Commons Sitting of 21 July 1983

Preamble
The House met at half-past Two o'clock
PRAYERS
[MR. SPEAKER in the Chair]
PRIVATE BUSINESS
  STAFFORDSHIRE BILL [Lords]
  Read a Second time and committed.

  TEES AND HARTLEPOOL PORT AUTHORITY BILL (By Order)
  Orders for Second Reading read.
  To be read a Second time upon Thursday 28 July.

Oral Answers to Questions
  NORTHERN IRELAND

    Security
    Mr. Farrasked the Secretary of State for Northern Ireland if he will make a statement on security in Northern Ireland, particularly with reference to cross-border co-operation.
    Mr. Stanbrookasked the Secretary of State for Northern Ireland if he is satisfied with the degree of co-operation provided by the Government of the Republic of Ireland in the pursuit and apprehension of those accused of criminal offences in Northern Ireland.
    Mr. Stephen Rossasked the Secretary of State for Northern Ireland if he will make a statement on the security situation within the Province.
    The Secretary of State for Northern Ireland (Mr. James Prior): Since I last answered questions on 12 May, eight members of the security forces and four civilians have died as a result of the security situation in the Province.
    On 16 May a constable was murdered outside his home in Belfast and on 26 May a constable was shot dead while on duty outside Cookstown police station. A part-time member of the Ulster Defence Regiment was killed by an explosive device near Dungannon on 4 June and on 10 June a soldier on foot patrol was killed in a similar manner in Belfast. On 13 July four members of the UDR were killed when a bomb exploded under their vehicle in county Tyrone.
    The civilians were a milkman shot dead in Belfast on 26 May, a workman shot dead in county Tyrone on 27 June and two men whose bodies were discovered in a car in south Armagh on 13 July.
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    It is a tribute to the security forces that many of the attempts by terrorist groups to increase tension in the prelude to the general election failed and that a number of arrests were made. The RUC continues to have considerable success in bringing to justice those whom it suspects of terrorist type offences. So far this year 288 people have been charged with such offences, including 32 with murder, and 30 with attempted murder. Nineteen of the murder charges and 18 of those for attempted murder were made during the period since 12 May. 125 weapons, 31,780 rounds of ammunition and 1,707 lbs of explosives have been recovered so far this year.
    The RUC and the Garda continue to co-operate closely both in deterring acts of terrorism and in bringing criminals to justice. We shall continue to make it clear to the Irish Government that we believe workable extradition arrangements to be the best way of dealing with fugitive offenders, although we value the recent successes achieved under the extra-territorial legislation.
    Mr. Farr: I am grateful to my right hon. Friend for that reply. I am sure that the whole House will wish to express its admiration for the sacrifices made by the security forces and the RUC. On Tuesday the Minister for Foreign Affairs in the Republic of Ireland will be in London. During his visit, will my right hon. Friend mention the importation of weapons from the Republic into Northern Ireland and see whether control can be tightened by closer cross-border co-operation? For example, today there was a rocket attack in Londonderry, which was probably caused by an imported rocket.
    Mr. Prior: I am grateful for what my hon. Friend said. There is another question on the Order Paper about the visit of the Republic of Ireland Minister for Foreign Affairs. I shall take every opportunity to impress upon him the need for maximum co-operation across the border, particularly with regard to weapons.
    Mr. Stephen Ross: May I, too, express my admiration for those who lost their lives and echo the words of the hon. Member for Harborough (Mr. Farr)? As four UDR men were so tragically blown up in a convoy last week, and as there have been similar instances involving Army convoys, is the Secretary of State satisfied that every effort is being made to pinpoint such traps before the event, perhaps by using increased air surveillance?
    Mr. Prior: I am satisfied that every effort is made to do so, by a variety of methods. The trouble is that there are an enormous number of culverts and it is extremely difficult to keep a watch on all of them. However, on several occasions recently the RUC and the security forces have successfully stopped those devices and retrieved a great deal of explosives which would otherwise have caused serious casualties.
    Mr. Kilfedder: Does the right hon. Gentleman appreciate that there can be no real security for the Ulster people, who have suffered terribly for more than 14 years from IRA terrorism, unless and until the terrorist murderers are put behind bars and kept there for the rest of their natural lives? Will he re-examine the question of the remission of prison sentences for terrorists? Surely the half remission should be brought to an end.
    Mr. Prior: No terrorist who has been convicted of murder, except a man suffering from cancer, w ho was about to die, has been released since the present campaign

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    began. I have examined the 50 per cent. remission and the system of parole that operates in Great Britain as a possible replacement for 50 per cent. remission. I believe that we are right to continue with the 50 per cent. remission. There have been examples of men returning to terrorism, but there have been many cases of men who have reformed and behaved perfectly responsibly afterwards.
    Mr. William Ross: How many people who are being sought by the RUC in connection with terrorist crimes are believed to be in the Republic of Ireland? In how many of those cases has the RUC asked the Garda to arrest and return them?
    Mr. Prior: I cannot give the hon. Gentleman the figures that he requires, because we cannot possibly know. The RUC asks for terrorists to be extradited. If the hon. Gentleman requires further information about that, I shall see what can be made available to him.
    Mr. Concannon: In view of the terrible list of events which the Secretary of State was obliged to read out once again, I should like to express the Opposition's gratitude to the security forces for the way in which they carry out their duties in Northern Ireland. As circumstances have changed in Northern Ireland and Sinn Fein has gone political, is the Secretary of State receiving expressions of condemnation by the new political party of acts of violence?
    Mr. Prior: Far from it; quite the reverse, in fact. That should not be lost on anyone who seeks the path of peace and anyone who supports Provisional Sinn Fein and wants to make a visit here. I hope that that message will not go unheeded.

    Provisional Sinn Fein
    Mr. McCuskerasked the Secretary of State for Northern Ireland if he will proscribe Provisional Sinn Fein.
    Mr. Prior: I have no plans to do so.
    Mr. McCusker: Does the Secretary of State still agree with the assessment that was made some months ago by the then Home Secretary and the Commissioner of Police of the Metropolis that senior members of Provisional Sinn Fein, including Gerry Adams, were involved in the commission of serious terrorist offences? If he does not, why is he still refusing to talk to them? Is it not the case that Provisional Sinn Fein forms the essential propaganda element in the terrorist campaign that is being waged in Northern Ireland, and is it not time that the Government declared this organisation illegal?
    Mr. Prior: My reason for refusing to talk to such people is clear, and I wish that this practice was followed by a good many others. Until people renounce violence, they should not be talked to. The problem arises when they represent the views of constituents. In those circumstances, there will be infrequent occasions when, as part of a deputation which perhaps consists of other Members of Parliament or Members of the Assembly, one has to see them. I hope that the clear message will go out from the House that while Provisional Sinn Fein acts unconstitutionally and supports violence, although no charges of violence can be brought against individuals, I hope that nobody will pay any attention to what its members say until they renounce violence.
    Rev. Martin Smyth: Following the Secretary of State's reply to my hon. Friend the Member for Upper Bann (Mr. McCusker), will he use his influence, following the example of the Government of the Republic of Ireland, to ensure that Provisional Sinn Fein is not given radio and television time, bearing in mind that that is the way in which it backs up its support for active terrorists?
    Mr. Prior: There is a difficulty in that regard, because we do not control who has television and radio time. If we did, I could perhaps go further and agree with the hon. Gentleman's suggestion.

    Republic of Ireland (Ministerial Meetings)
    Mr. Molyneauxasked the Secretary of State for Northern Ireland what consultations he anticipates having during the forthcoming recess with the Government and Ministers of the Republic of Ireland.
    Mr. Parryasked the Secretary of State for Northern Ireland if he has plans to meet the Prime Minister of the Republic of Ireland.
    Mr. Winnickasked the Secretary of State for Northern Ireland when he next intends to meet the Prime Minister of the Republic of Ireland to discuss matters relating to Northern Ireland.
    Mr. Flanneryasked the Secretary of State for Northern Ireland if he has any plans to hold discussions with the Prime Minister of the Republic of Ireland.
    Mr. Prior: I intend to meet the Irish Minister for Foreign Affairs, Mr. Peter Barry, during his visit to London next week. I have no plans to meet the Prime Minister of the Republic of Ireland.
    Mr. Molyneaux: In his dealings with Ministers of the Republic of Ireland, will the Secretary of State bear in mind that their ideas of how Northern Ireland should be governed are designed to achieve a united Ireland? Will he also remember that what other nations regard as friendly relations, Dublin regards as mechanisms for proceeding towards that objective?
    Mr. Prior: I do not go as far as the hon. Gentleman in his assessment of what the Republic of Ireland regards as friendly relations with the United Kingdom. There are great advantages in having better relations—indeed, the best relations—between the Republic of Ireland and the United Kingdom. I hope that when we meet Ministers from the Republic it will not always be thought that the constitution of Northern Ireland is likely to be changed, as that is not what is involved.
    Mr. Parry: When the Secretary of State meets Dr. FitzGerald, will he discuss the statement on Northern Ireland in the Queen's Speech? Will he state what steps he proposes to take to get the various groups in Northern Ireland involved in the work of the Assembly? If he does not, will it not be obvious that the Assembly is a white elephant?
    Mr. Prior: I do not agree that the Assembly is a white elephant. It is doing extraordinarily valuable work and many people recognise that. The hon. Gentleman and his hon. Friends could help considerably by supporting the efforts that are being made to get the SDLP into the Assembly. There is no doubt that it would be a far better and more representative Assembly if the SDLP were playing a part there.
    Several Hon. Members rose—
    Mr. Speaker: Order. I propose to follow my usual practice and call first those hon. Members whose questions are linked.
    Mr. Winnick: In view of the continuing tragedy in the Province, when will the Government realise that there can be no successful initiative and no political settlement without the involvement of the Government of the Republic of Ireland? Are the reports that have appeared in The Guardian this week true? It is said that British Army chiefs have argued strongly against any concept of a united Ireland, on the somewhat dubious ground that it would be unsafe for Britain from a military point of view.
    Mr. Prior: I do not intend to enter into arguments that are raging in the Labour party. Good relations between the Republic and ourselves are important. That is in no way inconsistent with the right of the majority to remain part of the United Kingdom. We must find some way in which to enable the 40 per cent. or so who support the nationalist cause to identify with their feelings and traditional aspirations of a united Ireland. That is not in question at the moment.
    Mr. Flannery: Is it not a fact that if the stance of not wanting discussions of any type with the Republic of Ireland—which is to be found on the Bench behind me — continues, there is no hope of solving the fundamental issue of what is happening in Northern Ireland?
    As my hon. Friend the Member for Liverpool, Riverside (Mr. Parry) said, is not the Assembly a failure? Its aim was to bring the two sides together, but the Catholic minority will have no part of it. In his discussions with the leaders of the Republic of Ireland, will the Minister seriously consider setting up a lasting forum such as an Assembly of Ireland to discuss, security, trade, industry and other matters, which will bring people together naturally? Does he agree that the policies of the Unionists are bankrupt?
    Mr. Prior: The proposals advocated by the hon. Gentleman would have precisely the opposite effect to that which he wishes to achieve. He could help considerably by trying to persuade the SDLP to play a part in the Assembly. The Unionists should also invite and encourage the SDLP to play a part in the Assembly, because that would be the first step to bringing the two sides together, which is essential.
    Mr. Arnold: Have the Government of the Republic of Ireland made any approaches to my right hon. Friend about the Irish Forum?
    Mr. Prior: No, they have not.
    Mr. Madden: In considering the future of the island of Ireland, will the Secretary of State examine the long and perceptive statement issued recently after the Irish conference of Catholic bishops? Is he aware that the statement contained many interesting items, including the fact that the scandal of our time was the great and growing gap between the wealthy few and the deprived? Will he draw attention to that statement and reflect upon it when he considers the future of Ireland?
    Mr. Prior: I reflect on many statements that are made by people of many different religions in Northern Ireland and in the island of Ireland. I am trying—I am not sure
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    that the Floor of the House is the best place to do it—to do as much as I can to enable people to live at peace with one another.
    Dr. Mawhinney: Does my right hon. Friend accept that most hon. Members believe that it is in Britain's interest to foster good relations between the United Kingdom and the Republic of Ireland? Does he also accept that while the political parties in Dublin discuss how they could politically adminster the affairs of Northern Ireland, which is an integral part of another independent sovereign state, many people will continue to be suspicious, not of my right hon. Friend, but of those who have aspirations towards that part of the United Kingdom?
    Mr. Prior: I agree with my hon. Friend's comments, and I hope that my talks with Mr. Barry and others will help to dispel some of the false ideas that have crept in.
    Rev. Martin Smyth: In the light of a perceptive article in the Daily Telegraph this week, will the Secretary of State assure the Prime Minister of the Republic of Ireland that the House and the nation are not amused by the fact that the Forum has continued, especially as one part of that Forum refuses to take its place in the Northern Ireland Assembly? Will he confirm that 31 per cent., not 40 per cent., of the people voted for Republican causes, and that Roman Catholics are taking part in the Assembly and have given evidence to it?
    Mr. Prior: Several Catholics representing the Alliance party sit in the Assembly, and we welcome their role. I did not agree with much of the article in the Daily Telegraph.
    Mr. Adley: Did my right hon. Friend see the press reports earlier this week which alleged that, during discussions some years ago between the right hon. Member for Morley and Leeds, South (Mr. Rees), when he was Secretary of State for Northern Ireland, and the then Prime Minister of the Republic of Ireland, the Irish Prime Minister said that the last thing he wished was a substantial change in the constitution if it involved a so-called British withdrawal from Northern Ireland? Will my right hon. Friend make it clear that we all want good relations, but that a forced marriage could be disastrous?
    Mr. Prior: Forced marriages are never successful. I shall not enter into discussions about what was said by former Secretaries of State in other Governments to Prime Ministers of other countries.
    Mr. Freeson: Will the Secretary of State bear in mind in the forthcoming discussions, and in future similar discussions, that the British people will not always put up with the fact that any proposals to bring together all sides in the whole of Ireland are vetoed by one group in the United Kingdom? Does he agree that Parliament and the Government must take into account the interests and views of the entire British population, and that there should be an end to a veto that blocks negotiation and discussion on the future of the Province?
    Mr. Prior: Several people have the right of veto, but the wish of the majority must be respected. That does not alter the fact that the minority also have rights and aspirations which the House should take into account. I am trying to do that.
    Mr. Concannon: Is the Secretary of State aware that the Opposition would encourage him to talk to as many people and groups as possible, except those who advocate

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    violence, and that we would encourage discussions with the Government of the South? As my hon. Friend the Member for Sheffield, Hillsborough (Mr. Flannery) said, if we cannot get people together across the table we should adopt policies that will help them to grow together. I endorse my hon. Friend's suggestions.
    Mr. Prior: I always listen carefully to advice from all sections and from all parties in the House. The more the House speaks with a united voice, the more likely we are to make progress in Northern Ireland.

    Larne-Belfast Rail Link
    Mr. Beggsasked the Secretary of State for Northern Ireland if he will make a statement about the future of the Larne to Belfast rail link.
    The Under-Secretary of State for Northern Ireland (Mr. Chris Patten): The Department of the Environment for Northern Ireland and the Northern Ireland Transport Holding Company are reviewing the financial requirements of the Province's railways over the next decade on the basis of a corporate plan prepared by Northern Ireland Railways. This review is designed to ensure that public transport resources are used as effectively as possible, and includes the operational activity of the Lame to Belfast rail link.
    Mr. Beggs: Does the Minister accept that the absence of a cross-city link means that rail services in Northern Ireland are inadequate?
    Mr. Patten: The construction of the link must be determined in the light of our judgment of the effects of the recently-opened M1-M2 link on the city's traffic patterns. As I told the hon. Gentleman last week, I hope to travel on the Belfast to Lame line during the next few days.
    Mr. J. Enoch Powell: Will the Minister ensure that the review to which he referred includes consideration of the practicability and desirability of renewing the rail connection to Newry and Warrenpoint?
    Mr. Patten: I shall be happy to review everything during the next financial year, and I shall certainly review what the right hon. Gentleman suggests.
    Mr. McQuarrie: Will my hon. Friend bear in mind that many Scots travel from Stranraer to Larne to join that line, and that any reduction in the service to Belfast would be most disappointing to them?
    Mr. Patten: I note what my hon. Friend says and I shall bear it in mind when I consider the matter.

    Housing Executive
    Mr. A. Cecil Walkerasked the Secretary of State for Northern Ireland if he is satisfied that Her Majesty's Government provide sufficient funds to the Northern Ireland Housing Executive to enable it to maintain its houses in Belfast adequately.
    Mr. Chris Patten: I hope to discuss this matter shortly with the Northern Ireland Housing Executive, but I should make it clear that the funds allocated to the housing executive for maintenance in the current year reflect the spending requirements agreed between my Department and the executive when public expenditure allocations for 1983–84 were being considered.
    Mr. Walker: Is the Minister aware that several houses in estates managed by the housing executive within the inner city complex are not wind and weather-proof? Will he provide some money before the onset of winter, to help resolve the problem?
    Mr. Patten: I know how worried the hon. Gentleman is about the matter, because I had a brief word with him about it in Belfast a few days ago. I repeat that the amount of money being spent at present is that agreed between the Department and the housing executive last winter. However, the executive is aware that it can seek approval to increase the allocation if we can shift resources round within the total budget. I shall certainly discuss the matter with the housing executive.
    Mr. Soley: If expenditure on renovation and repairs were significantly increased, would not that not only improve the quality of housing but provide employment in the construction industry?
    Mr. Patten: I am sure that the hon. Gentleman will welcome the fact that expenditure on maintenance by the housing executive increased from £31·1 million in 1979–80 to £48·2 million in 1982–83, with a consequent effect on employment in the construction industry.
    Mr. Skinner: Does it not show clearly the Government's double standards to make announcements about increasing allocations for an area of the country which has been hit by massive unemployment over a long period, when later today another Minister will propose massive cuts in the money allocated to local authorities, principally in Scotland, but no doubt later in England, and tell them to cut their housing and welfare services and to hammer the poor, the homeless and the elderly?
    Mr. Patten: I suspect that that is a little far from the question on the Order Paper.
    Mr. Flannery: No, it is not.
    Mr. Patten: Any reference to double standards is certainly far removed from the Northern Ireland Office.
    Mr. Nicholson: Is the Secretary of State aware of the problems facing my constituents who live in Orlit cottages because of the housing executive's lack of initiative in rehabilitating those cottages to provide the basic facilities required?
    Mr. Patten: I understand that the housing executive considered the problem of Orlit cottages at its meeting yesterday morning and made proposals which will shortly be put to the Department. It is important that we resolve that problem as soon as we can, because I am aware of the considerable anxiety that it has caused to many tenants and owners.

    Northern Ireland Assembly
    Mr. Michael NcNair-Wilsonasked the Secretary of State for Northern Ireland whether he has any proposals to allow the transfer of a greater share of government to the Northern Ireland Assembly.
    Miss Maynardasked the Secretary of State for Northern Ireland if he is satisfied with the way the new Assembly is working.
    Sir John Biggs-Davisonasked the Secretary of State for Northern Ireland what is his policy towards the future of the Northern Ireland Assembly.
    Mr. Prior: The people of Northern Ireland will continue to be offered, through the Assembly and the Northern Ireland Act 1982, a framework within which there can be agreement on devolution among representatives from both sides. It is for the Assembly to put forward devolution proposals. The Government's view is that stable political arrangements can come about only through arrangements that enjoy substantial support from both sides of the community. Until such agreement is possible, the Assembly will continue to have the functions, which it has already set about with vigour, of considering proposals for draft legislation and scrutinising the activities of the Northern Ireland Departments.
    Mr. McNair-Wilson: Is not my right hon. Friend in danger of sacrificing the future effectiveness of the Assembly on the altar of SDLP intransigence? Should he not reconsider the 70 per cent. provision and see whether there is some other way to sound out the majority view in Northern Ireland about the way in which the Assembly might progress in the future?
    Mr. Prior: No. The key issue is not the SDLP but the fact that any arrangement to devolve power to a Northern Ireland Assembly would simply not work unless it had widespread acceptance throughout the community. Moreover, I do not believe that bringing orders before this House which did not have that widespread accceptance would gain acceptance here.
    Miss Maynard: Does the Secretary of State agree that it is time we stopped treating Northern Ireland as a colony? Should we not withdraw the Unionist veto, so that we can get down to discussing the politics of the situation and how to bring about a united Ireland? Does he agree that until that is done the killing, the violence and the whole hellish situation will continue?
    Mr. Prior: I must tell the hon. Lady and those who might support her that the one certain way to increase the violence and lead to civil war in Northern Ireland would be to try to make the majority in Northern Ireland act in opposition to their own views. Therefore, we must seek agreement peacefully. It is no good saying that a united Ireland is the answer when we know perfectly well that that is unacceptable to the majority. We have to try to move forward rather more sensibly than that.
    Sir John Biggs-Davison: Having regard both to the absence of the desired consensus on devolution and to the good work done by the Assembly Committees, is it not better to proceed with a single statute book and the development of Ulster Committees of this Parliament, which could sometimes meet at Stormont?
    Mr. Prior: No, Sir. As my hon. Friend knows, we have discussed that at considerable length. I do not believe that the integration of Northern Ireland into the workings of the United Kingdom in the same way as county councils, for example, operate here would be acceptable or would work.
    Mr. William Ross: As the right hon. Gentleman had such high hopes of the Assembly when he created it, is he not deeply disappointed that to date proposals for devolution have not been forthcoming from it?
    Mr. Prior: No, I am not disappointed. I never thought that it could happen quickly. We always said that it would take some while for the Assembly to move on to the second stage. The hon. Gentleman and others do the Assembly no good, and fail to give it the recognition that it should have, by constantly carping because it has not yet moved to a further stage. I hope that it will do so, but I think that it will take time.

    Antrim Area Hospital
    Mr. Clifford Forsytheasked the Secretary of State for Northern Ireland when the new Antrim area hospital will be completed.
    Mr. Chris Patten: The Government remain committed to the modernisation and rationalisation of services in the northern board area. I am having discussions with the board to determine how the cost and construction of the new hospital can be accommodated within planned spending programmes, but I am not yet in a position to say when the hospital will be completed.
    Mr. Forsythe: Does the Minister agree that further delay on the new hospital is intolerable in view of the undertakings given by successive Governments?
    Mr. Patten: I hope to open the Antrim group school of nursing in late September or early October. By the time that happy event takes place, I hope to be in a position to say something more positive than I have been able to say today.
    Dr. Mawhinney: Does my hon. Friend intend to allow private firms to tender for catering, cleaning and similar services in the new Antrim hospital?
    Mr. Patten: Of course.
    Mr. William Ross: Does the Minister realise how deeply disappointing his answer will be to my constituents, as the Coleraine hospital will not be built until the Antrim hospital is completed? Which generation of my constituents can look forward to a new hospital in Coleraine?
    Mr. Patten: I hope that the regional strategic plan, which will shortly go to the Assembly, and what I am able to say in the autumn will go some way to reassure the hon. Gentleman's constituents about the improvement of facilities and the rationalisation of acute care facilities in the board area.

    Labour Statistics
    Mr. Fatchettasked the Secretary of State for Northern Ireland what is the ratio of unemployed persons to unfilled vacancies, on the latest available figures.
    The Minister of State, Northern Ireland Office (Mr. Adam Butler): At June 1983 the ratio of unemployed persons to registered unfilled vacancies in Northern Ireland was 68:1.
    Mr. Fatchett: I am sure the Minister recognises that that ratio tells a sorry story and that unemployment in Northern Ireland doubled under the previous Conservative Administration. Is he aware that the further cuts in public spending rumoured in certain newspapers will add to the dreadful unemployment in Northern Ireland? Will he give a commitment that he will resist further cuts in public spending?
    Mr. Butler: I welcome the hon. Gentleman to our Northern Ireland proceedings. I hope that he will continue to play a part and will visit us in Northern Ireland. There is no denying the seriousness of unemployment in the Province. The Government are tackling it in the best way that they can. Those who clamour for further increases in expenditure will not achieve the objective that they seek. If, as I hope, there continues to be a proper and prudent approach to Government expenditure in Northern Ireland, it will benefit from the lower interest rates and other advantages that follow.
    Mr. Soley: Is not the figure of 68:1 an appalling measure of this Government's disastrous economic policies, and a terrible warning to the rest of the country? Does not that figure show more than anything else that the economy is not recovering? Is it not equally clear that the investment in the pipeline will not significantly improve that figure? What steps will the Government take to alleviate unemployment and, above all, improve the availability of jobs in Northern Ireland?
    Mr. Butler: The hon. Gentleman is making the great mistake of attaching too much importance to that figure. What matters is the small increase in the number of vacancies that are appearing. The position has improved, albeit marginally, over the past six months and that is a cause for small encouragement.

    Baton Rounds
    Mr. Dubsasked the Secretary of State for Northern Ireland if, in view of the jury's findings in the inquest into the death of Stephen McConomy, he will introduce stricter measures to control the firing of baton rounds.
    Mr. Prior: The Chief Constable and the GOC have issued clear instructions which ensure that baton rounds are used only when other means of controlling disturbances are ineffective and the risks are justified. I have reviewed the situation in the light of the recent inquest and I do not consider that the present instructions require amendment, but we continue to look for acceptable alternatives.
    Mr. Dubs: Does the Minister accept that the evidence given at the inquest on this young boy showed that the plastic bullet gun was defective and that this defect contributed to, if not caused, the boy's death? Is not the conclusion, in the light of 14 deaths so far through the use of plastic and rubber bullets in Northern Ireland, that these are dangerous weapons and, unless they are banned, further deaths will follow?
    Mr. Prior: As the hon. Gentleman knows, the defective weapon was one of the factors considered by the Director of Public Prosecutions, who decided that no prosecution should take place. I can give the House an example of the problems with which the police have to deal. Last Saturday, the police in Londonderry were attacked with 350 petrol bombs and in one night in May they were attacked by 500 petrol bombs and nine live shots. These are the problems that we ask our people in Northern Ireland to deal with, and they must have the weapons that they feel are necessary to protect themselves.
    Everything will be done to keep tight control on any use of plastic baton rounds. As hon. Members will know, the number that has been used in the past year is a fraction of
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    those used in previous years, and I am delighted that that is the case. The way to stop the use of plastic baton rounds is for young hooligans to be encouraged not to use petrol bombs.
    Mr. Adley: Is my right hon. Friend aware that the House will be grateful to him for reminding us why the security forces have to use baton rounds—because of the terror and intimidation? Is it not a great credit to the security forces that they can carry out their duties when any other country's security forces, faced with this problem, would use not baton rounds but live bullets?
    Mr. Prior: It is a constant source of wonderment and admiration that, in the light of enormous provocation, the Royal Ulster Constabulary and our forces in Northern Ireland behave in the manner they do. We should not underestimate what would happen if our forces in Northern Ireland were not as efficient, professional and impartial as they now are.

    Political Parties (Discussions)
    Mr. Canavanasked the Secretary of State for Northern Ireland what plans he has for further discussions with political parties in Ireland.
    Mr. Prior: I keep in touch with representatives of the constitutional parties in Northern Ireland, although I have no specific plans at present for formal discussions with them. As I said in my reply to a question by the hon. Member for Sheffield, Hillsborough (Mr. Flannery) on 12 May 1983, I am also happy to explain Government policy to representatives of constitutional parties from the Republic of Ireland and to hear their views.
    Mr. Canavan: When will the Government resort to common sense and try to organise a constitutional conference of political representatives on an all-Ireland basis, along the lines of the Lancaster House conference on Zimbabwe, to work out a new constitution for an independent, united Ireland so that the people of Ireland can decide their own destiny without British interference?
    Mr. Prior: I regard such questions as being about as mischievous as they can possibly be.

    United States of America (Convicted Terrorists)
    Mr. Adleyasked the Secretary of State for Northern Ireland how many people convicted of terrorist offences in Northern Ireland are believed to have taken refuge in the United States of America; and if he will make a statement.
    Mr. Scott: One person convicted of a terrorist-type offence in Northern Ireland is known to have taken refuge in the United States, and proceedings have been started to extradite him.
    Mr. Adley: Has my hon. Friend noticed the partiality with which the United States courts seem to interpret the phrase "political crimes"? Has he observed that whenever the Israeli Government want the extradition of somebody arrested on a criminal charge that person is always returned, but when Her Majesty's Government make the same request the courts seem frequently to find excuses for not doing so? Will my hon. Friend bring this discrepancy to the attention of the American Government, through the Foreign Office?
    Mr. Scott: It is not for me to comment on the decisions of courts in the United States, or any other country. I am satisfied that the authorities in the United States act in accordance with the extradition treaty between our two countries.

  PRIME MINISTER

    Engagements
    Mr. Parryasked the Prime Minister if she will list her official engagements for Thursday 21 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. This evening I am attending a dinner given by the British Jewish community to pay tribute to Mr. Shlomo Argov.
    Mr. Parry: Will the Prime Minister spell out where the further proposed £5 million cuts are to be made? Is she aware that if they are to be made in education, social services and housing, that could lead to further social disorder? I challenge the Prime Minister to pay an early visit to Liverpool to see at first hand what effect her policies are having—or has she not got the guts to make such a visit?
    The Prime Minister: We have decided, as I said on Tuesday, to stick to the public planned totals of expenditure for this year, next year and the succeeding years. It was on those totals that we fought the election. As to Liverpool, not all is bad on Merseyside. Cammell Laird has won an order for an accommodation rig for Morecambe Bay, Vauxhall has announced the introduction of double shift working in Ellesmere Port, General Motors' AC Delco plant in Kirkby recently announced a large order for the United States, Kodak has recently invested £10 million in Knowsley and there have been announcements of substantial investment by Higsons Brewery, Shell and Ford among others. I am aware that the hon. Gentleman does not like good news, but that is good news.
    Mr. Foot: Can the right hon. Lady add to her remarks by telling us more about Merseyside? What is the figure for the increase in unemployment on Merseyside since she took office in May 1979? Also, has she seen reports of suggestions by Sir Terence Beckett of the CBI that jobs in the public services should be cut by 360,000 next year, and does she agree with that?
    The Prime Minister: I cannot give figures for specific areas. When we came into office unemployment was about 1·3 million and it is now about 3·1 million. If the right hon. Gentleman wants figures for a particular travel-to-work area we can give them to him. The CBI is correct in expecting the Government to keep strict control on public spending, especially as every penny piece of public spending eventually comes from the private sector, and the greater the public spending, the greater the burden upon its back. With regard to the numbers employed in the public sector, the CBI is right in expecting us to be as efficient in the use of our manpower as it is expected to be in the use of its.
    Mr. Foot: in that case, can the Prime Minister tell us how much she thinks the cut of 360,000 in public service
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    numbers proposed by Sir Terence Beckett would cost the Exchequer, and what her reckoning is of how much this would cost in unemployment pay and lost taxes? If she agrees with Sir Terence's proposals, does she also agree with the cuts of 130,000 in education and 80,000 in the Health Service? When did she mention that during the general election?
    The Prime Minister: The right hon. Gentleman is very much aware that we have constantly said that we must have efficient use of manpower throughout the whole of the public service. If the right hon. Gentleman cares to look at the published figures he will see that between 1960 and now the numbers employed by central Government have gone up very considerably—indeed, by a full 20 per cent. over that period.
    Mr. Foot: Will the right hon. Lady tell us clearly whether she agrees with Sir Terence Beckett's proposed 80,000 cuts in the number of people employed in the Health Service?
    The Prime Minister: I have not seen the full details of the specific cuts that he is recommending. I am proud that under this Government the Civil Service is down to its lowest numbers for 15 years. The right hon. Gentleman will know that last February we announced a management review of the National Health Service. We should be careful in the way in which we use taxpayers' money and we should have maximum efficiency in management. I note that the right hon. Gentleman does not want either. He wants extravagance, inefficiency, high taxation and high costs.
    Mr. Neil Thorneasked the Prime Minister if she will list her official engagements for Thursday 21 July.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Thorne: Will my right hon. Friend take time to consider the recent CBI remarks that excessive Government expenditure is likely to lead to higher taxation and higher interest rates and that will inevitably lead to the bankrupting of a substantial number of firms and further unemployment?
    The Prime Minister: Yes. Excessive public expenditure has to be borne by industry and commerce. Therefore, we must be careful to keep down the total amount of public expenditure, otherwise taxation will go up. It was the previous Labour Government who put the national insurance surcharge on industry and commerce. It was this Government, by virtue of their good financial management, who managed to take £2 billion from the taxation of industry and commerce.
    Mr. Beith: If the Prime Minister is so convinced that the CBI is right, what is her response to the other side of its argument, that there should be more Government spending on capital projects of the kind that generates employment in private industry?
    The Prime Minister: The two points are not incompatible. As the hon. Gentleman will be well aware, I have said many times from this Dispatch Box that within the planned total of Government expenditure it would in many ways be better if we allocated a larger proportion to capital expenditure. But that requires cutting down on current expenditure and when it comes to securing such reductions few people will agree them. Therefore,

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    increased capital expenditure includes an increased total expenditure, which again would put an extra burden on industry.
    Mr. Rippon: To save public expenditure will the Prime Minister find time today to abolish the Review Body on Top Salaries, if it has not already had the good sense to resign?
    The Prime Minister: The Review Body on Top Salaries looks at a number of salary scales other than those of Members of Parliament and Ministers, and those other people would prefer the review body to continue its work.
    Mr. Dormandasked the Prime Minister if she will list her official engagements for 21 July.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Dormand: Has the Prime Minister given consideration this week to the message that came loud and clear from the magnificent Durham miners' centenary gala, which was held last Saturday, to the effect that the closure of pits on economic grounds alone will be fiercely resisted throughout the British coalfields? When will the right hon. Lady realise the devastation that is caused to mining communities by such closures, particularly when her Government do not provide alternative employment? Finally, will the right hon. Lady now dismiss Mr. Ian MacGregor before he starts his butchery, which will cause such social unrest in Britain?
    The Prime Minister: The amount to be found by taxpayers through the external financing limit for coal this year is in excess of £1 billion. That is in addition to the money that they have to pay for coal and electricity. Under "Plan for Coal", which was published in 1974, it was assumed that on average 3 million to 4 million tonnes of exhausted capacity would be closed every year. In fact, closures have averaged just over 1 million tonnes a year. It was assumed that there would be substantial investment in coal and under this Government investment in the coal industry has amounted to more than £3 billion. So the investment programme has been in excess of that contained in Labour's "Plan for Coal", although the closures have not.
    Sir William Clark: Does my right hon. Friend agree that it is essential to keep strict control of public expenditure, because the previous Labour Government's failure to maintain strict control on Government expenditure meant that we had to go cap in hand to the IMF?
    The Prime Minister: Yes, I agree totally with my hon. Friend. It is necessary to keep strict control of public expenditure, otherwise we shall have to resort either to excessive borrowing, in which case interest rates will rise and the recovery will be aborted, or to much higher taxation, both on people and industry. Both would be bad.
    Ms. Harman: Bearing in mind that the school summer holidays begin tomorrow, is the Prime Minister concerned that there is no comprehensive public provision to care for and entertain children during the school holidays, particularly as most parents have to work to make ends meet? Does she not think that it is a scandalous gap in public services, about which the Government should do something?
    The Prime Minister: No. I do not believe that it is up to the Government to provide comprehensive care for school children during school holidays. It is up to local authorities to see that the maximum use is made of buildings, playing fields and swimming pools during the recess and to work with parents and teachers to that end.
    Mr. Tim Smithasked the Prime Minister if she will list her official engagements for Thursday 21 July.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Smith: Has my right hon. Friend seen the reply that was given yesterday by her right hon. Friend the Secretary of State for Trade and Industry in which he said that he intended during this Parliament to privatise British Telecom, the British Steel Corporation, Rolls-Royce and other industries under his Department? Given the benefit that will accrue to the taxpayer and the consumer from that programme, will my right hon. Friend ensure that it is implemented as expeditiously as possible?
    The Prime Minister: Yes, we shall implement that programme as quickly as we can, bearing in mind that in some cases we have to get legislation through the House and that we must have regard to the speed at which one places those organisations on the market. It is much better for Britain to have less nationalised industry and to put more in the private sector. It is a better bargain for the consumer and it means that industry can obtain its investment from the market instead of having to rely upon Government sources.
    Mr. Loyden: Does the Prime Minister recognise that her Government's policies have resulted in the doubling of unemployment nationally and that in some areas on Merseyside more than 90 per cent. of the young people are without jobs? When will she realise that such unemployment is crippling individuals and decimating families? What figure will unemployment have to reach before she recognises that the Government's policies are contributing massively to unemployment?
    Mr. Speaker: Order. To put the record straight, that was a supplementary to question No. Q6.
    The Prime Minister: The only way to create more jobs is to create goods and services which people will purchase in competition with the goods and services which they can purchase from overseas. For that purpose the Government need to keep industry's cost down, provide tax incentives that will encourage small businesses and the products of new technology, together with a research and development programme that speeds up the bringing of new products to the market. That is the Government's policy and programme and it is far more likely to produce jobs in future than any policy of Labour Members.
    Mr. Lawrence: Does my right hon. Friend welcome the public conversion of the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) to the Conservative policies for the sale of council houses, membership of the European Community and multilateral disarmament? Does she agree that it would have been a darned sight better had he said that to the electorate before rather than after the election?
    The Prime Minister: I welcome the conversion of anyone to the sale of council houses, membership of the EC—upon which many jobs depend—and multilateral

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    disarmament, which provides for the security of Britain. I note that a number of Opposition Members are very dissatisfied with both the campaign that they fought and the organisation. If they are dissatisfied with the campaign,they have only themselves to blame.
    Mr. Dalyell: On a point of order, Mr. Speaker. How can the House be protected from long answers by the Prime Minister?
    Mr. Speaker: There are not only long answers but long questions.

Business of the House
3.31 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 25 JULY — Motion on the Summer Adjournment.
Proceedings on the Consolidated Fund (Appropriation) Bill.
TUESDAY 26 JULY—Until about 7 o'clock, motions on the Rate Support Grant Supplementary Report (England) 1983–84, and the Supplementary Report (England) (No. 3) 1981–82.
Afterwards, motions on the Welsh Rate Support Grant Supplementary (No. 3) Report 1981–82 and on the Welsh Rate Support Grant Supplementary Report 1983–84.
Motions on Members' pay and allowances and on the Ministerial and Other Salaries Order.
WEDNESDAY 27 JULY—Until 10 o'clock, a debate on orders and regulations on social security uprating of benefits, and on the Pensioners' Lump Sum Payments Order.
Afterwards, motions relating to housing benefit regulations and equal treatment in social security benefits. The relevant orders will be listed in the Official Report.
THURSDAY 28 JULY—Motions on the code of Local Government Audit Practice for England and Wales, and on the Traffic Areas (Reorganisation) (No. 2) Order.
FRIDAY 29 JULY—It will be proposed that the House should rise for the summer Adjournment until Monday 24 October.
Mr. Foot: As legislation on the housing benefits regulations which became law more than a year ago has not yet been fully implemented in many parts of the country, would it not be better to have a general debate on the question rather than debating particular regulations, which is not the best way to discuss the general principles involved? I hope that the right hon. Gentleman will consider that possibility.
Because of the uncertainty created by the Prime Minister's replies earlier this week about whether the Office of Fair Trading's case against the restrictive practice of the Stock Exchange is to be allowed to go ahead or to be blocked by the Government at the City's behest or requirement, will the right hon. Gentleman arrange for a short debate next week on that subject so that the House may give its views on what is obviously—no one can deny it—an extremely important question?
Even at this late stage, will the right hon. Gentleman consider afresh the proposal I put to him a couple of weeks ago for a debate on the Government's plans for public expenditure cuts? The Prime Minister pretended that there will not be cuts, but I do not suppose that that was the mood in which the Cabinet discussed the issue this morning. Will the right hon. Gentleman arrange for a debate or, at least, suggest that there should be a statement from the Chancellor of the Exchequer before we rise for the recess?
Mr. Biffen: I shall take the right hon. Gentleman's points in reverse order. If he is still anxious to press for
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a debate on the public expenditure announcement by my right hon. Friend the Chancellor of the Exchequer a couple of weeks ago, we can pursue that through the usual channels.
On the right hon. Gentleman's second point about the Stock Exchange and its status with the Office of Fair Trading's inquiry, I shall draw his remarks to the attention of my right hon. Friend the Secretary of State for Trade and Industry who is fully aware of the significance of the problem.
I shall bear in mind the right hon. Gentleman's suggestion of a general debate, followed by the votes, on the social security rerating of benefits. We can consider that through the usual channels.
Sir Hugh Fraser: Can my right hon. Friend assure the House that the instruments to be debated on Tuesday will reflect precisely the various decisions of the House on Members' pay? Can those instruments be adjusted or must they remain in accordance with the motion passed by the House on Wednesday morning?
Mr. Biffen: I assure my right hon. Friend that it is the Government's intention that the order to be tabled on Tuesday on Members' pay will reflect the decision of the House. He will understand that having reached a decision there must be some assessment. I am happy to discuss that matter with him. The order is not amendable.
Mr. Frank Dobson: Will the Leader of the House find time for an early debate on the reduction in standards in local authority schools in England recently revealed in Her Majesty's inspectors' report before there are any further damaging cuts in education expenditure that would make the position worse?
Mr. Biffen: There is clearly no scope for such a debate in the business that has been announced for next week. I have no doubt that we can return to that topic in the autumn.
Mr. Norman St. John-Stevas: Further to the question asked by my right hon. Friend the Member for Stafford (Sir H. Fraser), will my right hon. Friend make it absolutely clear that the resolution to be proposed will include the modification moved by my right hon. Friend the Member for Stafford and myself on the linkage of Members' pay? That is most important. My right hon. Friend said that the resolution would not be amendable. Surely it would be amendable save in a way that would raise expenditure under it.
Mr. Biffen: The answer to my right hon. Friend's first point is "Yes". I shall consider his second point. As I understand it, the motion is not amendable.
Mr. Dalyell: Will the Leader of the House arrange for a statement to be made to sort out the position between the Minister of State for Defence Procurement, who said that the question of arms sales to Chile was not discussed during the visit of General Matthei, and the Foreign Secretary, who said that it was discussed?
Mr. Biffen: I can offer no prospect of such a statement next week. I shall certainly draw the attention of the Ministers concerned to the hon. Gentleman's point.
Sir Bernard Braine: Has my right hon. Friend observed that, in the very week in which it was announced that the Madrid conference on European

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security and co-operation had agreed on a document that would strengthen human rights in Europe, there were signs of increased violation of human rights in Poland and Czechoslovakia? Will my right hon. Friend give an assurance that before the Government agree to that farcical document the House will have a statement or preferably a debate?
Mr. Biffen: I know that my hon. Friend's point commands great interest in the House. I shall certainly draw the attention of my right hon. and learned Friend the Foreign Secretary to it.
Mr. Jack Straw: Is the Leader of the House aware that there was obvious and widespread anxiety on both sides of the House when he failed to give a direct and categoric answer to the question of the right hon. Member for Stafford (Sir H. Fraser) about the orders due for debate next Tuesday? We recognise that they must be framed in technical language, but will the orders precisely and accurately reflect the substance of the motions that were agreed by the House on Wednesday morning?
Mr. Biffen: I am fully resolved that that should be the case, and I am satisfied that it is the case.
Mr. John Stokes: Will my right hon. Friend give an assurance that the latest proposal of the Commission for Racial Equality will not result in further legislation which might impose additional burdens on English people?
Mr. Biffen: I cannot give the assurance in the terms that it is sought, but I shall report to my right hon. Friend the Secretary of State for Employment the point that my hon. Friend makes.
Mr. Roland Boyes: Will the Leader of the House consider arranging an early debate on the subject of television licences for the elderly which has concerned my constituents before, during and since the election? People who live in sheltered accommodation pay 5p for the licence while people who do not pay the full licence fee.
Mr. Biffen: I cannot promise to find Government time for discussing that subject in the coming week. In any case, it is a matter on which possibly the hon. Gentleman could use the advantage of private Members' time. Perhaps he will be successful in the autumn.
Sir Kenneth Lewis: Will my right hon. Friend give an assurance that we shall not have a replay of what happened on Members' pay on Tuesday night and early Wednesday morning? I was filled then with a nostalgia that I never expected to have. That might have been prevented if the matter had been sorted out by shop stewards on both sides of the House over beer and sandwiches at No. 10 Downing Street.
Mr. Biffen: As I soldiered through the night, I was aware of many sentiments, but I must admit that nostalgia was not one of them. However, I am glad to know that it was in the mixture with much else.
Mr. Robert Kilroy-Silk: As the Government's policy has doubled the number of unemployed in Merseyside, and as there are no jobs for this year's school leavers in my constituency, why shall
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we not have an opportunity to debate unemployment on Merseyside before October? Is it because the Government have nothing to offer the people of that area?
Mr. Biffen: The hon. Gentleman should try his luck at securing an opportunity to speak in the debate on Merseyside which will take place on the Consolidated Fund (Appropriation) Bill on Monday.
Mr. John Wilkinson: May I draw my right hon. Friend's attention to early-day motion 97 on captive nations week?
[That this House wishing to commemorate the twenty-fifth anniversary of the designation by President Eisenhower of the United States of America of the third week in July as Captive Nations week in the United States of America, and recognising the common commitment to the principles of freedom, democracy and self-determination of peoples shared by the United States of America and United Kingdom, urges Her Majesty's Government also to designate officially the third week in July as Captive Nations Week in the United Kingdom as a symbol of the British nation's support for the restoration of the right to self determination, democracy and freedom for the peoples within the Soviet Union and of Eastern Europe behind the Iron Curtain.]
It stands in the names of my right hon. Friend the Member for Blackpool, South (Mr. Blaker), my hon. Friends the Members for Stroud (Sir A. Kershaw), for Bournemouth, East (Mr. Atkinson), for Bexleyheath (Mr. Townsend), for Cardiff, West (Mr. Terlezki) and myself and no fewer than 114 other right hon. and hon. Members. The motion asks that Her Majesty's Government should designate every year the third week in July as captive nations week, as is officially done in the United States, to commemorate those who live without human rights behind the Iron Curtain.
Mr. Biffen: I shall draw the attention of my right hon. and learned Friend the Foreign Secretary to my hon. Friend's point but, as my statement is about next week's business, I can add nothing to it in that context.
Mr. Laurie Pavitt: Has the right hon. Gentleman seen early-day motion 105 standing in my name?
[That this House views with grave concern the standards of residential accommodation provided in some hospitals for nurses; notes that, because of the failure to provide economic rented accommodation during the last four years in inner city areas, there is now a greater demand for residence within hospitals, but that cuts in public expenditure have meant that the upgrading and maintenance of old properties has obtained a very low priority in the allocation of reduced funds and the failure to do routine work has led to living standards which are unacceptable; and therefore urges Her Majesty's Government to make a special central allocation of funds to each regional health authority to provide adequate toilet, bathroom and other facilities, together with equipment which would make a nurse's living standards comparable with that which she would enjoy in her family home.]
It concerns the squalor in which many of our nurses in residence must live. Since I tabled my motion, two other early-day motions have appeared on the Order Paper. Is the right hon. Gentleman aware that there is widespread

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concern in the House that this has come about because of the rundown in repairs over a number of years? Despite the fact that we shall have no time to debate this matter before the summer recess, will the right hon. Gentleman make arrangements for the Minister for Health to make a statement?
Mr. Biffen: As the hon. Gentleman pointed out, his early-day motion is paralleled by two others, which shows the amount of interest there is in this topic. This will be the subject of a debate before the recess to be initiated by the hon. Member for Fife, Central (Mr. Hamilton). I will, of course, draw the attention of my right hon. Friend the Secretary of State for Social Services to the hon. Gentleman's request for a statement.
Sir Frederic Bennett: Reverting to the question asked by my hon. Friend the Member for Castle Point (Sir B. Braine) about the Madrid conference, as it appears unlikely that there will be either a statement or a debate before the recess, will my right hon. Friend reconsider a request that I made earlier that a document should be placed in the Library setting out precisely what, if any, improvements in the observance of human rights have taken place by the signatory power, the Soviet Union, since the last Helsinki conference?
Mr. Biffen: I have said that I shall approach my right hon. and learned Friend the Foreign Secretary on this matter and in so doing I will attach to my representations my hon. Friend's point.
Mr. Greville Janner: In view of the tragic deaths of many British tourists in holiday flats on the Algarve, do the Government propose to make a statement before we adjourn for our own holidays about the dangers for British tourists in that area? If not, may we have a debate on the subject so that those who go there will at least know that they are not running into hideous danger?
Mr. Biffen: No arrangements have been made for either a statement or a debate. I should have thought that the topic had been widely ventilated.
Mr. Robert McCrindle: Is my right hon. Friend aware of the growing anxiety among many people who change their jobs who discover that in the process they lose rights under private pension schemes? I accept that the Government would prefer the pension companies to attend to this matter without the intervention of legislation, but is it not becoming increasingly clear that that is unlikely? If the Government are not ready to introduce legislation, there may well be an argument for having a wide-ranging debate on the subject.
Mr. Biffen: My hon. Friend raises a formidable topic, as I am sure he realises. I shall bear in mind his point about the desirability of a debate, but I must say at once that there is no prospect for it next week. Perhaps we may consider the matter when we return in the autumn.
Mr. Ioan Evans: The Prime Minister has confirmed that the Cabinet were discussing public expenditure cuts today. If we cannot have a debate on the matter next week, may we at least have a statement so that we can go home to our constituencies to tell the people
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what employment benefit and other social service cuts are being considered by the Government? At the same time, may we have a statement on the breakdown of talks in the Common Market today in view of the implications for Britain's contribution to the EC?
Mr. Biffen: On the hon. Gentleman's first point, I cannot reasonably add to what I have already said to the Leader of the Opposition. On the second point, I will consider the desirability of the making of a statement.
Mr. Andrew MacKay: Bearing in mind early-day motion 90 in the name of my hon. Friend the Member for Rutland and Melton (Mr. Latham), and the considerable and rising public concern about crimes of violence, will my right hon. Friend say whether it will be possible to have a debate soon after the House returns in October on increasing the punishments for such crimes?
[That this House notes the result of the Debate on the Death Penalty, and regards it as a final and irrevocable settlement of a great domestic question; looks to the courts to ensure that public outrage at crimes of murder and violence is fully met by severe prison sentences in all cases except where there are exceptional mitigating factors; and calls upon the Home Secretary to review all statutory provisions for sentences for crimes of violence to see whether any more rigorous mandatory provisions should be recommended to Parliament in fresh legislation.]
Mr. Biffen: It will be considered when the House returns in the autumn, but I suggest that, as my hon. Friend takes such a lively and respected interest in this topic, he might use the advantage of private Members' time.
Mr. David Winnick: Does the Leader of the House recognise that there is bound to be a great deal of public concern in our constituencies about public spending cuts? As the subject will be endlessly discussed and speculated about in the press, surely the House of Commons should have a statement before the recess from Ministers, and in particular the Prime Minister. Is the Leader of the House telling us that no statement on the public spending cuts will be made before we break for the recess?
Mr. Biffen: I cannot accept the premise on which that question was postulated. As for a debate on the economy, I said that the matter was for consideration through the usual channels.
Mr. Ivan Lawrence: As it appears that the mass medication of the water supply by the addition of fluoride is as unlawful in England, Wales and Northern Ireland as it has just been held to be in Scotland, should we not have a statement before October about the Government's intention?
Mr. Biffen: I cannot immediately accept my hon. and learned Friend's premise about whether it is lawful, but I will look at the proposition. I can say without hesitation that no provision has been made for such a debate or statement next week.
Mr. Max Madden: A letter has been sent by the Minister of State, Home Office this week to Members of both Houses which undermines Members' rights to make representations on immigration matters. Does the Leader of the House appreciate that, so long as we have the most unfair and unjust immigration laws, it is important that we have the right to make

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representations, especially when hon. Members are unwilling or unable to make those representations in the first instance? Will he arrange for that letter to be withdrawn in the interests of fairness rather than giving Ministers a quiet life from considering representations?
Mr. Biffen: I cannot make a judgment immediately in response to that question, but if the hon. Gentleman would refer the document to me I will consider it.
Mr. Nigel Forman: Is my right hon. Friend aware that it might be helpful to the Government to have an early statement on the whole question of public expenditure and to debate the issue in the first week after we return in the autumn?
Mr. Biffen: I note my hon. Friend's suggestion.
Mr. Dennis Skinner: If the Leader of the House is saying that there will not be a debate on the Cabinet decision this morning to cut public expenditure, so throwing more people out of work and creating more poverty in the land, and if he cannot guarantee that a statement will be made next week, what guarantee can he give that there will be no private briefing sessions during the long summer recess to tell the press what took place this morning? If he will not guarantee that, what assurance can he give that the moles will not begin to operate in the various Government Departments? Is he aware that the only way to stop them is to put locks on the photocopying machines?
Mr. Biffen: I note all that. I reject absolutely and entirely the description of what allegedly happened at public expenditure considerations by the Cabinet. I reiterate what I said to the Leader of the Opposition: if there is a keen desire to have a debate on the economy, that can be considered through the usual channels.
Mr. Robert Adley: I refer my right hon. Friend again to early-day motion 7 which has been signed by more than 200 right hon. and hon. Members in all parts of the House.
[That this House urges Her Majesty's Government immediately to take steps to enable people on holiday to be eligible for postal votes at a General Election.]
Has my right hon. Friend been advised whether the Home Secretary intends to make a statement next week on the subject of postal votes for holidaymakers? Has my right hon. Friend seen, for instance, the postcard registration and absentee ballot request form which is made available by the United States Government to all American citizens? If I give it to him, will he look at it, pass it on to the Home Secretary and tell him that he, the Leader of the House, is getting fed up will all my questions and would he, the Home Secretary, please put my right hon. Friend out of his misery?
Mr. Biffen: I am of such a good natured disposition that I actually enjoy my hon. Friend's questions. However, that does not in any sense vitiate my view that the point he raises is profoundly important—that is, the need to get reform in our electoral arrangements—and I believe that the Home Secretary is fully apprised of the matter. He has no plans to make a statement in the coming week, but I do not believe that my hon. Friend will be dissatisfied when we consider the record by the end of this Parliament.
Mr. Robert Parry: Will the Leader of the House ask the Secretary of State for Social
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Services to make a statement before the recess on allegations of high-powered American salesmen employed in private hospitals selling blood from the blood bank? I tabled questions on Monday of this week, but in view of the public disquiet and the concern of NUPE and ASTMS, which are involved in the National Health Service, will the right hon. Gentleman try to persuade the Secretary of State to make a statement on the Floor of the House?
Mr. Biffen: I shall refer to my right hon. Friend the anxieties which the hon. Gentleman expresses.
Mr. Harry Greenway: Is my right hon. Friend aware of the concern of many inner London parents about Left-wing masters at county hall sending out many Marxist-dominated curriculum documents, without the support of the professional staff at county hall, for consideration and teaching in schools? Is he further aware that they have set up a unit costing the ratepayers about £130,000 a year to fight for the continued survival of the present political and financial structure of the ILEA? Will he ask the Secretary of State for Education and Science to make a statement as soon as possible?
Mr. Biffen: I shall refer to the Secretary of State for Education and Science the point that much concerns my hon. Friend and which, I am sure, concerns many others.
Mr. Neil Thorne: Will my right hon. Friend confirm that the draft Civil Defence (General Local Authority Functions) Regulations 1983, which were due to be considered by a Standing Committee on Statutory Instruments on Tuesday, will come into force on 9 August? If not, will he please find time for a debate on the matter next week or, failing that, immediately after our return in October?
Mr. Biffen: Certainly.
Mrs. Renée Short: Is the Leader of the House aware that there is great anxiety about the mean, philistine, penny-pinching attitude of the Government towards the arts? First, a blow was struck against the theatre museum, which caused great alarm and consternation, and now there is an indication that the Arts Council grant is to be cut by almost £2 million, a large proportion of its total grant. If that happens, a large number of clients who are dependent on Arts Council support to continue to provide the entertainment that our people need and enjoy will have to go, thus creating more unemployment. What does the right hon. Gentleman intend to do to give us an opportunity to debate the matter before the House rises for the recess?
Mr. Biffen: I suggest that this is pre-eminently a circumstance in which the hon. Lady can herself pursue the campaign. I regret that no time will be available for her to do this next week, but I wish her luck in the autumn.
Mr. John Silkin: A decision by the Secretary of State for Defence on the ALARM system is overdue. If that decision is reached between now and the rising of the House, will the Leader of the House undertake that it will be given by oral statement to the House and not by written answer?
Mr. Biffen: I recognise the importance of the decision, and I shall examine most sympathetically the point that the right hon. Gentleman makes.
[Orders and regulations for debate on Wednesday 27 July:
Until 10 o'clock—
Social Security Benefits Up-rating Order 1983
Supplementary Benefit (Up-rating) Regulations 1983
Child Benefit (Up-rating) Regulations 1983
Family Income Supplement (Computation) Regulations 1983
Housing Benefits (Increase of Needs Allowances) Regulations 1983
Social Security (General Benefit) amendment Regulations 1983
Supplementary Benefit (Requirements and Single Payments) Amendment Regulations 1983
Pensioners' Lump Sum Payments Order 1983
Afterwards, Prayers—
Housing Benefit Amendment Regulations 1983
Housing Benefits (Transitional) Amendment (No. 2) Regulations 1983
Supplementary Benefit (Miscellaneous Amendments) Regulations 1983
Social Security Benefit (Dependency) Amendment Regulations 1983
Supplementary Benefit (Equal Treatment) Regulations 1983
Family Income Supplements (Miscellaneous Amendments) Regulations 1983]
Mr. Speaker: I have two brief statements to make. The first is about the tabling of questions today. The announcement of the proposed date of the return after the summer recess means that the Table Office can now receive questions for oral answer during the first week after the recess. Questions must normally be accepted by 4 o'clock to be included in the random numbering process. For the convenience of hon. Members, I will extend that time today until 6 o'clock.
Secondly, I remind hon. Members that on the motion for the Adjournment of the House on Friday 29 July, up to eight hon. Members may raise with Ministers subjects of their own choice. Applications should reach my office by 10 pm on Monday next. A ballot will he held on Tuesday morning and the result made known as soon as possible thereafter.
Mr. Tam Dalyell: On a point of order, Mr. Speaker. Your predecessor, Mr. Speaker Thomas, said at various stages that he would consider the question of substantial questions to the Prime Minister rather than open questions. I was wondering whether, at an early stage during your Speakership, you would be reflecting on the issues involved in open questions and questions of substance.
Mr. Speaker: The hon. Member may be assured that I am reflecting on all kinds of things in the early stages of my Speakership. He raises a very important matter and it is certainly one to which I shall give consideration, but it is difficult for the Chair to make any absolute rules on that sort of issue.

Rates (Glasgow District)
3.59 pm
The Secretary of State for Scotland (Mr. George Younger): I beg to move,
That the Rate Reduction (Glasgow District) 1983–84 Report, which was laid before this House on 7th July, be approved.
It is worthwhile at the outset of the debate to remind ourselves that we are considering whether the total estimated expenses of Glasgow district council as proposed in the report are excessive and unreasonable. It is to that question, and to no other, that I have applied my mind in presenting this report, and in doing so I have taken into account all the representations that have been made to me about this expenditure.
Before turning to the detail of the report, I should like to say a brief general word about why we need to have such reports and to answer the question as to why the Government cannot just ignore what local authorities spend. It would be much easier for us all if we could, but there are overwhelming reasons why no Government could control the economy properly if they allowed local authority expenditure to take off.
Local government spending is undeniably part of public spending. It is funded partly by local rates and partly by general taxation. If it increases, there are fewer resources available for other public expenditure programmes, and private industry, which earns our living abroad. The Scottish Office spending programme is a clear example of these points. Over half of the money spent on the Scottish Office spending programme is spent not by me but by local authorities. No one who wants to be taken seriously can sensibly believe that any Secretary of State could abandon all control over such a large part of his spending. We do not, therefore, take powers out of any desire to undermine local democracy, despite what is said in an article in The Times today.
It is important that local government and locally elected representatives should determine local priorities. However, central and local government cannot work in isolation. It is an essential part of the machinery of government that they should co-operate. Central government have been democratically elected, with the responsibility for pursuing national objectives, including economic objectives. Local government have been democratically elected to pursue local objectives, but these must be pursued within the framework of national objectives set by Government. There cannot be any question of local government expenditure being left out of accounts when the Government consider their public expenditure policies.
There is nothing new about this. All Governments, including Labour, have felt it necessary to take steps to control local authority expenditure. For instance, in 1975 the noble Lord Ross of Marnock said,
"restraint on spending by local authorities in the years ahead has to be of a stringency hitherto unheard of, certainly in recent times. That is necessary in the interests both of Government and of ratepayers. We have to try to keep down the level of expenditure and the level of the rates."—[Official Report, 15 December 1975; Vol. 902, c. 1100.]
Lord Ross was a predecessor of mine in office, and the right hon. Member for Glasgow, Govan (Mr. Millan) was Minister of State, Scottish Office when those words where spoken.
The largest reduction in local authority expenditure since reorganisation was achieved not by a Conservative
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Government but by the Labour Government in the financial year 1977–78. No Government can afford to ignore the level of local authority expenditure when considering their overall public expenditure policies. That ought to be common ground between the two sides.
When we took office local authority expenditure was increasing. This had obvious implications for the national economy. I had no option but to call for the co-operation of local authorities to reduce their expenditure, in the interests of ratepayers and the national economy. Some authorities made great efforts to co-operate. However, a few did the opposite and continued to budget for a high and increasing level of spending. In that case, apart from exhortation, I had only one means at my disposal to try to control local government spending — alteration of the level of rate support grant. I was not the first to use this device. The largest reduction in the RSG percentage—of four points—was made in 1977–78 by none other than the right hon. Member for Govan. The abatement in 1976–77—again under his leadership—leading to a 3 per cent. reduction in local authority expenditure was also the Labour party's policy. That was the first time that those powers had been used.
Any such general reduction in grant is allocated among authorities according to their original share of rate support grant, not the amount of their overspending. For this reason, we took powers in the Local Government (Miscellaneous Provisions) (Scotland) Act 1981 to make selective reductions of grant when I was satisfied that an authority's budgeted expenditure was excessive and unreasonable.
The object of the powers was to take action before expenditure took place and to concentrate action on those authorities principally responsible for the overspending. However, powers to take selective action against individual authorities that overspent were not new and not invented by me and this Government. They were a repeat of the powers contained in the Local Government (Scotland) Act 1966 when several right hon. and hon. Members opposite were in Government. They positively supported such powers then. Why do they not so support them now?
The only difference today is that the powers can be exercised at the beginning of the financial year instead of the end. The Government can now ensure that money saved is definitely returned to the ratepayers. This year is the first time that I can require rate reductions. Having initiated action against five authorities, I am now continuing action against four.
When, in letters dated 5 May, I initiated action against five authorities under section 5 of the Local Government (Scotland) Act 1966, the House was told in a written answer on 6 May, at about the same time as the authorities were receiving their letters.
The five authorities involved — Lothian regional council, Shetland Islands council, Kirkcaldy, Stirling and Glasgow district councils — were invited to make representations to me.
All five authorities made representations and either I or my hon. Friend the Minister responsible for home affairs and the environment met each of the five authorities to discuss their representations. I made it clear that I had an open mind and would give careful consideration to such representations. In the light of those representations and discussions, I decided to modify my proposals in every

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case. No one can seriously maintain that I did not listen to the points made and, indeed, in the case of Shetland, I decided to take no further action.
Mr. Jim Craigen: What was the secret of the fifth authority, that the Minister decided to drop action against it, but to continue against the other four?
Mr. Younger: Those consultations were conducted in a genuine spirit of listening to the representations. There was a case for initiating action against the Shetland Islands council on the basis of the figures it presented. However, as in all cases, I took its representations fully into account and considered them. There are a large number of unique circumstances arising from North sea oil which carry with them special financial consequences. For instance, roads have been subject to volumes of traffic of a type for which they were never designed— heavy lorries involved in construction of oil facilities. There was an almost unique expansion of the population of about 20 per cent. between 1978 and 1981. Large population increases followed by large decreases caused immense problems. There was considerable uncertainty about school rolls which led to added costs and extra provisions. For all those reasons —I hope the hon. Gentleman will agree with me—a strong case was made—
Mr. Robin Cook rose—
Mr. Younger: —that, with Shetland, there were peculiar and remarkable circumstances. I should have thought that the hon. Member for Glasgow, Maryhill (Mr. Craigen) would be criticising me bitterly had I ignored the representations and refused to make any change.
Mr. Cook rose—
Mr. Craigen rose—
Mr. Deputy Speaker (Mr. Paul Dean): Order. The Secretary of State is not giving way.
Mr. Younger: I should proceed. I have given way to the hon. Member for Maryhill once.
Mr. Deputy Speaker: Order. Perhaps I should rephrase my remark. Is the Secretary of State giving way?
Mr. Craigen: I am grateful. The Secretary of State asked me whether I would agree with him. I was asking the question because I assumed that the Scottish Office would have had all those relevant facts before the decision was taken to drop Shetland. After all, the Scottish Office drew up the guidelines.
Mr. Younger: I am sorry that the hon. Gentleman does not agree with me. I presume, therefore, that the hon. Gentleman would not, like me, have abandoned action against Shetland but would have proceeded with it. The four authorities against which action continues were told in the letter of 29 June that I proposed to limit the rate reduction initially proposed and the authorities — [Interruption]—
Mr. Deputy Speaker: Order. The hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) must not seek to override what the Minister is saying.
Mr. George Foulkes: The Minister may not have heard me.
Mr. Younger: The authorities were told that I proposed to limit the rate reduction initially proposed and the authorities were asked whether they are now prepared to make a voluntary rate reduction of that amount under section 108A of the Local Government (Scotland) Act 1973. The authorities were asked to let me know by 6 July whether they were prepared to make such a voluntary rate reduction. Unfortunately, none of them were prepared to make a voluntary rate reduction of the level proposed by me, and I therefore laid on 7 July the necessary reports, seeking the approval of the House to the rate reductions that I had proposed. I personally much regret that the authorities have refused to co-operate in this way, because it prolongs the uncertainty for their ratepayers and delays the point at which those ratepayers can receive the refunds that we consider are both justifiable and necessary.
I turn to the case of Glasgow district council. Much has been said during the past few weeks about so-called "Scottish Office errors" over Glasgow's figures, and I shall deal with this matter first.
All local authorities have to submit by the middle of March each year a form giving information about their budget for the following financial year. This form has to be certified as correct by the authority. Glasgow's form, as submitted, was, to put it at its best, somewhat confusing. It included a sum of £8 million for unallocated contingencies, without any explanation. In view of the size of the sum, the Scottish Office made inquiries of Glasgow. Those revealed that the sum was an unallocated contingency which should have been shown elsewhere, and none of it could have been taken into account as part of Glasgow's relevant expenditure for comparison against guidelines. Once the Scottish Office had established that, the £8 million was removed from Glasgow's figures for purposes of guideline comparison and its guideline excess adjusted accordingly. The £8 million played no part at any time in our consideration of Glasgow's expenditure for selective action. If there was any mistake, it was Glasgow's, for failing to present its figures properly.
The second so-called error was over the £4 million included by Glasgow in its certified return on the line for housing improvement grants. This line is used by all other authorities — and up to this year has been used by Glasgow itself—only for the expenditure involved in administering housing improvement grants and the loans charges, but not for the grants themselves. This year, Glasgow decided to enter in this line expenditure on the grants themselves. It was bound to cause confusion if Glasgow chose, without explanation, to change its practice in providing information. The first time that it was drawn to my attention was by a representative of Glasgow district at a meeting between me and representatives of the Convention of Scottish Local Authorities. The purpose of such meetings is, of course, to discuss local authority financial matters in general, not detailed points of this kind.
Once again, the term "error" is quite inappropriate. When the true purpose of the £4 million, shown against "housing improvement grants", was explained at the meeting between the Minister with responsibility for home affairs and the environment and representatives of Glasgow district council on 20 June, it was accepted that the £4 million should be regarded as housing expenditure and excluded from the council's expenditure in any consideration of selective action.
Mr. Bruce Millan: Was not the £4 million drawn specifically to the attention of the Scottish Office in April, not June?
Mr. Younger: No. It first was brought to our attention, as a new point, by a representative of Glasgow district at the meeting with COSLA that I attended.
Mr. Millan: With great respect to the Minister, the £4 million was brought to the attention of the Secretary of State's office very much earlier than June. In fact, it was brought to the attention of officials in the Scottish Office on 22 April. Does the right hon. Gentleman deny that?
Mr. Younger: I do not know what document the right hon. Gentleman is referring to. I am working quite properly, on the form that was presented to me by Glasgow district council. That is a perfectly fair starting point, which the right hon. Gentleman cannot deny, starting from the form that was presented by Glasgow district council, putting the best case that it could.
Mr. Millan: I shall deal with the matter in my own speech, but the form was presented in March and it was drawn to the attention of the Secretary of State's officials on 22 April. The right hon. Gentleman cannot deny that.
Mr. Younger: It is no good the right hon. Gentleman saying that, because the first time that it was drawn to my attention or that of my officials was on the occasion that I mentioned. That is the information that I have.
Much has been said about the consequences of removing the £4 million, now recognised as housing expenditure, from Glasgow's relevant expenditure. Now that it is excluded from comparisons, Glasgow's excess over guidelines comes down from 36 per cent. to 30 per cent. — still substantial — and its expenditure per head comes down from £112 to £107, still the highest of any district council and well above the average of its comparable districts at £67. The adjustment has been fully taken into account in the consideration of the lower level of reduction to 3p, set out in the report.
Glasgow has made much of the difficulty of comparing it with other authorities, but one is entitled to ask why its expenditure per head is so high compared with other authorities—Edinburgh at £67 a head, Aberdeen at £67, Dundee at £62, while Glasgow is £107 per head. That clear difference cannot be laughed off.
Let us now turn to the rate reduction which I am proposing in this case. I took careful note of Glasgow's representations and modified my original proposal of a rate reduction of 5p to 3p. At the meeting with my hon. Friend the Minister who is responsible for home affairs and the environment, the representatives of the council accepted that, as a result of the extra capital allocation that I made for environmental improvement, there would be savings of at least £3 million on their revenue budget. Glasgow accepted that that would mean that at least 1·5p could be returned to the ratepayers. Indeed, Glasgow suggested that it could be returned as part of its 1984–85 budget. As for the remaining 1·5p, I find it hard to believe that Glasgow cannot make the savings which that represents — £3 million. In terms of expenditure, it is about 3 per cent. of its budget. It is not for me to suggest where those savings might be made. However, I doubt whether the various organisations which the district council has spent money writing to and encouraging to write to me about a "£10 million reduction in expenditure" will suffer as they have
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been led to expect by some of the propaganda. Glasgow's high expenditure per head, compared with other authorities and measured against the performance of other authorities against guidelines, leaves me in no doubt that its rates must come down, especially as the council itself accepts that half of the reduction I propose is ready and waiting to go back to the ratepayers.
I have outlined the main reasons why it is vital to restrain local government spending where it is excessive and unreasonable, and I have made out the detailed case against Glasgow. We shall come to the detailed cases against the others later this evening.
Before I end, I want to say a brief word about the role of the official Opposition in this matter. I have already described briefly how the Labour Government imposed the biggest ever reduction in rate support grant percentage and the biggest ever reduction in expenditure on manpower in 1976–77. It is true that they did it only under duress, with the IMF breathing down their neck, but the point is that they did it. There was no talk then of"destroying local democracy". There were no cries of the "destruction of local democracy". Local authorities, particularly Conservative-controlled authorities, showed great responsibility in doing all that they could to help the right hon. Gentleman to reach his target of cuts.
Indeed, my attention was drawn to an interesting report on the views of local government in this connection. The report gives the view of a local government spokesman, who said:
"We have just got the feeling that the Government are being rather obdurate in their attitude and, as someone remarked, it is about time that the Government should start restoring 'local' into government as far as the Scottish scene is concerned."
The report went on:
"The Convention's concern reflects the deterioration in the good relations local authorities had until lately with the Scottish Office, Councils feel they have done everything in their power to reduce substantially expenditure this year, yet the Scottish Office have accused them of over-budgeting and have suggested that councils might consider re-.examining their estimates".
Those are not my words but the words of Mr. George Sharp, the president of COSLA, on 24 April 1976. I hope that that quotation lays once and for all the idea that the Labour party has a monopoly of views on the subject because it had to face the same problems when in office.
Mr. Tom Clarke: George Sharp made that comment when he was president of COSLA and I was vice-president. Things have deteriorated since. If the Secretary of State is correct in his version of what happened, does that not make it more difficult for local authorities to impose still more cuts?
Mr. Younger: That is a helpful intervention. It is helpful to have the vice-president to add his imprimatur to that quotation. The hon. Gentleman is right. I have sympathy with anyone who has to try to reduce spending, because it is difficult to do. As anyone who has had to tackle the problem knows, those who manage their affairs well are good at it. It is part of the good management which everyone must practise.
When the right hon. Member for Govan was in charge he was given remarkable assistance. Instead of crying, "Destruction of local services", local authorities, particularly those that were Conservative-controlled, showed great responsibility and did all that they could to help the right hon. Gentleman to reach his target for cuts. Only a small number of Labour-controlled authorities did not co-operate and paid no attention—even to him.
Mr. Gordon Wilson: The Secretary of State has used the words "responsibility" and "sympathy". Will he confirm that because of his responsibility and sympathy he refused to accept any more public expenditure cuts at this morning's Cabinet meeting?
Mr. Younger: I have no intention of giving an account of what may or may not have taken place at Cabinet this morning. If hon. Members think that I am just talking without taking action they may like to know that in my time at the Scottish Office we have had a tough time trying to reduce spending and manpower. The Scottish Office staff has been reduced by more than 1,000 in that time. That is extremely difficult and I have genuine sympathy with those who have to try to reduce spending.
Mr. John Maxton: How has the right hon. Gentleman succeeded in reducing expenditure and will he compare that with the local authority cuts that he is imposing today?
Mr. Younger: I knew that it was a good idea to give way to the hon. Member for Glasgow, Cathcart (Mr. Maxton) because he makes my point. There is no comparison between the manpower reductions.
Because of the background that I have explained I must describe the position taken by the right hon. Member for Govan and his hon. Friends now as quite irresponsible and thoroughly discreditable. They are deliberately giving the impression to local authorities today that if a Labour Government were in power they would allow them to spend whatever they like. I read something to that effect in the Labour party mainfesto.
The Labour party does not accept a reduction in the rate of grant and it does not agree with selective action against local authorities. It takes that line with complete cynicism, knowing that even a Labour Government would have to place limits on overspending and that they did so when last in office. The Labour party should remember that it reduced the rate of RSG by 6·5 per cent. over two years between 1975–76 and 1977–78. We have also reduced it, but by 6·8 per cent. over four years. The comparison is interesting and I hope that the right hon. Member for Govan will address himself to it.—[Interruption.] The right hon. Gentleman is making his usual excellent speech from a sedentary position. They are always his best speeches. They are much better than the speeches that he makes when standing.
The Opposition are acting as we have come to expect, as the permanent Opposition, who know that it will be many years before they have to face the responsibilities of Government—if they ever do.
The Opposition are doing something worse on this occasion. They are trying to use local government to prevent central Government from attaining national economic objectives. They are doomed to failure because no Government can allow such a dangerous challenge to their central strategy. Even though they will fail, their attitude is gravely damaging to the balance between local and central Government. Each has its own task.
Central Government have to run the whole economy and they stand or fall by their success in doing that. Local government has to provide local services under statutes passed by Parliament within the framework of national economic policy. The Labour party, if it has not already
582
lost its self-respect, should be deeply ashamed of what it is doing to damage the essential relationship between central and local government.
Of course, the Opposition try to make out that all this is the fault of the Government alone — that is their natural task as Opposition—but the general public can see one thing very clearly. It can see that the Labour party has no concern at all for the ratepayer. It would gladly let local government spending soar upwards and the burden of rates spiral upwards with it. Everyone in Britain—individuals, families, businesses and industries — is doing their utmost to save money to help our country through these difficult times.
The only people who are not pulling their weight in this great national effort, are a few recalcitrant local authorities aided and abetted by the Opposition.
We are considering only Glasgow district council in this report. I hope that the House will agree that I have made a strong and compelling case to show that its proposed expenditure is excessive and unreasonable and I therefore commend the report to the House.
4.28 pm
Mr. Bruce Millan: I have never heard a speech in the House as full of humbug and hypocrisy as that by the Secretary of State. I shall deal first with the general situation, since this is the first of four debates, and then with the report against Glasgow.
I shall not spend much time on the general argument, but, as I have said on numerous occasions, all Governments have an interest in local authorities and wish to influence their expenditure but this Government have taken unprecedented steps in relation to local authority expenditure. For the first time in the history of local government, central Government have taken powers to control the level of expenditure by individual local authorities. This is the first Government to take powers to override the rate decision-making powers of local authorities and to supersede rate decisions by individual authorities. If local government's power to determine its own level of expenditure and rates is removed, the essential functions of local government are removed, and ultimately local authorities become the agents or creatures of central Government. That is just what the Secretary of State is doing through these four motions.
That is why it is accepted by a much wider body of opinion than that in Scotland alone—as evidenced in the article in today's edition of The Times—that we are dealing not with a simple matter of minor penalties against a few Scottish local authorities, but with the whole constiotutinal relationship between central and local government. The Government—the most centralist of Governments ever known in this country—are attacking the very roots of local democracy. Moreover, we understand that what is happening in Scotland is to happen in England and Wales as well. We are also told that there will be further legislation for Scotland later in the Session.
Therefore, all the Secretary of State's protestations about his interest in local democracy and decision-making are utter humbug. His speech was an insult to the intelligence of hon. Members. The Government's main justification for their actions is that somehow local government expenditure is out of control, so they must have tighter control over local government. However, the reality is entirely different. I shall quote figures given by the Secretary of State himself in the debate on the rate

583
support grant on 17 January 1983. Total relevant expenditure by local authorities in Scotland went up from £2,351 million in real terms in 1978–79 to £2,429 million in 1981–82. That is an increase in real terms of about 3 per cent. over the three years, or about 1 per cent. per year. In 1981–82 local authority expenditure in Scotland fell in real terms compared with 1980–81.
We do not yet have the final figures for 1982–83 with which to make a comparison, but I should be astonished if they did not show something like the same trend as in the previous three years. At most I believe that they will show a real increase in expenditure of about 1 per cent. over the previous year, although they may not even show that. The Secretary of State, in a letter that he sent to some of us yesterday, included a very misleading passage about local authority expenditure in the current year being budgeted to increase in real terms. However, the figures that he gave on 31 March in response to a question by my hon. Friend the Member for Cunninghame, South (Mr. Lambie) show that when the 1982–83 budgets for local authorities in Scotland are compared with the 1983–84 budgets, there is an increase in cash terms of 5 per cent., but in real terms the increase between 1982–83 and 1983–84 is nil.
Therefore, Scottish local authorities have had standstill budgets in 1983–84 compared with 1982–83. At the end of this year I believe that expenditure in real terms will be at a standstill again. It is interesting to compare those modest expenditure increases in the past four or five years with what has happened to rates in Scotland. Of course, those increases have been nothing like modest. Again, I shall use figures that the Secretary of State has given in parliamentary answers.
On 23 December 1982, in response to a question by my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar), it was shown that between 1978–79 and 1982–83 the unfortunate domestic ratepayer in Scotland suffered an increase in rates of 139 per cent. There was an increase in real expenditure in that period of about 4 per cent. and an increase in rates of about 139 per cent. However, the discrepancy between those two figures is easily explained. The increasing rates burden on the shoulders of ratepayers in Scotland — for whom the Secretary of State is constantly weeping crocodile tears—is due to inflation, high interest rates and cuts in Government support to Scottish local authorities. That is why rates have increased so alarmingly in the past few years.
The figures were confirmed in a written answer to my hon. Friend the Member for Glasgow, Central (Mr. McTaggart) on 30 June 1983. The figures—they are the Prime Minister's figures, so I suppose that that gives them additional authority—show that between 1977–78 and 1981–82, the last year for which figures are given, the percentage of local government expenditure in Scotland provided for by central Government fell from 68·8 per cent. to 58·3 per cent.
It is part of the Secretary of State's "triumph" that whereas in 1977–78 Scotland had 68·8 per cent. of its local authority expenditure refunded by central Government compared with 64·5 per cent. for the United Kingdom, under the Secretary of State's stewardship the figures for Scotland in 1981–82 are exactly the same as the United Kingdom's average. Therefore, the advantage that Scotland once enjoyed had completely disappeared by 1981–82. I believe that the 1982–83 figures will show that Scotland is now getting less in grants in percentage terms
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from central Government than the average for Me United Kingdom. The Secretary of State has shamefully betrayed Scotland's interests.
Every time we debate this issue, the Secretary of State trots out the reduction in the rate support grant by the Labour Government in 1977–78. The Labour Government, when they came in in 1974, inherited a rate support grant, on a comparable basis, of 66·5 per cent. In 1975–76 we increased that to 73·5 per cent. in order to give special help to Scottish local authorities to deal with local government reorganisation. In 1976–77, when that reorganisation had largely been adjusted for, we reduced it by 1 per cent., and in the subsequent year we made the reduction of 4 per cent. that the Secretary of State trots out in every rate support grant speech that he makes in the House. That reduced the percentage of grant in that year to 68·5 per cent., which was still 2 per cent. higher than the figure that we inherited from the Tory Government in 1973–74. Therefore, the Secretary of State need not pretend that everything that has happened in the past few years also happened under the Labour Government, and need not quote the reduction in 1977–78 as some sort of justification for his argument. It is utter nonsense. Unless the Secretary of State is even more ignorant of local government finance than I believe him to be, he must know that it is utter nonsense to make such points.
The immediate background to the reports was well laid out in the answer that was given to my hon. Friend the Member for Cunninghame, South on 31 March. That showed that local authorities in Scotland had budgeted for the current year at no less than £253 million over and above the Secretary of State's guidelines. In so doing they had budgeted for a financial standstill. However, they were still £253 million above the guidelines, because the guidelines bore no relation to realities. We told the Secretary of State that the guidelines were nonsense when we debated the rate support grant in January. Of the 65 authorities in Scotland, only three are within the guidelines. As we predicted, the other 62 are above the guidelines. In some instances they are much in excess of them because the guidelines are meaningless.
If Conservative Members represent areas that will not be affected by the penalties, they should not assume that the authorities in their constituencies will not be penalised in the current year. I am sure that within the next few days the Secretary of State will impose a general clawback on Scottish local authorities. Will that happen? If it is to happen, the House will have been shamefully misled on several occasions, not to mention this afternoon.
Mr. Younger: I have frequently said that I think it very likely that there may have to be a general abatement. I have not yet worked out the level of the abatement, but I shall tell the House about it as soon as possible.
Mr. Millan: That will be a change. The clawback for 1982–83 was announced on 28 July 1982, before the House started its summer recess. I am sure that the right hon. Gentleman has another clawback in mind. We ask that it be announced to the House before the start of the summer recess next week. It should not be announced in a way that is convenient to the Government when the House is in recess and is not able to challenge the right hon. Gentleman. Every local authority in Scotland will be penalised by the clawback and the announcement will be

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made very soon. If all the stories that we read in the press about further public expenditure cuts come to pass, we may have a considerable clawback in store for us.
Mr. Barry Henderson: Many local authorities have taken great trouble to keep their expenditure low for a long time. Surely that is a good reason why the few authorities that greatly overspend should not be allowed to get away with that.
Mr. Millan: The hon. Gentleman will be in for a shock when he considers the position not only of the authority that has control in his constituency but of other authorities which have made efforts to control their expenditure. Many authorities in Scotland will be in for a shock.
Local authority expenditure in Scotland has been under control for the past four or five years and it remains under control. It is a falsehood to claim that it is not as a justification for the penalty provisions. I have referred to the figures. If the Secretary of State want to deny or challenge them, he, or one of his junior Ministers, will be able to do so later. All the figures that I have used this afternoon have been provided by the Secretary of State and his Department. They explode the claimed justification for the penalties.
We have repeatedly made it clear that we do not accept that the guidelines are realistic. They should not be used in any circumstances as a basis for penalising individual authorities. In any event, they are drawn up in a strange way, although they used to be formulated in an even stranger way which meant that no one quite knew what factors were taken into account. The Secretary of State calculates what the expenditure need of an individual authority should be in accordance with the factors that go to make up the guidelines. At the end of the day adjustments are made to those calculations. This is an odd way to produce figures that are supposed to give guidance to authorities — they are now more than a guide — on what they can expend in the year to come.
Shetland is unique because it has been budgeted further beyond the guidelines-46 per cent. —than any other authority in Scotland. The Secretary of State told us that after talking to representatives of the Shetland islands council he became aware of the problems that the authority was facing. He learnt that there was oil off Shetland and he heard about Sullam Voe. Apparently, he did not know about those factors before he announced that he would impose a penalty on Shetland. He heard also that Shetland has problems with education, population and roads.
I never expected the Secretary of State to implement the Shetland penalty. He knows that if that were to happen, the Shetland authority could make life difficult for him in respect of oil development. Accordingly, he withdrew. That withdrawal had nothing to do with changed circumstances. He caved in because the authority made it clear that, if he did not, he would suffer considerable oil development penalties. That is the reality. The decision not to go ahead with the penalty had nothing to do with the guidelines, more traffic using the roads on Shetland and more pupils in the schools. It had nothing to do with all the nonsense to which we listened this afternoon from the right hon. Gentleman. All the factors that he mentioned have been known for years. If the guidelines were to mean anything, they should have been
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incorporated in them in the first place. If they were not, the absurdity of the way in which the guidelines were formulated is clearly demonstrated.
As a Glasgow Member for many years, I am rather surprised to learn that if I want to consider the problems of Glasgow in comparison with similar Scottish authorities, one of the similar authorities is Cumbernauld. That is an extraordinary proposition. Another "similar" authority is Aberdeen. I am sure that my hon. Friend the Member for Aberdeen, North (Mr. Hughes) will agree that, whatever else we may think about the respective merits of Aberdeen and Glasgow, it is ludicrous to compare the two cities in terms of local services, for example; and to compare Glasgow with Cumbernauld is a bit of a sick joke. The article in today's edition of The Times says that it would be equivalent to comparing the Isle of Skye with the Isle of Dogs. It is almost as ludicrous as that.
Mrs. Anna McCurley: Does the right hon. Gentleman agree that the problems that he is specifically talking about are the responsibility not of Glasgow district council, the authority that the debate is about, but, in the main, of Strathclyde regional council, which we are not talking about?
Mr. Millan: I do not agree. If the hon. Lady will do me the courtesy of looking at the guideline figures and how they are made up, she will find that what she said is misguided and untrue.
Mrs. McCurley: What services?
Mr. Millan: The services are laid out in the circular on the guidelines. I ask the hon. Lady to look at it.
Apart from expenditure per head in Glasgow inevitably being higher than expenditure in other districts in Scotland, this begs the question of local government decision-making. Are we trying to say that every local authority in Scotland should spend the same amount of money on the same services or should work to the same standards, and that anybody who goes above or below those standards is somehow committing a sin? Local government is about making choices and allowing the elected members to decide in some cases to spend more than the average or in other to spend less than the average. If it is not about that, it would be as well to ask every local authority to act simply as an agent for the Government, with standard laid down from the centre. That is what the Secretary of State is trying to do.
Mr. Nicholas Fairbairn: With regard to the responsibility of the Government and of local government, which is central to the right hon. Gentleman's argument, can he tell me how many electors benefit from an increase in expenditure by the Glasgow district council without contributing to it and what proportion of the funds spent by that authority are actually contributed by the electors?
Mr. Millan: I gave some figures for local authorities as a whole. It is my considered opinion, as a ratepayer in Glasgow, that we require more money spent on services because many of the services, due to Government cuts and pressures, are inadequate to meet the citizens' needs. There should be more expenditure on services in Glasgow. If there is any—
Mrs. McCurley rose—
Mr. Fairbairn rose—
Mr. Deputy Speaker: Order. We cannot have three hon. Members on their feet at the same time.
Mr. Fairbairn: Will the right hon. Gentleman give way?
Mr. Millan: No.
Mr. Fairbairn: It is on a matter that requires an answer.
Mr. Millan: I shall not give way. If any Conservative Member could ever get himself elected to Glasgow, I might give way.
I shall now deal with the £4 million, which, the Secretary of State agrees, should never have been taken into account when he issued the first warning to Glasgow that he would impose a penalty. I shall deal first with when it became known to the Secretary of State that there had been the error of £4 million. That error was made not by the Glasgow district council but by the Secretary of State's office. The Secretary of State said that he got to know about this on about 23 June. I do not know the exact date, but that does not matter. It was some time in June.
The Under-Secretary of State for Scotland (Mr. Michael Ancram): My right hon. Friend did not say that.
Mr. Millan: All right. I shall deal with the matter specifically. The hon. Gentleman has just taken over responsibility for these matters in the Scottish Office. I do not think that he knows anything about them. His hon. Friend the Member for Eastwood (Mr. Stewart) is now dealing with something else. He will know about it because he, with the Secretary of State, was at a meeting with COSLA on 22 April, when the specific point about the £4 million was drawn to the right hon. Gentleman's attention. That is not what the Secretary of State said this afternoon.—[HON. MEMBERS: "He said June."] He said June this afternoon, but he knew in April.
Mr. Younger indicated assent.
Mr. Millan: The Secretary of State is now agreeing with me. When did he initiate the action against Glasgow city council? Was it not in June? The Secretary of State is now acknowledging that the £4 million so-called error was known to his Department and to him personally, because it is recorded in the minutes of the meeting on 22 April. Why did he write that extremely misleading, dishonest and untruthful letter to hon. Members yesterday? It stated that the £4 million
"was only clarified in the course of discussion of the Council's representations."
Those were between June and July. Now the Secretary of State tells us that he knew all about it since 22 April.
Mr. Younger: As I made clear, the first time that the error in the drawing up of the form by Glasgow district council was drawn to our attention was 22 April.
Mr. Maxton: The right hon. Gentleman did not say that. He denied that.
Mr. Younger: Let us be clear. It was on 22 April, which was the date of the COSLA meeting to which I referred. It was brought up by a member of the district council. That was the first time that the matter was raised. It was a relevant matter for us to consider with Glasgow district council when representatives came to see my hon.
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Friend the Under-Secretary of State. They met him and clarified the nature of the error. That is perfectly clear and there is nothing extraordinary about it.
Mr. Millan: We shall be able to look at the record in Hansard tomorrow to see what the Secretary of State said.
Mr. Foulkes: The right hon. Gentleman will change it.
Mr. Millan: I hope that there will be no attempt to change the record, because that would be completely out of order.
I intervened in the Secretary of State's speech and specifically pointed out that the matter had been drawn to his attention on 22 April. He denied that in his speech. The letter written yesterday is the most dishonest letter that I have ever received from the Secretary of State. What is more, he knows it.
Mr. Fairbairn: On a point of order, Mr. Deputy Speaker. Is it in order to accuse an hon. Member of dishonesty?
Mr. Deputy Speaker: It is not in order. I do not think that that is what the right hon. Gentleman did. If he did, I am sure that he would wish to withdraw it.
Mr. Millan: I stand by everything that I said. We shall see on the record everything that the Secretary of State said. Whatever he said, yesterday he wrote an extremely misleading letter to me and to other Glasgow Members of Parliament. He cannot deny that.
In a sense, whatever the truth is, the really important issue is that the Secretary of State has steadfastly refused to take out the £4 million and to recalculate the figures. That means that the report takes on an entirely different complexion. Appendix B deals with expenditure per head of population. Glasgow's increase from 1982–83 to 1983–84, once the £4 million is taken out, comes down to 3·7 per cent. However, the increase in closely comparable districts is 5·5 per cent., and that in all districts 6 per cent. Therefore, Glasgow's increase is less than the comparable districts and less than the average for Scotland.
If we examine the trends of expenditure, we find that Glasgow increased expenditure in 1983–84 compared with 1982–83 by 3·7 per cent. That increase is less than for other districts in Scotland at 6·3 per cent. Yet Glasgow is being singled out for penalty because, according to the Secretary of State's original calculations—which he now admits were made on a mistaken premise — its increase in expenditure for the current year is excessive and out of line with so-called comparable and other districts in Scotland. When the figures are adjusted to take account of the £4 million, Glasgow's increase is less, not more, than that in comparable districts.
If one examines the figures that were given in answer to my hon. Friend the Member for Glasgow, Garscadden on Thusday 30 June for expenditure on services in Glasgow—
Mr. Fairbairn: What services?
Mr. Millan: —after taking interest adjustments out of account and comparing them over several years, one finds that, taking the £4 million out of account, in 1979–80 expenditure in Glasgow was £82·27 million while in 1983–84, calculated on the same basis, it is only £78·92 million. Those are strictly comparable figures which the Secretary of State gave. In other words, compared with

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three or four years ago, real expenditure on services in Glasgow has been reduced rather than increased, yet Glasgow is singled out for the penalty provision that we are discussing. Many more figures could be quoted, but, taking out the £4 million, there is no case for the penalty order.
The Secretary of State is exercising political spite against local authorities in Scotland of a different political persuasion from his own. That applies not merely to Glasgow. Glasgow, despite its major problems, has reduced expenditure in real terms in the past few years —as all Glasgow Members know to their cost.
The report is a general attack on local democracy. The ratepayers and electors of Scotland are getting poorer services and we are getting cuts in local authority spending that will add to the appalling high level of unemployment in Scotland. These penalty provisions are part of a wider attack on local government in Scotland. In a short time, they will affect every local authority in Scotland. The Secretary of State is replacing genuine local government in Scotland with dictatorship from St. Andrew's House, that is why we oppose the motion.
Mr. Maxton: On a point of order, Mr. Deputy Speaker,. Five hon. Members on the Labour side of the House, all of whom represent the city of Glasgow and Glasgow district council, to which the report relates, want an opportunity to speak on it. Not one Conservative Member represents the district of Glasgow. Therefore, I seek your guidance on whether it is possible to call Glasgow Members before others.
Mr. Deputy Speaker: I shall, of course, bear in mind the hon. Gentleman's point, but we must remember that this is a United Kingdom Parliament.
5.4 pm
Mr. Michael Hirst: The hon. Member for Glasgow, Cathcart (Mr. Maxton) should be aware that my constituency locks on to Glasgow.
Mr. Foulkes: It is a parasite.
Mr. Hirst: It is the nearest of four points around Glasgow where we are attacking the Labour bastion. I am confident that Conservative Members will represent Glasgow constituencies in the next Parliament.
Mr. Foulkes: Where will the hon. Gentleman be cremated?
Mr. Hirst: In my maiden speech two weeks ago, when I was speaking of the archaelogical and historic interests in my constituency, I observed that the Antonine wall runs through it. It was built to keep unruly northern tribes to the north. Some hon. Members and distinguished strangers might reflect on the need for a modern Antonine wall.
It will be no surprise to Opposition Members to learn that I support my right hon. Friend the Secretary of State for Scotland in taking selective action against those local authorities that have spending plans that appear to undermine the Government's broad economic strategy. After two years of restraint, Glasgow is proposing a significant increase in spending. In the medium and the short term, Glasgow's spending per head has been rising faster than that of other local authorities. My right hon.
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Friend gave the House the figures this afternoon—£107 per head in Glasgow as compared with the upper £60s in practically every other city in Scotland.
I should like to be convinced that the Labour administration of Glasgow district council is not using its budget as a means of confrontation with the Government. It is hard to avoid feeling that some people might relish the opportunity for a little confrontation with my right hon. Friend. Opposition Members have been complaining vigorously today that the Government are interfering with local democracy. Initially, I thought that that might be so but Opposition Members conveniently forget that the Government are making a massive contribution to what is spent in Glasgow. Accordingly, they have a right to say how the money is spent.
Opposition Members who make so much of the wishes of the electorate ought to reflect on the number of people in Glasgow who took the trouble to vote at the 1980 district council elections. Glasgow district council was elected on a small proportion of the electorate — something less than 20 per cent. Domestic ratepayers in Glasgow contribute rather less than 10 per cent. of what Glasgow district council spends. That represents about £34 million. I want to speak up for the other ratepayers in Glasgow who pay much more—some £80 million—and yet have no right of representation and no vote about who should sit in the city chambers in Glasgow. I speak of the commercial and industrial ratepayers who have no way of protecting themselves from rate increases in Glasgow, short of moving out of the city.
I shall declare my interest. As I have already told the hon. Member for Cathcart, who has now left the Chamber, my constituency locks on to the Glasgow boundary. I have many constituents who work or run businesses in Glasgow.
Mr. Foulkes: And take the money out.
Mr. Hirst: Not at all. I have spent all of my working life in Glasgow and I know well the reaction of the business community, which is bled white year in and year out by increases in rates. Rates in Glasgow have risen from 26·5 p to 61p over five years—an increase of about 130 per cent. One of the councils in my constituency that is slap bang beside Glasgow has, by contrast, increased rates by less than 40 per cent. during the same period.
There is understandable dismay that, after two years of moderation in Glasgow, the authority has put its foot on the spending accelerator once again. One need not be a Glasgow Member to know about the businesses that have been driven out because of high local authority rates. Every day small shopkeepers and commercial and retail organisations are driven out of business because they can no longer—[Interruption.]—Opposition Members must let me tell them some of the facts of life. Lewis's department store on Argyle street pays rates at 2·5 times more per square foot than those paid by its comparable stores south of the border. How can that organisation continue to provide employment for Glasgow people in the face of such high rates? Not only does it pay 2·5 times more per square foot than its sister shops south of the border, but it pays more rates than Harrods.
Mr. Donald Dewar: Does the hon. Gentleman accept that the percentage of the Glasgow budget contributed by central Government has decreased during the past few years from more than 40 per cent. to

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about 30 per cent.? If he is really worried about rising rates, the simplest and most sensible thing for him to do would be to persuade the Secretary of State for Scotland to maintain the Government's contribution.
Mr. Hirst: That is the typical Socialist remedy—simply to spend. The Opposition believe that the Government are the milch cow that constantly provides. It is a trite and easy answer to say that the Government should spend more money, but without saying where that money will come from. The example of the Scottish local authority that suffered a great reduction in rate support grant in 1976 was foisted upon other local authorities because of previous Socialist profligacy. It is sad that the Opposition appear not to understand that high rates are a significant contributory factor to businesses closing and jobs being lost. If Opposition Members were sincere in their desire to create more jobs in Scotland, they would recognise that fact and use their undoubted influence with local authorities of the same political persuasion to tell them of the need for restraint iii local government spending.
The Labour party has accused the Government of unwarranted interference in local authority decision-making. I am sorry that it has been necessary for the Government to take these powers. However, that is preferable to exposing ratepayers to increases year after year, and I am glad that my right hon. Friend the Secretary of State was prepared to come to the rescue of hard-pressed ratepayers.
During the general election campaign my right hon. Friend attended several meetings at which he articulated the Government's intentions on rates. Those proposals have won wide support—[HON. MEMBERS: "Where?"] Among the communities that have to pay the rates.
Mr. Foulkes: The Secretary of State did not even get half the votes in Ayr.
Mr. Hirst: The hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) should be careful when bandying about figures for the general election. If the Conservative party had lost 250,000 votes, I would not be here now. Many figures have been bandied about this afternoon, especially by the right hon. Member for Glasgow, Govan (Mr. Millan)—[Interruption.]
Mr. Deputy Speaker: Order. I am finding it difficult to hear what is being said.
Hon. Members: "You are lucky."
Mr. Hirst: Rather than confuse the House by quoting more figures, I shall try to clarify the matter. The argument is about the savings that are required. The letter from my right hon. Friend the Secretary of State, which has been referred to constantly this afternoon, states:
"Of this proposed reduction of £6 million, the District Council accepted that at least £3 million could be saved without any effect on services because of an additional capital allocation which I made to them. This leaves savings of £3 million which I propose that Glasgow District Council should make in their expenditure."
The nub of the problem is that £3 million savings must be made. Conservative Members find it strange that the achievement of such a reduction has caused such a major headache to Opposition Members.
All Scottish Members have received a letter from COSLA, which stated that there was no case for the Secretary of State to consider taking punitive action, especially since such action would ultimately be adverse
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to the interests of ratepayers. I cannot understand how it is adverse to the interests of Scottish ratepayers for the Secretary of State to protect them from unwarranted increases.
If the Opposition are in some difficulty in appreciating from where savings can come, perhaps I may put forward some areas where savings might be made. My right hon. Friend told us about the Contingency Reserve. Why is it so high? Could there not be savings in that, or is it being held in reserve against next year's increase? My colleagues on Glasgow district council proposed that the architectural services be put out to private tender at a saving of £1 million. If that is a viable proposition, why do not the Opposition espouse it as a means of saving ratepayers' money and of contributing to the savings that the Secretary of State wishes to make? The simple difference is that the Conservative party has no ideological hang-up about who does the work. If it can be done more cheaply and efficiently by an outside contractor, it should be given to that contractor.
The district council spends much money on cleansing, but I am unaware of any study being undertaken to put that service out to tender. I do not say that that should be an automatic response, not do I suggest that it would produce an automatic saving. A local authority in my constituency that reviewed the matter concluded that it was doing the job efficiently enough and should retain it. However, at least that authority considered the matter. I wish that Glasgow district council had considered the matter and concluded that no reasonable savings could be made.
My next point—
Mr. Foulkes: Come on.
Mr. Hirst: Opposition Members may protest, but someone must put forward areas of possible saving. I am not simply talking about the principle, but expressing some opinions. There are 6,000 empty houses in Glasgow, almost half of which are empty because they need repairs. Are the Opposition Members who have so much to say about the matter satisfied that proper use is being made of the contractors who could make those houses ready for letting? There are potential savings in that area, and I should be glad if Opposition Members would consider it.
Mr. Fairbairn: One of the greatest complaints made by Opposition Members about the House and many other places is that there are too many lawyers. How many lawyers does the legal department of Glasgow district council employ, and what on earth do they do?
Mr. Hirst: Housing management in Glasgow is expensive. It costs 50 per cent. more to manage a house in Glasgow than it does in other authorities.
Mr. Robin Cook: Will the hon. Gentleman give way?
Mr. Hirst: No. I must press on and finish my speech.
Mr. Cook rose—
Mr. Hirst: I have told the hon. Gentleman that I must press on.
My final point relates to the building and works department — that notorious direct labour organisation whose past activities are well chronicled in Hansard. The popular conception in Glasgow is that the department is heavily overmanned. I shall examine with keen interest its performance report, but am almost certain that it will be shown to be less efficient than the Scottish Special

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Housing Association. The department is fortunate in that it can, at ratepayers' expense, follow a policy of no compulsory redundancies. Sadly, the small companies that could do building repairs more cheaply, efficiently and quickly cannot give their employees the same undertaking. It is remarkable that local authorities cannot find the savings readily and fairly easily. Private enterprise has had to tighten its belt time and again and local authorities have no divine right to exemption from the disciplines that operate elsewhere in the market.
The Opposition stigmatise the Government as hard-nosed and uncaring and accuse it of making things difficult for Glasgow. The Government have invested £135 million in major projects which are doing a great deal to improve the face of Glasgow. Those actions underline the Government's determination to ensure that local authorities, like the nation, live within their means. I do not believe that what the Secretary of State has sought is unacceptable or unreasonable.
5.20 pm
Mr. Roy Jenkins: I listened with great interest and considerable agreement to the right hon. Member for Glasgow, Govan (Mr. Millan), but I do not agree that the Secretary of State's letter was the most dishonest from a Minister or his speech the most hypocritical to be heard in the House. Those are extremely strong claims and I do not think that the Secretary of State justified them in his letter or in his speech.
The Secretary of State spoke very fast. He seemed to be galloping hard towards the recess hoping that nobody would catch him before he got there. One was reminded of the comment:
"The louder he talked of his honour, the faster we counted our spoons."
What has happened in Glasgow is a tangled story. I was confused as to whether the Secretary of State had admitted that the council had told him about the £4 million. I do not understand why he said that it was an error. It is a matter of judgment under which heading it is put. At any rate, there was some confusion, but he made it clear that he had been so informed on 22 April.
The lesson of this and other confusions and the fact that the appendices are not an accurate back-up to what the Secretary of State is doing is that he and his Department are trying to do something which they ought not to do, are not qualified to do and do not have the resources to do. It is not the duty of the Government or the Scottish Office to determine the exact level of rates in Glasgow or any other city or district in the United Kingdom. If the Secretary of State or other Ministers attempt to do that, they will need to build up a vast new bureaucracy. The hon. Member for Strathkelvin and Bearsden (Mr. Hirst) had better realise that the bureaucracy in the Scottish Office will be far greater even than the hon. and learned Member for Perth and Kinross (Mr. Fairbairn) suggests. If this is done, there will have to be lawyers and goodness knows how many other people. Otherwise, it will be done by punching in the dark without the Scottish Office or the Government knowing what they are doing.
The Lane report was eloquent about how much bureaucracy would be involved in central control of local government expenditure, quite apart from its inherent
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undesirability on democratic grounds, but basic point is that the Secretary of State is trying to do something that is not the duty of central Government.
Mr. Bill Walker: Is the right hon. Gentleman saying that the Government, who fund the Health Service wholly and exclusively, have no interest in the level of rates and the impact on the health authority in the area?
Mr. Jenkins: Of course the Government have an interest in that, as has the House and, indeed, business. It is no good just dismissing the business interest, as people try to do in answer to the rather provocative argument of the hon. Member for Strathkelvin and Bearsden, because it is important, but that is very different from saying that the fixing of the rate level should be taken out of local hands and vested in central Government.
Mr. Fairbairn rose—
Mr. Jenkins: I must get on. The hon. and learned Gentleman has made a lot of interruptions and although he makes very good ones it would be an idea if he would make a speech occasionally.
No responsible Government can be indifferent to the level of local government expenditure. The Government are clearly entitled to fix their own contribution and to have a substantial and controlling say in the level of borrowing. I do not wish to open up the wider issues of the power of a Scottish assembly, in which I believe, but I have always taken the view that a Scottish assembly should have substantial rights to raise taxation. Nevertheless, it should not have the right to run an unbalanced budget. Once that happens, we are on the road to a separate currency and I do not believe that the people of Scotland want that. That is the essential difference between raising revenue that one is prepared to pay for and raising revenue that one is not prepared to pay for.
What is the real position of Glasgow? It is a tangled story, but so far as I can make out Glasgow is a high spender compared with other Scottish local authorities. Does that surprise anyone? It is certainly no surprise to anyone who knows that city. Apart from the specific problems, the underlying difficulty is that the population has fallen from more than 1,100,000 just over 20 years ago to 800,000 now.
Mr. Fairbairn rose—
Mr. Jenkins: I wish that the hon. and learned Gentleman would keep quiet for a moment.
The problems of Glasgow are thus immensely greater than those of Shetland, which has a fluctuating but rising population. It is therefore not surprising that the level of expenditure per head in Glasgow with all its problems is high. Indeed, it would be a bad thing if that were not so. The recent rate of increase in Glasgow's expenditure seems in fact to have been rather low compared with many other Scottish local authorities. Nevertheless, rates in Glasgow are very high indeed.
I wish to comment on two aspects of the powerfully argued report presented by the Glasgow district council. Referring to the shrinkage of the city's manufacturing base, it says that
"the city's future probably lies outwith the field of manufacturing industry— in commerce, the service sector, tourism and the like."

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There may be something in that, but it would be extremely foolish to believe that very high rate levels are not inimical to such developments. There must be a sensible approach.
The report also states:
"The District Council comprises 72 members elected by the people of Glasgow on the basis of their respective manifestos."
That may be so, but they are not elected on the basis of their respective proportions of the votes cast. If that were so, the Glasgow district council would be far more representative, on a local rather than on a central basis, far more responsible and much closer to the people in its approach to the essential issue of rate responsibility.
I oppose what the Secretary of State is doing, not because there are not problems with which he has to deal but because he is going in for excessive interference from the centre in local democratic decisions. That is the wrong road and it will lead him into great trouble in the future.
5.29 pm
Mr. Jim Craigen: I agree with the right hon. Member for Glasgow, Hillhead (Mr. Jenkins) that what is at issue is the relationship between central Government and local government. The right hon. Gentleman used the usual alliance skill, in that even in a debate on the Rate Reduction (Glasgow District) 1983–84 Report he managed to introduce the issue of proportional representation. At times, when the hon. Member for Strathkelvin and Bearsden (Mr. Hirst) was speaking, I thought that we were attending a meeting of the Glasgow district council. In dealing with these reports, the danger is that we sometimes end up doing the job of councillors when our job is to legislate.
The Secretary of State seemed to imply that I begrudged Shetlands its reprieve from the hit list. That is not so. I was wondering what its secret was, and I am still in some doubt. There is no question but that the £4 million that was inadvertently included by the Scottish Office in the figures led to Glasgow district council being put on the hit list and it has remained on it as a political face saver for the Secretary of State.
Mr. Younger: I am sure that the hon. Gentleman does not want to mislead anybody. Whoever was right and whoever was wrong in this issue, it is clear that that figure was included in the paper by Glasgow district council, not by the Scottish Office.
Mr. Craigen: Has the Secretary of State never heard of the telephone and good communications between New St. Andrew's House and Glasgow district council? Many things could have been sorted out quickly if there had been better communications between central Government and the local authority.
The Secretary of State was quoted in the press as saying:
"Let the punishment fit the crime".
I know that he is a great admirer of Gilbert and Sullivan, but he should read "Alice Through the Looking-Glass" one day because this issue is about who is to be master. In that book, Humpty Dumpty makes the point:
"When I use a word it means just what I choose it to mean."
Mr. Foulkes: My hon. Friend is using mixing metaphors.
Mr. Craigen: I do not mind the mixed metaphors; I just wish to establish the point.
The Secretary of State wants to make sure that he is the master. There will always be friction between local and
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central Government, not least because of the differences of political view and also because of the respective differences in the roles of central and local government. However, this order introduces something new in the relationship between the two bodies. We already have guidelines, and the trouble facing many of the authorities is that they are not sure about the precision or indeed the mobility of those guidelines. They are constantly changed when it suits the Secretary of State. We all agree that rates are far too high. However, the Government have cut the rate support grant to local authorities, and in Glasgow there has been a reduction from 41 per cent. to 31 per cent. between 1979 and 1983.
The Government also control the level of approved expenditure, as well as adjusting the percentage of the rate support grant. The problem facing the city is as much one of income available as of expenditure incurred or about to be incurred. I have written to the Secretary of State about a report leaked from the Greater Glasgow health board during the election campaign about hospital admissions during the first year of life. I have had a useful reply from the chairman of the Greater Glasgow health board in which he rightly points out the interrelationship between the health services, housing, social work and education. I hope that the Secretary of State will back up the Greater Glasgow health board's initiative. We compartmentalise far too much of our public spending and sometimes the budget headings in one department have a direct relationship to the problems that may arise in another.
So far in the debate the £1 million for the Burrell collection has not been mentioned. Are we to take it from the Secretary of State that the padlock will be put on the door of the Burrell art gallery before it opens this autumn? The Government encouraged the district council to proceed with the building of the art gallery. The Prime Minister has said that she is critical of local authorities and other public bodies that do not spend on capital projects. I questioned her in a letter that I wrote to No. 10, asking why local authorities should spend on capital projects when they are denied the revenue expenditure to man those institutions—whether libraries, art galleries, schools or other facilities. I did not receive a particularly satisfactory answer.
Reference has been made to expenditure per head. I know that nothing can be done at this stage, but I put this up as a marker. In the forthcoming rate support grant settlements a new element must be introduced that takes account of the variations in income levels. When there is talk about introducing local income tax, we must remember that one of the problems that arises is the equalisation factor, as some areas are far better off than others simply because of levels of incomes and differences in the levels of unemployment of those areas. We know from figures published by the DHSS and Strathclyde regional council that 31·4 per cent. of the population is at or below supplementary benefit level in Glasgow. This is a major influence in the availability of resources to the district council. These variations should be taken into account in the rate support grant settlement.
Mr. Fairbairn: This is an important point about a community becoming poorer and poorer. Does not the hon. Gentleman appreciate the point made by the right hon. Member for Glasgow, Hillhead (Mr. Jenkins)—

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that over 333,000 people have moved from Glasgow, probably for income reasons? Is it not because of the rating system that they have done so?
Mr. Craigen: I was tempted to interrupt the hon. and learned Gentleman earlier and ask him whether he was in favour of agricultural rerating, although perhaps that is another issue. I am talking about expenditure per head of population and I am putting down a marker for future rate support grant settlements that the income levels of those communities should be taken into account.
The Secretary of State said earlier that it is not for him to say where the savings might be made. This raises the responsibility factor. Soon, no one will claim or accept responsibility or be responsible for anything. The Secretary of State says, "I give the money but I leave it to the district council or the local authority to determine its priorities. It so happens that my civil servants lay down such stringent guidelines that the local authority is sometimes in doubt about the make-up of these client groups and the nature of the expenditure, but I do not allow the local authority to do that of which I do not approve."
We shall end up by electing councillors next May who will not be able to do as much as the councillors elected in the last district council elections. If it is not too cynical, I point out that last week we were debating parliamentary orders over the timetabling of the rates. There was no suggestion then that we should introduce orders to postpone the district council elections in 1984. However, the way that we are going will make it increasingly difficult to get councillors of the calibre that we require. Many sensible, hard-working and right-thinking councillors are getting a bit cheesed off about the role that they are expected to fulfil in local government. The Conservative party has spent much time devising hit lists and introducing orders. Why are all those intellectual impulses not being put into rate reform, about which they have said so much during the past 10 years?
5.40 pm
Mrs. Anna McCurley: I want to take the right hon. Member for Glasgow, Govan (Mr. Millan) to task. I sincerely hope that he will permit me to do so. I am particularly interested in the right hon. Gentleman's career because he is my Member of Parliament. I have a particular interest in the debate as a Glasgow ratepayer. The right hon. Gentleman tallked about Glasgow's problems. He opened the bleeding chunks of flesh, but he forgot to remind the House that we are not talking about the problems of social work or education—the problems that really beset the city of Glasgow—but about the problems that relate to Glasgow district council.
Glasgow district council is famous of old for its overspending. Why is it overspending? Glasgow district council is inefficient, over-bureaucraticised, overmanned and charges low council house rents to keep its own people happy so that it can get back into power at the direct expense of commerce and industry in Glasgow. My hon. Friend the Member for Strathkelvin and Bearsden (Mr. Hirst) articulated well the problems of Glasgow's commerce and industry. Business people in Glasgow do not have the representation although they contribute rates. My right hon. Friend the Secretary of State is attempting to stop Glasgow cutting its own throat.
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Much of the debate the other day was spent talking about mandates and whether the House has a mandate over local authorities. Let me set the record right. Glasgow's total expenditure is £358 million. Of that domestic ratepayers contribute only 9·5 per cent. and they are the only people who have a vote. There is an average turnout of 35 per cent. at local government elections, 20 per cent. of which votes Labour. Therefore, by my calculations, one fifth of that 9·5 per cent. is contributed by Labour voters. Therefore, Labour Members are representing under 2 per cent. of the people of Glasgow and they talk about mandates. Commerce and industry contribute 22·5 per cent.—two and a half times the percentage contributed by the domestic ratepayer. The city is being bled dry. Small businesses are shutting down and large industries have a hard time competing. My hon. Friend talked about Lewis's in Argyle street, which pays over £1 million a year in rates, whereas Selfridge's, a comparable store but far larger in Oxford street, pays less. That is nonsense and it is destructive for the city. That is precisely what my rates are doing to Glasgow and that is why I fully support what the Government are doing. Unless the Government intervene in some way in the activities of Glasgow district council the city will fall apart. As a ratepayer in that city, I am not prepared to see that happen.
Mr. Fairbairn: Glasgow's business community is being frozen out by high rates. What proportion of those 2 per cent. who pay rates benefit from that increased expenditure?
Mrs. McCurley: Very few people. Only a small percentage of those who pay the full rate in Glasgow benefit from it because much of Glasgow's expenditure has been directed to specific areas. That means that the money is not spread around the divisions of Glasgow equitably and certainly not equally.
Mr. Dewar rose—
Mrs. McCurley: We must remember—this is why I heartily endorse what my hon. Friend the Member for Strathkelvin and Bearsden said —that the Government are not averse to helping Glasgow. They are very sympathetic and support Glasgow with direct Government funding. Money pours into Glasgow—into the Maryhill corridor and the Glasgow eastern area of renewal.
The Conservative party takes care of Glasgow. We cannot be criticised for our treatment of Glasgow but we can criticise Labour Members for the way in which they try to destroy the city by protecting their own interests.
5.47 pm
Mr. Bob McTaggart: I have to admit to a deep sense of concern, even of alarm, over the business before the House this evening. We have before us a report from the Secretary of State for Scotland which asks the House to approve the imposition of penalties on four Scottish local authorities for what he calls "excessive and unreasonable expenditure".
There is not a shadow of a doubt that when the House divides tonight that approval will be given and those penalties will subsequently be imposed. There can be no other outcome, given the massive parliamentary majority that the Government enjoy. That inevitable course of events may seem unremarkable to many, both inside and outside the House, but if that is the case they have failed to pay sufficient attention to the detail of the issue before

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us. There are, indeed, a number of worrying aspects to what can only be described as the cynical exercise of unaccountable power.
First, for those hon. Members who have followed the evidence closely, there is the inescapable conclusion that the Secretary of State has failed to make his case for taking action against those authorities. The detailed representations made by the authorities themselves, and the arguments outlined in the contributions of my right hon. and hon. Friends so far and which will no doubt continue, show clearly that the Secretary of State has built his case not on objective evidence but on a tissue of misrepresentation and half truths. That can be proved by examining the case of Glasgow district council.
The Under-Secretary of State met representatives of the Glasgow district council last month to discuss the proposed penalty. The minutes of that meeting form part of the report before us. When asked for a statement of why the Government were initiating action against the council, the Under-Secretary outlined three main reasons. First, he said that Glasgow had the highest percentage excess over guidelines of any district council in Scotland — well above the district council average of 21·8 per cent. However, the figures produced by the Secretary of State in support of that claim bear little relation to the real world of local government finance or to the real decisions that must be made by councillors about local services and local budgets.
The Government failed to take proper account of a whole range of factors in Glasgow's budget, which inevitably pushed it well over guidelines that were always unrealisable. They also failed to take into account that many of the factors are peculiar to Glasgow, making it indefensible to compare its budget with those of other district councils.
Hon. Members who have made the effort to look at the evidence will know to which factors I refer. Examples are — the running costs of the new Burrell gallery; the reclassification of the city's budget to include items previously treated as non-relevant expenditure—such as the £5 million budget for Glasgow's area management committees; and the inclusion of temporary loan interest in the expenditure figures, even though the council has no direct control over such expenditure. Any objective assessment could find only that that part of the Government's case could not be justified.
The second reason put forward by the Minister was supported by even weaker arguments in justification of an indefensible position. The Government claim that Glasgow's spending per head of population is well above the average for other closely comparable authorities. The choice of closely comparable authorities is unjustified. Edinburgh, Aberdeen and Falkirk are three of the wealthiest local authorities in terms of rateable income. Clydebank and Falkirk have populations that would be dwarfed by that of Glasgow. Cumbernauld is a new town with heavy public investment through the development corporation. Not one of those authorities faces the same scale of need or the same mix of environmental, social and economic problems as those that confront Glasgow which unavoidably, must have implications for Glasgow's level of expenditure. Two of those closely comparable authorities, Cumbernauld and Aberdeen, show increases in their spending per head of population well in excess of the increase shown by Glasgow.
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The third reason put forward was that Glasgow's current budget represented a real growth in expenditure at a time when the Secretary of State had asked all authorities to make reductions in their spending. Again, no account was taken of the £4 million expenditure on environmental improvement grants that it was later admitted should have properly been considered as housing expenditure. No account was taken of the running costs of the new Burrell gallery or the cost of the transfer of functions from the region as a result of the Stodart report. No account was taken of the council's prudent provision for an inflation rate of 6 per cent. in the coming year. The whole basis of a major part of the Secretary of State's case falls apart on close inspection.
At the crucial meeting with Glasgow district council, the Under-Secretary put forward those three main reasons to justify action against Glasgow. Yet all the arguments have shown that none of those reasons can be supported by any objective evidence. The conclusion is inescapable —the Government's case for imposing penalties cannot be supported, even by their own evidence. The penalties are unfair, arbitrary and authoritarian.
Conservative Members who like to see themselves in the role of world-wide champions of democracy and freedom should reflect that tonight they will probably lend their support to Government action which, if repeated elsewhere in other countries, they would condemn as dictatorial and tyrannical. Massive parliamentary majorities do not excuse Governments from having to justify their actions on rational and logically defensible grounds. It is clear that the action that the House is being asked to sanction is neither rational nor logical. It is a frightening example of the naked exercise of massive political power which sees no reason to justify itself to those it directly affects.
There are other worrying aspects of the report to which the House should give careful consideration. It was brought before the House by the Secretary of State and is concerned with four Scottish local authorities. It deals with the financing of Scottish local government and with the relative financial burdens of Scottish ratepayers and taxpayers. It deals with what can be described only as Scottish business. Yet it is laid before the House by a Minister with no mandate from the people of Scotland, and it emanates from a Government whose policies have only recently been rejected by more than 70 per cent. of the Scottish electorate. Frankly, it is sponsored by a group of Scottish Office Ministers who have more in common with the colonial administration than with the legitimate executive arm of government in Scotland. It will receive the majority approval of the House not on the basis of votes by the elected representatives of the Scottish people, but of votes cast by many Conservative Members who know relatively little about Scottish affairs in general and even less about the affairs of the local authorities with which the report deals. Some of them may never have set foot on Scottish soil. No genuine believer in the democratic principle could be other than appalled at such a prospect.
Let us consider the results of the recent general election—
Mr. Fairbairn: Before we consider the results of the general election, can the hon. Gentleman tell me what percentage of those who vote in Glasgow— far fewer pay rates in Glasgow—actually voted for that wretched, spendthrift district council?
Mr. McTaggart: Ten out of every 11 voters in Glasgow voted Labour. I shall ignore that cumbersome and irrelevant intervention from someone who is not even domiciled in Scotland, let alone in Glasgow.
Let us consider the results of the general election, in which Scotland, especially urban Scotland, returned a majority of Labour Members to the House. It did so partly because of traditional loyalties—
Mr. Fairbairn: On a point of order, Mr. Deputy Speaker. It has been suggested by the hon. Member for Glasgow, Central (Mr. McTaggart) — I do not know whether it is in his script—that I am not domiciled in Scotland—
Mr. Deputy Speaker: Order. That is a point of information, not a point of order for me.
Mr. Fairbairn: On a point of order, Mr. Deputy Speaker. Is it in in order for an hon. Member to suggest that I am not domiciled in Scotland when I have never been domiciled anywhere else?
Mr. Deputy Speaker: I have already said that that is a point of information and not a point of order.
Mr. McTaggart: The hon. and leaned Gentleman is certainly not domiciled in Glasgow, about which he has made at least 10 interventions this evening.
I ask the House again to consider for a moment the results of the recent general election at which Scotland, particularly urban Scotland, returned a majority of Labour Members. It did so partly because of traditional loyalties but partly because of its particular social and economic make-up, which inevitably influences its political outlook. Glasgow illustrates that point effectively. Few areas in the United Kingdom can have been more severely affected by the present recession and by the policies of the present Government.
Last year unemployment in the city constantly hovered between 70,000 and 80,000. At the time of the 1981 census, no fewer than five of Glasgow's constituencies were in the top 10 United Kingdom constituencies with the highest rates of male unemployment. In the space of just two short years, between 1979 and 1981, it suffered the net loss of about 20,000 jobs in the manufacturing sector alone. It has continued ever since to lose industrial jobs of every description. One hundred thousand of Glasgow's citizens now claim supplementary benefit and many more depend on it. The city faces a severe housing crisis, with more thn 22,000 of its houses officially described as below the tolerable standard and a minimum of 35,000 public sector houses requiring treatment for the growing problem of damp.
For more than 30 years Glasgow's population has been in constant decline with a high proportion of those leaving coming from the more economically active groups. Inevitably, this has had serious implications for the social and economic make-up of the remaining population. Glasgow has a high proportion of less skilled and lower income workers' a much higher than average proportion of its population at or below the poverty line and massive problems of urban decay and multiple deprivation —problems recognised by the Government.
The people of Glasgow need lessons from no one on what it means to be at the wrong end of an unfair and unequal society, in which power and wealth are unevenly distributed and in which the opportunity to thrive and prosper is denied to hundreds and thousands of citizens.
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The general election results in Glasgow do not decide who should form the Government. Glasgow has often voted Labour in the past and seen Tory Governments returned. Scotland has often voted Labour in the past and seen Tory Governments returned at Westminster. But this time there is a difference. This time the general election result is proving to have implications for local democracy which few voters could have contemplated at the time they cast their votes. Glasgow voters can accept that the party for which they voted lost the last general election, but they know that the party for which they voted won the last district council elections. In those elections they voted for the Labour party. They voted for a Labour district council and they won. The Labour district council in Glasgow prepared this year's budget. The Labour party in Glasgow district council prepared this year's rate poundage on the basis of a democratic mandate given to it by the voters of that city. If the council abuses that mandate it will answer for that abuse in the proper democratic fashion—at the elections in May 1984. In the meantime, anyone who interferes with that council in the proper exercise of its functions is interfering with the democratic process, and the Secretary of State and the Scottish Office Front Bench team know that well.
I appeal to hon. Members who are genuinely interested in defending the democratic traditions of this country to join the Labour party tonight in the Lobby in voting against this arbitrary and undemocratic Government action.
6.4 pm
Mr. Michael J. Martin: I should like to take up the point made by the hon. Member for Renfrew, West and Inverclyde (Mrs. McCurley) that the tenants of Glasgow district council pay cheap rents. The rents are far from cheap. My constituents are finding it increasingly difficult to pay their rents. It is nonsense to say that the tenants in Glasgow are paying cheap rents. This problem is the fault not of Glasgow district council but of the Government who have forced local authorities to increase their rents.
Mr. Bill Walker rose—
Mr. Martin: I am sorry, but I will not give way. Many hon. Members have intervened in the debate and I understand that the Minister wants to reply to the points that are raised. It would be unfair to other hon. Members if I were to give way.
I am sorry that the hon. Member for Strathkelvin and Bearsden (Mr. Hirst) has left the Chamber. I am sorry that he made the remarks he made about Glasgow. It is nonsense to suggest that Glasgow and Glasgow alone is losing industry and to suggest that the reason for that is high rates. I happen to know a great deal about the hon. Gentleman's constituency because Springburn adjoins the Bishopbriggs area of Strathkelvin. The hon. Gentleman should know that at this very moment houses are being built on what used to be an industrial estate in Bishopbriggs. If the hon. Gentleman claims that Bishopbriggs is doing well in terms of low rates, why is it losing industry in the same way as Glasgow? The hon. Gentleman should also remember that Keir and Cowden Ltd. used to have a large brickworks in the Bishopbriggs area but it no longer exists. Many companies are leaving boroughs and areas around Glasgow, and so Glasgow is

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not the only place to be losing industry. The services that the district council supplies benefit the people of Glasgow and those outside the city.
It is planned to build a bypass through my constituency. The large scale demolition will uproot many of my constituents. We will have a concrete monstrosity called a motorway just to accommodate the people of the Stepps. The quality of life in Springburn will diminish because of that motorway. When the hon. Gentleman attacks the Glasgow district council he should remember that many people in Bishopbriggs, Newton Mearns, Bearsden and the surrounding areas are employed by Glasgow district council.
It has always been my view—I am sure that it is shared by many hon. Members—that if an employer is in difficulties it is a duty of the local Member to ensure that an industry or service which happens to be a large employer of labour is protected. Many Conservative Members who have constituencies within travelling distance of Glasgow may well be receiving letters of complaint from their constituents about redundancies in the Glasgow district council. I should like to see the representations that go to the Secretary of State if that happens.
It is ridiculous to suggest that traders are leaving Glasgow because of high rates. Consider, for example, Marks and Spencer, one of the biggest employers in Britain. It is doing very nicely at its Bell street, Glasgow, branch, so well that the firm intends to spend millions of pounds extending those premises. It is across the street from Lewis's—I was in the city centre last weekend—and that company is not doing too badly out of Glasgow.
Mr. Craigen: My hon. Friend knows the Metal Box site and will recall that I saw the Prime Minister before the new year when the firm announced that it was closing that factory. During our conversation the Prime Minister suggested that rates might be the factor, but I said that I had established with the company that the main factor was the economic recession and a fall in the demand for tins.
Mr. Martin: I agree. Rates are not the only problem from which the private sector is suffering in Scotland. I am the chairman of the industry sub-committee of the Labour group in Scotland. We have had the Opportunity this year to meet various private employers and their organisations. The representatives of the building industry forcefully made the point that they were not pleased with Government policy generally or with cuts in public expenditure in particular. It depends on local government contracts more than any other industry, yet it is suffering the most as a result of Conservative policy. In other words, the Government are attacking not only those who voted for them but those who have supported them over the years.
In common with other hon. Members who represent constituencies some distance from this place, I had a good opportunity during the election campaign to be involved with my constituents. I had time to meet the people of Possil park, where I served my apprenticeship and where my wife lived. The quality of life in that area has deteriorated greatly in the last 10 or 12 years. The poverty is appalling, as is the rate of unemployment.
In areas such as that, only the social services can help, and I include the efforts of Glasgow district council. It may be said that the region provides the s social services, but a great deal of back-up is required from the district council.
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If the services provided by the district council are bad, there is often little that the social services can do to improve matters. Nothing is simply the responsibility of the region. Nor is the region free from Government cuts; by this time next year even Strathclyde region could be on the Government hit list.
In view of the terrible poverty that exists in some areas, we need a local authority which will be assured of help and resources, not attacks and cuts, from the Government. It is all very well to say that local government spending must be reduced, but something must be done to replace the services which are being destroyed. By all means administer policies from St. Andrew's House, but if the Government do not intend to increase the social services and improve their quality they will he doing a great disservice to the people of Glasgow and elsewhere.
For many people who are unemployed the only leisure facilities available are in parks and through the sports and recreational facilities offered in public halls. Unemployment is a problem for society as a whole, but it is the duty of Government to reduce the amount of unemployment. Until that is done, many young people will go on feeling resentful and bitter, and those feelings will get worse if they are not given leisure facilities so that they can use their energies.
Conservative Members constantly talk about law and order and about giving people a short, sharp shock. Recently they were all for capital punishment. It is about time that they did something positive to help people. One way to do that is to ensure that local authorities have the means to give people the facilities they deserve.
6.17 pm
Mr. Gordon Wilson: As one of the Glasgow diaspora, I listened with sympathy to the remarks of the hon. Member for Glasgow, Springburn (Mr. Martin). There is no doubt that Glasgow has considerable problems, many of which arise from the dispersal of population in the last 20 years.
I do not believe that Glasgow district council over its considerable history, including its predecessor Glasgow corporation, can be exempted from criticism. But it is a democratically elected local authority and what it says about the services that the city needs should be listened to by the House and, in particular, by the Government.
When the hon. Member for Renfrew, West and Inverclyde (Mrs. McCurley) said that the interests of industry ranked so highly in her estimation, I suspected she was arguing in favour of the business vote being returned. If so, sheer logic would indicate that it should be returned to the large corporations which contribute so much to the Conservative party. One cannot have one without the other, though the undue emphasis that is placed by Conservative Members on the business element is distinctly unhealthy when we think of local government being democratically controlled and elected.
Mr. Henderson: At a time when one of the great concerns of the nation is jobs—and as jobs relate to the effectiveness of the business community —that is not something that we should lightly ignore.
Mr. Wilson: The hon. Gentleman distorts the point I made. I suggested that the emphasis placed on the business element by the Conservatives was unhealthy. I do not dispute that consideration should always be given to the

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interests of commerce and industry, but that, too, is a responsibility laid on local authorities, which are elected and should have the duty to nurture industry and commerce in their areas.
It is significant that we have this debate only a few hours after the conclusion of the Cabinet discussions. Soon we shall learn the extent of the sacrifices that the Secretary of State will call upon the Scottish people to make, whether or not they consent. Those who have read about the £5 billion reduction in grant throughout the United Kingdom must be worried about its impact on local authorities and the Health Service in Scotland.
In presenting these reports the Scotish Office is obliged to show that the spending increases of local authorities, including Glasgow, are excessive and unreasonable. The Secretary of State, in his exposition of the case against the Glasgow district council, has not discharged that obligation. He has not explained clearly and satisfactorily why the elected local authority should be compelled to act in the way dictated by a statutory instrument. The way in which the reduction in grant was casually glossed over in correspondence was unsatisfactory. In his letter the Secretary of State said that the Government found it necessary to proceed with the motion without giving any explanation.
This is all part of the squeeze and cutback in local authority expenditure. The distortions in the high rate increases have been caused by a reduction in the rate support grant. Conservatives should not support that. They are supposed to speak for the ratepayers. Therefore, Conservative Members must accept responsibility for the penalty of high rates which has been visited upon ratepayers. It is significant that the share of public expenditure spent by the Scottish Office in 1980–81 was 5·65 per cent. and that, on Government figures, it will reach 5·13 per cent. in 1985–86.
I have spoken in earlier debates about the validity of the local mandate, so I shall not develop that point further. We are talking about democracy and the right of central Government to impose on local authorities decisions that are unacceptable to them. The argument advanced by Scottish local authorities is valid. One of the prime recommendations of the Wheatley commission was that reform of local government was necessary to enhance local autonomy. I warn the Scottish local authorities that the argument about local control, which I accept, will not wash in the House and elsewhere. No central Government would readily concede a reduction in their powers. They would have to be coerced.
Although local authorities wish to push their case, as many hon. Members will do this evening, they will lose. This is not the first round. During the past 10 years—stretching back into the previous Labour Administration —we have had a series of debates such as this one. On each occasion the local authorities have lost the battle. The Glasgow, Stirling, Kirkcaldy or Lothian mandates will not carry the day. The House should address itself to the powerful argument for a Scottish mandate—
The Under-Secretary of State for Scotland (Mr. John MacKay): There were 53 lost deposits.
Mr. Wilson: The hon. Gentleman makes a jeering point, but he must accept that the Conservative party assumed power on the shirt tails of an English majority.
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The Government have no moral right to tell Scottish local authorities how to behave. The arrogance of people such as the hon. Member for Argyle and Bute (Mr. MacKay) is driving many Scottish people to look at the quality of the Government that they have.
Mr. Foulkes: They would not put up with the Liberals either.
Mr. Wilson: If we are to achieve anything, we should urge a Scottish mandate. If all Scottish Members asked for and supported a Scottish mandate, it would not affect the votes on these motions, because all the English Members would pour in.
We must argue here and in the country that the Scots should not be governed by a party which does not have sufficient representation to justify it being in power in St. Andrew's house. We must challenge the right of the Government to govern Scotland without the consent of the Scottish people. This is not an and exercise. We know what the Chancellor is trying to do and what the Cabinet will probably have agreed to. Therefore, we realise that considerable suffering will be visited upon our countrymen. If the Opposition do not fight on the basis of a Scottish mandate, we shall have to accept responsibility for all the suffering that will result from the Government's actions during the next four years. Such failure to fight will be on the consciences of those who do not co-operate. What we do, how we fight and how effectively we represent our constituent's interests will be crucial.
6.25 pm
Mr. John Maxton: The Labour party believes that the Government have no mandate in Scotland, but that requires the establishment of a Scottish assembly and the Scottish National party does not believe in that. It believes in nothing less than total independence. That was the policy passed at its conference.
Mr. Foulkes: That is right.
Mr. Maxton: The mandate argument must be pursued in relation to Glasgow in particular. The Secretary of State for Scotland—if he would for once listen to what other people are saying — seems to think that today he is protecting the Glasgow ratepayers, but they have consistently made clear which party they support, and it is not his party.
In 1978 Labour swept Glasgow in the regional elections. In 1979 Labour swept Glasgow in the parliamentary elections; in 1980 in the district elections; in 1982 in the regional elections again; and in 1983 in the general election. The Labour party has won every election in Glasgow during the past six years. It has decisively defeated the Conservative party. Glasgow, Hillhead was the only Conservative-held seat in Glasgow. The Conservatives now have none.
The people of Glasgow want Labour policies carried out by a Labour district council. The people voted for the Labour party to maintain levels of services. Whereas the Secretary of State may say that he has the right to control the money that he gives to Glasgow district council, he has no right to say how much the district council should raise through the rates that it levies on its citizens who voted for it and for the type of policies that it said it would implement.
The only logical argument that the Secretary of State put forward was that the Glasgow district council spent

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more per head of the population than any other district council. Many of us have recently received a useful booklet called "Rating Review". It shows that Glasgow spent more per head of the population on libraries, museums, leisure, recreation, halls, environmental health and cleansing than any other district council. It might therefore be called a spendthrift local authority.
Mr. Cook: No—Marxist.
Mr. Maxton: No, not even Marxist. The amount per head spent on those facilities by Glasgow district council is high because they are not just for the people of Glasgow. They are for the people of Bearsden and Strathkelvin, in particular, who are parasites on the city's facilities. Those people do not provide money for museums and halls. The Glasgow district council provides the museums, parks and halls.
The best example of all is in the constituency of the Under-Secretary of State, the hon. Member for Eastwood (Mr. Stewart), who unfortunately is not present. Right in the middle of Eastwood there is the Rouken Glen park, which is used almost exclusively by the people of Eastwood, although it is paid for and maintained by the ratepayers of Glasgow. Eastwood district council does not contribute a single penny towards the upkeep of that park, although its ratepayers benefit from it. That is true of many of Glasgow's facilities.
If the Secretary of State were logical, he would suggest dividing the total cost of Glasgow expenditure—not just the expenditure of the people of Glasgow, but the expenditure of the whole area of greater Glasgow. The major mistake—this is why Glasgow is in its present position, and why its rates tend to be high— was in 1972, when the House passed the legislation dealing with the reform of local government in Scotland and left the satellite suburbs of Glasgow outside in small separate district councils. I hope that the next labour Government will bring Eastwood, Bearsden, Strathkelvin, and Bishopbriggs into the Glasgow district council, where they should be. In that way the rates would be paid by the people who used the services. That would be the right way to proceed.
These motions are unjustified. We have heard no logical arguments from the Secretary of State to justify them. The right hon. Gentleman is illogical, and he is an intellectual lightweight, to say the least. I ask the House to reject the motions.
6.32 pm
The Under-Secretary of State for Scotland (Mr. Michael Ancram): The approach of the hon. Member for Glasgow, Cathcart (Mr. Maxton) to his perorations is always fascinating. I have never yet heard him come to the end of a peroration without describing someone in terms that would be better applicable to himself. I was also fascinated by his argument that because Glasgow had no Conservative Members of Parliament the Government had therefore no right to take any decisions affecting the city. He must surely accept that in the unlikely eventuality of his party ever coming to power again, on his own basis, that Government would not be able to govern north of the Tay. It would be nonsense to try to govern Scotland on that basis.
We have had a full debate, and I do not intend to detain the House for long. I shall pick up some of the points that
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were raised. I listened with interest to all the speeches made by Opposition Members who represent Glasgow constituencies, but we have heard hardly a word about the interests of the city's ratepayers. It is typical of their attitude in debates of this nature that they never pay any attention to the interests of ratepayers, although when the ratepayers, particularly industrial ratepayers, vote with their feet, as they often do, they are the first to complain.
Mr. Dewar: Does the Under-Secretary agree that if he and his right hon. Friend had maintained their contribution to Glasgow at a steady level, in real terms — not increasing it, just maintaining it—it would have been possible to have a rate reduction of 17p in the pound?
Mr. Ancram: Perhaps the hon. Gentleman will allow me to make my speech in my own way. [Interruption.] I am intending to cover that subject, and I assure the hon. Gentleman that I shall do so. I shall answer the speech of the right hon. Member for Glasgow, Govan (Mr. Millan) last, and when I do so I shall have something to say on the matter.
The second surprise to me in this debate, despite the fact that representatives of Glasgow district came to visit me at the Scottish Office — a meeting that has been mentioned on several occasions in the debate — and despite the fact that at that meeting they had the honesty to admit that, in view of the adjustments that had been made and the £3 million extra that had been given to them by the Government—they had £3 million available to go back to the ratepayers, and in fairness to those representatives, they said that they would prefer to give that back next year—is that there has been no mention of that by Opposition Members, as if the £3 million had somehow disappeared. In their failure to mention that, we see their total disregard for the interests of their ratepayers. In the district elections next year Glasgow ratepayers would do well to remember what has been said in this debate.
A number of matters have been raised with which I shall deal briefly. The hon. Member for Glasgow, Maryhill (Mr. Craigen), whom I do not see in his seat, mentioned the Burrell gallery. He spoke of the burden that it would place on Glasgow. The expenditure consequences of opening the new gallery were clearly set out in the council's representations, and the Secretary of Slate took into account the points made by the council in proceeding with the action.
I personally welcome the opening of the gallery, and I am pleased that the Government have given support towards the capital costs of the project. Nevertheless, the expenditure implications of the project cannot be viewed in isolation from the need to contain expenditure generally. The Secretary of State was able to provide capital support only by making commensurate reductions elsewhere in his programme, and I wish that Glasgow had done likewise. These are painful decisions, but they must be taken, and therefore the Secretary of State cannot exclude the running costs of the gallery from his considerations.
Mr. Millan: Is the Minister recommending that the city does not open the gallery? Incidentally, the capital provision was made under an arrangement made by me, not by his right hon. Friend.
Mr. Ancram: Yes, but this Government found the money. [Interruption.] It is for the Glasgow district

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council to decide whether it wants to open the gallery, which, as I said, I personally would welcome. It is for that council to find a way to finance it, just as the Secretary of State did when he provided support.
I am sorry that the right hon. Member for Glasgow, Hillhead (Mr. Jenkins) has not managed to last the course of a Scottish debate and that he, too, has left the Chamber. He said, somewhat to my surprise, that the entry of £4 million, which has been the subject of dispute in this debate, was a matter for judgment. I shall come back to the matter later. He said that the column into which such a figure goes is a matter of judgment. For an ex-Chancellor of the Exchequer to say that about the way in which one presents figures and certifies them as correct leaves much to be desired.
Finally, I come to the remarks of the right hon. Member for Govan. He said a number of things which surprised me. He spoke first of the centralist role of this Government in attacking the roots of local government. He claims that that is being done by the Government in exercising their control over the expenditure of local authorities. However, he cannot avoid the fact that he himself was prepared to use precisely the same methods to control local government expenditure.
Mr. Millan: Nonsense.
Mr. Ancram: The right hon. Gentleman may say that, but today he told the House that he believed that central Government must have an interest in local government spending.
Mr. Millan: If this Government are doing only the same as I did under Labour, why on earth do we need all the additional legislation?
Mr. Ancram: We must examine what the right hon. Gentleman did. He said that he believed that central Government should have an interest in overall spending by local authorities. I understood him to say that that should be done by reducing the rate support grant percentage. He used that method himself. The right hon. Gentleman went further and said that the rates were too high because the Government had reduced the percentage of rate support grant. He then said that he did not think that Governments should try directly to influence or control rate increases.
Apparently the right hon. Gentleman's policy is to attack direct methods of reducing rates while advocating rate support grant reductions which put up rates, and implicitly support any level of rate increase, however high it is. That is the logical conclusion that must be drawn from what the hon. Gentleman said today. The right hon. Gentleman should tell the House that his party does not believe in trying to control local government expenditure at all. That is his position, and it is about time that he came clean on it.
The right hon. Gentleman discussed a number of issues connected with Glasgow. He spoke about guidelines in general. He was one of the authors of the original guidelines. I was interested to hear him say that he thought that the way in which guidelines had been drawn up was odd, because I understood that he was instrumental in implementing them. His guidelines were based upon past expenditure. As such, they rewarded high expenditure, irrespective of need. It is no wonder that he objects now
610
to the Government's scientific approach to drawing up guidelines. I am glad that COSLA has agreed to collaborate with the Scottish Office in drawing up the guidelines.
Mr. Robin Cook: The Minister has referred to the current guidelines and their scientific basis. I draw his attention to the recent publication by Arthur Midwinter of the university of Strathclyde which comes to the opposite conclusion. It says:
"The client group approach does not provide a scientific basis. It would be pernicious to use this method given the present state of the art as a basis for current expenditure guidelines."
Given that clear statement from the only scientific body that has examined the guidelines, how do the Government justify their argument?
Mr. Ancram: I always put in perspective Dr. Midwinter's remarks because he is more of a friend of the Opposition than he is of the Government.
Mr. Cook: Cheap.
Mr. Ancram: The client group approach takes more cognisance of need than any past method on the basis of historic expenditure.
The right hon. Gentleman asked about the £4 million. Perhaps he misunderstood what my right hon. Friend the Secretary of State said. My right hon. Friend referred to the "so-called error" which he said was
"over the £4 million included by Glasgow in its certified return on the line for housing improvement grants. This line is used by all other authorities—and up to this year has been used by Glasgow itself. This year, Glasgow decided to enter in this line expenditure on the grants themselves. It was bound to cause confusion if Glasgow chose, without explanation, to change its practice in providing information. The first time that it was drawn to my attention was … at a meeting between me and representatives of COSLA. The purpose of such meetings is, of course, to discuss local authority financial matters in general, not detailed points of this kind.
"Once again the term error is quite inappropriate".
My right hon. Friend said that the true purpose of the £4 million, shown against "housing improvement grants", was explained at the meeting between the Secretary of State and representatives of Glasgow district council on 20 June.
The right hon. Member for Govan made severe allegations about my right hon. Friend. He referred to the meeting with COSLA and to the meeting with me. He distinguished between the two. It is important to put the record straight.
Mr. Millan: There is no point in carrying on the argument because Hansard will show exactly what the Secretary of State said. I specifically asked the Secretary of State whether the matter was drawn to his attention on 22 April and he said "No." That will be in Hansard tomorrow.
Mr. Ancram: It must now be obvious to the right hon. Gentleman that at the meeting with COSLA on 22 April this matter was raised.
Mr. Millan: We shall read it in Hansard tomorrow.
Mr. Ancram: We are debating a report for which we seek approval and it is right that the record should be set straight before we vote.
Mr. Millan rose—
Mr. Ancram: I shall not give way again.
Mr. Millan rose—
Mr. Speaker: Order. The Minister is not giving way.
Mr. Millan: On a point of order, Mr. Speaker.
Mr. Speaker: Order. I hope that the right hon. Gentleman will not use a point of order to ask a question.
Mr. Millan: I shall not do that, Mr. Speaker. We shall find the truth tomorrow. I hope that if what I have said is confirmed the Secretary of State will have the good grace to apologise in the House.
Mr. Ancram: I hope that if the right hon. Gentleman finds that he is wrong he will have the decency to withdraw his remarks.
We have been told by the Opposition that the Government have failed to justify their action against Glasgow. We took this action on the basis of a number of criteria about which the Opposition know. They also know that the statistics and the criteria were changed following the meeting with myself when it was accepted that the £4 million should not be counted as relevant expenditure for the purposes of assessing excess over guidelines. Even with those adjustments, the guidelines excess in Glasgow remained at 30·5 per cent., well above the average district level of 21·8 per cent. The expenditure per head, even after that adjustment, reduced from £112·32 to £107·06, is well above the average for comparators of £67·11. Despite the consultations and the close attention that I paid to the representations made to me which I reported to my right hon. Friend, the case against Glasgow is still strong. That council's expenditure is, in any view, excessive and unreasonable. For that reason, I ask the House to support the report.
Question put:—
The House divided: Ayes 220, Noes 175.

Division No. 38]

[6.48 pm

AYES

Amess, David

Freeman, Roger

Ancram, Michael

Fry, Peter

Aspinwall, Jack

Gale, Roger

Atkins, Rt Hon H. (S'thorne)

Galley, Roy

Bendall, Vivian

Gardiner, George (Reigate)

Boscawen, Hon Robert

Gardner, Sir Edward (Fylde)

Bowden, Gerald (Dulwich)

Garel-Jones, Tristan

Brandon-Bravo, Martin

Glyn, Dr Alan

Bright, Graham

Goodlad, Alastair

Bruinvels, Peter

Gower, Sir Raymond

Buck, Sir Antony

Grant, Sir Anthony

Bulmer, Esmond

Greenway, Harry

Chapman, Sydney

Gregory, Conal

Chope, Christopher

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

Clarke Kenneth (Rushcliffe)

Griffiths, Peter (Portsm'th N)

Coombs, Simon

Ground, Patrick

Cope, John

Grylls, Michael

Corrie, John

Gummer, John Selwyn

Crouch, David

Hamilton, Neil (Tatton)

Currie, Mrs Edwina

Hanley, Jeremy

Dorrell, Stephen

Hargreaves, Kenneth

Douglas-Hamilton, Lord J.

Harvey, Robert

Dover, Denshore

Haselhurst, Alan

Dunn, Robert

Havers, Rt Hon Sir Michael

Durant, Tony

Hawkins, C. (High Peak)

Eggar, Tim

Hawkins, Sir Paul (SW N'folk)

Evennett, David

Hawksley, Warren

Eyre, Reginald

Hayward, Robert

Fallon, Michael

Heathcoat-Amory, David

Farr, John

Heddle, John

Favell, Anthony

Henderson, Barry

Fletcher, Alexander

Hicks, Robert

Fookes, Miss Janet

Higgins, Rt Hon Terence L.

Forsyth, Michael (Stirling)

Hirst, Michael

Forth, Eric

Hogg, Hon Douglas (Gr'th'm)

Fox, Marcus

Holland, Sir Philip (Gedling)

612

Holt, Richard

Prentice, Rt Hon Reg

Hordern, Peter

Price, Sir David

Howard, Michael

Raffan, Keith

Howarth, Gerald (Cannock)

Rathbone, Tim

Howell, Ralph (N Norfolk)

Renton, Tim

Hubbard-Miles, Peter

Rhodes James, Robert

Hunt, John (Ravensbourne)

Rhys Williams, Sir Brandon

Hunter, Andrew

Ridsdale, Sir Julian

Jackson, Robert

Robinson, Mark (N'port W)

Jessel, Toby

Roe, Mrs Marion

Johnson-Smith, Sir Geoffrey

Rost, Peter

Jones, Gwilym (Cardiff N)

Rowe, Andrew

Jones, Robert (W Herts)

Rumbold, Mrs Angela

Kellett-Bowman, Mrs Elaine

Ryder, Richard

Kershaw, Sir Anthony

Sainsbury, Hon Timothy

Key, Robert

Sayeed, Jonathan

King, Roger (B'ham N'field)

Shaw, Sir Michael (Scarb')

Knight, Gregory (Derby N)

Shelton, William (Streatham)

Knowles, Michael

Shepherd, Colin (Hereford)

Lawler, Geoffrey

Silvester, Fred

Lawson, Rt Hon Nigel

Sims, Roger

Lee, John (Pendle)

Skeet, T. H. H.

Lester, Jim

Smith, Sir Dudley (Warwick)

Lewis, Sir Kenneth (Stamf'd)

Smith, Tim (Beaconsfield)

Lightbown, David

Soames, Hon Nicholas

Lilley, Peter

Spence, John

Lloyd, Peter, (Fareham)

Spencer, D.

Lord, Michael

Spicer, Jim (W Dorset)

Lyell, Nicholas

Spicer, Michael (S Worcs)

McCrindle, Robert

Stanbrook, Ivor

McCurley, Mrs Anna

Stanley, John

MacKay, Andrew (Berkshire)

Steen, Anthony

MacKay, John (Argyll & Bute)

Stern, Michael

Macmillan, Rt Hon M.

Stevens, Lewis (Nuneaton)

McNair-Wilson, M. (N'bury)

Stewart, Allan (Eastwood)

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

Stewart, Andrew (Sherwood)

McQuarrie, Albert

Stradling Thomas, J.

Major, John

Sumberg, David

Malins, Humfrey

Taylor, John (Solihull)

Malone, Gerald

Taylor, Teddy (S'end E)

Maples, John

Temple-Morris, Peter

Marland, Paul

Terlezki, Stefan

Marshall, Michael (Arundel)

Thomas, Rt Hon Peter

Maude, Francis

Thompson, Donald (Calder V)

Mawhinney, Dr Brian

Thompson, Patrick (N'ich N)

Maxwell-Hyslop, Robin

Thorne, Neil (Ilford S)

Mayhew, Sir Patrick

Thornton, Malcolm

Mellor, David

Tracey, Richard

Merchant, Piers

Trotter, Neville

Meyer, Sir Anthony

Twinn, Dr Ian

Miller, Hal (B'grove)

van Straubenzee, Sir W.

Mills, Iain (Meriden)

Vaughan, Dr Gerard

Mills, Sir Peter (West Devon)

Viggers, Peter

Miscampbell, Norman

Waldegrave, Hon William

Moate, Roger

Walden, George

Monro, Sir Hector

Walker, Bill (T'side N)

Montgomery, Fergus

Waller, Gary

Morrison, Hon P. (Chester)

Walters, Dennis

Moynihan, Hon C.

Wardle, C. (Bexhill)

Murphy, Christopher

Warren, Kenneth

Neale, Gerrard

Watts, John

Nelson, Anthony

Wells, Bowen (Hertford)

Nicholls, Patrick

Wells, John (Maidstone)

Norris, Steven

Wheeler, John

Osborn, Sir John

Whitfield, John

Ottaway, Richard

Wilkinson, John

Parris, Matthew

Wolfson, Mark

Patten, Christopher (Bath)

Wood, Timothy

Patten, John (Oxford)

Woodcock, Michael

Pawsey, James

Yeo, Tim

Peacock, Mrs Elizabeth

Younger, Rt Hon George

Pink, R. Bonner

Pollock, Alexander

Tellers for the Ayes:

Porter, Barry

Mr. Ian Land and

Powell, William (Corby)

Mr. Michael Neubert.

Powley, John

NOES

Adams, Allen (Paisley N)

Ashley, Rt Hon Jack

Archer, Rt Hon Peter

Ashton, Joe

613

Atkinson, N. (Tottenham)

Duffy, A. E. P.

Bagier, Gordon A. T.

Dunwoody, Hon Mrs G.

Banks, Tony (Newham NW)

Eadie, Alex

Barnett, Guy

Eastham, Ken

Barron, Kevin

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

Beckett, Mrs Margaret

Evans, Ioan (Cynon Valley)

Bell, Stuart

Evans, John (St. Helens N)

Bermingham, Gerald

Ewing, Harry

Bidwell, Sydney

Fatchett, Derek

Blair, Anthony

Field, Frank (Birkenhead)

Boothroyd, Miss Betty

Fisher, Mark

Boyes, Roland

Flannery, Martin

Bray, Dr Jeremy

Foot, Rt Hon Michael

Brown, Gordon (D'f'mline E)

Forrester, John

Brown, Hugh D. (Provan)

Foster, Derek

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

Foulkes, George

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

Fraser, J. (Norwood)

Brown, Ron (E'burgh, Leith)

Freeson, Rt Hon Reginald

Bruce, Malcolm

Freud, Clement

Caborn, Richard

Garrett, W. E.

Callaghan, Jim (Heyw'd & M)

Gilbert, Rt Hon Dr John

Campbell, Ian

Godman, Dr Norman

Canavan, Dennis

Golding, John

Clarke, Thomas

Gould, Bryan

Clay, Robert

Hamilton, James (M'well N)

Cocks, Rt Hon M. (Bristol S.)

Hamilton, W. W. (Central Fife)

Cohen, Harry

Hardy, Peter

Coleman, Donald

Harman, Ms Harriet

Cook, Frank (Stockton North)

Harrison, Rt Hon Walter

Cook, Robin F. (Livingston)

Heffer, Eric S.

Corbett, Robin

Holland, Stuart (Vauxhall)

Corbyn, Jeremy

Home Robertson, John

Cowans, Harry

Hoyle, Douglas

Cox, Thomas (Tooting)

Hughes, Mark (Durham)

Craigen, J. M.

Hughes, Robert (Aberdeen N)

Crowther, Stan

Hughes, Roy (Newport East)

Cunliffe, Lawrence

Hughes, Sean (Knowsley S)

Dalyell, Tam

Janner, Hon Greville

Davies, Rt Hon Denzil (L'lli)

Jenkins, Rt Hon Roy (Hillh'd)

Davies, Ronald (Caerphilly)

John, Brynmor

Davis, Terry (Bham, H'ge H'I)

Kaufman, Rt Hon Gerald

Deakins, Eric

Kennedy, Charles

Dewar, Donald

Kilroy-Silk, Robert

Dixon, Donald

Kirkwood, Archibald

Dobson, Frank

Lambie, David

Dormand, Jack

Lamond, James

Dubs, Alfred

Leadbitter, Ted

614

Lewis, Ron (Carlisle)

Randall, Stuart

Lewis, Terence (Worsley)

Redmond, M.

Litherland, Robert

Rees, Rt Hon M. (Leeds S)

Lloyd, Tony (Stretford)

Richardson, Ms Jo

Lofthouse, Geoffrey

Roberts, Allan (Bootle)

Loyden, Edward

Roberts, Ernest (Hackney N)

McCartney, Hugh

Robertson, George

McDonald, Dr Oonagh

Rogers, Allan

McGuire, Michael

Rooker, J. W.

McKelvey, William

Ross, Ernest (Dundee W)

Mackenzie, Rt Hon Gregor

Rowlands, Ted

Maclennan, Robert

Sedgemore, Brian

McTaggart, Robert

Sheerman, Barry

McWilliam, John

Sheldon, Rt Hon R.

Madden, Max

Shore, Rt Hon Peter

Marek, Dr John

Short, Ms Clare (Ladywood)

Marshall, David (Shettleston)

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

Martin, Michael

Silkin, Rt Hon J.

Mason, Rt Hon Roy

Skinner, Dennis

Maxton, John

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

Meacher, Michael

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

Meadowcroft, Michael

Soley, Clive

Michie, William

Stott, Roger

Mikardo, Ian

Strang, Gavin

Millan, Rt Hon Bruce

Straw, Jack

Miller, Dr M. S. (E Kilbride)

Thomas, Dr R. (Carmarthen)

Morris, Rt Hon A. (W'shawe)

Thompson, J. (Wansbeck)

Morris, Rt Hon J. (Aberavon)

Tinn, James

Nellist, David

Varley, Rt Hon Eric G.

Oakes, Rt Hon Gordon

Warden, Gareth (Gower)

O'Brien, William

Wareing, Robert

O'Neill, Martin

Welsh, Michael

Park, George

Williams, Rt Hon A.

Parry, Robert

Wilson, Gordon

Patchett, Terry

Winnick, David

Pavitt, Laurie

Woodall, Alec

Pendry, Tom

Young, David (Bolton SE)

Pike, Peter

Powell, Raymond (Ogmore)

Tellers for the Noes:

Prescott, John

Mr. Frank Haynes and

Radice, Giles

Mr. Norman Hogg.

Question accordingly agreed to.
Resolved,
That the Rate Reduction (Glasgow District) 1983–84 Report, which was laid before this House on 7th July, be approved.

Rates (Lothian Region)
7 pm
The Secretary of State for Scotland (Mr. George Younger): I beg to move,
That the Rate Reduction (Lothian Region) 1983–84 Report, which was laid before this House on 7th July, be approved.
The arguments that were advanced in the previous debate are relevant to this issue and I shall not weary the House by repeating any of them.
I shall spell out as briefly as I can the case behind the report on the Lothian regional council. The House will know that the council has been the subject of selective action for the financial years 1981-82 and 1982–83. In those two years, as well as this year, Lothian's excess over guidelines was and is the highest of any regional council, and its planned expenditure per head is above that of any comparable authority and above the regional average.
My action in 1981–82 and 1982–83 reduced Lothian's expenditure significantly. Last year that was accompanied by a welcome rate reduction of 16p in the pound. When agreeing not to proceed with action to reduce Lothian's rate support grant in 1982–83, in the light of its voluntary rate reduction, I said that I hoped that the council would continue to consider urgently the scope for further reductions in its expenditure in future years. Unfortunately the council has failed to live up to that hope.
Far from continuing to reduce its expenditure this year, the Lothian regional council has planned for a slight increase. Once again its expenditure, measured against the guidelines, showed the highest increase of any region. Its planned expenditure per head was significantly higher than that of comparable authorities and above the regional average. Had Lothian chosen to co-operate and continue the downward trend in its expenditure, which was brought about by previous selective action, further selective action would have been unnecessary.
Two issues have been raised in particular about Lothian's budget for 1983–84 and used to suggest that the selective action is not justified. First, it has been claimed that Lothian reduced its rates this year by 8p and that its rates are now closely in line with those of other regions. There is no doubt that Lothian has reduced its rate from 100p in 1982–83 to 92p in 1983–84. That is clearly welcome to ratepayers, but that has been achieved only by the use of a credit balance of almost £10 million. It is clear from the fact that the authority does not plan a reduction in its expenditure that the rate reduction, not being linked to real expenditure savings, is not a lasting one.
Secondly, it has been alleged that Lothian continues to have the highest guidelines excess of the regions because its guidelines are constantly being changed. Until 1981–82, existing expenditure patterns played a large part in determining an authority's guidelines. An authority with high expenditure would have high guidelines. In 1982–83 the client group method of assessing relative expenditure need was used for the first time to calculate guidelines. That was based on a systematic examination of relative expenditure need related to work carried out for the distribution committee.
There was some damping effect in both 1982–83 and 1983–84 on the client group figures to take account of previous expenditure, and it is not surprising that authorities with a history of high spending should find themselves with lower guidelines as a result of the change.
616
The objective of the guidelines is not to reflect actual spending but to try to establish relative expenditure need on a basis that treats all authorities, whether high or low spenders, in the same way. It would not be fair if high-spending authorities continued to be set high guidelines.
It is clear that Lothian has failed to continue the necessary process of reducing its expenditure which was started in 1981–82. I do not think that it is unreasonable to bring down an authority's expenditure, as I propose, to the average per head of regional councils as a whole, especially when that average includes authorities with special geographical and social needs, such as the Strathclyde and Highlands regions.
Mr. Gavin Strang: Does not the right hon. Gentleman recognise that, because the Lothian regional council has a history of high spending, it has made some important capital investments, such as new sewerage works, which involve continuing revenue expenditure? His policy will involve drastic cuts in expenditure on schools, for example, if revenue spending on the sewerage works is to be maintained. Common sense dictates that the Government should recognise that Lothian has had a higher level of capital investment than other authorities, and that should be taken into account when it comes to cutting expenditure.
Mr. Younger: The hon. Gentleman makes a genuine point which flows from decisions taken in previous years. It is one of the factors that I have carefully taken into account in the representations made to me by the Lothian regional council and in the consideration that has been given to the exercise of the discretion. It is one of the reasons why we have modified what was originally proposed for the council. I appreciate that all these factors have to be taken into account.
Mr. Robin Cook: The Secretary of State said that it could not be claimed to be unreasonable to bring Lothian's expenditure down to the average of other regional authorities. With respect, that is not the case that the right hon. Gentleman has to prove. He has to prove that Lothian's expenditure is excessive and unreasonable. Is he asking the House to accept that any increase in expenditure over and above the average of other regions is excessive and unreasonable?
Mr. Younger: No, I am not. That has never been the purpose of any of the reports.
Mr. Cook: The right hon. Gentleman has just said that it was.
Mr. Younger: No, that is not so. The hon. Gentleman will recall that on every occasion when this issue has been debated I have made it clear that it is not a matter of taking any one criterion and saying, "Because the authority is above this criterion, action is to be taken against it on account of its excessive and unreasonable expenditure." It would not be possible or correct to do that. I have to demonstrate that the expenditure proposed by a particular authority is excessive and unreasonable, and to do that it is necessary to demonstrate that it is considerably out of line with several criteria. I have on many occasions listed the criteria and said how many of them we take into account. The case that I am making against Lothian rests on the general principles that I have been applying generally. There is no difference between this case and any others.

617
Even after Lothian made the reduction that was required to bring down its expenditure by the equivalent of 6p, its expenditure per head was still above that of all other comparable authorities, including the Central region, Fife, Grampian and Tayside, all of which run satisfactory and efficient services. We know from the budget proposals of the Conservative group that the reduction proposed for Lothian is achievable and that there need be no compulsory redundancies. The wise move by the council of agreeing that none of the recruitment necessitated by its budget should take place until the matter is resolved should ensure that there are no compulsory redundancies.
The Lothian case is clear. Its planned expenditure is excessive and unreasonable on all measures. Only action such as I propose will bring its expenditure — and consequently its rates—to a level that is not excessively above that of other authorities.
7.8 pm
Mr. Donald Dewar: Anyone who has taken an interest in the debate on local government over the past three years in the House and in Scotland generally will be aware that every time the Conservative party gets into a tight corner its first and immediate instinct is to attack the Lothian region. It holds a special and prominent place in Tory demonology.
I do not think that the House should conduct its business in that way. If the Lothian region is on trial, and if the charge is excessive and unreasonable expenditure, at least we owe the authority the courtesy of considering the evidence and the arguments. It is not good enough for the Secretary of State to start his case with the significant comment that he has had to move against the Lothian regional council in the past. The Opposition say that that action should not have been taken, but even if we were to accept the premise that in the past it was necessary to do so and that the authority has previous convictions, that does not mean that it is guilty in this case and on this occasion.
My right hon. Friend the Member for Glasgow, Govan (Mr. Millan) talked about the general background and I shall not deal with it again. I shall direct myself to the evidence, which has largely been provided by the Secretary of State. I want to try to keep things simple because I think that that will be especially helpful to the Under-Secretary of State who is to reply.
The first criterion that has been used by Conservatives is reference to the guidelines and the extent to which he planned expenditure of the Lothian region is in excess of the guidelines. We have tried to argue consistently and with justification that the guidelines are discredited. It was said in the previous debate that councils up and down the land, however they are politically controlled and however true blue they are, have failed to live within the guidelines because they are unrealistic. Only three out of 65 have met the impractical targets set for them.
At the end of the day the whole black farce was exposed by the interesting exercise that the Government conducted with the Shetland Islands council. I make it clear, so that there is no ambiguity, that I am delighted that that council has been let off the hook and has escaped from the trap, but it is obvious that there is something wrong with the guidelines because Shetland was almost 47 per cent. over them. The Secretary of State, having talked to the council,
618
discovered, apparently to his amazement, that there were certain consequences of oil development that he had not thought of when he set the guidelines. He now says that the expenditure is not excessive and unreasonable but is at a level to which he is prepared to give his blessing.
Therefore, the Secretary of State will penalise Lothian, Stirling, Kirkcaldy and Glasgow for being in excess of the guidelines, yet he is saying that the guidelines for Shetland can be abused by 47 per cent., which is all right, and not excessive or unreasonable. Anyone with half an eye can make the deduction that the guidelines should have taken account of the situation in the Shetlands when they were formulated. Whatever may be the casualty of this exercise — it is largely the credibility of the right hon. Gentleman—the principal one is the guidelines system itself. If one starts to erect an oppressive edifice on the basis of the guidelines, one is building upon unsure and unsatisfactory foundations.
Let us consider what has happened to Lothian's guidelines since 1978–79. They have increased by the smallest percentage of any of the regional authorities in Scotland—94·5 per cent. — while the average for the regions as a whole is 100·86 per cent. The guidelines of the comparable group of authorities, picked by the Secretary of State himself, increased in that period by 111 per cent. Therefore, a large percentage of the gap that has apparently appeared between the expenditure of Lothian region and the allegedly objective guidelines is accounted for by the fact that Lothian has been extremely badly treated by the mysterious formula through which the figures emerge. The region has made cuts and scrambled for safety to try to avoid the wrath of the Secretary of State, but it can never reach the target because every time it makes concessions, the guidelines retreat before it again and it is left stranded.
I shall consider some of the other criteria, for example appendix A, which deals with expenditure. The expenditure in Lothian in 1979–80 was £334 million. In 1981–82 it went up to £348 million, and in 1983–84 it fell to £345 million. Therefore, over four years, in a budget that literally runs to hundreds of millions of pounds, the increase in real terms was £11 million. Within the Lothian region there could be a perfectly legitimate debate on whether expenditure should have increased by £11 million or decreased by £11 million. It could argue about that, considering what it would say to its electorate and how they would react when they cast their votes in the regional election.
To maintain that that marginal variation allows the Secretary of State to ride roughshod over the whole fabric of local democracy in that part of Scotland is nonsense. Even that rise of £11 million is highly suspect. If one looks at the expenditure figure that the Secretary of State gives in his appendix, one sees that he changes the basis of calculation. The first few years are calculated on November 1982 figures. For 1982–83 and 1983–84 we go into cash figures. If one recalculated those cash figures back to November 1982 prices, I suspect that one would find that the alleged rise of £11 million, which is a small figure against the size of the budget, practically or perhaps totally disappears. Therefore, there is no case on the global figures of expenditure for saying that the Secretary of State is justified.
The right hon. Gentleman might say that it is not a matter of how much is spent but of the excess over the guidelines. Lothian region is 13 per cent. over the

619
guidelines, it is said. In parenthesis, it is not 13 per cent. over the guidelines at all. The right hon. Gentleman has not included in the guidelines the £120 million of unallocated expenditure that was included in 1983–84, which the Secretary of State knew and admitted would be spent by the local authorities. If we take that and a number of other minor adjustments into account, the figure is just over 7.5 per cent. in excess of the guidelines, but it is still considerably more in excess of the guidelines than other regional authorities. In 1978–79 Lothian region was only 4·5 per cent. over the guidelines. How can that be so? How is that possible when its expenditure hardly rose at all? The answer is that the guidelines themselves have been fiddled and fixed and amount almost to a fraud. The Lothian region has no real case to answer or that first criterion.
I do not want to go through endless figures in great detail. However, I shall look at expenditure per head. In 1979–80 it was £444. In 1983–84 it had dropped to £439. Is it excessive and unreasonable when there is a fall in expenditure per head? Is that a reasonable definition of "excessive" or "unreasonable"? The Secretary of State said that all other regional councils had a better record, and although he tried to retreat when he replied to my hon. Friend the Member for Livingston (Mr. Cook), he said explicitly that he thought that it was not wrong for him to try to force a reduction to the regional average.
Had the right hon. Gentleman looked at expenditure per head in Strathclyde, he would have seen that it is much higher than in Lothian, and perhaps rightly so, because of all the problems there. However, there are also problems in Lothian. The numbers game that the Secretary of State has been playing on a most shaky basis destroys all credibility and confidence in the system. The increase in expenditure per head for 1978–79 to 1983–84 for all regional councils in Scotland was 5·2 per cent. For Lothian it was 5·6 per cent. Who could call that excessive and unreasonable? Is it such an offence to national economic policy? Are people in the Treasury saying that, because over four years Lothian put up expenditure by 0·4 per cent. per head of the population above the regional average, we must change the entire course of this country's economic policy? That is nonsense.
In 1982–83 to 1983–84, the figure went up in all regions by 2·7 per cent., but in Lothian it went up by only 0–2 per cent. If there is any charge—it is a feeble and weak charge—against Lothian region, it is a charge rooted in the past. If one looks at the last two figures one sees that is performing "better" than other authorities. I put "better" in inverted commas because some people might think that it was arguable that the performance was better. But in terms of the Secretary of State's demands it is performing much better than local authorities in its regional category.
We could go through category after category. The Secretary of State is constantly talking about the rates. There was some rather depressing support for him from new Members of Parliament during the debate. I make it clear that the Secretary of State is the author of domestic, commercial and industrial ratepayers' misfortunes. He has not been faced with escalating expenditure by local authorities in Scotland. By and large they have been level pegging over the years, but the rates have been forced up by the catastrophic and, by any terms, extremely significant reductions in his contribution.
If, during the past four or five years the Secretary of State had simply maintained his contribution to the Glasgow budget in real terms it would have been the
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equivalent of a rate poundage of 17p. For him then to say that he is the man who is going to the barricades to help the ratepayer is the height of hypocrisy. I do him the credit of thinking that he knows it.
I was intrigued when, in his brief and cursory speech, the Secretary of State said that it is claimed that, in the past three years, Lothian has reduced its rate poundage. I do not know what the English language means but it appears that the Secretary of State is suggesting in a rather unpleasant way that such a reduction has not in fact occurred. It has. In the past three years the Lothian rate has come down from 112p to 100p to 92p. If that is the mark of an excessive spending, irresponsible and spendthrift authority I am amazed.
We are also told that Lothian's rates are above the average. They are. Lothian's 92p is above the average for regional councils in Scotland— 1p above the average. Yet we have all this machinery creaking into action. Moreover, the relationship between Government and local government will be soured and scarred because local government has been told that 1p above the regional average for rate poundage amounts to an offence to the good government of Scotland. That is a joke and one that is in extraordinarily bad taste.
The politics of the case make a curious and disturbing story. When the budget discussions in Lothian opened, several competing bids were advanced. One was from the Labour group. If its proposals had been accepted the rate poundage would have been increased to 102p. The Tories suggested a budget that would have produced a rate poundage of 86·5p. In the delicate circumstances in Lothian it was clear that there would be much hard bargaining. I understand that the final outcome was not reached arbitrarily or by a global compromise but that the council went through its budget in great detail and examined almost every item.
The budget which produced a rate poundage of 92p was arrived at after 146 budget items had been discussed. In 108 of those 146 items—well over two thirds —the Tories supported the winning line. They approved, promoted or voted for the final decision. Therefore, they had a substantial say and, in the majority of items, Conservative policy ruled. I do not suppose that the Secretary of State maintains that they are incapable of simple arithmetic and did not know what they were doing. Of course they knew what they were doing and voted on the merits of the case as did all of the other parties in the council. The result was a rate poundage of 92p, which the Secretary of State is now trying to repudiate.
The Secretary of State probably read a leader in The Scotsman on that issue on 23 February. That newspaper said that the budget was
"arrived at in the most democratic fashion possible".
The budget was supported by four of the five political parties represented on the Lothian regional council and to attack it, according to The Scotsman, would be "naked aggression". We now have the unpalatable and extraordinary spectacle of the Tory leader of Lothian council coming out of that meeting and, having failed to get his way, crying "foul" and running screaming for help to his political seniors at St. Andrew's House. The decision was democratic and was reached only after detailed consideration. It is a negation of democracy for the Secretary of State now to turn round and say that he will reinstate what, by a strange but not surprising

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coincidence, is more or less the Tory budget as originally proposed although it had been repudiated as I have described.
We are engaged not simply in an argument about this year's budget in Lothian. On the figures that the Secretary of State has provided, the best of the argument is overwhelmingly on the council's side—not the Labour group but the majority of that council which is a cross-party amalgamation of interests. We know that expenditure per head in Lothian has decreased in the past couple of years and we know that expenditure in real terms has been more or less static. Moreover, we know that, since 1981, Lothian's spending in real terms has been £53 million a year less on services than it was. We also know that rates have been reduced as I have described. In those circumstances, to take the enormously serious step of arrogating the rights of democratically elected councillors, the Secretary of State is striking at the heart of the democratic system as we know it. That is why we are protesting. We are not protesting because this is an argument about this year's figures, the nuts and bolts and balance sheet of the budget. We are protesting because what the Secretary of State is doing is wrong in principle. It would be just as wrong for these powers to be used in this way by a Labour Secretary of State. They are fundamentally flawed and offensive.
I hope that the right hon. Gentleman will reconsider his position. I hope that if false pride will not let him do that he will not take this route in future. The total sum of money that is being raised by this squalid operation across the four authorities is £18·8 million. We are therefore discussing a small sum of money as compared with the total of the right hon. Gentleman's expenditure and national budgets. However, the price that we are paying is enormous. I understand that the repayment to ratepayers of Lothian will be about 19p a week. It is a handful of coppers and not even a handful of silver. For that, we are disrupting the relationship that has been built up over the years. That relationship must depend to some extent on trust between the Government and local government. By insisting on these measures, the right hon. Gentleman is giving a ring of truth to charges of dictatorship. He is asking us to pay far too high a price. His decision, if he is thrawn and insists upon it, will be greatly regretted.
7.27 pm
Lord James Douglas-Hamilton: The hon. Member for Glasgow, Garscadden (Mr. Dewar) speaks persuasively, but when he uses such words as "dictatorship" he grossly exaggerates his case and does an injustice to it. The House has every right to act as the arbiter on grievances of citizens and one of the grievances of citizens is excessively high rates.
This is not the only report of its type that has been debated here. In 1981–82 the Secretary of State was forced to act against Lothian council which was following a policy of sustained expenditure growth. Expenditure was then estimated to be 29 per cent. in excess of needs and rates followed a steep upward spiral. At that time, the Secretary of State proposed, first, a reduction of £53 million. He reduced that to £47 million after receiving representations. That was approved by the House in 1981. After that, the council made economies but some £30 million which could have been returned to the ratepayers
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was not returned as the council insisted on its being returned to the Treasury instead. That decision was one of the fundamental reasons for the marked shift at the local elections when the administration there was changed.
Mr. George FoulkesWhat was the reason in Edinburgh, West?
Lord James Douglas-Hamilton: The reason in Edinburgh, West is that I am here today and not a Labour Member. The hon. Gentleman's party has done remarkably badly in Edinburgh recently. He should not draw attention to that fact.
That refusal to return the £30 million was seen as a harshly vindictive attitude towards Lothian ratepayers. The Conservative administration then made it clear that there would be no compulsory redundancies when it cut the rate poundage. As the hon. Member for Garscadden said, the Conservative budget, which proposed a rate of 86·5p in the pound, was defeated. The Labour group proposed a budget that would have required 102p in the pound, and the alliance group proposed a budget for 93p in the pound. At first my right hon. Friend asked for a reduction of 8p in the pound. Many people and groups, including me, made representations to him. I am glad that he listened to them and reduced his request to 6p in the pound. The reason for taking action against Lothian regional council is that its budget is 13 per cent. above the guidelines, the highest of any region, and is well above the regional average of 7·7 per cent. More significantly, the excess has grown, compared with an excess figure for 1982–83 of 11·7 per cent., and Lothian has been consistently above its guidelines since 1980–81.
I am not sure whether I heard the hon. Member for Garscadden correctly on this matter, but Lothian has a significantly higher per capita expenditure than any other regional council in Scotland. The growth in expenditure during the past five years, at constant prices, has been more than in other regions.
Mr. Robin Cook: I regret that the hon. Gentleman has made that proposition, because he was with me last Friday when we met senior officials and councillors of Lothian region. They explained to him patiently the reason for many of the figures that he has quoted and pointed out to him then that what he has just said is not true. Lothian is not the highest spender per capita. The biggest spending region in Scotland is Strathclyde, although I do not criticise it for that. If this motion is passed, Highland region will spend more per capita than does Lothian region. There is no justification for singling out Lothian for special treatment.
Lord James Douglas-Hamilton: That is not my information, but I should be glad if my hon. Friend the Minister would confirm in reply that the expenditure per head for this year is £439·14, the average for all regional councils is £424·03, and that the average for closely comparable authorities is £403·24.
Mr. Dewar: Section 3 of the June 1983 edition of "Rating Review", which the hon. Gentleman will agree is an authoritative publication, shows that there is a substantial differential in regional services and that Strathclyde spends more per capita than Lothian. Will he also address himself to the fact that central Government grant, as a percentage of regional council expenditure, has

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decreased from 57 per cent. in 1978–79 to 40 per cent. in 1982–83. Should he not address himself to that fact when making representations to his right hon. Friend?
Lord James Douglas-Hamilton: It is more significant that Lothian is well above the regional average, and I look forward to my hon. Friend the Minister confirming the figures for per capita expenditure. I shall not pursue the matter until he confirms the facts, but I can tell the House that my information is different.
Mr. Foulkes: Where did the hon. Gentleman get it from?
Lord James Douglas-Hamilton: My hon. Friend will confirm the facts later this evening.
One fact that has not been mentioned during the debate is that the rateable value of houses in Edinburgh is often much higher than that of their counterparts in the rest of Scotland. A Wimpey villa in Dalgety bay will have a net rateable value of £300 a year, but for an identical villa in my constituency one must pay £600, which is twice as much. The rates escalation in Lothian region often bears more heavily on Edinburgh ratepayers, because in many cases the rateable value of houses in Edinburgh is much higher than it is in the rest of the region. The average domestic rates bill in Lothian of £336·43 compares with the Scottish average of £311·75, and a reduction to 86p in the pound would take Lothian well into the pack of regional councils.
My right hon. Friend is justified in taking action to protect the ratepayer. Apart from anything else, his action will help job creation. I received a letter yesterday from the chief executive of Edinburgh chamber of commerce and manufactures, who said:
"Last year's rate reduction gave a significant boost to confidence following the disastrous years of dramatic increases … By the spring of this year our invest gations indicated that we could identify 1,896 jobs which we believe to have been saved or created by the reduction … Many small or medium-sized businesses have hung on throughout the last years in a desperate battle for survival and the rate s bill, as the largest payment which many firms make, is identified as the final straw and unfortunately staff have to be released to pay this levy."
Later in that letter the chief executive explains that the chamber of commerce is co-operating in the youth training scheme as a managing agency for 250 places. If businesses are squeezed by excessively high rates, it is difficult for them to offer places to assist the necessary growth in jobs.
Jobs in the wealth-creating sector of the economy should not be destroyed by excessive rates. An example of such a company was mentioned in The Scotsman a few days ago. The managing director of Inveresk Research International Limited said that his organisation had the disadvantage of being the most highly rated research laboratory per unit of floor space in the United Kingdom. He went on to say—this point is similar to that made by my hon. Friend the Member for Strathkelvin and Bearsden (Mr. Hirst)—that he had to pay £17,000 more net rates than did a similar laboratory in Yorkshire. I have no difficulty in coming to the view that such heavy rating has an adverse effect on job recruitment.
Mr. Strang: I apologise for making this point, because my hon. Friend the Member for East Lothian (Mr. Home Robertson) had wished to make it. Inveresk research International Limited was in east Edinburgh before it moved to east Lothian. The reason for the disparity has nothing to do with Lothian's rates but is to do with the different legislation in Scotland as opposed to England.
Lord James Douglas-Hamilton: I should be glad if the hon. Gentleman would take up that point when suitable local government legislation comes forward. I am certain that if Lothian's regional rates are reduced it will substantially help that company and many businesses like it, and have a favourable effect on jobs. The evidence submitted by the chamber of commerce proves that beyond doubt. The Conservative party is safeguarding jobs, which is another reason why my right hon. Friend must act.
The background to the present position is that between 1978 and 1982 there was a massive explosion in expenditure on social work and, to a lesser extent, on education. In 1982, expenditure on social work in Lothian region was 25 per cent. more per capita than it was in Strathclyde. Expenditure per head is £68·16, which is more than £10 higher than the next highest spending region, Strathclyde, and considerably higher than the Scottish average of £55·18. This year there are about 4,000 fewer school children, so the council's desire to have 100 more teachers makes no sense. With a large contraction in school rolls this is not the time to hire extra teachers. The pupil-teacher ratio in Lothian secondary schools is the best in mainland Scotland.
Mr. Foulkes: Conservative Members send their children to Winchester and other private English schools.
Lord James Douglas-Hamilton: The region must work out the detailed economies, but I hope—
Mr. Foulkes: That is not where I send my children.
Lord James Douglas-Hamilton: We all know that the hon. Gentleman went to a private school, but he need not draw attention to the fact.
Detailed economies are the responsibility of Lothian regional council, but I hope that teachers on short-term contracts will have their contracts renewed. I understand that they have already been renewed until December. I also very much hope that, wherever possible, economies will not bite into remedial education. I have received representations from specialist teachers in my constituency. I hope that that will be taken into account.
Finally, the Secretary of State and Lothian regional council are walking a tightrope in terms of the time scale. The longer the economies are delayed, the more difficult it will be to achieve them. As each day goes by, it becomes harder to implement the economies. The more restrictive the time scale, the more difficult they will become. It is time that the uncertainty was resolved in the interests of all concerned.
7.41 pm
Mr. Robin Cook: I think that I can assist the hon. Member for Edinburgh, West (Lord James Douglas-Hamilton). The figures that he quoted were exactly the same as ours, so there is no difference of information between us. If he looks more closely, however, he will see that he was quoting the average figures for the regions and comparative regions. It is in the nature of averages—this is the way in which they are calculated—that some figures one above the average and others are below. Thus, one cannot conclude that Lothian region's per capita expenditure is greater or less than any other by looking at the average.
Looking at all the figures, one sees that Strathclyde has the highest. I make no criticism of Strathclyde. No doubt that figure is justified by the demand in its area. Next

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comes the Highlands region. Again, I make no criticism as that region has additional problems in meeting expenditure and providing services over a vast tract of land. Only then does one come to Lothian, and again there are special factors which justify the Lothian figure. I shall go into the detailed case later, but I put firmly and clearly on record at the outset that Lothian does not have the highest expenditure per head of population—it has only the third highest.
There is a sense of déja vu about this debate. This is the third year running in which the Secretary of State has sought to cut our budget by order. The most charitable explanation for his behaviour is that it must be force of habit. One is tempted to conclude that this has become an annual ritual in which the Secretary of State seeks to exorcise the evil spirits of high spending through the token sacrifice of Lothian region and Stirling district. No doubt the day will come when we shall dispense with prayers on the day of this annual summer debate and begin instead by burning straw effigies of councillors Connarty and Milligan. There is certainly no rational justification for what we are now being invited to do.
Logically, with every passing year the Secretary of State's case must become weaker. In 1981, he sucured the permission of the House to lop £30 million from Lothian region's budget on the grounds that that sum was excessive and unreasonable. The following year he returned with a similar case and, through negotiation with the council, lopped off a further £30·7 million as being excessive and unreasonable. Even allowing for the small reinstatement in the current budget, in those two years well over £50 million was removed from the budget as being excessive and unreasonable. The Secretary of State now says that there is still £15 million which is excessive and unreasonable. If that is so, the definition of what is excessive and unreasonable must have been shifted progressively the more the local authority cut into its expenditure.
The most frustrating aspect for Lothian Members rebutting the report is that we have never been offered a sensible, objective definition of what "excessive and reasonable" means. Indeed, the Under-Secretary of State, the hon. Member for Edinburgh, South (Mr. Ancram), added a new note of confusion into our attempts to understand what the Government regard as excessive and unreasonable when he said that he welcomed the expenditure on the Burrell gallery in Glasgow, but that he could not lay that expenditure aside when calculating what was excessive and unreasonable. If he welcomes it, how can he include it in his calculation of what he regards as an excessive and unreasonable total?
As my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) argued with such fluency and skill, when one considers all the objective figures for the relevant local authorities, there is no case for saying that Lothian's budget is excessive or unreasonable. We have already shown that there is no case in terms of the accounts or of expenditure. There is also no case in terms of the trend in expenditure. Lothian is out of line with other regions in Scotland in the trend of expenditure, but it is out of line in a way that undermines rather than strengthens the Secretary of State's case. Since 1981, Lothian region's expenditure has fallen by 5·5 per cent., whereas the average for all the regions has increased by 0·5 per cent.
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The only definition of "excessive and unreasonable" on which the Secretary of State can possibly be relying is that of excess expenditure over the guidelines.
There are two problems in relying on the guidelines for Lothian. First, there is the general problem that the guidelines have been subject to shrinkage in the past two years because the Secretary of State has failed to index them fully by reference to inflation. The authorities' estimates of the rate of inflation have proved more prudent and realistic than those of the Secretary of State on both occasions. The result is a grotesque situation. If the guidelines were genuinely indicative, one would expect to find as many authorities above them as below them. In fact, only three local authorities in the whole of Scotland managed to get below the guidelines, while 62 are above them.
Secondly, one cannot rely on the guidelines because they are constantly being fiddled. In the past five years, there have been four changes in the method of calculation. The most recent change—to the client group method—is the least satisfactory of all. I shall not weary the House with the full quotation from Dr. Arthur Midwinter that I gave when I intervened in the Minister's speech. I merely repeat that Dr. Midwinter concludes that the client group
"does not provide a scientific basis,"
that it is in a
"primitive state of development"
and that it is
"pernicious to use this method"
as a means of calculating the guidelines.
When I put that to the Under-Secretary of State—perhaps the Secretary of State will spare his junior for a moment—he responded with a cheap jibe about Dr. Midwinter being politically biased. I do not know Dr. Midwinter's political affiliations. I have never actually met him, although I have corresponded with him, but he is a distinguished university academic and the leading authority on public expenditure in Scotland. The Under-Secretary of State, who is in a privileged position, knows that if he repeated his allegation outside the cloak of parliamentary privilege it would be actionable. We shall see whether he has the courage to do so.
If the Under-Secretary of State argues that the report should be disregarded on the ground that Dr. Midwinter is a friend of the Opposition, I should inform him that the report from which I quoted was prepared for the Highlands regional council. I am not aware that that council is run by the Labour party, Militant Tendency or even the SDP. In that report Dr. Midwinter gives his conclusions about the pathetic inadequacy of the client group method of calculating the guidelines, which is the only basis on which Lothian's expenditure shows up as execessive compared with that of other authorities.
As my hon. Friend the Member for Glasgow, Garscadden pointed out, the guidelines for Lothian have declined, but those for the comparative regions have increased. That inevitably contrasts unfavourably with Lothian. If it is the case—there may be grounds for it—that guidelines should be shifted differently for the comparative regions than for Lothian, that blows apart the idea that these regions are comparable. The Secretary of State cannot have it both ways. The comparative regions should have the same guidelines as Lothian, or they are not comparable with Lothian. If they are not comparable, the right hon. Gentleman cannot use them to justify the criticism of Lothian's expenditure.

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The Secretary of State's case is so statistically and transparently bare and so much the result of fixing those atatistics and he is so intellectually mediocre in his reasoning, that it is tempting to spend one's time concentrating on demolishing his statistics. However, that would be wrong, for it would obscure the real consequences of what we are debatig tonight.
The first of these consequences is the dire effect on services already cut. This is the third year in which the Lothian region faces cuts, and we have already had experience of what those cuts mean. Livingston has the highest proportion of toddlers of any constituency in Scotland and I have more pre-school children than anybody else in the Chamber. [Laughter.] I am happy to withdraw that. My constituents have more pre-school children than any other set of constituents represented here.
The number of nursery school places in Lothian region has fallen in the past two years as a result of the cuts. Hundreds of toddlers in my constituency are now on waiting lists for nursery places, yet they will not reach the top of those lists before they are old enough to go to primary school. When they get to primary school, perhaps because of the level of poor pre-school education, they will in many cases need remedial education.
I could describe the reference to remedial teaching made by the hon. Member for Edinburgh, West as hypocritical, but I shall not do so. Instead, I shall call it his maivety in expressing his pious hope that remedial teaching will not be affected. Remedial teaching has already been affected in Lothian. In west Lothian the school roll has fallen by 2 per cent., and remedial teaching has fallen by 17 per cent. Those kids who need the help most are being made to suffer most under the Conservatives.
What is more, when those children leave school, half of them will be unemployed. There is 50 per cent. unemployment among school leavers. They will find the youth and leisure centres, formerly available to them, being closed. In the past month, the largest youth centre in my constituency has closed because of cuts in the community education budget. I cannot understand how Conservative Members can prate about law and order and a civilised society when their Government are making cuts that mean that kids are idle all day, without recreation facilities on which to spend their time, and then be surprised that those kids turn to petty crime.
In the light of what has already happened in Lothian region, we must ask what will happen if we approve this report? We know from the figures calculated by heads of departments that in education the cuts will mean the loss of 1,000 teaching posts, although that does not necessarily mean 1,000 compulsory redundancies. That will mean a sharp reduction in services. It will mean the loss of 272 home-help posts in a region with one of the highest proportions of elderly persons in Scotland. We already know what the Conservative administration in the Lothian region wants to do because it obligingly told The Scotsman. It will utilise fares to recoup some of this loss. Specifically, it will withdraw the bus concession to pensioners. In other words, the poor will pay more for the services upon which they depend.
Mention of the Conservatives brings me to the other real consequence of the report. It will mean a further major blow to local democracy. There is a fresh factor in Lothian's case tonight. In the past two years the budgets
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that were put forward and then amended by order by the Secretary of State were proposed by the ruling Labour group in Lothian region, because we have to admit that we failed to carry the minor parties with us. Lothian region's budget has now been so cut that all the minor parties agree with the Labour group on the importance of resisting this motion. The budget that the Secretary of State is seeking to amend by order is approved by four of the five parties in Lothian region—the Labour group, the SNP, the SDP and the Liberals. Between them, those parties not only have a majority on Lothian regional council, but a two thirds majority of the votes cast as recently as May last year. What is most repugnant is that the Secretary of State is using his majority in this Chamber to impose on Lothian region a budget that the Conservative party in Lothian could not get a majority for in its own council.
The effect of these cuts on services will be damaging enough, but we shall also lose something more precious — the ability of local authorities to be creative and innovative in the policies and services that they provide to local people. We shall damage their capacity to respond to the local demand for improvements in those services and take away the right of local communities to settle for themselves the policies to be followed by their local authorities. It is for that reason that we shall vote against the motion. If Conservative Members' rhetoric about freedom and democracy with which they deluge us during elections means anything, they should also vote with us in the Lobby tonight.
7.55 pm
Mr. Gerald Malone: The hon. Member for Livingston (Mr. Cook) ended his speech by talking about democracy. I am not a member of the Scottish family affected by this report as I come from a constituency that is outwith the three areas directly affected, and therefore I should like to deal with that point. What has been said raises matters of principle, and the hon. Member for Livingston referred to them as well.
It is wrong to suggest that local authorities have any democracy other than that that flows from this House. They are creatures of statute and we must not forget that. They exercise functions that are delegated to them by the House. It is constitutionally correct to say that they must exercise these functions within the guidelines laid down by the House, both statutory and, in terms of the powers that the House has given itself, financial as well.
Tonight, we are dealing with the relationship between the House and local authorities, and a misconception that is held about their role by Labour Members. That relationship has been recognised by most of those on the Labour Benches. It was recognised in 1966, albeit in a slightly blunter form, when Labour Members adopted the same type of legislation in principle as we are trying to adopt tonight. Nothing has changed. Local authorities are still the creature of the legislature and that cannot be changed. We are entitled — I wish to get this point clearly on record—to supervise them in what they do in the general levels of their expenditure.
Mr. Michael Meadowcroft: Does the hon. Member accept that, whereas the constitutional facts are as he states, the electoral process is also crucial to the democratic health of the country, and members of the public have the chance to cast their votes, just as they cast their votes for Members of the House? The people of

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Lothian cast their votes overwhelmingly against the policies that the Government are now trying to enforce, through the House, on Lothian regional council.
Mr. Malone: I cannot accept that, because it is founded on a basic misconception. People are elected to regional and district councils in Scotland to carry out the functions given to them by statute created in 1973. It is as simple as that and that point cannot be ignored.
We must take the shades from our eyes and realise that this is not just a one-off issue. It is the end of a long struggle by not only this Government since 1979 to try to control unreasonable expenditure but by the Labour Government to impose strictures on local government when it was thought that spending was getting out of hand. It is clear that Lothian spending has got out of hand. A rise of 154 per cent. in rates since 1978–79 is too much in the Lothian region or any other region. On that scale it is right that the House should intervene to protect the ratepayers.
I was interested to hear various points that were made about electors and the local authority dictating the overall level of expenditure. The point is that many electors do not pay those rates. When it comes to defending those who pay them and when electors start to suggest policies that get out of hand, it is up to the House to exercise its correct and clear function to protect them. That is what the Government are doing tonight.
Mr. Dewar: I accept that a local authority must obey the laws passed by the House and operate within them. No one would argue with that. But that is no excuse for the House passing bad laws and treating local democracy insensitively, which is what these measures do. The hon. Gentleman should address himself to the question which has not yet been answered. In view of the high rates about which he is complaining, why does he approve of a Government policy which has seen central Government grant as a percentage of Lothian council's expenditure fall since 1978 from 57 per cent. to 45 per cent.? Assuming that services have remained almost static, that means that the unfortunate ratepayer has had to find about another £50 million in rates as a result of the Secretary of State's actions.
Mr. Malone: The hon. Gentleman is always at his most persuasive when he puts forward half an argument. My reply is simply that Governments have tried over the past few years to encourage local authorities to reduce their spending. In fact, local authorities pass the buck to the ratepayers and that is what the Government are now trying to stop. It comes ill from the hon. Gentleman and the Opposition Front Bench to argue as they do. I suspect that they are suffering from a case of envy, because the blunt instrument that they created in their legislation of 1966 did not work. The instrument that we are legislating tonight is more refined and will tackle the problem. At the end of the day the Labour Government found that their legislation did not achieve what they wanted. They found that rates could go up regardless and that they had to penalise authorities which exceeded expenditure as well as those that did not. This legislation is effectively designed to put the blame back where it belongs — on those councils that are overspending. That is why we do not want to continue implementing the type of legislation that was passed by the Labour Government.
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This is not a matter of central Government attacking local authorities. It cannot be ignored that in many cases in Scotland a reasonable compromise has been reached. Local authorities have recognised that the Government have national objectives and public spending guidelines to which they must accommodate themselves. I must suggest a slightly uncharitable construction on the attitude of those authorities that we are debating tonight. It is that they are determined to break the Government's national economic policy. They are determined to do it step by step. The reduction in expenditure that we are discussing might not be very much on its own, but nobody can deny that it is part of a pattern. If the Government ever gave way there would be a flood of increased expenditure, which the country could not afford.
Mr. Foulkes: The hon. Gentleman is clearly an economic expert. How will the expenditure of an extra £18·5 million break the British economy when, in the current year's Estimates, the Government will spend £624 million on fortress Falklands?
Mr. Malone: If the hon. Gentleman would do me the courtesy of listening to what I say, he would realise that that is a foot in the door. There have been feet in the door from these regional and local authorities time and again. If ever the Government's resolve gave way, we should find an ever-increasing escalation of expenditure from those authorities.
If the relationship between central Government and local authorities is breaking down, it is because of the persistence of those local authorities in refusing to compromise with the Government. It is the Government's duty to protect not only public spending but those local authorities which have fairly agreed to work with them. That is why we have to pass these measures tonight. It would be grossly unfair to regions such as Grampian, in which my constituency lies, if we were not to take this action. Therefore, the measures should be supported.
8.5 pm
Mr. Malcolm Bruce: I am amazed at the speech of the hon. Member for Aberdeen, South (Mr. Malone) but I suspect that he has revealed some of what the Secretary of State would prefer not to reveal and that is the real objective behind the measures before us tonight. The Opposition will be voting against them because they cross a threshold inasmuch as they are quite different from anything that has been presented before. It is legitimate for a Government to say that they must control what they are prepared to give to a local authority. It is legitimate for the Government to say that they must control their borrowing. That affects the national economy. But it is not true that what local government chooses to raise itself to spend on its own services affects the national economy. Local government is self-contained and self-financing. The money is raised and spent.
Mr. Bill Walker: If the hon. Gentleman cares to look at the services provided by other Government agencies, Departments, and quasi-Government bodies in the Lothian region which are funded by the Government, he will recognise that any increase in the rates of the Lothian region could mean an increase of over £1 million for the health board. He will realise how the problem is compounded and why the Government have to take action.
Mr. Bruce: Rates that are raised by local authorities to supplement their spending are self-balancing. The Government control borrowing and that is legitimate and right. The measures before us now take a step across a threshold that should not be crossed.
What makes the Scottish Office think that it knows Lothian's needs better than its people, officials and councillors? It is only 18 months since we have had local elections, at which those needs were presented. The road down which we are moving started, perhaps understandably, when colleagues of Labour Members in the Lothian region pursued a reckless budget, which presented the Government with a problem that had to be dealt with. The Lothian electorate has resolved that problem by turfing out that administration and electing a new council, which has responded positively by cutting the rates by 20p over the past 2 years. To say that that is not a reasonable and moderate reaction is not to be interested in the views of the local people of Lothian as expressed by the council.
The hon. Member for Glasgow, Garscadden (Mr. Dewar) pointed out that every item of Lothian's budget was voted through in 146 votes, and it represents a bigger percentage of voters' support than any element of the Government's manifesto that will be implemented in the House in the next four years. The main problem of pursuing this line of thought is that the Government have made moderation an unacceptable course of action.
What incentive has there been for Lothian to reconsider its budget and put forward a new and reasonable budget that represents the views of most parties and the majority of voters if it is to be kicked in the teeth for doing so? The consequence will be to suggest to parties other than the minority Conservative party that there is not much point in participating in Lothian region politics because they will be overruled. That suggests that we are moving into an era of comtempt not only for local democracy but for democracy as a whole.
The Government attitude is that democracy is fine provided they and their mates finish up top of the heap. If they do not, they will change the rules, say "To hell with democracy" and do it their way. That attitude discredits local elections and local participation in local government.
Taking power to the centre creates a dangerous precedent. It is opening the door for a regime without democratic beliefs. Centralising power gives such regimes much easier means of control. Already one of the great weaknesses of our constitution is that we do not have a system of checks and balances. Undermining local government takes away one of the existing checks. It makes more and more people say, "What is the point of participating in the democratic process?".
The hon. Member for Edinburgh, West (Lord James Douglas-Hamilton) is on dangerous ground when he talks about jobs.
Mr. Dennis Canavan: The hon. Gentleman is always on dangerous ground.
Mr. Bruce: He said that the chamber of commerce had identified 1,800 jobs that had been saved because of rate reductions. Yet the report before us shows that Lothian regional council lost 2,088 jobs because of cuts. That is hardly an overall net gain.
Local authorities actually spend money on local businesses. Because they have had to cut that expenditure, many firms have lost council business and some have even
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ceased trading. It misleads the House to suggest that there is no relationship between council spending and private enterprise. Conservative Members say that they want business put out to private tender, which is an acknowledgement that councils have worthwhile business to put out. The Government cannot have it both ways, although they try to do so.
The report reveals the Secretary of State's true ambition. He really wants to be the convenor of Lothian regional council.
Mr. Canavan: The Marquess of Lothian.
Mr. Bruce: The Secretary of State could resign his seat in Ayr, stand for election to the Lothian regional council and pursue his policies. The advantage of that would be that when he inherits his title and moves to another place he can keep that job. If he intends to put further orders of this sort before the House, I wish that he would make that move sooner rather than later.
8.13 pm
Mr. Ron Brown: We all know that Parliament represents class interests, and that is even more true since the general election. The Government have a substantial majority, but that does not mean substantial support throughout the country. The case put forward by the Secretary of State was predictable — bad but consistent. We have recognised for some time that he has thrown moderation, caution and reason out of the Tory window. Tories do not consider such virtues any longer. They want to solve the economic crisis at the expense of the working class.
Let us consider the Government's tactics. First, they attack real wages and living standards and then move to social services, local services and local government. They speak of local services as though they were charity. They are not charity, but something that we have fought for over the years. All of us, especially working people, have earned those services and have the right to see them in operation.
Tories claim that Tory freedom works and that their system of society means something. It certainly means something to big business, which backs the Tory party and benefits from Tory policies. The Tories sometimes condemn luxuries and frills in local government yet the one luxury left untouched is interest payments paid as tribute to the City of London. The Government can destroy everything, send people to the breadline and the soup kitchens, but interest payments must be maintained and improved. That is the nature of the society in which they believe.
When individuals say "Whoa" and claim that Government policies are unfair, the Government say that they believe in democracy. But democracy for the Tory party is like a piece of chewing gum — it can be stretched one way or the other.
Mr. Deputy Speaker (Mr. Ernest Armstrong): Order. A number of hon. Members wish to catch my eye. The hon. Gentleman must relate his remarks to the order.
Mr. Brown: We are talking about democracy, which affects local government. If it does not, there is something wrong with this Chamber. I say that with all respect to you, Mr. Deputy Speaker. Let us not be kidded—democracy

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affects local government. The Government thinks that it is a piece of chewing gum that can be stretched. They stretch workers' rights.
The Government have no mandate in Scotland. They may have a mandate elsewhere, but not in Scotland. They sell their ideas through Saatchi and Saatchi and do all sorts of clever things, such as using slogans. I think that the latest was "Cheer up, the Tories are coming". No one is cheering in my area, and certainly not the unemployed, the disadvantaged, the disabled, the young and the old age pensioners. The only people cheering are the skinheads of big business, the CBI and, perhaps, the chamber of commerce in Edinburgh, which has been much quoted tonight. Those are the only people who count for the Tories. It is all to do with the class nature of politics savoured by the Tory party.
The Tories and the CBI represent the capitalist system. That system is unfair, inefficient, corrupt and dangerous. It is unfair because wealth is concentrated in fewer and fewer hands. It is inefficient because of the waste of resources, especially human resources. It is corrupt because of the behaviour of those with vested interests, such as the Vestey family. It is dangerous, as proved by recent events in the South Atlantic and the so-called defence policy.
Lothian Labour councillors have been vilified by the media because they have stood up for the principle that human need is important. They have been challenged by the Secretary of State. They have had to suffer much but principles are important to our movement. We in the Labour movement do not worry when we are attacked by the Tory press. If we are praised by the Tory press we cannot be doing our job.
We hear a great deal about Lothian region overspending, but Labour councillors invest in people. Is that not important? The Government spend a great deal of money on nuclear weapons—that is another argument but it is not an argument of the Labour party. Today in Lothian region Labour councillors are not in charge. The Tory-SDP alliance are in charge and it is trying to work out a compromise. It is agreeing to introduce policies that the Secretary of State wants. That means effectivelyy that it is doing the Tories' dirty work. Those councillors give all sorts of explanations for their actions but they are cutting back. The cutbacks are not as severe as the Secretary of State would like to see but ordinary working people in my area are affected.
We know that the Secretary of State has a hit list and that the number one target on the hit list is Lothian.
Mr. Canavan: The Marquess of Lothian.
Mr. Brown: Some people will say that a rate refund is fine but a rate refund does not mean anything for the average person. The rate refund is a "con" job because it means that services and jobs that are so important in Lothian will be affected. The Government talk about cutting away the fat but we know full well that the fat is not there. They are cutting away the limbs of local government. That story could be repeated throughout Scotland. Many things have been said but essentially the story remains the same. Our constituents can better explain the issues. I have received a letter from a Mrs. Anne-Marie West. I shall not quote all the letter but it contains an important passage which says:
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"I ask you, please, to think of the children whom we teach and who cannot stand up for themselves. Surely, they must be protected. Mr. Younger must see that his demands are unreasonable. Lothian Region has made a great many cuts during the past two years, and has reached a stage where it can cut no longer without drastically hurting those who rely on the services provided by the region. How can the Government possibly justify such an increase in the defence budget, while our children cannot receive a proper education and old and sick people cannot receive the care and treatment they deserve?
I ask you to vote against Mr. Younger on this subject and to make known the feelings against such stringent cuts in the Region."
There speaks the voice of reason; there speaks the voice of Lothian; there speaks the voice of the working class. That voice must be heeded. We talk a great deal about democracy but that is the voice of democracy. Whatever the politicians may say in this Chamber, that is the voice of the ordinary people of this country. It can be heard in England, Wales and Ireland as well. That is the statement that matters. If it does not, what do we have? We have the alternative of Big Brother Younger, the Secretary of State, taking over-1984 is just next year. Is that what we are offering the electorate of this country? Is that what is on the menu? Unless we fight for democracy we are not entitled to have it.
We can speak of many things in this Chamber but democracy was carved outside. It was carved from the struggles of ordinary working folk. It came from the struggles of the last century of the Chartists, the early trade unionists, the Labour party and the suffragettes. We will have the ritual dance where people will jump up and down this year and next year moaning and groaning and saying that things are going from bad to worse. That is the problem with British politics. We are conned into thinking that this is a marvellous place, that this is the centre of the political universe. It is not, but the lessons must be learnt and the Labour party must learn them or it will not get back into power. If it wants to struggle in local government and fight back against the Tories, it must be active on the street corners and at the factory gates. The Labour party must get its act together. It can do so only on a matter of principle and by building up real leadership at all levels, particularly at the basic level, on an understanding of politics and on understanding what socialism is about.
Mr. Bill Walker: On a point of order, Mr. Deputy Speaker. I believe that it is correct to draw your attention to the fact that we are not here this evening to debate the problems of the Labour party. I understand that we are debating a report as it affects Lothian region.
Mr. Deputy Speaker: The debate has gone a little wide but it is related to the Government's proposals about rate reductions in Lothian. I hope that the hon. Member for Edinburgh, Leith (Mr. Brown) will relate his remarks directly to the report.
Mr. Brown: That is correct, Mr. Deputy Speaker. I again emphasise that democracy in this Chamber is related to democracy outside.
Mr. Deputy Speaker: Order. The report before the House relates to the Secretary of State's decision to reduce the rate. We must discuss the merits or demerits of that proposal.
Mr. Brown: With respect to you, Mr. Deputy Speaker, it is important to appreciate the sense of feeling among Scottish Labour Members who have been elected to the

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House and have been outvoted, despite the tremendous support and mandate that we have in Scotland. We feel angry, frustrated and bitter. You can understand why, Mr. Deputy Speaker. When we are arguing these points about outside activity, it is not a gesture, but a facing of reality. That reality will, of course, affect other areas. It will affect the north of England, Merseyside and elsewhere. I am not a nationalist—I am a Socialist but the front line at the moment is local government. Local councillors are defending what we have fought for consistently over the years. We are fighting for the welfare state. We are making pertinent points to the Secretary of State, which must be listened to. If they are not listened to in this Chamber, they will certainly be listened to elsewhere. That is the role of Socialists. We Jo not mourn. We organise. That thought is not original to me; it was said by Joe Hill and it still prevails. Socialism does not belong to me or to individual hon. Members here. Socialism belongs to the whole country. In particular, it belongs to those who are fighting against injustice.
8.29 pm
Mr. Alexander Eadie: Although I have been present since the beginning of the debate I shall, in the interests of my hon. Friends, curtail my remarks.
This has turned out to be a strange debate, because we have a new definition of the democratic role of local councillors. They will not take kindly to being told that they are creatures of this legislature. Ministers have always adopted the attitude that electors, if they did not like a local administration, would exercise their democratic right to elect a new one. Now, apparently, we have a change in Conservative thinking about the role of local government.
It is ironic, when discussing a measure affecting the Lothian region, to lump the other local authorities together and suggest that there is some clandestine plot to defeat the economic strategy of the Government. It is stretching imagination rather far—I thought that Mick McGahey had been relegated — to suggest that those who are trying to overthrow the democratic rights of the Government are involved in local government—those affected by the proposals. That is ridiculous.
It has been said that the report would not make any difference to the existing local government services. I was interested in the remarks of the hon. Member for Edinburgh, West (Lord James Douglas-Hamilton) and the figures that he gave. I should like to debate them with him —perhaps on another occasion—but I shall not delay the House now. It is ridiculous to suggest that the education and social services will be able to continue much as before. I hope that the Government will not adduce that argument. It is clear that the proposals will have an impact, and I shall give an example of what will happen should hon. Members be so foolish as to agree to what the Government are proposing.
I have here a letter from an elderly constituent. I will not name her—I will call her Mrs. X. This is a good example to bear in mind. Think of the elderly who want to live in their own homes but who depend on the back-up services especially the home help service as, in the twilight of their lives, they wish to have the dignity of living in the house in which they have lived for many years. Sometimes that demands great effort on their part, and often they need help.
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My constituent had a home help. On becoming ill, my constituent went into hospital. After treatment and with courage and willpower, she felt able to return to her own home. "I want to sit at my own fireside," she said, having battled for six months to prove to the doctors that she could look after herself. She did not want to be hospitalised in the twilight of her life. She returned home to discover that the home help service had been withdrawn. I took the case up with the social services department, and the reply I received from Lothian regional council was that she
"is receiving less service than before her admission to hospital. We are not happy about the reductions in services to clients but unfortunately to keep within budgets we have no other option but to reduce services while trying to offer enough service to maintain the clients at home."
That is the position before we introduce financial cuts for the Lothian home help service. It has been suggested that 250 home helps will go if the report is implemented. The situation would become worse. It is dispicable that this lady is receiving only one hour of home help each day. I wonder whether it will be withdrawn.
The provision of social services in Midlothian is bad enough, but if the House is foolish enough to agree to the Secretary of State's motion, the position will worsen and a great disservice will be done to the sick and the elderly.
8.36 pm
Mr. Gavin Strang: I am happy to follow my hon. Friend the Member for Midlothian (Mr. Eadie), because his example effectively reveals the result of the Government's expenditure policy in the Lothian region. Later, I shall amplify some of his points about the home help service.
At the heart of the debate is the Government's policy of cutting public expenditure and social services and destroying public sector employment. It is fitting that we should debate this matter when we know, from leaks in the newspapers, that the Cabinet is contemplating additional expenditure cuts of hundreds of million of pounds. The Times—I heard it on radio as well—reported that the head of the CBI, Sir Terence Beckett, said:
"The state is swallowing us up; something has got to be done."
What sort of gobbledegook are we hearing from these people? We have a massive amount of under-used resources and million of people, many of them highly skilled, who want to work. It is nonsense and an insult to their intelligence for the heads of big business to lecture and say that the public sector should be cut back so that they can expand. This policy is misguided.
This country will not return to work nor will our economic problems be solved if we cut expenditure and public investment. These cuts are having a disastrous effect on the British people. That is the first issue of principle in this debate. It will be a sad day not just for the people of Lothian but for those in other parts of the country if we have another four years of such policies.
The second great issue of principle in this debate is democracy, as you, Mr. Deputy Speaker, well know. We are talking about a direct assault on local democracy. One of the great economic and social developments during this century has been the growth of local government with the provision of council housing for people who lived in homes without basic amenities, such as indoor toilets and bathrooms, advances in the education service — for example, nursery education — the provision of home helps and services for the mentally handicapped. It has

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meant an enormous growth in the budgets and the importance of local government. Fundamental to that is the principle of local democracy. Elected councillors, who have played a crucial role in recent decades in looking after the economic and social well-being of our country, can decide what is best for the people in their areas. It is fundamental to our way of life that these services should be provided and democratically controlled locally and not dictated and provided from the centre.
We are seeing the principle of local democracy undermined. As my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) said, the Government are turning local government into the agents of central Government. It is utterly irresponsible of the Government to enforce Tory party policy on the elected Lothian regional council for the sake of a small amount of money when only 22 of the 49 councillors are Conservative. They were elected just over a year ago.
It is nonsense for Conservative Members to say how committed they are to local democracy. It does not mean anything when one realises the lengths to which they are prepared to go in Lothian to cast aside the principle of local democratic control.
Conservative Members must learn—my hon. Friend the Member for Midlothian made the point effectively this evening — what these cuts mean to the people of Lothian. The hon. Member for Edinburgh, West (Lord James Douglas-Hamilton), in particular, must learn, because he had the effrontery to say on 4 July in a debate in which we both took part:
"services will be adequately maintained, I believe that ratepayers are entitled to be fully protected against unreasonable increases, especially as the employment prospects of many are tied up with keeping the rates under reasonable control."—[Official Report. 4 July 1983; Vol. 45, c. 123.]
The hon. Gentleman was talking about a grandiose social works department. He was saying that cuts would be made without any real reduction in services. We know what the cuts mean to services. My hon. Friend the Member for Midlothian described the experience of one pensioner as a result of the cut in the home help service. In reply to a question only this week from councillor Nolan, Labour spokesman on social work of the regional council said that as a result of the cuts the number of home helps have been reduced from June 1981 to May 1983 by 288 full-time equivalents which, in fact, means around 600 home helps. Those 600 home helps serve about 1,500 people. As a result of these cuts, 1,500 people will suffer in the way described by my hon. Friend the Member for Midlothian. If time allowed, I could give examples of the types of peole who are suffering from cuts in the home help service. They are people suffering from cancer, leukaemia and other disabilities.
I do not know what sort of a world some hon. Gentlemen live in. The Opposition have been inundated with letters about the effects of the cuts from organisations and I assume that they are writing to Conservative Members as well. They include the Lothian association of youth clubs; the campaign against reducing expenditure in Lothian, which is worried about all services, and the campaign with specific reference to primary school remedial teachers, which my hon. Friend the Member for Livingston (Mr. Cook) mentioned. If time allowed I could cite many more.
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There are cuts in music provision. We are reaching the point, at which there will be no music teaching in primary schools and not much in secondary schools. One of my constituents asked in a letter a week ago whether there would only be opportunities for music for kids in Edinburgh who go to fee-paying schools. Is that what the Government are trying to achieve? I could giving examples of the cuts imposed on and hardships suffered by the people of Lothian. The idea that we should have more cuts as well is utterly unacceptable.
I want to touch briefly on some of the narrow reasons why it is unfair for the Government to single out the Lothian region in the way that they have done. First, there is the matter of the guidelines. They are based on what are supposed to be objective criteria, involving the concept of client groups but they are rough and ready guidelines. When the main reason for a local authority being over the guidelines is not that expenditure is going up but that the guidelines are going down, we should surely give it the benefit of the doubt, particularly when the expenditure involved is not very much. The fact that the guidelines are going down is the most important reason why the Lothian regional council is in excess of the guidelines.
Secondly, there is the question of the high investment that has been made. Whether we like it or not, we have built the new sewage works. Whether we like it or not, we have made a certain amount of provision, and we have to man that provision. We have to accommodate the revenue costs. To ignore that, or virtually to ignore it, is nonsense. The idea that our children should not have the opportunity to learn music at school because they have a sewage works which incidentally, other authorities should have provided is outrageous.
Cuts on top of cuts make the situation worse. The fact that the budget has already been cut by £53 million, and the fact that thousands of public sector jobs in Lothian have already been destroyed—over 3,000 jobs have gone—makes the additional cuts even harder.
Then there is the argument about the rate burden. It does not stand up, when one compares the rate poundage in Lothian with Strathclyde and other authorities. When one takes an average house in Lothian—not the very selective example that was given by the hon. Member for Edinburgh, West of a bungalow at Dalgety bay—and compares it with an average house in Strathclyde or other areas, one finds that the rate burden per household is not excessive.
Finally—and perhaps the most fundamental point of comparison—there is the level of public expenditure per head of the population. Once the cut is made, the Lothian region will be fifth out of nine. The Highland region, Strathclyde region, Tayside region and the Borders region will be spending more per head of population than this so-called high-spending regional council if the motion is accepted.
There is no case for what the Government are doing, even on the narrow criteria on which they seek to justify their actions this evening, and it is an affront to the House of Commons that we should have to deal with these motions.
8.47 pm
Mr. John Home Robertson: Like my hon. Friends the Members for Midlothian (Mr. Eadie) and for Edinburgh, East (Mr. Strang), I am desperately worried about the impact of the cuts on people throughout

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the region and in my constituency. Old persons, children and people living in remote communities suffer enough already, without having further cuts in services imposed on them.
Again like my hon. Friends, I am also concerned about the attack on the principle of local democracy. I was astonished that the hon. Member for Aberdeen, South (Mr. Malone) should suggest that local authorities were creatures of central Government. He said that they were like quangos—like the Scottish Tourist Board or the Highlands and Islands Development Board. There is a difference between quangos and local authorities. Local authorities are elected, and they exercise responsibilities according to the mandates that are given to them by their electorates.
I speak with some minor experience, having been a local authority councillor in the district of Berwickshire before being elected to this House. I remember taking part in the budget-fixing exercises every year and the striking of the rate. When I resigned from that local authority and came here, I never imagined that I would be involved in the striking of a local authority rate in this place. That is what we are doing this evening. We are fixing the budget, the rates, for Lothian regional council, and for three other local authorities. That is extraordinary. It would be laughable if it were not so tragic.
It is particularly laughable since the Government are constantly talking about over-centralisation and excess government. The Government have, in effect, created a third tier of Scottish local government. The Secretary of State has taken powers to intervene directly to fix the rates in Lothian and elsewhere. For the Lothian region this is the third year in which we have been through this process, and no doubt the same will happen again.
The House has the power to impose on local authorities the responsibility for providing local services. The House is now exercising another perverse power to restrict the money that can be made available for the provision of services. While taking the powers, the Government refuse to take any responsibility for local authority functions. The responsibility still lies with the local authorities and councillors. Kipling said about that:
"Power without responsibility — the prerogative of the harlot throughout the ages."
We constantly remind ourselves of the sovereignty of Parliament. Tonight, the Government are asking the House to exercise the sovereignty of the harlot in respect of a number of local authorities in Scotland. They are using the power to cut the budget without accepting responsibility for the consequences.
I understand that a number of local authorities asked the Secretary of State which services he thought were excessive and unreasonable. In response the Secretary of State had the gall to say that it was up to the local authorities to decide. In spite of him seeking to fix the rates, he is not prepared to say what services should be cut. He wants local councillors to take that responsibility and to accept the odium that goes with the cuts. They must choose whether to inflict the cuts on children, old people, commuters or someone else. Who on earth does the Secretary of State think he is?
I have been criticised recently for saying that the Secretary of State has no mandate to govern Scotland. I stand by that. The Secretary of State is attacking local authorities when he should be working in the Cabinet to protect Scotland's interests in the face of public
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expenditure cuts. What is happening today shows up the Secretary of State for the Quisling that we all know he is. Even those who are unhappy about the national mandate argument must accept that the Secretary of State has no mandate to tinker with local authorities' budgets in Scotland.
Lothian regional councillors have taken their decision. They have taken into account the severely restricted rate support grant. They have assessed the needs of the people whom they represent and reached their own conclusions about the necessary budget and levied a rate accordingly —92p in the pound. That is 1p in the pound less than it is for the Strathclyde region and not far from the national average. Someone in Dover House or Whitehall has come to the conclusion that that is excessive and unreasonable, without saying why or going into detail.
I have had my say about the vagaries of the rating system. There is no doubt that rates are a considerable burden, but that has been aggravated by regular cuts in rate support grant and by continuous manipulation of the guidelines by the Secretary of State for Scotland. Despite that, four of the five parties on the Lothian regional council have come together to reach a compromise package that they believe appropriate to fund a tolerable level of services in the region. I suggest that that package was modest. It is demonstrable nonsense for the Secretary of State to describe it as excessive.
I should like to describe briefly some of the levels of service in East Lothian district, in the constituency that I represent. I am not the first person to have to assess the needs of East Lothian district. Between February and October 1974 the hon. Member for Edinburgh, South (Mr. Ancram), now the Under-Secretary of State, was the Member of Parliament for Berwick and East Lothian, which included most of East Lothian district. He circulated an election address in October 1974, which listed several of the things for which he was fighting for additional expenditure in East Lothian. On the subject of private housing improvement grants we saw the headline:
"MP joins grants fight."
Another headline ran:
"Central Government should subsidise festivals, says Ancram."
That would go down well with the Musselburgh Honest Toun's Association. He was actually suggesting that such festivals should be subsidised by central Government.
Another headline stated:
"Public transport needs immediate help, says MP".
I can tell the hon. Gentleman that things have not changed. Public transport in East Lothian is still pretty ropey. It needs to be improved, not cut. The hon. Gentleman said that it needed to be improved then, so why on earth does he tell the House that he wants to cut it now? Another headline said:
"MP stresses urgent need for more houses."
I could go on and on.
The point is that East Lothian still has pressing needs, and the recent cuts in services that have been imposed with indecent enthusiasm by the hon. Gentleman and by the new minority administration of Lothian region have made matters even worse than they were then. I could speak about cuts in the bus services and the threat that they pose, in particular, to the remote communities in my constituency. I could also talk about the further erosion of the concessionary travel schemes which are being threatened in Lothian region. I could mention the great

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stress under which our home help service is operating, but my hon. Friend the Member for Midlothian has already mentioned that. Instead, I shall concentrate on the subject of education.
The greatest protests in my constituency concern the fact that Lothian region has already imposed sever cuts in teaching staff, in both secondary and primary schools. One of the small village schools in my constituency, at Humbie, is under threat of closure. Seven village schools with rolls of under 50 may be under threat of closure in East Lothian. Other communities, such os Ormiston, Wallyford, Prestonpans, and East Linton, have experienced cuts in the number of teachers that are more severe than are justified by the fall in pupil numbers. If the Minister wants me to quote figures, I shall be happy to do so, because I have plenty with me. However, I think that the House wants to make haste.
Campie school in Musselburgh already has the minimum pupil-teacher ratio. If there is any increase in the number of children in that catchment area during the course of the year, those children will have to be bussed to another area. The school has reached saturation point because of the cuts in the number of teachers. Meanwhile, inordinate numbers of teachers are on the dole. The situation is obscene.
The Government seek to set the seal on that miserable package of cuts and to make it worse. They want to impose £11 million of cuts on Lothian region, which represents 6p on the rates. About £6 million of that £11 million will presumably come out of the education budget. There is no justification for any of those cuts. I have received dozens of representations from all over my constituency. They have been made, in particular, because of the threat to schools, and also because of concern about other services. The message is clear. People are more interested in protecting the standard of education and other services than in having a rate refund equivalent to about 19p per week per household. It is just not worth it, as those in my constituency and elsewhere in Lothian recognise.
When the Division bells ring, droves of Conservative Members for English constituencies, who have probably never heard of Lothian region and do not even know where it is, will pour into the Lobby to inflict unwarranted and unwanted cuts in the standards of services to my constituents. About 200 of them did that when the previous Division took place, and presumably they will do so again when we divide on this issue. They have certainly not been in the Chamber listening to the arguments as the debate has proceeded. If the 200 or more English Conservative Members support the Government in their Lobby, they will cause considerable distress in my constituency and add to the discredit that the Secretary of State has already brought upon the House. I hope that they will not do so. However, I am confident that the overwhelming majority of Scottish Members will vote against the Government.
Mr. Bill Walker: On a point of order, Mr. Speaker. Is it in order for an hon. Member to describe my right hon. Friend the Secretary of State as a Quisling?
Mr. Speaker: That is not a parliamentary term. I was not in the Chamber when it was used.
Mr. Walker: I only wanted to know whether it was in order.
Mr. Canavan: It was not strong enough.
Mr. Speaker: I know that Scottish debates are good humoured—
Mr. Home Robertson: Not this one.
Mr. Speaker: I hope that it will be good humoured from now on. I think that enough has been said on that point of order.
9.1 pm
Mr. Charles Kennedy: I know that Scottish debates are good-humoured, but I shall be brief in making my contribution to the debate and I shall not push my luck. I am anxious to participate in the debate on behalf of the SDP—
Mr. Canavan: The hon. Gentleman is the first SDP Member to do so.
Mr. Kennedy: My hon. Friend the Member for Gordon (Mr. Bruce) has addressed the House on behalf of the Liberal party. Given the delicate balance of power in the Lothian region, of which I am sure the Secretary of State is only too well aware, it is appropriate that the other half of the Alliance should make its contribution.
Mr. Canavan: Where is Jenkins? Where is he?
Mr. Kennedy: When the hon. Member for Falkirk, West (Mr. Canavan) was not in the Chamber my right hon. Friend the Member for Glasgow, Hillhead (Mr. Jenkins) made an excellent contribution to the debate. I am sure that the hon. Member for Falkirk, West will do so later.
When we received a briefing this morning from the Lothian delegation, it was clear that it was looking beyond this debate to the future. There is a great deal of doubt and confusion about "excessive and unreasonable expenditure". The Lothian representatives are disappointed that the Secretary of State has not been more specific and has not clarified the matter more fully. They said that they felt that they were up against a brick wall in trying to get more specific information from the Scottish Office and in seeking further clarification.
We know that the Government will secure a majority when we divide at the end of the debate and that the measure will pass through the House. However, I hope that in future they will make every attempt to ensure that confusion and anxiety do not arise again should this sort of issue emerge once more in respect of the Lothian region or other authorities. I put that to the right hon. Gentleman in a constructive manner.
The hon. Member for Edinburgh, West (Lord James Douglas-Hamilton) spoke about the need for compromise. I was interested by the measure of application that he gave to that term. On 4 July the hon. Gentleman said in reply to the hon. Member for Glasgow, Garscadden (Mr. Dewar) that
"compromise is the essence of politics."—[Official Report, 4 July 1983: Vol. 45, c. 122.]
I could not agree wih him more. Indeed, the hon. Gentleman was echoing the words of one of the most distinguished members of his party in bygone years, the late Mr. R. A. Butler, who described politics as being largely the art of the possible.
The Government are facing a contradiction in the report on Lothian regional council. We have a shining example there of political compromise and an excellent example of adaptability and agreement being reached on a budget by

643
locally elected representatives. Instead of accepting that expression of local opinion and that compromise budget, the Government will reject it and try to penalise the regional council when they use their majority in the Lobby. That is a disturbing trend, particularly when one thinks, as the hon. Member for Glasgow, Garscadden (Mr. Dewar) said, that it took 145 votes to pass the previous motion. Heaven knows, after the number of votes cast this week over our wage claims, that is a large number. Despite the tortuous process, the Secretary of State is now introducing this measure to penalise the regional authority. It is sad.
I repeat my plea that in future there will be as much cooperation and flow of information between the Scottish Office and the regional councils as possible. Furthermore, I hope that the Government will realise the contradiction with which they are faced. On the one hand they are supporting nationally a philosophy of rolling back the parameters of the state, yet on this occasion, when local democracy has made a compromise decision, which has been accepted, they are extending the powers of the state to penalise the authority. That is disturbing. The alliance regrets it and hopes that it will not need to be repeated in future.
9.6 pm
The Under-Secretary of State far Scotland (Mr. Michael Ancram): I listened with a great deal of attention to the speeches in this full debate. I shall try to sum up and deal with some of the points that were made reasonably briefly.
The hon. Member for Ross, Cromarty and Skye (Mr. Kennedy) accused both my right hon. Friend the Secretary of State and myself of putting up a brick wall against the council's request for clarification. The people in the council who had made the compromise, as the hon. Gentleman called it, visited us. We listened to their submissions and made an adjustment to the rate reduction demand that my right hon. Friend originally proposed. I would have thought that that was a sign of the way in which their submissions were listened to and their arguments given due weight. If anything, the consultation with them and the flexibility shown by my right hon. Friend give the lie to the accusation that we have been inflexible or that we have not been prepared to listen.
I hope that hon. Members will forgive me if I do not go into the particular services that they mentioned. It is not for the Government to go into them—
Mr. Canavan: Why not?
Mr. Ancram: If I were to go into the services and say where I thought economies should be made, I would be accused of undermining local democracy. It is for local authorities to make up their minds on that.
I listened with great interest to the speech of the hon. Member for Edinburgh, Leith (Mr. Brown). I learnt a lot about the internal workings of the Labour party in what I took to be an ideologically pure speech. He referred to the needs of his constituents. I was given a letter this morning written to the convenor of Lothian region from a company in the hon. Gentleman's constituency called Unitank Storage company. As he is interested in his constituents, he might be interested to hear what was said in the letter. That company operates a bulk liquid storage installation
644
at the Imperial dock, Leith. I am sure that the hon. Gentleman knows about it. The divisional managing director wrote:
"I am writing to tell you how pleased we are to see the change in policy of the Lothian Regional Council and how much we appreciate your efforts in reducing the rate burden. The rates have had a quite disproportionate impact on our profitability since 1977 and, although the rate burden is still higher than elsewhere in the United Kingdom, he can at least consider further investment in Leith."
The hon. Gentleman talks often about the problems of unemployment in his area. I am sure that they are great. I am also sure that he would welcome any move that is likely to produce more jobs in his constituency. In this case, such a move is a reduction in the rates.
Mr. Ron Brown: Is the Minister aware that rates have increased and services have been cut because the Government have cut rate support grant? They have done that repeatedly. The press does not mention it because it is the Government's press, but that is the truth.
Mr. Ancram: The hon. Gentleman is making the same point that the right hon. Member for Glasgow, Govan (Mr. Millan) made earlier—if the Government maintained rate support grant at a given level rates would nave been reduced. It does not follow naturally that that would happen. However, if, after reductions in rate support grant, councils had reduced expenditure as they were asked to do by the Government and as the Government had a right to ask them to do, there would have been no rate increases. The hon. Gentleman's argument is invalid to that extent.
The hon. Members for Glasgow, Garscadden (Mr. Dewar) and for Livingston (Mr. Cook) made several important points. Both mentioned the guidelines. As I said at the end of the previous debate, we had a system of guidelines that was based largely on historic expenditure. It tended to favour councils with a higher level of expenditure, to the detriment of councils that handled their expenditure more carefully. The guidelines were rough and ready in the sense that the hon. Member for Livingston understands. At the moment, the guidelines are being based on an assessment of the needs in each area. The Scottish Office is not alone in making that assessment—local authorities are co-operating. I hope that the hon. Member for Livingston will bear that in mind when he criticises the guidelines. After all, they were introduced by the Labour Government. They were rough and ready then and remained so in the early years of the previous Government. They are now improving and we are continuing to improve them. I am grateful for the cooperation that we have received from COSLA.
Mr. Robin Cook: Will the Minister now reply to the point that I made in my speech? If the guidelines for the supposedly comparable authorities are diverging so markedly from the guideline for Lothian—by a factor of 17 per cent. in the past two years—would he care to explain how those authorities are comparable with Lothian although they require different guideline treatment?
Mr. Ancram: The hon. Gentleman knows that the comparisons are based on several criteria, only one of which is spending in excess of the guidelines. If he is prepared to accept that the guidelines are becoming more accurate assessments of the needs and expenditure requirements of the various authorities—no one claims that they are perfect—what has happened in the past

645
few years might reflect what many of us have suspected for a long time, that expenditure in Lothian has been far too high. What is now happening in Lothian is a reflection of high spending policies in the past.
Mr. William McKelvey: When the guidelines are drawn up, how much thought is given to what happens when there is a cut in services such as has been mentioned? How much thought goes into the human misery that cuts in services create? Is that misery conveniently forgotten just as the Minister has forgotten about it today?
Mr. Ancram: An important feature of the way in which the guidelines are worked out is that there is a possibility of examining changes. One has to build in a factor to ensure that the change in the guidelises in not excessive, as that would cause disruption in a local authority's spending plans. The various client groups are examined and it is possible to make an assessment when circumstances have changed. To that extent it is a fairer system and it should be welcomed. I appreciate, however, that some hon. Members believe that they are being especially hard done by and prefer the old rough and ready method which was less general.
The hon. Member for Garscadden mentioned several criteria, but he has not understood that the assessment made by my right hon. Friend in deciding whether to take selective action is based not on one criterion but on a combination of criteria. It is a balance between several criteria, which gives him the ability to decide whether a local authority's expenditure is excessive and unreasonable. It is not for him or for me to take one criterion and to say that the case has been proved on the basis of that alone. That was the basis of the hon. Gentleman's argument, which does not hold water.
Several hon. Members have mentioned expenditure per head of the population. In an interesting and useful speech—
Mr. Tam Dalyell: I accept that there is a problem in referring to individual services, but my hon. Friend the Member for Livingston (Mr. Cook) mentioned the urgent problem of remedial teachers, which is a policy matter for the Scottish Education Department. Does the Minister have any comment on that central Government responsibility?
Mr. Ancram: The hon. Gentleman must realise that I do not have responsibility for such matters. He can write to my hon. Friend the Under-Secretary of State who is responsible for education, who will answer his question about Government policy. My hon. Friend is sitting here, and I am sure that he heard what the hon. Gentleman said.
My hon. Friend the Member for Edinburgh, West (Lord James Douglas-Hamilton), in an interesting and useful speech, gave the House the facts about per capita expenditure. However, the hon. Member for Livingston was correct to say that expenditure per head in Lothian region is not the highest in Scotland. Two other regions spend more, but the hon. Gentleman will accept that they do so for special reasons, several of which he underlined during his speech. Per capita expenditure in Lothian region at £439·14 is above the average for all regions—
Mr. Robin Cook: By 3 per cent.
Mr. Ancram: —which is £424·03, and it is above the average for comparable authorities, which is £403·24.
The case that we are putting before the House is based on the three criteria stated by my right hon. Friend, which I shall repeat now. The guideline excess of 13 per cent. is the highest of any region and is well above the average for other Scottish regions, which stands at roughly half that level. Expenditure per head is higher than in any other region, except the two that have special circumstances, and despite the fact that last year my right hon. Friend, in giving Lothian time to make the adjustments needed, made it clear that further savings in expenditure should be made this year, there has been no expenditure reduction since 1982–83. On that basis, Lothian's expenditure in the current year is unreasonable and excessive. I ask the House to approve the order.
Question put:—
The House divided: Ayes 208, Noes 144.

Division No. 39]

[9.19 pm

AYES

Amess, David

Hayward, Robert

Ancram, Michael

Heathcoat-Amory, David

Atkins, Rt Hon H. (S'thorne)

Heddle, John

Boscawen, Hon Robert

Henderson, Barry

Brandon-Bravo, Martin

Hickmet, Richard

Bright, Graham

Hicks, Robert

Brooke, Hon Peter

Higgins, Rt Hon Terence L.

Bruinvels, Peter

Hirst, Michael

Bulmer, Esmond

Holland, Sir Philip (Gedling)

Chapman, Sydney

Holt, Richard

Clegg, Sir Walter

Hordern, Peter

Colvin, Michael

Howard, Michael

Cope, John

Howarth, Gerald (Cannock)

Corrie, John

Hubbard-Miles, Peter

Crouch, David

Hunt, John (Ravensbourne)

Currie, Mrs Edwina

Hunter, Andrew

Dorrell, Stephen

Jackson, Robert

Douglas-Hamilton, Lord J.

Jessel, Toby

Dover, Denshore

Jones, Gwilym (Cardiff N)

Dunn, Robert

Jones, Robert (W Herts)

Eggar, Tim

Kellett-Bowman, Mrs Elaine

Evennett, David

Key, Robert

Eyre, Reginald

King, Roger (B'ham N'field)

Fallon, Michael

King, Rt Hon Tom

Farr, John

Knight, Gregory (Derby N)

Favell, Anthony

Knowles, Michael

Fenner, Mrs Peggy

Lang, Ian

Fletcher, Alexander

Lawler, Geoffrey

Fookes, Miss Janet

Lawson, Rt Hon Nigel

Forsyth, Michael (Stirling)

Lee, John (Pendle)

Forth, Eric

Lester, Jim

Freeman, Roger

Lewis, Sir Kenneth (Stamf'd)

Gale, Roger

Lightbown, David

Galley, Roy

Lilley, Peter

Gardiner, George (Reigate)

Lloyd, Peter, (Fareham)

Gardner, Sir Edward (Fylde)

Lord, Michael

Garel-Jones, Tristan

Lyell, Nicholas

Goodlad, Alastair

McCrindle, Robert

Gorst, John

McCurley, Mrs Anna

Gower, Sir Raymond

MacKay, Andrew (Berkshire)

Grant, Sir Anthony

MacKay, John (Argyll & Bute)

Gregory, Conal

Macmillan, Rt Hon M.

Griffiths, Peter (Portsm'th N)

McNair-Wilson, M. (N'bury)

Ground, Patrick

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

Gummer, John Selwyn

McQuarrie, Albert

Hamilton, Hon A. (Epsom)

Malins, Humfrey

Hamilton, Neil (Tatton)

Malone, Gerald

Hampson, Dr Keith

Maples, John

Hanley, Jeremy

Marland, Paul

Hargreaves, Kenneth

Marshall, Michael (Arundel)

Harvey, Robert

Maude, Francis

Haselhurst, Alan

Maxwell-Hyslop, Robin

Hawkins, C. (High Peak)

Mayhew, Sir Patrick

Hawkins, Sir Paul (SW N'folk)

Mellor, David

Hawksley, Warren

Merchant, Piers

647

Meyer, Sir Anthony

Spence, John

Miller, Hal (B'grove)

Spencer, D.

Mills, Iain (Meriden)

Spicer, Jim (W Dorset)

Mills, Sir Peter (West Devon)

Spicer, Michael (S Worcs)

Miscampbell, Norman

Squire, Robin

Mitchell, David (NW Hants)

Stanbrook, Ivor

Moate, Roger

Stanley, John

Monro, Sir Hector

Stern, Michael

Montgomery, Fergus

Stevens, Lewis (Nuneaton)

Morris, M. (N'hampton, S)

Stevens, Martin (Fulham)

Morrison, Hon P. (Chester)

Stewart, Allan (Eastwood)

Moynihan, Hon C.

Stewart, Andrew (Sherwood)

Murphy, Christopher

Stradling Thomas, J.

Neale, Gerrard

Sumberg, David

Needham, Richard

Taylor, John (Solihull)

Nelson, Anthony

Tebbit, Rt Hon Norman

Neubert, Michael

Temple-Morris, Peter

Newton, Tony

Terlezki, Stefan

Norris, Steven

Thomas, Rt Hon Peter

Ottaway, Richard

Thompson, Donald (Calder V)

Page, Richard (Herts SW)

Thompson, Patrick (N'ich N)

Parris, Matthew

Thorne, Neil (Ilford S)

Patten, Christopher (Bath)

Thornton, Malcolm

Patten, John (Oxford)

Tracey, Richard

Pawsey, James

Trippier, David

Peacock, Mrs Elizabeth

Trotter, Neville

Pink, R. Bonner

Twinn, Dr Ian

Pollock, Alexander

van Straubenzee, Sir W.

Powell, William (Corby)

Vaughan, Dr Gerard

Prentice, Rt Hon Reg

Viggers, Peter

Price, Sir David

Wakeham, Rt Hon John

Raffan, Keith

Waldegrave, Hon William

Rathbone, Tim

Walden, George

Rees, Rt Hon Peter (Dover)

Walker, Bill (T'side N)

Renton, Tim

Waller, Gary

Rhys Williams, Sir Brandon

Wardle, C. (Bexhill)

Robinson, Mark (N'port W)

Warren, Kenneth

Roe, Mrs Marion

Watts, John

Rumbold, Mrs Angela

Wells, Bowen (Hertford)

Ryder, Richard

Wells, John (Maidstone)

Sainsbury, Hon Timothy

Wheeler, John

Sayeed, Jonathan

Whitfield, John

Shaw, Sir Michael (Scarb')

Wilkinson, John

Shelton, William (Streatham)

Wolfson, Mark

Shepherd, Colin (Hereford)

Wood, Timothy

Shepherd, Richard (Aldridge)

Yeo, Tim

Shersby, Michael

Younger, Rt Hon George

Sims, Roger

Smith, Sir Dudley (Warwick)

Tellers for the Ayes:

Smith, Tim (Beaconsfield)

Mr. John Major and

Soames, Hon Nicholas

Mr. Douglas Hogg.

NOES

Adams, Allen (Paisley N)

Boyes, Roland

Archer, Rt Hon Peter

Bray, Dr Jeremy

Ashley, Rt Hon Jack

Brown, Gordon (D'f'mline E)

Ashton, Joe

Brown, Hugh D. (Provan)

Atkinson, N. (Tottenham)

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

Bagier, Gordon A. T.

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

Barnett, Guy

Brown, Ron (E'burgh, Leith)

Barron, Kevin

Bruce, Malcolm

Beckett, Mrs Margaret

Caborn, Richard

Bell, Stuart

Campbell, Ian

Bermingham, Gerald

Canavan, Dennis

Bidwell, Sydney

Clarke, Thomas

Blair, Anthony

Cohen, Harry

Boothroyd, Miss Betty

Coleman, Donald

648

Cook, Frank (Stockton North)

McTaggart, Robert

Cook, Robin F. (Livingston)

McWilliam, John

Corbett, Robin

Madden, Max

Cowans, Harry

Marek, Dr John

Craigen, J. M.

Marshall, David (Shettleston)

Crowther, Stan

Martin, Michael

Cunliffe, Lawrence

Maxton, John

Dalyell, Tam

Meacher, Michael

Davies, Ronald (Caerphilly)

Meadowcroft, Michael

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

Michie, William

Deakins, Eric

Mikardo, Ian

Dewar, Donald

Millan, Rt Hon Bruce

Dixon, Donald

Miller, Dr M. S. (E Kilbride)

Dormand, Jack

Morris, Rt Hon A. (W'shawe)

Dubs, Alfred

Morris, Rt Hon J. (Aberavon)

Duffy, A. E. P.

Nellist, David

Dunwoody, Hon Mrs G.

Oakes, Rt Hon Gordon

Eadie, Alex

O'Neill, Martin

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

Park, George

Evans, Ioan (Cynon Valley)

Patchett, Terry

Evans, John (St. Helens N)

Pavitt, Laurie

Ewing, Harry

Pendry, Tom

Fatchett, Derek

Pike, Peter

Field, Frank (Birkenhead)

Powell, Raymond (Ogmore)

Fisher, Mark

Radice, Giles

Flannery, Martin

Randall, Stuart

Forrester, John

Redmond, M.

Foster, Derek

Rees, Rt Hon M. (Leeds S)

Foulkes, George

Richardson, Ms Jo

Freeson, Rt Hon Reginald

Roberts, Allan (Bootle)

Garrett, W. E.

Roberts, Ernest (Hackney N)

Gilbert, Rt Hon Dr John

Robertson, George

Godman, Dr Norman

Ross, Ernest (Dundee W)

Golding, John

Sedgemore, Brian

Hamilton, James (M'well N)

Sheerman, Barry

Hamilton, W. W. (Central Fife)

Sheldon, Rt Hon R

Hardy, Peter

Short, Ms Clare (Ladywood)

Harman, Ms Harriet

Silkin, Rt Hon J.

Harrison, Rt Hon Walter

Skinner, Dennis

Heffer, Eric S.

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

Holland, Stuart (Vauxhall)

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

Home Robertson, John

Soley, Clive

Hoyle, Douglas

Stott, Roger

Hughes, Robert (Aberdeen N)

Strang, Gavin

Hughes, Sean (Knowsley S)

Straw, Jack

John, Brynmor

Thompson, J. (Wansbeck)

Kaufman, Rt Hon Gerald

Tinn, James

Kennedy, Charles

Varley, Rt Hon Eric G.

Kirkwood, Archibald

Wardell, Gareth (Gower)

Lambie, David

Wareing, Robert

Lamond, James

Welsh, Michael

Leadbitter, Ted

Williams, Rt Hon A.

Lewis, Terence (Worsley)

Wilson, Gordon

Litherland, Robert

Winnick, David

Lloyd, Tony (Stratford)

Woodall, Alec

McCartney, Hugh

Young, David (Bolton SE)

McDonald, Dr Oonagh

McGuire, Michael

Tellers for the Noes:

McKelvey, William

Mr. Frank Haynes and

Mackenzie, Rt Hon Gregor

Mr. Norman Hogg.

Question accordingly agreed to.
Resolved,
That the Rate Reduction (Lothian Region) 1983–84 Report, which was laid before this House on 7th July, be approved.

Rates (Stirling District)
9.30 pm
The Under-Secretary of State for Scotland (Mr. Michael Ancram): I beg to move,
That the Rate Reduction (Stirling District) 1983–84 Report, which was laid before this House on 7th July, be approved.
Like Lothian, Stirling district has been the subject of selective action in the two years previous to this. In 1981 Stirling preferred to lose grant rather than return savings to the ratepayers. In 1982 common sense prevailed and, following the approval of a report by the House, the council reduced its rate by 4p. That rate reduction was the equivalent to a smaller expenditure reduction of £832,000 than that originally proposed by my right hon. Friend the Secretary of State and approved by the House — a reduction of £1·2 million.
In accepting the proposed rate reduction my right hon. Friend made it clear that he regarded the savings to be made by it as only a first step in reducing the council's expenditure to a level which he could accept as satisfactory. He also made it clear that he expected the council to consider urgently further reductions in expenditure in 1983–84. It is a matter for regret that my right hon. Friend's act of understanding on that occasion has not been repaid in a substantial expenditure reduction this year.
However, for 1983–84 Stirling's guideline excess was, at 29·5 per cent., well above the average and its expenditure per head at £68·89 was above that of comparable authorities. [Interruption.] Its reduction in expenditure from 1982–83 appears to my right hon. Friend to be insufficient to bring its expenditure down to a reasonable level. The reduction from last year's outturn was less than 1 per cent.
As with other authorities against which my right hon. Friend initiated selective action, he gave careful consideration to the council's representations and limited the original rate reduction that he proposed from 3p to 2p. The council had the opportunity to make that reduction voluntarily and I understand that its policy and resources committee was prepared to recommend a reduction in the rate, although not of the level that my right hon. Friend had proposed.
It is a pity for the ratepayers of Stirling that, having accepted that rates should come down, the council, like Kirkcaldy, put the political gesture before its ratepayers' interests. That left my right Friend with no choice but to lay a report as the means of returning the justifiable savings to the ratepayers of Stirling and it is that for which I seek the support of the House tonight.
9.33 pm
Mr. Martin J. O'Neill: This is a ritual which the Minister has already outlined in the debates that we have had in the House over the past few years about Stirling. It is part of a debate which many of us have had to put up with over the past three years when we were seeing the powers of local authorities in Scotland being continually eroded. However, in days gone by we have had the services of the hon. Member for Edinburgh, Pentlands (Mr. Rifkind), who used to argue the case on behalf of the Government and when there was a possibility of some kind of serious debate on the matter.
We have had this evening an understandably short but wholly unjustified attack on Stirling. The substance of the
650
Government's case against Stirling has not been argued. The local authority is being denied the right to provide the services that the electorate want. The Government are required to prove their case against Stirling, and we want that done tonight. It has not been done and the onus still rests on the Government to justify the imposition they are making on a democratically elected authority.
Over the years Stirling has become aware of the need to improve services. The services were so inadequate in the late 1970s that even the Right-wing majority on the council realised that something had to be done. In 1978–79 it underspent by 3·6 per cent. Today, it is 29·5 per cent. in excess of the guidelines.
It would be wrong to suggest that Stirling is the only district in that position. Some 13 districts are spending in excess of 25 per cent. above the guidelines. Only Glasgow of the other top five high-spending authorities is also on the hit list. Aberdeen, Ettrick and Lauderdale, Dunfermline and Cumnock and Doon all spent more than Stirling. As the guidelines have been undermined, perhaps we can say that they do not matter. It could be argued that, if we took account of the Government's cuts in expenditure, we would be discussing an even lower figure tonight.
Stirling cannot easily be compared with other authorities. Few others have the urban nucleus together with the large rural hinterland of Stirling. The adjustment from the rate support grant to the client group method has brought about even more abuses of the already irrational basis of comparison.
The Secretary of State has undergone a number of changes of mind. Since 1981–82 he has tried to compare Stirling with 10 other authorities. He used four authorities in the first year and scrapped three of those the following year. A year later he used another four. No reason has been given for those changes. There was no discussion with Stirling about the basis upon which it was being compared with other authorities. The comparable authorities which spent more than Stirling were not on the hit list.
In 1983–84, all comparators were planning an increase in excess of Stirling for expenditure, rates and the average domestic rate bill, yet in all those instances Stirling is making a reduction. Cunninghams and Kyle and Carrick have either spent or are planning to spend more than Stirling during the period 1978–79 to 1983–84. Cunninghams has had higher rate increases than Stirling since 1978–79.
It is not as though the services provided by Stirling are in excess of other Scottish authorities. It is the fifth highest spender in cleansing the tenth in planning, the third in libraries and museums, the sixteenth in leisure and recreation, the first in environmental health, the nineteenth in burial grounds and, perhaps most important of all, the thirty-ninth in administration.
No one is trying to suggest that Stirling is a low-spending authority. Those days have gone. At the last district elections the electorate voted for better services, and that is what they are getting. They are also getting a far better adminstration and far better value for money. This authority is a credit to Scottish local government. It is providing at a relatively low cost better services than many other authorities and is doing so in a way that will enable it to have a reasonble level of spending.
On any basis of comparison, six districts will be spending more; five districts will have a bigger excess over guidelines; five districts will have higher rates; and

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five districts will have a higher domestic rate bill. In all, that accounts for 10 different authorities, only one of which is on the hit list. The desirability of these services is now accepted within Stirling. We have heard much this evening of the cross-party agreement in Lothian. The Conservative produced their budget at the finance meeting in Sterling. The budget was for 28 per cent. over the guidelines. The Labour majority had a bigger figure of 29·5 per cent. It would appear that everyone except the Secretary of State is out of step in Scotland.
We were told before the legislation was passed that the aim was to cut public expenditure. The contribution of this order to cutting the overspend of local authorities throughout the United Kingdom is 0·02 per cent. of the United Kingdom total. If the report is agreed this evening, the overspend of British local authorities will still be 99·98 per cent. of the total.
What will be the result of this cut? We will see once again an abuse of local democracy. In Stirling, there is a wide measure of consensus between the Conservative and Labour groups on the quality of services, but those views will be cast aside. It will happen in a way that will do Scotland, and the office of the Secretary of State, no credit.
We were told earlier this evening that Stirling district council was putting political gestures before the ratepayers. In the short time available to me I have tried to make it clear that Stirling recognises that its citizens are entitled to decent services, that the community as a whole wants decent services and that the only people who are stopping them from getting those services in a responsible and efficient manner are the Secretary of State and his running boy. "Chairman Earl", across the way.
We wish to make it clear that we shall divide the House on the report. We shall be opposing the Government's political gesture by taking the only action that is available to us and we shall be expressing our support and confidence for a good authority that is seeking to protect its people.
9.42 pm
Mr. Michael Forsyth: I am glad that the hon. Member for Clackmannan (Mr. O'Neill) raised the issue of mandate and what the electorate voted for in Stirling. The electorate in Stirling had an opportunity to vote in the not too distant past and long after the district council elections to which he refers. The electorate of Stirling voted overwhelmingly for a Conservative Member of Parliament and it rejected the extravagant policies on which that district council had embarked. Even if the electorate in that constituency, who are included in the hon. Gentleman's constituency, had voted for the extravagant policies which the leader of the council, the Labour candidate, advocated, he would still have suffered defeat at the polls. There is no local mandate in Stirling for this extravagance. No election address promising catastrophic rate increases of 122 per cent. was delivered during those council elections.
My experience during the election campaign was one with which hon. Members south of the border may be not familiar. Callendar is not a big place and it is possible to drive along the high street and miss most of the shops, but six of them closed last year.
Mr. Dennis Canavan: That is the fault of the Tory Government.
Mr. Forsyth: Six shops in one street in one tiny village closed because they could not pay their rates — rates levied by the Stirling district council. The Opposition play down the effects of high rating and make out that central Government are to blame. Tell that to my constituents who are involved in the tourist trade, who must compete with neighbouring Perth and Kinross, where the rate is 18½p in the pound compared with Stirling's 40p. The hoteliers must meet that cost. It means less business and fewer jobs, about which the hon. Member for Falkirk, West (Mr. Canavan) always tells us of his concern.
Nobody in Stirling I have come across, not even the leader of the district council, would argue that the standard of service in Stirling district is twice as good as that in Perth and Kinross, but the bill is more than twice as much.
The difference between us is one of ideology. That ideology would have that council continue with its irresponsible spending, and the Government are right to stop that kind of behaviour. Local government in Scotland under Socialist control is helping to cripple the progress we are making with the economy in Scotland. It employs 20 per cent. more staff per head than the rest of the United Kingdom. We must never forget, for all the talk of democracy, that those who foot the bill—most of them in industry, commerce and trade — have no vote in district council elections. But they had a vote, which was clear, when they decided to close their businesses and leave the constituency.
Stirling district council has shown, by its history, its attitude to selective action. In 1980–81 the Secretary of State proposed a reduction of 6p in the rates. The same arguments came up — indeed, the hon. Member for Falkirk, West was there arguing the same case—about services being destroyed and the most appalling devastation being brought to the constituency. My right hon. Friend gave way and lowered the reduction from 6p to 4p.
The doom and gloom about which we were told was not forthcoming. At the end of that financial year, Stirling district found itself with the embarrassment of an enormous surfeit of money, about 2p of rate which the Secretary of State, out of his concern, had allowed the council to keep. What did those concerned on the council do with it? They rushed out and bought themselves a football ground and paid off the football club's overdraft.
Mr. O'Neill: The hon. Gentleman is talking about the purchase of Anfield. I suggest that he waits to see what happens there because it is clear from the interest that is being shown in that site that it is likely that the town will obtain a valuable asset of tremendous use to the ratepayers far beyond the simple confines of a football stadium.
Mr. Forsyth: I have no desire to debate the merits of local authorities being in the football business. I am simply pointing out the threats which we heard from the district council and Labour Members about the social services and so on suffering. That did not occur because they were left with money to do various other things. What are they doing in this financial year? They are talking about giving £50,000 to a company in the form of a loan to develop a bowling club.
Local democracy in Stirling is the sort of local democracy which has not even given the Conservative members on that council—nine compared with Labour's 10 — the opportunity to discuss the response to the

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Secretary of State's initiative. Their local democracy is the sort of democracy which keeps the elected Conservative members out of discussing policy but illegally invites trade union representatives into the workings of the council to discuss, according to their vested interests, how ratepayers' money should be spent and not saved.
I had the pleasure of reading in some detail and responding to the Stirling district's submission to my right hon. Friend the Secretary of State. The argument about democracy can be summed up in this way. The most democratic way to deal with other people's money is to leave it in their pockets and allow them to spend it themselves. Stirling district council has increased its manpower by about 18 per cent. since 1980 to a projected 1,010 in 1983–84. That means a 43 per cent. increase in leisure and recreation staff and a 27 per cent. increase in its inefficient direct labour organisation which is involved in housing repairs. Last year alone the numbers employed by that authority increased by 4 per cent. The rate increase of 1981–82 of 122 per cent. brought greater hardship throughout the constituency. Had my right hon. Friend not intervened, instead of paying a 40p rate we would have been paying a 46p rate. Expenditure is about £68·89 a head compared with the average of £58·68.
In its submission the district council says that it does not like guidelines. No spendthrift likes his overdraft limit or his bank manager. The council argues that statistical methods of establishing need should not be considered. However, it has never argued against the rate of support grant, which is determined on the same overall basis. The council claimed credit for achieving a real reduction in expenditure. It has achieved that, but, my goodness, expenditure started at a high level and the fact that the authorities could do that shows that they raised rates and destroyed jobs needlessly. That is the same catalogue of scare stories designed to frighten the public. Stirling district council argues that cuts in services must be the inevitable consequence of expenditure costs and that a loss of jobs will result.
Stirling district council and its executives are planning a reorganisation to bring about efficiency. This means bringing in more chiefs at high salaries to police ever-increasing numbers of Indians. They have ignored the pleas, not just from the Conservatives but from the ratepayers' association and others, to invite tenders for services and to introduce volunteers, despite claims of savings of more than 2p on rates. They blame the Government for adding to their obligations, burdens and expenses. It is true that some measures add to their obligations, but others, such as council house sales, produce savings year in, year out on the housing revenue account. However, Stirling district council has dragged its feet on that issue to an obscene degree, resulting in delays. The average time taken to buy a council house in the Stirling district was 22 months. Some people had to wait more than three years. Not only is that financially irresponsible, but it is irresponsible treatment of council tenants.
Government economic policy must take precedence over the dreams and profligate plans of local politicians. Stirling district council is extravagant and irresponsible, and it has acted without any mandate or support from the constituency. Its performance was overwhelmingly rejected by the electorate in the general election.
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I welcome the measures proposed by the Secretary of State. They offer protection for my constituents, including the elderly who receive four-figure rate bills that they cannot pay. I welcome the 2p rate reduction. However, I regret that the Minister has been almost too reasonable in letting the council have that reduction; he should have gone for the full 3p. The council should count itself lucky that the Minister has again placed his trust in it.
I hope that the money that is left to the council will be used more responsibly than in the past. This report will be widely welcomed in Stirling. It will provide a greater boost to jobs and businesses than any other Government action.
9.54 pm
Mr. Dennis Canavan: I am grateful to you, Mr. Deputy Speaker, for allowing me to catch your eye. Although I no longer have a direct constituency interest in Stirling district and its affairs, nevertheless, I suppose that I should, like the Secretary of State, declare my interest. I am a ratepayer and, like the Secretary of State, if the order is passed, we will perhaps receive some money in our pockets from a rate rebate. However, I differ from the Secretary of State; because I want better services not just for myself and my family but for the community.
The Secretary of State, like the hon. Member for Stirling (Mr. Forsyth)—it sticks in my craw to call him the hon. Member for Stirling because if it had not been for the gerrymandering of Tory Sheriff Taylor, the hon. Member would not be here tonight. He is not the Member for Stirling district. He may be the Member for the cooked-up gerrymandering constituency invented by Sheriff Taylor—
Mr. Michael Forsyth rose—
Mr. John Maxton: Sit down.
Mr. Forsyth: I should like to make it clear that if one took that part of Stirling district which is not in my constituency and assumed that every elector would have voted for my Labour opponent, I should still have been elected. I have a mandate to represent Stirling district.
Mr. Canavan: That is pure hypothesis. The hon. Gentleman knows that the only reason why Fallin, Plean, Cowie and Throsk were transported across the water was to make it easier for him or some other Tory placeman to come in to this place and misrepresent the interests of the people of Stirling district.
The hon. Gentleman does not represent the interests of the people of Stirling district. He represents the gerrymandering Tory part of Stirling district invented by Sheriff Taylor in which the Secretary of State lives. The Secretary of State stands to receive a rebate if the order is approved tonight.
Almost 10 years ago, before I came here, I was the first leader of the Labour group on Stirling district council. We were then a minority. I always stated that we would control Stirling district one day. I believed—the majority of working class people within Stirling district eventually realised that I was right—that the only way in which we could improve local government services, whether at regional or district level — education, social work, environmental health, leisure, recreation and so on—was by returning a Labour-controlled district council in Stirling.

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I am pleased to report that in 1980 we almost achieved that. We had parity. We had 10 out of the 20 seats. There was one enlightened independent member from a rural area who decided that a socialist administration would be in the interests of the people that he represented as well as those of Stirling district in general. We had a working majority with the casting vote of my good friend, convener councillor Edward Monahan. Since then there have been many progressive changes in that part of Stirling district which used to be in Perth county and which was inherited from the previous Tory Administration represented by the hon. and learned Member for Perth and Kinross (Mr. Fairbairn) the former Solicitor-General, who was deservedly sacked. People in Aberfoyle, Doune and Dunblane, and in much of the rural area that falls within Stirling district now admit that the services provided for them, whether in libraries, bucket collecting or whatever, are far superior to the parsimonious attitude which has been adopted for many years by—
It being Ten o'clock the debate stood adjourned.

BUSINESS OF THE HOUSE
Ordered,
That, at this day's sitting, the Medical Bill [Lords], the Car Tax Bill [Lords], and the Value Added Tax Bill [Lords] may be proceeded with, though opposed, until any hour. — [Mr. Archie Hamilton.]

Rates (Stirling District)
Question again proposed.
Mr. Canavan: I thought, Mr. Speaker, that you were going to follow the will of your predecessor in calling me to order, but I now realise that it was just the Ten o'clock motion.
Since Labour got effective control of Stirling district council in 1980, a campaign of continued victimisation — indeed, a vendetta — has been conducted by the Secretary of State for Scotland who, I repeat, has a vested interest, and whose lug is very open to the blandishments of the local Tory establishment when it says to him, "Why do you not get a grip of this Left-wing element who are supposed to be in control of Stirling district council?" We have seen that taking place, even to the extent of gerrymandering of the constituency boundary so as to bring the hon. Member here. The councillors of Stirling district, some of whom have travelled the many hundreds of miles her tonight to listen to this debate, and who will go back again to represent their people, have a much better mandate than the Secretary of State for Scotland has to represent the people. It is about time that the Secretary of State realised that.
I put a question to the Secretary of State: why is there this victimisation? When the Government were elected in 1979 they claimed that they would reduce public expenditure. That was their great aim, and that is what all this is supposed to be about, according to the Secretary of State. He says "We need to reduce public expenditure, and therefore we have to hammer the likes of Stirling district council."
Since 1980, shortly after the Secretary of State was returned as Secretary of State—appointed as Secretary of State, rather, because he was never returned, certainly not by the people of Scotland—since the time when he became the Prime Minister's placeman to look after Scotland, supposedly, we have had a 12 per cent. increase
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in central Government expenditure, and a 3 per cent. decrease in local government expenditure. In other words, local government is doing its best, rightly or wrongly, to meet expenditure targets, and it is meeting those targets far more successfully than central Government. Part of the reason for that, of course, is the massive increase in unemployment, in that it means an increase in public expenditure, and the massive increase in defence expenditure, such as the £10,000 million-plus which the Government plan to spend on Trident and which they are attempting to foist on the people of Scotland, despite the fact that the vast majority of those people want nothing to do with it. Those are the priorities of public expenditure. [Interruption.] What is the hon. Member for Crawley (Mr. Soames) laughing at? Does he not realise that the majority of people in Scotland want nothing to do with Trident? I have never seen him here before, but I put to him a question: can he point to any person ill Scotland, apart from these balloons on the Front Bench, who are supposed to be representing but in fact are misrepresenting the people of Scotland, who would rather £10,000 million be spent on Trident than on the National Health Service or local government services—housing, health, education, services for the elderly, sick, disabled and children? Local priorities for expenditure and the principle of local democracy are at stake. This Government pay lip-service to local democracy.
At the election the Government were rejected by over 70 per cent. of the people of Scotland. They received no mandate to impose their iniquitous policies on the Scottish people. A Scottish Assembly is the only way in which local government can be dealt with in Scotland, but some hon. Members will disagree with me about that. The Government are imposing over-centralisation so that the people of Stirling, Lothian, Glasgow and Kirkcaldy are victims of an over-centralised decision-making process at Westminster. English Tory Members, who have never even listened to my sweet words or those of any other Scottish Labour Member, are being dragooned into the Lobbies to follow like sheep the Prime Minister and the Tory Secretary of State for Scotland without knowing the need or the priorities of the Scottish people. Tory Members will determine the level of services in Scotland.
Local authorities were elected in Scotland with a better mandate than the Tory Members representing English constituencies, the Tory Secretary of State who represents only a tiny minority of the Scottish people, or the hon. Member for Stirling, who represents only a tiny minority of people in the Stirling district.
Mr. Michael Forsyth rose—
Mr. Canavan: I shall give way, since the hon. Member for Stirling represents at least part of the gerrymandered constituency.
Mr. Forsyth: I do not know that there is a great difference between the leader of the council and the Secretary of State. Is the hon. Gentleman aware that the leader of the district council, with his mandate, was quoted, prior to the general election, in the Stirling Observer as saying that if the Tories promised to cut the rates by 3p then he would cut the rates by 3p and steal their thunder. The Secretary of State is giving him a chance to honour that promise.
Mr. Canavan: I am sure that the leader of the Labour group on Stirling district council is capable of defending

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himself. If Fallin, Plean, Cowie and Throsk had been in the Stirling constituency instead of being gerrymandered across the water by Sheriff Taylor, a Tory placeman, the hon. Member for Stirling would not be here to speak on behalf of the Tories in Stirling. We are in a ridiculous situation because the heir to the Marquess of Lothian is dictating, not just to the people of Lothian, but to the people of Bannockburn and to the other people of Stirling district. The Secretary of State laughs, because he and his family are quite well off. His family is aristocratic, like the Marquess of Lothian's family. It is ridiculous that Scotland should be ruled by a load of blue-blooded aristocrats who have no contact whatever with working-class people. Conservative Members laugh, but it is true. The son of the Viscount is telling us that we should vote for him tonight, and the son of the Marquess is defending what the son of the Viscount proposes. What sort of democracy is that? They have sent one of their placemen sheriffs to gerrymander a constituency to ensure the return of a Tory Member of Parliament who has spent much of his time in London local government and knows nothing at all about the people of Bannockburn, Gargunnock, Cambusbarron, St. Ninians, Raploch or anywhere else for that matter. He says that he is coming down here to represent their cause. Like hell — he is coming to misrepresent it.
Mr. Barry Henderson: The hon. Gentleman has been talking about democracy and mandates, but has he noticed that there are more Scottish Conservative Members in the Chamber listening to him than Scottish Labour Members?
Mr. Canavan: I think that there is something wrong with the hon. Gentleman's arithmetic. When it comes to the vote tonight we shall see, in all probability, what has often happened before. The majority of elected representatives from Scotland will vote against the motion, just as we have done many times before in the past four or five years. When we vote against Tory legislation we are outnumbered by Tory Members from south of the border who are drafted in at the last minute, who have not listened to the debate and who are being used as Lobby fodder. That is a sheer negation of democracy.
It is bad enough that the Secretary of State has no mandate from the people of Scotland, but the Government are now using the people of Scotland as guinea pigs for their Tory, anti-Socialist legislation. They used us as guinea pigs in the criminal justice legislation, by giving increased powers to the police of search and arrest. They used us as guinea pigs on local government legislation during the previous Parliament by taking powers away from the elected representatives of the people in local government and vesting more powers in the Secretary of State here, or in St. Andrew's house. Yet he has no mandate from the people of Scotland, The motion will only increase centralisation.
I appeal to those hon. Members who represent English consituencies and to enlightened Tory Members — if there are any, and if that is not a contradiction in terms —that if they listen to reason and believe in democracy, they should not go into the Lobby to vote for the motion out of prejudice and ignorance of the needs of the people of Stirling district, Lothian region, Glasgow and Kirkcaldy district. We are far more in touch with those people's
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needs and far better able to articulate them than Tory Members. My friends in the council chambers in Stirling, Kirkcaldy, Glasgow and Edinburgh are even more capable than I am of articulating the needs of the local people, and have a far better mandate to try to bring about the necessary improvements on behalf of the people than the rest of us put together. Only with a Scottish parliament or legislative assembly shall we obtain the necessary legislative protection for our people, whether the legislation involves local government, the Health Service, or education. I appeal to all my Scottsh colleagues and colleagues from south of the border to accept the argument for Scottish devolution. If ever there were a case for it, here it is tonight. We have a Tory centralised Government who are dictating measures to the people of Scotland that are contrary to their needs and aspirations. Only by more devolution, more decentralisation and more home rule for the people of Scotland shall we see an improvement of our democratic processes. If we do not see that progress in the near future, we shall see an increased discrediting of whatever credibility is still left in this so-called mother of Parliaments.
10.15 pm
Mr. Bill Walker: I believe in this unitary Parliament. I have sat through three full days of debate in this Chamber attempting to participate in the debates. I have been attempting to do what the electorate in my constituency sent me here to do, to express their voice and their views. The usual channels have been putting pressure on me not to speak this evening, but I believe that principle is important. It is important when a Back-Bench Member sits through three full days of debate waiting for an opportunity to speak. It would be quite wrong to give up merely because the usual channels suggested that one should.
Mr. George Foulkes: Get on with it.
Mr. Walker: The problems that brought these measures before us owe their origins to the black day when the right hon. Member for Leeds, East (Mr. Healey) had to go to the IMF, and when the then Secretary of State for Scotland was forced to introduce massive real cuts in local government expenditure. Central Government support for local authorities was likewise cut savagely.
Mr. Foulkes: The hon. Gentleman thought that the IMF was a furniture store.
Mr. Walker: The effect of that has been felt substantially throughout Scotland. The Labour Government of the day were fortunate in that the non-Socialist local authorities, which were the principal authorities at that time, continued the convention of spending only within the limits that central Government deemed sensible in the financial and economic circumstances of the time. Since then some Labour councils have tried to regain the losses that were incurred as a result of the cuts in spending that were imposed by their own party while in government.
The convention that then existed has been discarded deliberately and wilfully. In its place has come a ritual annual battle between Labour-controlled local authorities and central Government. If we examine closely the spending programmes of the authorities that are the subject of the motions on the Order Paper, especially Stirling, we

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see that they have recovered, relative to many other Scottish authorities, much of the ground that they lost when the IMF cuts were imposed. They have improved their position substantially relative to other authorities.
The rates imposed by the Stirling authority impose massive burdens on the employment creation areas within the district. The local authority adjacent to the Stirling authority is the one which has control within my constituency. It was referred to by the hon. Member for Falkirk, West (Mr. Canavan). There is no doubt that we can see at first hand what the differences are between the two authorities.
In an earlier debate I described the high-spending and high-rating authorities as vampires that obtain their sustenance by sucking the lifeblood of others. Every penny increase in the rates represents a massive rate burden. In the Stirling district, for example, the burden falls on the university and the health boards and runs into many hundreds of thousands of pounds. The health care funds for health boards hospitals and patients are being filched by the same councillors who will march and demonstrate when Health Service expenditure problems occur in their areas. In effect, they protest and demonstrate in some cases against the results of their own action. Is that not the world of the vampire and the madhouse? First drain the lifeblood from another public body, and then demonstrate and protest when the victim has obvious health and fitness problems.
A district increase in rates can have a savage and debilitating effect on education and social work costs—another example of one public body imposing a cost burden on another. The ones who suffer are the children in the schools and those in need of help from social work depts.
I refer to an area where the comparisons between the two authorities are clear—council house rents. Over 50 per cent. of rents of all council house tenants are paid in part or in full by Government funds. One does not have to be a mathematician to realise that, if council rents were set at an economic level, the district council would have a substantial inflow of funds from the Government because the imposed increase of rent for those already in receipt of assistance—the poorer council house tenants—would be paid in full by the Government. Therefore, if one looks carefully at the rate poundage in Stirling district and compares it with Perth and Kinross, Stirling—
Mr. Canavan: On a point of order, Mr. Deputy Speaker. Is it in order for the hon. Gentleman to read out every word of his speech, although it was prepared by civil servants in the Scottish Office?
Mr. Deputy Speaker (Mr. Harold Walker): The hon. Gentleman will know that the use of notes is permitted during debates.
Mr. Walker: As I mentioned in a Scottish Grand Committee debate, I use only my own briefs, not those of other people.
I was referring to rate poundages. For Stirling district it is 40p and for Perth and Kinross it is 14·5p. Further east in Angus, which is the other district that covers my constituency, it is 15·5p. One can see that Stirling is a high-spending local authority.
I shall cite one final example to show what I mean. Before the general election, Councillor Michael Connarty distributed leaflets at meetings in my constituency that
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were printed by the district council. I invite him to return as often as he likes to my constituency to distribute leaflets. I am sad that the authority, and therefore the ratepayers of Stirling, had to pay for them. Those leaflets helped me substantially in my battle at the general election and in no small measure contributed to the fact that over 50 per cent. of the electorate voted for me, the Conservative. It is nonsense for the hon. Member for Falkirk, West to suggest that those of us who talked about Trident and nuclear-free zones—that is what the leaflets were about—had no impact on the electorate. It had a massive impact on the electorate in my constituency of Tayside, North.
10.23 pm
Mr. Ancram: After a full debate, it is hardly for me to make detailed comments on the speeches, but I shall refer to the speech made by my hon. Friend the Member for Stirling (Mr. Forsyth) who, after all, whatever the view of the hon. Member for Falkirk, West (Mr. Canavan) on mandates, has at least been mandated directly by the people of Stirling to speak on his behalf. I hope that the House listened carefully to what my hon. Friend said. He made clear the problems that were faced by the ratepayers of Stirling.
One point that was in a sense a new one was made by the hon. Member for Clackmannan (Mr. O'Neill). He talked of the comparitors that had been used in this case and mentioned that they had been changed. It is only right that I should give him some explanation for that. They were changed in 1982–83 and are now based on a systematic method that is based on the need to spend which, as I said earlier, is the fair method of assessing. That is why the change was made.
Mr. O'Neill: Will the Minister concede that if, in the event of experience, the basis that he is choosing proves wrong—academic opinion seems to suggest it—and he changes comparitors again he he will consult local authorities to get their view on what the need to spend involves and not impose systems on local authorities as has been the case in the past?
Mr. Ancram: The hon. Gentleman will be interested to know that there has been quite an industry studying comparitors used by the Secretary of State. There has been much comment on them already today.
Stirling district complained that its expenditure per head, of £68·89, was being compared with authorities with expenditure of £63·73 per head. I am sure that the hon. Gentleman is aware that, in Stirling district's submission, it suggested other comparitor authorities but they have lower average expenditure per head at £59·92. Moreover, two of them had a different range of functions.
Had Stirling gone for the comparitor that it suggested we should have examined, the gap between its expenditure per head and the average would not have been £3·81 but £8·97. Its position would have been a lot worse than it is now. I hope that that gives the hon. Gentleman some idea that the choice of comparators is not taken lightly. It is based, as far as possible, on an assessment of need to spend in comparison with other authorities.
The Opposition's case has not in any way answered the original points that I made. On its guideline excess of 29·5 per cent., Stirling was well above the average for district councils of 21·8 per cent. Its expenditure per head was

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some £3 over the district average and, last year, despite the fact that the Secretary of State made it clear that he was giving Stirling time to adjust and expected further substantial expenditure reductions this year, the reductions that it made have been utterly insignificant. For that reason, its expenditure is excessive and unreasonable, and I ask the House to support the motion.
Question put:
The House divided: Ayes 198, Noes 138.

Division No. 40]

[10.27 pm

AYES

Amess, David

Howarth, Gerald (Cannock)

Ancram, Michael

Hubbard-Miles, Peter

Boscawen, Hon Robert

Hunt, John (Ravensbourne)

Brandon-Bravo, Martin

Hunter, Andrew

Bright, Graham

Jackson, Robert

Bruinvels, Peter

Jessel, Toby

Bulmer, Esmond

Jones, Gwilym (Cardiff N)

Chapman, Sydney

Jones, Robert (W Herts)

Clegg, Sir Walter

Key, Robert

Colvin, Michael

King, Roger (B'ham N'field)

Cope, John

King, Rt Hon Tom

Corrie, John

Knight, Gregory (Derby N)

Crouch, David

Knowles, Michael

Currie, Mrs Edwina

Lawler, Geoffrey

Dorrell, Stephen

Lawson, Rt Hon Nigel

Douglas-Hamilton, Lord J.

Lee, John (Pendle)

Dover, Denshore

Lewis, Sir Kenneth (Stamf'd)

Dunn, Robert

Lightbown, David

Eggar, Tim

Lilley, Peter

Evennett, David

Lloyd, Peter, (Fareham)

Eyre, Reginald

Lord, Michael

Fallon, Michael

Lyell, Nicholas

Farr, John

McCurley, Mrs Anna

Favell, Anthony

MacKay, Andrew (Berkshire)

Fenner, Mrs Peggy

MacKay, John (Argyll & Bute)

Fletcher, Alexander

Macmillan, Rt Hon M.

Fookes, Miss Janet

McNair-Wilson, M. (N'bury)

Forsyth, Michael (Stirling)

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

Forth, Eric

McQuarrie, Albert

Freeman, Roger

Major, John

Gale, Roger

Malins, Humfrey

Galley, Roy

Malone, Gerald

Gardiner, George (Reigate)

Maples, John

Gardner, Sir Edward (Fylde)

Marshall, Michael (Arundel)

Garel-Jones, Tristan

Maude, Francis

Goodlad, Alastair

Maxwell-Hyslop, Robin

Gorst, John

Mayhew, Sir Patrick

Gower, Sir Raymond

Mellor, David

Grant, Sir Anthony

Merchant, Piers

Gregory, Conal

Meyer, Sir Anthony

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

Miller, Hal (B'grove)

Griffiths, Peter (Portsm'th N)

Mills, Iain (Meriden)

Ground, Patrick

Mills, Sir Peter (West Devon)

Gummer, John Selwyn

Miscampbell, Norman

Hamilton, Neil (Tatton)

Mitchell, David (NW Hants)

Hanley, Jeremy

Moate, Roger

Hargreaves, Kenneth

Monro, Sir Hector

Harvey, Robert

Montgomery, Fergus

Haselhurst, Alan

Morrison, Hon P. (Chester)

Hawkins, C. (High Peak)

Moynihan, Hon C.

Hawkins, Sir Paul (SW N'folk)

Murphy, Christopher

Hawksley, Warren

Neale, Gerrard

Hayward, Robert

Needham, Richard

Heathcoat-Amory, David

Nelson, Anthony

Heddle, John

Neubert, Michael

Henderson, Barry

Norris, Steven

Hickmet, Richard

Ottaway, Richard

Hicks, Robert

Page, Richard (Herts SW)

Higgins, Rt Hon Terence L.

Patten, Christopher (Bath)

Hirst, Michael

Pawsey, James

Hogg, Hon Douglas (Gr'th'm)

Peacock, Mrs Elizabeth

Holland, Sir Philip (Gedling)

Pink, R. Bonner

Holt, Richard

Pollock, Alexander

Howard, Michael

Powell, William (Corby)

662

Powley, John

Taylor, Teddy (S'end E)

Prentice, Rt Hon Reg

Tebbit, Rt Hon Norman

Price, Sir David

Temple-Morris, Peter

Raffan, Keith

Terlezki, Stefan

Rathbone, Tim

Thomas, Rt Hon Peter

Rees, Rt Hon Peter (Dover)

Thompson, Donald (Calder V)

Renton, Tim

Thompson, Patrick (N'ich N)

Rhys Williams, Sir Brandon

Thorne, Neil (IIford S)

Robinson, Mark (N'port W)

Thornton, Malcolm

Roe, Mrs Marion

Tracey, Richard

Rumbold, Mrs Angela

Trippier, David

Ryder, Richard

Trotter, Neville

Sainsbury, Hon Timothy

Twinn, Dr Ian

Sayeed, Jonathan

van Straubenzee, Sir W.

Shaw, Sir Michael (Scarb')

Vaughan, Dr Gerard

Shelton, William (Streatham)

Viggers, Peter

Shepherd, Colin (Hereford)

Wakeham, Rt Hon John

Shepherd, Richard (Aldridge)

Waldegrave, Hon William

Sims, Roger

Walden, George

Smith, Tim (Beaconsfield)

Walker, Bill (T'side N)

Soames, Hon Nicholas

Waller, Gary

Speller, Tony

Wardle, C. (Bexhill)

Spence, John

Warren, Kenneth

Spencer, D.

Watts, John

Spicer, Jim (W Dorset)

Wells, Bowen (Hertford)

Spicer, Michael (S Worcs)

Wells, John (Maidstone)

Squire, Robin

Wheeler, John

Stanbrook, Ivor

Whitfield, John

Stanley, John

Wilkinson, John

Stern, Michael

Wolfson, Mark

Stevens, Lewis (Nuneaton)

Wood, Timothy

Stevens, Martin (Fulham)

Yeo, Tim

Stewart, Allan (Eastwood)

Younger, Rt Hon George

Stewart, Andrew (Sherwood)

Stradling Thomas, J.

Tellers for the Ayes:

Sumberg, David

Mr. Ian Lang and

Taylor, John (Solihull)

Mr. Archie Hamilton.

NOES

Adams, Allen (Paisley N)

Dixon, Donald

Archer, Rt Hon Peter

Dormand, Jack

Ashley, Rt Hon Jack

Dubs, Alfred

Ashton, Joe

Duffy, A. E. P.

Atkinson, N. (Tottenham)

Dunwoody, Hon Mrs G.

Bagier, Gordon A. T.

Eadie, Alex

Banks, Tony (Newham NW)

Evans, Ioan (Cynon Valley)

Barnett, Guy

Evans, John (St. Helens N)

Barron, Kevin

Ewing, Harry

Beckett, Mrs Margaret

Fatchett, Derek

Bell, Stuart

Field, Frank (Birkenhead)

Bermingham, Gerald

Fisher, Mark

Bidwell, Sydney

Flannery, Martin

Boothroyd, Miss Betty

Foster, Derek

Boyes, Roland

Foulkes, George

Bray, Dr Jeremy

Fraser, J. (Norwood)

Brown, Gordon (D'f'mline E)

Freeson, Rt Hon Reginald

Brown, Hugh D. (Provan)

George, Bruce

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

Gilbert, Rt Hon Dr John

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

Godman, Dr Norman

Brown, Ron (E'burgh, Leith)

Golding, John

Bruce, Malcolm

Gould, Bryan

Caborn, Richard

Hamilton, James (M'well N)

Campbell, Ian

Hamilton, W. W. (Central Fife)

Canavan, Dennis

Hardy, Peter

Clarke, Thomas

Harman, Ms Harriet

Cohen, Harry

Harrison, Rt Hon Walter

Coleman, Donald

Heffer, Eric S.

Cook, Frank (Stockton North)

Holland, Stuart (Vauxhall)

Cook, Robin F. (Livingston)

Home Robertson, John

Corbett, Robin

Hoyle, Douglas

Cowans, Harry

Hughes, Robert (Aberdeen N)

Craigen, J. M.

Hughes, Sean (Knowsley S)

Crowther, Stan

Kaufman, Rt Hon Gerald

Cunliffe, Lawrence

Kennedy, Charles

Dalyell, Tarn

Kirkwood, Archibald

Davies, Rt Hon Denzil (L'lli)

Lambie, David

Davies, Ronald (Caerphilly)

Lamond, James

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

Leadbitter, Ted

Deakins, Eric

Lewis, Terence (Worsley)

Dewar, Donald

Litherland, Robert

663

Lloyd, Tony (Stretford)

Roberts, Allan (Bootle)

McCartney, Hugh

Roberts, Ernest (Hackney N)

McDonald, Dr Oonagh

Robertson, George

McGuire, Michael

Ross, Ernest (Dundee W)

Mackenzie, Rt Hon Gregor

Sedgemore, Brian

McWilliam, John

Sheerman, Barry

Madden, Max

Shore, Rt Hon Peter

Marek, DrJohn

Short, Ms Clare (Ladywood)

Marshall, David (Shettleston)

Skinner, Dennis

Martin, Michael

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

Maxton, John

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

Meacher, Michael

Soley, Clive

Michie, William

Stott, Roger

Mikardo, Ian

Strang, Gavin

Millan, Rt Hon Bruce

Straw, Jack

Miller, Dr M. S. (E Kilbride)

Thompsor, J. (Wansbeck)

Morris, Rt Hon A. (W'shawe)

Tinn, Jamos

Morris, Rt Hon J. (Aberavon)

Varley, Rt Hon Eric G.

Nellist, David

Warden, Gareth (Gower)

Oakes, Rt Hon Gordon

Wareing, Robert

O'Neill, Martin

Welsh, Michael

Park, George

Williams, Rt Hon A.

Patchett, Terry

Wilson, Gordon

Pavitt, Laurie

Winnick, David

Pike, Peter

Woodall, Alec

Powell, Raymond (Ogmore)

Young, David (Bolton SE)

Randall, Stuart

Redmond, M.

Tellers for the Noes:

Rees, Rt Hon M. (Leeds S)

Mr. Norman Hogg and

Richardson, Ms Jo

Mr. Frank Haynes.

Question accordingly agreed to.
Resolved,
That the Rate Reduction (Stirling District) 1983–84 Report, which was laid before this House on 7th July, be approved.

Rates (Kirkcaldy District)
10.39 pm
The Under-Secretary of State for Scotland (Mr. Michael Ancram): I beg to move,
That the Rate Reduction (Kirkcaldy District) 1983–84 Report, which was laid before this House on 7th July, be approved.
The budget return submitted by Kirkcaldy district council and certified as correct by its authority showed that the authority was budgeting to spend 28·9 per cent. above its guideline, significantly more than the district average of 21·8 per cent. Its expenditure per head was above the average of comparator authorities. In addition, it had the highest cumulative rate increase of any authority since 1978–79—220 per cent.—in effect, more than trebling the rate.
Having taken all aspects of Kirkcaldy's expenditure plans into account, the Secretary of State decided to initiate selective action. The district council only then notified the Scottish Office that it wished to change its budget return and transfer funds from its repairs and renewal fund to offset the net expenditure total. Even when that had been done, the excess over guidelines was 25 per cent.—still noticeably above the average.
There was further confusion about the figures submitted by the council as the return included certain housing expenditure, contrary to the advice of the Scottish Development Department. I should make it clear that this had no substantive effect on the reasons for deciding to take selective action, but it led to the clarification that I shall explain.
I met representatives of the council on 23 June, and it proved possible to clear up a number of these matters. In particular, the council representatives agreed that, as a result of returning that expenditure to the housing revenue account and making compensating savings, it would be possible to return £200,000 to the ratepayers. They further agreed that the provision made for inflation when the council's budget was set had proved to be too high. A provision of 8 per cent. had been built into the budget for pay awards, whereas recent awards had been around 5 per cent. and below. The overall inflation provision was 11·8 per cent. The council representatives did not dispute that that had turned out to be far too high. Indeed, they accepted that significant savings could be made in that area and that about £375,000 was available for return to the ratepayers.
The two sums that the council representatives agreed could be returned to the ratepayers amounted together to the equivalent of 1·5p on the rates. On our calculations, the council could comfortably return 2p in the pound to the ratepayers on those two grounds alone. The Secretary of State gave the council the opportunity to return to the ratepayers the savings that its representatives accepted could be made, but I am sorry to say that, following what I felt was a very constructive meeting with the council, the council failed to take that opportunity. Had it taken the reasonable course, instead of choosing the political gesture, there would have been no need for this debate, but the council's inexplicable action left the Secretary of State with no alternative but to lay a report before the House to obtain its approval so that the ratepayers of Kirkcaldy could have the rate reduction to which I believe that they are entitled. I ask for the support of the House.
10.43 pm
Mr. Donald Dewar: I regret that the debate on the fourth report comes so late at night. We have had a long day of Scottish business. We come to this report last not because it is in any sense the least important but merely because one of the reports had to be last just as one had to be first.
In a sense, Kirkcaldy is the most curious case of all. There has undoubtedly been tension for a long time between central Government and the authorities of Lothian, Stirling and Glasgow. Moreover, the finances of Glasgow tend to be examined in great detail merely because it is such a large authority. Until a month or two ago I should certainly not have nominated Kirkcaldy as an authority likely to attract the Secretary of State's displeasure.
When one considers the statistics on how the Kirkcaldy authority has performed in the past year or two, the situation becomes curiouser and curiouser. I take a simple example. The current rate poundage in Kirkcaldy is 29p—substantially below the average of 35p for district councils in Scotland.
Neither the Secretary of State nor on this occasion the Under-Secretary can claim that this is an area in which the ratepayer has been systematically pillaged or victimised. As anybody who has listened to these debates will know, even in the areas where such a plea has been made by the Government, the facts have been very different from those represented. The principal villain has been the right hon. Gentleman, as we have been able to prove to our satisfaction in the past few hours.
There is no case on the ground of rate poundage for moving against the Kirkcaldy district council, but there are the guidelines. Although I wish to give full weight to the arguments on Kirkcaldy's behalf, I do not want to weary the House by going through the arguments about the validity of the guideline exercise. Even if we take the present excess guideline as being a fair test—and that is being charitable in the extreme, or to the point of folly, to the Government's position—a substantial number of our district councils have a larger excess over guidelines, and they have not been victimised or put on the hit list, such as Ettrick and Lauderdale, Dunfermline, Aberdeen, Comnock and Doon Valley, to mention a few.
Kirkcaldy has not been peculiarly victimised, but we can make out a case for it. In 1982–83, its guidelines were £8·36 million, which were the same as the guidelines for the year before. There has been no adjustment for inflation, or any arising from rising costs. That is why that gap has opened. The system has been manipulated to produce that gap, which has allowed the Secretary of State to pick and choose his victims as he feels it to be appropriate.
Nobody should be hit, as I have pointed out before. No Labour Member believes that such buck shot, random, punitive action is justified or necessary. However, let us assume that such an operation has to be put in hand. It is extraordinary to see the way in which Kirkcaldy has been picked. Let us compare it with Kyle and Carrick district council. I do so for a number of reasons. First, it is Labour controlled, so I cannot be accused of picking a Tory council to make a point against the Tories and suggest that it is straight political favouritism.
This is an interesting example because it includes the Secretary of State for Scotland's constituency and should
666
also be a useful example. It might be argued that the two areas are not comparable because Kirkcaldy is on the east coast and Kyle and Carrick is on the west coast, and the former is more of an industrial area than the latter. However, I do not think that the Under-Secretary will object to this example because it is one of the comparable local authorities that he has picked, as he is bound to do to support his arguments for this punitive measure.
Let us start with expenditure per head. One of the district councils spends £74·75 per head, and the other £66·55. Kyle and Carrick is not on the hit list, so it must be the one spending less per head—but not a bit of it. Kyle and Carrick spends considerably more than Kirkcaldy, but it is not on the hit list. It may be argued that there are some peculiar distorting factors in the individual budgets that make up the total. However, the rating review shows that Kyle and Carrick's planned expenditure on libraries, leisure and recreation, burials and cremations, all of which are central to the functions covered by the motion, is more per head of the population than that of Kirkcaldy. For reasons that are difficult to fathom, the council which, in terms of the Secretary of State's test, should have a more acceptable record is on the hit list and the other is not. We could pile anomaly upon anomaly, complication upon complication but I shall not do that.
In cash terms, the rate levy in Kirkcaldy amounts to about £244 per head of the population. If one takes the nine comparable authorities—comparable in population terms—they include the four that the Under-Secretary himself took for his comparability exercise and only two have a lower figure per head than Kirkcaldy. That is another test that could be applied and there are many others. The whole situation has become a farce, and rather an undignified one.
I hope that no one in Kirkcaldy will resent it if I say that they find themselves surprised as well as offended to be in the firing line in such a way. I do not want to labour the protest, but I find it extraordinary that we should be in such a situation. On 22 June the Prime Minister said;
"In recent years the expenditure of local authorities has increased enormously."—[Official Report, 22 June 1983; Vol. 44, c. 56.]
I am not an expert on the English figures, but we have heard a good deal about the Scottish figures this evening and there is no substance whatever in that claim. It is just not so.
The whole intellectual basis on which the persecution has been mounted is cut away. When the Secretary of State opened an earlier debate we heard a superb example of what I call the "nevertheless" principle. He started off by saying that the Government did not wish to interfere in local democracy, nevertheless. He actually said "but", but it is still the "nevertheless" principle. It is always based on a non sequitur. It is a statement not of faith but of prejudice. That is what is happening in the measures before us.
The Secretary of State talks about the poor ratepayers, yet he is the person who has brought their troubles upon them. He says that the measure is necessary because local authority spending is out of control, but their record is infinitely better than that of his Government and Department. He claims that the Government do not wish to interfere in local democracy, yet that is what he is doing, and doing in the most objectionable, offensive and

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radical way that we have seen in the history of negotiations and relationships between local government and central Government in Scotland.
I am convinced that there is no justification in what is being done to Kirkcaldy district council and the House should treat the measure with the contempt and derision that it deserves.
10.52 pm
Mr. Barry Henderson: After about seven hours of debate many major issues have been thoroughly debated and I shall not rehearse them. They include the constitutional position, and the need for Government to accept their responsibility towards the ratepayers has been well explained by my right hon. Friend the Secretary of State in introducing the first debate.
If we do not control the excessive and unreasonable expenditure of a few local authorities, all the others will suffer a reduction in what is available for them, even though they may have been extremely prudent. That is a major reason why I rise to support the measures this evening.
During the period when Kirkcaldy district council had a number of people from that area within my constituency I always enjoyed a good and fair relationship with its councillors and officials. I have no complaint about the relations between the Member of Parliament and the council during that period. But Kirkcaldy district council is not on such good ground as it has argued when lobbying Members of Parliament in talking about democratic rights. When the Labour party took over complete control at the last district council elections it was that council that ruthlessly expelled all its opponents from the council's committees and gave no opportunity for any but the Socialist view to be heard.
Many hon. Members will remember a debate in Committee when we considered whether Parliament should lay down the constitution of the membership of committees of councils to deal with such abuse. Hon. Member after hon. Member rose to condemn what Kirkcaldy had done. No one thought that what it had done was right, although we did not go to the extreme of legislating. We felt that good sense should prevail.
There is absolutely no doubt that Kirkcaldy district could have easily returned 2p to the ratepayers, and it knows that. It is clearly on the record that in the meeting between my hon. Friend the Minister and the council, the provision made for inflation proved to be too high—a sum of £375,000. The council's representatives said that they were prepared to return that sum, together with the £200,000 saved on housing expenditure, to the ratepayers. The only difference between my hon. Friend and the council was not that that sum was available to return to the ratepayers, but that the council wanted to return it next year rather than this year. A suspicious person might wonder if there was any relationship between that and the coming district council elections next May.
There are also other areas in which the council could reasonably have been asked to look after, expenditure. The increase in expenditure on recreation and leisure alone was more than the total reductions for which the Secretary of State was looking in the whole of the council's budget. It has allowed every staff increase requested at any time, except staff increases required for processing the sale of council houses that tenants have the right to buy. Its rates
668
have increased by 222 per cent. in six years—twice as much as all the other districts in Scotland, including Socialist high spenders.
Before there was full Socialist control, Kirkcaldy district council had one of the lowest rates in Scotland. It certainly had the lowest rate in Fife.
Mr. Dewar: Does not the hon. Gentleman accept that Kirkcaldy is still well below the district council average for Scotland? The rate poundage increase for Kirkcaldy and the average for all district councils is almost exactly the same — to be specific, 19p and 20p. The hon. Gentleman's highly coloured, penny-dreadful argument does not stand up to examination.
Mr. Henderson: The hon. Gentleman will appreciate that I cut large chunks from my speech in the interests of all hon. Members. I cut the part that dealt with the special advantages enjoyed by Kirkcaldy district council. One is the considerable rating valuation increase that occurred in Glenrothes. The regional council has substantial additional expenditure because of the growth of Glenrothes, but the district council gains largely from the valuation increases there without having the same increase in expenditure that other local authorities might have had. That is among the reasons why Kirkcaldy had a low rate until the Socialist administration took control. From that point in 1980–81, the rate has risen from 13·5p to 29p—an increase of 115 per cent. Its neighbour, north-east Fife district council, increased its rate by only 15 per cent. during the same period.
The scale of the increase is dramatic. There is no reason why the rates should have increased on that scale. For those reasons I shall support the motion in the interests of the ratepayers of Kirkcaldy.
11 pm
Mr. Willie W. Hamilton: The hon. Member for Fife, North-East (Mr. Henderson) made a similar point with reference to north-east Fife district council at Question Time on 13 July when he said, much as he said tonight, that there was a substantial increase in the rates subsequent to the Tories losing power a few years ago, with the incoming Labour authority, in my view quite properly, seeking to undo the enormous damage that had been done to services under the Tory administration.
For the hon. Gentleman to compare north-east Fife with Kirkcaldy is quite wrong. Not even the Government choose to regard north-east Fife as a comparable authority. Completely different factors operate in the two areas. The complete withdrawal of the housing support grant from Kirkcaldy has meant the loss of about £7 million, whereas a rural authority like north-east Fife suffers no such adverse effect. It was absurd and dishonest of the hon. Gentleman to attempt to compare the record of north-east Fife with that of Kirkcaldy.
I was glad to hear my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) say that he found this measure the most curious of those we have been debating tonight, and he gave some of his reasons for that view. Before dealing with those, I must mention the question of inflation, a subject raised when the district council met the Minister. It is true that the inflation provision in the budget prepared by Kirkcaldy district for 1983–84 provided for an 8 per cent. inflation rate for pay and about 8 per cent. per annum for other costs.

669
It is no good denying that pay awards are currently coming in at rates somewhat lower than that. However, awards are yet to be negotiated in the latter part of the year, and then inflation will be substantially higher than it is now. The estimates of inflation are running at about 8 per cent. 12 months from now, so it may not be far out. There is no certainty about the level of pay awards to come or about the eventual level of inflation increase. On their own admission the Government agree that in the coming months inflation will go steadily up.
In any case, it has always been the council's policy that inflation is a provision in the budget to be spent only as required because of rising costs. My hon. Friend the Member for Garscadden pointed out that when assessing the guidelines, the Government for the past two years have arbitrarily fixed them at the same figures, regardless of any possibility of increased costs.
The district council submitted to the Secretary of State a revised budget form, POBE, for 1983–84 reducing the relevant expenditure by £330,000, the equivalent of a penny rate, and up to a few moments ago the council had had no indication from the Scottish Office that the Department was not prepared to accept that. Scottish Office officials are listening to me saying that only now does the council realising that the Government want their full pound of flesh, 2p in the pound. The council has conceded 1p, but that is not enough, and it would have saved a great deal of time if the Government had said "We realise that Kirkcaldy district council has come some way towards us"—Government spokesmen have said that the guidelines are only a rough and ready measure, not a hard and fast rule—"and has shown, while not agreeing with us, that it realises that the Government have some rights in these matters".
My hon. Friend the Member for Garscadden gave some figures. When one studies the figures placed in the Library by the Government one sees, taking a succession of yardsticks by which to measure the profligacy or otherwise of Kirkcaldy, that there are no grounds—or, at least, hardly any grounds—for treating Kirkcaldy in this way. For instance, there are at least seven district councils that have a worse record, to use the jargon of the Government, of expenditure over the Government's guidelines, yet Kirkcaldy is singled out for exceptional and draconian treatment.
The second point is that in the past five years, at least 10 other district councils have spent more per head of the population than Kirkcaldy. The third fact is that Kirkcaldy is 30th in the league of comparisons of increased expenditure this year compared to that of 1982–83. I am quoting these figures from the official statistics in the Library.
The fourth fact is that the global changes in expenditure over a five-year period, despite what the Minister has said, showed that at least 12 other district councils have a worse record than Kirkcaldy.
The fifth fact is that at least 19 district councils have a higher rate poundage then Kirkcaldy. That is the picture shown by the Government's figures.
The story is even stranger than that. The Kirkcaldy district council is spending, not £10·78 million, but £10·45 million—a figure accepted by the Government—so its position should become much more acceptable to the
670
Government than that of at least a score of other district councils in Scotland. I shall deal with that at greater length later.
The point has been made, and I think that it is worth repeating, that when the Government first took office in 1979, they pledged that they would devolve more power to local authorities from the centre, but since then the opposite has happened in a variety of ways. Local authorities, of all political persuasions, are extremely disturbed at the increased centralisation of decision-making and the increased feeling that local authorities must be subservient agents of central Government.
I shall give examples of how that has developed. As has been said many times before, the rate support grant has been reduced substantially as a proportion of the money available to local authorities—from 75 per cent. in 1975–76 to 61·7 per cent. in 1983–84. In addition there is the continued deflation of the expenditure base for calculating RSG. So local authorities have been enormously disadvantaged by the Government's manipulation of the rate support grant.
A further example is the alteration in the methods of computing and distributing rate support grant. Kirkcaldy district has made another point, that the Government have provided for the derating of outdoor industrial plant and machinery which means a loss of rateable resources without any compensatory payment to the local authority, which means inevitably higher rates for the rest of the community.
Another factor is the phasing out of the housing support grant—housing subsidy as it was known. In 1980–81 Kirkcaldy district council received housing support grant of nearly £7 million. In 1983–84, it is nil. So the council had to find that money by one means or another as a direct consequence, not of its own profligacy, but of a deliberate policy of this Government.
Another factor is the limitation of rate contributions to the housing revenue account. For Kirkcaldy district, that meant £1·75 million, the equivalent of a 4½p rate. Those are a few examples of how local authorities have been whiplashed by the Government in a succession of deliberate policy decisions. Now the Government have imposed rate levels that are based on arbitrary judgments and opinions as to what constitutes excessive and unreasonable expenditure. The little man in New St. Andrew's House is sitting there deciding what is unreasonable and unfair expenditure in places such as Kirkcaldy, Stirling, and elsewhere. That is an impossible, dictatorial imposition and it has no rational basis.
The Secretary of State, in his letter of 5 May, decreed that Kirkcaldy district council had indulged in, and was continuing to indulge in, excessive and unreasonable expenditure. He has taken powers to exercise that judgment made by the little guy in New St. Andrew's House and to penalise councils which dare to question it. He, the Secretary of State for Scotland, decreed that Kirkcaldy district must reduce its rates by 3p in the pound. That means cutting its proposed expenditure for 1983–84 by about £1 million.
I have been through the figures with the Kirkcaldy district time and again. Its members say to me, "Please, Willie, ask the Secretary of State to tell us what to cut." We have challenged the district Tory councillors to tell us what services they will cut. The Under-Secretary's hit man in Kirkcaldy district is Councillor Mason, the hon. Gentleman's paid hack. He is the guy who is carrying the

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coat tails. That is one of the reasons why Kirkcaldy district is singled out for this unfair treatment. That man Mason is telling the Government that Kirkcaldy council should be clobbered because of the allegedly undemocratic way in which the newly elected Labour-controlled council a few years ago got rid of the Tories and others on the committees. I made my view known on that, but that is no reason why the vendetta should now be carried to the extent of threatening Kirkcaldy district with penal measures if it does not reduce the rates in accordance with the edict from New St. Andrew's House.
The Minister said earlier that he does not intend to tell local authorities how to save the money, but presumably he has made a judgment about where or how they are wasting it. He has come to a global figure of 3p in the pound. Why was it not 4p, or 2p, or 2½p? Someone must have looked at the expenditure item by item, and decided that certain items could be cut out, and arrived at the global figure of 3p. No one will ever know how that 3p was arrived at. Moreover, in his letter of 23 June he said, suddenly, that it could be 2p. How was that figure reached? Was it just an arbitrary decision made in New St. Andrew's House, following representations by Kirkcaldy district?
At the meeting of 23 June the Minister said that in taking his action he had regard to three factors. The first was the council's excess over guidelines, compared with other district councils. The second was the level of expenditure per head planned for 1983–84, compared with comparable authorities. The third was the substantial increase in the council's rate poundage, both since 1982 and over the longer period from 1978–79.
My hon. Friend the Member for Garscadden referred to the rate poundage, as did the hon. Member for Fife, North-East. In the last three years, under the Labour-controlled council, the rate poundage in Kirkcaldy increased from 13·5p in 1980–81 to 29p in 1983–84. That decision was deliberately taken by a democratically elected Labour-controlled council to repair the ravages of the previous Tory administration. That is what democratic local government is about.
Between 1980–81 and 1983–84, Kirkcaldy's rate poundage was less in each year than the average for all Scottish district councils. Kirkcaldy is not out of line with the general run of rate poundages in Scotland. The Kirkcaldy district council's average rate poundage per year over the last six years is 18·1p, whereas the average for all district councils is 25·2p. On that count Kirkcaldy comes out well.
The average rate poundage over the same six years in what the Government call "closely comparable" district councils — Cunninghame, West Lothian, Kyle and Carrick, Kilmarnock and Dunfermline—is 22·8p. There is little evidence, whatever yardstick one uses, to allege that Kirkcaldy district is a profligate, irresponsible local council.
The Minister's second charge against Kirkcaldy is that the level of expenditure per head planned for 1983–84 compares unfavourably with similar authorities. The average over the last six years in Kirkcaldy is £59·42 per head, against £59·01 in other comparable authorities.
At the meeting in June the Minister referred specifically to the expenditure per head planned for 1983–84. The Minister's assertion is not borne out by the facts. The figure for Kirkcaldy was £62·56, for Cunninghame £64·76, for Kilmarnock £63·90 and for Kyle and Carrick
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£74·76. The average for all closely comparable district councils was £61·95. The most closely comparable authority to Kirkcaldy is Cunninghame because it also has a new town.
The Minister's third charge against Kirkcaldy is that its proposed expenditure far exceeds the guidelines. Enough has been said to condemn guidelines as having no statutory authority. Guidelines are merely suggested limits for local authority expenditure. They are not the basis on which to build global expenditure for rate support grant purposes.
The guideline for Kirkcaldy for 1982–83 was £9 million. Arbitrarily, the Government reduced that to £8·36 million. No reason was given for that figure. Similarly, for the next year — 1983–84 — the guideline of £9·605 million was arbritrarily reduced to the same figure as for the previous year, £8·36 million. No provision whatever was made for inflation. The local authority just had to meet that out of what it could get from the rates. In 1982–83, Kirkcaldy's cash expenditure was £9·26 million, and in 1983–84, it was £10·78 million. That figure has now been revised to £10·45 million, so that the increase over the guidelines is 25 per cent., which compares favourably with the district council average for Scotland of 21·8 per cent.
However, there are no figures for the so-called five comparable local authorities. If they are comparable with Kirkcaldy, they should have comparable guidelines. Perhaps the Minister will say whether they do have comparable guidelines. Appendix A in the Minister's original communication does not say that. But in any case, as a Scottish Office witness said at the Joint Committee on Statutory Instruments:
"the guidelines are indicative, not definitive, and in no way mandatory."
Therefore, I doubt whether the Minister has any legal status in this. Kirkcaldy district council might challenge the Government about whether they can deal with Kirkcaldy or any other authority in a matter for which there is no statutory basis. In 1983–84, 62 out of the 65 local authorities in Scotland exceeded those guidelines. Only three out of the 65 managed—and then only just—to keep within them. That shows that there is something undeniably wrong with the guidelines.
Other hon. Members will probably get a document from the Society of Local Authority Chief Executives. It has no political axe to grind, and is concerned only to maintain and foster a healthy democratic system of local government throughout the United Kingdom. The society represents all authorities in the United Kingdom. It put forward a list of 11 principles and objectives as essential foundations to effective and healthy local government. Hon. Members will be gratified to know that I do not intend to quote all 11, but I shall cite four of them. The third principle states:
"Individual local authorities should have the freedom, and should be encouraged, to innovate and undertake new initiatives in responding to the needs of their inhabitants within their democratic mandate. In furtherance of this objective, local authorities should continue to have a general power to incur expenditure in the interests of their inhabitants."
That is precisely the sort of power that is being denied those authorities tonight. The fifth principle states:
"The total financial resources available to local authorities should be sufficient to enable them to perform their functions adequately."
Again, that principle will he denied to local authorities both tonight and, in future, by the Government.
The sixth principle states:

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"Local authorities' financial resources should include independent sources of revenue whose level can be fixed at the discretion of the individual authority."
The principle says that the fixing of the level should be at the discretion not of the central Government or of the Scottish Office, but of the individual democratically elected local authority.
The eighth principle is that the
"system of local government should ensure that individual local authorities are fully accountable to their electorates and local taxpayers for their expenditure decisions."
They are clear and sound principles that are being undermined by the Government.
Local government at all levels throughout the United Kingdom has seldom been so demoralised as it is now. It has seldom felt so threatened by the ever-increasing and malevolent interference by central Government. Local councillors and their officials feel increasingly that local government is becoming a mere rubber-stamping agent of a central Government who are hell-bent on regarding almost every service that is provided by local government or central Government as a profit-making opportunity for greedy and often unscrupulous speculators. The story is the same in housing, health, education and in almost every other sector.
Local authority services are being increasingly regarded as fair game for the gravy-train camp followers of the Tory party. The local authorities that dare to resist these pernicious pressures from central Government will be either whipped into line, as is happening tonight, or abolished, as in the case of London, and as will happen to the metropolitan boroughs if the Government have their way. All local authorities are under threat if they do not toe the line of this increasingly dictatorial Government, who have no mandate in Scotland.
11.27 pm
Mr. Ancram: If there were any truth in the closing sentences of the hon. Member for Fife, Central (Mr. Hamilton), and if he regards the motion as an entirely politically motivated action, is it not surprising that so many councils which fit his description have not had selective action taken against them? Only four councils of the many councils in Scotland have had selective action taken against them, which shows the care with which my right hon. Friend the Secretary of State made his assessment of what council spending was excessive and unreasonable.
Mr. Tom Clarke: The hon. Member for Fife, North-East (Mr. Henderson) answered the Minister's question. He said that if action was not taken against the authorities named in the motions, other authorities might feel brave and emulate the decisions that the named authorities have taken. In other words, the Government have set out deliberately to use these authorities, including Kirkcaldy, to frighten off other authorities.
Mr. Ancram: If the hon. Gentleman is saying that in taking selective action against authorities whose spending is obviously unreasonable we are setting an example to other authorities not to spend in the same way, that is a purpose that I hope will be achieved by this action.
Mr. Henderson: I am sure that my hon. Friend did not mean to mis-paraphrase me. I said that it was important
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that other authorities that are more careful in their spending should not be hit because of the wild overspending of a relatively few authorities.
Mr. Ancram: That also is a valid point.
The hon. Member for Glasgow, Garscadden (Mr. Dewar) asked why Kyle and Carrick had not been treated in the same way.
Mr. Dewar: I do not want it to be.
Mr. Ancram: In that case, I am sure that the hon. Gentleman is relieved that it is not. However, he asked why it had not been treated in the same way. I had hoped that at the end of this lengthy day the one message that I had put across was that there is not one single criterion for taking action. Balanced criteria have to be taken into account. The hon. Gentleman's argument about expenditure per head in Kyle and Carrick may be valid. Kyle and Carrick's budget excess was below the district average. On the various balances of criteria, if he thinks about it, Kyle and Carrick would not have been a sufficient candidate for such action. He must realise that in the case of Kirkcaldy, just as in the other cases that we have discussed, a balance of criteria was carefully examined before any decision to take selective action was taken by my right hon. Friend.
My hon. Friend the Member for Fife, North-East (Mr. Henderson) gave a good and reasoned breakdown of the spending pattern in a council such as Kirkcaldy that can lead to excessive and unreasonalbe expenditure. The hon. Member for Fife, Central (Mr. Hamilton) raised many questions. I am sure that the House will not wish me to deal with all of them. If there are any that I have missed, perhaps he will write to me about them. He referred to the inflation provision. I said that it was at a rate of 8 per cent. for pay awards, which he agreed with, but the overall inflation provision was 11·8 per cent. I am sure that he will agree that that is a high figure in comparison not only with the present rate of inflation—after all, we are one third of the way through the financial year—but with the projected rate of inflation. In terms of the budget expenditure, which my right hon. Friend looks at, if provision for inflation at that high rate is not needed, it should be returned to the ratepayers and if it is used in any other way, it becomes expenditure and should be assessed as part of the relevant expenditure for the purpose of assessing excess over guidelines. Therefore, the Government have rightly taken that into account.
The hon. Gentleman said, to my surprise, that tonight Kirkcaldy district council learnt for the first time that we were asking for 2p from it. When the representatives came to see me, they knew full well that they were entitled, if they wished, to come back to me. That was made clear before they left. Four days later when my right hon. Friend announced that he was reducing the demand on the council from 3p to 2p and that it had until 6 July to say whether it would accept that, it could have been in no doubt as to what the position was. The suggestion that it was not told until tonight is remarkable. In the hon. Gentleman's analyses, he seemed to miss the point that in Kirkcaldy's case, as in the case of all the other districts against which we have taken selective action, a balance of criteria, not one single criterion, must be taken into account when making comparisons with comparative authorities.
My right hon. Friend and I considered the representations that were made to us about Kirkcaldy. In the light of those representations, a reduction was made

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from 3p to 2p. For the reasons that I gave, and as there is still an excess on the guidelines over the above the district average, expenditure per head is still also above the average of comparative authorities, and there has been the highest cumulative rate increase since 1978–79, excessive and unreasonable expenditure is being incurred by the council. I ask the House to support the report.
Question put:
The House proceeded to a Division
Mr. Lang and Mr. Garel-Jones were appointed Tellers for the Ayes, but no Member being willing to act as Teller for the Noes, Mr. Deputy Speaker declared that the Ayes had it.
Resolved,
That the Rate Reduction (Kirkcaldy District) 1983–84 Report, which was laid before this House on 7th July, be approved.

Orders of the Day

  Medical Bill [Lords]
  Order for Second Reading read.
  11.36 pm
  The Solicitor-General (Sir Patrick Mayhew): I beg to move, That the Bill be now read a Second time.
  The Bill has an unprecedented legislative history, as do the other two Bills that we shall consider today. All three are identical to Bills that fell at the dissolution of the previous Parliament. At that point, they had completed all or most of their stages in another place and they had all been considered by the Joint Committee on Consolidation &c. Bills, which had duly reported.
  When the three Bills were introduced in another place, it was wisely resolved that in those special circumstances they should not be referred to the Committee, notwithstanding Standing Orders. I emphasise that these Bills are identical to those which were considered by that Committee in the previous Parliament only a few weeks ago.
  It is a happy custom to thank the members of the Joint Committee for ensuring that consolidation Bills are in proper form when they come here. I should like to express our thanks to the Committee in respect of this and the other Bills that we shall consider today. I hope that, subject to the technical amendments, the House will think it right to give the Bill a Second Reading.
  11.38 pm
  Ms. Harriet Harman: The Opposition have no points to make on any of the three Bills. We also should like to thank the Joint Committee on Consolidation, &c. Bills for its work. It is an unenviable task. We welcome the consolidation as making the law more accessible and less complicated. We look forward to more consolidation measures.
  Question put and agreed to.
  Bill accordingly read a Second time.
  Bill committed to a Committee of the whole House.—[Mr. Goodlad.]
  Bill immediately considered in Committee.
  [MR. HAROLD WALKER in the Chair]
  Clauses 1 to 39 ordered to stand part of the Bill.

  Medical Bill [Lords]
    Clause 40

      APPEALS
      The Solicitor General: I beg to move amendment No. 1 in page 32, line 43, leave out `(5)' and insert `(2)'.
      This is little more than a printing correction Clause 40(3) refers erroneously to section 39(5). As hon. Members can see, there is no subsection (5) in clause 39, and the reference should be to section 39(2).
      Amendment agreed to.
      Clause 40, as amended, ordered to stand part of the Bill.
      Clauses 41 to 57 ordered to stand part of the Bill.
      Schedules 1 to 5 agreed to.

    Schedule 6

      TRANSITIONAL AND SAVING PROVISIONS
      The Solicitor General: I beg to move amendment No. 2, in page 64, line 17, after 'in', insert 'the repeals made by'.
      Paragraph 5 of schedule 6 is a transitional provision intended to ensure that existing entries on the register of medical practitioners are not affected by the repeal in this consolidation of the enactments under which they were made. Unfortunately, as it stands, paragraph 5 could be interpreted as meaning that the provisions of the Bill on suspension and striking off could not be applied to any practitioner registered under the enactments being consolidated, which would be absurd. The addition of the words "the repeals made by" avoids that possibility.
      Amendment agreed to.
      The Solicitor General: I beg to move amendment No. 3 in page 67, line 29, leave out 'this Act' and insert 'the 1956 Act'.
      This is to correct a mistake. Paragraph 24 of schedule 6 is another transitional provision, its purpose being to allow continued reliance upon certain provisions of the Medical Act 1956 notwithstanding that they have been repealed —I should add, repealed not by this Bill but by the Medical Act 1978. Part of its operation depends upon a registered medical practitioner's being enabled to satisfy the General Medical Council of matters specified in section 22(2) of the 1956 Act and not, as paragraph 24(2) of the schedule erroneously says at present, in clause 22(2) of this Bill.
      Amendment agreed to.
      Schedule 6, as amended, agreed to.
      Schedule 7 agreed to.
      Bill reported, with amendments.
      Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 58 (Third Reading), and agreed to.
      Bill accordingly read the Third time, and passed, with amendments.

  Car Tax Bill [Lords]
  Order for Second Reading read.
  The Solicitor-General (Sir Patrick Mayhew): I beg to move, That the Bill be now read a Second time.
  This Bill is strict consolidation, bringing together the law relating to car tax. It was originally provided for in the Finance Act 1972, but there have been several amendments in subsequent Finance Acts and in other Acts and statutory instruments. The time is now ripe for consolidation.
  11.44 pm
  Ms. Harriet Harman: I refer the House to the comments that I made on the Medical Bill [Lords].
  Question put and agreed to.
  Bill accordingly read a Second time.
  Bill immediately considered in Committee.
  [Mr. HAROLD WALKER in the Chair]
  Clauses 1 to 11 ordered to stand part of the Bill.
  Schedules 1 to 3 agreed to.
  Bill reported, without amendment.
  Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 58 (Third Reading), and agreed to.
  Bill accordingly read the Third time and passed, without amendment.

  Value Added Tax Bill [Lords]
  Order for Second Reading read.
  11.47 pm
  The Solicitor-General (Sir Patrick Mayhew): I beg to move, That the Bill be now read a Second time.
  As it stands, the Bill is strict consolidation and brings together the law on value added tax.. This was first provided for in the Finance Act 1972 but there have been amendments in every subsequent Finance Act, in the legislation relating to the Commissioners of Customs and Excise and in numerous statutory instruments made under powers contained in the 1972 Act. It is, therefore, an appropriate time for consolidation.
  This is also the appropriate time to welcome the hon. Member for Peckham (Ms. Harman) to the Opposition Front Bench, and I do so very warmly.
  I should mention now that an amendment will be required in Committee to take account of the recently made Value Added Tax (Works of Art, Etc.) Order 1983.
  Subject to that, I commend the Bill to the House.
  Question put and agreed to.
  Bill accordingly read a Second time.
  Bill immediately considered in Committee.
  [Mr. HAROLD WALKER in the Chair]
  Clauses 1 to 51 ordered to stand part of the Bill.
  Schedules 1 to 5 agreed to.

  Value Added Tax Bill [Lords]
    Schedule 6
      EXEMPTIONS
      The Solicitor-General: I beg to move amendment No. 1, in page 72, line 7, at end add—

      'GROUP II—WORKS OF ART, ETC.
      Item No.
      1. The disposal of an object with respect to which estate duty is not chargeable by virtue of section 30(3) of the Finance Act 1953, section 34(1) of the Finance Act 1956 or the proviso to section 40(2) of the Finance Act 1930.
      2. The disposal of an object with respect to which capital transfer tax is not chargeable by virtue of section 32(3)(a), or (4), 34(6)(a), or the words following paragraph (b) of section 34(6) of the Finance Act 1975.
      3. The disposal of property with respect to which capital transfer tax is not chargeable by virtue of section 78(4) of the Finance Act 1976.
      4. The disposal of an asset in a case in which any gain accruing on that disposal is not a chargeable gain by virtue of section 147(2) of the Capital Gains Tax Act 1979.'
      This is a consequence of the Value Added Tax (Works of Art, Etc.) Order 1983. That order adds a new group 11 to Schedule 5 to the Finance Act 1972. Therefore, the amendment adds a new group 11 to schedule 6.
      The order was made on 31 May, after the Dissolution of the previous Parliament and came into force on that day. It was not laid before the House until we assembled on 15 June and the 40 days during which it may be prayed against do not expire until next Monday. It is, of course, theoretically possible that it will be prayed against and thus cease to be law. In that case, it would be wrong for the Bill, when enacted, to contain provisions along the lines of the amendment. I therefore undertake that matters will be arranged in such a way that the Bill will not be presented for Royal Assent until after Monday and that in what I regard as the highly improbable event of a prayer against the order the Bill will be brought back for the amendment to be deleted.
      Amendment agreed to.
      Schedule 6, as amended, agreed to.
      Schedules 7 to 11 agreed to.
      Bill reported, with an amendment.
      Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 58 (Third Reading), and agreed to.
      Bill accordingly read the Third time and passed with an amendment.

    STATUTORY INSTRUMENTS, &c.
    Motion made, and Question put forthwith, pursuant to Standing Order No. 79(5) (Standing Committees on Statutory Instruments, &c.)
    STATUTORY INSTRUMENTS, &c.

      TERMS AND CONDITIONS OF EMPLOYMENT
      That the draft Redundancy Payments (Local Government) (Modification) Order 1983, which was laid before this House on 6th July, be approved.—[Mr. Goodlad]
      Question agreed to.

    EUROPEAN LEGISLATION
    Ordered,
    That Mr. Kenneth Carlisle, Mr. Stan Crowther, Mr. Hugh Dykes, Mr. Ray Ellis, Mr. Bryan Gould, Mr. Alan Haselhurst, Mr. Robert Hicks, Mr. Mark Hughes, Mr. David Knox, Mr. David Madel, Mr. Gerald Malone, Mr. Tony Marlow, Mr. Iain Mills, Mr. Nigel Spearing, Mr. John D. Taylor and Mr. Bowen Wells be members of the Select Committeee on European Legislation. — [Mr. Goodlad.]

  Newspaper Industry (Industrial Relations)
  Motion made, and Question proposed, that this House do now adjourn.—[Mr. Goodlad.]
  11.51 pm
  Mr. Maurice Macmillan: I asked for this debate because the present Financial Times dispute coinciding with the White Paper on trade union legislation emphasises once more the peculiar dangers of strike action in the newspaper industry and the damage that it can do to the national interest.
  I do not wish to spend long on the details of the Financial Times dispute, because I am more concerned with the additions that it has provided to the body of evidence that has mounted up over the past six years of what amounts to effective censorship of the press through industrial action by production staff, notably by the National Graphical Association. The present stoppage at the Financial Times, whatever the reasons for it, is itself a considerable interference with the liberty of the press, especially as it began during a general election period.
  As the House knows, the Financial Times stopped printing on 1 June when all 270 of its NGA workers were called out in support of a dispute involving the 24 NGA workers in the press room, of whom only eight were wholly employed by the Financial Times, the others working partly for the Financial Times and partly for other newspapers.
  It is important to recognise that there was no dispute between the Financial Times and the other print union, SOGAT 82. Indeed, for the Financial Times to give in to the NGA and to meet all its demands would seriously disrupt the pay differentials accepted by SOGAT 82 as part of the wider press room agreement to which SOGAT 82 and the Financial Times have kept but which the NGA now disputes.
  The dispute continued. On 29 June, after a series of discussions at ACAS, the Financial Times and the union began talks under the guidance and supervision of an independent mediator sitting with two assessors. Their object was to seek a press room agreement on staffing, pay and productivity, and they hoped to complete that agreement by 3 July.
  The arrangements for these talks were formally accepted by both sides and were fully supported by Mr. Len Murray of the TUC. Mr. Murray confirmed in writing that the TUC expected both parties to respect the outcome of the agreed procedures and act on its recommendations.
  The mediator made his recommendations on 3 July. They were immediately accepted by the Financial Times. On 7 July, the NGA held a meeting, as a result of which it objected to the recommendations of the mediator. Its main reason for doing so was that the proposals did not give it a 19·5 per cent. differential over the SOGAT members of the printing staff, a differential that is more than any other similar one in Fleet street, and more than has been enjoyed by the NGA over SOGAT in the Financial Times. Today we have learnt that the NGA has refused to consider the peace plan of Mr. Len Murray and Mr. Lowry, the chairman of ACAS.
  Now, despite all the efforts of the management concerned, which if anything has been too weak rather than too harsh with the unions, and despite the fact that
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  there has been no dispute with the other unions in the print rooms—which stand to suffer if the NGA gets its way—and that the TUC has made every effort to bring the NGA to its senses, the Financial Times is still not being produced.
  I hope that the Minister and the Secretary of State find this situation as intolerable as I do. The loss of circulation and advertising to the newspaper can never be recovered. The Financial Times is losing about I million a week. The international edition is losing long-term contracts to the Herald Tribune and the Wall Street Journal, whose circulation has gone up by 4,000 a day since the strike started. The Financial Times has not taken an intransigent attitude. Only now has it decided that it must reduce SOGAT wages to the Newspaper Publishers Association basic rate. Only now is it seeking SOGAT agreement for alternative printing arrangements for the international edition. In other words, in the interests of getting as smooth a transaction as possible to the modern technological methods so essential to maintain its competitive position abroad as well as here, it has made every possible attempt to bring the unions along with it.
  The condition that makes such things possible is the closed shop. Without it, it would be possible for management to bring in alternative labour without causing trouble or being in breach of agreement with the other unions. There are some palliatives other than doing away with the closed shop that could help in such circumstances. They are enforceable lay-off clauses, and enforceable contracts of employment. However they would not be nearly as effective as outlawing the closed shop, at least in the newspaper industry because of its peculiar and particularly important position, although one could go some way in that direction by making the union rather than the individual liable for damages for breach of contract in cases where a closed shop is in force.
  I hope that the Government will agree that some special action is needed. However weak and unco-ordinated the Newspaper Publishers Association Ltd. might be—it has not always shown up very well in these situations—we are confronted with an almost impossible situation in which only the Government can give any long term help.
  I also hope that the Government will agree that quite apart from other considerations the threat to the freedom of the press justifies special measures in the newspaper industry. As Lord Denning said in giving judgment in another context
  "Interference with the freedom of the press is so contrary to the public interest that it has to be regarded as the unlawful employment of means."
  Another aspect of the NGA's activities is its ability to interfere with the liberty of the press in reporting disputes in which we are involved and to use industrial power to prevent the publishing of news, comment or advertisements which are politically unacceptable to them.
  In this current dispute, the Financial Times put out two advertisements. The first was carried by The Guardian on Friday 24 June, but The Times and the Daily Telegraph, for one reason or another, did not feel able to print, even as an advertisement, that explanation of the Financial Times' position. The Financial Times produced a follow-up, carrying on its explanation on Monday 18 July. That fared better and appeared in The Times, although the Daily Telegraph continued to feel unable to print such an advertisement.

  683
  I have certain indications that comment on this dispute has been modified in one way or another for fear of causing union trouble. I must admit that I have no hard evidence that would stand up in court but people are understandably worried in such situations about coming forward. As Mr. David Astor pointed out in a famous article as far back as 1977
  "public cases of press censorship by unions constitute only the tip of an iceberg".
  There are more instances under this Government.
  In April 1979 the NGA blacked advertisements inserted by advertisers who were also using the Nottingham Evening Post with which the NGA was in dispute. The High Court made an order to stop that. The NGA appealed and it was rejected by the Master of the Rolls, Lord Denning. He said
  "The union has no right to use industrial strength to interfere with the freedom of the press."
  He continued with the words which I quoted previously.
  On 16 July 1982, The Standard reported a speech by the Secretary of State for Employment in which he praised Mr. Joe Wade of the NGA for giving a direct and blunt warning to the print trade of the need for more flexible working practices and the acceptance of new technology. Mr. Wade also said that in Holland where the technology had been accepted there was a shortage of printers and in the United Kingdom there was unemployment among printers.
  Apparently that praise was not welcome, for both it and Mr. Wade's photograph were cut out of later editions of The Standard having appeared in the first edition.
  In September 1982 the editorial of the Daily Mail on the TUC day of action was blacked because the NGA chapel disapproved of the context and the editor rightly refused to alter it.
  Later still, on 6 June this year, The Times reported that the Daily Express leading article on the march for jobs rally had failed to appear in the paper's first edition when a demand by the NGA for right of reply on the same page was refused.
  None of those or other similar incidents appear to cause much concern to Members of Parliament or to the media. Perhaps they are too trivial, but I do not think that they are. They do not seem to worry my right hon. Friend the Secretary of State for Employment or even my right hon. Friend the Prime Minister. Yet when The Times failed to appear on 13 January 1977, their reaction in Opposition to what they regarded as censorship of The Times by the NGA was fierce and immediate. In response to the right hon. Member for Cardiff, South and Penarth (Mr. Callaghan), the then Prime Minister, when his reaction to that gross infringement of the freedom of the press appeared to be inadequate, my right hon. Friend the Prime Minister, then the Leader of the Opposition, shouted:
  "I little thought that I would ever hear a Prime Minister uphold the censorship of the Press, because that is what he has done." — [Official Report, 13 January 1977; Vol. 923, c. 1638.]
  On that occasion my right hon. Friend the Secretary of State for Employment expressed no less strongly his sense of outrage.
  Yet nobody now appears to worry too much. One might say "Where have all the protests gone?" I hope that it is not because we have come to consider such incidents as too trivial to worry about. After all, there are other
  684
  newspapers. The press is still relatively healthy. There is a local press, a regional press and a number of national newspapers. These incidents have affected very few.
  I hope that it is not the case, as it is in so many other areas, that we are becoming so used to that type of abuse that we tend to accept it as an inevitable part of modern life, without there being much that anyone can do about it. Trivial as some of the incidents may appear, it is impossible to regard any threat, large or small, to the freedom of the press to publish what it likes under the law to be unimportant.
  The Government must not allow over-powerful groups of individuals, not even the NGA, to interfere with the liberty of the subject and the freedom of the press.
  12.8 am
  The Under-Secretary of State for Employment (Mr. John Selwyn Gummer): How well I understand the concern felt by my right hon. Friend the Member for Surrey, South-West (Mr. Macmillan) that has led him to raise this matter on the Adjournment. He was right to suggest that it is not simply a response to the most recent strike that has affected the Financial Times. There is a much wider feeling of concern.
  As one whose connections with the printing industry stretch back over 20 years, I am well aware of the serious effects on the printing industry of the actions of trade unions which, instead of using their power for the benefit of the people they serve, or for the nation as a whole, have sought to use it for narrow and short-term reasons. As the Royal Commission suggested, the spotlight turned on what is wrong in Fleet Street and, in a sense, turned on what has been deeply wrong in our country as a whole.
  The problems of Fleet Street are perhaps more important than the problems of any other industry. As my right hon. Friend said, they are a matter not merely of industrial dispute but of the very freedom of the press. The industrial dispute, which may be for a specific reason—perhaps about pay or conditions — can destroy the opportunity of thoughts, views and attitudes being put over. It has begun to dawn on people how much damage has been done, and I support the comments made by my right hon. Friend about some of the occasions when there have been clear and undoubted attempts to censure the press. He mentioned some and I will mention some others.
  My right hon. Friend will remember some of the activities during the so-called day of action when a Liverpool newspaper was unable to print material which it wished to print because of the action of the National Graphical Association. My right hon. Friend referred to the Daily Mail being unable to produce a leader and having to leave that space in its newspaper empty because of the action of one of the unions. It was repeated by the Press Council, and I quote from that repeat in 1977:
  "Newspaper industry workers and trade unions are not in a special, privileged position in regard to the publication of material of which they are critical. Their rights are no greater and no less than those of the rest of the public. Like everyone else, they are entitled to the assurance that impartial consideration will be given by the Press Council to any complaint made by individuals, chapels or unions about a newspaper's content or conduct. No-one should usurp an editor's responsibility to the public and to the law for what appears in his newspaper."
  It is the attempt to usurp the editorial powers that has done so much damage to the newspaper industry, and I applaud my right hon. Friend for raising the matter.
  I am tempted to join my right hon. Friend in his comments about the problems at the Financial Times. I

  685
  must restrain myself from that because, although the present news is bad and things look difficult, and despite the clear attempt by Mr. Len Murray and the TUC to find an answer to the problem, with ACAS considerably involved, I feel that it would be a mistake to make the solution more difficult by the kind of comments one might make on the Floor of the House.
  That is not because I do not feel them strongly; but the talks are to continue and I am concerned that the newspaper should get back on to the streets, not least because of the remarkable job it has been doing in the rest of Europe, establishing itself, and it is that establishment which my right hon. Friend mentioned, fearing that it will have lost out considerably to its competitors.
  It is well known that, not just on this issue but on others, for one reason or another Fleet Street has been particularly vulnerable to this sort of self-inflicted wound. The great sadness is that the effect of these strikes has been not to protect the jobs which so often they are supposed to do, but actually to reduce them. In April 1970 there were 155,800 employed in the industry. There are now 140,000.
  At the beginning of the final report of the Royal Commission on the Press appeared a quotation from Sir Arthur Conan Doyle's "The Blue Carbuncle". In 1892 an advertisement was to be placed in the evening newspapers. When somebody asked which evening papers, the answer was:
  "Oh, in the Globe, Star, Pall Mall, St. James's Gazette, Evening News, Standard, Echo and any others that occur to you."
  That could not happen today. The only remaining evening newspaper in London is The Standard. As a boy, I remember a vendor on the street corner shouting, "Star, News, Standard". The Star and the Evening News have gone and The Standard is left. The number of jobs is reduced. When I read that when the trade unions decide that they might like to produce their own newspaper—it is right to have as wide a range of newspapers as possible —what do I see? I see that they look to a newspaper which has new equipment and uses new techniques—the techniques that trade unions have stopped being used in any of the present newspapers—because they admit that that is the only way to make a newspaper work, to produce a new newspaper and to create new jobs in the newspaper industry.
  How sad it is that in regarding what they want to do for themselves, those unions have to admit that they too do the opposite to that which they have done for years and years. They have to welcome new techniques, new technology, remove the threat of industrial action and ensure that a newspaper can depend upon regular daily production.
  If that is necessary for a new trade union newspaper, it is just as necessary for those newspapers which exist already. The sadness of the industry is that we have seen, year after year, a decline in the number of newspapers.
  I remember as a schoolboy that the Daily Telegraph's politics were balanced in our house by buying the News Chronicle. That cannot be done today. One has to put up with a restricted number of newspapers. There is no Daily Herald. Who has killed those newspapers? It must be the restrictive practices, because today's modern techniques should make more newspapers possible rather than fewer. That is the nature of the new technique. The new methods
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  make it possible to produce newspapers much more cheaply than at present. That should mean a wider range of newspapers.
  It is sad to look at the number of days lost in the newspaper industry. So far this year, the newspaper industry has lost 20,700 working days, about 8,000 of which only are related to the current dispute at the Financial Times. Many other disputes have taken place. In the past nine years industry generally has suffered stoppages averaging 463 day per annum per 1,000 employess; in the newspaper, publishing and printing industry, the corresponding figure is more than three times higher at 1,500 days per annum per 1,000 employees. A day and a half per man is lost in strikes in the newspaper industry. That is the measure of the poorness of industrial relations in the industry.
  Some of Fleet street's problems have arisen from the very agreements which managements and unions have reached with the presumed intention of bringing harmony to their industrial relations. I agree with much of what my hon. Friend said. If they are to be acceptable at all, closed shop agreements demand responsibility from the unions which enter into them. It is an abdication of responsibility to enter into such an agreement without the intention of ensuring that the union keeps its side of the bargain. If pockets of workers can disrupt production in a closed shop, it is for management to consider whether the closed shop agreement is worth having.
  It is far from coincidence that the newspaper industry, which has such a sorry industrial relations record, is also one of the industries in which the tentacles of the closed shop—in its most virulent pre-entry form— are most deeply entwined. There can be no better example of the harm which the closed shop does, not just to individual liberty but also to our economic health as a nation; and no better example either of the justification for the measures on the closed shop which we have taken. I note that in a leading article on 14 July 1983 The Times stated that it
  "is for Fleet Street managements to introduce a system, such as a layoff clause in their working agreements, which would prevent small groups of workers being able to hold the whole company to ransom because it has to continue paying all its other workers during their period of enforced idleness."
  The unions should take note that desperate managements are having to consider these issues to defend their companies against the attacks of short-sighted militants. They would be well advised to put their house in order.
  On the positive side of this depressing picture, I must say that some unions, at least, are seized of the need for change. Although my right hon. Friend mentioned an occasion on which there appeared to be some form of censorship, my right hon. Friend the present Secretary of State for Employment—a job previously held by my right hon. Friend who introduced this debate — was quoted in The Standard. I have the copies here. I cannot prove anything about it, nor can my right hon. Friend, but anyone who had a malevolent mind might wonder why, in the first edition, there was a picture of Mr. Joe Wade and a section praising him for the clear statement that he made at the union's conference in Eastbourne last year:
  "I have to say to you that unless we are prepared to take on board the full implications of new technology, unless we are prepared to be more flexible in our attitudes, and unless we are prepared to co-operate in improving productivity within the industry, we shall be engulfed by a tidal wave of technology which we will not be able to control. I know that there will be those who will argue that to go down that road would result in the loss of many more jobs. I have to say to you that the reverse

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  is true. Unless we make the industry more efficient, unless we reduce unit costs of production, unless we become more flexible—what we will undoubtedly get is even more competition from abroad and from instant print shops at home".
  That is what Joe Wade said. My right hon. Friend referred to it with approbation, with his customary charm, in the article that was printed in The Standard. That reference appeared in the first edition, and there was a
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  picture of Mr. Wade. In the second edition, there was no picture of Mr. Wade. No doubt that was a great sadness for many who bought the newspaper for that purpose and then found that the whole section was excised.
  Question put and agreed to.
  Adjourned accordingly at twenty-one minutes past Twelve o'clock.