Commons Sitting of 14 July 1983

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

PRIVATE BUSINESS
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 21 July.

Oral Answers to Questions
  HOME DEPARTMENT

    Capital Punishment
    Mr. Ioan Evansasked the Secretary of State for the Home Department what representations he has received regarding the proposal to reintroduce capital punishment by hanging.
    The Secretary of State for the Home Department (Mr. Leon Brittan): Since 10 June my Department has received about 1,100 letters about capital punishment from organisations and members of the public, either direct or forwarded by hon. Members.
    Mr. Evans: In view of the decisive votes yesterday, will the Home Secretary assure us that the restoration of capital punishment is finished as a topic for discussion for a very long time to come? Will he reject any moves for a referendum on the issue? Does he realise that to deal with the problems of crime and violence we must tackle the problem of carrying arms and will he introduce measures to deal with that? Does he realise that if we are to deal with crime and violence the Government must re-examine their economic and social policies, which have led to the increase in crime in recent years?
    Mr. Brittan: It is not for me to stop or to promote debate, but I should have thought that last night's votes were sufficiently decisive for it to be unlikely that the matter would come before the House again for quite a while. I do not believe that matters that are not of a constitutional type are suitable for a referendum. Yesterday's debate on capital punishment showed clearly that not just one but many questions must be asked, even by those who favour its restoration—for whom, in what circumstances, and so on. Therefore, the idea that there is a single question that can be answered in a simple way is not one that I find attractive.
    996
    The social causes of crime are many and various. I do not think that they can be easily identified in a supplementary answer any more than in a supplementary question.
    Mr. Michael McNair-Wilson: In view of last night's votes, if the subject of capital punishment arose again in this country would it not he vital to hold a referendum? Should not Parliament know beyond peradventure the nation's view on this subject so that Parliament and the people are closer together in their general view?
    Mr. Brittan: If there was one common thread in yesterday's debate it was the recognition by most people of the probable state of public opinion in so far as it could be ascertained. Therefore, if the object of a referendum is an inquiry I do not think that is necessary. If the object is a decision, for the reasons that I gave earlier, I do not think that it is appropriate.

    European Parliament (Postal Votes)
    Mr. Lathamasked the Secretary of State for the Home Department whether he will present early legislation to the House, in advance of the election to the European assembly, to allow postal votes in that election for persons intending to be on holiday on polling day.
    The Under-Secretary of State for the Home Department (Mr. David Mellor): My right hon. and learned Friend is actively considering the question of legislation on this matter, but it is doubtful whether such legislation could be introduced in time for the European Parliament elections next year.
    Mr. Latham: As there is a clear date for the election, is my hon. Friend aware that some of us would regard the Government's decision on this as showing whether they seriously intend to respond to the wishes of the House or to kick the matter into touch for another five years?
    Mr. Mellor: My right hon. and learned Friend made the Government's position clear in the debate on the Queen's Speech when he said that it was wrong in principle that people on holiday should be unable to vote. As he will make clear in answering subsequent questions about the report of the Select Committee on Home Affairs, we believe that this cannot be dealt with piecemeal but must be taken together with the other reforms suggested The Government's response will be published in due course.
    Mr. Beith: Do the Government intend that the European election should be fought not just on an inadequate system but on boundaries made out of date by the recent Westminster boundary changes?
    Mr. Mellor: The Boundary Commission can only work at a certain pace and those who object to what it recommends must enjoy their right to have those objections heard. The hon. Gentleman can do the arithmetic as well as I can and must know how short tame is. He will arrive at the same conclusion as I did—that it will be extremely difficult for any change to be effected before the date fixed for those elections.
    Sir Michael Shaw: Will my hon. Friend assure us that, in carrying out the review, he will not overlook the right of British citizens who live in Europe to vote at the European elections?
    Mr. Mellor: I am happy to give my hon. Friend that assurance.

    Community Leaders
    Mr. Blackburnasked the Secretary of State for the Home Department what guidance he gives chief constables for advising community volunteer leaders about law and order problems within the civil defence context.
    The Minister of State, Home Office (Mr. Douglas Hurd): Guidance on the role of volunteers and community organisation in war is in Home Office circular No. ES 2/1981. It does not cover law and order, which are the responsibility of the Government and the police. It is for chief constables to decide on any advice they might give to community volunteer leaders.
    Mr. Blackburn: Is my right hon. Friend aware that law and order are matters of concern to community civil defence workers and that the advice they receive from chief constables varies? Will he consider issuing guidance to chief constables on this matter?
    Mr. Hurd: We must stick to the principle that problems of law and order are, in any circumstances, the responsibility of the Government and the police. It is natural that chief constables should want to give what information they have to community volunteers. I should like to think about my hon. Friend's suggestion.
    Mr. Neil Thorne: Will my right hon. Friend be kind enough to consider the cost of the operation, in that when local authorities carry out duties on behalf on civil defence they often generate a substantial penalty against the rate support grant? Is he aware that they sometimes incur a penalty of £3 for every £1 that they spend? Is he further aware that that will remove the 75 per cent. funding from central sources?
    Mr. Hurd: I am not sure how often my hon. Friend's theory is likely to occur in practice. The House will have an opportunity to discuss that when we debate the new regulations.

    Representation of the People Acts
    Mr. Neil Hamiltonasked the Secretary of State for the Home Department when he expects to complete his consideration of the report of the Home Affairs Committee on the Representation of the People Acts.
    Mr. Beithasked the Secretary of State for the Home Department when he expects to complete his consideration of the report of the Home Affairs Committee on the Representation of the People Acts.
    Mr. Kirkwoodasked the Secretary of State for the Home Department when Her Majesty's Government expect to have concluded their consideration of the recommendations of the Home Affairs Committee report on the Representation of the People Acts.
    Mr. John Huntasked the Secretary of State for the Home Department when he expects to complete his consideration of the report of the Home Affairs Committee on the Representation of the People Acts.
    Mr. Brittan: Shortly, Sir.
    Mr. Hamilton: Is my right hon. and learned Friend aware of the sense of injustice felt by many people who were deprived of the right to vote at the general election
    998
    campaign because they were on holiday? Is he further aware that there is a difference between elections for local government or the European assembly, the dates of which are known in advance, and general elections, the dates of which are not known in advance? Is he aware also that for the latter people are not able to make appropriate arrangements? Will he introduce legislation as soon as possible to implement the change recommended in the report?
    Mr. Brittan: I am not simply aware of the concern, I share it to the full. It is helpful of my hon. Friend to point out the practical implications of doing something about different types of elections. Changing the timetable for a general election would raise wide issues. The problems of change are not insuperable, but they are considerable, for fixed elections. Nevertheless, I share my hon. Friend's anxiety.
    Several Hon. Members rose—
    Mr. Speaker: Order. I propose to call first those hon. Members whose questions are linked.
    Mr. Beith: When considering the Committee's proposals on deposits, will the Minister bear in mind that parties that are less comfortably financed than the Conservatives would have a major problem in laying out more than £500,000 to fight an election if that proposal were implemented? Will he stand by the previous Government's assurance that such legislation being passed will depend on all-party agreement?
    Mr. Brittan: I am sure that the House will want to know that the hon. Gentleman speaks with a spirit of altruism, because the Liberal-SDP alliance lost 19 deposits whereas the Labour party lost 119. The objective of any change would be to reflect changed circumstances since 1918, when the deposit was fixed at £150. It would not be intended to jeopardise the legitimate operations of democracy.
    Mr. Kirkwood: Is the Home Secretary aware that the report shows that inaccuracy in the register from 1951 to 1961 increased by 9 per cent.? Is he worried about that? If so, what does he propose to do about it? Does he agree that it is interesting that we should be considering the detailed mechanics of electoral law which disfranchises about 9 per cent. of the population, when the first-past-the-post system disfranchises far more?
    Mr. Brittan: When the electorate had the opportunity to vote for parties that advocate proportional representation, 70 per cent. chose not to. We can do something about the accuracy of the register in advance of legislation, because much can be done by administrative means. We held a seminar with some registration officers to discuss some aspects of this issue. We shall hold more meetings with other registration officers and review the design of some of the electoral forms. Those are the practical steps that can be taken in any event.
    Mr. Hunt: My right hon. and learned Friend has told us when he will reply to the Select Committee's report. Will he be a little more specific about when he will act on its recommendations, especially in respect of votes for holidaymakers? Does he appreciate that that matter is urgent and that there is strong feeling in the country about it? Does he further agree that we cannot let the matter drift for much longer?
    Mr. Brittan: I assure my hon. Friend that it will not drift. Equally, he will understand that it is not for me to announce the legislative intentions of the Government, still less their timing. I hope that by what I said during the debate on the Queen's Speech and by what I have said today I have communicated my anxiety about the matter and my belief that action is necessary.
    Mr. J. Enoch Powell: Are these not matters which, not being wholly neutral politically, ought to be considered by a conference under your chairmanship, Mr. Speaker, before there is any consideration of a change in the law?
    Mr. Brittan: Experience of these matters shows that the best advice was given by Mr. Speaker Selwyn Lloyd, who did not commend such a practice to the House. The new Select Committees and their reports are a new development. I do not believe that the course that the right hon. Gentleman commends is necessarily the most appropriate.
    Mr. McCrindle: While we await legislative proposals on votes for holidaymakers, would it not be useful for the Home Secretary to explain now what has been considered the essential difference between being on business in Birmingham, which has entitled me to a vote, and being on vacation in Ventnor, which has not?
    Mr. Brittan: I have been unable to find a rational distinction between the two. The only basis is that it is thought possible to prove the one and not the other. The law is founded on that. That is not a satisfactory distinction or a satisfactory basis for such discrimination.
    Mr. Dubs: Is the Home Secretary aware that what he said about examining inaccuracies in electoral registers at the recent general election is most welcome? Is he further aware that many hon. Members, on both sides of the House, have complained about what they learnt of the electoral registers in their constituencies? Will he keep the House informed of any progress that he makes in improving the quality of the registers?
    Mr. Brittan: I am grateful to the hon. Gentleman. I shall do what I can to keep the House informed. Many of the issues are technical and involve minor administrative matters, but collectively and cumulatively they will, I hope, lead to welcome improvements in the registers.
    Mr. Lennox-Boyd: Does my right hon. and learned Friend agree that any changes in our electoral system that led to the permanent domination of the: Government by a minority party would be undemocratic?
    Mr. Brittan: Yes.
    Mr. Adley: Will my right hon. and learned Friend fly in the face of the precedents set by all Home Secretaries and actually do something? Will he say now that he accepts that the pressure for postal votes is so strong, and the justification for them so clear, that he will do everything he can to persuade those who are responsible for Government business to act, and that he will not wait for the entire report to be accepted because he accepts the urgency and the wholly exceptional nature of the problem and will do something about it?
    Mr. Brittan: I have made my views on those matters clear. I do not necessarily accept that this aspect of the matter should be dealt with on its own. The Select
    1000
    Committee report made three principal recommendations, and I should not wish it to be thought that I regard the other two as less important.

    Police Officers (Memoirs)
    Mr. Aitkenasked the Secretary of State for the Home Department if he will make a statement on his recent meeting with chief constables concerning the publication of memoirs by senior police officers.
    Mr. Brittan: The Association of Chief Police Officers shares my concern about the publication of Mr. Gregory's memoirs. It told me that it was already considering the complex issues which it raised. This study, which I welcome, will continue, and the association will keep in touch with my officials.
    Mr. Aitken: Is my right hon. and learned Friend aware of the general feeling of distaste at this regrettable display of what might be called cheque book chief constablism by Mr. Ronald Gregory? Does he recognise that it is difficult to deal with such a matter by introducing new legislation? Might not the remedy lie in encouraging police authorities to have much stricter contractual terms of appointment for senior police officers?
    Mr. Brittan: I agree that what happened was deplorable and I took the earliest opportunity to make my views clear. My hon. Friend is right to mention the difficulty of proceeding by means of legislation. There is some information that an ex-chief constable can usefully give, but it becomes objectionable when he discloses information that is prejudicial to police operations or, as in this case, is damaging or distressing to individuals. We must find a way to deal with that.
    Mr. Flannery: I was interested in this matter because the Yorkshire Ripper was brought to a police station in my constituency. I was alarmed when Mr. Gregory prejudged the man, although his judgment proved to be correct. May we have an inquiry into the entire affair so that nothing like it can occur again, and so that someone cannot make a great deal of money out of the terrible misery of those poor people who suffered because of the inadequacy of the search for the Ripper, under Mr. Gregory's poor leadership?
    Mr. Brittan: I do not know what sort of inquiry the hon. Gentleman has in mind, but the Association of Chief Police Officers is considering the matter and consulting my Department, which I hope will lead to a practical solution to the problem.
    Mr. Fairbairn: Is my right hon. and learned Friend aware that as long ago as 1979, when Mr. Gregory was chief constable of West Yorkshire, he was preparing the series of articles with the help of officers employed by the police authority, and that in January 1980 he forbade all officers to publish anything because it was the copyright of the chief constable, although he is now in breach of the present chief constable's copyright? Is my right hon. and learned Friend further aware that Mr. Gregory arranged early retirement with a golden handshake of £50.000, and retired on 8 June, that the journalist with whom he collaborated left The Mail on Sunday to work with him full time from February, and that the first article appeared three weeks after his retirement? Will my right hon. and learned Friend investigate that scandal?
    Mr. Brittan: We cannot take action retrospectively to deal with the matters to which my hon. and learned Friend has referred. However, we must ensure that it never happens again.
    Mr. Snape: Does the Home Secretary agree that it is uniquely distasteful that Mr. Gregory could cash in on his own incompetence? Does not the incident illustrate that chief constables are not only non-accountable to elected representatives, but, from what the Home Secretary has said, are not accountable to him? Will he do something about that?
    Mr. Brittan: It would be wrong to draw general conclusions about chief constables on the basis of this episode, and there is no evidence for doing so. The fact that action is necessary has been recognised by the Association of Chief Police Officers. The hon. Gentleman did less than justice to the fact that the association readily denounced the activity, which has been universally condemned, and is considering ways of dealing with it. On reflection, the hon. Gentleman might think that greater prominence should have been given to that aspect of the matter if he wished to be fair to the entire police service.

    Animal Welfare
    Mr. Moateasked the Secretary of State for the Home Department what recent representations he has received urging legislation on animal welfare.
    Mr. Mellor: We have received a number of representations suggesting the need to reform the Cruelty to Animals Act 1876 and comments on the proposals for updating the Act contained in our recent White Paper, as well as a few proposals concerning other aspects of animal welfare.
    Mr. Moate: Is my hon. Friend aware that there was widespread expectation of legislation in the previous Parliament, but that all we got was the White Paper? Is he further aware that there was great disappointment that no such proposal was included in this year's Gracious Speech? As the Home Office now has a much-reduced legislative burden because of last night's vote, will my hon. Friend give the House a clear assurance that the Government will introduce legislation on this matter during the next Session of Parliament?
    Mr. Mellor: During the previous Parliament considerable progress was made. There was agreement on the Council of Europe convention on animal experimentation. Many of the animal experiments carried out in Britain depend upon the export trade, so we must have common standards in the Western world. That was a major step forward. The Department's advisory committee reported on standards in Britain, which enabled us to bring forward a White Paper dealing with the difficult question of drawing a fair balance between those who must carry out these experiments and those who are concerned for animals. After considering the responses to the White Paper, we hope to introduce legislation as soon as parliamentary time permits.
    Mr. Corbett: Does the Minister accept that the majority of the experiments carried out on animals are for purely flippant, literally cosmetic reasons? Will he give an undertaking that within this parliamentary Session, which
    1002
    ends a year next November, legislation will be brought forward to restrict and confine these experiments to serious scientific purposes?
    Mr. Mellor: It is all very fine for the hon. Gentleman to say that experiments are carried out for flippant reasons, but there is no reason to believe that that is true. On the contrary, the present system, with a Home Office inspectorate, has led to a decline in the number of experiments. If the hon. Gentleman takes the trouble to read the White Paper he will see that it represents a real step forward in the protection of animals, while ensuring the protection of the public through necessary experiments. I am surprised that the hon. Gentleman believes that the public do not need protection against dangerous products.
    Miss Fookes: May I tell my hon. Friend that I am tired of making excuses to constituents and others for the snaillike progress of the past four years? What guarantee can my hon. Friend give that there will be better progress this time?
    Mr. Mellor: We have published the White Paper, and representations on it will be received by the middle of August. The Government will then prepare legislation. I cannot say when it will be introduced, but I believe that it should be introduced as soon as possible.

    Immigration (Fiancés)
    Mr. Marlowasked the Secretary of State for the Home Department how many applications from fiancés from the Indian subcontinent to enter the United Kingdom for the purposes of marriage there have been so far in 1983; and what was the comparable figure for 1982.
    The Minister of State, Home Office (Mr. David Waddington): One thousand and seventy new applications for entry clearance were received from male fiancés in the Indian subcontinent in the first five months of this year, compared with 360 in the corresponding period in 1982. Those figures are broadly in line with the estimates given in the debate on the immigration rules.
    Mr. Marlow: Does not this threefold increase show that either the marriage habits in the Indian subcontinent have undergone some change or, alternatively, that marriage is being used as a means of migration to this country? Will my hon. Friend, in any event, reaffirm the statement made by the previous Government that the figures will be watched carefully and that if a change in legislation is needed it will be brought forward?
    Mr. Waddington: I remind my hon. Friend of what Viscount Whitelaw, as he now is, said during the debate on the immigration rules:
    "Our policy will be subject to continuous re-examination in the light of changing circumstances … in order to achieve our objective, which is strict immigration control." — [Official Report, 15 February 1983; Vol. 36, c. 191–212.]
    We stand by that statement.
    Applications by husbands and male fiancés are running at an annual rate of 3,624, which is 2,394 more than the total for 1982. That should be compared with the estimate that we gave during the debate on the immigration rules of between 2,500 and 3,000. Futhermore, we are talking about applications, not acceptances.
    Mr. Madden: Will the Minister ensure that the interviews are arranged at the earliest possible date and the

    1003
    applications are processed with expedition, and also that complaints about the standard of interviews are fully investigated by his Department, with a view to ensuring that they are conducted fairly and objectively?
    Mr. Waddington: I hope to go to the Indian subcontinent soon, because I wish to compare what I see there with what is being said by members of Select Committees who have investigated this matter and visited the Indian subcontinent in recent years. They have told the House that they have been greatly impressed by the work carried out by the entry clearance officers.
    Mr. Budgen: If, after a year, my hon. and learned Friend finds that the new rules are allowing a large and increased number of fiancés into this country, will he undertake to ensure that the rules are tightened?
    Mr. Waddington: I repeat to my hon. Friend what I said earlier. We are determined to stick to our policy of strict immigration control, and we shall keep our immigration policy under continual review so as to achieve that aim.

    Civil Defence
    Mr. Bill Walkerasked the Secretary of State for the Home Department how many local authorities have carried out surveys of the protective factor of residential accommodation as recommended in circular ES3/81.
    Mr. Hurd: No central record is kept. The new draft regulations laid on July 12 will, if approved, require local authorities to make plans for instructing and advising the public on protective measures to be taken against the effects of hostile attack.
    Mr. Walker: I thank my right hon. Friend for that reply. Does he agree that such surveys require a substantial resource base and, even using voluntary levy, the authorities concerned may require assistance? Will my right hon. Friend's Department see that discussions take place to ensure that this happens?
    Mr. Hurd: I agree with my hon. Friend. These surveys would attract civil defence grant in the usual way.

    Probation Service
    Sir David Priceasked the Secretary of State for the Home Department what plans he has for the future of the probation service.
    Mr. Mellor: My right hon. and learned Friend intends to support and encourage the service in the effective performance of its important tasks.
    Sir David Price: Does my hon. Friend agree that if serious overcrowding in our prisons is to be reduced there must be an increase in the number of convicted people going on probation and greater use of parole and attendance centres with, in consequence, a greater strain on the probation service? If these changes occur, and there is a general agreement that they should, must there not also be a general increase in the resources available to the probation service?
    Mr. Mellor: I agree with my hon. Friend, and there is that increase in resources. I remind hint that in the past four years the number of probation officers has increased by 11 per cent., the number of clerical support staff by 10
    1004
    per cent. and the number of ancillary workers who run the community service order scheme by 35 per cent. Before I hear too many jeers from the Opposition Benches, I point out that that is a far better record than any Labour Government achieved.
    Mr. Haynes: When will the Minister recognise that our courts wish to refer more and more people to the probation service, but cannot do so, because the service does not have the manpower to do the job properly? When will the Home Office stop interfering and messing about with the salary levels for probation officers, so that we can encourage people to go into the service?
    Mr. Mellor: I do not think that the hon. Gentleman can have listened to my previous answer. I wonder when last in a four-year period the number of people working in a service increased by so much. With great respect, the hon. Gentleman has got hold of the wrong end of the stick on the salary issue, which was concerned with a small number of Home Office-sponsored trainees. The probation service has amicably accepted the reasonable pay settlement offered to it for the coming year.
    Mr. Lyell: Will my hon. Friend do his best to liaise with the DHSS and other agencies to get people out of ineffective residential homes, which cost about £10,000 a year per person, and spend the money more effectively on rigorous forms of intermediate treatment that have about twice as good an anti-recidivism rate?
    Mr. Mellor: As ever, my hon. and learned Friend makes a valuable point. The amount of money being spent on intermediate treatment this year is double what it was last year. My hon. and learned Friend touches on another important aspect of this matter. It is not sufficient just to make further resources available—they must be used to the best advantage, and this is what we are Trying to achieve.
    Mr. Kilroy-Silk: Does the Minister accept that, although the number of probation officers has increased along the lines that he has suggested, there has been an even greater increase in their work load and responsibilities and in the number of serious cases that they are handling? Is it not a fact that in many areas non-custodial sentences cannot be implemented because of lack of probation officers to supervise? This particularly applies to the introduction of the new community service order for 16-year-olds. Will he assure us that no one will go to prison, or to a young persons' establishment — when they could be properly supervised in the community because of the lack of probation officers?
    Mr. Mellor: We are always vulnerable to the charge —one always is—that we could do more. I recognise the hon. Gentleman's expertise and interest in these matters, but, to be fair, he should recognise what we are achieving in bringing about the introduction of community service orders for 16-year-olds. In 14 areas this is already available and will be in 10 more at the end of the summer. I have just attended the conference of the Association of Chief Officers of Probation, and it is not making the same points as the hon. Gentleman. It recognises that probation officers have an increased work load, but equally recognises that it has had a fair deal from the Government in coping with that problem.

    Immigration
    Mr. Proctorasked the Secretary of State for the Home Department what progress he has made in his review of section 29 of the Immigration Act 1971; and if he will make a statement.
    Mr. Waddington: We are making good progress in reviewing the administrative criteria governing the operation of the repatriation scheme under section 29 of the Immigration Act 1971, and hope to reach conclusions shortly.
    Mr. Proctor: In the course of my hon. and learned Friend's review of this provision, will he take account of the growing demand from the ethnic communities—not from their self-appointed leaders—for further assistance in the form of resettlement grants for those who genuinely wish to go home? How will he respond to that demand?
    Mr. Waddington: The introduction of a resettlement grant would require primary legislation. The present arrangements provide adequate assistance for those who genuinely want to go, and the fact that few actively seek financial assistance for travel shows that few want to go. The vast majority of the members of the ethnic minority communities settled here want to stay and have no interest in repatriation.
    Mr. J. Enoch Powell: When other European countries such as West Germany and France are studying radically the consequences of the past large influx of alien population, is it not time for this country to move beyond the timidity and triviality of section 29?
    Mr. Waddington: The right hon. Gentleman is presumably referring to German guest workers and a scheme recently proposed by the German Government. There is no parallel between the situation in Germany and that here. The Germans are talking about people admitted on a temporary basis, but we are talking about people who, in the main, are settled here.
    Mr. Wilkinson: Is it not a fact that the great majority of those settled here are either Commonwealth nationals, and as such have equal rights with British citizens, or former Commonwealth nationals who have gone to the trouble of acquiring British nationality? That being the case, does it not behove us to make these people welcome and as fully a part of our society as possible?
    Mr. Waddington: I agree.
    Mr. Winnick: If repatriation is to take place, is the Minister aware that the people who need to be repatriated are race hate-mongers and mischief-makers, such as the hon. Member for Billericay (Mr. Proctor) who asked the question?
    Mr. Waddington: Offensive remarks of that nature do not help anyone. It is quite appropriate for us to speak our minds in the House, and it is perfectly proper for people who believe that there should be more scope for repatriation to say so. It is also my job to speak my mind, and I believe that the provisions now on the statute book are adequate.

    Dr. Clift (Evidence)
    Mr. Ashleyasked the Secretary of State for the Home Department when he intends to publish the results of his inquiries into the convictions in relation to which Dr. Clift gave forensic evidence.
    Mr. Brittan: When the inquiries have been completed to my satisfaction, I shall inform the House of the results.
    Mr. Ashley: In the meantime, may we take it that any other prisoners who have been convicted on Dr. Clift's discredited evidence will simply rot in gaol until the Home Office meanders its leisurely way to the end of the very long inquiries?
    Mr. Brittan: That is certainly not so. A number of the people concerned have already had their convictions quashed by the courts, so the right hon. Gentleman is not justified in making criticisms of that nature. Indeed, it is as a result of my Department's desire to look into these matters so fully that we are looking into 1,500 cases, 135 of them contested cases. Since the Preece case received wide publicity, we expected other people to come forward claiming that they had been wrongly convicted, but they have not done so. I assure the right hon. Gentleman that if any cases come to light in which a reference to the Court of Appeal is justified, or any other action of that nature, I shall immediately take action.

    Nuclear Shelters
    Mr. Parryasked the Secretary of State for the Home Department if he will now give details of the number of nuclear shelters on Merseyside and on the number of people they will hold.
    Mr. Hurd: It is for the local authority concerned to provide any public nuclear shelters. So far as we know, there are none on Merseyside. The new draft regulations laid on 12 July will, if approved, require local authorities to make plans for using existing buildings, other constructions and natural features as shelters for the public.
    Mr. Parry: Is the Minister aware that the general public feel that any shelters that are built will be used for VIPs, and that in the event of a nuclear attack they will be of no use to the majority of the people? Is he aware that civil defence will be useless in the event of a nuclear attack on our cities?
    Mr. Hurd: No, Sir. The nuclear deterrent works and, we believe, will continue to work. The risk of attack is not very great. However, it is sensible and necessary in our view to make plans, and to require local authorities to make plans, which could save lives and prevent suffering in the case of either nuclear or conventional attack.

    Police Constables (Training)
    Mr. Flanneryasked the Secretary of State for the Home Depatment what guidance he gives to chief officers as to the length of training a police constable should receive before he is considered sufficiently trained to go on the beat; and if he will make a statement.
    Mr. Hurd: Present guidance, approved by the Police Training Council in 1973, has been revised from time to time. The Police Training Council has now held a

    1007
    thorough review and has recommended a period of seven months, including 10 weeks on beat duties attached to an experienced tutor constable. My right hon. and learned Friend is considering this recommendation and hopes shortly to issue revised guidance to chief officers of police.
    Mr. Flannery: Is that not a totally insufficient period of training for young men and women who have to go out in uniform and face the most subtle and difficult problems in a society that is experiencing great difficulty? Does not the Minister agree that the qualifications are very low, and that we shall not be able to handle police-public problems until there is much longer training and much higher qualifications are demanded for entry to that training?
    Mr. Hurd: I am not sure that the hon. Gentleman listened to my reply. My right hon. and learned Friend has recently received, and is now considering, new proposals that recommended a period of seven months, including 10 weeks on beat duties attached to an experienced tutor constable. That is in the light of experience such as that to which the hon. Gentleman refers.
    Mr. Lawrence: Will my right hon. Friend give us some idea of the improvement in the number of polce officers on the beat now, as opposed to the time when we came to office?
    Mr. Hurd: Certainly. The report issued by the Inspectorate of Constabulary this week showed that the total is now 121,000—I speak from memory—which is a substantial improvement. It neans that almost all forces are close to their establishment.
    Mr. Freud: Will the Minister accept the value of keeping a police officer in one place? Will he re-examine the structure whereby the only way to get promotion is to move from the place that the officer knows to one that he does not know?
    Mr. Hurd: That is a matter for chief officers. I think the hon. Gentleman will agree that circumstances vary very much from one force to another and that it would be wrong to lay down a general guideline.
    Mr. Forman: Is my right hon. Friend convinced that a seven-months training period is long enough for the purpose, especially in areas of great difficulty such as the Metropolitan area? How does the seven-month period compare, for example, with police forces on the continent of Europe?
    Mr. Hurd: My right hon. and learned Friend will consider these matters when he looks at the new recommendations, but they are new recommendations put forward in the light of recent experience and developments, such as Lord Seaman's report.

  PRIME MINISTER

    Engagements
    Mr. Rookerasked the Prime Minister if she will list her official engagements for Thursday 14 July.
    The Prime Minister (Mrs. Margaret Thatcher): 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. Rooker: Will the Prime Minister, as leader of the nation and as a housewife, give us her practical advice and tell us what her practical advice is to the unemployed and their families about eating healthily within their means, in view of the assessment by the National Advisory Committee on Nutrition Education that the average British diet puts people at risk?
    The Prime Minister: I do not think that those people need advice from me, and I think that it would be presumptuous of me to give it.
    Mr. Marlow: Is my right hon. Friend satisfied that the United States is sufficiently representing Western interests in the middle east? If not, does she believe that Europe, and the United Kingdom in particular, should be taking an initiative in that area of the world?
    The Prime Minister: There is no improvement whatever to report on the situation in the middle east. It is very serious indeed. The European Community will be considering whether there is anything that we can say or do to help to bring peace and security to that region.
    Mr. Foot: When the right hon. Lady says that she is not prepared to give advice to some of the poorest people in the land, is that not what she sought to do last week? Has the Cabinet had a chance to consider the growing anxiety throughout the land about the way in which some of the poorest people may be treated under her Government? Will she give an absolute guarantee that supplementary benefit is to be sustained, because that provides the minimum needs that must be met if proper standards are to be sustained? Will the right hon. Lady give a guarantee that she will protect the standard of supplementary benefit throughout the coming years?
    The Prime Minister: No. I cannot go further than the pledge given previously in the manifesto that pensions and other long-term linked benefits would be protected. Supplementary pension is such a linked benefit, and is therefore protected.
    Mr. Foot: Does the right hon. Lady recognise that it is not only the protection of the standards of people on supplementary pensions; there are many other people who depend for a minimum standard of life on the protection of supplementary benefit? Does she accept that if unemployment continues to increase, as it has done under her Government, and if the value of the benefit is cut, as she is now suggesting, we shall soon have 8 million or 9 million people living on the poverty line? Is she content that such a thing should happen in this country?
    The Prime Minister: There is no definition of the poverty line — [HON. MEMBERS: "Oh!"] — and there never has been under any Government—when they have answered from this Dispatch Box. We gave a pledge in our manifesto that pensions and other linked long-term benefits would be price protected. I cannot extend that pledge.
    Mr. Foot: In the light of the anxiety, which can now only deepen as a result of her answers, will the right hon. Lady ask the Cabinet to look afresh at this matter to see whether the minimum standard of life of some of the poorest people in Britain cannot be guaranteed over the coming years?
    The Prime Minister: I cannot go further than what I have said. The retirement pension and other long-term

    1009
    linked benefits are price protected. Those long-term linked benefits include widows' pension, industrial death benefit when it is paid by means of a widow's or widower's pension, war disablement and industrial disablement pension, war widow's pension, attendance allowance, invalidity care allowance and non-contributory invalidity pension.
    Mr. Ian Lloyd: My right hon. Friend will be aware that successive Governments, including her own, have understandably refused to give the House or the country any information on the British world trade in armaments. As the annual report of the State Department to Congress contains a detailed analysis of British world trade in armaments, will she comment on, first, the relevance of that rule and, secondly, the disclosure in that report that of the $3·24 billion worth of arms supplied to the so-called front-line states, $1 billion has been supplied by the United Kingdom? Will she comment on that, particularly in the light of the fact that most of those states are bankrupt and, therefore, we can only assume that the bill has been met by the British taxpayer?
    The Prime Minister: If my hon. friend wishes to ask about a particular consignment, obviously we shall tell him. However, he knows that every order is looked at individually and on its merits. Certainly armaments have been supplied to the front-line states, but when each order was taken a judgment was made by whatever Government were in office as to whether, in all the circumstances, it was wise to meet it. That, again, has been the practice of every Government.
    Mr. Roy Jenkins: Can the right hon. Lady recollect an occasion previous to last night when a Prime Minister was so mercifully saved from his or her folly by the votes of so many wiser colleagues?
    The Prime Minister: I assume that the right hon. Gentleman used his freedom to vote in his own way. Does he seek to deny it to any other hon. Members of the House?
    Dr. McDonaldasked the Prime Minister if she will list her official engagements for Thursday 14 July.
    The Prime Minister: I refer the hon. Lady to the reply that I gave some moments ago.
    Dr. MacDonald: Where is the morality in squandering £280 million this year on tax cuts to the rich instead of raising child benefits by a further 50p per week and raising benefits for the unemployed?
    The Prime Minister: Child benefit, as the hon. Lady knows, will be at a record level when it is increased in November. That is better than anything achieved by the Government that she supported. I imagine that tax relief is the subject of the Finance Bill which is now going through the House. The 1 million people who will be better off as a result of the Finance Bill include one-sixth of all stevedores and dockers, one-sixth of all transport foremen, 5,000 miners, a quarter of all journalists, many working couples, half of all medical practitioners, the heads of many secondary schools, and half of all university academics.
    Mr. Bill Walkerasked the Prime Minister if she will list her official engagements for Thursday 14 July.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Walker: Has my right hon. Friend had the opportunity to read the press reports on the so-called public inquiry that was held by the Strathclyde region into the Coulport base for Trident, stating that the inquiry has been based on fundamental errors, which has led to a colossal waste of taxpayers' money and resources? Does my right hon. Friend agree that this is another example of a Labour local authority spending public money for political dogma?
    The Prime Minister: I have not read the complete report, but I have read the reports of it in Scottish newspapers. I understand that one of the defence economics lecturers at Strathclyde university said that it contained so many errors that it could not be seriously considered.
    Mr. Heddleasked the Prime Minister if she will list her official engagements for Thursday 14 July.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Heddle: Does my right hon. Friend agree that the road to home ownership passes through Bolsover and Birmingham, Sparkbrook? Is it not curious that some 18 months after the former agent of the hon. Member for Bolsover (Mr. Skinner) bought his council house, the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) made a speech this week agreeing that most council tenants want to buy their homes? Therefore, will my right hon. Friend take time today to invite Labour Members to condemn those Labour-controlled local authorities that are still denying council tenants the opportunity to exercise their democratic right?
    The Prime Minister: Yes, gladly. If council tenants live within the area of such a Labour council, they should apply directly to the Department of the Environment to seek help with the purchase of their home.
    Mr. Skinnerasked the Prime Minister if she will list her official engagements for 14 July.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Skinner: Now that Brazil is suggesting a moratorium on her debts and the right hon. Lady is making offstage noises about not bailing Brazil out, will she give a guarantee, in order that action can speak louder than words, that she will bring in legislation to force the Inland Revenue to stop allowing tax relief to banks on all bad and doubtful loans? The Labour party will give a guarantee to help get such legislation through and provide her with a bigger majority than we got on the hanging motion last night.
    The Prime Minister: Brazil is negotiating for another IMF tranche today and it is hoped that those negotiations will be completed by tomorrow. The President of Brazil made a statement today. We have not seen its full text but it looks as if Brazil has taken certain action. That may or may not mean that the next slice of IMF aid will be released. [Interruption.] I am trying to answer the hon. Gentleman's question.
    If any Government were to refuse tax relief on bad debts to banks, the effect on British banks and those who deposit with them would be calamitous.
    Mr. Geoffrey Finsberg: When my right hon. Friend has further meetings with her colleagues today, will she

    1011
    invite them not to enter into consultation with the new phoney Association of London Authorities, which is merely a front organisation for the Labour party, but to continue consultations with the long-established London Boroughs Association?
    The Prime Minister: Yes, I completely agree with my hon. Friend. I shall pay due regard to his warning and also consult our many London Members in the House.
    Mr. Foulkes: Has the Prime Minister had an opportunity to read the proceedings of the Select Committee on Foreign Affairs, which contains the draft report of its chairman, her distinguished hon. Friend the Member for Stroud (Sir A. Kershaw)? As that draft report says that Fortress Falklands is untenable in the long term, will she give a clear indication now under what circumstances and in what conditions she and her Government would be willing to enter into discussions with a future democratic Government of Argentina about the future of the Falklands?
    The Prime Minister: I understand that this is an uncompleted draft report to which the Government are not required to give a formal reply. However, we have noted that the draft conclusions end with the firm statement that:
    1012
    "Your Committee cannot yet recommend the resumption of negotiations with Argentina on the sovereignty issue or any matters relating thereto."
    I see no prospect of entering into negotiations with Argentina at present, and I have no intention of negotiating sovereignty.
    Sir Ian Gilmour: Although I agree with my right hon. Friend that there is no acceptable definition of poverty, does not she accept that the fact and presence of poverty is not in doubt? Since those who receive short-term benefits are at least as poor as those who receive long-term benefits, will she give an assurance that the fact will be fully taken into account when the Cabinet next considers public expenditure?
    The Prime Minister: As my right hon. Friend will know, many of those who receive short-term benefits receive supplementary benefit if the amounts are inadequate for their purposes. For example, the unemployed often receive a rather larger proportion of their income from supplementary benefit than from unemployment pay. However, I cannot go further than the promises that I have given, upon which my right hon. Friend fought the last election.

Malta (Arrest of British Citizen)
3.30 pm
Mr. Ted Rowlands(by private notice) asked the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the arrest of a British citizen, Mr. Anthony Price, by the Maltese authorities.
The Under-Secretary of State for Foreign and Commonwealth Affairs (Mr. Ray Whitney): Mr. Anthony Price, a British citizen who was visiting Malta, was detained by the Maltese police on 13 April and, despite strong diplomatic and legal representations, held until 20 June, without charges being preferred. Mr. Price was released on that date by order of a magistrate, but the authorities did not allow him to leave the island. While he was still trying to get the courts to uphold his right to leave Malta he was rearrested on 11 July and charged yesterday with conspiracy to subvert the Government of Malta. We shall continue to provide him with appropriate consular assistance and press for a speedy trial. The preliminary hearing has now been set for 27 July.
Mr. Rowlands: I should like to express my gratitude and that of Mr. Price's parents to the Under-Secretary of State. The House will know that his parents are beside themselves with worry. However, I thank the hon. Gentleman for the patient efforts that have been made for more than 70 days to resolve the utterly bewildering and bemusing behaviour of the Maltese authorities. Will the hon. Gentleman simply confirm that all the evidence available to him and his office shows that there is not a shred of truth in the allegation or charge made against
1014
Anthony Price that he was in any way involved in trying to subvert the Maltese authorities? Will he also confirm that this trumped-up charge has been brought to justify the Maltese authorities' incredible behaviour, in that for 70 days or more they have prevented one British citizen from leaving Malta?
Mr. Whitney: I am grateful to the hon. Gentleman for his appreciation of the help that has already been given to Mr. Price. We totally share his concern about this affair, and in particular the fact that he was detained without charge for such a long period. As far as evidence is concerned, at this stage it will be a matter for the Maltese courts to decide.
Sir John Biggs-Davison: In view of Malta's splendid record, particularly in the second world war, is it not very sad that there should be so many breaches of human rights in that Commonwealth country? Will Her Majesty's Government seek with our Commonwealth partners, to bring pressure to bear in order to secure decency in that country which we love so much?
Mr. Whitney: As my hon. Friend is aware, the Government's record on human rights in Malta and elsewhere is well known, well substantiated and actively pursued.
Sir Anthony Kershaw: Is my hon. Friend aware that the disgraceful and hysterical conduct of Mr. Mintoff has often given great cause for anxiety? Will he pursue this case with the greatest energy?
Mr. Whitney: As I pointed out in my statement, we are most certainly pursuing as far as possible any consular help that we can give to Mr. Price, and we shall continue to do so.

Business of the House
3.33 pm
Mr. Michael Foot: Will the Leader of the House state the business for next week?
The Lord Privy Seal and Leader of the House of Commons (Mr. John Biffen): The business for next week will be as follows:
MONDAY I8 JULY — Second Reading of the Telecommunications Bill.
Motion relating to the Local Government (Direct Labour Organisations) (Competition) Regulations.
Motion on the British Shipbuilders' Borrowing Powers (Increse of Limit) Order.
TUESDAY I9 JULY—Debate on a motion to approve the statement on the defence estimates 1983, Cmnd. 8951.
Motions on Members' pay and allowances.
WEDNESDAY 20 JULY—Conclusion of the debate on the statement on the Defence Estimates.
The House will be asked to pass all outstanding Estimates.
Motion on the Equal Pay (Amendment) Regulations.
Motions on Northern Ireland orders on housing benefits, housing and housing (consequential amendments).
THURSDAY 2I JULY—Motions on the rate reduction reports 1983–84 on the (Kirkcaldy district), the (Glasgow district), the (Stirling district) and the (Lothian region).
Proceedings on the Medical Bill [Lords], the Car Tax Bill [Lords] and on the Value Added Tax Bill [Lords] which are consolidation measures.
FRIDAY 22 JULY—Private Members' motions.
MONDAY 25 JULY — Motion on the summer Adjournment.
Proceedings on the Consolidated Fund (Appropriation) Bill.
The House will wish to know, Mr. Speaker, that, subject to progress of business, it is hoped to propose that the House should rise for the summer Adjournment on Friday 29 July.
Mr. Foot: The right hon. Gentleman has already made some changes in the extremely crowded programme that he originally proposed to put to the House, and I am grateful to him for that. However, there are still some alterations that could be made that would be of great benefit to the House. We hope that the motion on the regulations concerning local government that have been set down for Monday can be postponed. I hope that the right hon. Gentleman will consider that.
The Government have an extremely wretched record on women's rights and equal pay. They have harmed many of the rights previously established and we therefore believe that further and better time should be given to discuss the proposal on equal pay, as it could have controversial aspects to it.
Will the right hon. Gentleman consider afresh the proposition that I put to him last week about a debate on the economic package that the Chancellor of the Exchequer presented to the House? Perhaps he will comment on that. Given the Prime Minister's answers today, and the statements that have come from the Government on various aspects of the issue, will the right hon. Gentleman guarantee that the benefit uprating regulations will be given full and prime time for discussion
1016
by the House? There is growing anxiety in the country about the way in which the Government are dealing with all such questions.
I hope that the right hon. Gentleman will add some of the changes that I have suggested to those that he has already made.
Mr. Biffen: I accept at once that next week's business provides a very full programme. It shows why the House is working through to the end of the month.
We are prepared to consider through the usual channels the anxiety that has been expressed about the local government debate that is proposed for Monday, and the same is true of the representations made about the equal pay regulations. However, I hope that the Leader of the Opposition will allow me to dissent entirely from his ungenerous premise about the Conservative party's record on that topic.
I note what the right hon. Gentleman has said about the benefit uprating regulations, and I shall certainly bear that in mind when that issue is considered. Doubtless there will be consultations through the usual channels.
The right hon. Gentleman requested a debate on the very wise economic measure that was announced by my right hon. Friend the Chancellor of the Exchequer a week ago. However, the House will recollect that on that occasion the statement was subject to a very full examination and since then we have had quite a while to consider it in the context of the Finance Bill. I note the interest and suggest that we continue to discuss the matter through the usual channels.
Mr. Edward du Cann: Will my right hon. Friend be good enough to reconsider the arrangements that he is proposing to the House for dealing with the Supplementary Estimates totalling about £1,000 million, on Wednesday night? If he proposes to deal with them formally, does he agree that there is something improper about inviting the House to pass, on the nod, expenditure of such magnitude without proper surveillance, scrutiny or discussion? Would not it be better to postpone the passage of the Supplementary Estimates at least until the Select Committees are reappointed and the necessary scrutiny can be given to that expenditure? Alternatively, could we make other arrangements so that we can have a full discussion about the way in which the House proposes to spend taxpayers' money?
Mr. Biffen: My right hon. Friend makes an important point. He will understand that I have a great deal of sympathy with it, but what is proposed for next Wednesday derives entirely from the absence of the departmental Select Committees and the Liaison Committee. I can give my right hon. Friend the full-hearted assurance that what is proposed is entirely to do with the current situation and should not in any sense be taken as a precedent. I shall consider my right hon. Friend's question.
Mr. A. J. Beith: Will the Leader of the House arrange for the Secretary of State for Education and Science to make a statement to the House about the implications of the Chancellor's statement on cuts in education, especially since the Prime Minister wrote during the election campaign to one of her constituents saying that she intended that spending on the universities should remain at the same level after 1984–85?

1017
I thank the Government for responding to the request that originated from this Bench that the equal pay motion should be taken on the Floor of the House and not in a Statutory Instruments Committee.
Mr. Biffen: I am always grateful for such compliments as are paid in this wearisome world. I shall draw the hon. Gentleman's concern about the statement to the attention of my right hon. Friend the Secretary of State for Education and Science.
Mr. Norman St. John-Stevas: In view of the motion that the Leader of the House has placed on the Order Paper on the difficult question of Members' pay and conditions, does my right hon. Friend recall the pledge that I made to the House on behalf of the Cabinet of which he and I at the time were members that, save in the most exceptional circumstances, the recommendations of the independent review committee would be implemented? Am I to understand that that promise is no longer operative?
Mr. Biffen: I am sure that that matter will be thoroughly debated on Tuesday evening.
Mr. Mark Fisher: Will the Leader of the House find time for a debate on the operational control of nuclear weapons and missiles in Britain? Is he aware that many hon. Members believe that before we rise for the recess we should have the opportunity to debate the exact arrangements for operational control, the level at which they happen and what contingency arrangements the Prime Minister has in mind? The statement that the Prime Minister made to the House in answer to questions did not explain exactly how the operational control would work.
Mr. Biffen: Subject to the Chair's decision, I should think that the speech that the hon. Gentleman wishes to make could be made during the two-day debate on the defence Estimates.
Sir Antony Buck: Is my right hon. Friend aware that we are grateful for the fact that there is to be a two-day debate on the defence White Paper, which reverts to the earlier practice? May we have an assurance that the tradition of having single service days will be maintained so that in the autumn we can have a full day's debate on each of the services?
Mr. Biffen: I note what my hon. and learned Friend says. Perhaps he will allow me to defer any more substantive comment until the autumn.
Mr. Robert Parry: Has the Leader of the House seen early day motion 21 about the execution of Baha'i men and women in Iran which has been signed by 120 hon. Members on both sides of the House? Will the Government make the strongest protest to the authorities in Iran against the persecution and murder of those unfortunate people on the ground of religion?
[That this House condemns the cold-blooded executions by the Iranian Government of 10 women and six men of the Baha'i faith; and calls upon Her Majesty's Government to make strong protests against these executions.]
Mr. Biffen: I recognise the hon. Gentleman's interest in the topic and I shall, of course, refer his remarks to my right hon. Friend the Foreign Secretary.
Mr. Roger Sims: Does my right hon. Friend realise that it is difficult to reconcile his role as Leader of the House and defender of Back-Benchers with the terms of the resolutions on Members' salaries and conditions? Will he reconsider the terms of the resolutions and put forward proposals that recognise the logic and justice of the Plowden report as well as the need for a reasonable degree of respect?
Mr. Biffen: I recognise my hon. Friend's feelings. The motions are now before the House, but at the end of the day the House must decide whether to accept them.
Mr. George Foulkes: What arrangements has the Leader of the House made for regular meetings of the Scottish Grand Committee to be held in Edinburgh in this Session?
Mr. Biffen: To date, none. If I had clear evidence that there was a preponderant desire for that, of course I should consider it because it is not a matter on which any Leader of the House would have a closed mind.
Mr. John Stokes: In view of the votes last night on the death penalty, will my right hon. Friend give an assurance that the Government will not cease to protect the poor and the unimportant in our society? Will he also never forget that we are Members of the House of Commons and represent the common people as well as the intellectuals and progressives and all the talkers in the media?
Mr. Biffen: I am more than delighted to give that assurance. It is appropriate to record also that, whatever one's views on capital punishment, it must be a unifying factor throughout the House that there is a great and overwhelming determination to provide a proper structure for the protection and defence of law and order.
Mr. Richard Caborn: Will the Leader of the House consider early day motion 73 which extends good wishes to Nelson Mandela on his 65th birthday?
[That this House extends its good wishes to Nelson Mandela on reaching his 65th birthday on 18th July; and calls upon the South African Government to release him from imprisonment forthwith to enable him to play a full part in the struggle to achieve the free, democratic and unracial South Africa which has been his life and work.]
Does the right hon. Gentleman agree that it is appropriate, after the decision by the MCC yesterday, that the House should be able to express its opposition to the apartheid system in South Africa? Is not it appropriate that that should be done by sending Nelson Mandela best wishes on his birthday since he has stood against the apartheid regime? Will the Leader of the House find time for a discussion on that subject?
Mr. Biffen: The hon. Gentleman obviously feels strongly on that subject, and that is proper. I suggest that he tries his good fortune in the arrangements for the Consolidated Fund (Appropriation) Bill debate on Monday week.
Mr. Eldon Griffiths: May I refer to the question by my right hon. Friend the Member for Taunton (Mr. du Cann) and ask two questions about Select

1019
Committees? First, when does he expect that they will be set up again and what is holding up the decision? Secondly, is my right hon. Friend aware that reference has been made to a draft report which has not been fully considered? Many scores of amendments remain to be debated and no final vote has been taken. Why did the report have to be published? Will he put that point to the Procedure Committee because I am sure that it affects the deliberations of many Select Committees?
Mr. Biffen: The answer to the second question may be that the decision to publish is within the competence of officers of the Select Committees. I shall look into the matter and be in touch with my hon. Friend. On the more general issue of departmental Committees, the reason for not immediately establishing the Select Committees was set out in my speech at the end of the debate on the Loyal Address. I hope that we can proceed in the autumn.
Several hon. Members rose—
Mr. Speaker: Order. I propose to call those hon. Members who are rising now.
Mr. David Winnick: Does the Leader of the House recognise the need for a wide-ranging debate on Northern Ireland and its future? Will he bear in mind that if the events now taking place there were taking place on the mainland on anywhere near the same scale, and if they involved murder and all the other crimes occurring in Northern Ireland, there would be no hesitation about having not just one debate, but a series of debates? Why, therefore, is there reluctance to debate Northern Ireland? If we will not initiate such a debate before the House rises, can he give a promise that it will be one of the first priorities when the House returns?
Mr. Biffen: Any Leader of the House is under pressure to hold debates on a variety of subjects, which in their totality could not conceivably be encompassed within the time available.
The business that I have just announced covers the week when Northern Ireland questions come up for answer and the debate on the Consolidated Fund (Appropriation) Bill, when the hon. Gentleman may raise this issue. I recommend that he take that course.
Mr. W. Benyon: Further to my right hon. Friend's reply to my hon. Friend the Member for Bury St. Edmunds (Mr. Griffiths), is it not a most
extraordinary quirk of our procedure that the appointment of Select and other all-party Committees is being held up by the archaic election procedures of the Labour party? Why does he not move a motion that the Conservative and minor party representatives on these Committees be appointed and let the dear old Labour party chip in when it is ready?
Mr. Biffen: My hon. Friend should not be so tempting. He will recollect that in my speech at the conclusion of the debate on the Loyal Address I said specifically that it was not the electoral procedures of the Labour party that were responsible for the Government wishing to wait until this autumn before establishing the departmental Committees. I re-emphasise that.
Mr. Dennis Skinner: Is the Leader of the House aware that the Petroleum Royalties (Relief) Bill, which provides for the abolition of royalties, and allows the marginal oilfields—in private hands, of course—to
1020
operate with Government assistance, is before the House? He should be consistent and encourage the Cabinet to look at the possibility of a parallel Bill to provide assistance to marginal pits.
Mr. Biffen: In a spirit of end-of-term generosity, I will refer that suggestion to my right hon. Friend the Secretary of State for Energy.
Mr. Anthony Steen: The matter I raise with the Leader of the House is of importance to all hon. Members and concerns whether answers to written questions should be received by the Press Gallery before they are received by the Members of Parliament who asked them. I refer particularly to what happened on last Tuesday, 12 July. I had tabled four questions to the Department of Transport and three to the Secretary of State for Defence.
There was no answer on the Letter Board by 5 pm, and by 5.30 pm television and radio companies in the southwest were calling me for a comment on the answers to the questions. I had to ask them what the answers were. At 6.30 pm I called on the Secretary of State for Transport and the Defence Department—
Mr. Speaker: Order. I think that the hon. Gentleman has asked his question.
Mr. Steen: I just want to explain the events, Mr. Speaker, so that hon. Members on both sides—
Mr. Speaker: Order. This is business questions.
Mr. Steen: Will the Leader of the House please investigate the system within the House by which questions sent by Departments can reach the Press Gallery sooner than Members of Parliament?
Mr. Biffen: If my hon. Friend will let me have the details of the problems that he has encountered, shall have those matters investigated.
Mr. Robert N. Wareing: Bearing in mind the refusal of the Prime Minister to publish the CPRS report, and given the growing suspicion on Merseyside that she has something to hide because the report predicted the discontent in Toxteth 12 months before it occurred, will the Leader of the House carry out the quasi-promises that he made last week to my right hon. Friend the Leader of the Opposition? These were that we should have a full debate on the report of the Select Committee on the Environment on the events leading up to the problems on Merseyside? That would enable the Prime Minister—
Mr. Speaker: Order. The rule applies to the hon. Member as it does to the hon. Member for South Hams (Mr. Steen). This is business questions. It is not the time to make long statements.
Mr. Wareing: May we debate the advantages of council house sales to people in my constituency where 40 per cent. of the adult population is unemployed?
Mr. Biffen: The hon. Gentleman makes this week the point that he put to me with force last week. I am afraid that I can give no different answer from the one that I gave last week.
Mr. Robert Adley: Does my right hon. Friend recall that part of the Gracious Speech, referring to Hong Kong, stated clearly and properly that Parliament

1021
would have shortly to make up its mind on difficult questions. As the talks are progressing and I believe that the latest stage finished yesterday in Beijing, will my right hon. Friend consider representing seriously to the Foreign Secretary that it is about time that he made a statement to the House about what is going on. Many hon. Members may well be surprised at what is happening. The Government will be well advised to prepare people for what we may have to face in future.
Mr. Biffen: I note what my hon. Friend says. I shall see that his views are conveyed to my right hon. Friend the Foreign Secretary.
Mr. Peter Bottomley: Does my right hon. Friend intend to put forward on Tuesday the Government's views on long-term arrangements for dealing with the pay of Members of Parliament?
Mr. Biffen: The debate clearly will be on the resolutions that will be before the House for determination. However, I have no doubt that the debate will run rather wider than that.
Mr. Andrew MacKay: Is my right hon. Friend aware that again this afternoon, during Home Office questions, a large number of Conservative Members expressed their considerable anxiety about the disfranchisement of electors who are away on holiday during elections? Does he agree with me that it is important that we should have a debate before we rise for the summer recess, bearing in mind that there will be municipal elections in certain parts of the United Kingdom next May and European elections throughout the United Kingdom in June?
Mr. Biffen: The Consolidated Fund (Appropriation) Bill will give hon. Members an opportunity to raise that issue. I recognise the interest that there is in it and the desire for legislation during this Parliament's lifetime.
Mr. Barry Porter: Will my right hon. Friend take note that some Conservative Members will be less than happy with the reply that he gave to the hon. Member for Walsall, North (Mr. Winnick) relating to Northern Ireland business? Many of us would welcome an opportunity for a full debate, especially in view of the demonstrable failure of the Nothern Ireland Assembly.
Mr. Biffen: There is simply no prospect of such a debate before we rise for the recess. I take note of the representations that have been made on this topic. They will be considered when we return in the autumn.
Mr. Harry Greenway: Is my right hon. Friend aware of the difficulties that hon. Members face in obtaining answers on the difficult and increasing problem of glue sniffing? Is he aware that they are being shunted between the Secretary of State for Social Services,
1022
the Secretary of State for Education and Science and the Home Secretary? Will he take steps to ascertain which Minister is responsible for handling the matter so that something can be done?
Mr. Biffen: I shall certainly look into the point that is exercising my hon. Friend and I shall get in touch with him.
Mr. John Wilkinson: May I draw my right hon. Friend's attention to early day motion 74 in the name of my hon. Friend the Member for Gosport (Mr. Viggers) and 108 right hon. and hon. Members on both sides of the House which pays tribute to our former friend and colleague Mr. Keith Wickenden, the former Member for Dorking, who was killed so tragically in a flying accident last Saturday, and extend our sympathy to his wife and family?
[That this House expresses its deep regret at the untimely death of Keith Wickenden on 9th July; records its appreciation of his contribution to the House and his friendship with many whilst Member of Parliament for Dorking from 1979 to 1983; and extends its sympathy to his widow and family in their loss.]
Mr. Biffen: I gladly use this occasion to add my sentiments to those expressed by the motion. All who served in the House of Commons with Keith Wickenden were greatly privileged to have had his companionship.
Mr. Neil Thorne: When is the Joint Committee on Statutory Instruments likely to consider the draft Civil Defence (General Local Authority Functions) Regulations 1983? Is it likely to be before the summer recess? The matter has been postponed once and is now considered most urgent.
Mr. Biffen: That is a middle stump question. I do not know the answer, but I shall look into the matter at once.

Consolidated Fund (Appropriation) Bill
Mr. Speaker: Order. I have a short statement to make about arrangements for the debate on the motion for the Adjournment that will follow the passing of the Consolidated Fund (Appropriation) Bill on Monday 25 July.
Hon. Members should submit their subjects to my office not later than 9 am on Wednesday 20 July. A list showing the subjects and times will be published later that day. Normally, the time allotted will not exceed one and a half hours, but I propose to exercise a discretion to allow one or two debates to continue for rather longer, up to a maximum of three hours
Where identical or similar subjects have been entered by different hon. Members whose names are drawn in the ballot, only the first name will be shown on the list. As some debates may not last the full time allotted to them, it is the responsibility of hon. Members to keep in touch with developments if they are not to miss their turn.

Council of Fisheries Ministers
4.2 pm
The Minister for Agriculture, Fisheries and Food (Mr. Michael Jopling): With permission, Mr. Speaker, I wish to make a statement on the Council of Fisheries Ministers meeting in Brussels on 11 and 12 July. Together with my right hon. Friend the Secretary of State for Scotland and my hon. Friend the Minister of State in my Department, I represented the United Kingdom.
After further lengthy discussions the Council could not reach agreement on the package of proposals for total allowable catches, quotas, associated conservation provisions and structural implementing measures which were under consideration. Nor was it possible, because one member state invoked its vital national interest, to reach agreement on interim measures that would have permitted fishermen from member states and from Norway to continue fishing for North sea herring.
However, the principal problem was on North sea herring and it was agreed that a Commission group of experts should be asked to carry out an urgent study of the allocation of quotas for that stock. This is a technical study and it is clearly established that the group will be concerned only with the application of the criteria laid down in the Council declaration of 30 May 1980. The work will he completed in time to report to the Council at its next meeting, now scheduled for 25 and 26 July. In the meantime, fishing for herring in the North sea by those member states that have exhausted their interim quotas and by Norway will cease.
I took the opportunity to press the Commission on the need for more rapid implementation of the arrangements for enforcement. I am glad to say that the Commission undertook to have at least some of its inspectors in post by the end of September and to have log books in operation before 1 November. Those will be significant steps towards more effective control, to which I attach considerable importance.
Mr. Norman Buchan: Does not the Minister agree that during the past few weeks the common fisheries policy has become a complete shambles, that it has collapsed at the very first hurdle and come apart at the seams? Everyone recognises that. How can it be denied that the policy could not work when the allocation of quotas was left until the very last minute and when the inspection system is not yet in force?
The right hon. Gentleman spoke about his hopes for effective control and policing and said that some of the inspectors would be in post by the end of September. Yet there will be a total of only 13 inspectors for the entire EC waters. Is not that nonsense? What reason is there to believe that the same story will not be repeated year after year and species after species? Is that not the whole point of the first sentence of the second paragraph of the Minister's statement? He said:
"the Council could not reach agreement on the package of proposals for total allowable catches, quotas, associated conservation provisions".
The matter is serious.
The policing problem has affected not only us but the Norwegians, with whom we have an agreement. It was not their fault that overfishing took place—it was the fault of our EC partners. Is it not true that the policing is wholly
1024
inadequate? The Minister said that some of the 13 inspectors would be in post by September, yet were not the original proposals for 39 inspectors?
Is it not ironic that the fishermen themselves had to go to Brussels to plead for policing? Is that not something that the Government should initiate on behalf of the fishermen? Is it not time that we took over full control of the 200-mile zone—that we could have were we not in the EC—and at least exercised policing duties in our own waters?
The Minister did not mention the effect of his statement on the fishing industry of the west coast of Scotland, where the fishermen are terrified of pressure from fishermen from other areas both outwith and within the United Kingdom. Will the right hon. Gentleman take action to deal with one large gap? What is there to prevent Norwegian, Faroese and other fishermen with quotas of up to 7,000 or 8,000 tonnes fishing above the quotas and discharging their fish into foreign klondikers for trans-shipping? Were we not promised legislation to close that loophole? If the Minister will introduce such legislation next week, we shall give him every support. I wish that he had the resolution to do so.
If there were a sudden increase in heavy fishing during the next week or two, would there be anything to prevent such a glut affecting our ability to deal with the marketing of the fish and, therefore, it being slanted off to the foreign klondikers, which would mean that the entire additional value would be lost to Britain?
When the common fisheries policy was introduced by the Minister's predecessor he described it as a deal that would last for 20 years. Will it? He described it as a superb deal. Is it?
Mr. Jopling: The hon. Gentleman asked many questions. He spoke first of the common fisheries policy collapsing, coming apart at the seams and being a shambles. That is not true. The agreement at which we arrived on 25 January on quota percentages, access and technical conservation measures was of crucial importance to the future of the Community's fisheries. In general, that agreement is being observed. I stand entirely by what my predecessor said about the agreement providing a framework for the next 20 years.
The hon. Gentleman said that policing was inadequate and that the United Kingdom should carry out its own policing. Each member state does its own policing to 200 miles or to the median line. If the hon. Gentleman is making allegations about the inadequacy of the British policing force and our fisheries protection service, I would be glad to hear full details of his complaints. The fishing community is a great deal more pleased than the hon. Gentleman about the undertaking from the Commissioner on dates of application of the inspectorate of existing national inspectors. He said that originally there were to be 40 inspectors. That number included secretaries and others. Therefore, the figure he gave was artificial. We shall have to wait and see what happens when the 13 inspectors are in post.
There are, of course, various quotas for individual states in the west of Scotland herring fishery. We shall police that area carefully to ensure that the fishery is not overfished. If we find abuses, we shall not hesitate to bring those who broke the law to our courts.
Sir Walter Clegg: Is my right hon. Friend aware that the increase in the inspectorate will be

1025
welcomed by the fishing industry? Is he further aware that the industry is angry about enforcement because the quota system cannot stand on its own without proper enforcement facilities? He can expect every back-up from the House to increase the efficiency of the inspectorate.
Mr. Jopling: I hope that my hon. Friend will agree that our fishermen are not concerned about the policing in British waters; they are concerned about the standard of policing by other states of their waters. If anyone has any complaint about our fisheries protection service I shall be glad to hear them. The chief purpose in setting up the super-inspectorate is to ensure that other states are carrying out their policing properly.
Mr. Donald Stewart: Is the Minister aware that the two statements that he has made since taking office show that the common fisheries policy will run on the same lines as the common agricultural policy? The Minister comes to the House deploring the effects of that policy and yet he is unable to do anything about it.
With regard to the fallback position on the west coast, about which he spoke in his last statement, is he aware that fishermen are afraid that the stocks that have been safeguarded for six years, and which are only beginning to recover, will be decimated again? Will he guarantee that at least the protection by the United Kingdom will be ample to prevent the stocks being wiped out?
Mr. Jopling: We shall do our utmost to ensure that the stocks in our own waters are properly conserved by our own fisheries protection force. I cannot accept what the right hon. Gentleman said about the common fisheries policy being in tatters. In general, the agreements that were made on quotas and total allowable catches for the huge majority of stocks in Community waters are being observed by individual countries. Access to our waters is being controlled, which has been a huge step forward. I do not hear complaints about that. I think that everyone has understood that it was impossible to make a deal over herring in the North sea last January because, as the right hon. Gentleman said a moment ago, the fishery had been closed for six years. We always knew that this would be difficult and so it has been.
Sir Michael Shaw: Will my right hon. Friend not take too much notice of the entirely negative but, alas, customary reaction from the Opposition? The difficulties of the fishing agreement are apparent to all, but progress has been made. Will he take note that fishermen — certainly those in my constituency — are chiefly concerned about policing? They are not satisfied that other nations will carry out policing as efficiently as ourslves. I hope that we can make progress on this matter.
Mr. Jopling: I take careful note of what my hon. Friend has said. The industry was pleased to hear that we have at last got the Commissioner to put firm dates on the placing of inspectors in post and on the use of log books.
Mr. James Wallace: Does the Minister agree that it is a sad reflection on the common fisheries policy that we have reached the stage where a ban on fishing is welcomed by fishermen? Is he aware that, six to seven months after the agreement on the common fisheries policy was reached, there is still no effective policing? Is he further aware that many Scottish skippers
1026
believe that there has been considerable overfishing by Dutch and Norwegian skippers? If agreements are reached on quotas when the Ministers next meet on 25 and 26 July, will it be their intention to open up the North sea fishing grounds again some two months before even a small number of the enforcement provisions, which have been promised by the end of September, come into operation? Can United Kingdom fisheries protection officers board the eastern European klondikers to check the level of catches trans-shipped to them by Norwegian vessels?
Mr. Jopling: On the hon. Gentleman's final point, if foreign ships are fishing in British waters, which come under the jurisdiction of our fisheries protection force, it can carry out the necessary investigations. If the law is being broken it can bring them to the courts. I was interested in the hon. Gentleman's opening remarks because I, too, noticed a report in The Guardian this morning that the chief executive of the Scottish Fishermen's Federation had welcomed the reimposition of a complete ban on the taking of herring in these circumstances. The hon. Gentleman made the allegation that others have made, but which none has substantiated, when he suggested that policing in our waters is ineffective. If the hon. Gentleman has specific cases to bring to my notice I would be anxious to hear about them. Finally, the hon. Gentleman asked whether, if we reach agreement on North sea herring on 25 and 26 July, we shall be opening that fishery again. I hope that that will be possible. I hope that we can get agreement on the broad package and open that fishery once more.
Mr. Kenneth Warren: I applaud my right hon. Friend's recognition that policing is the essence of the success of the common fisheries policy. Will he, however, at the next Council meeting call the bluff of the other member states to make them table exactly what they propose to do, to allocate specific dates when they will carry out their proposals, and to see whether they will co-ordinate with us a system of policing that will bring to bear all the available air and naval resources to make the common fisheries policy work?
Mr. Jopling: I get the feeling that it is the general desire of the member states and their Ministers to make the policy work, and to have adequate conservation measures so that stocks can be built up over the years. There is disquiet, as my hon. Friend said, at the standard of policing. I hope that when log books are fully in use by skippers and we have a super-inspectorate we shall see a reduction in the number of complaints about the standard of policing by other states.
Mr. Austin Mitchell: The problems relating to North sea herring arose after a long ban was lifted at four days' notice and then heavy overfishing of quotas was allowed. Now we have this mess. Does this not show the complete inability of EC institutions to handle fishing matters? Grimsby fishermen believe that Norwegian fishing for herring should be allowed to continue so that there is no danger of retaliation against Grimsby vessels in Norwegian waters that are currently fishing at their seasonal high. As the herring pickle is holding up all other total allowable catches and quotas, why does not the Minister take the obvious step? Why does he not take this matter from the incompetent, dithering hands of the EC and impose his own allocations on vessels in our waters instead of supinely sitting there?
Mr. Jopling: I do not do so because I believe that we should concentrate on maintaining the rule of law within the common fisheries policy. If we were to start breaking the law it would be difficult for us to lecture others. There was a proposal before the Council that we should allow Norway to continue to fish North sea herring, although all the other member states would have had to stop. I do not think that our fishermen would have accepted that proposal. They would have been extremely annoyed. We were successful in blocking that. I hope very much that the Norwegians, who, like the rest of us, are having to stop fishing for herring in the North sea, will be patient until the next meeting of the Council, when, I hope, we shall reach agreement on the whole package.
Mr. David Harris: Does my right hon. Friend accept that anyone who has considered these matters agrees that the implementation of the common fisheries policy was bound to take time? I welcome my right hon. Friend's move in at least starting the enforcement of the measures, but will he please take note of pleas from Conservative Members to put more effort into the inspectorate? Thirteen inspectors are not enough. It is a matter not only of numbers but of the powers that those inspectors will have. Will my right hon. Friend consider the matter urgently?
Mr. Jopling: We shall continue to press the Commission to establish and strengthen its inspectorate. Let us see how we get on with the 13 inspectors when they are in place and how the arrangement works. I agree with my hon. Friend when he says that the full establishment of the common fisheries policy was sound to take time. At the moment we are being held up because it was impossible in January of this year to add an arrangement on North sea herring to all the other arrangements that we made at that time, for the simple reason that the fishery had been closed for six years and there was no basis on which to make an arrangement for the future.
Mr. Stuart Randall: When the right hon. Gentleman was with his European counterparts did he discuss the possible extension of Isle of Man fishing limits? Does he accept that the Isle of Man Government have the power to make a unilateral decision to extend their fishing limits? Does he agree that nobody in the British Government will act, or has the power to act, to protect the interests of my constituents in West Hull?
Mr. Jopling: No, there was no discussion about the position of the Isle of Man. That matter has not come before the Council. We are, however, concerned about the reports we have seen and if they become more solid, no doubt we shall be debating the matter in the future. As for the hon. Gentleman's constituents in West Hull, I can only tell him that when we met the representatives of the fishing industry at the conclusion of the Council meeting, they had no criticism of the way in which we had conducted the negotiations.
Mr. Eldon Griffiths: I congratulate my right hon. Friend on having displayed in these difficult negotiations the same patience and firmness that he used to display as Chief Whip Will he convey to the Danes that they are in danger of losing the support in this House of some of their oldest and proudest friends? Is he aware that he will have full backing if he continues
1028
to give robust support to the British interest, while at the same time seeking an agreement within the Community, which in the long run is in the interests of us all?
Mr. Jopling: I agree with my hon. Friend's closing remark, because if we can get the common fisheries policy to work, which I have every confidence we can, that will be a huge bonus for us. I am grateful for his first remarks; he will agree that Chief Whips in general are extraordinary people. As for the Danes, if he or any other hon. Members can explain to them how important it is to reach agreement on this package of issues — which has already taken three meetings of the Fisheries Council and will take another one on 25–26 July — that would be very welcome indeed.
Sir Anthony Meyer: Does my right hon. Friend agree that it is somewhat nauseating that Labour Members, supposedly members of the party of the brotherhood of man, should gloat over the breakdown of every kind of international co-operation, and that those who have done everything they can to make it impossible for the European community to reach any decision should adduce that as a reason for not having Community policies?
Mr. Jopling: I agree with my hon. Friend. I have noticed over many years how Labour Members when in opposition gloat over all the gloom and doom that they can find.
Mr. Michael Brown: While congratulating my right hon. Friend on making representations on policing, may I urge him, as did my hon. Friend the Member for Bury St. Edmunds (Mr. Griffiths) to use his skill at threatening others, in particular to threaten those in the EC who are not prepared to ensure that the policy is implemented? I recognise the need to try to ensure that that policy, which his predecessor agreed in January this year, is implemented if at all possible. Will he not hesitate to threaten to use the veto on behalf of Britain, should that be necessary?
Mr. Jopling: I do not recall ever threatening anybody in my life, at any rate not for many years. If I ever thought it was necessary to threaten, I should hate to telegraph that fact; I would prefer to make the decision when it came to it. My hon. Friend is right when he speaks about implementation. As I explained, we made a big effort in the Council to press the Commission to have proper implementation of the policy through the inspectorate and by the use of log books. I now have a great deal more confidence that the policy will be properly implemented in future.
Mr. Speaker: I shall call the two hon. Gentlemen who wish to ask supplementaries, but it is not within my recollection that either was present for the statement.
Mr. D. N. Campbell-Savours: I was, Mr. Speaker.
Dr. Norman A. Godman: I apologise for my failure to be here when the Minister made the statement; I had very important business elsewhere.
I must be one of the few hon. Members who comes from a fishing family. In addition, I must be unique among hon. Members in having taken part in illegal fishing activities—
Mr. Dennis Skinner: Tell us more.
Dr. Godman: —off the Norwegian and Icelandic coast, albeit in an unwilling fashion. That was on a Hull trawler. In Aberdeen the behaviour is rather better than that.
The Minister emphasised the importance of the rule of law on this as on many other issues. In the last analysis, for a law to operate effectively it must have the consent and co-operation of those whose behaviour the law-makers seek to shape. As others have said, we must emphasise the importance of policing, and I speak as a fisherman who is now—
Mr. Speaker: Order. The hon. Gentleman must ask a question, not make a statement.
Dr. Godman: Does the Minister see the log book as a substitute for policing or as part of the total policing procedure?
Mr. Jopling: I regret that you called the hon. Gentleman to order at the point when you did, Mr. Speaker, because I thought that we were about to hear of various other exploits concerning illegal fishing, salmon poaching and so on.
I hope that the hon. Gentleman will see policing from several points of view. The key authority for policing is the state authority itself; each country polices its own waters. Effective policing will be made much easier if skippers are made to use the log books, which will begin to come into force by 1 November. In addition, we shall have the Commission's inspectorate overlooking national inspectorates to make sure that they are effective. I hope that the hon. Gentleman will be the last to be able to admit to taking part in illegal fishing because we shall largely have stamped it out.
Mr. Speaker: I apologise to the hon. Member for Workington (Mr. Campbell-Savours) if he was in his place for the statement. I thought that I saw him come in recently.
Mr. Campbell-Savours: Is the Secretary of State aware that there is great concern in west Cumbria among fishermen about the unilateral suggestion by the Isle of Man Tynwald that they have the right to extend their fishing limits? Are they able to do that without the approval either of our Secretary of State or this House?
Mr. Jopling: I appreciate that the hon. Gentleman's constituency looks over the Isle of Man. This is a matter on which there is not an absolutely clear legal agreement; the Isle of Man is neither a member of the Community nor part of the United Kingdom. It is an issue into which we are currently looking.
Mr. Norman Buchan: I revert to the question raised by, among others, the hon. Member for Orkney and Shetland (Mr. Wallace) about the klondikers. Surely the Minister is wrong in that while we have the right to supervise landings on to klondikers, we do not have the legal right to prevent them. I believe that there is in his
1030
Ministry at present a proposal to bring in legislation on that. We are seeking that legislation quickly because it is necessary. It could probably be enacted by way of statutory instrument, and if it were, we would give it our full support. May we have some prime ministerial resolution on that to get it done now?
How can the right hon. Gentleman defend this as being a superb agreement—he said that he was agreeing with his predecessor about that—because, he said, the CFP had settled in January the quotas, catches and so on, when in his statement today he said that the Council could not agree on the package of proposals for allowable catches, quotas and so on? In other words, a framework was created and it collapsed when the first attempt was made to fill it in and flesh it out. There is little satisfaction to be gained from such a policy. Will the right hon. Gentleman please drop his unctuous comments about the rule of law? Surely the crisis has been caused by the unauthorised fishing of about 70,000 tonnes to 100,000 tonnes by our Common Market partners, especially the Dutch and the Danes.
There will be a great deal of anxiety about the Minister's comment that an inspectorate of 39 was never envisaged. He explained that that number included, for example, secretaries and typists. He says, presumably, that on that ground an inspectorate of 13 is defensible. The statement referred to "some of the 13". How many of "some of the 13" will be secretaries? To what level has the inspectorate been reduced? How many inspectors will there really be? Will there be one, two, two and a half or three? Will the Minister accept that this is a lot of nonsense? Surely we need a full inspectorate if our waters and fishing stocks are to be protected, and that is what the Minister is supposed to be doing.
Mr. Jopling: As I have said, we shall not hesitate to use the powers available to us under the law to deal with illegal fishing wherever it happens and whoever engages in it.
As I also said in my statement, we have not been able to reach an agreement covering the whole package. As an agreement on North sea herring has been blocked by one state, it has not been possible to deal with all the other issues that are before the Council. If we can reach an agreement on North sea herring, which is much the most difficult issue, on 25–26 July, there will be cause for reasonable optimism that it will be possible to secure an agreement covering all the other issues to which I have referred, including quotas, total allowable catches, conservation measures and structural arrangements. I have every hope that we shall be able to do that.
Finally, the hon. Gentleman referred to the size of the inspectorate. The figure 13 refers to inspectors and not to secretaries.

Council of Fisheries Ministers

  BUSINESS OF THE HOUSE
  Ordered,
  That, notwithstanding the practice of the House as to the intervals between stages of Bills brought in upon Ways and Means Resolutions, more than one stage of the Finance Bill may be taken at this day's sitting.—[Mr. Sainsbury.]

Orders of the Day

  Finance Bill
  Considered in Committee [Progress, 12 July.]
  [MR. HAROLD WALKER in the Chair]

Clause 8

  REDUCTION OF TAX
  Question proposed, That the clause stand part of the Bill.
  4.33 pm
  Mr. Robin Cook: After the blow-out on Tuesday, when the higher rate bands were allowed to guzzle their way through £280 million, we are now picking over the crumbs that remain. The situation is slightly unusual, because normally the crumbs are left for household pets or, in their absence, the Door. The curious and distinctive feature of the Bill is that there is no room for the poor within it. The aspect that we find most offensive is that it contains not one provision that will relieve the tax burden of the poor or of the average earner. There are measures to reduce the tax burden on those who pay higher rates of tax. There are measures to reduce the tax burden of those who own small companies. There are measures to reduce the tax burden of those with the largest mortgages. There are even measures to reduce the tax burden of those who — presumably for reasons other than the weather—have chosen to take up domicile on the Channel Islands.
  Those we find picking over the crumbs in clause 8 are the wealthy. On Tuesday, we dealt with those who are rich in income and today we are faced with a provision to reduce the taxation of those who are rich in wealth. There is an overlap between the two categories. Indeed, they are the same people down to the last 1 per cent.
  Let us be clear in our minds whom we are talking about. The beneficiaries of this measure will be those who have a minimum estate of £60,000. They will be taxable only on the sum in excess of £60,000. For example, once the Bill is enacted, an estate valued at £80,000 will be liable to a CTT charge of only £6,000. We are aware from experience in our constituencies that an £80,000 estate is not normally achieved by the average income earner. Nor can such an estate be achieved by the curious statistical concept that we discussed on Tuesday and which was advanced by the occupant of the Treasury Bench—two males who are married, living together and each being in receipt of the average male wage. On the whole, estates of £80,000 can be achieved only by those who are comfortably off. I have in mind the sort of household that was able to use granny's inheritance to purchase shares in Cable and Wireless and which can now sell them off at 424p each.
  That sort of household has been liable to a tax charge over the past century. Until the Government came to power, there was a consensus that the inheritance of wealth was a proper subject for taxation. That consensus stretches back even beyond Lloyd George. It goes back some 300 years to the foundation of probate duty in 1694. I suspect
  1032
  that some Conservative Members would find themselves more comfortable and more at home if they were able to go back to those times.
  The consensus was founded on three propositions. First, it was recognised that households which managed to leave such large estates could afford to pay some tax. Secondly, it was recognised that at the point of transfer of the estate there was a mobile asset and, therefore, sufficient liquidity to enable the household to pay a tax charge. Thirdly, it was accepted that when viewed from the perspective of the recipient, the inheritance of a large sum was entirely arbitrary and due to no other virtue or act on his part than the good fortune of being born in the right household.
  That brings me to wider considerations of economic policy. The previous Chancellor of the Exchequer, who addressed himself to capital transfer tax in his last two Budget statements, was given to characterising CTT as a tax on enterprise or, as he said in March, as a tax "penalising personal endeavour". On the whole, the United Kingdom is not full of elderly wealthy couples who are scouring the country in search of individuals who show enterprise and endeavour and who will be suitable recipients of their fortunes.
  The reality is that there is a low correlation between enterprise and wealth. I am reluctant to disturb the prejudices of Conservative Members with the facts, but the unfortunate truth from their perspective is that research demonstrates repeatedly that the most common reason for people dying wealthy is that they were born wealthy. The most recent study took place in 1979 and was conducted by Harbury and Hitchins. It was discovered that two thirds of those leaving large estates had inherited large estates. It is worth noting that, of the remainder, one in 12 left a large estate on death because he or she had married well. I suppose that that might be described as enterprise of a kind.
  Mr. Tony Marlow: Does the hon. Gentleman discount altogether the fact that some people wish to acquire wealth and assets so that they can pass them on to their families, so that after their lifetime their families will benefit from what they did during their lifetime? Does he discount that altogether? Does he think that there is something wrong with that? Does he think that there is something wrong with the family? Does he think it wrong that a family should give people the initiative to be enterprising and therefore to create the wealth that will attract taxation and enable the welfare services to be run in this country?
  Mr. Cook: That was an interesting interruption. Conservative Members become hot under the collar when we discuss these matters in a rational manner, which is exceedingly revealing. I shall repeat what I was saying before the hon. Gentleman intervened, because it appears that he has not grasped my argument. Perhaps I should have anticipated that it would be necessary to repeat the argument twice before the hon. Gentleman would be able to grasp it. I was saying that two thirds of those who die and leave estates of the sort that we are discussing are able to leave such estates because they in turn inherited like estates at birth.
  Very few families are capable of scraping together, saving and putting aside through thrift and hard work £80,000 out of anything approaching a normal or average

  1033
  income. The vast majority—not just 90 per cent., but 95, 96 or 97 per cent.—of all households that manage to find some form of wealth to leave to their children, which is a perfectly proper activity and a laudable incentive, are in no way touched by the effect of capital transfer tax. What we are considering in the clause is to what extent we diminish the tax on those who leave large sums. We are talking about the wealthy section of the community and about those who are wealthy because primarily they were born wealthy or, as in the minority, because they married wealthy people.
  Given that the most common cause of being wealthy is being born wealthy, whatever the hon. Member for Northampton, North (Mr. Marlow) may say about the disincentive effect of taxation on the accumulation of wealth, there is precious little evidence that the taxation of wealth has as yet discouraged anyone from seeking to inherit it. The hon. Gentleman and his colleagues might want to ponder whether it is economically desirable that the primary source of wealth should be the accident of birth or the good fortune of marriage. The reason why I urge the hon. Gentleman and his colleagues to ponder upon that is that, although parents can arrange for their children to inherit their wealth, they cannot arrange for their sons to inherit the ability to put that wealth to good use for themselves and society.
  There is, therefore, no reason why we should regard CTT as an economic handicap. On the contrary, we could argue that there is a robust case that so far as CTT might succeed in breaking up the concentration of wealth, it is economically progressive. I shall quote Keynes. I hope that the Minister of State will forgive me if I refer to someone whom I know Conservative Members regard as a dissident author who should be reduced to samizdat copies only. Keynes said:
  "The hereditary principle in the transmission of wealth and the control of business is the reason why the leadership of the capitalist cause is weak and stupid."
  If that was true 30 years ago, how much more true it is as we look at the Conservative Benches. Keynes stated further:
  "It is too much dominated by third generation men."
  Therefore, we might argue that it would be economically progressive to encourage the dissemination rather than the concentration of wealth. Let me recap. We have established that there is a consensus that inheritance of wealth is a proper subject for tax. We have also established that in so far as we can trace an economic effect from that taxation, it is benign rather than malign.
  I shall refer to the recent history of the tax. There has been a steady decline in revenue from taxation on the inheritance of wealth over the past century. In 1914, estate duty produced 16 per cent. of all Government revenue —a substantial proportion. By 1945 that proportion had shrunk to 9 per cent. By 1975 that proportion had shrunk further to 4 per cent. In 1975, as the Committee will be aware, CTT was introduced. Since its introduction, the revenue from taxes on inheritance has barely increased in cash terms, and in real terms it has more than halved, whether one measures the real sum as an absolute figure or as a proportion of the revenue of the Treasury. I say to Conservative Members and the previous Chancellor of the Exchequer that those who believe that taxation on capital and inheritance is economically regressive might wish to
  1034
  ponder the fact that the period in which revenue on the taxation on inheritance was lightest was also the period of the most disastrous economic performance in Britain.
  4.45 pm
  What is impressive about the reduction in the burden of CTT is that there has been no parallel increase in the other capital taxes, which have gone through a similar reduction. The revenue from capital gains tax and investment income surcharge has declined under the present Government. It has been calculated—the figures are available in a Treasury answer—that during the four years of the Government's previous term of office revenue from CTT, CGT and investment income surcharge together declined by £600 million compared with the level that they inherited in 1979.
  It is striking that at the same time as we witnessed a reduction in revenue from the tax on capital, we witnessed a sharp increase in the tax on income. In the decade since the introduction of CTT, taxes on income have gone up fourfold in cash terms. It is exceedingly strange that given the choice between putting the burden on capital or on income, the Government, strikingly, have chosen to place the greatest burden of all on income. It is a choice that would have convinced Marx of the priorities of the capitalist establishment.
  Before the Minister proceeds to pounce on the fact that the Labour Government failed to increase revenue from CTT, let me openly admit that we are disappointed at the low revenue from CTT. There is no doubt that had we had the responsibility of office when it became clear that CTT would not produce the revenue that was expected or desired, we would have sought to remedy the situation by making sure that changes were made to increase the yield and return it to approximately the previous yield from estate duty. The charge that must be laid against Conservative Members is that having been in office when the information became available that the tax was failing to raise the expected revenue, far from taking action to remedy the problem, they set about wilfully dismantling the revenue that continued to come in from CTT.
  It is appropriate that we should debate the clause immediately after the return of the present Chief Secretary to the Treasury team. When he was in his previous incarnation as Minister of State, Treasury, he, more than anybody else, set about the demolition of CTT with a will. In 1980 he doubled the threshold for CTT and thus removed from the tax two thirds of those who were eligible for it before. Before departing from the Treasury in 1982, he again took up his demolition sledgehammer and struck out the cumulative principle from CTT. That was an interesting choice. In removing the cumulative principle, he effectively reduced CTT to a tax—[Interruption.] I am pleased that the Minister has now joined us. When he destroyed the cumulative principle in the 1982 Budget, he effectively converted CTT back to estate duty. As The Times observed after the 1982 Budget:
  "For many people the tax on their estates will be almost wholly avoidable if they start planning early enough."
  What is striking and significant about the avoidability of CTT now is that that was the clear and distinctive feature of estate duty and the reason why the Labour Government sought to reform estate duty by introducing CTT that applied the tax over all transfers during lifetime as well as at death.
  Conservative Members never liked that change. When CTT was introduced in 1975, Conservative Members in

  1035
  the Committee railed against the change in positively histrionic terms. Mr. Stephen Hastings, who regrettably is no longer with us, reminded the Committee in 1975 that a tax on capital provoked the fall of Rome and the invasion by the Vandals. There is no sign that CTT has been a similar threat to the British constitution and the fabric of life in Britain. The present Financial Secretary also took part in that debate. He said that he had never liked estate duty, which was being replaced by CTT, but that the advantage of estate duty was that one did not actually have to pay it.
  When we debated this provision in April I asked the Financial Secretary whether he was satisfied with the present form of CTT. To my great delight, he assured me that the Treasury had reduced CTT to a suitable form. I assume from that that he now regards it as being, like estate duty, in a form in which it can be avoided, but there is one key difference between estate duty and the Government's CTT regime. The thresholds that the Treasury operate for CTT are much higher than those which operated for estate duty, with which it is now almost identical. In other words, the burden of CTT is now less onerous than the estate duty to which it is so similar.
  The Committee must judge the clause against that background. If the clause goes throught intact, it will concede a £40 million to £50 million reduction in the CTT charge in a full year. Since the Goverment came to power in 1979 they have reduced the burden of CTT by £190 million. That sum must be set against this year's expected revenue of a mere £540 million. In other words, the various ways in which the Treasury has tinkered and struck at CTT and sought to chip away at its effectiveness have reduced its revenue by no less than one quarter.
  Cedric Sandford, the expert on this subject, writing in the Financial Times, which at that time was still being published, said:
  "In this Budget Sir Geoffrey Howe continues the process, as in all his previous Budgets, of drawing the teeth of CTT. He has been an effective dentist."
  The dentistry being practised by the Chancellor is to index the thresholds for CTT by more than the rate of inflation. In the Budget speech in March this year the then Chancellor said:
  "On capital transfer tax, I propose to increase the threshold and rate bands broadly in line with indexation." — [Official Report, 15 March 1983; Vol. 39, c. 152.]
  The Financial Secretary admitted in April that the indexation is 2 per cent. higher than the rate of inflation —that is, 2 per cent. higher than is strictly required by indexation. That is a generous margin. It happens to be identical with the percentage by which the same Government are fiddling the pension to ensure that pensioners do not get the full indexation. I am sure that many pensioner households would cheerfully settle for a pension broadly indexed in the same way as CTT if it meant that they would receive 2 per cent. more rather than 2 per cent. less.
  There is no possible justification for this generosity —this expensive sum of loose change flung on top of the general indexation for the wealthy. There is no justification in terms of fiscal prudence, economic progress or social justice. There is only one possible explanation.
  Mr. D. N. Campbell-Savours: Greed.
  Mr. Cook: My hon. Friend is characteristically more blunt than I. In a spirit of charity and seeking to understand
  1036
  the Government's motivation, I suggest that the explanation is the congenital affection of the Conservatives for the very wealthy. I remind my hon. Friends that affection is a positive human attribute and its rare flowering under the present Administration is welcome, however exclusive the corner in which we find it.
  When we gaze upon the evidence of the Government's affection as measured by the additional 2 per cent. to the very wealthy, however, we cannot forget—nor can we forgive—that the same Government have proved mean and vindictive to the unemployed, whose benefit has been cut by 2 per cent. this year and who are threatened with further cuts. Even as we have debated the Bill, the Government have again proved mean and vindictive in the cuts that they have imposed on the Health Service. It is against that background that we must measure the £40 million that the clause will give to the wealthiest members of our society.
  For that reason, the Opposition will take extra pleasure in voting against the repugnant double standards that the clause represents.
  Mr. Richard WainwrightIt is a commonplace that philistines can often get away with wrecking or dismantling a structure if the structure was originally so badly designed and constructed that few would rally to its defence. That is the fundamental mischief of capital transfer tax. Although its objects are wholly laudable it is badly constructed, as we made clear at the time, especially as it falls on the donor and not on the recipient. I hope that Treasury Ministers will not take advantage of that gift to them in dealing with this clause.
  The Red Book informs us that the change in the threshold will cost approximately £50 million to the Revenue in a full year. Therefore, there is an immediate problem of priorities. It is up to Treasury Ministers to try to convince the House that this is a proper priority. It is difficult to see how they can do so in two respects. First, what evidence can they produce that CTT now bites so hard or so unfairly that £50 million is well spent on restoring some equity? I do not believe for a moment that CTT in its present emasculated form bites unfairly on a substantial number of taxpayers, but I hope that we shall hear from Treasury Ministers if that is their view.
  Secondly, it is of the utmost importance that Ministers explain why they are continuing to give priority to the loss of £50 million to the Revenue in a full year when the Chancellor only last week openly confessed that the expenditure side of the March Budget had come seriously unstuck. That clearly creates a new situation in which Ministers must try to convince the Committee that this is still a justifiable priority. I think that they will be hard put to do so after the cuts that were announced last week which, as we all know, were only the first instalment. It is beyond my imagination how Treasury Ministers can justify going ahead with the proposal to provide the comfortably off with an additional £50 million relief.
  Those two tasks are firmly laid on Ministers. I hope that they will face them before we reach a decision on this.
  Mr. Marlow: I shall be brief. The hon. Member for Livingston (Mr. Cook) made a speech of Victorian proportions with Victorian vindictiveness about the well off and the people who have succeeded in society. As the Opposition make great play of the Prime Minister's

  1037
  referring to Victorian values, they would do better not to show Victorian spite in the way in which they approach these matters.
  The hon. Member for Livingston referred to the amount of money that is to be liable to capital transfer tax as if it were riches beyond the wildest imagination. The limit that we are discussing is rather less than the value of Arthur Scargill's house. The hon. Gentleman talked of giving away. The Opposition always make that mistake. Conservative Members realise that the money belongs to the people and that what is raised in revenue, the Government are taking from the people. The people are not giving that money. If the Government do not take the money they are not giving money away, they are just not forcing people to give it to the Government.
  The hon. Member for Livingston said that the money could be spent in other ways and on more worthy programmes. The Government proposed their programme in the Budget, saying what they would spend and what they would take. The Conservatives put that forward in the election campaign and made a commitment to the British people that that was how we would proceed. That is how we should proceed for one good reason. There are two alternatives in the circumstances in which the Government found themselves. They could either contain public expenditure within the limits that they committed themselves to or they could raise taxation.
  There is pressure in Government Departments, pressure from the work force in Government Departments and the pressure of programmes continually to spend more money. If the Government gave in and said, "Every time there is a problem in the public service we shall increase taxation," what would be the lesson? The lesson would be, "Spend, spend, spend, the Government will pay the bills." It is up to the public sector, public authorities and Departments to sort themselves out and live within the means that the Government and the people have given them. If those Departments and authorities were to get the message, "If you spend the money the Government will raise it," where would we go from there? Every time they spend more and the Government raise more, more burdens are put on our people and our industry. If we do that, the golden goose that raises the money that we need will be shot, killed, roasted and destroyed.
  5 pm
  As I said to the hon. Member for Livingston in an intervention, we need to provide the services for those who dearly require them, but if we put more burdens on our people there will be no money, wealth or welfare services. That is the direction in which the hon. Member for Livingston pointed the country in his speech. We must not go that way. We must stick within our budgetary limits and carry out the commitment and the promise that we made. On this side of the Committee, when we make promises we believe in keeping them.
  I seldom find myself agreeing with the Liberal party, but the hon. Member for Colne Valley (Mr. Wainwright) said that it would be far better if the tax were on the recipient rather than the giver. We should seriously consider moving from a capital transfer tax of this type to an inheritance tax. That would be far better from the point of view of distribution of wealth. It would be far better for those who think that it is wrong that a few people should
  1038
  receive great riches. It is far better that riches, which should be provided and which people should wish to create in their lifetime, were distributed among more people. That would be of far greater benefit to society. It would also be far more fair. I beseech the Government to consider moving in that direction.
  Mr. David Winnick: There should be much anger at what the Government are doing. This is by no means an obscure matter. We know that £50 million is involved, but it is the principle that should cause the greatest alarm.
  Once again, a Tory Government are taking steps, as soon as possible after a general election victory, to give benefits to the rich. There can hardly be any doubt that, shortly before the recess or immediately after our return, we shall hear of more public expenditure cuts that will affect our constituents, especially those who live on the smallest incomes. No doubt there will also be cuts in public services. We are now debating giving more relief to people who need it least. The increase is utterly unjustified. It is intended once again to reduce the burden of tax liability on the richest people. There is not much doubt that the Conservative party has never favoured any form of capital transfer tax. It is almost a matter of principle for Tories that a small number of people should gather a vast concentration of private wealth.
  One of the fictions that has grown up is that Britain has changed considerably with regard to private wealth. We are told that we are a more equal society, that we are nearly all middle class, that the class divisions of the turn of the century and before have been substantially eroded. That is far from the truth. The figures give a quite different picture. One quarter of all personal wealth is still owned by a mere 1 per cent. of the adult population. That is in the 1980s. Almost one third of all personal wealth is owned by 2 per cent. of the adult population and the top 10 per cent. own almost 60 per cent. of private wealth. The hon. Member for Northampton, North (Mr. Marlow) might be interested to know that that information does not come from a Left-wing publication. I am quoting the Inland Revenue's statistics for last year. That is one side of the picture, which destroys the myth that there is no longer a rich minority. Unfortunately there has been little move towards equality, even under Labour Governments. I regret that the previous Labour Government did not do more. At least Labour Governments have not helped the wealthy as the present Government are.
  The Low Pay Unit has just issued a report saying that more than 1 million children are in poverty or near-poverty because of their parents' low wages. It also says that 11–5 million people in nearly 7 million families earn no more than 40 per cent. above the level of supplementary benefit. Thus we have two Britains. The one is a small rich minority that carries on as before. It is being considerably helped by the Government. At the other end of the social scale are the millions who live in poverty or near-poverty. That is a disgrace.
  If we are to give priority to a group of people and there is money to be given away, surely justice demands that we give it to those who need it most—the poor, the near-poor and the children who live in such households. What possible justification can there be for giving priority to the rich minority? Ministers cannot possibly justify giving them more assistance from the public revenue. That is why I started by saying that there should be the utmost anger

  1039
  at what the Government are doing. The Prime Minister and her colleagues talk of what they call, "the Left" being concerned with class struggle and class war. It is the Government who are conducting class warfare.
  At Question Time today, the Prime Minister again refused to give any pledge about unemployment benefit being increased in line with prices after this year. All the signs are that the unemployed and those who receive short-term supplementary benefits will discover that they get no increase in line with prices next year and, possibly, thereafter. The children in such households will suffer. I wonder what sort of Government supporters can go through the Division Lobby tonight, or on any other occasion, to use their votes to give more to the rich minority and to deprive the millions who continue to live in poverty or near-poverty. That is why we shall constantly remind the Government of what they have done, especially when they refuse to update short-term supplementary and unemployment benefits next year. How many Conservative Members will benefit as a result of this clause? We shall use every occasion inside and outside Parliament to show how the Government are using their majority to aid their rich friends. That is our indictment, our accusation, against the Government.
  Dr. Jeremy Bray: The taxation of wealth is a problem about which hon. Members on both sides of the Committee become muddled. Conservative Members regard such taxation as an infringement of ancestral rights, and when it is questioned we hear from the Macmillans, Sainsburys, Aitkens and Ancrams of this country. Those hon. Members are loaded on to Select Committees discussing wealth tax, and the great barrage of claims for relief for the wealthiest families in the land is brought into play.
  Opposition Members show an extraordinary naivety in attacking the arguments of the Conservative party. The problems of the taxation of wealth, and the avoidance of that taxation, are complicated and tangled. None of our constituents write to us about those problems, and we have no reason to consider them for any constituency interest. We are hopelessly naive and ill-informed, until something happens, such as the Labour Government in 1974 setting up a Select Committee to consider a wealth tax. I hope that a future Labour Government will revive the principle of the taxation of wealth.
  I shall demonstrate the basis on which we propose a change in the structure of tax. The hon. Member for Colne Valley (Mr. Wainwright) made an interesting speech, but he is wrong to believe that the basis of change can be a tax on accessions. That tries to tax wealth only when it moves, which is the easiest method of taxation to avoid. The more elaborate the legislation to prevent avoidance, the greater the gains and the more complicated and difficult the system becomes. Change can be brought about only by taxing wealth where it rests. That was the principle of the wealth tax proposed in the 1970s, which went wrong because it was discussed only in terms of horizontal equity —equity between the holders of great wealth and those who enjoy high incomes. If it was unfair to tax people with high incomes when people with great wealth got away with paying little tax, there was a prima facie case for taxing the wealth. Conservative Members were prepared to consider a reconstruction of capital taxation on that basis. However, if one regards the purpose of taxing wealth not as horizontal equity but as vertical equity between those
  1040
  who have and those who have not, whether it be income or wealth, different sets of principles and approach are needed.
  It is not enough to consider what will happen to the rates of tax either on wealth or on the movement of wealth. We must consider what we wish to do with the assets that that wealth represents, such as stately homes, private companies or forests. If we set up a system for the taxation of wealth that has exemptions for farmland or forestry, the value of those assets will be hopelessly inflated because they will be tax avoidance measures. Those who wish to make an honest living from farming or foresty would be unable to do so because ownership of such things would become a tax avoidance racket. We must ask on what basis we wish the private or public ownership of assets to be taxed. The Opposition believe in principle, although they have not had the courage to put it into practice, that Britain's assets — whether they be production assets, land, stately homes or our national heritage—should be for public enjoyment and benefit. That does not mean that it would be sensible for a Labour Government to eliminate the private ownership of wealth, but we should be realistic about the levels of wealth that it is reasonable to expect people to hold. It is reasonable not to knock the small garage owner or the owner of the sweetie shop. However, if we allow the man who has built up a business worth £50 million to believe that he has a God-given right to keep that money and not to share it with those who helped him to build up the business, that is plainly wrong.
  5.15 pm
  After considering the use of the assets and the extent of the redistribution that we seek, we must ensure that we leave adequate provision to encourage the savings needed to finance the investment required in society and productive industry. That is not a problem, because in recent years the savings ratio has been high and is increasing. The vehicle by which it has increased has been the growth of pension schemes and investment trusts, so we now have a high level of personal savings that is adequate to fund the necessary investment.
  I hope that my hon. Friends will be courageous in tackling the taxation of wealth, be prepared to have a go fundamentally and not to listen to the hogwash that we hear from the Conservative party about the economic arguments, and get on with the social and practical economic adjustments that must be made.
  Mr. Campbell-Savours: My speech will be unashamedly emotional because I am angry about what the Government are doing in this clause. I had no intention of speaking in the debate until I heard the Prime Minister at Question Time today. In a disgraceful spectacle, which every British voter should have seen, she showed that she had no sensitivity about unemployment and that she does not understand that some British people are doing without. Her Government are spending this £50 million, which the people need to secure decent living standards.
  Today the Prime Minister said that no Government had been able to define levels of poverty, but I must tell her and the members of her Cabinet that if they want to see poverty they should come to our constituencies, to our housing estates, where people live in deplorable and miserable conditions. It is about time that they left Whitehall and the House of Commons — many Conservative Back-Benchers could go with them —and went into the real outside world.

  1041
  During the past week, £450 million has been given back to the 3 per cent. in society who are most wealthy. That is a disgrace. This is the last but one measure in the Bill that once again legislates for that transfer back to the people who have in this society, to be paid for by the people who have not. The Government disgrace the Dispatch Box, Parliament and all the British people by bringing forward such legislation when they know that they have no mandate from the British people to give back that money in the way that they have.
  Mr. James Hamilton: Is my hon. Friend aware that just before the election a report on the population was prepared by the social working party in Strathclyde? It showed that one in five of the population of Strathclyde, which is the largest region in Scotland, and probably the largest region in the United Kingdom, lives in abject poverty, and that that figure was an increase of 35 per cent. since the Tories came into office in 1979. The Glasgow people feel as resentful about this as does my hon. Friend. I can understand his anger and frustration because there does not seem to be any hope of the Government doing anything to ease the poverty that prevails in many parts of the world.
  Mr. Campbell-Savours: In every constituency of my right hon. and hon. Friends, and in yours Mr. Walker, there is great poverty, yet the Government believe that they have a mandate to hand back £400 million to the 3 per cent. income and wealth holders in our society.
  Last week I raised a point of order asking that the Government, in the form of the Chancellor of the Exchequer, be given the right to come to the Dispatch Box to withdraw this Bill, which favours those who have and takes away from those who have not. For seven days I have waited for them to come forward. Even today, when the Prime Minister was at the Dispatch Box, there were calls from my hon. Friends for the withdrawal of the Bill. The Minister and his friends know that it is immoral and offends the dignity and peace of mind of respectable citizens. Tonight, once again, I ask the Government to withdraw the Bill. Our people who have nothing cannot afford to pay for it. There is an obligation on decent Government to make sure that they are not required to pay it.
  The Minister of State, Treasury (Mr. Barney Hayhoe): The hon. Member for Livingston (Mr. Cook) implied that he and his hon. Friends would be voting against the clause, but ranged somewhat wide of the detailed content of the clause itself. I make no complaint. He did so on the evening of 25 April when he made a similar speech on clause 63 of the previous Bill. He would be the first to acknowledge that much of what he said today, particularly in some of his more telling phrases, was what he said in his speech in April.
  The clause is relatively modest and has attracted more than its fair share of the invective of envy and the old phrases of the class war from some Labour Members. It has also led to thoughtful comments by the hon. Member for Motherwell, South (Dr. Bray), at least in the earlier part of his speech, and to the hon. Member for Colne Valley (Mr. Wainwright) challenging the basis of the capital transfer tax and saying again what he has said on previous occasions—that his preference lies towards an
  1042
  inheritance tax. He was joined by my hon. Friend the Member for Northampton, North (Mr. Marlow), who commended that approach.
  Perhaps it would be best if I were briefly to remind the Committee of the background of the clause. Last year's Finance Bill recast the capital transfer tax scales both for lifetime transfers and those on death. It provided that, unless Parliament otherwise determined, those scales should for the future be automatically increased in line with changes in the retail price index over the year ending the previous December. In other words, the Finance Act 1982 legislated for an automatic increase of the level and scales of this tax.
  The Finance Bill 1983, introduced earlier this year, proposed in clause 53 rate bands similar to those for 1982 after indexation by reference to the change of the price levels over the year ended last December. The amounts for most bands were somewhat more than the rounding to the nearest £1,000 stipulated by section 91 of the Finance Act 1982. The extra rounding was mainly intended to provide a more sensible gradation.
  The Opposition saw fit to oppose the modest extra rounding that was proposed and clause 63 was therefore dropped from the pre-election Finance Act. In introducing those provisions into this Finance Bill, we are carrying through, as has been acknowledged, our statements, before and during the election, that we would re-enact those portions of the earlier Finance Bill dropped because of the election and because of the insistence of the Opposition that they be dropped in order that the Act should go through.
  Clause 8 reintroduces those provisions. It will take effect from the same day as clause 63 in the Act earlier this year, 15 March 1983. If the clause were not enacted, the indexation would take effect from 1 April. Thus, there is a fortnight's difference. When I come to refer to the cost, that will be taken into account in the overall assessments and estimates that I can give of the cost involved in this clause.
  The capital taxes office has not finally settled tax liability on transfers made on or after 15 March and therefore there is no administrative difficulty. As to the effect of the changes, it is recognised throughout the Committee that the change from the old scales—those produced by indexation—to the new scales, set out in an appendix that has also been made available to Members, will leave no estate worse off.
  The effect of the clause is broadly to maintain the burden of capital transfer tax at the same level in real terms as last year. I acknowledge that the rounding out in the increase in thresholds is a little more—
  Mr. Campbell-Savours: Why not raise the unemployment benefit in the same way?
  Mr. Hayhoe: I am dealing with the clauses before the Committee. Except for estates up to about £80,000, the burden of the capital transfer tax rates scale remains heavier, despite this measure, than—
  Mr. Winnick rose—
  Mr. Hayhoe: I understand why the hon. Gentleman wishes to intervene, but let me finish the point I am making. Except for estates up to about £80,000, the burden of capital transfer rates scale remains heavier after the enactment of this clause than when the tax was introduced by the Labour

  1043
  Government. The hon. Members for Livingston and for Walsall, North (Mr. Winnick) acknowledged that by their embarrassment in recognising that, when the party that they supported was in power, it was not pursuing the policies that those hon. Members would have wished. It is important to remember that.
  Much of the passion and criticism of this clause has concentrated on the costs that are involved, and has been based on a gross overestimate of those costs. I believe that there has been a misunderstanding of the true position, because I do not for a moment think that the figures were quoted in the knowledge that they were wrong. The cost of the proposals in the clause this year amount not to £50 million, but to £5 million. Indexation is the result of the Finance Act 1982, but the cost of this measure will increase those costs over and above indexation by £5 million this year, £10 million next year, and £15 million for a full year.
  5.30 pm
  Mr. Jack Straw: Surely the Minister does not deny that when we debated the matter before the general election the then Financial Secretary gave figures for the total cost of these changes, including indexation, of £40 million this year, £50 million next year, and £60 million in subsequent years.
  Mr. Hayhoe: The hon. Gentleman's intervention leads me to believe that perhaps some Opposition Members knew the truth about the cost and thus might—I hope inadvertently — have misled the Committee. We are debating clause 8. We are not debating the provision that was enacted in last year's Finance Act. The choice before the Committee in this debate is to accept the scales laid down in clause 8 or—
  Mr. Campbell-Savours: It is a play on words.
  Mr. Hayhoe: It is not a play on words. If the clause is defeated, the effect would not be a saving of £50 million of tax revenue; it would be a saving of £5 million.
  Mr. Campbell-Savours: Then give us a de-indexation clause.
  Mr. Cook: The Minister of State was unable to be here on Tuesday, but had he been here at the start of our proceedings he would have heard me raise a point of order of some substance and length, in which I referred to the Opposition's frustration in tabling amendments to the Finance Bill. I am pleased to see that the Economic Secretary recollects that. If it will assist the Minister of State, let me tell him that we would willingly and cheerfully have tabled an amendment to suspend indexation for this year. However, any such amendment would he nugatory, because it would have been ruled incompetent on the basis that it would have raised an additional tax charge.
  We object to the £50 million for this year, for which the Government must take responsibility. In this clause, the Government relieve themselves of indexation provisions in subsection (1) so that they may go beyond them in subsection (2). Elemental forces have not driven them to give away those millions in indexation. They could have chosen to stop at subsection (1), in which case the £50 million would not have been given away.
  Mr. Hayhoe: One could be hypothetical and talk about "might have beens". However, we are in Committee,
  1044
  taking decisions on a Bill. Our choice is either to accept this clause, which I hope the Committee will do, or to reject it. If the clause is rejected, the cost will be £5 million, not £50 million. However Opposition Members seek to camouflage the true position, it remains as I have stated.
  I want to make a further comment, because of what my hon. Friend the Member for Northampton, North said about the deep divide that is apparent in the Committee. The Opposition talk about the Government giving away, when in fact we are taking less. We are talking about the amount of tax that will be charged. The division between us—and I acknowledge that it is a deep and important division — arises because the Opposition want to tax more, and, indeed, not just on capital taxes. The record of Labour Governments is to increase taxation whereas, broadly speaking, Conservative Governments decrease taxation.
  Mr. Winnick rose—
  Mr. Hayhoe: Of course, we can argue about some of the details, but it is clear that Labour Members believe that Governments give away when they reduce taxation, whereas Conservative Members believe that we take less. That demonstrates the great divide between us. Nevertheless, I hope that the Committee will approve the clause.
  Mr. Robin Cook: I want to say a few words to the hon. Member for Northampton, North (Mr. Marlow), who is not in the Chamber at present. I shall give him some time to return here, because I am quite sure that having intervened in the debate, he does not want to miss the wind-up speeches. I therefore await his return.
  Meanwhile, I shall comment on what the Minister has just said. I do not know which Conservative Government he has in mind, but it is certainly not true that the last Conservative Government reduced the burden of taxation. Time after time in the House we have debated the fact that. without any shadow of doubt, the last Conservative Government increased the burden of taxation on income. Tonight we are debating the fact that, side by side with that increased burden on income, there was a reduction in the tax charge on capital, and the combination of a reduction in the tax on capital and an increase in tax on income has to be the result of the clear, deliberate priorities of this Government.
  I say to the Minister, with a heavy heart, that it is not true that Labour Governments always increase taxation, particularly capital taxation. I remind the Minister of the figures that were given by the Financial Secretary at the close of our debate at midnight on 25 April. He said that in 1970–71 the revenue from estate duty was £1,645 million, that in 1975 it was £1,026 million, and that by 1979 the revenue from CTT had fallen to £638 million. This year it will be £540 million. I do not make a partisan point — [Interruption.] I regret that Conservative Members are incapable of seeing the case for looking at the trend, and are blinded by the partisan points that they constantly wish to score.
  Over that 15-year period there has been a steady reduction in revenue from tax on capital. During that time the revenue has fallen from £1,600 million in 1970 to £540 million this year, in cash terms. In other words, the burden of tax on capital has fallen within 15 years to one third of its former level. That is the extent to which capital and

  1045
  wealth are now failing to meet their full responsibility to contribute to the legitimate necessities of the state to maintain public expenditure. It has happened at the very same time—again I do not make a partisan point—when the tax on income has increased throughout that period, under all three Administrations that were in power.
  To be candid, I find it offensive, as does my hon. Friend the Member for Workington (Mr. Campbell-Savours) and, I suspect, although I did not detect it in the academic dissertation that he made to the Committee, my hon. Friend the Member for Motherwell, South (Dr. Bray), that at the very time that tax on income is rising, tax on capital should be falling.
  Mr. Winnick: The Minister accused Labour Members of always wanting to increase taxes. Is it not appropriate to remind the Minister that it was his Government who subjected the unemployed to double taxation, which will continue until November? That is the result of unemployment benefit being taxed since last year and the fact that the 5 per cent. abatement has not been restored and will not be restored until the end of the year. Surely Conservative Members are the last people to give us lectures about taxation.
  Mr. Cook: I recall the Minister vigorously refusing in our debates in 1982 to repay the 5 per cent. abatement. As we said time and again then, if a category of society other than the unemployed were made subject to the double jeopardy of double taxation, Conservative Members would rise in revolt and call upon their Government to remedy the iniquity of it. My hon. Friend anticipates me because the parallel to the treatment of the wealthy that we see in this clause is the treatment of the poor.
  Mr. Campbell-Savours: My hon. Friend commented on the reducing tax taken under successive Governments, including Labour Governments. Surely he will ensure that the record is correct. Under the change from death duties to capital transfer tax, the new rules concerning spouses were the greatest contributor to tax reduction and it was not our intention to reduce the liability that fell on the better-off in society.
  Mr. Cook: I agree entirely. The previous Labour Government had no intention to reduce the yield from taxation on capital. Conservative Members must take responsibility for pressing for the many concessions from a Government who had no majority with which to resist them, and which resulted in a decline in the yield.
  Mr. Alan Howarth: The hon. Gentleman expresses concern for the unemployed but does he not recognise that if we destroy capital we destroy the seed corn from which the jobs of the future will grow?
  Mr. Cook: There might have been some force in that point were it not that the decline in the revenue from tax on capital also coincides with a historic period in which there has been a positive stampede from investment in industry by the personal sector and the fact that the hole in investment created by that is being filled by the institutions, which has nothing to do with the tax that we are discussing in the clause.
  The hon. Member for Northampton, North has not returned to the Chamber, which I regret since he chose to make an intervention. In his absence I regret that I shall
  1046
  have to say some unkind things about him. I must warn him that he should stop saying nasty things about Victorian values if he wants to graduate from the Back Bench to the Treasury Bench. His observations today that it is the Opposition that effulge Victorian values will not go down well with the Prime Minister.
  It is not credible to argue that if we maintain indexation rather than give indexation plus 2 per cent. to those who hold estates of £60,000 or more we shall destroy the incentive to work. If the hon. Gentleman is seriously concerned about the incentive to work, the people he should be expressing concern and anxiety about are those struggling on lower than average earnings who find that they are subject to a marginal tax on every pound earned of 39 per cent. to 30 per cent. standard and 9 per cent. national insurance contributions. If they have a means-tested benefit they then have a marginal tax rate in excess of that 39 per cent. Those are the people who are having to pay for the concessions that we are giving to the very rich in this clause and those are the people who are subject to a disincentive to work.
  5.45 pm
  The hon. Member for Northampton, North has at long last returned to the Committee. If he were concerned about disincentives, those are the people about whom he should be addressing the Committee with passion. Since it was not those, one is driven to the conclusion that all the persiflage about incentives are nothing other than a cover for the class prejudice of Conservative Members and the people to whom they wish to give tax relief.
  The Minister, in trying to exculpate himself from the £50 million, used weasel words in his reply. As a Minister who belongs to the Treasury, he must accept his responsibility for the clause that he has put before the Committee. That clause has the effect of conceding £50 million to the very rich. If it were the view that the Treasury could not afford that £50 million it was open to it to do the very thing that it did to income tax payers in 1981, and that is to suspend indexation for this year. If it could do that for the generality of income tax payers in 1981 in a way that put a particularly grievous burden on the low income tax payer, it could have done it for the very rich this year.
  Therefore, our conclusion must be that it is the Treasury's judgment that it can afford and find the £50 million to finance the concessions in clause 8. The Committee must ask how it is that it can find £50 million to finance those concessions. How is it that it can find £50 million—to use the Minister's own words—to take less from the very rich when it has admitted within the past week that it cannot afford to maintain the present level of unemployment benefit or to maintain the present expenditure of the National Health Service?
  Those are priorities that I find provide a revealing insight into the prejudices and values of Conservative Members. They are values that I completely reject and that every Labour Member will wish to reject. For that reason we shall vote against the clause.
  Question put, That the clause stand part of the Bill:—
  The Committee divided: Ayes 211; Noes 108.

  Division No. 22]

  [5.47 pm

  AYES

  Adley, Robert

  Arnold, Tom

  Alexander, Richard

  Ashby, David

  1047

  Aspinwall, Jack

  Harris, David

  Atkins, Rt Hon H. (S'thorne)

  Hayhoe, Barney

  Atkins Robert (South Ribble)

  Hayward, Robert

  Atkinson, David (B'm'th E)

  Heathcoat-Amory, David

  Baker, Nicholas (N Dorset)

  Heddle, John

  Baldry, Anthony

  Hickmet, Richard

  Banks, Robert (Harrogate)

  Hind, Kenneth

  Batiste, Spencer

  Hirst, Michael

  Bellingham, Henry

  Hogg, Hon Douglas (Gr'th'm)

  Bennett, Sir Frederic (T'bay)

  Holland, Sir Philip (Gedling)

  Bevan, David Gilroy

  Holt, Richard

  Biggs-Davison, Sir John

  Howard, Michael

  Blackburn, John

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

  Blaker, Rt Hon Peter

  Howarth, Gerald (Cannock)

  Body, Richard

  Howell, Rt Hon D. (G'ldford)

  Boscawen, Hon Robert

  Hunt, John (Ravensbourne)

  Bottomley, Peter

  Jackson, Robert

  Braine, Sir Bernard

  Jessel, Toby

  Brandon-Bravo, Martin

  Jones, Gwilym (Cardiff N)

  Bright, Graham

  Jones, Robert (W Herts)

  Brinton, Tim

  Jopling, Rt Hon Michael

  Brown, M. (Brigg & Cl'thpes)

  Key, Robert

  Bruinvels, Peter

  Knight, Gregory (Derby N)

  Budgen, Nick

  Knowles, Michael

  Burt, Alistair

  Latham, Michael

  Butterfill, John

  Lawler, Geoffrey

  Carlisle, John (N Luton)

  Lawrence, Ivan

  Carlisle, Kenneth (Lincoln)

  Leigh, Edward (Gainsbor'gh)

  Carttiss, Michael

  Lennox-Boyd, Hon Mark

  Chope, Christopher

  Lester, Jim

  Clark, Dr Michael (Rochford)

  Lewis, Sir Kenneth (Stamf'd)

  Clarke Kenneth (Rushcliffe)

  Lightbown, David

  Colvin, Michael

  Lilley, Peter

  Conway, Derek

  Lloyd, Ian (Havant)

  Coombs, Simon

  Lord, Michael

  Cope, John

  Luce, Richard

  Couchman, James

  Lyell, Nicholas

  Cranborne, Viscount

  McCrindle, Robert

  Critchley, Julian

  McCurley, Mrs Anna

  Currie, Mrs Edwina

  Macfarlane, Neil

  Dorrell, Stephen

  MacGregor, John

  Douglas-Hamilton, Lord J.

  MacKay, Andrew (Berkshire)

  Dover, Denshore

  Macmillan, Rt Hon M.

  Dunn, Robert

  Major, John

  Dykes, Hugh

  Malins, Humfrey

  Eggar, Tim

  Malone, Gerald

  Emery, Sir Peter

  Maples, John

  Evennett, David

  Marlow, Antony

  Fallon, Michael

  Marshall, Michael (Arundel)

  Favell, Anthony

  Mates, Michael

  Fenner, Mrs Peggy

  Mather, Carol

  Finsberg, Geoffrey

  Maude, Francis

  Fookes, Miss Janet

  Maxwell-Hyslop, Robin

  Forman, Nigel

  Mellor, David

  Forsyth, Michael (Stirling)

  Meyer, Sir Anthony

  Forth, Eric

  Miller, Hal (B'grove)

  Fowler, Rt Hon Norman

  Mills, Sir Peter (West Devon)

  Franks, Cecil

  Moate, Roger

  Fraser, Peter (Angus East)

  Moore, John

  Freeman, Roger

  Morris, M. (N'hampton, S)

  Fry, Peter

  Moynihan, Hon C.

  Gale, Roger

  Murphy, Christopher

  Galley, Roy

  Needham, Richard

  Gardiner, George (Reigate)

  Nelson, Anthony

  Gardner, Sir Edward (Fylde)

  Neubert, Michael

  Garel-Jones, Tristan

  Newton, Tony

  Glyn, Dr Alan

  Nicholls, Patrick

  Goodlad, Alastair

  Normanton, Tom

  Gorst, John

  Norris, Steven

  Gow, Ian

  Ottaway, Richard

  Greenway, Harry

  Page, John (Harrow W)

  Gregory, Conal

  Page, Richard (Herts SW)

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

  Parris, Matthew

  Griffiths, Peter (Portsm'th N)

  Patten, John (Oxford)

  Ground, Patrick

  Pawsey, James

  Grylls, Michael

  Peacock, Mrs Elizabeth

  Hamilton, Hon A. (Epsom)

  Pink, R. Bonner

  Hamilton, Neil (Tatton)

  Prentice, Rt Hon Reg

  Hanley, Jeremy

  Price, Sir David

  Hargreaves, Kenneth

  Proctor, K. Harvey

  1048

  Raffan, Keith

  Terlezki, Stefan

  Rhodes James, Robert

  Thompson, Donald (Calder V)

  Rhys Williams, Sir Brandon

  Thorne, Neil (Ilford S)

  Ridsdale, Sir Julian

  Thurnham, Peter

  Robinson, Mark (N'port W)

  Tracey, Richard

  Roe, Mrs Marion

  Trippier, David

  Rossi, Hugh

  Viggers, Peter

  Rost, Peter

  Walden, George

  Rumbold, Mrs Angela

  Waller, Gary

  Ryder, Richard

  Wardle, C. (Bexhill)

  Sainsbury, Hon Timothy

  Warren, Kenneth

  Sayeed, Jonathan

  Watts, John

  Shaw, Sir Michael (Scarb')

  Wells, Bowen (Hertford)

  Shelton, William (Streatham)

  Wheeler, John

  Shepherd, Colin (Hereford)

  Wilkinson, John

  Sims, Roger

  Winterton, Mrs Ann

  Soames, Hon Nicholas

  Winterton, Nicholas

  Speed, Keith

  Wood, Timothy

  Speller, Tony

  Yeo, Tim

  Spicer, Jim (W Dorset)

  Young, Sir George (Acton)

  Stanbrook, Ivor

  Younger, Rt Hon George

  Stern, Michael

  Stevens, Lewis (Nuneaton)

  Tellers for the Ayes:

  Stradling Thomas, J.

  Mr. Ian Lang and

  Tapsell, Peter

  Mr. David Hunt.

  Temple-Morris, Peter

  NOES

  Adams, Allen (Paisley N)

  Kaufman, Rt Hon Gerald

  Atkinson, N. (Tottenham)

  Leighton, Ronald

  Barron, Kevin

  Lewis, Terence (Worsley)

  Beckett, Mrs Margaret

  Lofthouse, Geoffrey

  Bell, Stuart

  Loyden, Edward

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

  McDonald, Dr Oonagh

  Bermingham, Gerald

  McKay, Allen (Penistone)

  Bidwell, Sydney

  McKelvey, William

  Boothroyd, Miss Betty

  McNamara, Kevin

  Boyes, Roland

  Madden, Max

  Bray, Dr Jeremy

  Marek, Dr John

  Brown, Gordon (D'f'mline E)

  Mason, Rt Hon Roy

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

  Meacher, Michael

  Caborn, Richard

  Meadowcroft, Michael

  Callaghan, Rt Hon J.

  Michie, William

  Callaghan, Jim (Heyw'd & M)

  Millan, Rt Hon Bruce

  Campbell-Savours, Dale

  Miller, Dr M. S. (E Kilbride)

  Cohen, Harry

  Molyneaux, James

  Cook, Frank (Stockton North)

  Morris, Rt Hon A. (W'shawe)

  Cook, Robin F. (Livingston)

  Nellist, David

  Cowans, Harry

  O'Brien, William

  Cox, Thomas (Tooting)

  Orme, Rt Hon Stanley

  Crowther, Stan

  Parry Robert

  Cunliffe, Lawrence

  Patchett, Terry

  Davies, Rt Hon Denzil (L'ili)

  Pavitt, Laurie

  Davies, Ronald (Caerphilly)

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

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

  Powell, Raymond (Ogmore)

  Deakins, Eric

  Prescott, John

  Dixon, Donald

  Radice, Giles

  Dormand, Jack

  Richardson, Ms Jo

  Dubs, Alfred

  Robertson, George

  Dunwoody, Hon Mrs G.

  Rogers, Allan

  Eastham, Ken

  Ross, Ernest (Dundee W)

  Evans, Ioan (Cynon Valley)

  Sheerman, Barry

  Fatchett, Derek

  Sheldon, Rt Hon R.

  Field, Frank (Birkenhead)

  Shore, Rt Hon Peter

  Fisher, Mark

  Short, Ms Clare (Ladywood)

  Foot, Rt Hon Michael

  Silkin, Rt Hon J.

  Foster, Derek

  Skinner, Dennis

  Freud, Clement

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

  Garrett, W. E.

  Snape, Peter

  Godman, Dr Norman

  Soley, Clive

  Gould, Bryan

  Spearing, Nigel

  Hamilton, James (M'well N)

  Stewart, Rt Hon D. (W Isles)

  Hardy, Peter

  Straw, Jack

  Harrison, Rt Hon Walter

  Thompson, J. (Wansbeck)

  Hattersley, Rt Hon Roy

  Tinn, James

  Haynes, Frank

  Wainwright, R.

  Heffer, Eric S.

  Wallace, James

  Hoyle, Douglas

  Wardell, Gareth (Gower)

  Hughes, Sean (Knowsley S)

  Wareing, Robert

  Hughes, Simon (Southwark)

  Welsh, Michael

  1049

  Williams, Rt Hon A.

  Winnick, David

  Tellers for the Noes:

  Woodall, Alec

  Mr. Austin Mitchell and

  Young, David (Bolton SE)

  Mr. Hugh McCartney.

  Question accordingly agreed to.
  Clause 8 ordered to stand part of the Bill.

Clause 9

  GIFTS TO CHARITIES
  Question proposed, That the clause stand part of the Bill.
  Mr. Straw: When capital transfer tax was originally introduced in the Finance Act 1975, gifts to charities of up to £100,000 were exempted from a charge to tax. In 1980 that was increased to £200,000, and to £250,000 in last year's Finance Act. Under clause 9 that facility for charities is greatly extended, because the limit is lifted altogether. We shall not divide the House on this issue, but there are two points that I wish briefly to raise.
  First, what loss of revenue is anticipated as a result of this change? Secondly, is the Treasury satisfied that with the lifting of the limit sufficient powers exist to cover what I would describe as "bogus charities"? I refer to trusts that have charitable status but which exist simply as fronts for tax avoidance schemes. The Minister will be aware that there was a theatrical company and trust that was not unknown to the Revenue for offering a facility for such schemes. Is the Treasury satisfied that with the lifting of the exemption, thus making greater the attractiveness of bogus charitable trusts, there are sufficient powers to ensure that they do not take advantage of the new provision?
  6 pm
  Mr. Timothy Yeo: I welcome the lifting of capital transfer tax on charities to bring them into line with the National Trust, but the change will be of primary benefit to the larger charities. Out of 140,000 charities, only 70 last year had an income from legacies in excess of £250,000. The concession will, therefore, be of interest only to the larger charities. Many medium-sized charities have no concession. That underlines the need for VAT relief for all charities. In the past the Treasury has argued against granting VAT relief on the ground that it would benefit only the larger charities. That is inconsistent with the decision to offer relief from CTT.
  I share the concern that some less desirable charities — not necessarily in the tax avoidance category, but whose objectives could be considered to be not entirely charitable—may be most likely to benefit from CTT relief. We should examine carefully the overall package of fiscal concessions for charities. The change is welcome, but it underlines the need for a further examination of the VAT issue.
  Mr. Hayhoe: I am glad that the Opposition welcome the clause.
  My hon. Friend the Member for Suffolk, South (Mr. Yeo) has a long-standing interest in charities which is recognised throughout the House. I am not surprised that he put in a dig about VAT and charities in a discussion on a clause which has nothing to do with VAT. My hon. Friend is learning fast about how things are done. The
  1050
  reason that the Treasury is not able to help charities through the VAT route is wider than the one to which he referred. I am glad that he welcomes the clause.
  The cost of the clause this year is negligible. It will involve about £1 million in a full year. Comments have been made about the freedom from CTT being used as a tax avoidance route. That is more because of publicity than knowledge. Lifetime gifts are already exempt. All that the clause does is to extend that relief to gifts linked to the death of the donor. I do not believe that the extra risk—if there is an extra risk — of its being used for tax avoidance will cause difficulty. I am sure that it is a risk that we should take.
  If hon. Members have any information about the way in which the provision could be, or is being, used as a tax avoidance route, I hope that they will make it available. I am sure that the Inland Revenue will take action against any misuse of the provisions.
  Question put and agreed to.
  Clause 9 ordered to stand part of the Bill.

Clause 10

  RELIEF FOR BUSINESS AND AGRICULTURAL PROPERTY
  Mr. Straw: I beg to move amendment No. 10, in page 8, line 33, leave out subsection (1).
  The Chairman: With this it will be convenient to discuss amendment No. 11, in page 9, line 1, leave out subsection (2).
  Mr. Straw: These are probing amendments. The Government have never explained in detail why the relief should be increased from 20 per cent. to 30 per cent. They have never given the cost of the change.
  Mr. Spencer Batiste: I am grateful to you, Mr. Dean, for calling me to make my maiden speech. If I rise with trepidation, it is in part because of the natural awe of the amateur historian participating for the first time in the proceedings of the Mother of Parliaments and partly because of the nervousness of a new boy who is conscious of the high standard set by those who have gone before him.
  As befits a lawyer, before embarking upon my maiden speech I inquired of senior colleagues about advice on timing. And as is usual when a lawyer takes advice, the advice was divided and contradictory. Some said that I should seize the first possible opportunity of catching Mr. Speaker's eye and relieve myself of the inhibitions of maidenhood. Others said that I should first sit and watch, learn and understand the ways of the House. The compromise that I have adopted was suggested to me. I was advised to wait until I had first been allocated a desk and a telephone so that no one could accuse me of acting precipitately and I would have first-hand experience of the ways of the House.
  Due to the ministrations of the Boundary Commission, for me this is a double maiden. Not only is this my first speech in the House, but it is the first occasion on which any hon. Member has spoken in the House on behalf of the Elmet constituency. As a name, Elmet has the advantages of brevity and mystery. The name has not been widely used since 617 AD. Indeed, a significant part of my election campaign entailed explaining to people who had for many years voted in Barkston Ash, Leeds, East and

  1051
  Normanton that they lived in a new constituency. It is an example of what the hon. Member for Livingston (Mr. Cook) referred to as "moving the countryside around."
  One can imagine, therefore, how impressed I was with the erudition and store of learning in the House when on my first day here I explained to an hon. Member whom I had met for the first time that I was the Member for Elmet and he said, without prompting, "That's the old post-Roman British kingdom between the Wharf and the Aire which is now in west Yorkshire and which was conquered by Northumbria in the seventh century." There is little that I can add to that, save that the tradition of tough-mindedness, independence, self-resolution and self-help are still very evident in the people of Elmet and that they typify the right hon. and hon. Members who represented for many years its three component parts.
  I pay tribute to my right hon. Friend the Member for Selby (Mr. Alison) and the right hon. Member for Leeds, East (Mr. Healey) who represent neighbouring constituencies to the east and west, and to Mr. Albert Roberts who was a very popular and hard-working Member until his retirement at the general election after 32 years' service in the House. Their erstwhile constituents hold them all in the highest regard and I shall do my best to continue the high standards of service and dedication to constituents set by those right hon. and hon. Members.
  My task is particularly challenging because, while many hon. Members have spoken of the diversity of their constituencies, few can be quite so rich in diversity as the modern Elmet. It contains the thriving market town of Wetherby, with its famous racecourse, much beautiful countryside, fine villages and prime agricultural land. It contains Allerton Bywater at which is the area headquarters of the National Coal Board and which is at the centre of many close-knit mining communities. Around Boston Spa is the Thorp Arch trading estate, the national lending division of the British library and various penal establishments.
  Many of my constituents live in areas such as Garforth Kippax and Whinmoor and work in the many trades, industries and professions that make Leeds and west Yorkshire so famous around the world. And in the centre of my constituency is Barwick in Elmet, a beautiful village which boasts the biggest maypole in the world. Few issues to be discussed in the House will not affect the richly varied constituency that I am privileged to represent. As my right hon. Friend the Member for Selby said of Barkston Ash in his maiden speech in 1964, it is
  "a microcosm of the country as a whole."—[Official Report, 17 December 1964; Vol. 704, c. 638.]
  The same is true of Elmet, as I have taken over a significant proportion of my right hon. Friend's former constituency.
  There are few issues of greater long-term importance for the economic prosperity and the long-term employment prospects of my constituents and the country as a whole than the need to encourage investment in the creation, development and growth of small businesses not only in existing industries but in the new industries that will take us into the 21st century.
  I declare an interest in that I am a solicitor in a firm which has for many years represented a university, and I have been actively involved in trying to bring the technologies of the universities into industry. I know only too well the problems and obstacles which so often face us. The lesson that we learn from America's success in
  1052
  fields in which we have so often performed relatively badly is that we need to plan long-term. We must bring together the inventor, the entrepreneur, the manager and the financier, and we must keep them together for a long time because the fruits of success rarely come quickly.
  Over a long period the practical effect of our tax structure, including capital transfer tax, is that private investment in industry has been increasingly inhibited. Hence, the organic growth of our small businesses into medium-sized businesses has also become increasingly inhibited. That is at the heart of my objection to the amendment.
  The incentive which business has now is always to maximise short-term profits, to puff up the company and sell it off to realise a quick capital gain rather than to plan for the gradual development of the company, often over two generations or more, as so often happens in Europe and the United States. I have lost count of the number of times when clients come to me as a solicitor in practice with a depressingly familiar story. They have built up a successful private company, and they are faced with trying to decide where to go. Often they say, "It just isn't worth our while expanding, bringing in more money, taking greater risks, when we cannot have the commensurate benefit that goes with it. We cannot pass it on to our children without incurring the heavy cost of insurance to meet the capital transfer tax. Our private Investors similarly feel the effects of the capital transfer tax and want to grasp the profit while they can."
  The hon. Member for Livingston referred to the fact that in this country venture capital is often the prerogative of the institution. It is that fact, compared with the position in the United States where venture capital is often shared between the private investor and the institution, which lies at the heart of our relatively poor performance in this sector. The flexibility, the speed of response and the good working relationships of a well-managed, owner-run business are essential to the health of British industry and will become more so as the years go by. For as long as these businesses are under-capitalised, because death duties and other tax burdens strangle the supply of long-term income, capital and finance, we will see them diminish. We will find this problem—and this is one of my interests—as we try to involve small businesses in the new technologies that are coming out of our universities. If one thing is true of new technology more than other industries, it is that we have to think in the long term. The rewards will not come tomorrow. They must plan for a long-term fight to bring their product on to the market and to sell it profitably. Our attitude to the taxation of venture capital which has built up over the years is counter-productive to this.
  I have heard the arguments that were advanced earlier, but surely the right place to start is by asking, "Where do we want to go? What do we want to achieve?" If the answer is that we seek to create new industries and jobs, we must abandon preconceived ideas and old-fashioned commitments which are counter-productive to those aims. We must reach out to achieve our goals. If that means taking what some people may regard as unpalatable measures, so be it.
  I recognise fully and applaud the Government's great achievement over the past four years in introducing a large number of measures designed to help small businesses. It has been a start. I am sure that the Government will

  1053
  recognise, as I do, that much still remains to be done to bring private enterprise and capital into the small and medium business sector.
  In that context I should like to pay a special tribute to my hon. Friend the Member for Surrey, North-West (Mr. Grylls) who, as national chairman of the Small Business Bureau, has done so much to carry the banner of small businesses into the political arena with such success. I am proud, as a member of the national board of the Small Business Bureau who has represented Yorkshire and Humberside, to have played a small part in that success. I am particularly delighted that so many members of the Small Business Bureau were elected to the House in the general election to reinforce my hon. Friend the Member for Surrey-North West in his task.
  The task before us now is to build upon the achievement of the past four years. In doing that, we shall have to face the fact squarely that capital transfer tax is an obstacle to the end that we seek. The additional relief contained in clause 10(1) will be gratefully received. It is a step in the right direction, but I urge that there should be a radical reappraisal of the basis of capital transfer tax as part of long-term strategic thinking at the earliest possible opportunity insofar as it impacts upon small and medium business and venture capital in such businesses. The revenue involved is relative small. The hon. Member for Livingston described it earlier as "crumbs". I call it seedcorn.
  Venture capital is the basis upon which our industrial development will depend. In response to the request for evidence to prove that our tax structure has discriminated against the provision of private venture capital in the past, I invite the Opposition to look in detail at the contrasting experience of the United States of America where money from private investors for high risk venture capital investments is readily forthcoming and where many jobs in many high technology industries have been created as a consequence.
  We sit upon a gold mine of inventive genius in our universities, of entrepreneurial flair and financial acumen. We must not allow our tax structure to prevent us from exploiting those resources to the fullest possible extent because, if we do, the Americans, the Japanese and the Germans will exploit to the full the opportunites that we miss just as they have done so often before.
  I quoted earlier from the maiden speech of my right hon. Friend the right hon. Member for Selby. I conclude by paraphrasing part of the maiden speech of the right hon. member for Leeds, East. He said that he knew that he had touched upon ground which might be considered controversial, but he assured the House that he had no intention whatever of being polemical or partisan.
  I hope that my contribution today will be received as a sincere effort to think the problem out. I thank the Committee for its forbearance and courtesy.
  6.15 pm
  Mr. Hayhoe: It is a most agreeable task to congratulate my hon. Friend the Member for Elmet (Mr. Batiste) on his splendid maiden speech. He was able to speak from personal knowledge and experience of small businesses. He spoke with great clarity. He combined passion and humour and he was brief. Those qualities commend themselves as the essential elements of the best
  1054
  parliamentary speeches. Every hon. Member will wish to hear him speak again on these matters. His comments on the clause about capital transfer tax, especially for small businesses, will have been noted.
  I was especially interested in what my hon. Friend said about linking the research done in universities with the industrial applications. It is good that he is facilitating that in his part of the world. So often in Britain marvellous work has been done in our universities or research institutes, but the industrial application has been exploited in other parts of the world. His message on that issue will commend him to the Committee. I hope that we will find ways to facilitate that to which he has set his hand.
  The hon. Member for Blackburn (Mr. Straw) asked about the cost of the measures. It is £2 million for the business side and £3 million for the agricultural side, giving a total of £5 million for a full year. The reasons for pursuing relief for industry were amply given by my hon. Friend the Member for Elmet in his speech. I endorse what he said. The increase in agricultural relief will alter the present balance of relief between let and owner-occupied land and should provide further encouragement to owners to relet land when a tenancy falls, rather than take it in hand themselves.
  The propositions are warmly endorsed in all parts of the Committee. I hope that the Committee will support the clause and that the Opposition will withdraw their amendment.
  Mr. Straw: When I wrote amendments to clause 10 to provide a vehicle for discussion, I little thought that they would also become the vehicle for a maiden speech. Even less did I think that they would be the vehicle for such an eloquent and witty speech, which was also thoughtful and provocative. I congratulate the hon. Member for Elmet (Mr. Batiste). I regret that not more hon. Members were present to hear his speech.
  I thank the Minister for the information that he gave, and I beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Clause 10 ordered to stand part of the Bill.

Clause 11

  PAYMENT OF TAX BY INSTALMENTS
  Mr. Straw: I beg to move amendment No. 12, in page 9, line 7, leave out subsection (1).
  The Second Deputy Chairman of Ways and Means (Mr. Paul Dean): With this it will be convenient to discuss amendment No. 13, in page 9, line 12, leave out subsection (2).
  Mr. Straw: Under clause 11 the facility for paying capital transfer tax by instalment is extended from eight years to 10 years. We have tabled the amendments to discover the reason for that change.
  The Economic Secretary to the Treasury (Mr. John Moore): I appreciate the tenor and the way in which the hon. Member for Blackburn (Mr. Straw) has requested further, legitimate information. It is important for the wider public.
  The purpose of amendment No. 12 is to annul the proposed increase in the capital transfer tax instalment period from eight to 10 years. The instalment facility recognises that taxpayers may find difficulty in paying in

  1055
  one sum the capital transfer tax attributable to certain types of property which are not readily marketable; or alternatively that meeting the liability would entail selling some of the property concerned, possibly to the detriment of, for example, a business.
  If the taxpayer elects to pay by instalments, the number of annual instalments is eight. It has been represented on a number of occasions that as a measure of help particularly to businesses, including agriculture, the number of instalments should be increased.
  The Government have some sympathy with that point. We propose to increase the number of annual instalments from eight to 10. That ties in with the 10-yearly charge on discretionary trusts so that where the property of a trust is such that the tax can be paid by instalments, one instalment will be payable each year. At the same time, the opportunity is being taken to simplify the present scheme by withdrawing the facility to pay by half-yearly instalments, which is comparatively little used.
  I am sure that the hon. Member far Blackburn will understand the relevance of the first part of the clause, and that he will not wish to press his amendment.
  The purpose of amendment No. 3 is to annul the proposed increase from £5,000 to £20,000 in the de minimis limit. For the tax on unquoted shares to be payable by instalments, the value transferred attributable to them must exceed £5,000, and they must represent at least 10 per cent. of the company's nominal share capital: or, if they are ordinary shares, must reptesent not less than 10 per cent. of the value of such shares. The de minimis limit of £5,000 has remained nominally unchanged since 1975. The extension by the Labour Government with effect from October 1977 of business relief to minority holdings in unquoted companies at a rate of 20 per cent., meant that for practical purposes the limit was then reduced to £4,000 and with the further increase to 30 per cent. agreed in clause 10 there will be a further reduction to essentially £3,500 on the old limit, or £14,000 effectively on the proposed £20,000 de minimus limit.
  The limit itself is clearly overdue for revalorisation. The equivalent in real terms today of £5,000 in 1975 is something over £13,000. An increased limit of £20,000 will, after taking account of the proposed 30 per cent. business relief, produce an effective limit of £14,000, broadly matching the limit as it was in 1975.
  It is useful for the Committee to put these specifics on the record, and I thank the hon. Member for Blackburn for providing the opportunity. I hope that he will withdraw his amendment.
  Mr. Straw: In the light of the Minister's comments, I beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Clause 11 ordered to stand part of the Bill.

Clause 12

  DOMICILE
  Question proposed, That the clause :stand part of the Bill.
  Mr. Straw: This clause raises a rather more substantive question than the previous three clauses. It proposes to exempt from charge to capital transfer tax certain people who were domiciled in the United Kingdom but who, since 1974, have at some stage become
  1056
  domiciled in the Channel Islands or the Isle of Man. I am sorry to see the right hon. Member for Guildford (Mr. Howell) leaving the Chamber as I wish to quote some remarks that he made in 1975. I hope that he will remain for a few more minutes.
  It is well known that most countries determine which legal system should apply for the purpose of taxation by reference to an individual's nationality, but in Britain and some Commonwealth countries it is not nationality but domicile that determines the relationship between the individual and a country's tax regime. Although domicile has been a useful concept in matrimonial law, it is complicated and often imprecise. Because of its complexity and imprecision, it has been plain that those who have drafted tax legislation have found it inadequate. Time and again they have had to add definitions to domicile and add qualifications to residence to bring people into charge. That is certainly the case in company taxation.
  In 1975 the Labour Government brought forward proposals for capital transfer tax. They recognised that simply to leave the test of chargeability to domic:le would be inadequate and that there would be many loopholes. They proposed in what became section 45 of the Finance Act 1975 that people, even if they were not domiciled in the country at the time of the charge, would be subject to charge of capital transfer tax if one of three tests was fulfilled: first, that they had within three years preceding the charge been domiciled in this country and then moved either to the Isle of Man or the Channel Islands; secondly, that within 17 of the preceding 20 years they had been domiciled in countries other than the Isle of Man or the Channel Islands; and thirdly, that they had been domiciled in this country before 10 December 1974 but subsequent to that date had moved to the Channel Islands or the Isle of Man.
  6.30 pm
  When this was discussed in Committee in February 1965 many Conservative hon. Members, who were then in opposition, became highly exercised about this issue. The right hon. and learned Member for Dover (Mr. Rees), the present Chief Secretary, suggested that if the clause were passed civilisation would virtually come to an end. He said:
  "This provision not only affects those who give up English domicile to assume domicile there but also imperils to a degree the well being—even the economy, and perhaps the political status — of those, until now, favoured islands." — [Official Report, Standing Committee A, 13 February 1975; c. 1649.]
  Some of his hon. Friends went in for similar examples of exaggerated overblown hyperbole. Despite the opposition of Back Benchers, the right hon. member for Guildford, who led Conservative Members of the Committee on that occasion, listened carefully to the persuasive words of Joel Barnett, the then Chief Secretary, and suggested to his hon. Friends that they should not press the matter to a Division. He said:
  "The need for Chief Secretaries of whatever Government to seek means of trying to secure the revenue and avoid tax avoidance is something that any responsible party or Government must recognise."—[Official Report, Standing Committee A, 13 February 1975; c. 1684.]
  Those words from 1975 remain as true today.
  Joel Barnett explained why those who are domiciled in this country and had then moved to the islands were treated differently from those who had moved to anywhere else. He said:

  1057
  "The first is their geographical proximity. It has been a relatively simple matter in the past for a person to establish legal domicile in the Channel Islands— and thus lose his United Kingdom domicile — by acquiring the appurtenances of a domicile in the Islands—a house, for example—without in reality severing his connections with the United Kingdom."— [Official Report, Standing Committee A, 13 February 1975; c. 1655–6.]
  The second reason was that the Channel Islands were within the area where controls operated. We recognise that exchange controls have been abolished since October 1979 so that argument does not apply, and will not apply, until exchange controls are introduced by this Government because they are forced to, or by the next Labour Government because we think it desirable.
  But Joel Barnett's main point still stands. It is in practice far easier to move one's domicile to the Channel Islands while still maintaining a major connection with this country than it is to move to the Cayman Islands or to other tax havens. Given that fact, and given that the right hon. Member for Guildford acknowledged the need to prevent tax avoidance and evasion by people moving to the Channel Islands, we were shocked to see that the Government propose in clause 12 to abandon altogether section 45(1)(c) of the Finance Act 1975.
  The Economic Secretary may argue that to have a cutoff date of 10 December 1974 for ever and a day is anachronistic because time moves on. We accept that point but the sensible way forward would have been to provide a moving cut-off date—for this year it could be 1974, for next year it could be 1975 and so on. We do not accept the case for abandoning altogether this important safeguard against tax evasion. Despite the flowery words of the Chief Secretary, who I am glad to see has come into the Chamber on cue, and his powerful opposition to section 45(1)(c) of the Finance Act 1975—I reminded the Committee a moment ago that the right hon. and learned Gentleman said that civilisation would virtually come to an end if the clause were passed, and it would affect the economy and even the political status of the Channel Islands and Isle of Man—the Government have not seen fit to change the clause. I assume that they too have seen merit in maintaining it.
  We do not believe that it should be changed. We should like to know a good deal more about the so called "small loss of revenue" that the Financial Secretary suggested was at risk when he spoke on Second Reading on 6 July. Above all, we should like to know why when they have retained the clause for the past four years and when they know that there are risks of major tax avoidance and evasion from people who in reality live in this country but move their domicile to the Channel Islands, they have thought fit to abandon this safeguard.
  Mr. John Moore: I should like to respond briefly to the gentle way in which the hon. Member for Blackburn (Mr. Straw) covered this historical debate. It is pleasant to do so with my right hon. and learned Friend the Chief Secretary beside me. I will never be able to match either his wisdom or the poetic way that he manages to express his thoughts. So I shall not go back to 1975 to reiterate what he said.
  The hon. Member for Blackburn legitimately reminded us of the importance of domicile. The Government propose a modest change in domicile and I shall of course deal with the point raised about tax loss liability.
  1058
  Domicile is an important concept for capital transfer tax purposes. Someone who is domiciled here is liable to the tax on transfers of his assets wherever they are situated; someone who is domiciled abroad is liable only on property in the United Kingdom. Domicile can therefore have a major effect on capital transfer tax liabilities.
  The test of domicile is, under general law, essentially a subjective one. Broadly it depends on where a person's permanent home is. This in turn depends very much on intention as well as on facts and evidence about intention and is often difficult to establish authoritatively. However, liability to taxation can scarcely be left to a taxpayer's unsupported assertion; and when a dispute about domicile comes to appeal it can take a long time to settle. It is equally difficult to demonstrate that someone of foreign origin has become domiciled here in the face of assertions that he ultimately intends to return to his country of origin, even though he has spent the greater part of his life here, and to maintain that someone who was originally domiciled here has not acquired a foreign domicile, even though he emigrated very recently in the face of claims that he has severed all links with this country and intends to reside permanently abroad.
  The hon. Member for Blackburn rightly drew our attention to section 45 of the Finance Act 1975 and the discussions surrounding it. It set out a series of objectives tests for determining domicile for capital transfer tax purposes—the "deemed domicile" rules—in addition to the general law.
  These rules cover three situations. The first provides, in effect, that a domicile in the United Kingdom cannot be lost for tax purposes until three years after it has been lost under general law. The second provides that someone who has been resident here for income tax purposes for 17 out of the past 20 years of assessment is to be treated as domiciled here, whatever his domicile under general law. The third—to which we are addressing ourselves in this clause—provides that someone who has been domiciled here and acquires a domicile in the Channel Islands or the Isle of Man, both known as the offshore islands, is treated as remaining domiciled here without limit of time.
  It is only the third situation to which we are particularly addressing ourselves in relation to the clause; that is, that someone who has been domiciled here and who acquires a domicile in the Channel Islands or the Isle of Man— both known as the "offshore islands" — is treated as remaining domiciled here without limit of time. The hon. Gentleman reminded us of the debate and gave an accurate description of part of the essential argument at the time.
  The original justification for the rule applying to emigrants to the offshore islands was that they were thought to provide particularly convenient bases for those who wished to maintain some contact with the mainland. Moreover, at the time when the rule was introduced the islands were within the exchange control area. It was thus easier to shift property there than elsewhere abroad. The rule has been strongly resented in the islands as being discriminatory. The removal of exchange control restrictions has deprived one of the main arguments in support of the special rule of its force.
  It is estimated that the cost of abolishing the special rule for the offshore islands would be £1 million in 1983–84 and £2 million in a full year—not vast sums but noticeable ones. Essentially, therefore, the clause seeks to abolish the exception to the general law to bring the treatment of those

  1059
  becoming domiciled in the Channel Islands or the Isle of Man into line with that of those becoming domiciled elsewhere outside the United Kingdom. I hope, on the basis of that explanation—though I appreciate that the hon. Gentleman does not accept the tenet of the clause—that he will not press the matter to a Division.
  Question put and agreed to.
  Clause 12 ordered to stand part of the Bill.

Clause 13

  BURDEN OF TAX
  Mr. Barry Sheerman: I beg to move amendment No. 16, in page 10, line 3, at end insert—
  '(1B) Property which is normally situated in the United Kingdom but which at the date of the death is temporarily outside the United Kingdom shall be treated for the purpose of subsection (1) above as property in the United Kingdom unless immediately before the date of the death it has been outside the United Kingdom for a continuous period exceeding one year.'.
  The Second Deputy Chairman: I suggest that with this it will be convenient to take the following amendments: No. 17, in line 9, leave out 'This' and insert `Subsections 1 and 2 of this'.
  No. 18, in line 11, at end add—
  '(4) Where the estate of a person who died before the passing of this Act included immediately before his death any land in the United Kingdom other than settled land, and he did not indicate by his will how the relevant tax was to be borne his personal representatives shall not be liable at the suit of any beneficiary of the estate for acting in good faith on either of the two views mentioned below.
  In this subsection "the relevant tax" means tax on the value transferred by the chargeable transfer made on the death so far as it is attributable to the value of the land and the two views referred to are—

  (a) the view that the relevant tax fell to be borne by the land and

  (b) the view that the relevant tax fell to be borne as part of the general testamentary and administration expenses of the estate.

  (5) Subsection (4) of this section shall apply to deaths before 5 June 1981 in relation to land situate in Scotland and to deaths before the day on which this Act is passed in relation to land situate in England and Wales or Northern Ireland.'.
  Mr. Sheerman: I congratulate the new hon. Member for Elmet (Mr. Batiste) on his speech; I feel it proper that he should receive congratulations from the Back Benches as well as the Front Benches. I enjoyed his speech and there were elements in it which showed that in any election one can never predict the quality of people coming into Parliament. The press may predict that placemen" are being brought in, but as the vote last night showed, men and women of independent judgment have come here. I enjoyed the hon. Gentleman's speech, especially the humorous passages in it, and I thank him for his kind remarks about some of my former colleagues on the Opposition Benches.
  It might help if I gave some background to this series of technical amendments. Capital transfer tax was introduced under section 28, and the related paragraphs of schedule 4, of the Finance Act 1975. Until 1981, the accepted view was that when free real property passed to a beneficiary under a will, the beneficiary himself or herself was liable to pay capital transfer tax, when relevant. A decision by the Court of Session in Scotland in Re Dougal in 1981 gave a new interpretation to the law
  1060
  governing capital transfer tax. The decision was that capital transfer tax should be paid not by the beneficiary but out of the residue of the estate.
  6.45 pm
  Because England and Scotland have separate legal systems, there was confusion as to whether that new interpretation of the law should hold good in English courts. Clause 13 of this Bill confirms the Scottish decision for both England and Scotland, and thus removes uncertainty for all cases where a death occurs after the Finance Bill becomes law.
  However, it is not clear under present law, as modified by this clause, what happens in the case of moveable property—that is dealt with by amendment No. 16—and it is not clear what the implications of the law now are for those cases in which capital transfer tax was charged to the beneficiary under the old, pre-1981 interpretation of the law on free real property between the passing of the 1975 Act and the present. This series of amendments seeks to clarify the law on both points.
  The proposed subsection (1B), which is to be inserted in section 28 of the Finance Act 1975, provides that all moveable property which is normally in England shall be treated as being in the United Kingdom at the moment of death of its owner, even if it is actually abroad at the time, except in cases where the property has been outside the country for more than one year. To give a simple example, if one lends one's car to a son or daughter and it is taken on holiday to France, and if one dies while it is there, the car, the property, is counted as having been in the United Kingdom for purposes of tax.
  Amendment No. 17 is technical and allows amendment No. 18 to take place. That amendment would add subsections (4) and (5) to clause 13. It is designed to protect personal representatives of a deceased person, executors—sometimes a much-maligned class of people; the result of Agatha Christie novels or occurrences in real life—who have administered the estate either according to the pre-1981 interpretation or to the later Scottish decision in Re Dougal. As the law stands, there is a possibility that disgruntled beneficiaries could take the executors to court.
  It may be that a beneficiary has paid capital transfer tax when, on the new interpretation, he would not have been liable, or it may be that other beneficiaries under the will consider that they have been unjustly treated in having to pay capital transfer tax from the residue of the estate, when the common view was that the recipient of the free real property should be liable, until the 1981 decision, to pay the tax. In either case, provided that those administering the estate acted in good faith, and provided that there was no instruction to the contrary included in the terms of the will, there should be no possibility of aggrieved beneficiaries taking legal action against those administering the estate.
  The differences in dates for Scotland and England proposed in subsection (5) are the natural consequence of the differing interpretations of the law relating to capital transfer tax which have obtained in Scotland and England between 5 June 1981 and the date of the passing of the Bill.
  I appreciate that these are technical amendments. I thank hon. Members for bearing with me and I look forward with interest to the Minister's response.
  Mr. John Moore: The hon. Member for Huddersfield (Mr. Sheerman) and I share what I was about to call a clear

  1061
  advantage but, then, my right hon. and learned Friend the Chief Secretary is sitting behind me and he is a lawyer; I was about to say that we are not lawyers. The hon. Gentleman was courteous enough to alert me in advance of what is an important area of great technical and legal difficulty, as opposed to financial technicality. The hon. Member for Livingston (Mr. Cook), who I see taking a keen interest in this subject, will be proud to know that it was Scottish law, as in so many other things, which led the way, and we are seeking in the clause to carry that forward.
  As the hon. Member for Huddersfield said, clause 13 is intended to remove uncertainty about the incidence of capital transfer tax where the will is silent about incidence. Until the judgment in a Scottish case in June 1981—called variously Re Dougal or Cowie's Trustees—there has been room for doubt as to the rule in such circumstances in cases in the rest of the United Kingdom. The clause attempts to remove that uncertainty by laying down a rule of incidence, and the rule follows the Re Dougal decision. The proposed rule is quite arbitrary and leaves not unimportant questions unanswered. There is no obvious reason why a period of one year should have been chosen as a test. Moreover, the rule would apparently operate only if the property concerned was normally situated here but was temporarily situated elsewhere at the time of death. The amendment gives no guidance on how these preliminary questions are to be determined.
  Amendments Nos 17 and 18 relate to the absence of protection of personal representatives. As the clause will not become effective until the Bill is enacted, uncertainty will remain until then for personal representatives administering estates outside Scotland. It has been suggested that those who have administered estates on the basis of one view or the other during this period of uncertainty may be open to legal action by disgruntled beneficiaries. There have been fears that faced with this danger some personal representatives will not act at all. It has therefore been suggested that the legislation should contain provisions retrospectively covering actions taken by them, whether they have acted on the basis of the Dougal decision or on a previous understanding of the law. Amendment No. 18 would attempt to provide that sort of protection.
  Amendment No. 17 is a consequential change to the commencement provisions of clause 13. Ministers have sympathy with executors, who take on a responsible job, often for no reward. They have no wish to make life more burdensome for such people. In any area of uncertainty executors have a duty to administer the estate in accordance with the law. It is not open to an executor to make up his own mind, without proper guidance, on the course of action that he should take where there is uncertainty. The amendment would introduce a novel concept into the administration of estates by providing that an executor could sidestep areas of uncertainty, leaving beneficiaries to fight out the matter among themselves.
  Uncertainty about the incidence of tax is only one of many uncertainties with which an executor may be faced in construing a will. There is no reason why beneficiaries should retrospectively be deprived by legislation of their rights to have the estate properly administered in accordance with the law prevailing at the time.
  1062
  It is clear that these rights are matters for the courts. Existing law provides executors with an appropriate means of protection. Section 61 of the Trustees Act 1925 allows the court to exonerate an executor who has acted reasonably and honestly. For Scotland there is broadly similar provision in section 32 of the Trusts (Scotland) Act 1921. The provisions of these Acts are of general application, but there is no obvious reason why they should be supplemented by provisions to cover this rather special case. We believe that they are adequate as they stand.
  It has been argued that if reliance were to be placed on them alone there could be a flood of applications to the courts. We feel that these fears have been much exaggerated. There has been no such flood in Scotland since the Dougal decision upset the previously accepted view of the law. There is no cause to think that the situation would be any different in the rest of the country.
  Treasury Ministers have been aware for a considerable time of views expressed by the Law Society and others that there should be retrospective protection for executors. However, after careful consideration we have, with the agreement of the Lord Chancellor, concluded that the current safeguards for executors strike the right balance between the security of the executor and the rights of the beneficiary.
  I hope that this explanation will be helpful. The hon. Member for Huddersfield, like myself, does not have a legal mind. However, I thank him for raising issues that are clearly important following the improvement that the clause will introduce in the post-Dougal era.
  Mr. Sheerman: I hope that the benefit to Re Dougal, wherever he may be, will be felt very shortly. I beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.

Clause 13

  BURDEN OF TAX
  Question proposed, That the clause stand part of the Bill.
  Mr. Straw: The Opposition welcome this change in the law, which will overcome a difficult anomaly.
  Clause 13 ordered to stand part of the Bill.

Clause 14

  DEVELOPMENT LAND TAX: CERTAIN OPERATIONS RELATING TO TELECOMMUNICATIONS NOT TO BE DEVELOPMENT
  Question proposed, That the clause stand part of the Bill.
  Mr. Cook: Like the Economic Secretary to the Treasury, I am not a lawyer. That being so, I would welcome his assistance. The notes on clauses are more than usually laconic in their observations. They tell us that the effect of the clause is
  "to exempt development land tax: certain operations relating to the installation of advanced telecommunications systems."
  Although I am not a lawyer, I managed to work that out from the clause.
  I would appreciate a brief statement from the Minister on the necessity for the clause. Why is it necessary for the provisions within it to be in this Bill rather than in next

  1063
  year's Finance Bill? I ask for an assurance that it has nothing to do with the nefarious business that we shall be debating on Monday. I refer to the Telecommunications Bill.
  Mr. John Moore: The clause has a relationship to that business. It makes a technical but important change in development land tax as it affects the telecommunications industry. I shall take a little longer than I had planned to explain these provisions because, quite legitimately, the hon. Member for Livingston (Mr. Cook) wishes to have a proper and full explanation of the clause.
  The Committee will be aware that development land tax was introduced by the previous Labour Administration in a form which the then Conservative Opposition considered, rightly, to be damaging to the land market and the construction industry. The changes that have been made since the Conservative Government came to power in 1979 have ensured that the tax is in general no longer the serious disincentive that it was. Nevertheless, cases can come to light where, because of unforseen circumstances, development land tax could hold back developments that are of importance if we are to continue in the forefront of technological change.
  The clause deals with an incident that recently came to light. It is one of the Government's objectives to stimulate competition and efficiency in telecommunications. The aim is to put British companies in the forefront of world communication activities and so create more jobs in Britain and better services for British consumers. To ensure that effective competition develops in an industry that is dominated by one company, it is necessary that newcomers in telecommunications, such as the Mercury consortium, are not placed at an unnecessary disadvantage. There is already one major disadvantage for such a company in telecommunications. A new company has to set up its network from scratch, and that could give rise to liability to development land tax. This could make the launch of a new system extremely difficult, if not impossible, financially. We cannot allow technological advance and healthy competition to be frustrated in this way.
  Furthermore, activities undertaken by British Telecom under an existing general development order are exempt from DLT. The present order does not apply to a company other than British Telecom. This was another reason why the clause was needed to put competition on a more equal footing. It is the intention to lay before Parliament a revised general development order relating to the activities of British Telecom. The timing of that order is linked to the Telecommunications Bill. It is our intention that the revised order shall extend to other companies in the same business as British Telecom.
  Once the revised order has been made, there will be automatic exemption for the type of operation that is covered by the clause. This explains why the relief is temporary. In a sense, the clause anticipates the making of an order. It would clearly not be right for a company that happens to be active in communications to be disadvantaged relative to those that may come later.
  The clause provides that certain operations in connection with the establishment of new and advanced telecommunications systems are not to constitute development for the purposes of development land tax. That effectively takes them outside the ambit of the tax. Essentially, the operations concerned are cable laying and
  1064
  other closely associated operations. However, the clause will not cover the erection of substantial structures such as administration and control buildings. Their construction will continue to be within the scope of the tax.
  7 pm
  The hon. Gentleman rightly referred to the timing and the need for the proposal. I have explained clearly that the private sector is waiting to get on with the job. Mercury has already started work on the installation of a network. It is vital to its success that it should be completed as quickly as possible. It is therefore crucial that the tax position should be clarified immediately. For those reasons, I commend the clause to the Committee.
  Mr. Robin Cook: Will the Minister refresh my memory? Was the clause in the original Bill?
  Mr. Moore: No.
  Mr. Cook: I am glad that we asked the Economic Secretary these questions. He has fully and frankly stated the purpose of the clause. He will not be surprised to learn that we are unhappy at the consequences. He will be aware that he goes straight to the heart of the debate on the privatisation of the telecommunications system when he says that essential to any private sector company operating the telecommunications business is a network infrastructure such as the sort that is exempt from development land tax under the provision.
  That was a key matter in the debate on the Telecommunications Bill in the previous Parliament and will be the key matter for debate when the Telecommunications Bill starts going through the House on Monday. Many people in the Opposition and outside the House believe that, as there has to be a major and well-disseminated network of telecommunications installations, if any such business is to succeed, it is better that it is organised on the basis of a public body that has responsibility throughout the land for maintaining a single network. The intrusion of a second network which, for example in Mercury and other private companies, feeds off some of the facilities created by the publicly owned body, will disrupt the achievement of an effective, efficient, well-organised and well-invested state network.
  For those reasons, as the Economic Secretary will be aware, we have been opposed to private companies starting to poach in this area. Therefore, the Opposition will have to resist the clause, which provides a favourable tax regime for those companies.
  Question put:
  The Committee divided: Ayes 194, Noes 77.

  Division No.23]

  [7.00 pm

  AYES

  Alexander, Richard

  Brandon-Bravo, Martin

  Arnold, Tom

  Bright, Graham

  Ashby, David

  Brinton, Tim

  Atkins Robert (South Ribble)

  Brown, M. (Brigg & Cl'thpes)

  Baker, Nicholas (N Dorset)

  Bruinvels, Peter

  Baldry, Anthony

  Buck, Sir Antony

  Banks, Robert (Harrogate)

  Budgen, Nick

  Batiste, Spencer

  Burt, Alistair

  Bellingham, Henry

  Butterfill, John

  Benyon, William

  Carlisle, John (N Luton)

  Bevan, David Gilroy

  Carttiss, Michael

  Biggs-Davison, Sir John

  Chope, Christopher

  Blackburn, John

  Clark, Dr Michael (Rochford)

  Blaker, Rt Hon Peter

  Clarke, Kenneth (Rushcliffe)

  Body, Richard

  Colvin, Michael

  Boscawen, Hon Robert

  Conway, Derek

  Bottomley, Peter

  Coombs, Simon

  1065

  Cope, John

  Lloyd, Ian (Havant)

  Cranborne, Viscount

  Lord, Michael

  Currie, Mrs Edwina

  Luce, Richard

  Dorrell, Stephen

  Lyell, Nicholas

  Douglas-Hamilton, Lord J.

  McCrindle, Robert

  Dover, Denshore

  McCurley, Mrs Anna

  Dunn, Robert

  Macfarlane, Neil

  Dykes, Hugh

  MacGregor, John

  Eggar, Tim

  MacKay, Andrew (Berkshire)

  Emery, Sir Peter

  Major, John

  Evennett, David

  Malins, Humfrey

  Fallon, Michael

  Malone, Gerald

  Favell, Anthony

  Maples, John

  Finsberg, Geoffrey

  Marlow, Antony

  Fookes, Miss Janet

  Marshall, Michael (Arundel)

  Forsyth, Michael (Stirling)

  Mates, Michael

  Forth, Eric

  Mather, Carol

  Fowler, Rt Hon Norman

  Maude, Francis

  Fox, Marcus

  Maxwell-Hyslop, Robin

  Franks, Cecil

  Mayhew, Sir Patrick

  Fraser, Peter (Angus East)

  Mellor, David

  Freeman, Roger

  Merchant, Piers

  Fry, Peter

  Meyer, Sir Anthony

  Gale, Roger

  Miller, Hal (B'grove)

  Galley, Roy

  Mills, Sir Peter (West Devon)

  Gardiner, George (Reigate)

  Moate, Roger

  Gardner, Sir Edward (Fylde)

  Moore, John

  Glyn, Dr Alan

  Morris, M. (N'hampton, S)

  Goodlad, Alastair

  Moynihan, Hon C.

  Gorst, John

  Murphy, Christopher

  Gow, Ian

  Needham, Richard

  Greenway, Harry

  Neubert, Michael

  Gregory, Conal

  Newton, Tony

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

  Nicholls, Patrick

  Griffiths, Peter (Portsm'th N)

  Normanton, Tom

  Ground, Patrick

  Norris, Steven

  Grylls, Michael

  Onslow, Cranley

  Hamilton, Hon A. (Epsom)

  Osborn, Sir John

  Hampson, Dr Keith

  Ottaway, Richard

  Hanley, Jeremy

  Page, John (Harrow W)

  Hargreaves, Kenneth

  Page, Richard (Herts SW)

  Harris, David

  Parris, Matthew

  Harvey, Robert

  Patten, John (Oxford)

  Hawkins, C. (High Peak)

  Pawsey, James

  Hayhoe, Barney

  Peacock, Mrs Elizabeth

  Hayward, Robert

  Pink, R. Bonner

  Heathcoat-Amory, David

  Powell, William (Corby)

  Heddle, John

  Prentice, Rt Hon Reg

  Hickmet, Richard

  Price, Sir David

  Hind, Kenneth

  Proctor, K. Harvey

  Hirst, Michael

  Rhodes James, Robert

  Hogg, Hon Douglas (Gr'th'm)

  Rhys Williams, Sir Brandon

  Holt, Richard

  Ridsdale, Sir Julian

  Hordern, Peter

  Robinson, Mark (N'port W)

  Howard, Michael

  Roe, Mrs Marion

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

  Rossi, Hugh

  Howarth, Gerald (Cannock)

  Rumbold, Mrs Angela

  Howell, Rt Hon D. (G'ldford)

  Ryder, Richard

  Howell, Ralph (N Norfolk)

  Sainsbury, Hon Timothy

  Hunt, John (Ravensbourne)

  Sayeed, Jonathan

  Jackson, Robert

  Shelton, William (Streatham)

  Jessel, Toby

  Shepherd, Colin (Hereford)

  Jones, Gwilym (Cardiff N)

  Soames, Hon Nicholas

  Jones, Robert (W Herts)

  Speed, Keith

  Jopling, Rt Hon Michael

  Spencer, D.

  Kershaw, Sir Anthony

  Stern, Michael

  Key, Robert

  Stradling Thomas, J.

  King, Rt Hon Tom

  Tebbit, Rt Hon Norman

  Knight, Gregory (Derby N)

  Thompson, Donald (Calder V)

  Knowles, Michael

  Tracey, Richard

  Lang, Ian

  Trippier, David

  Latham, Michael

  Viggers, Peter

  Lawler, Geoffrey

  Wakeham, Rt Hon John

  Lawrence, Ivan

  Walden, George

  Lennox-Boyd, Hon Mark

  Wardle, C. (Bexhill)

  Lester, Jim

  Watts, John

  Lewis, Sir Kenneth (Stamf'd)

  Wells, Bowen (Hertford)

  Lightbown, David

  Winterton, Mrs Ann

  Lilley, Peter

  Winterton, Nicholas

  1066

  Wood, Timothy

  Tellers for the Ayes:

  Young, Sir George (Acton)

  Mr. David Hunt and

  Mr. Tristan Garel-Jones.

  NOES

  Atkinson, N. (Tottenham)

  Marek, Dr John

  Barron, Kevin

  Mason, Rt Hon Roy

  Beckett, Mrs Margaret

  Meadowcroft, Michael

  Bell, Stuart

  Millan, Rt Hon Bruce

  Bermingham, Gerald

  Miller, Dr M. S. (E Kilbride)

  Bidwell, Sydney

  Morris, Rt Hon A. (W'shawe)

  Boothroyd, Miss Betty

  Nellist, David

  Brown, Gordon (D'f'mline E)

  Patchett, Terry

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

  Pavitt, Laurie

  Bruce, Malcolm

  Prescott, John

  Callaghan, Rt Hon J.

  Radice, Giles

  Campbell-Savours, Dale

  Richardson, Ms Jo

  Cohen, Harry

  Roberts, Ernest (Hackney N)

  Cook, Robin F. (Livingston)

  Robinson, G. (Coventry NW)

  Corbyn, Jeremy

  Rogers, Allan

  Cowans, Harry

  Ross, Ernest (Dundee W)

  Cox, Thomas (Tooting)

  Sheerman, Barry

  Cunliffe, Lawrence

  Sheldon, Rt Hon R.

  Davies, Ronald (Caerphilly)

  Shore, Rt Hon Peter

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

  Short, Ms Clare (Ladywood)

  Dixon, Donald

  Short, Mrs R.(W'hampt'n NE)

  Dormand, Jack

  Skinner, Dennis

  Dubs, Alfred

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

  Dunwoody, Hon Mrs G.

  Snape, Peter

  Evans, loan (Cynon Valley)

  Soley, Clive

  Fatchett, Derek

  Spearing, Nigel

  Field, Frank (Birkenhead)

  Straw, Jack

  Garrett, W. E.

  Tinn, James

  Godman, Dr Norman

  Wainwright, R.

  Hardy, Peter

  Wallace, James

  Harman, Ms Harriet

  Warden, Gareth (Gower)

  Harrison, Rt Hon Walter

  Wareing, Robert

  Haynes, Frank

  Welsh, Michael

  Holland, Stuart (Vauxhall)

  Winnick, David

  Hughes, Robert (Aberdeen N)

  Woodall, Alec

  Kaufman, Rt Hon Gerald

  Young, David (Bolton SE)

  Leighton, Ronald

  McDonald, Dr Oonagh

  Tellers for the Noes:

  McKay, Allen (Penistone)

  Mr. Hugh McCartney and

  McNamara, Kevin

  Mr. Austin Mitchell.

  Madden, Max

  Question accordingly agreed to.
  Clause 14 ordered to stand part of the Bill.
  Clause 16 ordered to stand part of the Bill.
  Schedule 2 agreed to.
  Bill reported, without amendment.
  Order for Third Reading read.
  7.13 pm
  The Chief Secretary to the Treasury (Mr. Peter Rees): I beg to move, That the Bill be now read the Third time.
  As the Bill has been thoroughly and expertly examined in Committee, I need not detain the House long on Third Reading. I have, however, two pleasant duties to perform.
  First, I congratulate my hon. Friend the Member for Elmet (Mr. Batiste) on a notable first contribution to our debates on these matters. My only regret is that there was not a fuller Chamber to hear him. Judging from the quality of his speech, my hon. Friend will not lack an appreciative audience on subsequent occasions.
  Secondly, I congratulate the right hon. Member for Ashton-under-Lyne (Mr. Sheldon) on his assumption of the chairmanship of the Public Accounts Committee. He follows in the very distinguished footsteps of Mr. Joel Barnett, the former right hon. Member for Heywood and Royton. How often we have seen them tackling the same tasks with the same zest and distinction. Our only regret

  1067
  on this occasion is that the right hon. Gentleman's new duties may disable him from taking as full and notable a part in our debates on Finance Bills as he has for about a decade. That marks the closing of a chapter in fiscal history, but I am sure that the whole House wishes the right hon. Gentleman well in his new and distinguished responsibilities. We hope that now and then he will spare a thought for us in our arduous task of examining subsequent Finance Bills.
  I do not need to detain the House further. The general principles of the Bill are well understood and it has been thoroughly examined in detail. I commend the Bill to the House.
  7.15 pm
  Mr. Robert Sheldon: I am grateful to the Chief Secretary for his kind comments, which I much appreciated. I agree wholeheartedly with his comments on the maiden speech of the hon. Member for Elmet (Mr. Batiste). It was indeed a pity that the House was rather less full then than it is now, and it is right that attention should be drawn to the hon. Gentleman's contribution. It is rare to hear a speech of such quality and distinction from a new Member in Committee on a Finance Bill. The hon. Gentleman clearly has much to contribute in Finance Bill Committees and elsewhere. We look forward to hearing from him again.
  In the past week the main elements of economic policy have been before us. The Second Reading of the Finance Bill was immediately followed by the Chancellor's statement on public expenditure. In this way, we have come closest to the aims of the Armstrong committee—to consider revenue and expenditure together and to decide whether we are prepared to exchange taxes for expenditure and whether this or that expenditure is worth this or that extra tax. For the first time, both the House and the Cabinet have been able to do precisely that. When the Chancellor went to the Cabinet to bounce it for £500 million in cuts, members of the Cabinet were entitled to say that as an alternative the Finance Bill could be withdrawn, thus saving the greater part of the public expenditure cuts.
  As a result of the Chancellor's action, the Cabinet and the House have been able to discuss both matters at the same time and to consider possible trade-offs. That is not the way in which we usually debate these matters and it has embarrassed the Government. The reliefs given to the well off by the Bill are in floodlit contrast with the cuts in public expenditure which hit hardest at the rest of our people. The Government's choice has been revealed for all to see. They were not considering a decision on taxation remote in time from another decision on expenditure. The choice was clearly made to reduce provision for the Health Service and other expenditure so as to reduce taxation for the well off.
  The Treasury Ministers' defence is that these tax matters were decided at the time of the Budget and are merely being implemented, but expenditure was also decided at the time of the White Paper in March, when the Government decided not only the cash limits but the programmes behind them. If it is right to adjust one set of decisions in the light of subsequent events, it must be right to adjust the other. Almost uniquely through the conjunction of events Treasury Ministers have been caught with their excuses down, and very embarrassed they have been.
  1068
  I had hoped that the new set of Ministers might have learned something during their sabbatical away from the Treasury. They might have learned from their past mistakes. Their initial reliance on the monetarist faith did not produce the miracles that they expected, but rather than question that faith they are now making fresh sacrifices. They hope that their new and bigger savings on public expenditure will restore the country to economic health. After all, at the beginning of the previous Parliament, in their White Paper on public expenditure, Cmnd. 7746, the Government stated that public expenditure was at the heart of our economic difficulties. It was not economic growth, industrial innovation or the creation of higher skills in management and elsewhere but public expenditure that was to blame. It is to that principle that the Government return. They believe that, if they reduce public expenditure, borrowing declines, taxes can be cut and the energies of our people can be unchained. It is no surprise that tax relief for companies and wealthy individuals forms a prominent part of this and previous Finance Bills.
  I am not sure of the theory behind the tax reductions for the wealthy. It is, at best, suspect. However, it is an unchanging part of Tory philosophy and, more importantly, of Tory practice. The practice is that taxation of the wealthy is reduced, the theory being that incentives are thereby increased. I have long held doubts about tax reliefs of all types that are designed to improve incentives. Many tax reliefs are inevitably complex in their legislative form, as the hon. Member for Elmet rightly said. It is not easy to demonstrate subsequently the beneficial effect that is claimed for them, whether they be on companies or on individuals. One can say with certainty that tax complications may not do much for incentives but, my goodness, they do an awful lot for tax avoidance. It is tax avoidance that will thrive on the complications in this Bill and the hurriedly passed Finance Act 1983.
  Throughout the previous Parliament I desperately hoped, despite my expectations, that the Chancellor would succeed in what must be the aim of anyone with his responsibilities—increasing the prosperity of our people. I have always felt that any Chancellor of the Exchequer should have two overriding objectives — first, the prosperity of the nation, and, second, the proper division of that prosperity between the different parts of our society. On the second point, there must always he a great gulf between the two major parties. We have different attitudes on care, welfare, equality and incentives. We present clear-cut issues to the electorate for it to resolve.
  There ought to be broader agreement on prosperity. We should agree about the encouragement that we should give to industry and the wealth creation process in general. It is a pity that doctrine should play so dominant a role in dividing the major parties. Some of us thought, with the Bank for International Settlements, that the laboratory test of monetarism would have proved conclusive by now. The country has to carry a great extra burden in the form of the errors that still find conviction in the minds of Treasury Ministers. In the next few years, those Treasury Ministers will have a difficult time with the decline of North sea oil output and as our balance of payments position worsens.
  It is indeed a pity that the House has not been presented with a Finance Bill that is more suited to our real problems than the irrelevant and divisive measure that we are offered.
  7.23 pm
  Mr. Michael Grylls: I am aware that the House wants to move quickly to vote on Third Reading. However, there is an amendment on the Order Paper which, alas, because the Bill has been drawn in exceptional circumstances—
  Mr. Deputy Speaker (Mr. Paul Dean): Order. I am sorry to interrupt the hon. Gentleman, but, on Third Reading, he must confine himself to what is in the Bill.
  Mr. Grylls: Alas, the new clause to which I am not allowed to refer was not reached. I hope that the Government will remember that, in the next Finance Bill, they must look to including a clause that deals with unitary taxation that is being applied in the United States on British companies in a grossly unfair way. It is extremely damaging to British industry and it is crucial that the problem be resolved quickly. I hope that the House will send a warning to the United States Administration and Congress that the British Government want the matter to be resolved in the next few months; otherwise a new clause such as we have not discussed today will emerge in the next Finance Bill and force the American Administration to resolve that unfair and damaging practice.
  7.25 pm
  Mr. Richard Wainwright: I, too, shall be brief, but not so brief as to fail to congratulate the hon. Member for Elmet (Mr. Batiste), who has the good fortune to represent part of the ancient kingdom of Elmet, on his accomplished and cogent maiden speech. Nor do I want to be so brief as to fail to associate myself with what has been said about the right hon. Member for Ashton-under-Lyne (Mr. Sheldon), to whom the House owes a special debt. By sticking to this one important subject through many Parliaments, he seems to many of us to have been an anchor man in Budget and Finance Bill debates. We simply rejoice at his promotion to an even more responsible and important task.
  For my right hon. and hon. Friends, the Bill marks a watershed because for those who, like us, have always wanted a radical reform of capital taxes there has until now been the balancing argument that we might disturb capital transfer tax which, for all its maladroitness and deficiencies, was working. The Bill marks a point at which we can ignore those disadvantages because it is plain that capital transfer tax has almost disappeared. It is becoming a voluntary tax and generally nugatory in effect. My right hon. and hon. Friends and I will have no inhibitions in future in presenting the case for an accessions tax—that is the rather more correct term than an inheritance tax. We propose a tax on the recipients of gifts as well as on the recipients of bequests. It will be a tax on those who receive accessions of wealth, not on the donor or testator.
  As the Budget proposals on public expenditure and public revenue, which the House received sceptically in March, have now been admitted by the Chancellor to have broken down because of the hopelessly optimistic and grandiose allowance for shortfall and the absurdly small contingency allowance, it would appear that the Government should have revised the Finance Bill in addition to having revised sharply their public expenditure plans. Because the Government have stubbornly pressed ahead with the Finance Bill against all the danger signals which are so plainly showing themselves, we shall vote against the Bill receiving a Third Reading.
  Question put:
  The House divided: Ayes 185, Noes 72.

  Division No. 24]

  [7.28 pm

  AYES

  Alexander, Richard

  Harris, David

  Arnold, Tom

  Harvey, Robert

  Ashby, David

  Hawkins, C. (High Peak)

  Atkinson, David (B'm'th E)

  Hayhoe, Barney

  Baker, Nicholas (N Dorset)

  Hayward, Robert

  Baldry, Anthony

  Heathcoat-Amory, David

  Banks, Robert (Harrogate)

  Heddle, John

  Batiste, Spencer

  Hickmet, Richard

  Bellingham, Henry

  Hind, Kenneth

  Benyon, William

  Hogg, Hon Douglas (Gr'th'm)

  Bevan, David Gilroy

  Holt, Richard

  Biggs-Davison, Sir John

  Hordern, Peter

  Blackburn, John

  Howard, Michael

  Blaker, Rt Hon Peter

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

  Body, Richard

  Howarth, Gerald (Cannock)

  Boscawen, Hon Robert

  Howell, Rt Hon D. (G'ldford)

  Bottomley, Peter

  Howell, Ralph (N Norfolk)

  Bowden, Gerald (Dulwich)

  Hunt, John (Ravensbourne)

  Brandon-Bravo, Martin

  Jackson, Robert

  Bright, Graham

  Jessel, Toby

  Brinton, Tim

  Jones, Gwilym (Cardiff N)

  Brooke, Hon Peter

  Jones, Robert (W Herts)

  Brown, M. (Brigg & Cl'thpes)

  Jopling, Rt Hon Michael

  Bruinvels, Peter

  Key, Robert

  Buck, Sir Antony

  King, Rt Hon Tom

  Budgen, Nick

  Knight, Gregory (Derby N)

  Burt, Alistair

  Knowles, Michael

  Butterfill, John

  Lang, Ian

  Carlisle, John (N Luton)

  Latham, Michael

  Carttiss, Michael

  Lawler, Geoffrey

  Chope, Christopher

  Lawrence, Ivan

  Clark, Dr Michael (Rochford)

  Lawson, Rt Hon Nigel

  Clarke Kenneth (Rushcliffe)

  Lennox-Boyd, Hon Mark

  Conway, Derek

  Lester, Jim

  Coombs, Simon

  Lewis, Sir Kenneth (Stamf'd)

  Cope, John

  Lightbown, David

  Cranborne, Viscount

  Lilley, Peter

  Currie, Mrs Edwina

  Lloyd, Ian (Havant)

  Dorrell, Stephen

  Lord, Michael

  Douglas-Hamilton, Lord J.

  Luce, Richard

  Dover, Denshore

  Lyell, Nicholas

  Dunn, Robert

  McCrindle, Robert

  Dykes, Hugh

  McCurley, Mrs Anna

  Emery, Sir Peter

  Macfarlane, Neil

  Evennett, David

  MacKay, Andrew (Berkshire)

  Fallon, Michael

  Major, John

  Favell, Anthony

  Malins, Humfrey

  Finsberg, Geoffrey

  Malone, Gerald

  Fletcher, Alexander

  Maples, John

  Fookes, Miss Janet

  Marlow, Antony

  Forsyth, Michael (Stirling)

  Mates, Michael

  Forth, Eric

  Mather, Carol

  Fowler, Rt Hon Norman

  Maude, Francis

  Franks, Cecil

  Maxwell-Hyslop, Robin

  Fraser, Peter (Angus East)

  Mayhew, Sir Patrick

  Freeman, Roger

  Mellor, David

  Fry, Peter

  Merchant, Piers

  Gale, Roger

  Meyer, Sir Anthony

  Galley, Roy

  Miller, Hal (B'grove)

  Gardiner, George (Reigate)

  Mills, Sir Peter (West Devon)

  Garel-Jones, Tristan

  Moate, Roger

  Glyn, Dr Alan

  Moore, John

  Goodlad, Alastair

  Morris, M. (N'hampton, S)

  Gorst, John

  Moynihan, Hon C.

  Gow, Ian

  Murphy, Christopher

  Greenway, Harry

  Needham, Richard

  Gregory, Conal

  Newton, Tony

  Griffiths, E. (By St Edm'ds)

  Nicholls, Patrick

  Griffiths, Peter (Portsm'th N)

  Normanton, Tom

  Ground, Patrick

  Norris, Steven

  Grylls, Michael

  Osborn, Sir John

  Hamilton, Hon A. (Epsom)

  Ottaway, Richard

  Hampson, Dr Keith

  Page, John (Harrow W)

  Hargreaves, Kenneth

  Page, Richard (Herts SW)

  1071

  Parris, Matthew

  Speed, Keith

  Patten, John (Oxford)

  Stern, Michael

  Peacock, Mrs Elizabeth

  Stradling Thomas, J.

  Pink, R. Bonner

  Thompson, Donald (Calder V)

  Powell, William (Corby)

  Tracey, Richard

  Prentice, Rt Hon Reg

  Trippier, David

  Price, Sir David

  Viggers, Peter

  Proctor, K. Harvey

  Walden, George

  Rhodes James, Robert

  Waller, Gary

  Rhys Williams, Sir Brandon

  Wardle, C. (Bexhill)

  Ridsdale, Sir Julian

  Watts, John

  Robinson, Mark (N'port W)

  Wells, Bowen (Hertford)

  Roe, Mrs Marion

  Wilkinson, John

  Rossi, Hugh

  Wood, Timothy

  Rumbold, Mrs Angela

  Yeo, Tim

  Ryder, Richard

  Young, Sir George (Acton)

  Sainsbury, Hon Timothy

  Sayeed, Jonathan

  Tellers for the Ayes:

  Shelton, William (Streatham)

  Mr. David Hunt and

  Shepherd, Colin (Hereford)

  Mr. Michael Neubert.

  Soames, Hon Nicholas

  NOES

  Atkinson, N. (Tottenham)

  McNamara, Kevin

  Barron, Kevin

  Madden, Max

  Beckett, Mrs Margaret

  Marek, Dr John

  Bell, Stuart

  Meadowcroft, Michael

  Bermingham, Gerald

  Mikardo, Ian

  Bidwell, Sydney

  Millan, Rt Hon Bruce

  Boothroyd, Miss Betty

  Miller, Dr M. S. (E Kilbride)

  Brown, Gordon (D'f'mline E)

  Morris, Rt Hon A. (W'shawe)

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

  Nellist, David

  Bruce, Malcolm

  Orme, Rt Hon Stanley

  Callaghan, Rt Hon J.

  Pavitt, Laurie

  Campbell-Savours, Dale

  Richardson, Ms Jo

  Cohen, Harry

  Robinson, G. (Coventry NW)

  Cook, Robin F. (Livingston)

  Rogers, Allan

  Corbyn, Jeremy

  Ross, Ernost (Dundee W)

  Cowans, Harry

  Sheerman, Barry

  Cox, Thomas (Tooting)

  Sheldon, Rt Hon R.

  Cunliffe, Lawrence

  Shore, Rt Hon Peter

  Davies, Ronald (Caerphilly)

  Short, Ms Clare (Ladywood)

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

  Skinner, Dennis

  Dixon, Donald

  Snape, Peter

  Dormand, Jack

  Soley, Clive

  Dubs, Alfred

  Spearing, Nigel

  Dunwoody, Hon Mrs G.

  Stewart, Rt Hon D. (W Isles)

  Evans, loan (Cynon Valley)

  Straw, Jack

  Field, Frank (Birkenhead)

  Tinn, James

  Garrett, W. E.

  Wainwright, R.

  Godman, Dr Norman

  Wallace, James

  Gould, Bryan

  Wardell, Gareth (Gower)

  Hardy, Peter

  Wareing, Robert

  Harman, Ms Harriet

  Welsh, Michael

  Harrison, Rt Hon Walter

  Winnick, David

  Holland, Stuart (Vauxhall)

  Woodall, Alec

  Hughes, Robert (Aberdeen N)

  Young, David (Bolton SE)

  Kaufman, Rt Hon Gerald

  Leighton, Ronald

  Tellers for the Noes:

  McCartney, Hugh

  Mr. Frank Haynes and

  McKay, Allen (Penistone)

  Mr. Austin Mitchell.

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

  Defence
  7.40 pm
  The Minister of State for the Armed Forces (Mr. John Stanley): I beg to move,
  That the draft Army, Air Force and Naval Discipline Acts (Continuation) Order 1983, which was laid before this House on 29 June, be approved.
  The purpose of the order is to continue in force for a further year the Army and Air Force Acts 1955 and the Naval Discipline Act 1957 which together provide the basis for the disciplinary arrangements in the three Services. The concept of annual parliamentary approval for the special legal position of the service man subject as he is to the constraints of military discipline, as well as the rule of civil law, is a long established one in British constitutional practice. Every fifth year, the opportunity is taken to review in depth the needs of the service disciplinary systems, and an Armed Forces Act is passed, making such amendments to those systems as are considered necessary. The most recent such Act was passed in 1981.
  The Select Committee that considered the Act reported that it was satisfied with the procedures under which such Bills are introduced quinquennially with annual continuation orders, such as I am moving today, proposed in the intervening years are the right way to ensure that the working of the Service Discipline Acts is kept under review by Parliament.
  Since the Armed Forces Act 1981 was passed we have seen the dedication, courage and professionalism of our armed forces amply demonstrated in the south Atlantic, and these qualities continue to distinguish their performance and conduct wherever they are serving around the world. The service disciplinary system is an important factor in ensuring that our armed forces measure up to the high standards which we expect and which they have shown.
  I invite the House to approve the Army, Air Force and Naval Discipline Acts (Continuation) Order 1983.
  7.42 pm
  Mr. Kevin McNamara: I welcome the new Minister to the Dispatch Box, making his first speech as Minister of State for the Armed Forces. I hope that all his speeches will as uncontroversial as the one today, but perhaps next week we shall find out.
  Last year, the order went through on the nod, not because the then Minister or I did not wish to speak, but because of a procedural slip-up. A Division was called, and we were in our appropriate Lobbies when it was called off. The Whip, ever eager to get the Government business through, nodded his head when the order was read out. Therefore, if my speech is a little longer than I would have wanted, blame not me but the Government Whip of yesteryear.
  As the Minister said, this is an important constitutional measure and it is right that Parliament should consider it properly. It establishes parliamentary and civilian control over the armed forces. Originally, this was done through annual Acts, but now it is done through quinquennial reviews, followed by yearly affirmative orders. The exercise of that democratic control by the House is proper and in 1976 the Select Committee on Defence, when

  1073
  invited to consider abandoning the affirmative yearly orders, quickly refused and jealously kept that power for the House. It would not consider abandoning the orders.
  The Select Committee on the Armed Forces Bill of two years ago made a number of recommendations when it reported, and it would be interesting to see how much, if any, progress the Government have made. Most of the recommendations were made before the Falklands campaign. The Minister has, quite rightly, paid tribute to the forces that played a part in the campaign, and I readily add my applause. However, some of the matters that were raised merit consideration, and I hope that the Department now has time to consider some of them.
  Some of the recommendations made by the Select Committee have been overtaken by a new sense of urgency. I shall attempt to deal seriatim with the report, with particular reference first to those recommendations for action by 1986, and then to those administrative matters that it said merited some consideration. First, there is the treatment of young service offenders, and two issues are involved here. The 1981 Act very properly arranged for young service offenders to serve sentences, where appropriate, in civilian and not service institutions. However, paragraph 7 of the report showed a serious omission, and difficulty. It suggested that there were not adequate social inquiry reports made on the background of young offenders. The general defence of the circumstances was that the commanding officer would, or should, know sufficient about the background of the men under his command, and that there would be ample opportunity for officers defending those involved to get a proper social report.
  The Select Committee was not convinced and, when talking about the right of the officer to defend the young offender, said:
  "We believe that these factors represent a reasonable protection of the accused's interests but recommend that consideration be given before the 1986 Armed Forces Bill is introduced to the evolution of a system under which social inquiry reports on young Service offenders could be made more readily available to courts-martial. We note that the Navy is already moving in this direction."
  As that recommendation is an administrative matter, it will be interesting to know what progress, if any, has been made by the Government.
  It is interesting to note that the Select Committee thought, on the evidence, that this was not an enormous problem, as only about 25 young service men were likely to be involved. However, there has been a change because of the one-year youth training schemes for the three services, to become operative in the autumn. Over 5,000 young people a year will enter the services for 12 months, subject to military law and discipline. Although I hope that they will not, many problems may arise. There will be a need for a full social inquiry to be made available to the courts because, as the Select Committee pointed out, the traditional service view could not properly apply. If it did not properly apply to long-term recruits, it would not be of a great deal of help to young men and women who are merely in the Forces for 12 months.
  My second point arises from clause 2 of the 1981 Act, which refers to the treatment of young people and says:
  "Where a person … has attained seventeen years of age but is under twenty-one years of age".
  1074
  However, the statutory instrument creating the youth training schemes within the services talks about
  "A person who has attained the age of 16 years but has not yet attained the age of 18 years".
  What happens in disciplinary matters for that young person between the age of 16 and 17? He may be treated in the same way as people in the young leader regiments and youngsters who are joining the services, but the point still needs to be cleared up because the main legislation under the Act deals with young people between the age of 17 and 21 and the youth training scheme applies to youngsters betwen 16 and 18.
  Clause 17 of the 1981 Act abolished the death penalty under the Naval Discipline Act 1957 for civilians who spy for the enemy on board one of Her Majesty's ships or in a naval establishment abroad. The Government argued, and the Select Committee tended to agree, that the death penalty should be kept. It said:
  "Retention of the death penalty is necessary as a deterrent given that a potential offender on the battlefield, where death may result from obeying orders, is unlikely to be deterred from assisting the enemy by no more than the possibility of imprisonment".
  I do not want to rehearse last night's arguments, but the Select Committee commenting on the definition of the word "enemy", to which it turned its attention—that is,
  "all persons engaged in armed operations against any of Her Majesty's forces, including all armed mutineers, armed rebels armed rioters and pirates"—
  said that it
  "seems open to an alarmingly wide number of interpretations".
  Last night, the House refused, by 116 votes, to approve capital punishment for murders resulting from acts of terrorism, by 81 votes for the murder of a police officer during the course of his duties, by 96 votes for the murder of a prison officer during the course of his duties, and by 170 votes in the case of murder as a result of shooting or causing an explosion. One can only repeat and emphasise that the definition, which the Minister seeks to maintain and which the Select Committee said was
  "open to an alarmingly wide number of interpretations",
  needs careful attention. We expect to have an early statement from the Government about their intentions, following last night's votes, and bearing in mind the way in which the Army has been employed recently.
  The Select Committee then considered drug and alcohol abuse. The Committee felt that more money should be spent on the remedial treatment of alcoholism, propaganda, and information which might help to reduce the amount of heavy drinking in the Services. It would be interesting to know whether the Government have been prepared to spend more money on that.
  Perhaps one of the most interesting matters raised by the Select Committee concerned the number of drug offences. The report said:
  "The number of drug offences committed is well below one per thousand Servicemen a year and most offences are with soft rather than hard drugs and are committed by men who have not tried drugs other than on an infrequent basis".
  It is certainly true that the Crown's forces do not have the problems of drug abuse that exist in other nations' Services, and I am sure that that fact has much to do with the fact that we have a highly professional volunteer service. However, it exists to a certain extent, and the Navy, taking the problem on board, started to use specialised drug squads. The Select Committee recommended that the Army and the Air Force should follow the Navy's lead in this matter, and should do so before the

  1075
  1986 Armed Forces Bill was introduced. As this is a continuing item, it would be interesting to know what has happened.
  The Committee also recommended that courts-martial procedure should again be examined, and considered whether service men should be tried at least by some of their peers, and not merely by commissioned officers. The Ministry's argument was that it would not be necessary, and that generally service men preferred to be tried not by their peers but by a commissioned officer. However, the Committee felt that that was too easy a reply, and pointed out that not since the Lewis committee and Pilcher committee reports in the 1940s had the matter been properly examined. It believed that a full review should take place of all courts-martial procedures before the introduction of the next quinquennial review. Clearly, such a review takes a great deal of time and care, as so many issues are involved. Accordingly, the Government should now be thinking about setting up such an inquiry. It would he interesting to know what progress has been made.
  On the question of professional legal staff, the Select Committee drew attention to the different practices in the services. It pointed out how the Navy took commissioned officers and then sent them to train, as selected volunteers, to read for the Bar, whereas the Army and the Air Force tended to recruit already trained solicitors and barristers. It felt that the Navy's system was perhaps cheaper and that the other two services should consider following that procedure.
  The Select Committee further considered whether more civilians could be used in courts-martial in both prosecution and defence roles. The general attitude of the services, particularly in prosecution cases, has been that a knowledge of military law and military lore would be of far more advantage, and that a civilian prosecutor might be at a disadvantage in certain cases. However, there must be many cases in the armed services similar to cases in civilian life, except for the fact that the person alleged to have committed the offence wears a uniform. As the Committee said, there might be a saving in time and money if more civilians were employed. Again, I hope that the Minister will be able to tell us what progress, if any, has been made.
  Clause 13 provided for the treatment of servicemen and people in service employ who suffer mental illness or disorder while abroad, and tried to lay down the legal procedure to be followed before a person was returned to the United Kingdom for treatment under the Mental Health Act. The Committee felt that where two medical men were certifying a patient, it would be helpful if one were a civilian, preferably with psychiatric training. Obviously, it recognised that in many cases that would not be possible, but it recommended that wherever possible that should be done. It would therefore be interesting to know the number of cases in which that has been done, and indeed whether the recommendation has been followed.
  The Committee also dealt with the problems of children and young people in care abroad, who are likely to be ill-treated and exposed to moral danger, or are beyond control. It pointed out that although a fine legal procedure had been laid down for people suffering from mental disorder, the Department had not followed the example given in clause 13 in clause 14. It recommended that the Ministry should give urgent consideration to the construction of a legal framework analogous to that found
  1076
  in clause 13, within which such situations can be regulated. In any event, the Government should report to the House before the 1986 Armed Forces Bill, either in a Defence White Paper or in an appropriate defence debate on the working of these powers. We should therefore like to know when we are likely to have those reports and the way the procedures have been going.
  There are three other matters that are not of such great importance and so can be dealt with quickly. First, there is the assimilation of the women's services into the armed forces. It said that that was going well, except for the enormous anomaly, pointed out on various occasions in the House, and by the former Member for Eton and Slough, Miss Lestor, over the position of the Charity Commissioners in connection with the Royal Star and Garter home. They said that women could not be treated there, even though they were part of the armed forces. The trustees felt that they could not appeal against that, and the Committee recommended that the Government should find some way to intervene in the matter, either legislatively or otherwise. Perhaps the Government have already dealt with the matter, and my former colleague has not informed me of it. Nevertheless, that must be looked at.
  My final point relates to detention centres. I see that the hon. and learned Member for Colchester, North (Sir A. Buck) is here. We met some of his colleagues when we visited the Falklands. The detention centre there was very different from that in his constituency. It is smaller, with no service men in it, which is rather fine. What progress has been made in the building of the new military training correction centre?
  I apologise if I have spoken for rather a long time on a matter that would normally have been dealt with more quickly. Nevertheless, this is an important order of constitutional importance and some matters need consideration. In particular, we must consider the position of young people and the Government's attitude to capital punishment within the armed forces following the votes in the House last night and the decision that there should not be capital punishment for many cases that are presently cited in the Discipline Acts. If capital punishment should not apply in civilian life to murderers of prison officers and police officers, acts of terrorism and others, it should not apply in military life.
  8 pm
  Dr. Alan Glyn: First, I congratulate my hon. Friend the Minister on his first appearance at the Dispatch Box other than at Question Time. I wish him well.
  The hon. Member for Kingston upon Hull, North (Mr. McNamara) posed some interesting questions. Before dealing with those, I echo what the Minister said about the Falkland Islands. Discipline and courage were shown by our forces during the campaign. The hon. Member for Kingston upon Hull, North made an interesting point about parliamentary control of the armed forces. That is of historic interest and practical importance. It is paramount in Britain that the armed forces come under the control of Parliament.
  We used to have debates such as this every year, but once every five years is adequate. If one reads the small print, it can be seen that this is a narrow debate and one must be careful not to overstep its boundaries. The hon. Gentleman made an interesting point about youth training and the discipline to which 16-year-olds are subject. Only

  1077
  the Minister can answer that. As I understand it, when they join the forces they will be in the same position as a bandsman or anybody else and the general Act will apply to them in the same way as to anybody else.
  I am not prepared to enlarge on the subject of the death penalty. I expect that the Minister will explain the position.
  I have not had much experience of courts-martial and defence but I have been on a court-martial. In many cases it might be an advantage for the accused to have a civilian to defend him who has some knowledge of law rather than someone from the Judge Advocate General's department. The accused should choose whom he elects to defend him.
  I want to refer the Minister to a matter which was raised at c. 470 of Hansard on 13 May, which affects my constituency. I thank the Government for their undertaking to rebuild Victoria barracks, which will have an effect on morale and improve what is at the moment an unsatisfactory position. Service men have to come into the constituency in full kit and then assemble in barracks which are not theirs. I welcome the fact that the Government will renew the undertaking that they gave in the previous Parliament to rebuild those barracks.
  I am sure that the Minister will answer the detailed points that have been raised so far and that he will also wish the youth training scheme in the Army every success. That is as far I am allowed to go if I understand correctly the limitations that have been imposed on the scope of the debate.
  8.4 pm
  Dr. Norman A. Godman: I want to ask the Minister three questions. I assure him that I have some knowledge of military discipline as my national service was with the Royal Military Police.
  Mr. Robert Atkins: Get your hair cut!
  Dr. Godman: Despite that intervention, I am sure that any ex-service man in the House would readily acknowledge that the men serving in the Royal Military Police are among the finest, most honourable and fair-minded people in the land.
  My experience is somewhat dated. What is the legal and military status of service men in Cyprus who are facing trial on that island? If sentenced to imprisonment for a year or more, will British service men serve that sentence in a British prison? In those circumstances, can a Scottish soldier be transferred to a Scottish prison?
  8.5 pm
  Sir Antony Buck: I thank the hon. Member for Kingston upon Hull, North (Mr. McNamara) for his remarks about the Falkland Islands. He and I were out there together and we had a most worthwhile visit. We admired the discipline of the forces there and the way in which they are conducting themselves. In the improbable event of there needing to be a court-martial of a service man in the Falklands, what arrangements are to be made? Will he be flown back, or will smaller disciplinary breaches be dealt with on the spot?
  One of those who looked after our group on the Falkland Islands was Major Tony Figg, the provost Marshal. I am sure that my hon. Friend the Minister will join me in thanking him and all those concerned with
  1078
  discipline in the Falkland Islands for the way in which we were looked after and for the way in which they are co-operating with the Falkland Islanders to ensure that the good relationship between our forces there and the Kelpers —they do not resent being known as that but they do resent being known as "Bennies"—is maintained. That is largely due to the work of those who are in charge of discipline.
  I congratulate my hon. Friend the Minister on his appearance at the Dispatch Box. I am sure that he will be happy in his job and we wish him the best of good fortune in it. He is lucky to have the job and the services are lucky to have him, so all should be satisfied.
  I shall be grateful if my hon. Friend will say a word about how disciplinary matters should be dealt with on the Falkland Islands. It appears that they will, rightly, be based there for a considerable period with a fortress Falklands policy. I would like to know about the on-going — to use that terrible jargon — position regarding discipline there.
  There is in my constituency the military corrective training centre and I am on its board of visitors. I pay it frequent visits and it is a superbly well-conducted establishment. The staff there have two advantages. First, there is a high staff to soldier-under-sentence ratio, which is good. In addition, all the people there are young, which is a substantial benefit compared with a civilian establishment where there is a mixture of young and old.
  Mr. Robert Atkins: As one who served on the Select Committee that covered these topics, and who paid a visit to Colchester's corrective prison to see exactly what went on, may I encourage my hon. and learned Friend to continue to praise the standards operating there? The prison not only incarcerates people, but tries first to return those involved to military quarters. It also understands that those who cannot return easily to military discipline should try to get some sort of job outside.
  Sir Antony Buck: I am obliged to my hon. Friend. He has told me before of the visit that he made to the MCTC at Colchester. I am glad that he shares my admiration for the work done there. I hope that that work can be improved in future, as the military corrective training centre is now being rebuilt. Frankly, that is not before time. I have been a Member of Parliament for more than 20 years and have been pressing for that. To maintain Army discipline a military corrective training centre should not be housed in clapped-out Nissen huts as at present, but in new buildings.
  In the long term, it is extremely wasteful to operate in such conditions. The fuel bill is enormous and it is more difficult to deal appropriately with soldiers under sentence if the conditions are somewhat primitive. I was delighted to visit recently the site of the MCTC and to see the foundations of the rebuild. However, it is not for me to delay the House for any time on such an issue. I merely reiterate that we very much admire the work done by the brave people in the Falkland Islands. I am grateful to my hon. Friend the Member for Ribble, South (Mr. Atkins) for the tribute that he has paid to the work done by the military corrective training centre in Colchester.
  Do the Government intend to continue the procedure of having a short annual debate on this subject? At some stage there was talk of not having this annual debate. Is my hon. Friend the Minister considering any alteration, or

  1079
  will there be a short debate annually? Although we are discussing something of a routine matter, it is useful to hold a debate, albeit short, on this subject. It may well be that matters will suddenly arise, and that it is more appropriate to raise them in a debate such as this, than, for example, in the two-day debate on the White Paper to be held next week.
  I renew my congratulations to my hon. Friend the Minister. I am sure that he will be very happy in his new job. I wish him well in it, and look forward to his reply to this short debate.
  Mr. Stanley: With the permission of the House, I shall speak again.
  I thank the hon. Member for Kingston upon Hull, North (Mr. McNamara) for his kind words of welcome. I cannot promise that the unanimity displayed in this short debate will always attend our defence debates, but I was grateful to him for what he said. I also thank my hon. Friend the Member for Windsor and Maidenhead (Dr. Glyn) and my hon. and learned Friend the Member for Colchester, North (Sir A. Buck) for their kind words of welcome.
  The hon. Member for Kingston upon Hull, North referred to a considerable number of provisions in the report of the Select Committee that examined the Bill in 1981. I shall deal with as many of them as I can, but if some points remain outstanding and the hon. Gentleman requires further help I shall gladly assist and will write to him. The hon. Gentleman mentioned the treatment of young service offenders and the Select Committee's recommendation about making social inquiry reports on them available to courts-martial. I assure him that, in view of the Committee's concern, the possibility of introducing a system of inquiry reports is being examined in the Department. It remains our view that a great deal of information is available to courts-martial from within the services. However, we should like to assure the Select Committee that considers the next five-year Bill that adequate safeguards exist and that we shall continue to look at the recommendation made last time by the Select Committee.
  Obviously the Government will take note of the view that the House expressed last night on capital punishment. Quite separate considerations, in our view—and in that of the House until now—have applied to discipline in the armed services. The hon. Gentleman will be aware that when the Select Committee examined that subject in 1981 it was its unanimous view that capital punishment should be retained for the offences laid down in the legislation. I am, of course, aware of the Committee's recommendation about definitions, and the Government will examine that before coming forward with the 1986 Bill. However, the view that we have taken until now—and I cannot anticipate any change—is that special factors apply to service discipline which warrant the retention of capital punishment.
  The hon. Gentleman referred to alcoholism. The services are certainly very much aware of that. However, all three services take steps to discourage excessive drinking and officers are trained to recognise the signs of alcohol abuse. I am assured that, should problem drinking come to light, appropriate disciplinary measures are taken. Thus, there is no complacency about that. From time to time, of course, press reports highlight instances of drunkenness, but I am advised that it is wrong to say that the problem is more serious in the armed forces than in the
  1080
  community at large. Indeed, I stress that there is apparently no greater proportion of drunkards among our service men than among the community at large.
  The hon. Gentleman also referred to the treatment of service men in Star and Garter homes. That issue has not been raised with me before. It may be a matter of charitable status and, if so, I shall certainly consult my right hon. and learned Friend the Attorney-General about it. If I can help the hon. Gentleman further, I shall gladly do so. He also raised the important point of the extension of the youth training scheme to cover the armed services. The House will be aware that a few days ago we laid the necessary regulations to enable the armed services to make a direct contribution to the youth training scheme. We certainly believe that that measure is both valuable and helpful to those young people who are unemployed, as they will be able to benefit from service life and training. It will also help them if they wish to obtain jobs in civilian life afterwards, or if they wish to stay in the services permanently.
  The hon. Gentleman asked about the form of discipline facing those under the age of 17. I understand chat those who join the armed services' youth training scheme will be subject to exactly the same discipline of those of the same age who are going permanently into the forces. Therefore, I think the correct analogy is with the young soldiers. However, I shall advise the hon. Gentleman if that is wrong.
  My hon. Friend the Member for Windsor and Maidenhead referred to the Victoria barracks, a major issue in his constituency. I confirm that the reply that my predecessor gave to him on 12 May in a written answer stands. I hope that we shall be able to make progress with that rebuilding programme in the time scale mentioned in the answer.
  The hon. Member for Greenock and Port Glasgow (Dr. Godman) asked me three precise questions about soldiers in Cyprus. I understand that a soldier serving in Cyprus is subject to the provisions of the Army Act 1955 in the same way as a soldier serving anywhere else in the world. If he is given a prison sentence, he will probably be returned to the United Kingdom to serve that sentence.
  I am advised that a Scottish soldier would not be dealt with differently from any other British soldier in relation to the prison to which he is remanded. I am not sure whether there is any propensity for putting Scottish soldiers in Scottish remand centres or prisons. I doubt whether there is. A Scottish soldier is treated in the same way as any other British soldier in terms of the prison in which he serves his sentence.
  My hon. and learned Friend the Member for Colchester, North asked about soldiers disciplined in the Falklands. The normal disciplinary procedures apply. If a case can be dealt with locally, in situ, it will be dealt with in the Falklands; if it cannot, it will be dealt with in the United Kingdom.
  I assure my hon. and learned Friend that the Government have no plans to alter the present arrangements under which we debate the order annually.
  From the correspondence that I have received in the past few weeks, it is clear that many constituents are interested in disciplinary matters and therefore many hon. Members will be concerned at a constituency level. It is helpful to have such debates each year so that hon. Members can express views to Ministers.
  Question put and agreed to.
  Resolved,
  That the draft Army, Air Force and Naval Discipline Acts (Continuation) Order 1983, which was laid before this House on 29 June, be approved.

  Northern Ireland (Criminal Attempts and Conspiracy)
  8.23 pm
  The Under-Secretary of State for Northern Ireland (Mr. Nicholas Scott): I beg to move,
  That the draft Criminal Attempts and Conspiracy (Northern Ireland) Order 1983, which was laid before this House on 3rd May, in the last Session of Parliament, be approved.
  The order is designed to bring three aspects of the criminal law in Northern Ireland into line with changes already made in England and Wales. First, it creates and defines a statutory offence of attempt. Secondly, it abolishes in Northern Ireland the offence of loitering with intent, often known as the sus law, and creates instead a new offence of vehicle interference. Thirdly, it creates a new statutory offence of conspiracy.
  The provisions of part II of the order relating to criminal attempts correspond to those introduced in England and Wales by the Criminal Attempts Act 1981.
  Part III of the order, repealing the offence of loitering with intent, also corresponds with provisions of that Act. That act introduced a new offence of vehicle interference to fill a gap which would have been left by the repeal of the sus law in England and Wales. The order makes similar changes for Northern Ireland.
  Part IV, the third substantive part of the order, relates to criminal conspiracy. The Criminal Law Act 1977 defined the ambit and essential elements of the offence of conspiracy and the related penalties in England and Wales. Subsequently, the Criminal Attempts Act 1981 provided that the offence of conspiracy, like that of attempt, can be committed even where the intended substantive offence is impossible in the circumstances. Part IV of the order applies these provisions to Northern Ireland.
  Those are the three areas of reform dealt with in the order. I should now like to explain the main effects of the individual articles. Articles 1 and 2 are mainly formal. The order, if approved, would come into force two months from the day of its making. Articles 3 to 6 are concerned with the law of attempt. Article 3 defines the mental element and the conduct necessary to constitute an attempt to commit an offence. The mental element required is an intent to commit an offence.
  The article therefore provides that a person may be guilty of attempt even where the attempted offence was inherently impossible. What matters in this situation is the intent, and that is determined by what the person believed to be the facts. The conduct, which is the other essential ingredient for attempt, must be something more than an act which is preparatory to the commission of the offence. This broadly repeats the present situation in common law.
  Article 3 applies to an attempt to commit any offence which, if completed, would be triable in Northern Ireland, with the exception of offences such as aiding and abetting where an attempt would be at a double remove —therefore remote—from a substantive crime.
  Article 4 provides that where special rules, such as time limits, apply to the substantive offence, they will apply also to attempts to commit that offence.
  Article 5 provides that, in general, the mode of trial and the maximum penalty for an attempt will be same as that for the substantive offence, except for certain offences which statutorily carry a lower maximum penalty.

  1083
  Under article 6 the common law offences of attempt and of procuring materials for crime are abolished. This article also ensures that the jurisdiction conferred on Northern Ireland courts by the Criminal Jurisdiction Act 1975 to try attempts to commit certain serious offences, where those attempts took place in the Irish Republic, is unaffected by the provisions of this order.
  Part III deals with suspected persons. Article 7 repeals the suspected person offence in section 4(k) of the Vagrancy Act 1824. That provision relates to suspected persons or reputed thieves frequenting or loitering about certain places with intent to commit arrestable offences.
  While there have been very few prosecutions under this provision in recent years in Northern Ireland, the Government accept that the offence should be repealed there as it was in England and Wales. However, we propose, as in England and Wales, to introduce a new offence of vehicle interference. A person would commit this offence under article 8 if he interfered with a motor vehicle or trailer with the intention that he or someone else should commit any of the following offences: theft of the vehicle or trailer; theft of anything carried in or on it; or taking or driving away without consent. The offence would be triable summarily with maximum penalties of three months' imprisonment or a fine of £500 or both. Under article 8, a police constable whould have power to arrest, without warrant, anyone who is, or whom he reasonably suspects to be, guilty of the offence.
  Part IV of the order, which contains articles 9 to 13, is concerned with the law of criminal conspiracy. Article 9 creates a new statutory offence of conspiracy. It replaces the existing common law offence usually regarded as any agreement to effect any unlawful purpose. The new provision defines conspiracy more precisely as an agreement with at least one other person to pursue a course of conduct that will amount to or involve the commission of a criminal offence. This change is based on the recommendations of the Law Commission, which found general support for the proposition that it should not be a crime for two or more persons to agree to do something which it would not be a crime for one of them to do. The article provides also for "impossible" conspiracies, in much the same way as article 3 covered "impossible" attempts. Additionally, it says that there is no conspiracy unless the person concerned and at least one other knew that any relevant circumstances would exist at the material time. Article 9 applies to any offence triable in Northern Ireland and, exceptionally, to murder wherever committed.
  Article 10 sets out exemptions from conspiracy, such as agreements with an intended victim or between husband and wife.
  Article 11 provides that the penalty for the new statutory offence of conspiracy, where it relates to offences punishable with imprisonment, would be limited to the maximum term available for that offence or the most serious of two or more offences. As for fines, there would be no limit on the fine for conspiracy to commit an offence triable on indictment, but the maximum fine for conspiracy on summary conviction would be the same as for the substantive offence.
  Under article 12, proceedings for conspiracy to commit a summary offence could be instituted only with the consent of the Director of Public Prosecutions for Northern Ireland. Where the consent of the Director of Public Prosecutions or the Attorney-General would be required
  1084
  for proceedings for the substantive offence, or where specified time limits apply, the same requirements would apply to proceedings for conspiracy.
  Article 13 is concerned with consequential abolitions, savings and transitional matters. It abolishes the common law offence of conspiracy except in so far as it relates to conspiracy to defraud and conspiracy to corrupt public morals and outrage public decency. It abolishes also the offence of incitement to commit the offence of conspiracy. The article provides that the acquittal of one parry to a charge of conspiracy would no longer necessarily entail the acquittal of others. It also preserves the jurisdiction conferred on Northern Ireland courts by section 6 of the Criminal Jurisdiction Act 1975 to try cases of conspiracy to commit certain serious offences even though the conspiracy was formed in the Republic of Ireland. Those are the main provisions of the order.
  Part V, consisting of article 14, is concerned solely with technical repeals consequential upon the introduction of the new offences and the repeal of "sus". They are set out in the schedule.
  When the draft order was published as a proposal in Northern Ireland, its reception reflected a general welcome for a measure aimed at keeping the law in Northern Ireland up to date. Against that background, I commend the order to the House.
  8.29 pm
  Mr. Clive Soley: I do not intend to keep the House long, but it is interesting to note that, had we been discussing the original Act, we would have had a major debate. That says something about the position in Northern Ireland which is different from here.
  As I understand it, there have been only about 17 prosecutions and 13 convictions in Northern Ireland since early in the 1970s under section 4 of the Vagrancy Act 1824, a section which aroused a great deal of feeling in the House and the country. It is not a major issue. That says something about the nature of the cultural, social, economic and political problems in Northern Ireland compared with those of the rest of the United Kingdom.
  I do not know whether the Minister has a view on this —he may not have the information to enable him to form a view — but I should like to know whether he thinks that the previous Act and the new one would be more widely used if it were not for the existence of the Northern Ireland (Emergency Provisions) Act. I suspect that they would be.
  I have always had serious reservations about conspiracy charges. It is difficult to justify a conspiracy charge when no act has been committed. One has to decide whether two or more people have sat down and decided intelligently, thoughtfully and intentionally to carry out an action which in certain circumstances — albeit rather rare — could result in a life sentence, because if it were a conspiracy to commit murder, it could end in that way. I am not entirely happy with the conspiracy charge, but I accept that there have been arguments about it on a number of occasions in the House and elsewhere, and that argument certainly cannot be resolved during a debate on this order tonight.
  I suspect that I might be more worried about the offence of interfering with vehicles if the position in Northern Ireland were as it is here. The old Act required two separate actions before a police officer could arrest a person. The new Act requires only one. The problem with that is that if a young person has been crouching down by

  1085
  a car, looking through the window and, perhaps, putting his hand on the car door handle, he could be guilty of an offence. Under the old Act another action would have been necessary—perhaps looking as if he were trying to slide the window down or something like that. Neither of those Acts is satisfactory in this country, but given the number of prosecutions in Northern Ireland, frankly it would be irrelevant, if I chose to make an issue of it. We might want to consider the point again if, in more normal times in Northern Ireland, this became a problem in the way that it did here.
  I add a cautionary note, perhaps only to put it on the record, that to have such an offence triable summarily only and not by jury puts the person much more at risk because it places a great deal of weight on the police officer's evidence and little on that of the individual. One almost has to prove one's innocence rather than having one's guilt proved.
  The Opposition will not oppose the order, and I expect that it will be accepted in Northern Ireland largely without comment.
  8.33 pm
  Mr. J. Enoch Powell: I can relieve the Minister's mind at once, if he is anticipating that on this occasion the motion might be opposed by myself or my hon. Friends. However, I immediately add that that immunity should not be held to extend to future commissions of the same offence. When I say "offence", I am referring not to the offences that constitute the title of the order, but to the offence that is offered to Northern Ireland and its people by the continuation of direct rule —of which the passing of the order before the House is yet another example. The Minister must not take it amiss if, briefly, I dilate upon the implications and the reasons why exception is justly taken to this form of procedure by my hon. Friends and myself and by those whom we represent.
  If the procedure continues, in accordance with the undertaking that we gave to our electors at the general election to do our best to put an end to direct rule in the compass of this present Parliament, we shall need to mark our displeasure by obliging the Government, if they decide to do so, to resist a vote against the motion.
  As the Minister has explained, the effect of the order is to apply to Northern Ireland the changes in the law of England and Wales that were made by the Criminal Attempts Act 1981, including changes that went back to the Criminal Law Act 1977. I and my hon. Friends and the Ulster Unionist party believe that where there is no clear reason to the contrary there should be uniformity of law in Northern Ireland with the law in England and Wales. Although the hon. Member for Hammersmith (Mr. Soley) pointed out some differences in the background in Northern Ireland and in England and Wales, he did not go so far as to say that he would regard this as an instance where there was justification in those differences for having different law in those respects in the two parts of the kingdom.
  In believing that there should be uniformity of law, we find ourselves in a difficulty. The law with which the law of Northern Ireland is to be brought into conformity by the order is a law that was in effect made without our participation. Upon the face of it, the 1981 legislation did
  1086
  not apply to Northern Ireland. Northern Ireland and its representatives were, therefore, not brought into the processes of debate and consideration that resulted in the placing of that Act upon the statute book.
  We were not involved in the legislation, not because there was any doubt that it would sooner or later be applied in Northern Ireland, but because of the determination to maintain one of the consequences of the annually renewed direct rule, that being that Northern Ireland can be legislated for by Order in Council. Therefore, instead of including Northern Ireland in the 1981 legislation so that we would have participated on an even footing with all other hon. Members of Parliament in that legislative Act, Northern Ireland was excluded from that Bill.
  There is a procedure whereby an England and Wales Bill can include a clause that enables it to be applied, subject to negative procedure, to Northern Ireland with the necessary mutatis mutandis. Even if such a clause had been included in the 1981 legislation, it would have been plain upon the face of it that that was legislation intended to apply to Northern Ireland and, consequently, we would have had equal rights and equal expectation that we would participate in the legislation that was to be applied to our own constituencies and constituents.
  There is no excuse now, whatever might have been the case in the past, for this procedure. With the extension of the representation of Northern Ireland, there are now at least 12 working Members of Parliament for Northern Ireland in the House fully able and ready to cover the whole range of subjects which come before Parliament and to apply themselves to the legislation which is to extend to their own constituencies no less than to the other constituencies of the United Kingdom. The Government cannot argue that, as the law in Northern Ireland on these subjects may hitherto have been different from that in England and Wales, the application clauses would be complicated. I have never believed this excuse in any case because the draftsmen in other circumstances show themselves perfectly capable of whatever complexities need to be brought into a schedule to a United Kingdom Bill in order to make it applicable to Scotland or, if necessary, to Northern Ireland. Nor have my hon. Friends and I ever accepted the proposition that there should be "immortal, invisible" what is called a Northern Ireland statute book to which additions are not simply made by this House by ordinary legislation but to which additions will be made only by the process of Order in Council.
  We have never accepted that in principle because we have never believed that there is such a thing as a Northern Ireland statute book, as the law in Northern Ireland dates from a whole series of legislative sources only one of which is the legislation carried out in Northern Ireland by the former Parliament of Northern Ireland and by the subsequent brief and ill-fated Northern Ireland Assembly of 1973–74. If there ever was any excuse, which we do not admit, on grounds of maintaining sacrosanct a Northern Ireland statute book, it does not apply here, for we are dealing—we are specifically told so in the note on the order — with the criminal law, which is a reserved matter. In any case, the statute book that we are supposed to keep on transferred matters so that we can hand it over to the new, quasi-anticipatory federal institution in Northern Ireland would not include legislation of this sort.
  In short, there was no justification in 1981, and there will be no justification in similar cases in the future, for excluding representatives of Northern Ireland from full

  1087
  participation in the legislative processes of this House when law is being made which will be applied to Northern Ireland. If repetition of that procedure continues, we shall not rest content as we have done hitherto with simply putting the matter on record in debates such as this.
  We should be able — the hon. Member for Hammersmith substantially agreed with us — to make our voice heard where the law of the United Kingdom is being made. Where the law in Northern Ireland has hitherto been different or is to remain different, we should be able to discuss with our peers in the House whether that is justified. I noticed, although the Minister did not emphasise it in introducing the order, that in Northern Ireland, unlike England and Wales, attempts to commit a summary offence have themselves been since 1953 a summary offence. It is not proposed to alter that. So, in that respect, the Criminal Attempts Act 1981 combined with this order will still leave a difference between the law in Northern Ireland and the law of England and Wales.
  There should have been arguments—I am sure that I shall carry the hon. Member for Hammersmith with me on this—as to whether that offence is justifiable any longer in Northern Ireland or, if it is justifiable any longer in Northern Ireland, why it is not requisite in the rest of the United Kingdom. There may be reasons for that, but it should have been possible to test those reasons by the common legislative methods, in Committee, on Report and in debate across the House, in the same way as they are tested in other contexts.
  Mr. Soley: I would argue strongly that this House has the right and duty to debate any legislation that affects Northern Ireland. What we choose to apply to Northern Ireland, however, is a matter of choice for this House as well. Similarly, I would see a rather different solution from the right hon. Gentleman because in an all-Ireland solution I should be thinking in very different terms. Up to that point we are on similar lines.
  Mr. Powell: I do want to intrude or stray into the world of the imagination which the hon. Member for Hammersmith (Mr. Soley) inhabits, but we were substantially on the same point.
  I do not dispute that the extent of an Act of this Parliament is a matter for this Parliament but, then, I do not imagine that anyone doubted when we were passing the 1981 Act—in any case, we should have known and been told it at the time—that it was legislation which would be, and was deemed to be, requisite and applicable in Northern Ireland.
  We also agree, if I understood the hon. Gentleman aright, that if differences are to remain—and there is this difference to remain in respect of summary offences —that should also be decided by this House after due debate.
  Nobody could possibly seek to assert that we can test these matters properly by debating an Order in Council because, apart from the well-known fact that such a debate imports none of the normal processes of legislation, we find ourselves already committed by what has been placed on the statute book in a past year.
  I am glad therefore that, to the extent that it does not impinge on his dream world of the future, the representative of the official Opposition, the hon. Member for Hammersmith, is in line with my hon. Friends and me in resenting procedure by Order in Council for applying
  1088
  to Northern Ireland law which has been made for England and Wales in the knowledge that it would in due course be applied to Northern Ireland.
  I hope that the Government will not be deceived by the relatively easy passage of the order tonight and that they will not proceed gaily on their former course but will understand that they are now confronted with a representation of the people of Northern Ireland which is determined no longer to live under a form of quasi-colonial rule but which, being sent to this House to take a full part in the procedures, powers and rights of this House, is determined to exercise those in all matters which can affect the Province which they represent.
  I invite the Minister to convey that message not only to those corridors of power in which there are doors behind which the legislative draftsmen work, but that he will also convey it in quarters in which more distinctly political decisions for the future are taken. It is not the wish of hon. Members on this Bench to be a source of unnecessary inconvenience to the House, but I fear that if the warning that I have uttered tonight is not heeded that will prove to be the case, and that is a message which the representative of the Patronage Secretary — the hon. Member for Calder Valley (Mr. Thompson) — might also usefully convey to his master.
  8.49 pm
  Mr. Scott: I hope that the hon. Member for Hammersmith (Mr. Soley) will forgive me if I deal first with the points raised by the right hon. Member for Down, South (Mr. Powell) because he raised issues which go much wider than the precise contents of the order. I am sure that my ministerial colleagues will have noted the grave warning issued by the right hon. Gentleman and will bear it in mind as we consider these matters in future. We are all anxious, perhaps direct-rule Ministers as much as others, to see an end to direct rule as soon as we can find an alternative method of government for Northern Ireland that is acceptable across the Northern Irish community. If that can be achieved within the provisions of the 1982 legislation, the machinery is available to lead us to the restoration of devolved government for Northern Ireland. We are only too anxious to see that machinery operate. The right hon. Gentleman knows as well as I do that if that is to be achieved it is essential for widespread cross-community support to be in evidence.
  Mr. J. Enoch Powell: Has the Minister reason to suppose that legislation, passed in the House by the due processes, which applies to Northern Ireland as well as to the rest of the United Kingdom, is not acceptable to all sections of the community in Northern Ireland? If he has such reason, why do the Government persist in so legislating?
  Mr. Scott: It is the view of Her Majesty's Government that the way forward beyond direct rule for Northern Ireland is a return to devolved government on the basis of widespread cross-community support. We have said that often enough, and my right hon. Friend the Secretary of State reiterated it before the Assembly only a few days ago. We look forward to the day when that may be brought about.
  The right hon. Gentleman addressed himself to whether the order should have been encompassed within the 1981 legislation. It was felt that both the 1977 legislation and

  1089
  the 1981 legislation needed to be examined in some depth and at some length to ascertain how appropriate it was to the needs of the Province. That was one reason, but by no means the sole reason, why it was decided not to incorporate Northern Ireland within the terms of that legislation. As Bill after Bill comes forward, consideration is given to whether it should be extended to Northern Ireland or whether equivalent legislation should be adjusted as appropriate to the needs of Northern Ireland, to be introduced by Order in Council. Pending the return to devolved government, it is important to preserve the integrity of a Northern Ireland body of law.
  Mr. J. Enoch Powell: The Minister evidently inhabits the same dream world as the hon. Member for Hammersmith (Mr. Soley). When legislation is being prepared, why do the Government deliberately refrain from considering whether it should apply to a part of the United Kingdom until they have enacted it for England and Wales? What possible justification can there be for separating the two processes in this way unless the intention is, quite deliberately, to maintain for political purposes — they cannot include the purpose of maintaining the Union—a distinction and a difference between Northern Ireland and the rest of the United Kingdom?
  Mr. Scott: I am back on familiar ground with the right hon. Gentleman. He seems basically to consider every act of Her Majesty's Government to be some form of conspiracy against the Union of Northern Ireland within the United Kingdom. The Province had 50 years of devolved government and we hope that it will return to devolved government. We believe that the integrity of its body of law should be maintained. As the right hon. Gentleman has said, this is a reserved matter. Although it is envisaged that transferred matters should first be
  1090
  returned to any devolved Administration which emerges in the Province, reserved matters could also become its responsibility.
  The hon. Member for Hammersmith will recognise that the emergency provisions in the prevention of terrorism legislation apply only to terrorist offences. The extent to which that legislation impinges on others is a matter of judgment. However, the rights of constables are restricted to being able to arrest those whom they suspect of terrorist offences.
  I note the reservations of the hon. Member for Hammersmith about conspiracy. It is a step in the right direction to introduce in a new statutory form what was widely regarded as an unsatisfactory common law provision on conspiracy. Whatever residual doubts the hon. Gentleman may have about conspiracy, I hope that he will accept that that is a step in the right direction. Putting the provision on a proper statutory basis rather than leaving it under common law is a step in the right direction.
  The hon. Gentleman referred to vehicle interference. That problem does not loom large in Northern Ireland, as the hon. Gentleman rightly said. The courts on this side of the water have not been in the habit, since the law was changed, of taking simply looking into a car and putting one's hand on the door handle as evidence of an attempt to interfere with the vehicle with the intention of taking it away or stealing something in it. There has to be positive interference with the vehicle with the intention to do one of the three things that I outlined in my speech. The courts see that as a more restrictive provision than the hon. Gentleman suggested in his remarks.
  We have heard that the order will not be opposed. I commend it to the House.
  Question put and agreed to.
  Resolved,
  That the draft Criminal Attempts and Conspiracy (Northern Ireland) Order 1983, which was laid before this House on 3rd May, in the last Session of Parliament, be approved.

  Hay's Wharf and Thames Riverside
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Donald Thompson.]
  8.55 pm
  Mr. Simon Hughes: The matter before the House concerns nothing less than the life blood of this capital. The subject that I have chosen for debate is Hay's wharf, its future, and that of the Thames riverside.
  I shall first define the area. It stretches from Vauxhall Cross in the west, along the south bank of the river to the north side of the borough of Lambeth, into the borough of Southwark and down to Surrey docks. The area includes, because the two banks are interrelated, the dockland areas in the east end of that stretch on the north side of the river. The areas have become particularly inter-related of late because both come under the control, at least in part, of the London docklands development corporation.
  This stretch of the Thames riverside has recently been the subject of some of the most amazing—I choose my words carefully — decisions in our city's planning history. They began with the consideration that was given to the Vauxhall Cross site. That resulted in a decision, by a new procedure without a proper public inquiry, to have predominantly office development on a site in north Lambeth. Since then, on a sequence of sites, permission has been granted or approved, primarily overseen by successive Secretaries of State for the Environment in this and previous Governments, for millions of square feet of office space, which I would say is not justified by any demand factors of which this House is aware.
  What should be the purpose of the planning of the Thames riverside? The advice given to the Secretary of State by the Royal Institute of British Architects only last year was that planning should seek to attain a balance between development and quality, which
  "will require a deft touch in processing planning applications."
  The one thing that London has not seen of late is a deft touch. It has seen a sledgehammer approach to erect a wall of concrete and glass, which will separate the community of our capital from the riverside that is its home, its employment, its view, its past and its future.
  On St. Valentine's day this year, two weeks before I entered the House, an article appeared in The Times with this headline:
  "Developers may be building a South Bank white elephant".
  It stated:
  "A new generation of property developers is now taking on a gamble at which even their predecessors of the 1973 boom and bust might have quaked.
  A massive 11 million sq ft of office space is now available in the City and central London. Companies like ICI, Esso and Blue Circle are deserting flagship office blocks in droves in search of small headquarters, or moves to the provinces. Yet developers now plan to increase London's estimated 210 million sq ft of office space by an unprecedented 32 million sq ft—three times what the '73 boom produced."
  Many of them have decided that the place to do that—one of the few remaining spaces where it is possible—is—the south bank. The article continues:
  "But the sheer scale of the South Bank project, which could transform chunks of the river frontage … into sparkling ivory towers, has largely escaped public comment."
  I raise this subject on the Adjournment today so that it will no longer escape public comment. The House should have a reply to the question posed in that article. The South Bank cries out for development, but is 7 million sq ft of
  1092
  office accomodation too much for London and its community to swallow? The answer to that is an unequivocal yes. The communities south of the river are about to be trampled upon and the plans are, without doubt, too much for them to be asked to swallow. Indeed, there is a growing feeling even among the developers that the office space will not be occupied, and the statistics point away from any likelihood that the developers will be able properly to use the sites.
  I take a catalogue of sites to identify the enormity of the problem. I start at Vauxhall bridge with Vauxhall Cross, and then proceed by way of a range of sites, 14 of which are in my constituency of Southwark and Bermondsey. The first is Coin street, straddling the border between Lambeth and Southwark, where applications have been made and inquiries held but no development has taken place. Applications have been made proposing 92,000 and 82,000 sq ft of office space respectively and there is now a legal dispute about the site.
  One then proceeds to King's Reach, a development in which a hotel site was sold and the shell completed in 1976. The hotel company then went into liquidation. The shell was put up for sale and in 1978 an offer to purchase was made. Permission was granted for offices to be put in part of what had been intended as the hotel, but planning permission was refused for offices to be put into the rest of the hotel, so it has remained almost entirely empty. There it stands, neither hotel nor occupied offices. All that remains is the regular overhead passage of helicopters at 7 am on Sundays and at 8 am and 9 am on most weekdays. Even now, there are people living there—a pocket of people underneath, with empty office blocks, an empty hotel and the noise of the helicopters as their surrounding environment.
  Next comes a vacant site on the edge of Blackfriars road, where no work has started. There is then the empty Bankside power station. If it is demolished, the site could be put to community use, but there is a risk that the Central Electricity Generating Board may wish to sell it too, to developers for office use.
  Next comes east Bankside, which is a site of historic importance. It is where the Globe theatre used to be. It is near other sites of historic community importance, in a borough that has existed as such and been represented here since 1295. Southwark is the borough of Chaucer and, later, of Shakespeare and Dickens. It was the borough of London's entertainment, life and, later, wealth. Even the east Bankside development which, in many ways, is the most acceptable and desirable, includes office space.
  On Southwark bridge road there are vacant buildings and office space is planned. European Ferries in Bankside has now begun demolishing the St. Mary Overy dock. It is a historic dock, by the side of Southwark cathedral. European Ferries is demolishing some of the most historic, interesting and beautiful back streets in our heritage to create a tourist attraction and a great deal of office space. That is not entirely to be rejected and despised but the plans do not preserve the character and quality or enhance the great potential of that site.
  Next comes Courage's in Park street. That brewery has been part of south London's brewing tradition for more than 200 years. The site is now empty because Courage has moved away for various reasons, one being the lack of infrastructure to enable it to continue on that site. The company also suffered from the site having a high rateable value and high rates. There was also the inability to expand

  1093
  to provide local employment because it was not able to take over other sites. Fortunately, the site has been taken over. If the takeover and the plans are successfully implemented, we shall have housing and light industrial use on that site.
  The sites continue past smaller wharves until we reach Hay's wharf, which has triggered this debate. It is an extremely important site, from London bridge to Tower bridge. It has lain almost derelict for years. It was the subject of a planning inquiry two years ago which dealt with an application for more than 2 million square feet of office space. The inspector recommended, and then the Secretary of State approved, 750,000 sq ft of office space. Last week, without another public inquiry, plans and proposals advanced by the LDDC, which had not been revealed to local people were approved by ministerial order. Under the Local Government, Planning and Land Act 1980 the House approved planning by special development order.
  The Secretary of State sits in his office on this side of the river. He is a member of a party that has no support, bar a few incidental voters, in any of the places that we are dealing with. He belongs to a party that has been rejected time after time by the people and the communities that we are discussing. He gave his approval, so that planning permission for a scheme was thereby automatically granted. Hay's wharf is a private site and suddenly, about two weeks after taking office, the Secretary of State granted permission for 2·25 million sq ft of office space on the Hay's wharf site. That is 10 times the space that has been allowed for any other use. There will be minimal retail use and less than 400 homes, although other amenities are to be built into it. The plan worries even the Tower of London authorities across the river because it will spoil the view across the Thames. The people who just happen to live in Tooley street and the people who just happen to have been brought up in north Southwark have had no proper chance to say whether the plans are the type of development that they want.
  Then we move down the river, past the place where tradition has it that Bill Sykes killed himself. The land at Surrey docks was taken by the docklands corporation by an order passed in the House, without anyone knowing the plans. As I predicted in a speech in the House in March, the original plans were discarded by the corporation, which has adopted others. Even on the corner of the Rotherhithe tunnel a small site put up for public competition will have offices built on it. It is a tragedy that, one by one, the remaining pieces of land on the south bank are being developed in this way. I was brought up to believe that land belonged to the people, and that the people should use it for pleasure and to gain employment and resources. However, the prospect facing many of those people is not one of the river, by the side of which they were brought up, but of office blocks beside the river separating the community from it.
  It is increasingly accepted that wholesale redevelopment is a destructive, not productive, force in regenerating inner city communities. This community is crying out for shops, small-scale housing and workshops. At lunchtime today I talked to representatives of the private firms along the riverside who have an interest in this part of the river. They said that there was no shortage of demand for their work, but that they need some help. They wish to ensure
  1094
  that they are not penalised by high rates or by other restrictive practices. They know that there is a demand, and that if they cannot respond to it, trade will go to other ports in Britain or to ports such as Rotterdam and Antwerp. Then we would be left with schemes that will result in office blocks being erected quickly, but without any guarantee that they can be let. One of the especially harmful effects of the order, and of the planning procedures now being implemented, is that there is no time limit on the building of those blocks. With normal planning requirements local authorities may impose a time limit, but the plans for this development could lie on file for 15 or 20 years and no one could challenge the development of the sites. That is completely different from previous planning practice.
  That is one result of the special development order procedure, which is not designed to allow private gain but is designed for non-controversial matters, such as service stations on motorways or other garages. However, that procedure has been used twice in relation to Thameside development, and, it is threatened, will be used again to ensure that there is no consultation for mammoth development schemes that are completely inappropriate to the area around them.
  Southwark borough council tells me that small units of less than 1,000 sq ft are now being sought, successfully developed and let. There is demand, which is reflected by the greater London strategic plan and by the local authorities' proposals for the area. They are draft proposals in a draft north Southwark district plan. I do not agree with all of them, but at least they reflect the views of the local authority and, in large part, the aspirations of the local people.
  What do the people want? They do not have difficult or complicated demands. To start with, they want homes. Some 2,000 out of the 8,000 people on the waiting list for homes in Southwark borough want to live in Bermondsey and Rotherhithe, but there are not the homes for them to live in. They also want to bring up their families with open spaces outside their homes so that the children can be brought up in a healthy environment and at the moment the possibilities of that are receding with every decision made by the Secretary of State.
  The exploitation of the land by property companies, however commercially justified they may see their development as being, will result in increased land values. That is harmful both for any public authority that wishes to develop the land and for any private occupier, tenant or owner who wishes to live there. It will be reflected in increased rates, rents and prices. Local demands are not being met and the tragedy is that with every one of these clearly and irrefutably undemocratic decisions, the whole logic of the way planning legislation has been allowed to develop in the way that it has is being, almost without notice, avoided and ignored by the Government.
  It is fundamentally wrong to say, as the Secretary of State did last week in his decision about Hay's wharf, that supply and demand for offices is essentially a matter to be determined by the market. It is wrong, as the Secretary of State for the same Department said in 1975 on the Greater London plan, before approving it, because if market forces are left to operate unchecked, much of London's housing land will be transferred to other uses. If one Secretary of State, when approving one plan, says that market forces are not the way to allow this priceless heart of our national, local and community heritage to be developed, it must be

  1095
  wrong that another Secretary of State, some eight years later, should say that market forces should be the determining factor. It is clear that the market forces will not necessarily produce the goods, even for those competing for the market.
  I spoke at the beginning about a white elephant. Increasingly, my fear is that with these decisions the Secretary of State has sent a white elephant to trample around the south bank. The footprints of that white elephant are increasingly seen to be leaving their mark in a way that risks the survival of the communities which should be there in their place. I make this plea on behalf of one of London's most courageous, most determined, most colourful and most hard-working communities—let the people be allowed to stay where they want to stay, in the sort of community that they want to be and not be driven out and separated from the lifeblood that is theirs and our capital's.
  9.19 pm
  Ms. Harriet Harman: I understand that as the motion on the Adjournment is in the name of the hon. Member for Southwark and Bermondsey (Mr. Hughes) I have to restrict my comments to three minutes. This is not a technical, or even a planning matter, but one of the most urgent matters, which is of grave importance to the people who live in Peckham, whom I represent The land that the Minister is about to give over to speculative office development could, if it were used in the public interest, represent help for thousands of families.
  People in Southwark want a decent home. That is what they are entitled to. However, thousands of families live in conditions that are literally intolerable. They live in flats in huge estates and in high rise blocks, and they have no gardens for their children to play in. The Minister would not be prepared to live on the Aylesbury estate, the Gloucester Grove estate or the north Peckham estate. He would not want to bring up his family on one of those estates. However, for the people who live on those estates this land represents a way out. It is their only way out. It means the prospect of houses — and houses with a garden. It means the possibility of streets instead of gruesome walkways. The council is running out of space on which to build. Within three years, it will have no building land left at all, if this order goes ahead.
  If the council were able to acquire and build homes on this land, thousands of families would look forward to their future and not fear for their future. Instead, the Minister has agreed to plans that will mean either that the land is given over to office space or that it may remain empty for up to 12 years. If offices are built, it is virtually certain that they will remain empty, because there is already so much office space in the area.
  The Minister has made it quite clear where his interests lie. They lie with the commercial interests of speculative office developers. In catering for them he resolutely turns his back on the misery of thousands of families who live in Southwark. He should reconsider this order.
  9.21 pm
  The Under-Secretary of State for the Environment (Mr. Neil Macfarlane): The words of the hon. Member for Peckham (Ms. Harman), whom I welcome to this debate for her brief few minutes, will no doubt be read by
  1096
  those politicians of yesteryear who are responsible for many of the conditions which she so graphically illustrated and which now face her constituents.
  This is the first time that I have replied to an Adjournment debate that has been generated by a resurrection of the Lib-Lab pact. I make no criticism of that, although it causes me some amazement. None the less, I am grateful to the hon. Member for Southwark and Bermondsey (Mr. Hughes) for raising this important subject, and I am certain that the words of the hon. Lady, who I believe has been in the House marginally longer than the hon. Gentleman, will be read closely by many of the politicians in south London who we on these Benches believe are largely responsible for the plight of so many people.
  Before I come to the matters that have been raised in the debate, I shall paint the background. I congratulate the hon. Member for Southwark and Bermondsey on his detailed knowledge of London history and, indeed, those who have contributed to our country's literature, while being London residents. That appeals to me as a Londoner born and bred, and as one who once fought my right hon. Friend the Member for Daventry (Mr. Prentice) when I was a candidate for East Ham, North in 1970. Like the two hon. Members, I represent a London seat.
  We all recognise that the Thames is one of the greatest assets— if not the greatest asset—of our capital city. Indeed, we must not forget that it was the original reason for the existence of London. For centuries, it formed the main link between London and Europe and the rest of the world. Other, more modern, forms of land and air transport have come along. Water-borne transport on which the Thamesside industries relied, however, has also changed. The development of modern forms of shipping has demanded deeper waters, not available in the central and upper reaches, and the docks have closed progressively. It is a well-known fact of history that the decline of the docks and dock-related industry has been swift, and some would say, devastating. London is not the only region that has suffered from that affliction.
  The first major docks were built in the early 1800s and operated continuously for 160 years. Closures started in the East India dock in 1967, to be followed rapidly by St. Katharine's and London docks in 1969, Surrey docks in 1970, and 10 years later, the West India and Millwall dock on the Isle of Dogs, and finally the Royal group as was announced in 1981, also closed. Riverside wharves and warehouses, their trade gone, closed down, leaving behind them many magnificent but empty buildings — part of our heritage.
  The strength of London and Londoners over the centuries has been a willingness and an ability to adapt to changed circumstances—not, as a colleague remarked many years ago in the House, being in favour of progress as long as it does not mean change. I certainly would not hurl that accusation this evening.
  There can have been few periods, if any, in London's history when such a change has taken place on such a scale. A whole industry, with its supportive industries, moved away, taking with it the livelihood and lifestyle of thousands upon thousands of people. I think that hon. Members will acknowledge that fact. Some people might have seen such devastation as insoluble and simply walked away from it. We in London could not take, and have not taken, that view.

  1097
  One has only to look along the river to see major new developments which have taken place during the post-war years, which are thriving and providing work for the people we represent. I speak not only as the Minister with responsibility for planning but even more as a London Member, as indeed is my right hon. Friend the Secretary of State.
  Many people have dreamed that it would be possible to produce a grand design for redeveloping the whole of London's river frontage, thinking perhaps of Paris. But opportunities for that kind of grand exercise are rare and simply not available now in London. Too many, indeed most, of the major sites on the river have already been developed to allow that grand design. What we need to do now is to carry that redevelopment forward in a coherent way, preserving the best of the past and producing new developments which meet today's needs and reflect the best architecture of our times.
  While the grand scheme is not open to us, one important theme should be pursued when potential riverside development is contemplated. Ideally, any new development should reopen access to the riverside for the enjoyment and recreation of the general public. For too long the river has been walled—indeed, even isolated from view. Wherever possible such access should be extended along the bank to provide riverside walks.
  The hon. Member for Southwark and Bermondsey raised some questions about planning procedures. Let me make clear at this stage the statutory basis, which I have no need to justify. Parliament decided, when it passed the Local Government Planning and Land Act 1980, that there should be a procedure, as the hon. Gentleman said—section 148 — under which an urban development corporation could submit proposals for development to my right hon. Friend for his approval. This procedure has been in existence for many years and proved its worth, certainly in new town development. It also decided in effect that the procedure for my right hon. Friend to consider such proposals should be reasonably speedy, while insisting that he should consult interested local authorities before reaching his decision. I submit that such a procedure is reasonable when set against the overall directive given to a development corporation in section 136 of the Act to secure the regeneration of that area. That is the most important feature. One must remember the importance of the regeneration of a community.
  The London Docklands Development Corporation having properly submitted proposals for development of the Hay's wharf area under section 148, my right hon. Friend was under a statutory duty to consider them, and that he has done. He has given his reasons for approving those proposals in his decision letter, a copy of which has been sent to the hon. Gentleman. I am sure this House would expect no other course to be taken by my right hon. Friend.
  As to the hon. Gentleman's claim that the consultation procedure carried out was cursory, I can only say that it was fully in accord with the terms of the Act. Equally, it is true that much of it took place during the run-up to the general election. Though the media and hon. Members may choose to take a different view, life is not suspended, nor are the local authorities, during an election period and statutory processes go ahead.
  1098
  The hon. Gentleman also asked whether I can give an undertaking that section 148 procedures will not be used again. Of course I cannot and will not—the procedures are there, and are there to be used if that seems to the applicants to be the appropriate way forward. They will remain to be used as and until Parliament decides otherwise and takes steps to repeal them.
  The question arises when it is right to give planning permission and whether it is the local planning authority or my right hon. Friend involved. The hon. Gentleman seemed to be suggesting that there were other preferable uses for the site about which he expressed most concern —Hay's wharf. I must point out that the only proposal before my right hon. Friend was that put forward by the London docklands development corporation, which incorporates significant office development as well as other commercial, technological industry, housing and recreational open space uses. Planning authorities—or in this case my right hon. Friend—are called upon in such circumstances to decide whether what is proposed is an acceptable use, on planning grounds, of the site in question. It is not a matter of whether what is proposed is the only use which may be possible or, indeed, acceptable.
  There is no reason why more than one form of development should not be approved in respect of any particular site if proposals are put forward in the appropriate form. Planning permission opens the way for development. It does not compel it. It must be for the owner or developer to judge the most appropriate time for development to begin, based upon his assessment of market demand. That is an important consideration. He must be allowed to judge the pace at which larger phased developments take place — all of course, within the general constraint that planning permissions are time limited.
  The hon. Gentleman touched on times, and I must remind him that it is not true that there are no time limits as far as Hay's wharf is concerned. There are time limits in the Hay's wharf approval. Phase one is five years to begin, and phase two is seven years. The hon. Gentleman also referred to the problems of unemployment in his constituency and to the particular skills and needs of the labour force. We all share his anxiety, and I have total sympathy with him in his concern. However, these problems cannot necessarily be solved by the planning process. The needs as I perceive them are to press ahead with regenerating the rundown areas with all possible speed. Just about every area that the hon. Gentleman mentioned has been progressively run down. That is true whether the area is by Vauxhall bridge or in any of the other parts that he mentioned. We are talking about regenerating that river front, and we are determined to regenerate those rundown areas with all possible speed and with developments that have an economic demand and a soundly based future. Only in that way will the local economy revive.
  I urge the hon. Gentleman to consider that point, because, whatever his views, I believe that there are many important features to the development that will help his constituents. Successful developments bring in their train others that feed on and support them. I hope that the hon. Gentleman will consider that, because I know that he cares deeply about the issues involved. However, such developments can help in many ways.
  Mr. Simon Hughes: The nature of the work force is such that the majority of people are trained, or at least semi-skilled, in occupations that are not reflected primarily in commercial developments. From the history of London it is clear that commercial developments bring employment primarily to those who live outside the city. The only exception is the service element. Will the hon. Gentleman accept that one consideration that is as important as any other is that the development should take place not necessarily quickly—because that has no merit in itself—but in a way that meets the demand for work and takes account of the skills of the local community, as evidenced by all the figures available?
  Mr. Macfarlane: I note what the hon. Gentleman has said and shall come to that later. An important point is that people commute daily because the necessary facilities and dwellings do not exist in most inner city areas.
  To refuse proposals simply because they do not meet immediately perceived needs for other forms of development for which there are neither proposals nor market demand could be a recipe for stagnation and the continuation of dereliction. Those are the very problems that we are trying to overcome. Dereliction, unused and underused sites, decaying buildings and corrugated iron are all the classic symptoms of inner city deprevation in our older areas. They all act as disincentives to the attraction of new industry and commerce and can and do lead to further decay, and to a sense of total exasperation and despair.
  Major developments such as Hay's wharf, when they can be attracted to such areas, make enormous contributions. They contribute to employment during construction and after. They make a contribution to the quality of life in the area. They may generate civic pride. They contribute to local services, supply industries and rate income.
  What needs to be done with the decaying areas? We need to encourage development which can lift up the older areas and improve the environment to make them places where people want to live and work and invest in the future. That cannot be achieved by any one body or agency.
  We believe that we need drive, enthusiasm and co-operation. By that I mean co-operation between central Government, local government, the private sector and the local community.
  The Government, for their part, are working to that end and I am pleased to say that the private sector is enthusiastically joining with them. Local government is perhaps more patchy in its response, but in many areas is also active in promotion.
  We have particularly recognised the size of the problems of dereliction and underutilisation of docklands from Tower bridge to Beckton on the north bank and from London bridge around the Southwark peninsula on the south bank. The Government established the London docklands development corporation to tackle the task of regenerating the area. What was needed was a single-minded, clearly identifiable, development agency, with development control powers, which could act as a catalyst for the involvement of the private sector and direct public resources to where they are most needed. In only two years the LDDC has made a significant contribution to the regeneration of docklands.
  1100
  The LDDC has secured the first large-scale development of housing for sale in docklands since the war, with the emphasis on low cost housing within reach of the local people. Four major private builders have developed a 22 acres site for 601 houses and flats, and site preparation for a further 1,080 has begun. In Southwark, the LDDC has released land on five sites on which 450 homes are being built. The first dozen of the homes for private sale were sold immediately on completion to local people and there is evidence of considerable local demand — one developer was, indeed, overwhelmed by the numbers of local tenants who queued overnight seeking to buy.
  In the Lavender dock area the LDDC is helping to finance a housing association to purchase 111 of the new homes for renting to some of the residents of the rundown London borough of Southwark-owned Downtown estates. This became necessary to keep faith with Downtown residents when Southwark reneged on an agreement with LDDC whereby Southwark would purchase new housing provided on LDDC land.
  Mr. Simon Hughes: I have been round some of the houses and I know that the need for them exists. I hope that the Minister accepts that houses costing £50,000 and £60,000 do not meet local people's needs. Has the LDDC already reconsidered the price range so that particularly round Greenland dock a lower cost housing scheme will be approved?
  The Minister said that the community was part of the co-operative plan. Why is it that the Secretary of State, having consulted during the election campaign—perhaps not the best time — and held a public meeting in Southwark, chaired and run by the two local authorities concerned and which revealed unanimous opposition to the proposals, did not think it necessary to hold a public inquiry? It was clear that the one public consultation resulted in total opposition to the proposal.
  Mr. Macfarlane: One public consultation is not the only way. It is certainly not the most successful way of ensuring a speedy regeneration. I cannot answer fully all the questions that the hon. Gentleman has asked, but I shall ensure that he receives replies.
  In the development of any housing estate, there must be a range of prices. I hope that the hon. Gentleman's comments will be noted. I shall take them up.
  Many people in the area thought that the land would be used to rehouse tenants of the downtown blocks and that the vacated blocks would be sold to the LDDC which would then arrange for their demolition and redevelopment, in some cases conversion, to provide further low-cost housing.
  In April 1982, the Isle of Dogs enterprise zone was designated and the LDDC has been carrying out major infrastructure work costing about £7 million. The hon. Member is as interested as I am in the regeneration of the river front. Over 100 acres of land have been released on the market, and the first disposals to the private sector have been completed. About 250,000 sq ft of factory space is being built. That is no mean achievement in a comparatively short time, and it bodes well for the future.
  In carrying out these developments and in considering others which have been approved, and to which the hon. Gentleman has referred, we and the other bodies involved have been concerned to see that the proposals put forward

  1101
  will stand the test of architectural quality. Design competitions are one means of achieving this—though not the only one. The London docklands development corporation is committed to achieving good design and in its two most recent exercises, at Elephant lane and Cherry Garden pier it has, respectively, run and is about to run competitions working closely with the Royal Institute of British Architects. In the case of Elephant lane, where the judging is complete, a representative of the local tenants association was brought in as one of the assessors. It was a useful example of local community involvement.
  The designs of buildings of course never, or hardly ever, satisfy everyone. The hon. Gentleman and I might disagree, but "beauty is in the eye of the beholder" holds just as firmly in architecture as it does in other fields. There are those who wish to see reproductions of buildings already in existence. There are high tech modernists and others. Reconciliation of each view is not easy—it may be impossible. To the hon. Gentleman's request to sustain an architectural distinction between the two banks of the river I can say only that I can see no point, nor can I see how it could best be achieved. Let us by all means preserve the best of the old—as in Hay's wharf the promoters are proposing to do—but let us not be frightened of the new. Let us rather see that it can live in harmony with the old. That is an important amalgam.
  1102
  I was asked also how my right hon. Friend the Secretary of State considered the proposals. On that, as on other matters, he considered the proposals, the representations made on them by the consultees and advice available to him from within the Department of the Environment. As I have already pointed out, my right hon. Friend is and has been a London Member for many years. I doubt whether he, any more than other London Members, can have attended this place regularly without being aware of the situation at a site as prominent and as close to the Palace of Westminster as Hay's wharf.
  Things are moving on the regeneration of the Thames riverside. We are firm in our policy of pressing ahead to produce an environment of which London can be proud. At one stage of his speech the hon. Gentleman was overly gloomy. I do not know whether he has a political point to put forward or what pressures he has from his constituency, but I believe that, with his open mind, he must recognise that a great deal of good is coming out of what we are now planning. This will enable the Thamesside area to continue to do what it has always done —contribute to the greater welfare of London and the country at large.
  Question put and agreed to.
  Adjourned accordingly at seventeen minutes to Ten o'clock.