happened to Devon Meats not long ago. That co-operative made a hell of a mess and lost a great deal of money. The great National Farmers Union cooperative, the Fatstock Marketing Corporation, had to be sold after losing money for many years. I do not believe in these co-operatives at all. They are top heavy in administration, no one is really in charge with a duty to make the operation profitable and I am not happy about continuing to grant aid them.
  Finally, I greatly favour giving grant aid for windbreaks in the least favoured areas, to which my hon. Friend the Minister referred. The parts of East Anglia that really need windbreaks are the black blowing fens. The provision of windbreaks there should be grant aided, as it will prevent the clogging up of drains. Anyone who knows the black fen from Ely to Downham Market will know that every time there is a blow in March all the dykes get filled up and have to be dug out again. Any assistance for farmers in that respect is therefore a very good idea.
  Mr. Farr: My hon. Friend said that the land in Ely is sinking and that wind breaks are needed to protect the black soil from blowing into the dykes. Will he agree, on reflection, that the land is not sinking but that the level is falling by continual soil erosion? The land has been used generation after generation for crops and straw.
  Sir Paul Hawkins: The land is sinking. If one drives through the Fens, the rivers are perhaps 15ft. to 20 ft. higher than the land on either side. Initially, the water from the dykes was piped into the rivers. It must now be pumped and stronger pumps are needed.
  The soil is blowing into the dykes and must be returned to the land. The soil is also being eaten by microbes. I could talk about the black Fens for a long time. I shall not do so as the Minister, no doubt, wants to go home to bed.
  I congratulate my hon. Friend the Member for Norfolk, South (Mr. MacGregor), who is also the Minister, on the fact that the vast majority of the changes have been well-thought out. I hope that he will examine some of the issues raised in the debate, especially main drain junctions which have had to be altered and have caused farmers tremendous expenditure not of their own causing.
  11.46 pm
  Mr. Andy Stewart: Much of what I wanted to say has already been said by hon. Members.
  The agriculture industry recognises the fact that, for the country to get moving, it must play its part in reducing expenditure. While I have been associated with the industry, cuts and increases in grants have taken place. The industry has responded by increased production every other year without relevance to the grant.
  The environmental protection grants are important. Our industry has received considerable flak in that the general public considered, quite correctly, that the industry was destroying our heritage. Will the farmers who have entered into the agricultural and horticultural development scheme and been approved, continue to receive their grants?
  I agree with what my hon. Friend the Member for Norfolk, South-West (Sir P. Hawkins) said about the cooperative grants. They have not in the past been a model on which to plan the future. I hope that the Minister will not encourage that approach.
  The industry in the past two years has welcomed the marketing organisation. I support what my hon. Friend the Member for Norfolk, South-West said about the differential in the grants for large and small farmers. Young farmers must also be helped. They are at a disadvantage when compared with the large farmer. The agriculture industry will have some difficulty in accepting the drainage grant. Much has been said about the reduction in the grant.
  A phenomenon of the past 10 years, especially in my part of England, is that rainfall occurs more in the form of flash floods and heavy rainfall in shorter periods than in the past 40 years. That is a proven fact. That encourages greater flooding than we have experienced in the past.
  On the whole, the agriculture industry will respond, and will continue to increase production for the benefit of the community in which we live.
  11.49 pm
  Mr. MacGregor: With the leave of the House, Mr. Deputy Speaker, perhaps I might reply to the debate.
  I begin by apologising to my hon. Friend and neighbour, the Member for Norfolk, South-West (Sir P. Hawkins) for using initials. It is rather late at night, and had I tried to spell out the full name of some of these schemes I should have got into considerable difficulty.
  I am grateful for the broad, although not universal, welcome to the changes and general philosophy behind the schemes. I thank in particular the hon. Member for City of Durham (Mr. Hughes) for his comments on the broad mix of the changes. He said — I think I quote him correctly—that this was all about cutback. As I said in my opening remarks, given current economic conditions, it is necessary for agriculture to play its part in public expenditure savings, but I repeat that next year we shall spend in capital grants the same amount in money costs as we are spending this year—£205 million. That is partly the answer to the hon. Member for Ceredigion and Pembroke, North (Mr. Howells).
  Although we have made certain compensating savings, the fact that we are spending the same amount is a sign of the increased investment in the agriculture sector. That money will come from Government sources, and £205 million in capital grants is by no means a small sum.
  The hon. Member for City of Durham and my hon. Friend the Member for Norfolk, South-West will be

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  interested to learn that we have reviewed the schemes or levels of grant to deal with those that may no longer be as appropriate or cost-effective. Although I do not pretend that this has been a major review of the capital grant schemes, we have tried to reflect changing priorities. There is, I believe, consistency in the way in which the changes have been made.
  We thought long and hard about drainage, the only area about which the hon. Member for City of Durham was critical. The cut involved in the lowland rate for drainage under the agriculture and horticulture general scheme is from 37·5 to 30 per cent. The reduction in the less-favoured areas is from 70 to 60 per cent.
  That still leaves a significant level of grant. Therefore, within the grant schemes, there is still a big incentive and aid for drainage. Although I have been unable to check this tonight, I suspect that I am right in saying that the net cost of drainage schemes could also be charged against tax for tax allowances. That is another incentive, and I repeat that considerable incentives are still available for drainage within the capital grant schemes.
  My hon. Friend the Member for Harborough (Mr. Farr) asked about the dates from which the grant rate changes will apply. He was referring to the AHGS, but I shall also refer to one of the other schemes, as it is important that farmers should know where they stand. I fully appreciate my hon. Friend's concern.
  Under the AHGS—the general scheme—the changes will apply to expenditure incurred on or after 1 December 1983. If a claimant can demonstrate that he incurred expenditure before that date, he may be eligible for the old and, usually, higher rates of grant.
  Under the AHDS — the development scheme — the changes will apply to new applications or to variations to approved plans received on or after 1 December 1983. Therefore, where an applicant can show that he had incurred expenditure before 1 December 1983 in connection with a subsequently approved plan he, too, may be eligible for the old rate of grant.
  My hon. Friend also referred to the Weed Research Institute. This is an independent institute and not part of the Department. Therefore, whatever is done in relation to it must be a matter to be decided by the Agriculture and Food Research Council.
  The hon. Member for Ceredigion and Pembroke, North referred to marginal land areas. Perhaps I may say a little more about the position in relation to the EC. My right hon. Friend the Minister of Agriculture and I have spent a great deal of time in recent Agriculture Councils pressing the case for an extension of the less favoured areas. We think that there is a watertight case, because we are not asking for any change in the Community scheme, but simply saying that after further work has been done in this country we believe that these additional areas, for which we are pressing, are eligible for the LFA assistance that is available under the Community scheme.
  The case is accepted by the Commission, which agrees also that we are not asking for any change in the rules. It is also accepted by the majority of member states, but three member states are still resisting that extension, for reasons of their own. Because of that, it is not yet possible to get the changes through. One of the reasons given is that the Commission is proposing changes for the structures. It is already clear to us that those changes will not come in quickly. Therefore, we believe that there remains a strong case for the extension for which we have been pressing.
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  I assure the hon. Member that we will go on pressing the case. My right hon. Friend has made it clear that additional resources will be available as soon as the changes are made but obviously he must await the details.
  The hon. Gentleman also referred to stone walling on marginal land. Once the Community has agreed to the extension of the less favoured areas, these grants will be payable on marginal land areas. My right hon. Friend and I are giving this top priority and putting heavy efforts into achieving the acceptance of this by the other member states.
  I am grateful to my hon. Friend the Member for Macclesfield (Mr. Winterton) for his support for the changes on conservation. I accept that they are limited, and I said so in my opening remarks. Nevertheless, I think that this is the right step to take.
  My hon. Friends the Members for Macclesfield, for Norfolk, South-West, for Sherwood (Mr. Stewart) and one or two others spent some time, following the lead given by the right hon. Member for Wakefield (Mr. Harrison), talking about the relationship between the agricultural land drainage scheme and arterial drainage on the one hand and planning and flooding problems on the other. I shall ponder what has been said. Hon. Members will recognise that other Departments are involved. I had perhaps better say to my hon. Friend the Member for Macclesfield that that is not an assurance of change, but I hope he will agree that it is a thoughtful response. I shall think further about it.
  I should like to respond to the invitation of the hon. Member for Newry and Armagh (Mr. Nicholson). I shall discuss his comments with my noble Friend the Minister of State, Northern Ireland Office. I have two comments on other points that he raised of more general impact. He asked when we would be bringing together the AHGS and the AHDS. These are separate schemes. As he knows, one of them is a Community scheme. Therefore, it is not possible to bring them together entirely, but there is a great deal of correlation between them.
  The hon. Gentleman also referred, as did my hon. Friend the Member for Norfolk, South-West, to the importance for small farmers of capital grant schemes. This is recognised. A number of the changes that we have made will have more impact in terms of less grant for large farmers. Also, as my hon. Friend and the hon. Gentleman may well know, there are financial limitations, often over a six-year period, on the total amount of grant that can be given to any one business or farmer. That, too, therefore, is a limitation on the larger farmers.
  Finally, I should like to comment on the point made by my hon. Friend the Member for Norfolk, South-West about fen land, and on the importance of windbreaks and the need for hedges. I am sure that my hon. Friend knows well, but it is always worth stating so that his farmers recognise it, that the planting of hedges remains eligible for grants at 20 per cent. We appreciate the importance of windbreaks. The Agricultural Development and Advisory Service does a good deal of development work, evaluating different types of windbreaks. My hon. Friend's point is well taken.
  Sir Paul Hawkins: I understood my hon. Friend to say that certain areas would get grants for windbreaks. He spoke about grants for hedges in fen lands, but I am talking about grants for belts of trees, which must be wide to be of any use.
  Mr. MacGregor: I said that ADAS does a good deal of development work on windbreaks, which I hope will be helpful to farmers everywhere, but the specific grant to which I referred at 20 per cent. is for hedges. My hon. Friend is referring to increased grants for this general area. I do not know whether he has in mind the change that we have made to increase the grant from 50 to 60 per cent. for walls and hedges, but that is in the upland areas.
  We have had an extremely useful and constructive debate, and many helpful points have been made, but what to me comes out of it is that, overall, apart from the point made by the right hon. Member for Wakefield about drainage, there is a general welcome for the changes that have been made under the instruments. There is a recognition that agriculture must play its part and that it makes sense to examine all the grant schemes to ensure that they still remain cost effective because, after all, taxpayers' money is involved.
  It is in that sense, and in the belief that we have put together a package that is acceptable, that I commend the scheme to the House.
  Question put and agreed to.
  Resolved,
  That the Agriculture and Horticulture Grant (Variation) (No. 3) Scheme 1983 (S.I., 1983, No. 1764), dated 29th November 1983, a copy of which was laid before this House on 30th November, be approved.

  Post Office (Barnsley)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Archie Hamilton.]
  12.2 am
  Mr. Roy Mason: I was disturbed and sorry to note in the press a few days ago a report about the future of town sub-post offices such as the Union Court sub-post office in Barnsley, which we are debating tonight.
  The report said that more than 1,600 post offices may face closure as a result of an internal review undertaken by the Post Office. The review was to examine the profitability of town sub-post offices and main post offices. Internal minutes of the September meeting of the Postal Business Joint Council reveal that the study concluded that 1,609 of the 9,533 town sub-post offices should be closed if the Post Office insisted that they made a profit. Of course we all know that the review was forced on the Post Office as a result of the tough financial targets set for the service. It is now specially looking for loss makers. It is the profit test. Profit, not need, is the theme.
  I never thought, as a former Postmaster General, that I would see the day when the profit motive would be determining the existence and future of our sub-post offices. However, it can never be the test of country or rural sub-post offices, nor should it be the test where a case of need exists and is seen to exist in a town sub-post office. This is a cruel streak, emanating from the Government's monetarist policy, which is already causing distress to many thousands of people who are sorely in need of help, yet by the post office closure decisions are being denied it.
  I wish to present the case for the survival of the Union Court sub-post office in Barnsley. Mrs. Joyce Brookes, the postmistress, who is now 62 years old, is about to retire. The postmaster and the chairman of the Post Office are —to use their words—"seizing this chance" to close it. That is almost the language of the profiteer; it is not the caring Post Office that I knew.
  On 7 September, Mr. Wilcock, the head postmaster in Barnsley, informed interested parties that, because Mrs. Brookes had tendered her resignation, he had formed the view that Union Court could close, and that the needs of its customers could adequately be met elsewhere —naming Agnes road sub-post office, the head post office in the town, and Doncaster road sub-post office. On 18 October the mayor and councillors met the head postmaster. They pointed out to him the harshness of the decision, and said that the alternatives of Agnes road, the head post office and Doncaster road were inadequate. To go to Agnes road would mean a walk along hilly terrain for about 1,000 yards, with no bus service in the region. To go to the head post office would mean a long walk and the negotiation of traffic, or catching a bus and then walking. To go to Doncaster road would require the negotiation of traffic on a busy road, with no buses available.
  The councillors explained the difficulties in winter months of the walk to the general post office—of the persistent queues in that post office, and a counter service that leaves much to be desired now, let alone if Union Court closes. Councillor Fred Lunn, leader of the council, explained that there is apparent chaos on his every visit to the general post office. Councillor Jack Hood explained

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  that the elderly and infirm must stand for 20 minutes or more. The head postmaster apparently accepts that, because he said that staffing changes were proposed to counteract those problems. Even before the Union Court closure, he cannot provide a good service. Councillor Roy Fisher informed the head postmaster that the social circumstances would be disastrous for the aged people if the Union Court facilities were taken away, especially with a further influx of elderly people into the area. The mayor, Councillor Keith Borrett, on behalf of the entire council, expressed his deep and sincere concern about the head postmaster's proposal.
  Why all this fuss? Why did the whole town council express opposition to this closure? There was a petition with 1,800 signatures in opposition, a demonstration of opposition by old-age pensioners outside the general post office, and a major intervention by Age Concern in Barnsley and district. Union Court sub-post office is right in the centre of a housing development incorporating high-rise flats—Britannia, Albion and Buckley houses—that were built mainly for pensioners and that are all within 100 yards of the post office. Around the post office are maisonettes and flats for the elderly and disabled; 138 pensioners from the tower blocks use the post office, and eight out of 10 of the disabled and elderly people who live there depend on it.
  I visited Union Court last weekend and met the postmistress. Naturally, she is pleased that her customers will be served over Christmas and the New Year—the few weeks' reprieve that we have managed to get from the chairman of the Post Office. This post office was built with local authority assistance. It made an appraisal, the post office was custom-built because of the circumstances, and it was opened in 1969. There was a special need then, and the need is greater today. There has been more building in the area, and the local authority plans to build another 28 dwellings to house 58 aged and handicapped people in the immediate vicinity. The local authority believed 14 years ago that the post office would be an absolute necessity—it would be handy and convenient—because of the preponderance of old people in the area. It was a sensible, caring decision — caring based on needs —which is why we have had 50 years of unbroken Labour local authority rule in Barnsley. Our local authority cares.
  If this post office closes, hundreds will be adversely affected. Even the textile factory of S. R. Gent nearby will miss it because of the lunchtime traffic that it provides. It will be a terrible upheaval for lonely old folk. They can safely leave this sub-post office, as it is within the area of their people. There is no trouble, and there are no muggings, and Mrs. Brookes tells me that since the post office opened in 1969, the area has been trouble-free, and there has been not one irate customer. Imagine all these old people having to go to the town centre post office—many would be afraid to do so. Not enough thought has been given to the problems of this closure and the needs of the elderly and infirm.
  Postmaster Mr. Wilcock concedes:
  "I would readily accept that closure would result in some residents being inconvenienced. This must inevitably occur when a long established facility is withdrawn."
  Mrs. Tricia Hicks, the care co-ordinator for Age Concern in the area spelt it out when she said:
  "Obviously, checks have been made into the distance between Union Court and the alternative office, but, geography has not been taken into account. Yes, Agnes Road sub office is about half a mile distance as the crow flies, but, after an initial climb
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  uphill there is a very steep drop down to Agnes Road. On the way back from this office it would be impossible for the elderly to climb this hill. Barnsley Head Office in Pitt Street is also impossible to reach by public transport and if the elerly are able to reach it there is then a queue of anything from 63 (I have checked this) to 100 people waiting on two counter clerks. Elderly and handicapped people cannot possibly wait (standing) in this queue. Doncaster Sub Office and Worsbrough Common Sub Office both entail hills in either direction and extremely busy roads to cross and no public transport on that route to use."
  The Mayor, Councillor Keith Borrett, made a public statement, in which he said:
  "It is an inhuman decision taken with callous disregard for the needs of the elderly and disabled pople living in the area.
  "It will sentence pensioners and disabled people to either queuing in pig pens in Pitt Street Post Office"
  that is the head post office—
  "or cross country climbs to other post offices."
  The housing director intervened, and let the Post Office know what he thought about the matter. He said:
  "I cannot agree with the comment that the Head Post Master makes that the viability of 4 alternative offices will adequately meet the community needs. The location of the other 4 Sub Post Offices are inconvenient and difficult to reach by elderly persons and I would think that very few are in a position to appoint a friend or relative to collect pensions on their behalf. I think it is a matter of some importance that when the previous privately owned Post Office in Sheffield Road was demolished, as a result of slum clearance, the present building was specifically provided, in conjunction with the Post Office, for this purpose and indeed special structural design features were incorporated to meet the post office needs. Because of its location, so near to main shops in the town centre, it is considered that the post office shop would be unviable for business purposes without the sub post office facility. It seems very unreasonable to me, the Council having gone to such considerable capital expense. that the Post Office should unilaterally withddraw this facility. I would point out similarly that the Council have again spent additional substantial monies in providing post office facilities in a very much smaller area at High Hoyland and I would not like to think that this could be closed at a mere whim of the Post Office leaving the Council with another white elephant on its hands."
  These are all storms of genuine protest, from all sections of the community. Everybody except the head postmaster believes this proposed closure of the Union Court post office to be an outrage. The image of the caring, compassionate post office service has been blighted and Mr. Wilcock has made a mistake. However, there is still time to rectify the closure decision. There are three weeks to go. I ask the Minister to recognise the needs of so many who need Union Court. The postmaster could advertise for a replacement for Mrs. Brookes, which would relieve the anxieties and worries of all these old and disabled people. He should recognise the increasing need because of the planned influx of more pensioners in that area, and in the changed circumstances since his letter of 7 September, announce that the Union Court sub-post office will remain open.
  Mr. Allen McKay rose——
  Mr. Deputy Speaker (Mr. Harold Walker): Does the hon. Gentleman have the permission of the right hon. Member for Barnsley, Central (Mr. Mason) and the Minister to intervene in the debate?
  Mr. Mason: I should be delighted, Mr. Deputy Speaker, if my hon. Friend managed to catch your eye.
  Mr. McKay: I thank my right hon. Friend the Member for Barnsley, Central (Mr. Mason) for allowing me a few

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  minutes of his Adjournment debate to take up the case of my constituents in the area. I also congratulate him on having obtained this debate.
  The Union Court post office is in my right hon. Friend's constituency, but it borders my constituency. As a result, many of my constituents use the post office, and many of them will be affected by the proposed closure. The effect on them will be severe, as a majority of the people concerned are elderly and have various degrees of infirmity.
  The problem was recognised by the local authority when it was asked by the postal authorities to provide a post office in the area. The council spent money in making that provision, and that is why the council is so much concerned. The mayor and the leader of the council have taken an active part in protesting against the closure of the post office, as have the senior councillors, who know the details of the case and the problems that it causes for many of my constituents.
  Why, after all this time, and when the post office was provided in the area for a specific purpose, is the post office to close? As my right hon. Friend said, the easy option has been taken, purely and simply because the postmistress is to retire. I might ask, "Would the post office have closed had not the postmistress been retiring?" I think that the answer to that would be no, because there was no prior indication of the post office closing. One can reasonably say that the proposed closure is purely and simply because of the lady's retirement. So the decision was taken as the easy option and for the convenience of the postal authorities, but it means inconvenience and the bad option for my constituents.
  The number of people living in the area around the post office has increased. Moreover, it is an area of high demand, I was vice-chairman of the council for a considerable time, as well as chairman of the building development committee, and even at that time the area was being considered for further development.
  As my hon. Friend said, there are long queues at the central post office. People who work at a nearby factory, S. R. Gent, use the Union Court post office more and more, simply because the time that they waste queueing at the central post office is more than offset by the extra distance that they have to go to the Union Court post office. The alternatives that are suggested are inconvenient for the elderly and infirm, as the report from the housing director said. In fact, the housing committee works in close liaison with the social services committee and is in a better position than anyone else to know about the problems of the old and infirm in the area.
  I therefore support my right hon. Friend and ask the Minister, even at this late stage—it is not too late—to take into account the hardship that will be caused to many people in the area. If he bears in mind the furore that has been caused by the proposed closure, he will realise the depth of feeling that exists among the people who will be affected.
  12.20 am
  The Under-Secretary of State for Trade and Industry (Mr. David Trippier): I am pleased to be able to reply to the debate. As the Minister with special
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  responsibility for small firms, I welcome especially the opportunity to acknowledge that the Government are conscious of the importance of small businesses.
  I fully understand the concern of the right hon. Member for Barnsley, Central (Mr. Mason) and the hon. Member for Barnsley, West and Penistone (Mr. McKay). The future of sub-post offices is of concern to the Government. Ministers have frequently referred to the important role which sub-post offices play as providers of important services and often as community meeting places that fulfil a social need. That is why the Government have consistently pledged to ensure the maintenance of an adequate sub-post office network. I welcome the opportunity to repeat that commitment.
  I think that it would be helpful if I were to set out the statutory position, which has changed substantially since the right hon. Member for Barnsley, Central was so personally involved. The Post Office was a Government department until 1969, when the Post Office Act established it as a public corporation. In common with other nationalised industries, the Post Office was given considerable autonomy in that Act for the management of its day-to-day business. It has been accepted by successive Governments that it is for the Post Office board to run the business with Government involvement limited to discussion of broad policy matters and, of course, the setting of financial and performance targets.
  I stress that this is not a party political point. This has been the policy of successive Labour and Conservative Governments since 1969. Thus, the Government have said that they are committed to the maintenance of an adequate sub-post office network. It is for for the Post Office to say whether the provision is adequate in a particular location.
  The right hon. Member for Barnsley, Central has sought to portray the closure of Union Court sub-post office as being somehow symptomatic of what he describes as the cruel streak in the Government's monetarist policy. I had hoped to avoid political points because I recognise that this is a matter of genuine concern to local residents and worthy of more serious debate but, as the right hon. Gentleman has raised the issue, I shall mention in passing that during the lifetime of the previous Labour Government net closures of sub-post offices averaged more than 200 per annum. This compares with 157 net closures in the year ending March 1980, 162 in 1981, dropping to only 62 up to March 1982 and 98 in 1983.
  The Post Office accepts that it has a duty to provide counter services through its network of main and sub-post offices as efficiently as possible and in a manner consistent with meeting the efficiency targets which have been set both by this Government and by the previous Labour Administration. But the Post Office also accepts that in providing these services it must have regard to the commercial and social needs of the community. It is this balance between sensible and desirable cost benefits and social needs in particular which leads to difficult choices. It would be wholly exceptional if any sub-post office closure were to be achieved with no one even slightly inconvenienced. But the balance has to be struck.
  When a sub-postmaster resigns or retires, the Post Office always carry out a full survey of the area to determine whether it is still appropriate to have an office at that location. As the sub-postmaster may have held that position for a long time, during which population movements could have taken place, the circumstances in

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  which the original sub-post office was justified may have changed significantly. The Post Office will be guided by its experience that has led to the broad criterion that the right balance can normally be maintained by siting Post Offices at not less than one mile apart in town areas. But experience has shown also that this is not the sole criterion. It takes into account also the ability of nearby offices to absorb the business and the ease with which people can reach them. This will involve consideration of the age profile of those using the sub-office—and any physical disabilities--the terrain of the area and the availability of public transport.
  The Post Office is also guided by a procedural arrangement agreed with the Post Office Users National Council, which involves consultation with the local authority, with local Members, with representatives of local residents and other interested parties.
  I accept that in some cases, the eventual decision to close a particular office may seem harsh. Indeed, as I have said, some protest is inevitable in every case. But I do know that the Post Office takes a great deal of care when making decisions about closing sub-post offices. The examinations are carried out most thoroughly and conscientiously. Indeed it would be foolish of the Post Office to act in any other way and to risk unreasonably alienating the very people whom it is in business to serve.
  It should not be forgotten that in a number of cases an office has to be closed because no suitable applicant for the sub-postmastership can be found. I have said that the Government do not have the power to intervene in individual sub-post office closures. Nevertheless, the right hon. Member for Barnsley, Central and the hon. Member for Barnsley, West and Penistone raised this question with my hon. Friend the Minister of State. He passed the papers to the chairman of the Post Office, who has now replied to the right hon. Gentleman.
  Against the criterion that town offices should generally be sited about a mile apart, central Barnsley does very well indeed. The Union Court office is within half a mile of four other post offices—Barnsley Road head post office, Agnes Road, Doncaster road and Oakwell sub-offices. Worsbrough common sub-post office is only about 1,000 yards away. In considering these alternatives, the Post Office ruled out Oakwell and Worsbrough common sub-post offices on the grounds that the journey would be too arduous. That still left three alternatives which the Post Office felt could cope with the extra customers and which could be used conveniently by those who currently use Union Court.
  I am told that Agnes road provides a number of other retail outlets besides a post office, and at about 700 yards
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  is a reasonably covenient alternative. Although the terrain is rather hilly, I understand that Agnes road is accessible to the majority of Union Court residents. Doncaster road sub-post office could attract residents of the eastern side of Sheffield road, and bus services are available to assist the journey.
  I believe that shopping facilities around Union Court are limited and that the very close proximity of the town centre, with its extensive market and regular bus services, provides reason for regular visits by most residents. Access to the head post office from the town centre is not difficult and, indeed, a number of the residents of the Union Court area already use it.
  I know that the right hon. Gentleman is aware of the report from the Post Office on the considerations which led to the conclusion that the Union Court sub-post office should not be re-opened. It is clear to me that the Post Office has considered this case most thoroughly and at the highest level. I am satisfied that procedures have been followed and that local views have been sought and taken into account. The decision to keep the office open over the Christmas and New Year period is witness to the Post Office's responsiveness to local views.
  I am naturally sorry that a decision to close Union Court sub-post office will cause disappointment and some inconvenience to some of the constituents of the right hon. Gentleman and the hon. Member for Barnsley, West and Penistone. I do not have the powers to intervene in this case. I believe, in common with all Ministers of both major parties who have beer responsible for these matters in the past, that it is right to leave detailed decisions such as this to members of the Post Office management. That is what they are paid to do and I believe that they do it in a way which is responsible and which reflects their tradition of an awareness of their social responsibilities.
  Nevertheless, I acknowledge that the right hon. Gentleman and the hon. Gentleman have brought forward information this evening about the possible building of accommodation for up to 56 elderly people in the Union Court area. I appreciate that this information has not yet been made available to the chairman of the Post Office. I suggest that the right hon. Gentleman could usefully draw it to the chairman's attention—and, of course, the chairman will read this debate. I must, however, make it clear that this is not a matter on which I can seek to influence his decision.
  Question put and agreed to.
  Adjourned accordingly at twenty-eight minutes past Twelve o'clock.